(2016 Xinghang Machinery) Quality Credit Report

Preface

1. Report preparation standards

Fujian Xinghang Machinery Casting Co., Ltd. reviewed the concepts, systems, measures and achievements of Xinghang in terms of quality management, product quality responsibility, quality integrity management, etc. The contents of this report are explained as follows:

1. Report Scope

The scope of the report: Fujian Xinghang Machinery Casting Co., Ltd.

Reporting period: January 2016 to December 2016

Report release cycle: This report is an annual report

1.1 Statement on the Objectivity of the Report Content

This report is written entirely based on the actual production and operation situation of the company. The content is objective and fair, and there is absolutely no false information. We are willing to be responsible for the authenticity of the content of this report.

1.2 Report Data Description

All contents of this report are based on the company's actual situation or data.

2. Speech by General Manager

Fujian Xinghang Machinery Casting Co., Ltd. is one of the most influential enterprises in the foundry industry. Over the years, with the great help of governments at all levels and relevant departments, and through the hard work of all colleagues in the company, we have fully utilized our own advantages and grown and developed together with other domestic foundry brand enterprises. We have always adhered to the business philosophy of "honesty and trustworthiness, legal operation, strict quality management, strengthening corporate self-discipline, actively fulfilling social responsibilities, and consciously accepting social supervision". At the same time, we insist on independent innovation, actively explore the core technology, research and development, standard setting, etc. of the enterprise, respect science, and have embarked on our own development path.

Xinghang's development is inseparable from the care and help from all walks of life and the support of upstream and downstream peers. Therefore, we are willing to work together with colleagues in the industry, improve together, and make this cake better and bigger together. To realize the beautiful Chinese dream, we should make due contributions to our company.

3. Company Profile

Fujian Xinghang Machinery Casting Co., Ltd. is located in Changle Binhai Industrial Zone, Fuzhou City, Fujian Province. It was founded in 1993 and is a modern private enterprise specializing in casting production and mechanical processing. It was the first batch of foundry industry access certification by the Ministry of Industry and Information Technology. The company is a member of the China Foundry Association, a leading enterprise in China's foundry industry, a high-tech enterprise and a technology-based enterprise in Fujian Province. It has been awarded the honorary titles of "Expert Workstation", "Municipal Enterprise Technology Center" and "Intellectual Property Demonstration Enterprise" by the Fuzhou Municipal People's Government. The company has passed ISO9001 quality management, ISO14001 environmental management, OHSAS18001 occupational health and safety management system certification.

The company specializes in the production of large castings with a unit weight of up to 100 tons, with an annual production capacity of 50,000 tons of castings and 30,000 tons of machining. It covers high-end mold industry, bridge components, metallurgical equipment, construction machinery, wind power, hydropower, nuclear power, marine engineering and other national key projects high-end equipment manufacturing.

The company has accelerated the transformation and upgrading from "ordinary manufacturing" to "intelligent manufacturing", promoted green casting and scientific and technological innovation, and established long-term strategic cooperative relations with the Institute of Metal Research, Chinese Academy of Sciences, Fuzhou University, Fujian University of Technology, etc. by increasing independent innovation and research and development and taking the "production, education, research and application" development path. Many scientific research results projects have been implemented and achieved good results. The company owns more than 20 patents with independent intellectual property rights.

The company has strengthened the integration of information technology and industrialization, and promoted the organic integration of traditional industries with information technology and intelligentization. At the same time, it has played the role of the Internet, used computer simulation technology in the research and development of design products, promoted the visual casting process, and adopted the information technology of "smart workshop execution system" to achieve refined control of the process. In 2015, it was selected as a "pilot enterprise for the implementation of the management system of the integration of information technology and industrialization" by the Ministry of Industry and Information Technology of the People's Republic of China.

The company adheres to the strategic policy of "user orientation, quality improvement, data traceability, process standardization, technical support, and win-win value", gives full play to the advantages of the company's professional technology, professional management and advanced process equipment, and provides customers with high-quality products with the craftsman spirit of "keep improving and serve with heart".

In the fierce market competition, Xinghang is willing to go forward hand in hand with you, bear the wind and rain together, and create brilliance together!

Quality Credit Report

1. Corporate quality philosophy

Xinghang strictly adheres to the quality policy of "trust-based, quality-oriented" in quality management, follows the quality system requirements, and strictly examines every link from raw materials to finished products to ensure that the material quality, production process, and product quality meet the quality standards. The company strictly produces according to process requirements, and each batch of products can be traced back to every link of the production process. After the product is delivered to the customer, regular and irregular return visits are used to collect and organize customer feedback on product quality information, and control it in the subsequent production process to improve product quality.

2 Internal Quality Management

2.1 Quality Management Organization

The company's quality management implements a six-level management system consisting of general manager, deputy general manager in charge, business management department, workshops, and work groups.

⑴General Manager

① Responsible for the establishment and operation of the company's quality management system, implement national laws, regulations, guidelines and policies, and be responsible for the entire company; be fully responsible for production and operation and other work, and be responsible for the quality of the company's products.

② Be responsible for formulating the company's long-term development plan and annual production and operation plan, organizing the preparation and application of the company's various rules and regulations; be responsible for the establishment and maintenance of the quality system.

③ Responsible for the establishment, adjustment and allocation of responsibilities and powers of the company's organizational structure, reviewing the reward and punishment plan for the company's employees, and allocating sufficient resources according to the company's development needs.

④ Responsible for organizing the analysis and processing of major quality issues and the management review of the quality system.

⑵Deputy General Manager in charge of production

Responsible for directing and coordinating the company's overall quality management work and allocating resources as needed.

⑶Business Management Department

①Supervise, inspect, organize and coordinate quality management work.

② Carry out random inspection on finished products before leaving the factory.

③ Manage intangible assets such as trademarks, and order and distribute the number of trademarks and labels to be used as planned.

④Internal and external transmission of quality information.

⑤ Carry out mass quality management activities; carry out quality publicity and education activities, strengthen employees' quality awareness, and establish a sound quality assurance system.

⑥ Hold quality work meetings regularly to analyze and study quality issues that arise within the enterprise or in the operation of the quality system, and propose corrective and preventive measures.

⑦ Responsible for the company's quality and metrology management, manage the laboratory's testing and experimental equipment, and identify the equipment for "mandatory inspection" and "regular inspection" according to regulations.

⑧ Establish quality management system.

2.2 Quality Management System

The company introduced the ISO9001 standard to improve the systematicness, coordination and effectiveness of the management system.

1. Quality policy: meticulous workmanship, pursuit of excellence, cultivation of famous brands, customer satisfaction

2. Quality objectives: Product internal control compliance rate>96%; Main equipment integrity rate>96%; Sampling product

3. Quality education. Carry out systematic and regular quality training and education to continuously improve the quality management ability and operational skills of employees. According to the quality safety and strategic development goals, the company prepares employee training plans, formulates and implements the "Employee Training Management System", and lists the education funds within 2.5% of the total salary of employees to provide financial support for employee education and training. The company's deputy general manager is directly in charge of training work, and arranges employee training work and production and operation work at the same time. Carry out systematic and planned training for employees, and make sure there are medium- and long-term training plans, annual plans, and monthly arrangements. Strengthen employee training according to different levels, categories and contents, and continuously improve employees' quality management ability and operational skills. Improve the talent training and selection mechanism, formulate the "Tutor System Trial Measures", revise the "Agreement Wage Trial Measures", grant corresponding treatment to professional talents at all levels according to grades and needs, and give one-time rewards and lifelong allowances to professional and technical talents with outstanding contributions. Adhere to the organic combination of continuing education, job training, skill improvement, academic education, and job promotion and appointment systems to encourage employees to study consciously and continuously improve their own quality.

4. Quality regulations. The company has formulated the "Laws, Regulations and Other Requirements Acquisition and Update Control Procedure" to clearly define the relevant responsibilities and work procedures to ensure that laws, regulations and other requirements in terms of quality, environment, occupational health and safety can be identified and evaluated. The Quality Supervision Department is responsible for regularly collecting laws, regulations and technical standards related to product quality, organizing the identification and evaluation of changes in quality and safety, and promptly transmitting and implementing relevant change requirements.

5. Quality liability compensation. Formulate the "Product Return Management Measures" to clarify the product return and recall management organization, responsibilities and processing procedures, which will be used to manage the return or recall of the company's products due to quality, packaging, market and other reasons, and bear the quality damage compensation liability according to law.

3. Corporate quality integrity

Integrity is the foundation of business operations. The company adheres to honest operations in accordance with the law, pays attention to the construction of an integrity system, and operates in a standardized manner to ensure that the company's quality assurance, measurement and testing, and standardization systems are sound and effectively operate, and to establish a good reputation for quality.

3.1 Quality Integrity Management

The company strictly implements the provisions of the "Product Quality Law of the People's Republic of China" and other relevant laws and regulations, consciously accepts supervision from consumers, society and administrative departments, and assumes the primary responsibility for product quality.

Establish and improve the enterprise quality system, strengthen quality management, establish a product quality traceability system and after-sales service system, and actively adopt advanced quality management methods. Strictly follow the process operation specifications, strictly control the quality of the production process, strictly control the quality of raw materials, strictly inspect the quality of products before leaving the factory, and organize production in accordance with laws, regulations and standards.

Firmly establish the concept of quality law, strictly implement job quality standards and assessments, and implement a one-vote veto on quality and safety; strictly control quality to ensure that the products produced meet quality and safety standards and explicit quality guarantees, do not adulterate or pass off inferior products as good ones, do not pass off unqualified products as qualified ones, and do not manufacture and sell counterfeit products.

3.2 Quality Culture Construction

Quality culture is an important part of corporate culture. Having a good corporate culture is the foundation for developing and promoting the construction of quality culture. Culture is a kind of identity, a concept, a perception. It is a "historical product" produced through long-term effective development and innovation. It is just a slogan, a few mottos or a booklet. It is a cultural atmosphere that people in the company have gradually strived for after long-term cognition and understanding. Advanced quality culture is an important support and guarantee for producing high-quality brand-name products and shaping corporate brands. It is the main entry point and focus for building a corporate culture with distinctive corporate characteristics. It is an important task of enterprise construction to explore how corporate culture can penetrate into the field of quality work, improve the level of quality management, and promote the upgrading of corporate management to cultural management.

Quality culture is the sum of all values and behavioral norms that are committed to the construction of enterprise quality performance, with quality as the center and the goal of improving the economic benefits of the enterprise. To promote the construction of enterprise quality culture, it is necessary to first establish, implement, maintain and improve the quality management system. Quality culture is diversified and reflected in many aspects. To do a good job in quality culture construction, the company focuses on the following aspects:

⑴Increase publicity efforts and vigorously develop quality culture construction

The company takes "quality first, honesty first" as the theme, actively carries out publicity work on quality culture construction activities throughout the company, and makes full use of meetings, bulletin boards, blackboards, slogans and other forms to publicize and popularize quality honesty awareness and quality legal awareness publicity and education, and improve the quality culture construction awareness of the majority of employees. According to the company's deployment, the branch factory has held training courses with the theme of "quality first, honesty first" for many times, educated employees on quality culture construction, further improved the quality culture construction awareness of the majority of employees, and established the "quality first, honesty first" business philosophy.

⑵ Scientific quality management model, optimize organizational structure, improve internal quality supervision mechanism, and strive to improve the scientific and technological content of quality management

In light of its own reality, the company has established an effective quality control and quality assurance mechanism from manufacturing process to after-sales service, strictly checking at every level, improving the quality management system, implementing the quality responsibility system, establishing a quality incentive competition mechanism, and fully mobilizing the enthusiasm of all employees to participate in quality management activities.

⑶Reward system

The reward system is to start from the needs of front-line workers, attach importance to spiritual encouragement, and issue quality certificates to those who have excellent product or service quality. Spiritual encouragement often beats simple material rewards. Appropriate incentives and recognition inspire employees' enthusiasm. A large number of practices have shown that incentives and recognition help to create a good quality culture atmosphere. To create a people-oriented quality culture, we must motivate employees based on scientific incentive theories and fully consider the level of employees' needs. When arranging work for employees, we should try our best to make the best use of their talents, and at the same time, we should make clear rewards and punishments, objectively evaluate employees' work, and let employees fully understand the existing problems, while enhancing their self-motivation ability and enterprising spirit, which plays a positive role in promoting employees to work better. In addition, by improving the content of work, working environment and working methods, employees can develop an enterprising spirit, enthusiasm for hard work and satisfaction. In short, through appropriate incentives and recognition of employees, it can help enterprises create a good corporate quality culture atmosphere, so that employees' personal quality awareness and the overall work quality of the enterprise have been improved.

4. Enterprise quality foundation

4.1 Enterprise product standards

Our company strictly abides by the safe operating procedures of each workshop process and conscientiously implements the quality management system, which effectively improves the company's management level and awareness of standards, making our company's standardization work more standardized and orderly.

4.2 Enterprise measurement level

The company has established a complete measurement and testing system. The company has a total of 50 sets of advanced measurement and testing equipment and 10 full-time and part-time measurement personnel, which can ensure the effectiveness and reliability of the company's measurement, testing and monitoring results.

5 Product Quality Responsibility

5.1 Product Quality Commitment

The company promises to strictly abide by the Product Quality Law and other laws and regulations related to product production, and fully fulfill the responsibility of the corporate legal person as the first person responsible for production safety.

The company solemnly promises to strictly implement the national safety standards of the "Product Quality Law" during production, and will never adulterate, counterfeit, pass off fake products as genuine ones, or pass off inferior products as good ones during the production process, and will not recycle raw materials for processing and production, etc. The company is determined to repay the consumers' love for Xinghang with high-quality products and sincere after-sales service.

5.2 Product recall

The company has formulated a complete set of rigorous and mature "Product Recall Control Procedures", which can effectively and quickly trace and recall products when there are quality and safety risks, ensuring that the relevant products with hidden dangers are recalled smoothly and accurately and effectively handled. In recent years, the company has never had an actual recall due to quality and safety accidents, and the company also uses regular and irregular return visits to collect and organize customer feedback on product quality information, and control it in the subsequent production process to improve product quality.

5.3 “Three Guarantees” Responsibilities

The company solemnly promises that if there are quality problems with the company's products, after a joint investigation by the company and relevant departments, it is confirmed that it is indeed the company's responsibility, the company will strictly implement the relevant laws and regulations such as the "Product Quality Law" and the "Consumer Rights Protection Law", and within the legal framework and in accordance with the wishes of consumers, the company's products will be refunded or replaced, and we will express our sincere apologies to consumers.

6 Quality Risk Management

6.1 Quality Complaint Handling

Casting is one of the basic processes of the modern machinery manufacturing industry. There may be various problems that need to be solved in all aspects of product sales, including after consumers purchase. Sales offices in various places are responsible for contacting consumers, solving problems based on customer complaints and suggestions, and registering the content of complaints and handling results. Each office reports the content of complaints and handling results to the after-sales service department in writing every day. The after-sales service department will summarize the opinions of consumers and put forward improvement suggestions, and then report them to the general manager's office meeting for approval and implementation. The marketing department conducts a customer satisfaction questionnaire survey on customers every year. The scope and content of the survey are updated and improved year by year, striving to achieve a wide sampling range and content closer to user needs. Data analysis is conducted on the sampling results, and opinions and suggestions are put forward to the company's leaders for decision-making.

6.2 Quality Risk Monitoring

The company has established the "Product Quality Risk Monitoring Information Collection System" in accordance with the "Product Quality Law of the People's Republic of China" and the "Regulations for the Implementation of the Product Quality Law" to collect product quality and safety risk monitoring information, timely discover potential product quality problems, and change the post-event "repair after the sheep have been lost" to pre-event prevention, that is, from "post-event supervision" to "pre-event prevention", so as to avoid the occurrence of product quality and safety accidents. Product safety risk monitoring information is mainly collected and sorted by the company's quality management department, the Quality Control Department, but all employees of the company have the responsibility and obligation to collect risk monitoring information. In order to ensure that the product safety risk monitoring information related to our company's products can be collected in a timely and accurate manner, the company always pays attention to maintaining technical exchanges and cooperation with international and domestic counterparts.

6.3 Emergency Management

In order to improve the company's emergency response capabilities for emergencies and dangerous situations, ensure that when major and serious accidents occur, the command and dispatch are smooth, and personnel, equipment and materials can be in place in time, ensure that the company can control the accident in a timely and effective manner, protect the lives of employees, the environment and national property safety, and minimize the loss of accidents, in accordance with the relevant provisions of the "Work Safety Law of the People's Republic of China", "Emergency Response Law of the People's Republic of China", "Management Measures for Emergency Plans for Production Safety Accidents", and combined with the actual situation of our company, formulate an emergency plan for production safety accidents. The emergency plan for production safety accidents is divided into two levels: comprehensive emergency plan and special emergency plan. The comprehensive emergency plan is the overall plan and procedural specification for the company to organize, manage, command and coordinate relevant emergency resources and emergency actions. The special emergency plan is a component of the overall plan and is an action plan and guarantee plan for different emergencies. In order to achieve accurate and timely response to emergency rescue, the company regularly organizes employees to conduct emergency drills, and improves and perfects the problems in the drills to ensure that when an emergency occurs, the emergency plan can be activated to avoid risks and reduce harm.

Conclusion

In 2016, the market environment is still full of uncertainties. The company will actively seize opportunities, enhance its brand image and promote business development. At the same time, the company will continue to implement the concept of quality responsibility and make quality responsibility awareness move forward in tandem with the company's development. The quality management work in 2017 will be carried out with the implementation of quality strategy, the construction of quality management system, the improvement of key quality performance indicators and standardized management as the core.

Fujian Xinghang Machinery Casting Co., Ltd.

December 31, 2016