Core Insights - The walnut industry in Shandong has seen significant growth, with a planting area of 3.1 million acres and an annual output of 138,000 tons, generating a comprehensive output value exceeding 5 billion yuan [1][3] - The walnut industry in Luonan County contributes nearly half of the total walnut industry output value in Shandong, reaching 2.45 billion yuan in 2024 [1][3] Industry Overview - Luonan County has established a nationwide walnut procurement network, sourcing over 50,000 tons of walnuts from various major production areas across China [2] - The walnut has a long history in Shandong, dating back to the Han Dynasty, and has become a significant agricultural product, earning the title of "China's Walnut Capital" in 2010 [3] Technological Advancements - The introduction of rare walnut varieties, such as the red kernel walnut, has enhanced the quality and marketability of Shandong walnuts [3][4] - Companies are innovating by utilizing walnut shells for various products, including cat litter and organic fertilizers, showcasing the comprehensive use of walnut resources [4][5] Product Development - The walnut mooncake has emerged as a popular local delicacy, highlighting the diversification of walnut products in the region [5][6] - New products like chocolate-coated walnut snacks have been developed, indicating a trend towards innovative food products in the walnut industry [7] Export and Global Reach - The walnut products from Shandong have begun to penetrate international markets, with significant exports to countries like Kazakhstan and Kyrgyzstan [9][11] - The establishment of the Northwest Walnut Logistics Park has facilitated the processing, storage, and sale of walnut products, enhancing the region's export capabilities [11][12] Future Prospects - The brand value of "Luonan Walnut" is projected to reach 3 billion yuan by 2025, reflecting the growth potential of the walnut industry [11] - Companies in the region are aiming for a transformation towards a billion-level food industry, leveraging logistics and e-commerce to expand their market reach [11][12]

Core Viewpoint - The internal control evaluation report of Chengde Lulux Co., Ltd. indicates that there are no significant defects in both financial and non-financial internal controls as of December 31, 2024, affirming the effectiveness of the company's internal control system [3][31][32]. Internal Control Evaluation Conclusion - The company has identified no significant defects in financial reporting internal controls as of the evaluation report date [3][31]. - There are also no significant defects in non-financial reporting internal controls [3][32]. - The internal control audit opinion aligns with the company's evaluation conclusion regarding the effectiveness of financial reporting internal controls [3]. Internal Control Evaluation Work Situation - In 2024, the company focused on enhancing its internal control system, including organizational structure, employee training, and information management [4]. - The company engaged Tianzhi International Accounting Firm for independent auditing of financial statements and internal control effectiveness [4]. Internal Control Evaluation Scope - The evaluation covered all major units, businesses, and high-risk areas, including governance, strategic development, human resources, and financial reporting, among others [6][7][8][9][13][14][16][17][20][21][22][23][24][25][26][30]. Company Governance - The company has established a comprehensive governance structure in compliance with relevant laws and regulations, ensuring effective operation of its board and committees [6]. Development Strategy - The company aims to lead the plant-based beverage industry by enhancing its brand, product, and technology competitiveness, focusing on market demand changes and product innovation [7]. Human Resources - The company has implemented human resource policies that support sustainable development, emphasizing ethical standards and professional competence in employee selection [8]. Corporate Culture - The company promotes a positive corporate culture that emphasizes integrity, dedication, innovation, and teamwork [9]. Financial Management - The company has established strict financial management systems to ensure effective control over monetary funds and investment activities [13]. Contract Management - The company has developed a comprehensive contract management system to ensure compliance and effective execution of contracts [14]. Sales Management - The company utilizes an ERP system to manage sales processes, ensuring effective control and minimizing bad debt risks [16]. Asset Management - The company has implemented a robust asset management system to ensure the safety and accuracy of its asset records [17]. Investment Management - The company adheres to principles of prudence and transparency in external investment management, ensuring compliance with regulations [18]. Financial Reporting - The company employs an ERP system for unified financial management, ensuring the accuracy and completeness of financial reports [20]. Comprehensive Budget - The company promotes comprehensive budget management, ensuring strict control over budget execution and regular analysis [21]. Related Party Transactions - The company has established a management system for related party transactions to ensure fairness and protect the interests of minority shareholders [22]. Internal Information Transmission - The company has set up a system for internal communication to ensure timely and accurate information flow [23]. Information Disclosure - The company has developed management systems for information disclosure to ensure compliance with regulations and accuracy of disclosed information [24]. Internal Supervision - The company's audit committee oversees internal control and audit activities, ensuring compliance and timely reporting of any deficiencies [25].