In order to achieve transformation and upgrading, to make progress in stability and create the situation of sustainable development, we shall focus on “management priority” and aim at the main point of internal control to comprehensively improve the ability of refined management based on information construction.

Management is the eternal theme of an enterprise. During the period of transformation and upgrading, management is particularly important. In the new year, we must “put pressure on personnel to make improvement” and increase the weight of management. First, we must lay a solid foundation for management. We shall explore and improve the two-level management system of the Group and engineering bureau (subsidiary and project department) as well as hierarchical management method to strengthen the standardized management method and put the management focus into the next level. With differentiated management methods, we will strengthen management to ensure the target management of the sub-diary unit and company. It is necessary to focus on the management of project field, and make the information management in the construction site more specified, standardized and refined. We will strengthen the management and development of human resources; focus on strengthening project team building, and establishing effective performance management and evaluation mechanism, in an attempt to stimulate everyone’s enthusiasm for work by researching on performance appraisal methods. The purpose is to let the laborious worker get more. It is necessary to strengthen the implementation of information construction to make our work based on information. This year, we will establish and improve the information management platform. At this platform, we will import its in-depth application on the construction field and projects and establish database center to improve the level of data statistics, analysis and control. Everything can be reflected in the data. It is necessary to earnestly strengthen the system of the Group’s leadership to serve the basic units by solving their problems and providing suggestions for improving the efficiency of management. Second, we must strengthen financial management and control. We shall establish a financial-centered cost management system to ensure that the statements can reflect real business condition. We shall refine the allocation method of related expenses and effectively link the project budget with financial accounting. We shall improve the control objectives and assessment rules about the operating expenses, management fees and project department expenses, which shall be decomposed into departments, engineering bureaus, and subsidiaries, and shall be quantified into specific projects, and the responsibility shall be bore by the person in charge. New regulations shall be issued to strictly control the expenses such as entertainment fees and car fares. All departments shall encourage all the staff to be diligent and thrifty to increase revenue and reduce expenditure. We shall response to the tax reform for reducing the tax burden of enterprise. Third, we shall strengthen risk management and control. We shall get a good grasp of national laws and policies as well as industry regulations to control various risks of the project from the source. Furthermore, we shall implement the intervention system of law works in the whole process of contract fulfillment and implement the early warning mechanism to eliminate illegal activities of enterprises and individuals and build a legal and positive private enterprise. We shall strictly undertake the selection and evaluation system prevent from taking over the project with low price, large risk and small scale. It is necessary to implement the system of project target management liability form, start the accountability mechanism and strengthen process management to ensure that the project management system operates normally. We shall put hands together to seek for opinions about how to make the Group better.

(Office of the Chairman)