Internal Audit Organization and Operation

(1) Purpose

1. Assist the board of directors and managers in checking and reviewing the internal control system’s deficiencies and measuring the effectiveness and efficiency of operations. Provide improvement suggestions at right time to ensure the continuous and effective implementation of the internal control system, and serve as the basis for review and revision of the internal control system.

2. The nature of the work of internal audit is to assist management so that various operation records and processing procedures are sound, and collect all kinds of information at any time to provide references for decision-making or planning. From an independent standpoint, conduct effective analysis and assessment of the business activities of each department under established standards or regulations to assist each management level in achieving its mission.

(2) Organization

This internal audit unit of the company is subordinate to the board of directors. An audit supervisor is set up to comprehensively manage the company’s internal audit business. The audit supervisor would attend the board of directors and submit internal audit business reports at quarterly meetings.

(3) Operation

The internal audit unit would draw up an annual audit plan based on the results of the risk assessment and execute it after the board of directors approved.

The internal auditors shall check and evaluate the multi-transaction cycles of the company’s internal control system according to the annual audit plan, attach working papers and random inspection data, and so on, to prepare an audit report and deliver it to the independent directors and supervisors before the end of the next month after the audit project is completed.