Internal Audit

I. Internal Audit Organization:  
  1. Set up an internal audit unit: under the board of directors.
  2. Configure full-time auditors: 1~2 people.
  3. The appointment and dismissal, evaluation, compensation of the Company's auditors shall be approved by the Board Chairman and Audit Committee and resolved in the board meeting.
II. Internal Audit Operations:
  1. The purpose of implementing internal audits is to assist the board of directors to inspect and review the deficiencies of the internal control system, measure the effectiveness and efficiency of operations, and provide timely improvement suggestions to ensure the continuous and effective implementation of the internal control system and serve as a basis for review of the internal control system.
  2. The auditing operations are all handled in accordance with the relevant provisions of the "Guidelines for the Establishment of Internal Control Systems by Public Offering Companies" and the order issued by the “Financial Supervisory Commission R.O.C.” of the Executive Yuan.
  3. In the planning of risk assessment operations, with reference to risk factors and the actual operating conditions of the Company, an audit plan is drawn up, submitted and executed. An audit report is issued, and defects are tracked and improved.
  4. Internal Audit Procedures:
    (1) Report the "Annual Audit Plan" for the following year before the end of December each year.
    (2) Declare the "Information of Audit Supervisor and Auditors" for the annual year before the end of January each year.
    (3) Report the "Annual Audit Plan Implementation Status" of the previous year before the end of February each year.
    (4) Declare the "Declaration of Internal Control System" for the previous year before the end of March each year.
    (5) Report the "Deficiency of internal control system and improvement of abnormal matters" of the previous year before the end of May each year.
III. The communication policy between independent directors, internal audit supervisors and certified accountants:
  1. The head of internal audit and independent directors convene a board meeting at least quarterly to report on the Company's internal audit performance and internal control operations; meetings may be convened at any time in the event of major abnormalities.
  2. The communication between Company’s independent directors and the certified accountants is excellent, and the responsibility and independence of the audit report and the audit plan are explained in the board meetings. They can also communicate with each other by e-mail or telephone at any time needed.
  3. Summary of the communication between independent directors and the certified accountants: (Chart 1 below).
  4. Summary of historical communications between independent directors and audit supervisors: (Chart 2 below).

 
[Chart 1] Summary of the communication between independent directors and the certified accountants

Meeting Date Communication Type Communication Matters Communication Results
2020/03/24 Audit Committee The accountant explained the key audit items of the parent only and consolidated financial reports for 2019 and the results of the financial report audits.

It has been approved by the audit committee and submitted to the board of directors for approval and reported to the competent authority.

2021/03/08 Audit Committee The accountant explained the key audit items of the parent only and consolidated financial reports for 2020 and the results of the financial report audits.

It has been approved by the audit committee and submitted to the board of directors for approval and reported to the competent authority.

2022/03/09 Audit Committee The accountant explained the key audit items of the parent only and consolidated financial reports for 2021 and the results of the financial report audits.

It has been approved by the audit committee and submitted to the board of directors for approval and reported to the competent authority.

2022/08/09 Audit Committee The accountant explained the consolidated financial reports for 2022Q2 and the results of the financial report audits.

It has been approved by the audit committee and submitted to the board of directors for approval and reported to the competent authority.

 
[Chart 2] Summary of historical communications between independent directors and audit supervisors

Meeting Date Communication Type Communication Matters Communication Results
2020/03/24 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2019 Q4 Audit Execution Report.
  3. 2019 Annual "Declaration of Internal Control System".
No disagreement
2020/05/12 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2020 Q1 Audit Execution Report.
No disagreement
2020/08/12 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2020 Q2 Audit Execution Report.
No disagreement
2020/11/10 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2020 Q3 Audit Execution Report.
No disagreement
2020/12/15 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2021Annual Audit Plan.
No disagreement
2021/03/08 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2020Q4 Audit Execution Report.
  3. 2020 Annual "Declaration of Internal Control System".
No disagreement
2021/05/06 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2021 Q1 Audit Execution Report.
No disagreement
2021/08/12 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022 Q2 Audit Execution Report.
  3. The change of Company's internal audit supervisor.
No disagreement
2021/11/04 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022 Q3 Audit Execution Report.
  3. The change of Company's internal audit supervisor.
No disagreement
2021/12/15 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022 Annual Audit Plan.
No disagreement
2022/03/09 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2021Q4 Audit Execution Report.
  3. 2021 Annual "Declaration of Internal Control System".
No disagreement
2022/04/26 Payed Before the Audit Committee
  1. Communication of proposal.
No disagreement
2022/05/06 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022Q1 Audit Execution Report.
No disagreement
2022/08/09 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022Q2Audit Execution Report.
No disagreement
2022/11/09 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2022 Q3 Audit Execution Report.
  3. The change of Company's internal audit supervisor.
No disagreement
2022/12/22 Payed Before the Audit Committee
  1. Communication of proposal.
  2. 2023 Annual Audit Plan.
No disagreement