Submission on the selection of independent auditing agency for the financial reports in the year of 2018, 2019, 2020

The contract for the provision of auditing services, revision of the financial reports between Baoviet Holdings BVH and Ernst & Young Vietnam Ltd EY Vietnam shall end after EY completes

IET S Holdings CONG HOA XA HOI CHỦ NGHĨA VIET NAM

Độc lập - Tự do - Hanh phúc

Hanoi, dated 16th May 2017

SUBMISSION

Re: The selection of the independent auditing agency for the Financial

Reports in the years of 2018, 2019, 2020 for Baoviet Holdings

Respectfully submit to: The 2017 Annual General Shareholders’ Meeting of

Baoviet Holdings

In pursuant with:

- The Enterprises Law No 68/2014/QH13 dated 26'" November 2014 of

the Socialist Repulic of Vietnam;

- The Tendering Law No 43/2013/QH13 dated 26" November 2013 of

the Socialist Republic of Vietnam;

- The current Charter of Baoviet Holdings

The contract for the provision of auditing services, revision of the financial

reports between Baoviet Holdings (BVH) and Ernst & Young Vietnam Ltd (EY

Vietnam) shall end after EY completes the auditing and revision of the 2017

financial reports of Baoviet Holdings Upon the obligation to implement as

stipluted by the Charter of Baoviet Holdings, the Supervisory Board of BVH

(SB) would like to respectfully submit to the 2017 Annual General

Shareholders’ Meeting (AGM) of BVH the selection of the independent

auditing agency for the financial reports in the years of 2018, 2019, 2020 for

BVH as follows:

1 The references and benefits of hiring an independent auditing agency to

implement the long term auditing of financial reports:

The signing of the long-term auditing contract is not illegal against any

regulations stipulated by neither the law of Vietnam or any accouting, auditing

standards of Vietnam Simultaneously, such signing is competible with the

standards and trends of big coorporations worldwide On the process of

assessing the signing of the long term auditing contracts, BVH considers and

foresees the fundamental benefits of such activities as follows:

- First, to ensure the completion and disclosure of the audited financial

reports in due time at the best quality: The signing of long term contract

for auditing financial reports shall help the auditing agencies construct a

long term plan to ensure the consistent staff with deep knowledge in the

field of auditing, who can provide better understandings in the systematic

organisation, corporate governance of the audited companies Such doing

8 Lê Thái Tổ, Hoàn Kiếm, Hà Ndi | Tel (+84 4) 3928 9999 | Fax (+84 4) 3928 9609 | Email service @baoviet.com.vn

shall help to improve the work efficiency between the auditing officers and

the staff of the audited companies, fostering the completion of the audited

reports, revised reports of the financial reports in order to ensure the quality

and deadlines for disclosure of the audited and revised financial reports for

listed companies

- Second, such consistent auditing fees to ensure the level of reasonability:

The signing of the long term auditing contract shall help BVH to maintain

the consistency in the auditing expenses, throughout the years, the auditing

fees applied to BVH has changed but insignificantly (the maximum

amplitude of changes is 5% p.a) within the context of increasing labour

expenses

- Third, to provide a promoting, free and less time-consuming services, the

expenses in selecting an auditing agency every year: Signing the long term

contract for auditing financial reports shall not only improve the efficiency,

reduce the time on the operation, auditing and revision of the financial

reports, but also offer to BVH a better, free services from the auditing

agency as well as the organisation of training sections, conferences in order

to keep updated with the most recent legal documents on the regimes,

accounting policies, taxation, exchange of knowledge, consultancy on the

implementation of financial solutions; from which contributes significantly

to the the improvement of the knowledge, experience, management skills as

well as the corporate governance in the business activities Besides, such

signing activity also helps to reduce the time and effort of the SB, BOD,

BOM, Finance-Accounting Division and other related departments to the

work of selecting an auditing agency annually

2 Regarding the guidelines, methods of selecting an independent

auditing agency

According to the types of business and the audting demand of BVH and its

Subsidiaries, the SB would like to respectfully propose to the AGM on the

criteria, format for selection of the independent auditing agency as follows:

a/ Guidelines for selecting the auditing agency:

- An international reputable auditing agency legally operating in Vietnam,

approved by the State Security Commission of Vietnam (SSC) to implement the

auditing activities for issued organisations, listed organisations and the stock;

- An auditing agency with an Actuary professional group and a highly

experienced auditing staff with outstanding experience in auditing financial

reports in the field of insurance, fund management, stock exchange, banking as

stipulated by the International standards, Vietnam Accounting Standards (VAS)

and the International Financial Reporting Standards (IRFS);

j i i> iim

pet

| I

- Having no conflict in the benefits upon the implementation of auditing

financial reports for BVH (The auditing of financial reports must be implmented

independently from the consultancy on drafting the financial reports and the

internal audit activities);

- Offering a reasonable price for auditing, relevant to the content, scope

and progress of auditing financial reports upon the request of BVH;

- Provision of attractive, free services for BVH

b/ Methods of selecting the auditing agency:

The above guidelines shall be considered as high requirements on the

techniques and specification of auditing financial reports in the field of finance-

insurance According to the regulations stipulated in Article 21 of the 2013

Tendering Law (The limited tendering shall be applicable in case of such high

requirements on techniques or specialised specifications of the tendering

contract which only a few contractors can meet), SB shall propose the methods

of selecting the tenderees as the limited tendering contract

3 Proposal on selecting the independent auditing agencies to be on the short

list:

According to the above guidelines, SB would like to respectfully propose the

short list (for limited tendering) including 04 International reputable auditing

agencies with outstanding reputation, capability and experiences, legally

operating in Vietnam as well as being approved by the SSC to implement the

auditing activities for issued organisations, listed organisations and the stock

trading organisations in 2017 as follows:

- Deloitte Vietnam;

- Ernst & Young Vietnam;

- KPMG Vietnam;

- Price Waterhouse Cooper Vietnam

4 Proposal of the SB

According to the proposals above, SB would like to respectfully submit to the

2017 AGM:

- To approve the directions on the selection and signing of the long term

auditing contract with 01 auditing agency for auditing, revising financial reports

of BVh in the 3 fiscal years of 2018, 2019, 2020

- To approve the short lists of indenpendent auditing agencies as mentioned

in the Section 3 so that SB can use as a guideline to select, propose an

independent auditing agency for auditing and revising financial reports of BVH

in the fiscal years of 2018, 2019, 2020

- To authorise the BOD: (i) to implement the tasks of the competent

individual(s); (ii) to organise, implement the entire related work as stipulated by

the Tendering Law, (iii) to select a contractor — an independent auditing agency

~©

CC iw

VIỆ

for auditing financial reports of BVH in the fiscal years of 2018, 2019, 2020

according to the proposal of the SB

- To assign the SB to participate, chair the implementation of tasks as the

tenderer as stipulated by the Tendering Law

- To assign the CEO of BVH to sign the contract on the service provision

in auditing financial reports with the selected independent auditing agency in

order to implement the auditing and revision of financial reports of BVH in the

fiscal years of 2018, 2019, 2020

Respecfully submit./

ON BEHALF OF THE SUPERVISORY BOARD

- As above;

- CEO;

- For filing: Admin, SB

Nguyen Ngoc Thuy