Internal Audit

The Company’s audit office is an independent department directly reports to the Board of Directors. Internal auditors perform their tasks both independently and objectively to provide the Board of Directors timely feedback on the functioning of internal control system. The appointment of Chief Audit Officer needs to be approved by the Board of Directors, and an adequate number of employees are dedicated to the audit office. Appointment, dismissal, evaluation and review, salary and compensation of internal auditors are submitted by the Chief Audit Officer to the Chairman for approval.

The majority of the audit task is to execute regular audits or project-based audits in accordance with the Company’s internal control plan and management’s assignments to ensure the strict implementation and well-functioning of the internal control system.

Audit reports and follow-up reports are reviewed by the Audit Committee periodically after internal auditors conduct regular audits.