MACHINERY & ELECTRIC CO. LTD.
CQME Held the Internal Control Operation Communication Meeting
CQME Held the Internal Control Operation Communication Meeting
Strengthen Internal Control Operation, Optimize Corporate Governance, Accelerate Transformation and Upgrading CQME Held the Internal Control Operation Communication Meeting
Chongqing Machinery & Electric Co., Ltd. held the Internal Control Operation Communication Meeting at Chongqing Cummins Engine Co., Ltd. on 28 November 2013. It planned to improve the standard and quality of the subsidiaries’ internal control system, and then achieve the improvement of corporate governance and transformation through the communication among subsidiaries. Mr. Wu Debin, the chief of Enterprise Administration Department One of Chongqing State-owned Assets Supervision and Administration Commission, Mr. Yu Gang, the executive director and general manager of CQME, Mr. Xiang Hu, the vice general manager of CQME, together with relevant leaders and staff of 15 subsidiaries attended the meeting. Mr. Xiang Hu, vice general manager of CQME, presided over the meeting.
The subsidiary representatives, Chongqing Cummins Engine Co., Ltd., Chongqing Pigeon Electric Wire and Cable Co., Ltd., Chongqing Gas Compressor Factory Co., Ltd., Chongqing Pump Industry Co., Ltd., and Qijiang Gear Transmission Co., Ltd. introduced their experience of internal control operation respectively on the meeting.
Zhou Yingnian, CFO of Chongqing Cummins, and Li Manling, chief of Audit Department gave a speech entitled “internal control and financial performance” and “internal control into management” respectively. They introduced the methods and experience which Chongqing Cummins adopted to implement the internal control, also pointed out that internal control and business management are one, and the optimization of enterprise's financial results should be achieved by means of strict internal control. In addition, Chongqing Cummins has now established the internal control processes in the aspect of procurement, sales, maintenance, inventory, R&D, engineering supervision, fixed assets management, IT, compensation, general ledger. Mr. Android, general manager of Chongqing Cummins pointed out that "integrity, honesty, Transparency and openness" are characteristics a company should own, while internal control can ensure them. Xia Hua, chairman of Chongqing Pigeon, said, the management mode had changed into modern management mechanism combined with process control, delicacy management and performance assessment after the establishment of internal control, the awareness of risk control enhanced obviously, system execution increased substantially, and key indicators of economic operation, such as revenue, profit, inventory, gross margin improved further. Wang Xuezhi, chairman of Chongqing Gas Compressor pointed out that Chongqing Gas Compressor attached importance to inspection, improvement, communication during the implementation of the internal control, so that corporate system may perfected, management process may standardized further, product quality and price control ability may promoted. Wang Gang, deputy party secretary of Chongqing Pump Industry, said that Chongqing Pump Industry realized that the establishment of internal control system is the need for modern enterprise to survive and develop. Chongqing Pump Industry combined the internal control system with the informatization platform, brought the implementation results of internal control into the cadre performance assessment, linked the internal control execution with integrity risk prevention, and the internal control operation has achieved good result. 90.8% of processes tested were effectively performed. Yu Xiangqin, vice general manager of Qijiang Gear Transmission, said, Qijiang Gear Transmission insisted to put the effective implementation of internal control system in the first place, strengthen the inspection, strictly enforce accountability system. The overall operation was in good condition, corporate management effectively improved, the business risk reduced, and consciousness of enterprise system, evidence, improvement and risk enhanced further as result.
Wu Debin, the chief of Enterprise Administration Department One of Chongqing SASAC, affirmed the achievements made by CQME in terms of internal control. He pointed out the Third Plenary Session of 18th Central Committee asked the state owned enterprises to stimulate vigor, strengthen competitiveness through scientific management. The internal control is helpful for transferring theory of business, changing extensive management into precision management, optimizing supervision, and innovating the management mode. Mr. Wu advised: firstly, to consolidate the achievements, and attach importance to perseverance; secondly, to enhance the power of execution, and pay attention to determination; thirdly, to improve and perfect continuously, and attach importance to innovation; fourthly, to deepen management and administration, and emphasize practical results. He expect CQME to pay adequate attention to the market, research and development, structural adjustment, and efficiency through strong internal control.
Mr. Yu Gang, executive director and general manager pointed out that, as a listed company, CQME must establish standard, thorough risk-control system, which not only met the needs of the relevant regulations, but also the need to improve management capacity and core competitiveness. CQME should further improve the internal control system, also carry out comprehensive budget management, risk management and market value management. He said, Chongqing Cummins started the internal control construction early in 2005, and still kept improving. The internal control brought Chongqing Cummins the good management effect and economic benefits, which is worth to learn.
At last, Mr. Yu put forward several requirements on the next work of internal control of CQME: Firstly, all the subsidiaries should summarize the experience of internal control for nearly three years, and then perfect the internal control system, enhance the power of execution, and put the dynamic risk control into practice. Secondly, the Risk Control Dept. of CQME should reinforce the inspection and assistance to the subsidiaries, and the Audit Dept. of CQME should organize the effectiveness assessment of the internal control of subsidiaries. Thirdly, all the subsidiaries should attach great importance to the rectification of the defects in the internal control, and propose corrective measures and schedule target on the unfinished rectification. The risk on receivables and inventory should be pay high attention to control. Fourthly, 2014 is the year of promoting the management of CQME, and consolidating the foundation of risk control is particular significant for management promotion, so all the subsidiaries must make risk assessment in advance, as well as make risk control measures in advance. Fifthly, on the basis of the requirements of “formalism, bureaucratism, hedonism, extravagance” rectification movement, all the subsidiaries should carry out the work, further improve the management, optimize the system, keep away from risk, and improve efficiency, combined with their practical situation of enterprise operation and management.
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