The 21^st meeting of the first term Board of Audit Committee was held on April 26^th, 2016 at Fulian Building, Quanzhou. The committee chairman – Mr. Warren Wilder, committee members – Mr. Xu Jianping, Mr. Scott Sullivan and FREP supervisor – Mr. Yang Hongbin attended the meeting. Mr. Chen Xiaobo, the committee member didn’t attend the meeting and appointed Mr. Xu Jianping to act on his behalf.

Ms. Liu Cuixia, the chief auditor reported the main accomplishments since the last BAC meeting, summarized and reviewed the 2015 internal audit work; Mr. Joe M Francis, General Manager of Finance Department, presented the follow-up items of the last BAC meeting, control gaps closure status, 2016 business control plan update, the year-end representative letter and control training and 2016 self-assessment summary; External Auditing Organization, KPMG reported the audited 2015 financial statement and audit focus for year 2016.

BAC recognized and appreciated the work performed by IA, and commented that IA did an excellent job in assisting the management to identify control weaknesses, optimize work processes and improve management, and the service quality and professional ability of IA were improved steadily. The BAC required IA to continuously focus on high-risk issues.

BAC members recognized the efforts made by the company’s management in closing control gaps. It is also required at the meeting that FREP management shall develop job rotation and development plan for sensitive positions including internal auditors, to timely assess employee’s daily work performance with incentives.

Supervisor Mr. Yang Hongbin suggested that FREP shall invite an independent third party to investigate potential irregularities, analyze causes and recommend effective rectification measures.

The 2015 auditors’ report issued by KPMG was reviewed at the meeting. BAC agreed and endorsed to submit the report to BOD for approval. BAC members reached a consensus that the next BAC meeting shall be held together with the next BOD meeting.(Xu Juan)