Suzhou TZTEK Technology Co., Ltd

2024 Internal Control Evaluation Report

All shareholders of Suzhou TZTEK Technology Co., Ltd.:

In accordance with the provisions of the Basic Standards for Enterprise Internal Control and its supporting guidelines and other internal control regulatory requirements (hereinafter referred to as the "Enterprise Internal Control Specification System"), combined with the Company's (hereinafter referred to as the Company's) internal control system and evaluation methods, and on the basis of daily supervision and special supervision of internal control, we evaluated the effectiveness of the Company's internal control as of December 31, 2024 (the reference date of the internal control evaluation report). I. Important Notices

It is the responsibility of the board of directors of the company to establish, improve and effectively implement internal control, evaluate its effectiveness, and truthfully disclose the internal control evaluation report in accordance with the provisions of the enterprise's internal control system. The Supervisory Board supervises the establishment and implementation of internal controls by the Board of Directors. Managers are responsible for organizing and leading the day-to-day operation of the company's internal controls. The Board of Directors, the Board of Supervisors, the directors, supervisors and senior management of the Company guarantee that there are no false records, misleading statements or material omissions in the content of this report, and assume individual and joint legal liability for the authenticity, accuracy and completeness of the content of the report.

The goal of the company's internal control is to reasonably ensure the legal compliance of operation and management, asset security, true and complete financial reports and related information, improve operational efficiency and effectiveness, and promote the realization of development strategy. Due to the inherent limitations of internal controls, it can only provide reasonable assurance that the above objectives will be achieved. In addition, there is a risk that the effectiveness of future internal controls will be inferred based on the results of internal control evaluations because changes in circumstances may lead to inappropriate internal controls or reduced compliance with control policies and procedures.

Conclusions of the internal control evaluation

1. Whether the company has any material deficiencies in the internal control over financial reporting on the reference date of the internal control evaluation report

□ Yes √ No

2. Conclusion of the evaluation of internal control over financial reporting

√ valid □ invalid

According to the identification of material deficiencies in the Company's internal control over financial reporting, there were no material deficiencies in the internal control over financial reporting as of the reference date of the internal control evaluation report, and the Board of Directors believes that the Company has maintained effective internal control over financial reporting in all material respects in accordance with the requirements of the standard system of internal control of the Company and relevant regulations.

3. Whether material deficiencies in internal control over non-financial reporting were found

□ Yes √ No

According to the identification of material deficiencies in the Company's internal control over non-financial reporting, the Company did not find any material deficiencies in the internal control over non-financial reporting as of the reference date of the internal control evaluation report.

4. Factors influencing the conclusion of the internal control effectiveness evaluation between the benchmark date of the internal control evaluation report and the date of issuance of the internal control evaluation report

□ Applicable √ Not applicable

There were no factors affecting the conclusion of the internal control effectiveness evaluation between the benchmark date of the internal control evaluation report and the date of issuance of the internal control evaluation report.

5. Whether the internal control audit opinion is consistent with the company's evaluation conclusion on the effectiveness of internal control over financial reporting

√ Yes □ No

6. Whether the disclosure of material deficiencies in the internal control audit report of non-financial reporting is consistent with the disclosure in the company's internal control evaluation report√ and whether it is □ or no

Evaluation of internal control

(1) Scope of internal control evaluation

In accordance with the risk-oriented principle, the company determines the main units, businesses and matters included in the evaluation scope, as well as high-risk areas.

1. The main units included in the evaluation scope include: Suzhou TZTEK Technology Co., Ltd. and all its holding companies.

2. Proportion of units included in the scope of evaluation:

Indicator Proportion (%)

The ratio of the total assets of the units included in the evaluation scope to the total assets of the company's consolidated financial statements is 100

The ratio of the total operating income of the units included in the evaluation scope to the total operating income of the company's consolidated financial statements is 100

3. The main operations and matters to be included in the scope of the evaluation include:

Development strategy, corporate governance structure, organizational structure, human resources, employee performance and incentives, technology platform construction, management platform construction, related party transactions, external guarantees, use of raised funds, information disclosure, social responsibility, corporate culture, capital activities, budget management, procurement business, asset management, inventory management, sales business, research and development, financial reporting, contract management, file management, intellectual property risk, qualification management, information confidentiality, legal risk, infrastructure management, etc.

4. High-risk areas to focus on include:

Employee Performance & Motivation, Procurement Business, Sales & Collection, Inventory Management, Intellectual Property Risk, Information Confidentiality, Contract Management, etc. 5. Whether the above-mentioned units, businesses and matters included in the scope of evaluation, as well as high-risk areas, cover the main aspects of the company's operation and management, and whether they exist

in major omissions

□ Yes √ No

6. Whether there is a statutory exemption

□ Yes √ No

7. Other Notes

not

(2) The basis for internal control evaluation and the criteria for identifying internal control deficiencies

The company organizes and carries out internal control evaluation in accordance with the enterprise internal control standard system and other internal control supervision requirements.

1. Whether the specific criteria for identifying internal control deficiencies have been adjusted from previous years

□ Yes √ No

The Board of Directors of the Company distinguishes between internal control over financial reporting and non-financial reporting internal control in accordance with the requirements for the identification of material, important and general deficiencies in the internal control system of the enterprise, combined with factors such as the company's size, industry characteristics, risk appetite and risk tolerance, and researches and determines the specific identification standards for internal control deficiencies applicable to the Company, which are consistent with those of previous years.

2. Criteria for identifying deficiencies in internal control over financial reporting

The quantitative criteria for the evaluation of internal control deficiencies in financial reporting determined by the Company are as follows:

Indicator Name Quantitative Standard for Major Defects Quantitative Standard for Important Defects Quantitative Standard for General Defects

Operating Income Potential Misstatement Amount ≥ Operating Income 0.5% of Operating Income ≤ Potential Misstatement Amount Potential Misstatement < Operating Income

1% of the quoted amount < 0.5% of 1% of operating income

Total Assets Potential Misstatement Amount ≥ Total Assets 0.5% of Total Assets ≤ Potential Misstatement Amount Potential Misstatement < Total Assets

1% of the quoted amount < 0.5% of 1% of total assets

Net Profit Amount of Potential Misstatement ≥ 3% of Net Profit ≤ Amount of Potential Misstatement Amount of Potential Misstatement < Net Profit

5% < 5% of net profit 3%

The qualitative criteria for the evaluation of internal control deficiencies in financial reporting determined by the Company are as follows:

Nature of the defect Qualitative criteria

1) The internal control environment is ineffective;

2) It is found that the management has committed or is suspected of fraud;

Material deficiencies 3) material misstatement or omission that directly leads to financial reporting;

4) The certified public accountant found that there was a material misstatement in the current financial report, and the internal control was not issued in the course of operation

The misstatement is now due;

5) The company's financial statements have been or are likely to be issued by a certified public accountant with a negative opinion or a refusal to express an opinion.

1) Failure to select and apply accounting policies in accordance with GAAP;

Material Deficiencies 2) indirectly resulting in material misstatement or omission of financial statements;

3) Other deficiencies that may affect the correct judgment of the financial statements or the users of the statements.

General defects refer to control deficiencies other than major defects and important defects.

Illustrate:

not

3. Criteria for identifying deficiencies in internal control over non-financial reporting

The quantitative criteria for the evaluation of internal control deficiencies in non-financial reporting determined by the Company are as follows:

Indicator Name Quantitative Standard for Major Defects Quantitative Standard for Important Defects Quantitative Standard for General Defects

Direct property loss ≥ total assets 0.3% of total assets≤ direct property losses < total assets

0.5% of direct property loss Property loss < 0.3% of total assets

0.5%

The qualitative criteria for the evaluation of internal control deficiencies in non-financial reporting determined by the Company are as follows:

Nature of the defect Qualitative criteria

(1) Violating relevant national laws and regulations;

(2) The company's decision-making procedures are seriously unreasonable, or there are major mistakes in decision-making;

Major defects (3) The company has major environmental pollution or other events that seriously affect the public interest;

(4) Lack of important business management system or systematic failure of system operation, and continuous operation is challenged and lacking

There is no effective compensation mechanism.

(1) Lack of important systems or process guidelines;

Material deficiencies (2) material deficiencies in internal control have not been rectified;

(3) The company's decision-making procedures are unreasonable, which has a moderate impact on the company's operation.

General defects Control deficiencies other than the above-mentioned major defects and important defects.

Illustrate:

not

(3) Identification and rectification of internal control deficiencies

1. Identification and rectification of deficiencies in internal control over financial reporting

1.1. Material Defects

Whether the company had any material deficiencies in internal control over financial reporting during the reporting period

□ Yes √ No

1.2. Important Defects

Whether the company had any significant deficiencies in internal control over financial reporting during the reporting period

□ Yes √ No

1.3. General Defects

During the reporting period, the Company has rectified the general deficiencies found in a timely manner, which do not affect the realization of the Company's internal control objectives over financial reporting.

1.4. After the above-mentioned rectification, on the base date of the internal control evaluation report, whether the company has any material internal control over financial reporting that has not completed the rectification

flaw

□ Yes √ No

1.5. After the above-mentioned rectification, it is important that the Company has no internal control over financial reporting that has not been rectified as of the reference date of the internal control evaluation report

flaw

□ Yes √ No

2. Identification and rectification of internal control deficiencies in non-financial reporting

2.1. Material Defects

Whether the company found any material deficiencies in internal control over non-financial reporting during the reporting period

□ Yes √ No

2.2. Material Defects

Whether the Company found any material deficiencies in internal control over non-financial reporting during the reporting period

□ Yes √ No

2.3. General Defects

During the reporting period, the Company has rectified the general deficiencies found in a timely manner, which do not affect the realization of the Company's internal control objectives over financial reporting.

2.4. After the above-mentioned rectification, on the base date of the internal control evaluation report, whether the company found that the internal control over non-financial reporting that had not completed the rectification was heavy

Big flaws

□ Yes √ No

2.5. After the above-mentioned rectification, on the reference date of the internal control evaluation report, whether the company found that the internal control over non-financial reporting that had not completed the rectification was heavy

To be defective

□ Yes √ No

4. Explanation of other major matters related to internal control

1. Rectification of internal control deficiencies in the previous year

□ Applicable √ Not applicable

2. The operation of internal control in the current year and the direction of improvement in the next year

√ Applicable □ Not applicable

In 2024, the Company's internal controls were effectively implemented, and no material or significant deficiencies were found in the financial and non-financial reports.

In 2025, the company will continue to deepen the construction of the internal control system, optimize the internal control environment, and improve the internal control systems and regulations

Implement the internal control system, strengthen the supervision and inspection of internal control, improve the level of internal control management, effectively prevent various risks, and promote the healthy and sustainable development of the company.

3. Explanation of other major matters

□ Applicable √ Not applicable

Chairman (authorized by the board of directors): Xu Yihua

Suzhou TZTEK Technology Co., Ltd

April 11, 2025