Internal Audit

The Purpose of Internal Audit

To assist the Board of Directors to review the internal audit procedures and evaluate effectiveness and efficiency of the operation. The Internal Audit proposes recommendation adequately to ensure the internal audit policy executed in an effective and efficient manner.

Internal Audit Organization

The internal audit unit of the company is subordinate to the Board of Directors, and shall appoint qualified staff as a supervisor. According to its business size, business condition, management needs, and the provisions of other applicable laws and regulations, qualified persons in an appropriate number as full-time internal auditors.

Appointment, dismissal, evaluation and review, salary and compensation of internal auditors except for the appointment and dismissal of the chief internal auditor shall be subject to approval by the audit committee and be submitted to the board of directors for a resolution, the other items are approved by the chairman of the board.

Operation of Internal Audit

• 01.
• The Company has established and carries out “internal control systems,” “internal audit implementation rules” and “procedures and methods for self-inspection operations” according to the Regulations Governing Establishment of Internal Control Systems promulgated by the Securities and Exchange Act.

• 02.
• Regular report of audit business to the audit committee and the board of directors, and submission of a written report to the audit committee and the board of directors on the implementation of improvement of audit deficiencies brought up by the Competent Authority, CPA and internal audit, and on matters specified in the internal control system statement for stronger improvement efforts.

• 03.
• Audits are conducted based on audit schemes passed by the Board of Directors. Other project audits will be performed when necessary. General audits and project audits are conducted to provide the operation status and existing shortcomings or potential risks in time for internal control performed by management-level personnel.

• 04.
• Internal audits cover self-assessments performed by each unit and subsidiary. Such activities shall include verifying whether relevant operations are performed and related documents are reviewed to ensure performance quality. Self-assessment results shall be integrated and reported to the Board of Directors and the President as a basis for judging the effectiveness of the internal control and issuing declarations of effective control systems.

• 05.
• Internal audit related information have been punctually filed and publicly announcements over the Market Observation Post System (MOPS).