Audit Committee

The Audit Committee comprises four Independent Non-executive Directors. The Charter of the Audit Committee clearly defines the status, qualifications, work procedures, duties and responsibilities, funding and remuneration, etc. of the Audit Committee. The Audit Committee’s principal duties include the supervision of the truthfulness and completeness of the Company’s financial statements, the effectiveness and completeness of the Company’s internal control and risk management system as well as the work of the Company’s internal audit department. It is also responsible for the supervision and review of the qualifications, selection and appointment, independence and services of external independent auditors. The Audit Committee ensures that the management has discharged its duty to establish and maintain an effective internal control system including the adequacy of resources, qualifications and experience of staff fulfilling the accounting and financial reporting function of the Company together with the adequacy of the staff’s training programmes and the related budget. The Audit Committee also has the authority to set up a reporting system to receive and handle cases of complaints or complaints made on an anonymous basis regarding the Company’s accounting, internal control and audit matters. The Audit Committee is responsible to and regularly reports on its work to the Board.

In 2011, pursuant to the requirements of the governing laws and regulations of the places of listing and the Charter of the Audit Committee, the Audit Committee fully assumed its responsibilities within the scope of the clear mandate from the Board. The Audit Committee proposed a number of practical and professional recommendations for improvement based on the Company’s actual circumstances in order to promote the continuous improvement and perfection of corporate management. The Audit Committee has provided important support to the Board and played a significant role in protecting the interests of independent shareholders.

In 2011, the Audit Committee convened four meetings, in which it reviewed important matters related to the Company’s financial statements, assessment of the qualifications, independence and performance of the external auditors and their appointments, effectiveness of internal control, internal audit and connected transactions. The Audit Committee received quarterly reports in relation to the internal audit and connected transactions and provided guidance to the internal audit department. Additionally, the Audit Committee reviewed the internal control assessment report and the attestation report, followed up with the recommendations proposed by the external auditors, reviewed the U.S. annual report, and communicated independently with the auditors twice a year.

Attendance rates of individual members of the Audit Committee in 2011 (including attendance by written proxies)

Number of Committee members4 

Percentage of Independent Non-executive Directors of the Committee100% 

	Member of the Committee	The Third Session of the Audit Committee Number of Attendance/ Meeting	Attendance Rate
	Tse Hau Yin, Aloysius (Chairman of the Committee)	1/1	100%
	Wu Jichuan	1/1	100%
	Qin Xiao	1/1	100%
	Xu Erming	1/1	100%

	Member of the Committee	The Fourth Session of the Audit Committee Number of Attendance/ Meeting	Attendance Rate
	Tse Hau Yin, Aloysius (Chairman of the Committee)	3/3	100%
	Wu Jichuan	3/3	100%
	Qin Xiao	3/3	100%
	Xu Erming	3/3	100%

Remuneration Committee

The Remuneration Committee comprises four Independent Non-executive Directors. The Charter of the Remuneration Committee clearly defines the status, qualifications, work procedures, duties and responsibilities, funding and remuneration, etc. of the Remuneration Committee. The Remuneration Committee assists the Company’s Board to formulate overall remuneration policy and structure for the Company’s Directors and senior management personnel, and to establish related remuneration procedures that are standardised and transparent. The Remuneration Committee’s principal duties include supervising the compliance of the Company’s remuneration system with legal requirements, presenting the evaluation report on the Company’s remuneration system to the Board, as well as giving recommendations to the Board in respect of the overall remuneration policy and structure for the Company’s Directors and senior management personnel. Its responsibilities comply with the requirements of the Code on Corporate Governance Practices. The Remuneration Committee regularly reports its work to the Board. One meeting was held by the Remuneration Committee in year 2011, giving advice to the remuneration policy of Directors for the fourth session of the Board.

The Charter for the Remuneration Committee was amended and approved by the Board on 9 December 2011. The amended Charter implements the recent proposed amendments of the Code on Corporate Governance Practices in the Listing Rules, which will become effective in April 2012. The amended Charter can be browsed on our website at www.chinatelecom-h.com.

Attendance rates of individual members of the Remuneration Committee meeting in 2011 (including attendance by written proxies)

Number of Directors4 

Percentage of Independent Non-executive Directors of the Committee100% 

	Directors	The Fourth Session of the Remuneration Committee Number of Attendance/ Meeting	Attendance Rate
	Xu Erming (Chairman of the Committee)	1/1	100%
	Wu Jichuan	1/1	100%
	Qin Xiao	1/1	100%
	Tse Hau Yin, Aloysius	1/1	100%