Sinolink Securities Co.Ltd(600109)
About Hangzhou Zhengqiang transmission Co., Ltd
Verification opinions on self-evaluation report of internal control in 2021
Sinolink Securities Co.Ltd(600109) (hereinafter referred to as " Sinolink Securities Co.Ltd(600109) " or "sponsor") is the sponsor of Hangzhou Zhengqiang transmission Co., Ltd. (hereinafter referred to as "Zhengqiang" or "company") for initial public offering and listing on GEM, In accordance with the measures for the administration of securities issuance and listing recommendation business, the Listing Rules of Shenzhen Stock Exchange on the gem, the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 2 - standardized operation of listed companies on the gem and other relevant provisions, the self-evaluation report on internal control of Zhengqiang Co., Ltd. in 2021 was verified. The verification results are as follows:
1、 Verification work carried out by the recommendation institution
Sinolink Securities Co.Ltd(600109) sponsor representatives check the integrity, rationality and effectiveness of the company's internal control by consulting various business and management rules and regulations, relevant meeting minutes of the board of directors and annual internal control evaluation report, and communicating with the company's directors, supervisors, senior managers, internal auditors, audit accountants and other relevant personnel.
2、 Internal control evaluation of Zhengqiang Co., Ltd
(I) evaluation scope of internal control
According to the risk oriented principle, the company determines the main units, businesses and matters included in the evaluation scope and high-risk areas.
The units included in the scope of evaluation include Hangzhou Zhengqiang transmission Co., Ltd., Zhejiang Zhengqiang Auto Parts Co., Ltd., Zhejiang Anji Zhengqiang Machinery Co., Ltd. and Zhuji Jiqiang Auto Parts Co., Ltd. the total assets of the units included in the scope of evaluation account for 100% of the total assets in the financial statements of the company within the scope of consolidation, and the total operating revenue accounts for 100% of the total operating revenue in the financial statements of the company within the scope of consolidation.
The main businesses included in the evaluation scope include: R & D, production and sales of cross shaft universal joint assembly, yoke and related parts.
Industrialization, social responsibility, development strategy, capital activities, asset management, foreign investment, procurement business, sales business, research and development, financial report, contract management, subsidiary management, information system, information disclosure, etc; The high-risk areas of focus mainly include: sales business, procurement business, subsidiary management, information disclosure, foreign investment and asset management.
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.
(II) basis of internal control evaluation and identification standard of internal control defects
The company organizes and carries out internal control evaluation in accordance with the requirements of enterprise internal control standard system, Shenzhen Stock Exchange GEM Listing Rules, basic norms of enterprise internal control and other relevant laws, regulations, rules and regulations.
According to the identification requirements of the enterprise internal control standard system for major defects, important defects and general defects, and in combination with the company's scale, industry characteristics, risk preference, risk tolerance and other factors, the board of directors of the company distinguished the internal control of financial reports from the internal control of non-financial reports, and studied and determined the specific identification standards of internal control defects applicable to the company. The identification standards of internal control defects determined by the company are as follows:
1. Identification standard of internal control defects in financial reporting
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 by the operating revenue index. If the amount of financial report misstatement that may be caused by the defect alone or in combination with other defects is less than 1% of the operating revenue, it is recognized as a general defect; If it exceeds 1% but less than 2% of the operating revenue, it is an important defect; If it exceeds 2% 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 report misstatement 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 significant deficiencies in financial reporting include:
① Invalid control environment;
② Fraud of directors, supervisors and senior managers of the company;
③ Material misstatement in the current financial report found by the certified public accountant but not identified by the company's internal control;
④ The supervision of the audit committee and the audit department on the company's external financial report and internal control over financial report is invalid.
(2) Signs of significant deficiencies in financial reporting include:
① Failure to select and apply accounting policies in accordance with GAAP;
② Failure to establish anti fraud procedures and control measures;
③ No corresponding control mechanism has been established or implemented for the accounting treatment of unconventional or special transactions, and there is no corresponding compensatory control;
④ There are one or more defects in the control of the financial reporting process at the end of the period, and it can not reasonably ensure that the prepared financial statements achieve the true and complete goal.
(3) General defects 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:
The quantitative standard for the evaluation of internal control defects in non-financial reports shall be implemented with reference to the quantitative standard for the evaluation of internal control defects in financial reports.
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
(1) Signs of significant deficiencies in non-financial reporting include:
Violation of national laws and regulations or normative documents, unscientific major decision-making procedures, lack of system may lead to systematic failure of internal control, major or important defects have not been rectified, and other situations with significant negative impact on the company.
(2) Signs of significant deficiencies in non-financial reporting include:
① Defects in important business systems or processes;
② Major mistakes in decision-making procedures;
③ Serious loss of personnel in key positions;
④ Important defects found in internal control and internal supervision are not rectified in time;
⑤ Other situations that have a great negative impact on the company.
(3) General defects in non-financial reports refer to other control defects other than the above major defects and important defects.
(III) implementation and existing problems of the company's main internal control systems
1. Identification and rectification of internal control defects in financial reporting
According to the above identification standards of internal control defects in financial reports, the company has no major defects in internal control over financial reports 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 reporting, the company found no significant defects in internal control of non-financial reporting during the reporting period.
3、 Description of other major matters related to internal control
The company has no explanation of other major matters related to internal control.
4、 Self evaluation conclusion of the company on internal control
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.
5、 Verification opinions of the recommendation institution
After verification, the sponsor believes that the self-evaluation report on internal control in 2021 prepared by the board of directors of Zhengqiang shares fairly reflects the operation of its internal control system.
(there is no text on this page, which is the signature page of Sinolink Securities Co.Ltd(600109) on the verification opinions on the 2021 internal control self-evaluation report of Hangzhou Zhengqiang transmission Co., Ltd.)
Sponsor representative:
Wang Fei, Yang Liguo
Sinolink Securities Co.Ltd(600109) mm / DD / yyyy
