Organization and Configuration
The Internal Audit division of PChome Online Inc. currently employs one full-time auditor to oversee the execution of internal audit.
The Internal Audit of PChome Online Inc. was established in accordance to the law as an independent unit under the Board of Directors. In addition to the typical responsibilities of attendance and reporting at the Board meetings, the Internal Auditor must also report to the Chairman of the Board, the audit committee for the purpose of effectuating the corporate charter.
In accordance to the Guidelines for the Procedure to Establish Internal Control Systems of Publicly Traded Companies promulgated by the Financial Supervisory Commission, the annual audit plan was prepared and implemented following the approval of the Board. Items which shall be audited include transaction cycles of sales and receivables, purchases and payments, payroll, finance, fixed assets, investments, research and development, information system controls, etc. in order to provide a reasonable guarantee of attaining effective and efficient operations (including profit, performance, safeguard of assets, etc.), reliable financial reporting, and compliance with relevant laws and regulations. Moreover, ad hoc audits or reviews shall be performed as needed. The combination of the abovementioned general audits and ad hoc audits provides the management level an additional tool in obtaining the status of operational internal controls and in understanding any existing or potential inadequacies of the internal control system. Following the execution of internal audit to inspect operations in accordance to the audit plan, a written audit report and a tracking report shall be submitted to the audit committee for review.
Internal Audit scrutinizes the self-inspecting operations performed by each individual unit in accordance to the internal control systems, which include checking if the operation has been executed and reviewing documents to ensure the quality of the execution. The results of self-inspection are combined with any inadequacies to internal controls as well as abnormalities discovered by each unit to serve as the basis for a written statement of recommendations of internal control to the Board. With respect to subsidiaries publicly traded or traded over-the-counter, the Company is subject to additional requirements of establishing a full-time Internal Audit staff responsible for audit operations of the subsidiaries. The Company’s Internal Audit department shall supervise the auditing operations of its subsidiaries.