Organization and Operation of Internal Audit Division

Organization of Internal Audit Division

The Internal Audit Division is directly subsidiary to the Board of Directors, led by the Chief Auditor and staffed with competent persons in an appropriate number as full-time internal auditors who shall perform their duties in a detached and independent manner, after having regard to the company’s investment scale, business condition, management needs, and relevant provisions of acts and regulations.

Operation of Internal Audit Division

The purpose of the internal audit system is to assist the Board of Directors and management to verify and evaluate whether the internal control system operates effectively, and to provide appropriate recommendations for improvement so as to ensure the on-going and effective implementation of the internal control system and serve as the basis of internal control system revisions. Main responsibilities include:

1. Conducting annual audits

Execute the Board-approved annual audit plan. It performs a routine audit at least annually on the company’s finance, operations, information and other management units as well as special audit as deemed necessary, following specific scopes defined by the Regulations Governing the Implementation of Internal Control and Audit System of Insurance Industries and relevant provisions of acts. Internal audit reports are delivered to the Audit Committee and Independent Director for review. The Chief Auditor regularly reports audit business to the Board of Directors and the Audit Committee.

2. Overseeing self-inspections

Oversee the self-inspection of internal control system carried out annually by the operations, finance, information and other units to establish a self-monitoring system. Self-inspection results provided by each unit are reviewed and monitored by the Internal Audit.

3. Monitoring the improvement of deficiency

Conduct continually follow-up reviews on any examination opinions or audit deficiencies brought up by the financial examination authority, CPA, or internal audit (including the internal audit unit of the financial holding company), and on matters specified in the internal control system statement as requiring stronger improvement efforts, and submit a written report on the implementation of improvement of deficiencies to the Board of Directors and the Audit Committee.