In order to strengthen and standardize the internal control of enterprises, improve the management level and risk prevention ability of enterprises, promote the sustainable development of enterprises, and safeguard the order of socialist market economy and social public interests, according to relevant national laws and regulations, the Ministry of Finance, together with the CSRC, the Audit Commission, the China Banking Regulatory Commission and the China Insurance Regulatory Commission, formulated the Basic Standards for Internal Control of Enterprises. It is hereby issued and implemented within the scope of listed companies from July 1 2009, encouraging large and medium-sized unlisted enterprises to implement it. A listed company implementing these Standards shall conduct self-evaluation on the effectiveness of internal control, disclose the annual self-evaluation report, and may hire an accounting firm with securities and futures-related business qualifications to audit the effectiveness of internal control.

If there are any problems in the implementation, please feedback us in time.

Basic norms of enterprise internal control

Chapter I General Principles

Article 1 In order to strengthen and standardize the internal control of enterprises, improve the management level and risk prevention ability of enterprises, promote the sustainable development of enterprises and safeguard the order of socialist market economy and public interests, these Standards are formulated in accordance with the Company Law of People's Republic of China (PRC), the Securities Law of People's Republic of China (PRC), the Accounting Law of People's Republic of China (PRC) and other relevant laws and regulations.

Article 2 These Standards are applicable to large and medium-sized enterprises established in People's Republic of China (PRC).

Small enterprises and other units can establish and implement internal control with reference to this specification.

The criteria for the division of large and medium-sized enterprises and small enterprises shall be implemented in accordance with the relevant provisions of the state.

Article 3 Internal control as mentioned in these Standards refers to the process implemented by the board of directors, the board of supervisors, the managers and all employees of an enterprise to achieve control objectives.

The goal of internal control is to reasonably ensure the legality and compliance of enterprise management, the safety of assets, the truthfulness and completeness of financial reports and related information, improve operating efficiency and benefit, and promote the realization of enterprise development strategy.

Article 4 An enterprise shall follow the following principles when establishing and implementing internal control:

(1) Comprehensive principle. Internal control should run through the whole process of decision-making, implementation and supervision, covering all businesses and matters of the enterprise and its subordinate units.

(2) the principle of importance. Internal control should focus on important business matters and high-risk areas on the basis of comprehensive control.

(3) the principle of checks and balances. Internal control should restrict and supervise each other in governance structure, organization setting, power and responsibility distribution and business process. , taking into account operational efficiency.

(4) the principle of adaptability. Internal control should be adapted to the business scale, business scope, competition and risk level of the enterprise, and be adjusted in time with the changes of the situation.

(5) The principle of cost-effectiveness. Internal control should weigh the implementation cost and expected income to achieve effective control at an appropriate cost.

Article 5 The establishment and implementation of effective internal control by an enterprise shall include the following elements:

(1) internal environment. Internal environment is the basis for enterprises to implement internal control, which generally includes governance structure, institutional setup and distribution of powers and responsibilities, internal audit, human resources policy, corporate culture and so on.

(2) Risk assessment. Risk assessment refers to the timely identification and systematic analysis of risks related to the realization of internal control objectives in business activities, and the reasonable determination of risk response strategies.

(3) control activities. Control activities refer to enterprises taking corresponding control measures according to the results of risk assessment, so as to control risks within an acceptable range.

(4) Information and communication. Information and communication refers to the timely and accurate collection and transmission of information related to internal control in order to ensure effective communication between enterprises and the outside world.

(5) Internal supervision. Internal supervision refers to the supervision and inspection of the establishment and implementation of internal control, evaluation of the effectiveness of internal control, discovery of internal control defects, and timely improvement.

Article 6 An enterprise shall formulate its own internal control system and organize its implementation in accordance with relevant laws and regulations, these Standards and its supporting measures.

Article 7 An enterprise shall use information technology to strengthen internal control, establish an information system suitable for operation and management, promote the organic combination of internal control process and information system, realize automatic control of business and matters, and reduce or eliminate human manipulation factors.

Article 8 An enterprise shall establish an incentive and restraint mechanism for the implementation of internal control, incorporate the implementation of internal control of all responsible units and all employees into the performance appraisal system, and promote the effective implementation of internal control.

Article 9 The relevant departments of the State Council may, in accordance with laws and regulations, these Standards and their supporting measures, specify the specific requirements for the implementation of these Standards, and supervise and inspect the establishment and implementation of internal control of enterprises.

Article 10 An accounting firm entrusted by an enterprise to engage in internal control audit shall audit the effectiveness of internal control of an enterprise and issue an audit report in accordance with these Standards and its supporting measures and relevant professional standards. Accounting firms and their signatories shall be responsible for the internal control audit opinions published.

An accounting firm that provides consulting for enterprise internal control shall not provide internal control audit services for the same enterprise at the same time.