Konfoong Materials International Co.Ltd(300666) internal control assurance report
As of December 31, 2021
Internal control assurance report
Xin Hui Shi Bao Zi [2022] No. zf10587 Konfoong Materials International Co.Ltd(300666) all shareholders:
We have accepted the entrustment to carry out the verification of the board of directors of Konfoong Materials International Co.Ltd(300666) (hereinafter referred to as ” Konfoong Materials International Co.Ltd(300666) “) on the effectiveness of internal control over Konfoong Materials International Co.Ltd(300666) financial reporting on December 31, 2021.
1、 Responsibilities of the board of directors for internal control
Konfoong Materials International Co.Ltd(300666) the responsibility of the board of directors is to establish, improve and effectively implement internal control in accordance with the relevant provisions of the basic norms of enterprise internal control, evaluate its effectiveness, and truthfully disclose the internal control evaluation report.
2、 Responsibilities of Certified Public Accountants
Our responsibility is to issue assurance conclusions on the effectiveness of internal control over financial reporting based on the implementation of assurance work.
3、 Job overview
We have carried out the assurance business in accordance with the provisions of other assurance business standards for Chinese certified public accountants No. 3101 – assurance business other than audit or review of historical financial information. The standard requires us to abide by the code of professional ethics of Chinese certified public accountants, plan and implement assurance work, so as to obtain reasonable assurance on whether Konfoong Materials International Co.Ltd(300666) has maintained effective internal control over financial reporting in all material aspects in accordance with the relevant provisions of the basic norms of enterprise internal control on December 31, 2021. In the process of performing the assurance work, we have implemented other procedures including understanding, testing and evaluating the effectiveness of internal control and other procedures that we deem necessary. We believe that our assurance work provides a reasonable basis for issuing assurance conclusions.
4、 Description of significant inherent limitations
Internal control has inherent limitations, and there is the possibility of undetected misstatement due to error or fraud. In addition, due to the change of circumstances, the internal control may become inappropriate, or the degree of compliance with control policies and procedures may be reduced. According to the internal control evaluation results, it is speculated that the effectiveness of internal control in the future has a certain risk.
5、 Assurance conclusion
We believe that Konfoong Materials International Co.Ltd(300666) has maintained effective internal control over financial reporting in all major aspects in accordance with the relevant provisions of the basic norms of enterprise internal control on December 31, 2021.
China certified public accountant of Lixin certified public accountants: Ling Yan
(special general partnership)
Chinese certified public accountant: Chen Sihua Chinese certified public accountant: Mei Junfeng, Shanghai, China April 25, 2002
Self evaluation report on internal control in 2021
Konfoong Materials International Co.Ltd(300666) 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 standard system), combined with the internal control system and evaluation methods of Konfoong Materials International Co.Ltd(300666) (hereinafter referred to as “the company” or “the company”), 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.
The company has no factors affecting the evaluation conclusion of internal control effectiveness from the benchmark date of internal control evaluation report to the date of issuance of internal control evaluation report.
3、 Internal control evaluation (I) scope of internal control evaluation
According to the risk oriented principle, the company determines the main units, businesses and matters included in the evaluation scope and high-risk areas.
Ltd., Yuyao Kangfute Electronic Materials Co., Ltd., Konfoong Materials International Co.Ltd(300666) materials (Hong Kong) Co., Ltd., Hefei Konfoong Materials International Co.Ltd(300666) Materials Co., Ltd., Ningbo Jiangfeng copper materials Co., Ltd., Ningbo Jiangfeng tungsten molybdenum materials Co., Ltd., Konfoong Materials International Co.Ltd(300666) materials (Singapore) Co., Ltd., Konfoong Materials International Co.Ltd(300666) materials (Malaysia) Co., Ltd., Ningbo Jiangfeng Semiconductor Technology Co., Ltd Kffmi Japan Co., Ltd., Shanghai Jiangfeng Pingxin Electronic Technology Co., Ltd., Ningbo Jiangfeng hot isostatic pressing technology Co., Ltd., Ningbo Jiangfeng composite material technology Co., Ltd., Guangdong Jiangfeng Electronic Material Co., Ltd., Ningbo Jiangfeng Xinchuang Technology Co., Ltd., Beijing Konfoong Materials International Co.Ltd(300666) Material Co., Ltd., Hunan Konfoong Materials International Co.Ltd(300666) Material Co., Ltd., Wuhan Konfoong Materials International Co.Ltd(300666) Material Co., Ltd Taiwan Konfoong Materials International Co.Ltd(300666) Materials Co., Ltd., Guizhou Xingti New Materials Research Institute Co., Ltd., Wuhan Jiangfeng Materials Research Institute Co., Ltd., Shanghai Jiangfeng Semiconductor Technology Co., Ltd., Shanghai Ruisheng Semiconductor Technology Co., Ltd., Jiangxi Jiangfeng special materials Co., Ltd., Jiaxing Konfoong Materials International Co.Ltd(300666) Materials Co., Ltd., Shanghai Konfoong Materials International Co.Ltd(300666) Materials Co., Ltd Shanghai Runping Electronic Materials Co., Ltd. and Lishui Ruisheng Semiconductor Technology Co., Ltd., the total assets of the units included in the evaluation scope account for 100.00% of the total assets in the company’s consolidated financial statements, and the total operating revenue accounts for 100.00% of the total operating revenue in the company’s consolidated financial statements.
The main businesses and matters included in the evaluation scope include: control environment, risk assessment, information system and communication, control activities, supervision of control and other elements. Specific businesses include the internal control related to financial statements involved in the company’s business: corporate governance structure and organizational structure, financial management system and financial report, raised fund management, sales and collection, procurement and payment, asset management, contract management, related party transaction management, foreign investment and foreign guarantee management, major investment management, internal audit supervision, subsidiary management system Information disclosure management, etc. The above units, businesses and matters included in the evaluation scope cover the main aspects of the company’s operation and management, and there are no major omissions. The high-risk areas of focus mainly include: foreign investment and foreign guarantee management, related party transactions, major investment decision management, raised funds management and information disclosure.
(II) principles of internal control
1. Principle of legitimacy
Internal control shall comply with the provisions of relevant national laws and administrative regulations and the regulatory requirements of relevant government regulatory departments, and comply with the actual situation of the company.
2. Principle of comprehensiveness
The establishment of internal control should run through the whole process of decision-making, implementation and supervision, covering all businesses and matters of the company and its subsidiaries.
3. Principle of importance
Internal control should pay attention to important business matters and high-risk areas on the basis of comprehensive control.
4. Principle of checks and balances
Internal control should restrict and supervise each other in terms of governance structure, institutional setting, distribution of rights and responsibilities and business processes, and take into account operational efficiency.
5. Adaptability principle
The internal control shall adapt to the business scale, business scope, competition and risk level, and shall be adjusted in time with the changes of the situation.
6. Cost benefit principle
Internal control should weigh the implementation cost and expected benefits, and implement effective control at an appropriate cost.
(III) procedures and methods of internal control evaluation
The internal control evaluation shall be carried out in strict accordance with the procedures specified in the basic norms, evaluation guidelines and the company’s internal control evaluation measures. The audit department is responsible for formulating the internal control evaluation plan and evaluation work plan. All departments and units carry out self-evaluation. The audit department comprehensively reviews and identifies the control defects, prepares the internal evaluation report and submits it to the Audit Committee for consideration. In the process of internal control evaluation, we adopted the methods of individual interview, questionnaire, special discussion, review and inspection, walk through test, sampling and analytical review to fully collect the evidence of whether the company’s internal control design and operation are effective, and analyze and identify the internal control defects according to the specific contents of the evaluation.
4、 Construction and implementation of internal control system (I) internal control environment
1. Corporate governance structure and organizational structure
In accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”), the securities law of the people’s Republic of China (hereinafter referred to as the “Securities Law”) and other relevant national laws and regulations and the requirements of regulatory authorities, the company has reasonably set up an organizational structure that meets the needs of the company’s business scale and operation and management, including the general meeting of shareholders, the board of directors The management system of the board of supervisors and the management. The company has formulated the articles of association, rules of procedure of the general meeting of shareholders, rules of procedure of the board of directors, working system of independent directors, rules of procedure of the board of supervisors, decision-making system of related party transactions, management system of external guarantee, management system of raised funds and other systems, clarified the responsibilities and authorities in decision-making, implementation and supervision, and formed a scientific and effective system Reasonable division of responsibilities and check and balance mechanism.
The general meeting of shareholders is the highest authority of the company, which deliberates and makes decisions on major matters such as the company’s business policies, investment plans and major transactions, and exercises voting rights according to law. The general meeting of shareholders of the company shall exercise its powers in strict accordance with the articles of association and the rules of procedure of the general meeting of shareholders.
The board of directors is responsible for the general meeting of shareholders, consisting of 9 directors and 1 Chairman. Board members include 3
Independent directors. The board of directors is the business decision-making body of the company. It has four special committees: Strategy Committee, salary and assessment committee, nomination committee and audit committee. It has formulated the working rules of corresponding professional committees and clarified their respective responsibilities and authorities in the corporate governance structure. The of the board of directors of the company has faithfully performed the rights and obligations conferred by the company law and the articles of association. The special committees of the board of directors can perform their duties diligently in accordance with laws, regulations, the articles of association and the work regulations of the special committees, and the operation is in good condition. The independent directors of the company can earnestly perform the functions and powers of independent directors, ensure the scientificity of the decision-making of the board of directors and safeguard the rights and interests of small and medium-sized investors in accordance with the requirements of laws, regulations and systems such as the company law, the articles of association and the working system of independent directors.
The board of supervisors is responsible to the general meeting of shareholders and is the supervision organization of the company. It is responsible for supervising the directors, general manager and other senior managers of the company to perform their duties according to law, and supervising and inspecting the company’s financial status and internal control standard system. The board of supervisors faithfully performed the rights and obligations conferred by the company law and the articles of association in accordance with the law.
The management of the company is responsible for the daily operation and management of the company. According to the needs of business development, internal control and its own characteristics, the company sets up technical service department, production and operation Department, sales department, logistics department, quality department
