Communications Between The Independent Directors, The Internal Auditors And CPAs-DARFON

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Communications Between The Independent Directors, The Internal Auditors And CPAs

The policy of the communication.

The independent directors and CPAs:The CPAs hold meetings at least twice a year, which focus on the financial conditions of the company, the operation ,financial conditions and internal audit of foreign subsidiary ,and fully communicating with the significant adjusting journal entries and the influence of modified regulation.In the case of emergency, a meeting may be convened at any time.
The independent directors and the internal audit managers: the internal auditors hold meetings on a quarterly basis,communicating the result of the audit report and the situation of internal control.In the case of emergency, a meeting may be convened at any time.

The communication between the independent directors and CPAs has been functioning well, and major discussions in the past two years are as below:

Date	Meeting	Communication Matter	Report Highlight	Communication Results and the Company’s Response
March 7, 2023	Communication	2022 Financial Statements	2022 Financial Audit Report, Significant Accounting Standards and Update of tax laws and regulations.	CPAs explained condition of 2022 financial and gains (losses),and conducted discussions and communications focusing on accounting principles and application of tax regulations, and no objections from independent directors.
		Key Audit matters	2022 Key Audit matters in inventory evaluation, business combination, and impairment assessment of goodwill.	Based on CPAs’ professional judgements, Key Audit matters of 2022 financial statements of the Company are approved without objections from independent directors.
		The major concerns of competent authority	Update of stock exchange laws and regulations	Approved after discussion and communication, and no objections from independent directors.
August 3, 2023	Communication	The Financial Statement of first half of 2023	Financial Audit Report, Significant Accounting Standards and Update of tax laws and regulations for first half of 2023.	CPAs explained condition of the first half of 2023 financial and gains (losses), and conducted discussions and communications focusing on accounting principles and application of tax regulations, and no objections from independent directors.
		Annual Audit Plans	Identification of Key Audit matters and major audit procedures.	Acknowledged by independent directors.
		Other notes and important regulatory updates.	Matters of the competent authority and intents of important regulatory updates.	After discussion and communication, no objections from independent directors.

Date	Meeting	Communication Matter	Report Highlight	Communication Results and the Company’s Response
March 8, 2022	Communication	2021 Financial Statements	2020 Financial Audit Report, Significant Accounting Standards and Update of tax laws and regulations.	CPAs explained condition of 2021 financial and gains (losses),and conducted discussions and communications focusing on accounting principles and application of tax regulations, and no objections from independent directors.
		Key Audit matters	2021 Key Audit matters in inventory evaluation, business combination, and impairment assessment of goodwill.	Based on CPAs’ professional judgements, Key Audit matters of 2021 financial statements of the Company are approved without objections from independent directors.
		The major concerns of competent authority	The letter from the cometent authority explains and strengthens the inspection of the company's 2021 financial report to assess the impact of the COVID-19 epidemic on the company's ability to continuous operation, asset impairment and financing risks.	Approved after discussion and communication, and no objections from independent directors.
August 24, 2022	Communication	The Financial Statement of first half of 2022	Financial Audit Report, Significant Accounting Standards and Update of tax laws and regulations for first half of 2022.	CPAs explained condition of the first half of 2022 financial and gains (losses), and conducted discussions and communications focusing on accounting principles and application of tax regulations, and no objections from independent directors.
		Annual Audit Plans	Identification of Key Audit matters and major audit procedures.	Acknowledged by independent directors.
		Other notes and important regulatory updates.	Matters of the competent authority and intents of important regulatory updates.	After discussion and communication, no objections from independent directors.

The communication between the independent directors and the internal auditing officer has been functioning well, and major discussions in the past two years are as below:

Date	Meeting	Discussion	Communication Results and the Company’s Response
March 7, 2023	Audit Committee	2022 Internal Control System Statement and Report on implementation status of self-evaluation.	No objections from independent directors and submitted for report to the Board of Directors after resolution.
March 7, 2023	Audit Committee	Audit implementation report in Q4, 2022, and post-term follow-up audit descriptions.	After discussion and communication, no objections from independent directors against audit implementation report.
May 3, 2023	Audit Committee	Audit implementation report in Q1, 2023.	After discussion and communication, no objections from independent directors against audit implementation report.
August 3, 2023	Audit Committee	Audit implementation report in Q2, 2023.	After discussion and communication, no objections from independent directors against audit implementation report.
November 2, 2023	Audit Committee	2024 Audit Plans (Internal audit managers discussed with independent directors prior to the meeting)	No objections from independent directors and submitted for report to the Board of Directors after resolution.
November 2, 2023	Audit Committee	Audit implementation report in Q3, 2023.	After discussion and communication, no objections from independent directors against audit implementation report.

Date	Meeting	Discussion	Communication Results and the Company’s Response
March 8, 2022	Audit Committee	2021 Internal Control System Statement and Report on implementation status of self-evaluation.	No objections from independent directors and submitted for report to the Board of Directors after resolution.
March 8, 2022	Audit Committee	Audit implementation report in Q4, 2021, and post-term follow-up audit descriptions.	After discussion and communication, no objections from independent directors against audit implementation report.
May 3, 2022	Audit Committee	Audit implementation report in Q1, 2022.	After discussion and communication, no objections from independent directors against audit implementation report.
August 4, 2022	Audit Committee	Audit implementation report in Q2, 2022.	After discussion and communication, no objections from independent directors against audit implementation report.
November 3, 2022	Audit Committee	2023 Audit Plans (Internal audit managers discussed with independent directors prior to the meeting)	No objections from independent directors and submitted for report to the Board of Directors after resolution.
November 3, 2022	Audit Committee	Audit implementation report in Q3, 2022.	After discussion and communication, no objections from independent directors against audit implementation report.