Sustainability

Internal Audit

Pou Chen’s Internal Audit is an independent unit with one chief internal auditor and three internal auditors under the direct jurisdiction of the Board of Directors. According to the Company's "Internal Audit System", the appointment or dismissal of the chief internal auditor shall be approved by the Audit Committee and be submitted to the Board of Directors for approval, and the appointment, dismissal, assessment and salaries of internal auditors shall be submitted by the chief internal auditor to the Chairman for approval.

The Company’s internal auditors perform their work in a professional, objective and fair manner, covering important operating cycles and business activities of Pou Chen and its subsidiaries. Internal Audit Unit formulates annual audit plans based on the results of risk assessment, and submits to the Audit Committee and the Board of Directors for discussion and approval. Then internal audits are conducted one by one to assist the Board of Directors and managerial officers in inspecting and reviewing the implementation of the internal control system as well as measuring operational effectiveness and efficiency. Recommendations for improvements are also provided in a timely manner. Audit results are reported to the Chairman and each independent director by the end of the following month. Besides, the chief internal auditor attends the Board of Directors’ meeting to report the inspection results of audit items.

When conducting audit items, internal auditors also review and communicate with each functional unit and operating unit regarding the self-inspection status of internal control system. The Internal Audit Unit then consolidates the self-assessment reports comprising five constituent elements, control environment, risk assessment, control activities, information and communications, and monitoring activities, to serve as the primary basis for the Board of Directors to evaluate the effectiveness of internal control system and to generate the "Internal Control System Statement".