360 Security Technology Inc(601360)
2021 performance report of the audit committee of the board of directors
In accordance with the company law, the guidelines for the governance of listed companies and other laws and regulations, as well as the articles of association and the detailed rules for the work of the audit committee of the board of directors, the audit committee of the board of directors of 360 Security Technology Inc(601360) (hereinafter referred to as the “company”) has carried out its work diligently and effectively with a serious and responsible attitude, and earnestly fulfilled its responsibilities. The report on the performance of the audit committee of the board of directors in 2021 is as follows:
1、 Personnel of the audit committee of the board of directors
At the beginning of the reporting period, the audit committee of the 5th board of directors of the company was composed of independent director Mr. Ming Huang and independent director Mr. Xu Jingchang, who served as the chairman.
Due to the expiration of the term of office of the Fifth Board of directors, the company held the 2020 annual general meeting of shareholders on May 12, 2021, deliberated and adopted the proposal on the replacement of the board of directors and the election of independent directors of the sixth board of directors, elected Mr. Ming Huang, Mr. Xu Jingchang and Mr. Liu Shian as independent directors of the sixth board of directors, and held the first meeting of the sixth board of directors on the same day, The proposal on electing members of the special committee of the sixth board of directors of the company was deliberated and adopted, and the independent director Mr. Xu Jingchang, the independent director Mr. Ming Huang and the independent director Mr. Liu Shian were elected to form the audit committee of the sixth board of directors of the company, and the independent Director Mr. Xu Jingchang served as the chairman.
2、 Annual meeting of the audit committee
In 2021, the audit committee of the board of directors of the company held four meetings. The meetings are as follows:
Meeting date and content
Session
1. Proposal on the company’s 2020 annual report and its summary
2. Proposal on the company’s 2020 financial final accounts report
3. Proposal on profit distribution plan of the company in 2020
The 5th session 4. Proposal on the company’s internal control evaluation report in 2020
Article XIII April 20, 2021 5. Proposal on the prediction of the company’s daily connected transactions in 2021
6. Proposal on the company’s report for the first quarter of 2021
7. Application for comprehensive credit from banks for the company and its subsidiaries in 2021
Proposal on providing guarantee for credit line
8. Report on the company and its subsidiaries’ commission with idle self owned funds in 2021
Proposal on entrusted financial management
9. Proposal on using some idle raised funds for cash management 10. Proposal on changes in accounting policies of the company
11. Special report on the deposit and actual use of raised funds in 2020
1. Semi annual report and summary of 2021
2. The sixth report of the special report on the deposit and actual use of raised funds in the half year of 2021
On August 26, 2021 for the first time 3. Proposal on renewing the appointment of 2021 financial report and internal control audit institution
4. Proposal on adjusting the amount of entrusted financial management of the company and its subsidiaries with idle self owned funds in 2021
On October 26, 2021 of the sixth session 1. Proposal on the company’s report for the third quarter of 2021
The second time
On December 23, 2021, the sixth session communicated with the annual audit accountant on the audit work plan of the 2021 annual report
third time
3、 Performance of the audit committee of the board of directors
1. Review and comment on the financial report
(1) Supervise annual audit
For the preparation and review of the 2021 annual report, the audit committee of the board of directors of the company implements the whole process management and supervision in accordance with relevant laws and regulations:
The first is to determine the audit plan, carry out special discussion on the overall annual audit strategy and specific audit plan according to the pre-trial situation, review the professional competence and independence of auditors, and communicate the key audit matters in the audit plan, so as to ensure the orderly implementation of audit policies;
The second is to review the unaudited financial statements, consider that the financial report (Unaudited) prepared by the company basically reflects the company’s financial situation, operating results and cash flow, listen to the detailed report of the company’s management on the operating situation, and agree to carry out the corresponding annual financial audit based on the financial report;
Third, supervise the audit process, listen to the latest progress report of the annual audit, pay attention to the audit of important accounting subjects, urge the audit institutions to arrange auditors, strictly implement the audit plan, issue the first draft of financial and accounting statements and internal control audit opinions on schedule, and communicate the relevant problems and suggestions found in the audit at the same time;
The fourth is to review the audit report, conduct in-depth exchanges with the company’s management on key audit matters, formally review the financial report and agree to submit it to the company’s board of directors for review.
During the audit of this annual report, the audit committee of the company was responsible, actively promoted the annual audit process of the company, timely communicated and contacted with the financial director of the company on relevant issues, and effectively put forward solutions, which fully guaranteed the smooth progress of the annual audit of the company.
(2) Review other regular financial reports
During the reporting period, the audit committee of the board of directors of the company carefully reviewed the relevant financial information such as the first quarterly report, the semi annual report and the third quarterly report of the company, and believed that the financial report of the company truly, accurately and completely reflected the financial status and operating results of the company, and there were no fraud, fraud and major misstatement related to the financial report, and there were no major accounting error adjustment, major accounting policy and estimation changes Matters involving important accounting judgments and matters leading to non-standard unqualified audit reports.
2. Review related party transactions
During the reporting period, the audit committee of the board of directors of the company reviewed the proposal on the prediction of the company’s daily connected transactions in 2021, understood the necessity and fairness of various connected transactions, and believed that the daily connected transactions of the company were required for daily business activities, and the pricing of transactions followed the principles of fairness, openness and fairness, which was in line with the overall interests of listed companies and shareholders, and had an impact on the current and future financial situation of the company There is no adverse impact on the operating results and will not affect the independence of the company.
3. Supervise and evaluate the work of external audit institutions
The audit committee of the board of directors of the company believes that Deloitte Touche Tohmatsu (special general partnership) (hereinafter referred to as “Deloitte”) has strictly complied with the audit standards for Chinese certified public accountants, followed the independent, objective and fair practice standards, conducted objective, fair and realistic audit on the company’s assets and operating results, and completed various audit tasks, And show good professional ethics and professional quality. The audit committee recommends to the board of directors that Deloitte Touche Tohmatsu (special general partnership) be appointed as the financial audit institution of the company for the next year.
4. Pay attention to the construction of internal control
The company has established a compliant, complete and effective governance structure and system in accordance with the requirements of the company law, the securities law and other laws and regulations and the relevant provisions of the China Securities Regulatory Commission and Shanghai Stock Exchange, and the internal risk management system is becoming more and more perfect. During the reporting period, the audit committee of the company’s board of directors carefully reviewed the company’s internal control evaluation report and internal control audit report, and believed that the company’s internal control system was sound, the internal system was perfect, the actual operation was good, in line with the relevant requirements of the governance norms of listed companies, there were no major defects and important defects, and effectively played the function of risk prevention and control.
5. Supervise and guide internal audit
During the reporting period, the audit committee of the board of directors reviewed the company’s internal audit work plan, carefully reviewed and guided the feasibility of the audit plan and the standardization of the process according to the provisions of relevant laws and regulations and the actual situation of the company, continued to promote the improvement of the company’s internal audit work, and found no major problems in the company’s internal audit work.
6. Coordinate the communication between management, internal audit department and relevant departments and external audit institutions
During the reporting period, in order to better enable the management, the internal audit department and relevant departments to fully and effectively communicate with the accounting firm, we listened to opinions from many parties, actively carried out relevant coordination work, promoted full and effective communication between all parties, improved the effect and efficiency of the audit work, and ensured the smooth progress of all audit work in the year. 7. Supervise the deposit and use of raised funds
During the reporting period, the audit committee reviewed the deposit and use of the company’s raised funds. It is considered that the deposit, use and disclosure of the company’s raised funds comply with the provisions of the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies and the guidelines for the self discipline supervision of listed companies on Shanghai Stock Exchange No. 1 – standardized operation, and there is no illegal deposit and use of raised funds.
4、 Overall evaluation
In 2021, all the members of the audit committee performed all the duties of the audit committee diligently in strict accordance with the relevant provisions of the company law, the articles of association and the working rules of the audit committee, with an attitude of being responsible to the company and all shareholders, made full use of professional knowledge and played a role in the company’s audit work and internal control management. In 2022, the audit committee will continue to perform its duties in accordance with relevant regulations, further strengthen the supervision and review function of the audit committee, actively play a professional role, promote the continuous and standardized operation of the company and safeguard the legitimate rights and interests of the company and all shareholders.
360 Security Technology Inc(601360) board of directors audit committee April 20, 2022
