Beijing Tong Ren Tang Healthcare Investment Co., Ltd. (abbreviated as TONGRENTANGCARE) has published the “Terms of Reference of the Audit Committee of the Board,” outlining the committee’s structure, responsibilities and operating procedures in accordance with the PRC Company Law, Hong Kong Listing Rules and the Corporate Governance Code.
The document confirms that TONGRENTANGCARE’s Audit Committee will comprise three non-executive directors, with a majority of independent non-executive directors and an independent chair possessing requisite professional accounting or financial expertise. A former partner of the company’s current external auditor is barred from joining the committee within two years of leaving the audit firm.
Key responsibilities include: • Oversight of financial reporting integrity, with mandatory reviews of interim, annual and (if prepared) quarterly results prior to Board approval. • Annual assessment of the external auditor’s performance, recommendations on (re)appointment, determination of remuneration and engagement terms, and supervision of auditor independence—particularly regarding any non-audit services. • Evaluation of internal controls, risk-management and compliance systems at least once a year, including adequacy of resources, staff qualifications and training in the finance, accounting and internal audit functions. • Direct supervision of the finance centre and audit department, authority to initiate investigations, and power to engage external professionals at the company’s expense. • Establishment of confidential reporting channels for employees and procedures to ensure independent investigation and follow-up on misconduct allegations related to accounting, auditing or internal control. • Authority to propose dismissal of directors or senior management for legal or regulatory breaches, call extraordinary general meetings, and initiate litigation under Article 189 of the PRC Company Law when necessary.
Operational guidelines specify at least two regular meetings per year—aligned with interim and annual results—with additional meetings convenable by the chair, a majority of members, or external/internal auditors. A quorum requires two-thirds attendance, including at least one independent non-executive director. Decisions are passed by simple majority; any member with a conflict of interest must recuse themselves.
Meeting minutes are to be retained for a minimum of ten years, and the committee must report its resolutions and recommendations to the Board in writing. The company will provide sufficient resources for the committee’s work, and reasonable costs of external advisers will be borne by TONGRENTANGCARE.
The Terms of Reference take effect upon Board approval, with provisions related to Hong Kong Listing Rules effective from the date the company’s H shares commence trading on The Stock Exchange of Hong Kong. Any future amendments require Board approval and must align with prevailing laws, regulations and the company’s Articles of Association.
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