Internal Control
Internal Control System

According to Regulations Governing Establishment of Internal Control Systems by Public Companies, NTC has considered the operation of the company and its subsidiaries, complied with the industry law and regulations, and established an effective internal control system. The system is reviewed from time to time in order to adapt to any internal or external environmental changes and ensure the continual effectiveness of the design and operation of the system.

The implementation of the internal control system is a continuous operation. Through constant examination of the operation and management, problems such as operation deviating from the company’s policy, operating procedures, the stated objectives or expected standards are detected, and will be reported to the corresponding management level via the feedback system. The proper measures are taken to tackle the problems in order to ensure that the operation of the company is performed as planned. Also, internal balances and checks are kept to prevent errors and frauds from happening.

 
Internal Auditing

NTC has established the internal auditing unit under the Board of Directors, and appointed qualified full-time internal auditors. The internal auditors are required to attend internal audit training held by professional institutions annually to improve their competence constantly.
The internal audit scope includes:

  • Review the reliability and integrity of financial and operational information.
  • Review the current systems to ensure its compliance with policies, plans, procedures, contracts and laws.
  • Review the means to protect the assets.
  • Assess the efficiency and effectiveness of the use of resources.
  • Review the operation or project programs to evaluate the consistency between the stated objectives and the result.
 

Apart from filing the report on the deficiency of internal control or abnormal facts observed, internal auditors shall file the case and keep track of it to ensure the proper improvement has been made by the corresponding unit. Also, the auditing report should be delivered to each independent board member by the end of the following month after the completion of the report.

Not only does the independent auditing department have the responsibility for internal auditing, but each department should also conduct self-assessments for particular auditing items in the prescribed cycle. Based on the results of the self-assessments of each department, the independent audit department checks each department regularly or irregularly to ensure the effectiveness of the internal control system within each department.

 
Anti-Corruption

All employees of NTC must follow the company’s Personnel Management Regulations. If anyone is proved to engage in corruption, divert public funds, or accept any bribes or commissions, the violator will be dismissed from the position with no excuse, and the supervisor of the violator will receive corresponding punishment depending on the circumstances. To prevent any violations or abuses, the regular rotation of the staff who serves as operating, procurement, logistics, construction supervision and budget planning is carried out. Also, the anti-corruption materials are edited and promoted among all employees. NTC hopes that every employee follows the Code of Ethics whether at work or in their life in order to live up to Formosa Plastics Group’s enterprise culture, “Diligence, Perseverance, Frugality and Trustworthiness’’. There was no case of corruption in 2016.

 
Code of Conduct

In order to follow the international standard and connect with global community, all employees are demanded to full compliance with the standard of Electronic Industry Code of Conduct, following strictly the law and business integrity, to ensure the behavior of NTC and its employees under this standard. Employees are strictly forbidden to do any behaviors that could damage the company, such as bribery, insider stock trading, etc. To achieve this goal, all new employees are trained with Personnel, Disciplines and Penalty Rule according to NTC Employee Handbook. In case of the disciplinary to be judged and verified as a serious fact, the employee will be dismissed immediately according to NTC discipline policy. If so and causes the Company lose, NTC would purse for indemnification by law. The goals of EICC in 2015 included working hours, ethics training, and zero corruptions which were achieved successfully. For the goal of zero sexual harassment, it’s a pity there was 1 case being investigated, disposed, and closed completely. Despite this case, NTC will continue to create equal working environment to both male and female employees. NTC strictly forbids the sexual harassment which is not only to NTC colleague inside company, but also to NTC suppliers. In 2015, the Code of Conduct complied with law. The EICC training and communication activities are completed expectedly. In a summary, the potential risk of EICC violation is really low at NTC.

 
Grievance Channels

NTC has established standardized Employees Reporting Procedures for employees to file complaints and report any illegal or immoral behaviors. For example, when an employee notices any illegal behaviors which could damage the rights or benefits of any individuals or company, or when one finds an employee attempts to take advantage of his/her position to pursue unjust enrichment, he/she can file the complaint form anytime. It will then be reported to the reported personnel’s supervisor. In addition, NTC has enacted the Reporting Procedure in 2016, launched the reporting hotline (02-29061001) and e-mail (audit@ntc.com.tw) on the company’s official website, and assigned designated person in charge of the related affairs for interest parties to file a complaint if anyone’s interests is violated.

 
Reported Cases
Means of reporting 2015 2016
Letters 0 3
Complaint forms 1 1
Hotlines and e-mail 0 0
Total 1 4
Established cases after investigation 1 1
Concluded cases 1 1

The established case in 2016 resulted from the operational defect by personnel rather than corruption.