INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. To regulate the performance of connected transactions of the Company, the Company has formulated the Rules for Connected Transactions of China Railway Signal & Communication Corporation Limited* 《(中國鐵路通信信號股份有限 公 司 關 聯 交 易 管 理 制 度 》), and adopted a series of internal control and corporate governance measures in its daily operation. Such measures in relation to the Construction Contracting Framework Agreement mainly include the following:
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. The Company would strive to exercise stringent monitoring over the transaction amounts and respective annual caps of (1) the Futures Brokerage Services Framework Agreement, (2) the Asset Management Services Framework Agreement, (3) the Risk Management Services Framework Agreement, and (4) the Bulk Commodities Sale and Purchase Framework Agreement between the Group and Shandong Energy to ensure that necessary measures and appropriate actions can be timely taken in order to comply with the requirements of the Listing Rules. The Company has adopted the following internal management procedures to ensure that the Continuing Connected Transactions under the Framework Agreements are fair and reasonable and are entered into on normal commercial terms: • The Group has formulated a series of measures and policies, among others, contract policies, project management policies and administration rules of Connected Transactions in order to ensure that the Company’s Continuing Connected Transactions are conducted under such Framework Agreements and the respective pricing policies. The fairness and reasonableness of the transactions contemplated under the agreements of Continuing Connected Transactions, in particular the pricing terms thereof, would be examined and approved by the audit committee of the Board, the Board and various internal departments of the Company (including but not limited to the finance department and audit department of the Company) to ensure that the terms of Framework Agreements are in compliance with relevant regulations and guidelines (if applicable) and market practices and would not deviate from the terms of the Framework Agreements disclosed in this announcement. • When determining the actual prices of products supplied by Shandong Energy and/ or its associates, the above counter-party will offer a proposed price to the Company for consideration first. As mentioned above, in order to ensure that the pricing terms under the agreements of Continuing Connected Transactions are fair and reasonable, the proposed price will be first evaluated and approved by the finance department, audit department and various relevant business departments of the Company. In addition, the transactions under the Framework Agreements shall be conducted on a non-exclusive basis. Payments shall be made on the aforementioned pricing principles basis. However, the Group usually seeks quotations or makes enquiries on relevant prices from no less than two other independent...
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. The referral arrangement is also available to Independent Third Parties (including employees of the Group), subject to definitive agreements to be entered with each individual with similar terms and conditions. As such, the Group has the flexibility to enter into arrangement with the Independent Third Parties. Whether the referral transactions are contemplated with Independent Third Parties or with connected persons under the MRA, the Group will follow a series of procedures in relation to the determination of the Referral Fees. Each transaction shall be conducted on a non-exclusive basis. The Directors will (i) review the relevant definitive agreements and the terms and conditions therein before execution; and (ii) review the list of eligible merchandises, monitor the sales amounts, products and rates of Referral Fees to be offered to the counter-parties periodically. To ensure the fairness of the relevant transactions with connected persons under the MRA, the Directors will regularly compare the rates of Referral Fees offered to connected persons to make sure that they will not be more favourable than those offered to Independent Third Parties. Referral Fees will be paid upon obtaining of approval from the senior management regardless of Independent Third Parties or Associate Group Members. With the above control procedures, the Directors consider that the transactions in relation to the MRA are conducted on normal commercial terms and in the interests of the Company and the Shareholders as a whole. Further to the above, to ensure compliance with the terms and conditions of the MRA and adherence to the Listing Rules, the Company has implemented a comprehensive review process, including (i) the management of the Group will assess each of specific agreements with the aforementioned procedures; (ii) the finance department of the Group will record the transaction amounts to ensure that the transaction amounts under the MRA will not exceed the Annual Caps;
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. The Company has adopted the following internal control measures to supervise the continuing connected transactions of the Company as contemplated under the Strategic Cooperation Framework Agreement. Prior to entering into individual factoring agreements with the relevant COFCO Group Companies or their creditors/suppliers, the Company will review and assess the specific terms and conditions of the individual agreements to ensure their consistency with the Strategic Cooperation Framework Agreement. The relevant authorized departments of the Company will trace, monitor and check the progress of the daily balance outstanding on a continuous basis, to ensure that the actual transaction amount does not exceed the Annual Cap at any time. In addition, the Audit Committee of the Company will strictly review the Company’s continuing connected transactions on a regular basis to ensure the integrity and effectiveness of the internal control measures regarding the continuing connected transactions. The Audit Committee will also review the annual report and financial report which consist of the implementation of and opinions on the continuing connected transactions during the relevant period in respect of the fairness of the continuing connected transactions and whether the actual transaction amounts incurred are within the annual caps. The Board considers that the above internal control procedures and corporate governance measures adopted by the Company concerning the continuing connected transactions are appropriate.
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. Deposit Services The Company has adopted internal control and monitoring procedures relating to the deposit services, including: (i) before entering into any deposit arrangements with Huafa Finance Company, the Company will negotiate with Huafa Finance Company on an arm’s length basis in respect of the deposit interest rate of the deposit services, and ensure that such interest rate is determined: (1) by reference to and is not lower than the benchmark interest rate then published by the PBC for deposits of same term and same type and in case of any change in the benchmark deposit interest rate, the deposit interest rate to be payable by Huafa Finance Company shall be determined by reference to and not lower than such benchmark deposit interest rate; and (2) by reference to and is not lower than the deposit interest rate offered by at least four other independent domestic commercial banks in the PRC for deposit services of the same type on normal commercial terms. As such, the Company will be able to ensure the deposit interest rate of the deposit services will not be less favourable than that published by the PBC for deposits of same term and same type and that offered by four other independent domestic commercial banks in the PRC for deposits of same term and same type; in the event that upon receiving deposit certificate which shows the deposit interest rate offered by Huafa Finance Company, and the Company notes that the deposit interest rate offered by Huafa Finance Company is lower than the then negotiated deposit interest rate offered by the PBC, the Company will require Huafa Finance Company to provide the differences in the interest portion to the Company; (ii) finance department of the Company will monitor the deposit services on a daily basis to ensure the proposed annual cap will not be exceeded; (iii) finance department of the Company will report to the management of the Company, giving an update of the deposit arrangements entered into with Huafa Finance Company on a monthly basis; (iv) the Directors (including the independent non-executive Directors) will review the transactions contemplated under the Financial Services Agreement and its proposed annual cap each year, to ensure that the transactions contemplated under the Financial Services Agreement are conducted in the ordinary and usual course of business of the Company on normal commercial terms and in the interests of the Company and the Shareholders as a whole; and (v) the auditor of t...
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. In order to ensure that the Company strictly abides by the above pricing policy, the Company will adopt various internal control measures in the daily procurement business. These measures were carried out and monitored by the Company’s functional departments (mainly the internal audit department, supported by the finance department and the legal affairs department):
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. To ensure the Company’s conformity with the above pricing policies in relation to the continuing connected transactions contemplated under the Renewed Ship Charter Framework Agreement and the Property Leasing Framework Agreement from time to time, the Company has adopted and would continue to strengthen a series of internal control policies for its daily operation. In respect of such continuing connected transactions, the internal control policies are conducted and supervised by the financial department of the Company, who are responsible for (i) collecting detailed information (including but not limited to the pricing terms, payment arrangements and actual transaction amount under each of the individual contracts/agreements) of the continuing connected transactions on a regular basis; (ii) monitoring whether the transaction terms and pricing and other terms under each of the individual contracts/agreements are consistent with the principles established under the framework agreements in respect of the continuing connected transactions;
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. In order to protect the interests of the Shareholders, the Group has adopted the following internal control procedures and corporate governance measures in relation to its utilisation of Sinochem Finance’s services:
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. The Company has adopted internal control and monitoring procedures relating to the factoring business cooperation, including:
INTERNAL CONTROL PROCEDURES AND CORPORATE GOVERNANCE MEASURES. Loan services The internal control procedures adopted by the Company in relation to the loan services include, among others, during a certain period of time before the financing, the Company will take the initiative to locate independent domestic commercial banks in the PRC, inquire about the financing costs, undergo a comprehensive comparison according to the preferential conditions and interest rates and financing procedures given by each independent domestic commercial bank in the PRC in the negotiation process to determine the optimal choice to ensure that the company financing is the most cost-effective financing.
