Audit Committee

The Company's Audit Committee was established in fiscal year 108 and consists of three independent directors. It meets at least quarterly and from time to time as necessary. One of the three members is a certified public accountant and one has a professional background in finance, and the convenor is Independent Director Huang Dongrong, a certified public accountant. The term of office of the current Audit Committee is the same as the term of office of the Directors. The term of office of the Audit Committee is the same as the term of office of the Directors. The Audit Committee primarily assists the Board of Directors in fulfilling its responsibilities of overseeing the quality and integrity of the Company's execution of the relevant accounting, auditing and financial reporting processes and financial controls. The Audit Committee is expected to meet at least once a quarter to fully communicate with the Company's head of audit regarding the opinions on motions at the meetings, and minutes of the meetings will be made available for review.
The terms of reference of the Audit Committee mainly include:

1.  Financial Statement Auditing and Accounting Policies and Procedures.
2. Internal Control System and Related Policies and Procedures.
3. Significant asset or derivative transactions.
4. The Company's financial statements are prepared in accordance with the provisions of the Securities and Exchange Act of 1934, as amended, and with the provisions of the Securities and Exchange Act of 1934, as amended.
5.  Raise or issue marketable securities.
6. Derivative financial instruments and cash investments.
7.  Statutes Follow.
8. Whether the manager and the director have related party transactions and possible conflicts of interest.
9.  Complaint Report.  
10. Fraud prevention programs and fraud investigation reports.
11. Information security.
12. Corporate Risk Management.
13. Qualifications, independence and performance evaluation of certified public accountants.
14. The appointment, dismissal or remuneration of a certified public accountant.  
15. Appointment or removal of the head of finance, accounting or internal audit.
16. Performance of the duties of the Audit Committee.
17. Audit Committee Performance Measurement Self-Assessment Questionnaire.  

Review of Financials

We report that the Board of Directors has prepared the annual report on the Company's operations, financial statements and proposal for appropriation of earnings, etc., and the financial statements have been audited and completed by AICPA, and the audit report has been issued by AICPA. The aforesaid business report, financial statements and proposal for appropriation of earnings have been examined by the Audit Committee and found to be in order.  

Evaluation of the effectiveness of the internal control system

The Audit Committee evaluates the effectiveness of the Company's internal control system's policies and procedures (including financial, operational, risk management, information security, external, and compliance controls) and reviews the periodic reports of the Company's audit department, certified public accountants, and management, including risk management and compliance. With reference to the Internal Control-Integrated Framework issued by The Committee of Sponsoring Organizations of the Treadway Commission (COSO) in 2013, the Audit Committee is of the opinion that the Company's risk management and compliance with laws and regulations are in good standing. The Committee of Sponsoring Organizations of the Treadway Commission (COSO) has issued the Internal Control-Integrated Framework (ICIF) for the Company's internal control system, and the Audit Committee is of the opinion that the Company's risk management and internal control system is effective and that the Company has adopted the necessary control mechanism to monitor and rectify the irregularities.