Internal Audit

The design, implementation, and internal audit of the company's internal control system are handled in accordance with the guidelines and relevant laws and regulations of the internal control system established by the public issuing company.

Purpose of internal audit

The purpose of the internal audit is to assist the Board of Directors and the management to examine and review the deficiencies of the internal control system and to measure the effectiveness and efficiency of the operation, reliability, timeliness, transparency, and regulatory compliance of reporting, to provide timely suggestions for improvement to ensure the continuous and effective implementation of the internal control system and to serve as a basis for reviewing and amending the internal control system to promote the sound operation of the Company.

Internal Audit Organization and Staffing

The Internal Audit unit which is in the Office of Internal Audits be affiliated with the board of directors. A chief internal auditor is appointed or dismissed on the agreement of the company’s board of directors. According to Article 3 of the Corporate Governance Best Practice Principles, appointment, dismissal, evaluation and review, salary and compensation of internal auditors shall be submitted by the chief internal auditor to the president for approval. The Corporate Governance Best Practice Principles are disclosed under the Corporate Governance section on the company website. The auditors’ information, such as the names, ages, educational background, experience, seniority, and training shall report to the FSC by the end of January each year via the Internet-based information system.

Operation of Internal Audits

 I. Implementation of Internal Audits

1. The Office of Internal Audits shall draw up the next annual audit plan according to the risk assessment results each year, including the items listed in Article 13 of the “Regulations Governing Establishment of Internal Control Systems by Public Companies” as the annual audit plan.
2. The Office of Internal Audits shall check the implementation of the audit items in the annual audit plan monthly, submit the audit report and transmit the report to the supervisors and independent directors for review.
3. The Office of Internal Audits shall present a report on its internal audit business at the quarterly board of directors meeting.
4. The Office of Internal Audits shall urge each unit to conduct self-assessment at least once a year. Each unit shall fill out its self-assessment report. The Office of Internal Audits shall verify first and then submit it to the general manager and the chairperson for further review. The results of the self-assessment report shall serve as the primary basis for evaluating the effectiveness of the overall internal controls and issuing the Statement on Internal Control.

II. The Regular Internet Information System Report of Internal Audit

1. Reporting the basic information of the internal auditors in the current year and the training in the previous year to the FSC at the end of every January.
2. Reporting the implementation of the audit plans in the previous year to the FSC at the end of every February.
3. Reporting the Statement on Internal Control in the previous year to the FSC at the end of every March.
4. Reporting the improvement of internal controls deficiency and abnormality in the previous year to the FSC at the end of every May.
5. Reporting the audit plans for the following year to the FSC at the end of every December.

Internal auditing and communicate with independent directors