Common use of Functions of the Parties Clause in Contracts

Functions of the Parties. The Hong Kong Police 3.1 The general duties and powers of the HKP are primarily set out in the PFO. The HKP, in the performance of its general Functions under the PFO, is responsible for maintaining law and order and preventing and detecting crimes in Hong Kong. 3.2 The FRC is a statutory body established under the FRCO. The FRC’s main Functions relevant to this MoU are: (1) to regulate auditors of Listed Entities through the following means: (a) by a system of registration and recognition whereby (i) Hong Kong and non-Hong Kong auditors of PIEs are required to be registered and recognized respectively as PIE Auditors; and (ii) such registration and recognition is required to be renewed annually; (b) by conducting inspections of PIE Auditors’ internal quality control systems and selected engagements to ensure compliance with professional standards and the provisions of the FRCO; (c) by conducting investigations into possible Misconduct by PIE Auditors and Registered Responsible Persons including Practice Irregularities for consideration of disciplinary sanctions; (d) by conducting investigations into possible Practice Irregularities by non-PIE Auditors; and (e) by imposing disciplinary sanctions for Misconduct; and (2) to monitor the compliance by Listed Entities of regulatory requirements for financial reports by conducting Enquiries and preparing reports thereon, ensuring that any Relevant Non- compliance is remedied; and referring the reports to other appropriate authorities for follow-up action where necessary. 3.3 Upon the commencement of the Financial Reporting Council (Amendment) Ordinance 2021 on a date to be appointed by the Secretary for Financial Services and the Treasury, the FRC and FRCO will be renamed as the AFRC and AFRCO respectively. The AFRC will become the independent regulator of the accounting profession in Hong Kong and will assume the following additional Functions relevant to this MoU: (1) issuance of practising certificates to CPAs; (2) registration of CPA firms (as defined in the AFRCO) and corporate practices (as defined in the AFRCO); (3) inspection of Practice Units; and (4) investigation and discipline of all CPAs and Practice Units in relation to CPA Misconduct. 3.4 This MOU shall remain in full force and effect and continue to apply notwithstanding the coming into effect of the Financial Reporting Council (Amendment) Ordinance 2021 but all references in this MoU to “FRC” shall read “AFRC” and all references to “FRCO” shall read “AFRCO”. This shall mean that where any terms are defined in this MoU with reference to the FRCO, these terms shall henceforth be defined with reference to the AFRCO instead. 3.5 The FRC is committed to upholding the quality of financial reporting and audit quality in Hong Kong, so as to enhance protection for investors, deepen investor confidence in corporate reporting and promote a fair and ethical business environment in Hong Kong.

Functions of the Parties. The Hong Kong Police 3.1 The ICAC was established under the ICACO as an independent anti-corruption agency accountable directly to the Chief Executive of Hong Kong. It is the statutory duty of the ICAC to, among other things, investigate corrupt practices and offences under ICACO, Prevention of Bribery Ordinance, Cap. 201 and Elections (Corrupt and Illegal Conduct) Ordinance, Cap. 554. 3.2 Pursuant to the general duties and powers of the HKP are primarily as set out primarily in the PFO. The HKPabove- mentioned Ordinances, in the performance of its general Functions under the PFOICAC is committed to fighting corruption through effective law enforcement, is responsible for maintaining law education and order prevention to help keep Hong Kong fair, just, stable and preventing and detecting crimes in Hong Kongprosperous. 3.2 3.3 The FRC is a statutory body established under the FRCO. The FRC’s main Functions functions relevant to this MoU are: (1) to regulate auditors of Listed Entities through the following means: (a) by a system of registration (implemented by the Hong Kong Institute of Certified Public Accountants and overseen by the FRC) and recognition whereby (i) Hong Kong and non-Hong Kong auditors of PIEs Listed Entities are required to be registered and recognized respectively as PIE Auditors; and (ii) such registration and recognition is required to be renewed annually; (b) by conducting inspections of PIE Auditors’ internal quality control systems and selected engagements to ensure engagements, for compliance with professional standards and the provisions of the FRCO; (c) by conducting investigations into possible Misconduct by PIE Auditors and Registered Responsible Persons including Practice Irregularities for consideration of disciplinary sanctions;, and (d) by conducting investigations into possible Practice Irregularities by non-PIE Auditors; and (e) by imposing disciplinary sanctions for Misconduct; and. (2) to monitor the compliance by Listed Entities of regulatory requirements for financial reports by conducting Enquiries and preparing reports thereon, ensuring that securing the removal of any Relevant Non- compliance is remediedNon-compliance; and referring the reports to other appropriate authorities for follow-up action where necessary. 3.3 Upon the commencement of the Financial Reporting Council (Amendment) Ordinance 2021 on a date to be appointed by the Secretary for Financial Services and the Treasury, the FRC and FRCO will be renamed as the AFRC and AFRCO respectively. The AFRC will become the independent regulator of the accounting profession in Hong Kong and will assume the following additional Functions relevant to this MoU: (1) issuance of practising certificates to CPAs; (2) registration of CPA firms (as defined in the AFRCO) and corporate practices (as defined in the AFRCO); (3) inspection of Practice Units; and (4) investigation and discipline of all CPAs and Practice Units in relation to CPA Misconduct. 3.4 This MOU shall remain in full force and effect and continue to apply notwithstanding the coming into effect of the Financial Reporting Council (Amendment) Ordinance 2021 but all references in this MoU to “FRC” shall read “AFRC” and all references to “FRCO” shall read “AFRCO”. This shall mean that where any terms are defined in this MoU with reference to the FRCO, these terms shall henceforth be defined with reference to the AFRCO instead. 3.5 The FRC is committed to upholding the quality of financial reporting of Listed Entities in Hong Kong and the audit quality in Hong Kongof PIE Auditors, so as to enhance protection for investors, investors and deepen investor confidence in corporate reporting and promote a fair and ethical business environment in Hong Kongreporting.