Risk Control & Audit

Sinyi Development has established a risk management policy and methodology to assess regular and ad hoc risks associated with its businesses, operations, activities and systems. It promptly confirms and implements corresponding management measures to control the level of risk, aiming to identify, analyze, and respond to actual and potential impacts. Sinyi Development, through its internal audit system, promptly identifies risks and properly tracks and improves them, avoiding major impacts and damages, thereby identifying, analyzing, and responding to actual and potential impacts.

Risk Management Policy

Sinyi Development possesses robust risk management capabilities to address risks and opportunities arising from both internal and external factors, aligning with global and local trends. Beyond safeguarding the Company’s profitability and continuity, we are fully prepared to confront potential risks and dynamically seize emerging business opportunities. In particular, Sinyi Development identifies and manages climate-related risks and opportunities in accordance with the Task Force on Climate-related Financial Disclosures (TCFD) framework, and discloses information accordingly. Following the updated Risk Management Policy and Procedures of the parent company in July 2023, Sinyi Development adopts a top-down approach wherein the Board of Directors identifies and determines major risk items. Resources are strategically allocated to manage key risks effectively. A systematic methodology, combined with annual planning activities, is employed to ensure comprehensive implementation and effectiveness of risk management practices throughout the organization.

Risk Management Organization

At the operational level, Sinyi Development is governed by the Parent Company (Sinyi Group), the Group-wide Ethics Management Committee, the Sinyi Development Board of Directors, Management, Business Units, and the Audit Office. The roles and responsibilities of each entity are outlined in the following table:

Review the Sinyi Group’s Annual Risk Management Report, Risk Execution Report, and Audit Report.
The deliberative body engages with various functional heads on ESG topics, facilitating interaction and communication throughout the year.
At the end of the year, it reviews the impact of ESG issues, assesses strategic objectives, evaluates performance achievements, and identifies improvement and preventive measures.

Senior executives of Sinyi Development actively participate in major risk decision-making processes and the promotion of related initiatives within the Sinyi Group. Through risk identification, assessment, analysis, management measures, and the development and implementation of risk treatment plans, they ensure effective risk management. Progress and outcomes are regularly reported to the Board of Directors.

The Board of Directors, serving as the Company's highest internal risk management body, reviews the Annual Risk Management Report, Risk Execution Report, and Audit Report to ensure the effective implementation of the risk management system.
Senior management engages with business units through regular and ad-hoc performance meetings to discuss ESG issues, assess impact levels, align on strategies and objectives as directed by the Board, and formulate execution plans to achieve performance targets.

Risk Management Process

Risk Management Policy,

Supervision and Review

Risk Identification

Risk Assessment

Risk Treatment

Establish a Risk Management Environment

Communication and Negotiation

Audit System

Sinyi Development utilizes an internal audit system to promptly identify risks, track them effectively and implement improvements, thereby avoiding significant impacts and damages. This serves as a basis to identify, analyze and respond to actual and potential impacts.

Internal Control System

Sinyi Development follows the internal control requirements established by the Sinyi Group. Each unit designs its operational procedures based on industry characteristics and workflow needs, setting up internal control items that are approved by unit managers. This approach helps manage operational risks and promotes sound corporate governance. In addition, Sinyi Development conducts an annual self-assessment of internal controls to reinforce self-monitoring mechanisms, enabling timely review and correction of any deficiencies to ensure the continued effectiveness of the internal control system. Currently, Sinyi Development has established the following control cycles to manage risks effectively: Sales and Collection Cycle Procurement and Payment Cycle Construction Cycle Payroll Cycle Investment Cycle Financing Cycle Property, Plant, and Equipment Cycle General Management Controls

Internal Audit System

Sinyi Development leverages the internal audit system, operating procedures, and resources of the Sinyi Group to formulate its annual audit plan and implements supervisory and management activities accordingly. If any internal control deficiencies or irregularities are identified during audits, a corrective and preventive mechanism is immediately activated. Improvement measures are developed, and the identified deficiencies and irregularities are incorporated into departmental performance evaluations as key assessment items. Audit personnel are responsible for conducting regular follow-up and management to ensure continuous improvement.