Internal Audit

Daxin's Internal Audit Office reports directly to the Board of Directors. In accordance with the Company's scale, business operations, management needs, and relevant regulations, qualified and adequate internal auditors are assigned. In addition to presenting reports at regular Board meetings, the Chief Internal Auditor reports to the Chairman of the Board and the Audit Committee on a monthly basis or as necessary.

In compliance with applicable laws and regulations, Daxin has established an internal control system. Under this system, the Internal Audit Office has formulated the Internal Audit Implementation Rules to execute audits and evaluate the effectiveness and compliance of current control systems and procedures, covering all corporate operations and subsidiaries.

Audit activities are primarily conducted based on the risk-based annual audit plan approved by the Board of Directors, supplemented by special audits or reviews as required. The audit results provide management with feedback on the operation of internal controls, assisting them in identifying internal control deficiencies or potential risks while continuously tracking remediation progress.

The Internal Audit Office reviews the internal control self-assessments conducted by all departments and subsidiaries, examining execution status and supporting documentation to ensure assessment quality. Furthermore, it consolidates self-assessment and audit results to report to the President and the Board of Directors, serving as the basis for evaluating the overall effectiveness of the internal control system and issuing the Statement on Internal Control.

In accordance with the Company's "Corporate Governance Best-Practice Principles," the appointment, dismissal, performance evaluation, and compensation of internal auditors are submitted by the Chief Internal Auditor to the Chairman of the Board for approval through the formal sign-off process, with performance evaluations conducted at least once a year. Relevant regulations are disclosed on the Company's website.