Investor Relations
Investor Relations
Internal Audit
Internal Audit System
The purpose of internal control is to assist the Board and the managers to examine and review the internal control system and assess operation efficiency. The internal audit function of Keystone Microtech is under the direct supervision of the Board and performs the function of internal audit in accordance with applicable internal code. The internal audit function will map out the audit plan of the coming year at the end of each year on the basis of the risk assessment result, and present to the Board for resolution, followed by the declaration and reference filing with the competent authority in accordance with the Securities and Exchange Act.
The Organization and Conduct of Internal Audit
I. The Organization of Internal Audit
(I) The Company established the internal audit function and appointed related internal auditors under the direct supervision of the Board for strengthening corporate governance and bolstering the internal control and internal audit system.
(II) The appointment and dismissal of the Chief Internal Auditor shall be reported to the Board for approval.
II. The Conduct of Internal Audit
(I) Audit Scope
The internal control system along the corporate hierarchy and the implementation of the system at all levels of the corporate hierarchy shall be subject to internal audit. Self-assessment of the internal control system shall also be subject to audit review.
(II) The Auditees
All functional units, branches, and subsidiaries of the Company
(III) Purpose of audits
The purpose of internal control is to assist the Board and the managers to examine and review the internal control system and assess operation efficiency, and also present timely recommendation for assuring the ongoing effectiveness of the internal control system. The audit findings will also be served as reference for reviewing and amending the internal control system.
(IV) Audit Method
1. The internal audit function will map out the audit plan of the coming year at the end of each year on the basis of the risk assessment result, and present to the Board for resolution.
2. Internal audit could be classified into regular audit and special audit. Regular audits refer to routine audits executed as planned. Special audit will be executed for specific purposes where necessary.
3. Internal audits shall be executed in accordance with the audit procedure under the prearranged audit program, including the audit items, timing, procedure and method.
4. The auditees shall give full support and assistance to the internal auditors when an internal audit is unfolded thereby provide all related documents, materials timely, and shall never turn down any request for the aforementioned items.
(V) Audit Reports
1. The audit findings and the procedures, and related information, shall be tracked on record in the audit worksheet. The findings shall be compiled into a written audit report.
2. Objectivity, clarity, brevity, constructiveness and timeliness will be necessary for the audit report.
3. Upon approval after reporting, audit reports shall be tracked at least once quarterly for assuring the auditee concerned has taken appropriate action as recommended timely until completion of improvement.
The communications between the Independent Directors and the independent auditors and the Chief Internal Auditor
I. Where necessary, the Chief Internal Auditor and the independent auditors may engage in direct contact. Communication between them is good.
II. The Independent Directors of the Company will receive audit reports monthly. The Chief Internal Auditor will also report to the Independent Directors on matters pertinent to the Company and its subsidiaries in the quarterly meeting. They can fully communicate with each others on the conduct of operation audits and the result.
III. The independent auditors will report to the Independent Directors in the quarterly meeting on the result of examination of the financial statements and the audit findings.
The communications between the Independent Directors and the Chief Internal Auditor in 2023
| 2023 | Matters for communication | Result of communication |
|---|---|---|
| 2023/03/06 | The independent auditors gave explanation on the separate and consolidated financial statements of 2022, and engaged in discussion with the Independent Directors. | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/05/08 | The independent auditors gave explanation on the consolidated financial statements of Q1 2023, and engaged in discussion with the Independent Directors. | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/08/07 | The independent auditors gave explanation on the consolidated financial statements of Q2 2023, and engaged in discussion with the Independent Directors. | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/11/03 | The independent auditors gave explanation on the consolidated financial statements of Q3 2023, and engaged in discussion with the Independent Directors. | All the Independent Directors in the session expressed no adverse opinion. |
The communications between the Independent Directors and the independent auditors in 2023
| 2023 | Matters for communication | Result of communication |
|---|---|---|
| 2023/03/06 | Report on the conduct of internal audit in Q4 2022 | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/05/08 | Report on the conduct of internal audit in Q1 2023 | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/08/07 | Report on the conduct of internal audit in Q2 2023 | All the Independent Directors in the session expressed no adverse opinion. |
| 2023/11/03 | Report on the conduct of internal audit in Q3 2023 | All the Independent Directors in the session expressed no adverse opinion. |
