The Operation of Internal Auditing

Internal Auditing Office

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The Internal Auditing Office is established under Board of Directors independently with one chief internal auditor and five auditing staffs, and the chief internal auditor shall report to Board of Directorsdirectly in every meeting. Every auditing staff is regulated to take operational auditing training courses for more than 12 hours each year, which should be reported on MOPS for the Securities and Future Bureau's reference.
According to the Securities and Exchange Act, Article 14-5, the appointment of the auditing office of the Company should be approved in the audit committee and resolved in the board meeting.
According to the Company's Corporate Governance Rules Article 3, the appointment and resignation, evaluation, and compensation of the internal auditor should be proposed by the auditing officer and approved by the chairperson.
The internal audits are planned by risk assessment and executed after Board of Directors approval. Internal auditors shall analyze and report the result to management for further improvement. Moreover, the audit report should be delivered to Supervisors and Independent Directors by next month whenthe report has been made. Internal auditors need to keep reviewing the execution of the audit and work out the report at least once a quarter to make sure every rule has been followed adequately.
The internal audits are scheduled on purpose, including monthly regular audits, unscheduled audits, project audits and self-audit conducted byevery department.