RoboSense Technology Co., Ltd — Governance Information 2012

Mar 30, 2012

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南京熊猫電子股份有限公司

NANJING PANDA ELECTRONICS COMPANY LIMITED

(A joint stock company incorporated in the People’s Republic of China with limited liability) (Stock Code: 0553)

Terms of Reference and Rules of Procedure of the Audit

Committee of the Board of Directors

Note: This Terms of Reference and Rules of Procedures was originally drafted in Chinese, the English translation is for your reference only. In case there is any discrepancy between the Chinese and English version, the Chinese version shall always prevail.

Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

Nanjing Panda Electronics Company Limited

Terms of Reference and Rules of Procedure of the Audit

Committee of the Board of Directors

Chapter I General Provisions

• Article 1 In order to strength the scientific decision making of the Board of Directors of Nanjing Panda Electronics Company Limited (“the Company”) in financial auditing, to achieve advanced auditing and professional auditing and to ensure effective supervision of the Board of Directors on the financial status of the Company, the Board of Directors of the Company shall, in accordance with the Company Law of the People’s Republic of China, Code of Corporate Governance for Listed Companies in China, Articles of Association of the Company and other relevant regulations, set up the Audit Committee and formulate this Rules of Procedure.

• Article 2 The Audit Committee is the specialized organ established by the Board of Directors and mainly responsible for the Company’s financial audit, financial supervision and financial review.

Chapter II Personnel Composition

• Article 3 The Audit Committee shall be composed of three to five non-executive directors and the majority of the members of the Committee shall be independent non-executive directors. At least one independent non-executive director of the Audit Committee shall be an accounting professional.

• Article 4 The members of the Audit Committee shall be nominated by the Chairman of the Board of Directors and the majority of the independent non-executive directors or one-third of all directors, and shall be elected by the Board of Directors.

• Article 5 The Audit Committee shall have one head who shall be the non-executive director and responsible for presiding over the Audit Committee. The head shall be nominated by the Chairman of the Board of Directors among the directors and shall be elected by the Board of Directors.

• Article 6 The members of the Audit Committee shall serve the term of one year. Upon expiration of their terms, their term of office are deemed to be renewed if the Board of Directors has not made any adjustment. The Board of Directors has right to make adjustment in the members of he Committee at any time. In the

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Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

• event that a member of the Committee ceases to be a director of the Company during his term of membership, his membership on the Committee shall lapse immediately. The Board of Directors shall, in accordance with this Rules of Procedure, make up the number of members of the Committee.

• Article 7 The Audit Committee shall have one secretary-general to be responsible for daily liaison and meeting organization etc.

Chapter III Responsibility and Authority

• Article 8 The Audit Committee is mainly responsible for:

• (I) Making recommendations to the Board on the appointment, re-appointment and removal of the external auditor, approving the remuneration and engagement terms for the external auditor, and handling any matters relating to the resignation or dismissal of such auditor; reviewing and monitoring the external auditor’s independence and objectivity as well as the effectiveness of the audit process, and discussing with the auditor over the nature and scope of the audit and reporting obligations before the audit commences;

• (II) Being the main representative between the Company and the external auditors and responsible for supervising the relationship between them and coordinating with the domestic and international auditors;

• (III) Formulating the policies regarding the external auditors offering non-auditing services and conducting the implementation. For this article, “external auditors” include any organizations under the same control, ownership or management right with the company responsible for auditing, or any third party reasonably knowing all the relevant materials that would conclude, under reasonable circumstance that the organization belongs to a part of the local or international business of the company responsible for auditing. The Audit Committee shall report to the Board of Directors on the actions it has taken or improved items and make relevant recommendations;

• (IV) Reviewing the quarterly, interim and annual financial statements before submitting to the Board of Directors, including but not limited to reviewing the following content:

  • (a) Any changes in accounting policies and accounting system;

  • (b) Issues to be judged, accounting estimates and any qualified opinions;

  • (c) Compliance with the accounting principles;

  • (d) Whether the disclosed materials are full and easy to understand;

  • (e) Whether the content in the financial statement is consistent;

  • (f) The processing method regarding non-common items occurred during the reporting period (significant and extraordinary items, including but not limited to asset transactions, contingent liabilities

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Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

and lawsuit) and disclosure;

• (g) Material auditing adjustment;

• (h) Issues concerned by the auditors and unadjusted auditing differences;

• (i) Compliance with the rules of stock exchanges and relevant laws.

－ For the purpose of the above sub-articles (a) to (i):

• (1) The Audit Committee members shall contact with the Board of Directors and senior managers and at least meet with the Company’s auditors twice a year; and

• (2) The Audit Committee shall consider any significant or extraordinary items reflected or to be reflected in such reports and accounts, and shall properly consider the items proposed by the accountants of the Company, financial reporting staff, chief auditor or auditors.

• (V) Discussing the issues proposed after the quarterly, interim and annual financial account review and any doubts arising therefrom, as well as the issues that the auditors hope to be discussed;

• (VI) Reviewing the auditing statement sent by the auditors and the reply of the relevant staff of the Company;

• (VII) In the event that the Company’s employees raises concerns on any improper behaviors that may occur in the financial reporting, internal control or other matters, the Audit Committee shall make proper arrangement and conduct fair and independent investigation on such matters and take proper actions;

• (VIII) Reviewing the Company’s financial control, internal control and risk management system;

• (IX) Discussing the internal control system with the management of the Company to ensure that the management has performed their duties to set up the effective internal control system;

• (X) Studying the investigation results regarding the internal control and the management’s reply to investigation results actively or as appointed by the Board of Directors;

• (XI) Ensuring the work of the internal and external auditors of the Company be coordinated. It is also necessary to make sure that there are sufficient resources for operation and the proper position of the internal auditing functions within the Company, and reviewing and supervising its effects;

• (XII) Reviewing the financial status, accounting polices and practices of the affiliated companies of the Company and its subsidiaries;

• (XIII) Examining the Audit Statement provided by the external auditors to the management of the Company, any material doubts proposed by the auditors regarding accounting records, financial accounts or supervision system and the reply made by the management;

• (XIV) Making sure that the Board of Directors replies to the matters proposed

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Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

in the Audit Statement provided by the external auditors on a timely basis; and

• (XV) Studying other matters as deemed necessary by the Board of Directors.

• Article 9 The Board of Directors may, as it deems necessary, authorize the Audit Committee to deal with the specific matters, and the Audit Committee may, as it deems necessary, require the Board of Directors to authorize them to deal with the specific matters.

• Article 10 The Audit Committee shall report to the Board of Directors. The resolutions made by the Audit Committee shall be submitted to the Board of Directors for approval before implementation. The Audit Committee shall coordinate with the review of the Board of Supervisors.

Chapter IV Decision-making Procedure

• Article 11 The Audit Committee shall have the right to take actions within the scope of their functions and have the right to ask for any materials needed from any subordinated functional departments, subsidiaries, branches and holding companies:

• (1) Relevant financial statements of the Company;

• (2) Work report of the internal and external auditing organizations;

• (3) External auditing contract and relevant working report;

• (4) The information disclosed by the Company;

• (5) Audit report on the significant transactions of the Company;

• (6) Other materials as deemed necessary by the Audit Committee.

• Article 12 The Audit Committee shall assess matters discussed in meetings and submit the relevant written resolution materials to the Board of Directors for discussion:

• (1) Assessment on the performance of the external audit organization, and employment and replacement of external audit organization;

• (2) Whether the Company’s internal audit system has been effectively implemented and whether the Company’s financial statement is true and complete;

• (3) Whether the financial statement disclosed by the Company is true and objective and whether the Company’s significant connected transactions conform to the relevant laws and regulations;

• (4) Assessment on the performance of the financial department and audit department of the Company, including the persons in charge;

• (5) Other related matters.

Chapter V Rules of Procedure

Article 13 The Audit Committee shall meet at least twice a year and notify all the members

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Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

three (3) days before convening the meeting. The meeting shall be presided over by the head. Where the head is unable to attend, he may authorize other members (independent non-executive directors) to preside over.

The auditors employed by the Company may, as it deems necessary, require convening the Audit Committee’s meeting.

• Article 14 The Audit Committee’s meeting may be convened with the attendance of two-thirds or more of the members. Each member of the Committee shall be entitled to one vote and the resolutions adopted in the meeting shall be approved by of the majority of all the members.

• Article 15 In the Audit Committee’s meeting, members may vote by the show of hands or by poll and, in case of ad hoc meetings, the Audit Committee may accept written resolutions in lieu of meeting. The written resolutions may become effective only with the approval of the majority of all the members of the Committee.

• Article 16 The Audit Committee may invite the Company’s directors, internal auditors, administrators, employed auditors or other relevant personnel to attend the meeting. The Company’s Board of Supervisors has the right to appoint the supervisors to participate in the meeting.

The Audit Committee shall at least meet with the auditors once a year without the attendance of the executive directors.

• Article 17 The Audit Committee may listen to the professional opinions of the external legal or other independent experts and, if necessary, invite the outside persons with relevant experience and professional knowledge to attend the meeting. All the expenses incurred thereby shall be borne by the Company.

• Article 18 The convening procedure, method of voting and the resolutions passed in the meetings of the Audit Committee, shall comply with the regulations of the laws, regulations, Articles of Association Company and this Rules of Procedure.

• Article 19 There shall be the minutes of the meetings of the Audit Committee and the members attending the meeting shall sign on the minutes. The meeting minutes shall be kept by the secretary-general of the Audit Committee. The secretary-general of the Audit Committee shall send the draft and final version of the meeting minutes to all the committee members within a reasonable period after the meeting for their comments; but the approval of the head of the Audit Committee is required before circulating such meeting minutes.

Article 20 The resolutions adopted in the Audit Committee’s meeting shall be reported in

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Terms of Reference and Rules of Procedure of the Audit Committee of the Board of Directors of Nanjing Panda Electronics Company Limited

writing to the Board of Directors of the Company.

• Article 21 All the members present at the meetings of the Audit Committee are obliged to keep all the items discussed in the meeting confidential and shall not disclose any relevant information without permission.

Chapter VI Supplementary Provisions

• Article 22 The right of interpretation of the Rules of Procedure shall be vested in the Board of Directors of the Company.

• Article 23 Any matters not mentioned in this Rules of Procedure shall be carried out in accordance with the relevant national laws, administrative regulations, departmental regulations, Articles of Association of the Company and Listing Rules of Shanghai Stock Exchange and Hong Kong Stock Exchange.

Where this Rules of Procedure contravenes the laws, regulations and departmental regulations subsequently promulgated by the state or the amended Articles of Association of the Company or the Listing Rules as amended from time to time, the national relevant laws, administrative regulations, departmental regulations, Articles of Association and Listing Rules shall prevail.

• Article 24 This Rules of Procedure shall become effective as of the date of approval by the Board of Directors.

Board of Directors of Nanjing Panda Electronics Company Limited 17 October, 2002

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