Xuzhou Handler Special Vehicle Co.Ltd(300201)
Self evaluation report on internal control in 2021
Xuzhou Handler Special Vehicle Co.Ltd(300201) all shareholders:
According to 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 the internal control system and evaluation method of Xuzhou Handler Special Vehicle Co.Ltd(300201) (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 as of December 31, 2021 (benchmark date of 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
There are major defects in the internal control over financial reporting. 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 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 has 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
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 main units included in the evaluation scope include the company and Shanghai granman international fire fighting equipment Co., Ltd. the total assets of the units included in the evaluation scope account for 99.67% of the total assets in the company’s consolidated financial statements, and the total operating revenue accounts for 99.32% of the total operating revenue in the company’s consolidated financial statements.
The main items included in the evaluation scope include: governance structure, organizational structure, development strategy, human resources, corporate culture, capital activities, procurement business, asset management, sales business, research and development, engineering projects, internal and external information and communication, internal audit, related transactions, external guarantee, external investment, information disclosure, etc; The high-risk areas of focus mainly include related party transactions, external guarantees, major investments, subsidiary management, etc.
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 evaluation in accordance with the basic norms of enterprise internal control and its supporting guidelines and other relevant provisions, in combination with the provisions of relevant systems, processes and other documents of the company.
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 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:
Importance general defect important defect major defect
Misstatement of operating revenue ≤ 2% of operating revenue 2% misstatement ≤ misstatement 5% of operating revenue 5% of potential misstatement of operating revenue
Misstatement of total assets ≤ 1% of total assets 1% misstatement ≤ misstatement 2.5% of total assets 2.5% of total output of potential misstatement
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
In case of any of the following circumstances, it is recognized that there are major defects in the internal control of financial reporting:
(1) It is found that directors, supervisors and senior managers have major fraud in the company’s management activities;
(2) It is found that there are significant misstatements in the current financial statements, but the internal control fails to find them in the operation process;
(3) The supervision of the company’s audit committee and internal control audit institution on internal control is invalid;
(4) Administrative penalties imposed by securities regulatory authorities due to accounting errors;
If the following characteristics occur, it is recognized that there are important defects in the internal control of financial reporting:
(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 financial 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 goal of authenticity and accuracy;
Control defects other than major defects and important defects are general defects.
2. Identification standard of internal control defects in non-financial reporting
The quantitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
General defect important defect major defect
Direct property less than 1 million yuan (including 1-5 million yuan) (including more than 5 million yuan)
Loss amount (1 million yuan) 5 million yuan)
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Defects with the following characteristics are recognized as major defects:
(1) Major mistakes caused by the company’s decision-making procedures;
(2) The company’s important business lacks system control or the system fails;
(3) Major or important defects in the company’s internal control have not been rectified;
(4) The company violates national laws and regulations and is subject to a penalty of more than 100000 yuan.
Defects with the following characteristics are recognized as important defects:
(1) General mistakes caused by the company’s decision-making procedures;
(2) There are defects in the company’s important business system or system;
(3) Major or general defects in the company’s internal control have not been rectified;
(4) The company violates internal rules and regulations, resulting in losses.
Defects with the following characteristics are recognized as general defects:
(1) The efficiency of the company’s decision-making procedure is not high;
(2) Defects in the company’s general business system or system;
(3) The company’s general defect system or system has not been rectified;
(4) The company violates the internal rules and regulations, but no loss is caused
(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 internal control defects in financial reporting, the company has no major defects and important defects in 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, the company has no major defects and important defects in internal control of non-financial reports during the reporting period.
4、 Description of other major matters related to internal control
During the reporting period, the company has no other major matters related to internal control that need to be explained.
Xuzhou Handler Special Vehicle Co.Ltd(300201) April 27, 2022
