Internal audit purposes

The Internal Audit unit is an independent unit that reports directly to the Board of Directors.  The primary duty is to assist the Board and management team inspect, evaluate the effectiveness of the internal control system, measure efficiency and effectiveness of operation, and provide timely improvement suggestions to ensure continuous and effective implementation of various kinds of systems.

 

Internal Audit Organization

CMSC shall set up an internal audit unit subordinate to the Board of Directors. The internal auditors shall be full-time. CMSC shall allocate a competent and appropriate number of full-time internal auditors, according to the company's scale, business situation, management needs and other relevant laws and regulations and shall set up an audit agent.

The appointment and dismissal of the chief of internal auditor shall be approved by the Audit Committee and submitted to the Board of Directors for resolution. The performance appraisal and remuneration of the chief of internal auditor shall be approved by the Remuneration Committee and submitted to the Board of Directors for resolution.
The Internal auditors shall continue education and training and participate in internal audit seminars held by FSC-accredited institutions every year to ensure their suitability. The name, age, education background, experience, seniority and training of the internal auditors shall also be reported to FSC for future reference by the end of January every year via online information system.

 

Internal audit operations

Periodic audits are conducted by the audit unit in accordance with the annual audit plan approved by the Board of Directors. Annual audit plan shall be formulated according to risk assessment results; unscheduled audits are conducted as needed. The deficiency and irregularities of internal control system found in the audit shall be tracked and reported regularly to ensure that relevant units have taken appropriate improvements immediately.
The internal auditors shall supervise each unit to self-evaluate the implementation of internal control system regularly, review its self-assessment report, and thus from a major basis for Audit Committee and Board of Directors to evaluate the effectiveness of overall internal control system as well as to make a statement of internal control system.

The Internal auditors shall be detached, independent, objective, and impartial, in faithfully performing their duties, and shall exercise due professional care. In addition to reporting their audit operations to each independent director, the chief internal auditor shall also attend and deliver a report to a meeting of the Board of Directors.