Internal Audit

1. Internal Audit Organization

Chenbro's Internal Audit function is an independent unit that reports directly to the Board of Directors, and shall appoint, according to its business size, business condition, management needs and the provision of other applicable laws and regulations, qualified persons in an appropriate number as full-time internal auditors. Any appointment or dismissal of chief internal auditor shall be subject to approval by the board of directors.

2. The purpose of Internal Audit

Chenbro shall carry out internal audits to assist the board of directors and mangers in inspecting and reviewing defects in the internal control systems as well as measuring operational effectiveness and efficiency, and shall make timely recommendations for improvements to ensure the sustained operating effectiveness of the systems and to provide a basis for review and correction.

3. The operation of Internal Audit

The procedures of the internal audit complies with Regulations Governing Establishment of InternalControl Systems by Public Companies and the Corporations’ rules of Internal Audit.
The internal auditors shall be detached, independent, objective, and impartial, in faithfully performing their duties, and shall exercise due professional care.
The Internal Audit shall formulate annual audit plans based on the results of the risk assessment, including matters to be audited monthly, and execute the plans after approval by the Board of the Directors.
Submission and report of the Audit Report
The internal auditors shall communicate fully with the audited unit regarding the inspection results of the annual audit items, and shall faithfully disclose in audit reports any defects and irregularities of the internal control systems discovered in assessment and, after having presented the reports, follow up on the matters and prepare follow-up reports at least on a quarterly basis until such time as correction is made, to ensure that the relevant departments have taken appropriate corrective measures in a timely manner.
Internal auditors discovering any material violation or any likelihood of material damage to the company shall promptly prepare and present a report and notify the Directors and Supervisors.
After having presented the audit and follow-up reports, this Corporation shall submit the same for review by the Directors and Supervisors by the end of the month next following the completion of the audit items.
In addition to reporting their audit operations to each Supervisor, Independent Director and Chairman on a regular basis, the internal audit officer shall also attend and deliver a report to a board of directors meeting.
Self-assessment of the internal control systems
This Corporation shall first see that all internal departments and subsidiaries conduct self-assessments at least once each year, have its internal audit departments review the self-inspection reports prepared by all departments and subsidiaries.
This Corporation shall conduct annual self-assessment of the design and operating effectiveness of its internal control systems, and submit to Board of Directors for approval within 3 months from the end of each fiscal year in the prescribed format, and shall publicly announce and report the Internal Control System Statement on the websites designated by the FSC.
Reporting based on the prescribed format on the websites designated by the authority.
Shall submit its next year's audit plan approved by the Board of Directors by the end of each fiscal year
Shall submit the names, ages, educational background, experience, seniority and training of its internal auditors by the end of January each year
Shall submit the report on the execution of its previous year's annual audit plan within 2 months from the end of each fiscal year
Shall submit Statement of Internal Control Systems within 3 months from the end of each fiscal year
Shall report its corrections of any defects and irregularities of the internal control system discovered during the past year's internal auditing within 5 months from the end of each fiscal year
Shall report the change and the reasons for it within 2 days from the date of occurrence when there is a change in the chief internal auditor