Oriental Energy Co.Ltd(002221)
Internal control evaluation report in 2021
Oriental Energy Co.Ltd(002221) all shareholders:
In accordance with the provisions of the basic norms of enterprise internal control and its supporting guidelines and other internal control regulatory requirements (hereinafter referred to as the "enterprise internal control normative system"), combined with Oriental Energy Co.Ltd(002221) (hereinafter referred to as the company) internal control system and evaluation methods, on the basis of daily and special supervision of internal control, We evaluated the effectiveness of the company's internal control on December 31, 2021 (the benchmark date of the internal control evaluation report).
1、 Important statement
It is the responsibility of the board of directors of the company to establish, improve and effectively implement internal control, evaluate its effectiveness and truthfully disclose the internal control evaluation report in accordance with the provisions of the enterprise's internal control standard system. The board of supervisors shall supervise the establishment and implementation of internal control by the board of directors. The management is responsible for organizing and leading the daily operation of the enterprise's internal control. The board of directors, the board of supervisors and the directors, supervisors and senior managers of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this report, and bear individual and joint legal liabilities for the authenticity, accuracy and completeness of the contents of the report.
The objective of the company's internal control is to reasonably ensure the legal compliance of operation and management, asset safety, authenticity and integrity of financial reports and relevant information, improve operation efficiency and effect, and promote the realization of development strategy. Due to the inherent limitations of internal control, it can only provide reasonable assurance for the realization of the above objectives. In addition, as changes in circumstances may lead to inappropriate internal control or reduced compliance with control policies and procedures, there is a certain risk to speculate the effectiveness of internal control in the future according to the internal control evaluation results.
2、 Internal control evaluation conclusion
According to the identification of major defects in the company's internal control over financial reporting, there are no major defects in the internal control over financial reporting on the benchmark date of the internal control evaluation report. The board of Directors believes that the company has maintained effective internal control over financial reporting in all major aspects in accordance with the requirements of the enterprise's internal control standard system and relevant regulations. According to the identification of major defects in the company's internal control over non-financial reports, the company found no major defects in the company's internal control over non-financial reports on the benchmark date of the internal control evaluation report.
There are no factors affecting the evaluation conclusion of the effectiveness of internal control from the base date of the internal control evaluation report to the date of issuance of the internal control evaluation report.
3、 Internal control evaluation
(I) evaluation scope of internal control
Comprehensively consider the relevant businesses and matters of the company and all functional departments, and determine the main units, businesses and matters and high-risk areas included in the evaluation scope according to the risk-oriented principle. The units included in the evaluation scope include the parent company and its subsidiaries; The proportion of the total assets of the unit included in the evaluation scope to the total assets of the company's consolidated financial statements is 100%; The proportion of the operating income of the units included in the evaluation scope in the operating income of the company's consolidated financial statements is 100%.
The main businesses and matters included in the evaluation scope include: organizational structure, development strategy, human resources, social responsibility, corporate culture, capital activities, procurement business, asset management, sales business, engineering projects, guarantee business, business outsourcing, comprehensive budget, contract management, internal information transmission, information system, etc; Information disclosure of major businesses, such as inventory raising and related party transactions, high-risk investment, and other key areas of concern.
The above units, businesses and matters included in the evaluation scope and high-risk areas cover the main aspects of the company's operation and management, and there are no major omissions.
（2） Basis of internal control evaluation and identification standard of internal control defects
The company carries out internal control evaluation according to the enterprise internal control standard system and organization.
The board of directors of the company distinguished the internal control of financial report from the internal control of non-financial report according to the identification requirements for major defects, important defects and general defects of the enterprise internal control standard system, combined with the factors such as the company's size, industry characteristics, risk preference and risk tolerance, and studied and determined the specific identification standards of internal control defects applicable to the company, which are consistent with the previous years. The identification standards of internal control defects determined by the company are as follows: 1. Identification standards of internal control defects in financial reports
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
The quantitative standard takes the operating income and total assets as the measurement indicators. If the loss that may be caused or caused by the defect of internal control is related to the income statement, it shall be measured with the operating revenue as the indicator. If the amount of financial reporting error caused by the defect alone or in combination with other defects is less than 0.5% of the operating revenue, it is recognized as a general defect; if it exceeds 0.5% but less than 1% of the operating revenue, it is recognized as an important defect; if it exceeds 1% of the operating revenue, it is recognized as a major defect.
Losses that may be caused or caused by internal control defects related to asset management shall be measured by the total asset index. If the amount of financial reporting errors that may be caused by the defect alone or in combination with other defects is less than 0.5% of the total assets, it is recognized as a general defect; if it exceeds 0.5% but less than 1% of the total assets, it is recognized as an important defect; if it exceeds 1% of the total assets, it is recognized as a major defect.
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
(1) Signs of major defects in financial reports include: fraud by directors, supervisors and senior managers of the company; The company corrects the published financial report; The certified public accountant finds that there is a material misstatement in the current financial report, but the internal control fails to find the misstatement in the operation process; The supervision of the audit committee and the audit department on the company's external financial report and internal control of financial report is invalid.
(2) Signs of significant deficiencies in financial reporting include: failure to select and apply accounting policies in accordance with generally accepted accounting standards, failure to establish anti fraud procedures and control measures; For the accounting treatment of unconventional or special transactions, no corresponding control mechanism has been established or no corresponding compensatory measures have been implemented; There are one or more defects in the process of financial report at the end of the period, and there is no reasonable guarantee that the prepared financial report can achieve the goal of authenticity and accuracy.
(3) General defects in financial reports refer to other control defects other than the above major defects and important defects. 2. Identification standard of internal control defects in non-financial reporting
The quantitative criteria for evaluation of internal control defects in non-financial reporting determined by the company are as follows:
After considering the compensatory measures and actual deviation rate, the amount involved shall prevail, and if the direct property loss exceeds 1% of the total assets of the company, it shall be recognized as a major defect; If the direct property loss exceeds 0.5% but less than 1% of the total assets of the company, it shall be recognized as an important defect; If the direct property loss does not exceed 0.5% of the total assets of the company, it is recognized as a general defect.
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
The following situations can be identified as major defects, and other situations can be identified as major defects or general defects according to the degree of influence: the company lacks democratic decision-making procedures, such as collective decision-making procedures; Violation of national laws and regulations, such as major production safety and environmental pollution accidents; Loss of management personnel or technicians in key positions; The results of internal control evaluation, especially major or important defects, have not been rectified; Lack of institutional control or systematic failure of important business.
(III) identification and rectification of internal control defects
1. Identification and rectification of internal control defects in financial reporting
According to the above identification standards of financial internal control defects, the company has no major defects or important defects in the internal control of financial reporting during the reporting period.
2. Identification and rectification of internal control defects in non-financial reports
According to the above identification standards of internal control defects in non-financial reports, no major defects or important defects in the company's internal control over non-financial reports were found during the reporting period.
3. The company has no major defects or important defects in internal control continued in previous years.
4、 Description of other major matters related to internal control
The company has no other major matters related to internal control.
Oriental Energy Co.Ltd(002221) board of directors
April 20, 2022
