Communications between the independent directors, the Company’s chief internal auditor and CPAs
SYSTEX’s Audit Committee shall be solely composed of Independent Directors and meetings shall be convened at least once a quarter. Ad-hoc meetings shall be held whenever necessary.
Communication between the chief internal auditor and the Audit Committee
- Periodic:
- Report the findings in audits and the status of improvement on irregularities to the Audit Committee; respond to all questions submitted by the Independent Directors, and enhance the contents of auditing tasks in accordance with their instructions to ensure the effectiveness of the internal control system.
- Independent directors review the deficiencies in the internal control system and hold regular discussions with internal auditors.
- Non-periodic: Use telephone, email, or face-to-face communication to communicate discoveries in the audits and how to continuously increase the value of audits. In the event of material violation, the Independent Directors shall be notified immediately.
- Summaries of communication in 2024:
|
Date |
Communication Content |
Results |
|
Audit Committee |
The implementation of audit program from January to February, 2024. |
Noticed. |
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The amended the Internal Control System. |
Approved and referred to the Board. |
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The “Statement of Internal Control System” for 2023. |
Approved and referred to the Board. |
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|
Audit Committee |
The implementation of audit program in March, 2024. |
Noticed. |
|
Audit Committee |
The implementation of audit program in April, 2024. |
Noticed. |
|
Audit Committee |
The implementation of audit program from May to July, 2024. |
Noticed. |
|
Symposium on December 17, 2024 |
Audit operation. |
Strengthen internal control systems based on overall audit findings, optimize audit management systems and IPO subsidiary supervision. |
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ESG and Audit – Management of Sustainability Information. |
Revise the internal control system and include it in the annual audit plan according to the schedule specified by the competent authority. |
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Corporate Governance – Board Performance Evaluation. |
Refer to the recommendations of Taiwan Corporate Governance Association. |
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Important laws and regulations. |
Refer to the regulations of the competent authorities. |
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Audit Committee |
The implementation of audit program from October to December, 2024. |
Noticed. |
|
The Audit program for 2025. |
Approved and referred to the Board. |
|
|
The amended the Internal Control System. |
Approved and referred to the Board. |
Communication between the CPAs and the Audit Committee
- Periodic: The CPAs shall communicate with the Audit Committee on the audit plan, execution status, and results in the periods before and after the semi-annual and annual audit reports.
- Non-periodic: Meetings may be arranged in the event that operations or internal controls require immediate communication on related cases.
- Summaries of communication in 2024:
|
Date |
Item |
Communication Content |
Results |
|
February 27, 2024 |
Financial statement for year 2023 |
Consolidated and Unconsolidated Financial Statements for Year 2023. |
Report the audited adjustments of Year 2023 Financial Statement. |
|
Key audit items |
The impairment evaluation for accounts receivable were the key audit items in 2023. |
The most important items of SYSTEX Group’s 2023 Consolidated Financial Statements as per the professional judgment of the CPA. |
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Information on the quality management system from the accounting firm |
The information on the quality management system provided by the accounting firm to external parties (including communicating to the corporate governance unit on how the system helps with the consistent execution of quality cases). |
The Company fully understands that Deloitte & Touche has performed the assessment in accordance with ISQM 1 / TWSQM 1, that the accounting firm and its personnel have fulfilled their responsibilities in accordance with professional standards and applicable laws and regulations, and that they have handled this case in accordance with such standards and laws and regulations. The firm or project partners were able to issue appropriate reports in accordance with the circumstances at the time. |
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Application of Audit Quality Indicators |
Article 29 of the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies: A TWSE/TPEx listed company shall, based on Audit Quality Indicators (AQIs) as reference, evaluate the independence and suitability of the CPA engaged by the company regularly, and no less frequently than once annually. The FSC is promoting audit quality transparency by introducing audit quality indicators. Accounting firms undertaking audit engagements for the financial reports of listed and OTC companies for the year 2023 will provide AQI information for the reference of the Audit Committee. |
The Company fully understands that Deloitte & Touche has disclosed the five dimensions and thirteen AQIs listed in the AQI Disclosure Framework and the AQI Disclosure Template announced by the FSC, and has disclosed information on the “Firm Level” and the “Engagement Level” based on the nature of the AQIs. The accounting firm provides information on the AQIs: 1. Profession, 2. Quality Control, 3. Independence, 4. Monitoring, and 5. Innovation. This information will be reported to the Audit Committee. |
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August 6, 2024 |
Financial Statements for the Second Quarter Ended of 2024 |
Consolidated Financial Statements for the Second Quarter Ended of 2024. |
Report the adjustments of financial statements for the Second Quarter Ended of 2024. We discuss and communicate the newly-announced “Statements on Auditing Standards” and the amendment of decree. |
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Identification and declaration of major subsidiaries |
According to the ninth question in the Frequently Asked Questions on Applying for Major Subsidy Declarations, major subsidiaries should be judged and identified based on their consolidated financial statement information. |
The cumulative consolidated revenue of Systex Information (H.K.) Ltd. in the second quarter of 2024 accounted for more than 16% of the Group’s consolidated revenue, and it has met the standards for a major subsidiary for two consecutive years. Therefore, in accordance with regulations, this change in status as a major subsidiary will be reported together with the annual financial report. |
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Implementation schedule for IFRS Sustainability Disclosure Standards S1 and S2 |
To apply international sustainability standards and provide investors with trustworthy sustainability information, the FSC released the Roadmap for Taiwan Listed Companies to Align with IFRS Sustainability Disclosure Standards on August 17, 2023, and SYSTEX will be affected starting in 2028. |
SYSTEX will disclose sustainability-related information in accordance with the timetable for aligning with the IFRS sustainability standards disclosures announced by the FSC, and will fully integrate this sustainability information in the 2028 annual report to be published in 2029. |