Guangdong Tianyu Semiconductor Co., Ltd. (TIANYU SEMI, 02658) has released a revised Terms of Reference for its Board Audit Committee, introducing detailed mandates aimed at reinforcing board-level oversight of financial reporting, risk management and internal control. Key elements are as follows:
• Committee Composition – Minimum of three non-executive directors, with an odd-numbered membership and a majority of independent non-executive directors. – At least one independent member must possess accounting or financial management expertise as required under Hong Kong Listing Rule 3.10(2). – An external auditor’s former partner is barred from committee service for two years after ceasing the partnership or relinquishing any financial interest.
• Core Responsibilities – Recommends appointment, re-appointment or dismissal of external auditors, approves their remuneration and monitors independence. – Reviews annual, half-yearly and (if issued) quarterly financial statements, focusing on accounting policy changes, major estimates, audit adjustments, going-concern assumptions and compliance with IFRS and Hong Kong Listing Rules. – Oversees the company’s risk management and internal control systems, including adequacy of financial resources, staffing and training. – Coordinates internal and external audit activities and ensures adequate resources for the internal audit function. – Establishes whistle-blowing arrangements that allow employees to report concerns confidentially.
• Internal Audit Department – Functions as the committee’s daily working body, reports quarterly, and must issue at least one comprehensive internal audit report annually. – Charged with evaluating internal controls, financial integrity, regulatory compliance and anti-fraud mechanisms across the company and its significant subsidiaries.
• Meeting Protocols – At least one regular meeting per quarter; extraordinary meetings may be convened with consent of at least half the members. – Resolutions require approval by a majority of all committee members, with a quorum of two-thirds. – Minutes are retained for a minimum of ten years.
• Shareholder Protection – Shareholders holding at least 1% of shares for 180 consecutive days may request the committee to initiate litigation against directors or senior managers for breaches causing company losses; if the committee declines or delays, shareholders may sue directly.
• Implementation & Oversight – The updated charter becomes effective upon board approval and will supersede the previous version. – The board retains interpretative authority over the document, which will be revised promptly if conflicts arise with future regulations or articles of association amendments.
The revised charter, dated 19 May 2026, underscores Tianyu Semiconductor’s commitment to enhanced transparency, robust internal controls and strengthened investor safeguards.
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