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The Audit Committee

In order to enhance the supervisory function of the board of directors and establish a sound management mechanism, the company has established an Audit Committee in May 2022 in accordance with the "Regulations Governing the Exercise of Powers by Audit Committees of Publicly Issued Companies." The Audit Committee is composed of three independent directors, namely Mr. Hong Mingzhou, Mr. Hu Tonglai, and Ms. Zhu Wenyi. Mr. Hong Mingzhou serves as the convener of the committee.

Summary of Annual Focus of the Audit Committee

The Audit Committee of the company was officially established in May 2022. In 2022, the committee held three meetings with a 100% attendance rate. The main deliberations of the committee included the following:

  1. Internal control systems, policies, and procedures.
  2. Annual audit plan.
  3. Fundraising or issuance of securities.
  4. Investments in derivative financial instruments.
  5. Overview of subsidiary company operations.
  6. Assessment of independence and qualifications of the auditors.
  7. Appointment and remuneration of auditors.
  8. Review of financial reports.
  9. Significant matters stipulated by regulatory authorities.

Appointment of Auditors

To ensure the independence and qualifications of auditors, an assessment form for independence and qualifications was developed, taking into account Article 47 of the Accountant Act and Bulletin No. 10 of the Code of Professional Ethics for Accountants on "Integrity, Fairness, Objectivity, and Independence." The assessment form is accompanied by the use of Audit Quality Indicators (AQI) to evaluate and measure information. Additionally, information regarding the auditor's education, experience, and professional qualifications is provided for review by the Audit Committee. The appointment of auditors for the 2023 financial statements has been reviewed by the Audit Committee. The assessment included evaluating the auditor's education, experience, independence, qualifications, and compliance with audit quality indicators. All criteria were found to meet the standards, and the appointment of the auditor for the financial statement certification was approved during the review.

The financial statements have undergone a review process.

The 2022 financial statements have been audited by Ernst & Young Certified Public Accountants. They have issued an audit report, and the financial statements have been reviewed and approved by the Audit Committee.

Compensation Committee

In order to strengthen corporate governance and the functioning of the board of directors, Rongcheng has established a Compensation Committee in accordance with the 'Regulations on the Establishment and Exercise of Powers of the Compensation Committee of Companies Listed on the Stock Exchange or Engaged in Securities Trading at Securities Business Places.' The committee, in a professional and objective position, evaluates the compensation policies and systems for directors, supervisors, and executives, and provides recommendations to the board of directors for their decision-making.

According to the provisions of the Compensation Committee's organizational charter, this committee was approved by the board of directors in May 2022, and Hong Mingzhou, Hu Tonglai, and Zhu Wenyi were appointed as members of the fifth-term Compensation Committee. Mr. Hu Tonglai serves as the convener. Three meetings of the Compensation Committee were held in 2022, with a 100% attendance rate.

Remuneration of directors and supervisors and remuneration of employees

  1. According to the company’s articles of association, if annual profits are made, 5% to 15% shall be llocated as employee compensation and no more than 2% of profit from Winmate shall be allocated for irectors and supervisors' remuneration by the resolution of the board of directors.
  2. Employee remuneration shall be paid in stock or cash by the resolution of the board of directors, and the payment objects include employees of controlling or affiliated companies that meet certain conditions.
  3. Winmate’s salary and remuneration policy considers "employee salaries and company operations to grow together" to implement Environmental, Social and Corporate Governance. Employee salary includes basic salary and bonus. Basic salary considers work experience, ability, position, etc., and does not vary with gender, age, nationality or race. Year-end bonuses are issued based on the company's annual business performance and employee personal performance.
  4. The company's remuneration procedures have taken into consideration the performance evaluation results of directors, supervisors and managers. The distribution of the remuneration of directors, supervisors and managers is linked to the results of the current year's performance evaluation, which is submitted to the remuneration committee for review and sent to the board of directors for resolution .

The following tables respectively illustrates the the remuneration of Winmate's directors and supervisors and senior managers, analysis as well as the remuneration policies, standards and combinations, procedures for determining remuneration, and the relevance to operating performance and future risks.

yearly Net revenue Net profit after tax Board of Directors's honorarium (The total amount represents the net benefit after tax.) General Manager's Deputy General Manager's Honorary (The total amount represents the net benefit after tax.)
2020 1,845,525 256,062 2.33% 9.11%
2021 2,501,627 364,706 2.33% 7.33%
2022 2,659,296 452,429 2.50% 6.80%

Illustrate Honorariums for directors General Manager's Deputy General Manager's Honorary
Remuneration policy The remuneration of the directors and supervisors shall be allocated in accordance with the company's articles of association. In addition, the remuneration of directors and supervisors shall not be paid. Any additional appropriations and changes shall be subject to the resolution of the shareholders meeting. According to the company's "performance appraisal and rewards and punishments evaluation work", "promotion and transfer work" and "payroll cycle work" and other methods.
Standards and combinations Allocation of weights for the responsibilities of directors in performing business duties and fiduciary duties. Monthly salary, annual holiday bonus, performance bonus, employee remuneration, etc.
Procedure for setting remuneration The board of directors drafts a surplus distribution proposal and submits it to the shareholders meeting for resolution. Salaries are based on differences in academic experience and work performance, and signed according to the company's approval authority.
Business performance and future risks Depend on the company's operating performance and profitability. Supervise business operations, formulate business policies, and grasp business opportunities. Relevant remunerations are paid based on the achievement rate of work goals, the operating performance of individual departments, profitability, and contribution. Achieve the goal and face the risk together.