ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
SHENZHEN PROPERTIES & RESOURCES
DEVELOPMENT (GROUP) LTD.
ANNUAL REPORT 2018
（Announcement No. 2019-12）
March 2019
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Table of Contents
Part I Important Notes, Table of Contents and Definitions ........................................................... 3
Part II Corporate Information and Key Financial Information ................................................... 5
Part III Business Summary ............................................................................................................. 10
Part IV Operating Performance Discussion and Analysis ........................................................... 16
Part V Significant Events ................................................................................................................ 38
Part VI Share Changes and Shareholder Information ................................................................. 49
Part VII Preferred Shares ............................................................................................................... 59
Part VIII Directors, Supervisors, Senior Management and Staff................................................ 60
Part IX Corporate Governance ...................................................................................................... 70
Part X Corporate Bonds .................................................................................................................. 77
Part XI Financial Statements .......................................................................................................... 78
Part XII Documents Available for Reference .............................................................................. 226
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of ShenZhen Properties & Resources Development
(Group) Ltd. (hereinafter referred to as the “Company”) hereby guarantee the factuality,
accuracy and completeness of the contents of this Report and its summary, and shall be
jointly and severally liable for any misrepresentations, misleading statements or material
omissions therein.
Liu Shengxiang, the Company’s legal representative, Cai Lili, the Company’s head of
financial affairs, and Liu Qiang, head of the Company’s financial department (equivalent to
financial manager) hereby guarantee that the Financial Statements carried in this Report are
factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on
Information Disclosure by Industry—for Listed Companies Engaging in Real Estate, for
which it is required to include in this Report the changes in the country’s real estate policy
and the related financial policy, as well as the supply and demand changes in the real estate
sector.
The Board has approved a final dividend plan as follows: based on the 595,979,092 shares, a
cash dividend of RMB3.00 (tax inclusive) per 10 shares is to be distributed to the shareholders,
with no bonus issue from either profit or capital reserves.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Definitions
Term Definition
ShenZhen Properties & Resources Development (Group) Ltd. and its
The ―Company‖, the ―Group‖, ―SZPRD‖ or ―we‖
consolidated subsidiaries, except where the context otherwise requires
SIHC Shenzhen Investment Holdings Co., Ltd.
SCIHC Shenzhen Construction Investment Holdings Corporation
SIM Shenzhen Investment Management Co., Ltd.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name PRD, PRD-B Stock code 000011, 200011
Changed stock name (if any) N/A
Stock exchange for stock
Shenzhen Stock Exchange
listing
Company name in Chinese 深圳市物业发展(集团)股份有限公司
Abbr. 深物业集团
Company name in English (if
ShenZhen Properties & Resources Development (Group) Ltd.
any)
Abbr. (if any) SZPRD
Legal representative Liu Shengxiang
39/F and 42/F, International Trade Center, Renmin South Road, Shenzhen, Guangdong Province,
Registered address
P.R.China
Zip code 518014
39/F and 42/F, International Trade Center, Renmin South Road, Shenzhen, Guangdong Province,
Office address
P.R.China
Zip code 518014
Company website www.szwuye.com.cn
Email address 000011touzizhe@szwuye.com.cn
II Contact Information
Board Secretary Securities Representative
Name Fan Weiping
Qian Zhong and Ding Minghua
42/F, International Trade Center, Renmin 42/F, International Trade Center, Renmin
Address South Road, Shenzhen, Guangdong South Road, Shenzhen, Guangdong
Province, P.R.China Province, P.R.China
Tel. 0755-82211020 0755-82211020
Fax 0755-82210610 82212043 0755-82210610 82212043
Email address 000011touzizhe@szwuye.com.cn 000011touzizhe@szwuye.com.cn
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
III Media for Information Disclosure and Place where this Report Is Lodged
Newspapers designated by the Company for For A-stock investors: Securities Times
information disclosure For B-stock investors: Ta Kung Pao (HK)
Website designated by CSRC for publication of this
www.cninfo.com.cn
Report
Board Office, 42/F, International Trade Center, Renmin South Road,
Place where this Report is lodged
Shenzhen, Guangdong Province, P.R.China
IV Change to Company Registered Information
Unified social credit code No change
Change to principal activity of the
No change
Company since going public (if any)
On 29 September 2004, the State-Owned Assets Supervision and Administration
Commission of Shenzhen Municipality (―SASAC Shenzhen‖) decided to incorporate
Shenzhen Investment Holdings Co., Ltd. (―SIHC‖) to include Shenzhen Investment
Management Co., Ltd. (―SIM‖, the former controlling shareholder of the Company)
and Shenzhen Construction Investment Holdings Corporation (―SCIHC‖). SCIHC and
Every change of controlling shareholder SIM hold 323,796,324 and 56,582,573 shares respectively in the Company,
since incorporation (if any) representing a combined stake of 63.82%.
On 19 October 2018, the Company was notified by its actual controlling shareholder
SIHC that it had received the Confirmation of Securities Transfer Registration from
China Securities Depository and Clearing Co., Ltd. (Shenzhen branch), marking the
completion of the equity transfer to SIHC. As such, SIHC has become the controlling
shareholder of the Company.
V Other Information
The independent audit firm hired by the Company:
Name Ruihua Certified Public Accountants LLP
9-10/F, Taiping Finance Tower, 6001 Yitian Road, Futian District, Shenzhen City, Guangdong
Office address
Province, China
Accountants writing signatures Cai Xiaodong and Wang Huansen
The independent sponsor hired by the Company to exercise constant supervision over the Company in the Reporting Period:
□ Applicable √ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the Company in the Reporting Period:
□ Applicable √ Not applicable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
2018-over-2017
2018 2017 2016
change (%)
Operating revenue (RMB) 2,787,240,632.53 2,904,690,690.53 -4.04% 2,059,204,077.18
Net profit attributable to the listed
592,723,852.71 622,962,734.37 -4.85% 354,857,241.74
company‘s shareholders (RMB)
Net profit attributable to the listed
company‘s shareholders before 591,362,024.37 559,625,850.90 5.67% 357,519,344.14
exceptional items (RMB)
Net cash generated from/used in
1,123,594,927.59 -346,269,760.94 424.49% 2,252,041,183.42
operating activities (RMB)
Basic earnings per share
0.9945 1.0453 -4.86% 0.5954
(RMB/share)
Diluted earnings per share
0.9945 1.0453 -4.86% 0.5954
(RMB/share)
Weighted average return on equity
18.94% 26.64% -7.70% 15.79%
(%)
Change of 31
December 2018 over
31 December 2018 31 December 2017 31 December 2016
31 December 2017
(%)
Total assets (RMB) 5,820,202,137.54 5,393,331,548.87 7.91% 6,654,356,144.10
Equity attributable to the listed
3,337,949,324.64 2,921,693,794.08 14.25% 2,410,434,735.75
company‘s shareholders (RMB)
VII Accounting Data Differences under China’s Accounting Standards for Business
Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign
Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
No difference for the Reporting Period.
VIII Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 544,366,414.09 280,647,570.88 373,989,694.46 1,588,236,953.10
Net profit attributable to the listed
53,456,824.88 29,515,702.71 61,216,163.81 448,535,161.31
company‘s shareholders
Net profit attributable to the listed
company‘s shareholders before 53,039,124.57 28,924,009.75 61,962,097.63 447,436,792.42
exceptional items
Net cash generated from/used in
-96,704,935.74 -128,887,050.07 275,573,016.00 1,073,613,897.40
operating activities
Indicate by tick mark whether any of the quarterly financial data in the table above or their summations differs materially from what
have been disclosed in the Company‘s quarterly or interim reports.
□ Yes √ No
IX Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item 2018 2017 2016 Note
Gain or loss on disposal of non-current
Disposal of
assets (inclusive of impairment allowance -79,489.58 104,883,756.37 -182,886.11
miscellaneous assets
write-offs)
Government subsidies charged to current
profit or loss (exclusive of government
subsidies given in the Company‘s ordinary The subsidy for
165,676.08
course of business at fixed quotas or keeping stable jobs
amounts as per the government‘s uniform
standards)
Gain or loss on contingencies that do not
arise in the Company‘s ordinary course of -5,491,792.67 -4,366,315.82
business
Non-operating income and expense other Penalty and liquidated
1,724,017.41 -466,062.66 1,010,733.64
than the above damages income
Less: Income tax effects 448,375.57 35,589,017.57 -876,365.89
Total 1,361,828.34 63,336,883.47 -2,662,102.40 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss
Items:
□ Applicable √ Not applicable
No such cases for the Reporting Period.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part III Business Summary
I Principal Activity of the Company in the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
Yes, because the Company engages in real estate.
(I) Core Business Overview
Shenzhen Property Group was established in November 1982 that the predecessor was Luohu Engineering Construction
Headquarters and renamed to Shenzhen Municipal Property Development Corporation in August 1985. The Company was
determined as the second batch of pilot units for joint-stock reform of state-owned enterprises in 1988. Approved by the municipal
government, the Company renamed to Shenzhen Properties & Resources Development (Group) Ltd. (SZPRD) in April 1990. The
stock of the group company (Shenzhen Property A+B; securities code 000011/200011) was officially listed in Shenzhen Stock
Exchange in March 1992. The Company is headquartered in International Trade Centre Building, Renmin South Road, Luohu
District.
At its inception, the Company contracted and built Shenzhen International Trade Centre Building as Party A, and created the
world-famous "Shenzhen Speed" that "one floor was completed in three days". International Trade Centre Building ranked the first
place in several places in China: It was the first super-high-rise building in China, which has occupied the position of "the tallest
building in the country" for ten years; It was the first building project involving bidding in China. It is the landmark building in
Luohu and even Shenzhen, a resounding historical and cultural symbol in Shenzhen and the "cultural card in Shenzhen". It was
selected into the first batch of 45 historical buildings in Shenzhen and became "The Reflection of the Shenzhen Speed and the
Symbol of the Reform and Opening-up" with a reputation for the whole country and even the world. The enterprise spirit of "going
ahead and reforming" of Shenzhen Property Group has also become the spiritual totem of the numerous entrepreneurs in Shenzhen.
The three generations of leaders of the Party and the State are very concerned about the growth and development of the Company.
On 22 June 1990, Comrade Jiang Zemin inspected the International Trade Centre Building and commemorated the inscription; On 20
January 1992, Comrade Deng Xiaoping overlooked Shenzhen in the revolving restaurant at the 53rd floor of the International Trade
Centre Building, and delivered a 30-minute "South Inspection Speech"; On 13 November 1994, Comrade Hu Jintao personally
inspected the Company and commemorated the inscription.
Since its establishment 37 years ago, the Company has developed into a large-scale comprehensive group company from a simple
project company at that time, taking Luohu as its base area and radiating all over the country. The group has successively won a
number of honors, such as the second place of "Top-100 Real Estate Enterprises with Comprehensive Benefits in China", the 23rd
place of the first rating of "Top 100 Companies with Comprehensive Strength of Listed Companies in China", "Top-500 Real Estate
Development Enterprises in China" for eight consecutive years (2011-2018), the 35th place of "National Property Service Industry in
2018", the fourth place of "Excellent property Management Enterprises in China's Industrial Park in 2017", etc.
The Company currently has 9 functioning secondary subsidiaries in total, including 4 property development subsidiaries (Shenzhen
Huangcheng Real Estate Co., Ltd., Dongguan ITC Changsheng Real Estate Development Co., Ltd., SZPRD Xuzhou Dapeng Real
Estate Development Co., Ltd. and SZPRD Yangzhou Real Estate Development Co., Ltd.), 1 property management subsidiary, 1
housing assets operation subsidiary, 2 joint ventures (SZPRD Jifa Warehouse Co., Ltd. and Shenzhen Tian‘an International Building
Property Management Co., Ltd., with the Company holding a 50% stake in both), and 1 catering subsidiary.
1. Property Development
The property development business is principally operated by 4 subsidiaries. Those four subsidiaries are Shenzhen Huangcheng Real
Estate Co., Ltd., Dongguan ITC Changsheng Real Estate Development Co., Ltd., SZPRD Xuzhou Dapeng Real Estate Development
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Co., Ltd., and SZPRD Yangzhou Real Estate Development Co., Ltd. The following 6 property developments are currently ongoing:
(1) SZPRD-Golden Collar‘s Resort (Shenzhen): Located at the Huanggang Port, historical land, site area 12,600 ㎡, plot ratio 10.5,
total floor area 130,000 ㎡ and sales have started in 2018.
(2) SZPRD-Qianhai Gangwan Garden (Shenzhen): Obtained in July 2011 in an asset swap promised in the share reform, site area
19,900 ㎡, plot ratio 3.2, total land price RMB270 million, open for sale in November 2015 and is currently selling the remaining
houses.
(3) SZPRD-Songhu Langyuan (Dongguan): Won on 15 July 2010, site area 66,900 ㎡, plot ratio 2.2, total land price RMB214
million, open for sale at the end of July 2015 and is currently selling the remaining houses.
(4) SZPRD-Fuhui Huayuan (Shenzhen): Located in Fumin New Village, Futian District, historical land, site area 4,274 ㎡, total floor
area 43,819 ㎡ and construction has officially begun on 29 December 2018.
(5) SZPRD-Hupan Yujing Phase I (Yangzhou): Won through bidding on 28 January 2011, site area 25,228 ㎡, and total floor area
50,948 ㎡. So far, residential units have been sold out and it is currently selling commercial and office space. SZPRD-Hupan Yujing
Phase II (Yangzhou): Site area 41,331 ㎡, and total floor area 74,382 ㎡. Currently, it is selling the remaining residential units, as
well as the commercial and office space.
(6) SZPRD-Banshan Yujing Phase I (Xuzhou): Won through bidding on 10 February 2010, site area 65,332 ㎡, and total floor area
101,605 ㎡. Currently, it is selling the remaining space. SZPRD-Banshan Yujing Phase II (Xuzhou): Site area 31,537 ㎡, and total
floor area 34,956 ㎡. Construction has begun in late 2018.
2. Property Management
This business is principally run by Shenzhen International Trade Center Property Management Co., Ltd., which has four subsidiaries,
namely, Shenzhen Huangcheng Property Management Co., Ltd., Shandong International Trade Center Property Management Co.,
Ltd., Chongqing International Trade Center Property Management Co., Ltd. and Yangzhou Jingyue Property Management Co., Ltd.
Yangzhou Jingyue Property Management Co., Ltd. is a new joint venture incorporated in 2018, with the Company holding a 51%
interest. The establishment of this sub-subsidiary marked the Company‘s official entrance to the area of cultural and tourism property
management. International Trade Property Management Co., Ltd. has been developed into the domestic first-class industrial park
brand property service provider. At present, the Company has 14 branches and three national-level qualified enterprises in the whole
country, and employs more than 4,000 employees, including Hulun Buir, Manzhouli, Baoding in Southern Market, Shandong,
Shanghai, Zhejiang and Jiangsu in East China Market, Shenzhen and Dongguan in South China Market, etc. The Company manages
over 100 projects and covers an area of 16 million m2 (including the property park exceeding 5 million m2 (including trusteeship).
The Company has provided service for the famous enterprise parks (Huawei, Alibaba, Jingdong, Hikvision) and a large batch of
government property projects in Shandong and Chongqing with its excellent market competitiveness.
3. Property Rental
This was formerly run by the Leasing Center of the Group Headquarters, which has become SZPRD Housing Assets Operation and
Management Co., Ltd. in 2018, running independently. The Company has now a total floor area of 81,610.23 ㎡ available for rental,
with an occupancy rate of 95%.
4. Catering Service
The catering business of the Company is operated by Shenzhen International Trade Catering Co., Ltd., with a total operating area of
1,892 square meters. Shenzhen International Trade Catering Co., Ltd. was established in 1986. The revolving restaurant under the
operation of the Company has been listed as "The Highest-level Revolving Restaurant in China" by the State Council, and is also the
only revolving restaurant in the country that runs Chinese food. Located on the 53rd floor of the International Trade Centre Building,
the restaurant has received more than 600 Party and state leaders, domestic and foreign dignitaries, and cultural celebrities. The
restaurant is also a scenic spot with unique historical significance in Shenzhen.
5. Warehousing Service
The warehousing service is mainly provided by SZPRD Jifa Warehouse Co., Ltd., a joint venture where the Company holds a 50%
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
stake, with the total area of the warehouses reaching 35,000 ㎡.
(II) The Development Stage, Periodic Features and Status of The Company’s Industry Involved within the Reporting Period
The development of the industry the Company is in is closely related to the development of the national economy and
orientation of national policy with positive correlation with economic cycle fluctuations.
1. Real Estate
In March 2018, the government work report during the two sessions further emphasized the positioning of ―Houses are for living in,
not for speculating on‖, and defined the local subject‘s responsibilities so as to continue the differentiated regulation and control,
establish a sound long-term mechanism, and promote the stable and healthy development of the real estate market. Under the
guidance of this general idea, the market has begun to show favorable trend at a moderate growth speed.
In 2018, the sales area of commercial houses was 171.654 million square meters with a year-on-year increase of 1.3%, but the growth
rate dropped by 0.1 percentage point when compared to that from January to November and declined 6.4 percentage points when
compared to that in last year. However, the sales volume of commercial houses achieved RMB 1,499.7 billion yuan with an increase
of 12.2% (increasing 0.1 percentage point when compared to that from January to November and dropping by 1.5 percentage points
when compared to that in last year). At present, the current real estate inventory has been massively sold out to reach a record low
value. At the end of 2018, the area of commercial houses for sale was 524.14 million square meters, decreasing 2.14 million square
meters from that at the end of November, and decreasing 65.1 million square meters from that at the end of the previous year.
The growth rate of land transfer revenue and the real estate investment maintained at a higher level, which can facilitate the transition
from the strict policy to the tolerant policy. From January to December in 2018, the nationwide real estate development investment
reached RMB 1202.64 billion yuan with a year-on-year increase of 9.5%, and the growth rate declined 0.2 percentage point when
compared to that from January to November while increasing 2.5 percentage points when compared to that during the same period
last year. In 2018, the land acquisition area of real estate enterprises was 291.42 million square meters with a year-on-year increase of
14.2%, but the growth rate declined 0.1 percentage point when compared to that from January to November while dropping 1.6
percentage points when compared to that during the same period last year. The land transaction price amounted to RMB 1610.2
billion yuan with a year-on-year increase of 18.0%, but the growth rate declined 2.2 percentage points when compared to that from
January to November while decreasing 31.4 percentage points when compared to that during the same period last year.
The financing situation in 2018 was not so good, and the increase in the availability of funds was mainly driven by the self-raised
funds and the deposits for public recognition. In 2018, the real estate development enterprises received the available funds of RMB
1,659.6 billion yuan with a year-on-year increase of 6.4%, but the growth rate dropped by 1.2 percentage points when compared to
that from January to November while declining 1.8 percentage points when compared to that last year. However, the domestic loans
were RMB 2,005 billion yuan, decreasing 4.9%; the utilized foreign capital reached RMB 10.8 billion yuan, declining 35.8%; the
self-raised funds were RMB 558.31 billion yuan, increasing 9.7%; the deposits and advances received were RMB 5541.8 billion yuan,
increasing 13.8%; the individual mortgage loans were RMB 2,370.6 billion yuan, declining 0.8%.
During 2018 Central Economic Work Conference, 2019 monetary policies were worked out with the emphasis placed on ―moderate
monetary policies shall achieve a proper balance and maintain the rational and sufficient flexibility‖ rather than ―neutral‖. From the
perspective of monetary policies, the central bank has carried out multiple RRR cuts, and in terms of financial supervision, it has
gradually shifted from ―Deleveraging‖ to ―Stabilizing leverages‖. On the whole, policies have become relatively loose. As the
proverb goes that ―the small river will spill when the big river is full of water‖, when the funds flowing into the real estate industry
are expected to increase, the real estate financing environment is expected to improve.
From the perspective of real estate policies, the two meetings of Political Bureau of the Central Committee respectively held on
October 31 and December 13, 2018 did not mentioned the real estate for two consecutive times since July 2015, but emphasized
―stable employment, stable financing, stable foreign trade, stable foreign investment, stable investment, and stable expectations‖.
Similarly, ―regulation and control‖ was not mentioned during 2018 Central Economic Work Conference on the deployment of real
estate policies in 2019, but emphasis was placed on ―building a long-term mechanism for the healthy development of the real estate
market; insisting on the positioning of Houses are for living in, not for speculating on‘; implementing different policies in line with
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
the actual situation under classified guidance; strengthening main responsibilities of the city‘s government; improving the housing
market system and the housing guarantee system‖, which indicates that the current real estate market price drop is consistent with the
forecast made by the central government, and the real estate policy has changed from ―regulated‖ to ―moderate‖. Looking forward to
2019, ―stabilized housing price‖ is the main keynote.
2. Property Management Industry
Up to now, the property management industry successively experienced the initial development period, the period of standardization
and the new diversified development period. As the industry continues to develop, various government departments are paying more
and more attention to the property management, and relevant laws and regulations have also been published in succession with the
policy content evolving from normative content to supportive and encouraging content.
In the future, various companies providing property services will accelerate their transformation and upgrading, and gradually
transform from traditional providers of property services to integrated providers of modern services. Through outsourcing traditional
property services to more specialized companies, refined and specialized division of labor can thus be realized; by providing
standardized ―Personal Butler‖ services based on hi-tech means, the owners‘ needs for life services can be satisfied; in combination
with fine-sorted, complete and professional outsourcing services, the quality of property services will be continuously improved to
create much more value for the owners. With new ideas and thought, various property service companies will pay much more
attention to the owners‘ diversified needs while improving their service efficiency and quality by means of high and new
technologies including the AI technology, and continue to strengthen the reserve of talents in order to realize the property
management service‘s standardization, the technological modernization, the business diversification, and the specialization of talents.
The sales area of nationwide commercial houses and affordable houses is expected to exceed 4 billion square meters from 2018 to
2020 in line with the internal and external macroeconomic environment. Taking the property management area of 24.665 billion
square meters in 2017 as the benchmark, the nationwide property management area will exceed 28.7 billion square meters in 2020; if
calculated based on the average property management fees charging standards of Top 100 Property Management Companies, China‘s
basic property management market size in the next five years will achieve RMB 1.5 trillion yuan.
In 2018, the property service industry became much more diversified and involved various fields including pension service, financing,
leasing, education, tourism, new retail and agriculture etc., and some property management companies have even built their own
brand. Based on the compound growth rate of 11.3% of total retail sales of consumer goods from 2012 to 2017, the total retail sales
of consumer goods in 2020 is estimated to reach RMB 62.56 trillion yuan. If the community business‘s proportion is 40% and the
community value-added service‘s market penetration rate is 13.5%, it can be comprehensively predicted that the community‘s
value-added property service scale could reach RMB 3.38 trillion yuan. By means of the diversified community-level value-added
service, various enterprises can enhance their own profitability, and stimulate the huge community terminal consumption resources,
which is vital to better the capital market.
3. Industrial Position of the Company
(1) The Company has won such titles as Top 500 Real Estate Development Companies in China and Top 500 Companies in
Guangdong for eight consecutive years, and obtained the honorary title of Top 100 Property Service Companies in China for three
consecutive years.
(2) As the Company‘s wholly-owned subsidiary, Shenzhen International Trade Center Property Management Co., Ltd. is the first
property management company positioned to office buildings in China. Up to now, its service area has exceeded 13 million square
meters, of which, the industrial park‘s property service area has exceeded 2.7 million square meters. Shenzhen International Trade
Center Property Management Co., Ltd. has also won various honorary titles including 2018 Annual Top 100 (ranking 35 th), and 2018
China‘s Outstanding Enterprises Specialized in the Property Management of Industrial Parks (ranking 4 th) etc..
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
II Significant Changes in Major Assets
1. Significant Changes in Major Assets
Major assets Main reason for significant changes
Up 3.28% from the beginning amount, primarily driven by gains on joint ventures
Equity assets
recognized at the equity method
Up 11.13% from the beginning amount, primarily driven by new purchases and the
Fixed assets
reclassification of certain investment property to fixed assets
Intangible assets No such assets
Construction in progress No such assets
Up 36.83% from the beginning amount, primarily driven by a larger inflow of sales
Monetary capital
revenue
Down 73.26% from the beginning amount, primarily driven by the receipt of the
Other receivables
payment for the sale of two taxi service subsidiaries
Down 36.14% from the beginning amount, primarily driven by the settlement on real
Inventory
estate projects in the Reporting Period
Up33.96% from the beginning amount, primarily driven by larger amounts of deductable
Deferred income tax assets
loss and land VAT provision
Up by RMB108.97 million from the beginning amount, primarily driven by prepayments
Other non-current assets
for investments
2. Major Assets Overseas
□ Applicable √ Not applicable
III Core Competitiveness Analysis
Is the Company subject to any industry-specific disclosure requirements?
Yes, because the Company engages in real estate.
In the recent years, the Company has maintained a stable business model with real estate as the core, supplemented by other diverse
operations. Its asset size, operating revenue and net profit have kept hitting new records, which is mainly attributed to the Company‘s
accurate market positioning and unique core competitiveness advantages:
The first is the enterprise spirit of "going ahead and reforming". The Company is headquartered in Shenzhen. The "Shenzhen Speed"
that "one floor was completed in three days" reflected the good style of work of Shenzhen Property personnel, such as taking courage
to explore, attacking and overcoming difficulties, advancing despite the difficulties, and being pragmatic and efficient, etc. The
enterprise spirit of "going ahead and reforming" has encouraged a generation of Shenzhen property people to seek for a higher and
stronger goal, and the continuous and healthy development of the Company.
Second, the Company has a stable operation team, which persists in the corporate development strategy, continuously making the 12th
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Five-Year Strategic Plan and the 13th Five-Year Strategic Plan and pioneering with the strategic plans as the guideline and road map,
thus ensuring the continuity of the Company‘s principal policy.
Third, the Company is currently adopting a mode of two levels, Group Headquarters - City Companies for controlling its property
development projects. At the headquarters level, the group mainly manages issues such as land investment, planned operation, key
marketing nodes, above-norm plan and design and cost control, while companies in the cities are engaged in project management,
on-site marketing, under-norm on-site design and cost control. Thus, the project companies are given sufficient independence. The
group focuses on systematic management, currently having established a standardized internal operation system such as Real Estate
Handbook, etc. for the comprehensive management policy for real estate. The Company‘s property control mode is being improved
and matured.
Fourth, the Company‘s development areas are mainly in Shenzhen and its neighboring cities, thanks to the price advantage of land
obtainment costs and the rapid development of Shenzhen‘s real estate market. The Company‘s regional projects in Shenzhen will
bring itself with good economic profits.
Fifth, the Company has an advantage in brand and culture condensation. Over more than 30 years of development and accumulation,
the Company is highly recognized in the market by virtue of its brand value of ―Shenzhen Properties & Resources‖ that carries the
spirit of international trade in the reform and opening up and comprehensive competence. The Company has won multiple honor
titles such as ―Best 500 of China Real Estate Developers‖ and ―Guangdong Top 500 Enterprises‖.
15
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part IV Operating Performance Discussion and Analysis
I Overview
(I) Review of industry development during the reporting period
1. Macroeconomic environment
In 2018, China's economic growth rate was declining, and the growth rate of GDP in four quarters was 6.8%, 6.7%, 6.5%, and 6.4%,
respectively. The growth rate in the third quarter has been lower than the operating ranged that has been kept for 12 quarters (6.7%～
6.9%). The Value-added of Industrial Enterprises Above Designated Size was 5.8% in September and reduced by 0.3% than that in
August. Since March 2016, it has fallen below 6% for the first time; The growth rate was 5.9% and 5.4% respectively in October and
November with a further decline.
More notably, the growth rate in consumer demand continued to decline. The year-on-year growth rate of Total Retail Sales of
Consumer Goods was 8.1% in October 2018, which was the lowest growth rate since June 2003; Affected by the continuous
declination in the growth rate of resident income, rapid increase in resident sector leverage ratio, weakening wealth effect and other
factors, the declining tendency of residents' consumption ability and willingness began to appear and the downward trend of
consumption demand became obvious.
In terms of investment, the downward pressure of real estate investment was increasing, the confidence of real estate enterprises in
the future market was insufficient, and the development and construction activities tended to shrink; Infrastructure investment growth
has fallen. After the Meeting of the political Bureau of the Central Committee on July 31, 2018, the growth rate became stable at a
low level after October with the steady growth of related measures. However, taking into account the lack of local government
financing capacity and other issues, the ability to pick up became further weak. Private enterprises, small and medium-sized
enterprises were faced with more difficulties, and lack of confidence, investment will and capacity in the future market. When the
domestic demand growth capacity was insufficient, the export growth rate also began to decline.
The Central Economic Work Conference convened in December 2018 pointed out that: The development of our country is still and
will be in the period of important strategic opportunity for a long time. We should be good at turning a crisis into an opportunity and
safety, firmly adhere to the new connotation of important strategic opportunities, accelerate the optimization and upgrading of the
economic structure, enhance the capacity for scientific and technological innovation, deepen the reform and opening up, speed up
green development, and participate in the reform of the global economic governance system, change the pressure to the driving force
to accelerate the high-quality development of the economy.
The meeting proposed that we should continue to adhere to the general tone of work of seeking progress stably, and that in view of
the changes in the situation and tasks, a series of new strategies have been made clear in terms of "stability" and "progress". The
meeting emphasized the need to innovate and improve macroeconomic regulation and control, ensure that the economy operates
within a reasonable range, further improve and implement stable employment, stable finance, stable foreign trade, stable foreign
investment, steady investment, and stable expectations, and propose three major policies in the macro economy, structure and society.
At the same time, more efforts should be made to work hard in the "progress". We must adhere to taking the supply-side structural
reform as the main line, take more measures of reform, make more use of market-oriented and legal means, and work hard in
"consolidation, enhancement, promotion and unblocking".
In accordance with the overall deployment of progress in a stable manner, we should do well in seven aspects in 2019, namely
promoting the high-quality development of manufacturing industry, promoting the formation of a strong domestic market, firmly
promoting the strategy of rural revitalization, promoting coordinated regional development, accelerating the reform of economic
system, promoting all-round opening-up, and strengthening the protection and improvement of people's livelihood. In view that the
16
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
economic fundamentals in China turn better and based on the overall arrangement of the central economic conference, it can be
predicted that in 2019, China's economy will show a tendency of "low base, steady progress, gradual rise". The annual growth of the
economy will be slightly higher than the previous year. The good situation of "seek progress while maintaining stability" in the
economy will be displayed continuously.
2. Industry pattern and trend analysis
International economic situation: It generally presents the characteristics of "three increases", namely increasing controversy
between multilateralism and unilateralism/conservatism in international trade; Increase in geopolitical conflict; Increase in the fight
between China and the US in economy, science and technology, trade and geographical relationship. But on the whole, it's still in a
situation of fighting and not breaking. The trade friction between China and the United States is likely to reach a more
comprehensive agreement than expected. The U.S. economy remains strong but there are hidden downside worries, and the pace of
interest rate increases in the dollar is expected to slow down. The world economy has struggled to recover and rebound in the midst
of a difficult dispute. Overall, the international economy in 2019 will not be worse than 2018.
Domestic economic situation: With the temporary truce of Sino-US trade friction, the national positive support and comprehensive
encouragement to the private enterprises and private economy, the policies of "deepening reform and expanding high-level
opening-up, as well as large-scale tax cuts and improvement of the business environment", the positive factors will appear in the
"stable and changing economy", the expectations of economic downturn stabilization will be strengthened, and the confidence will be
recovered and repaired to a certain degree. The bottom of politics and policy has appeared, but there are still a lot of uncertain factors.
Overall, the downward pressure on the domestic economy in 2019 is greater than that in 2018.
The pace and intensity of the battle to prevent and control financial risks and eliminate pollution will be significantly adjusted, and
the liquidity of social funds will be further abundant. Domestic real estate is still in a "stable with a slight decline" state and the price
continues to drop obviously. The transaction of new houses and second-hand houses is solidified and difficult to keep active. It is
expected that administrative regulation will not be increased throughout the year, and that market-oriented regulation will be valued
and returned to a certain extent. There will be a moderate increase in Inelastic Demand before and after the mid-year in the first-line
market. The inter-regional regulation and supervision policy is more obviously divided, and it is inevitable that there will be the
possibility of implementing local improvement measures and strengthening the market regulation. But regulation of the overall
situation will not be reversed. It is impossible to take a sharp rebound in housing prices within the year.
Economic situation in Shenzhen: On the whole, Shenzhen economy will remain the high-speed development trend because
Sino-US trade frictions have limited impact. Real estate will continue to maintain the strength and scope of the "7.31" new policy.
However, with the strong rise in Inelastic Demand and the recovery of confidence in economic development, Shenzhen will have a
high probability that price stability will increase from the second quarter, and real estate transactions in the second half of the year
will obviously recover. But it is unlikely that there will be a sharp rebound in prices. The good policies that benefit the real estate
transactions cannot be ruled out, such as relaxing the household policy, reducing the interest rate of the first loan, improving the
restrictions of lubrication trading and substantially increasing the liquidity
(II) Overview of The Company’s Business Operation in 2018
In 2018, the Company‘s economic operation made certain progress steadily, the quality was also improved, and major business
segments accordingly achieved major breakthroughs in stability.
Firstly, the operating performance maintained its high level and the Company over-fulfilled the budget targets. In 2018, the
Company achieved operating revenue of about RMB 2.79 billion yuan with a profit before tax of about RMB 780 million yuan, and a
net profit of RMB 593 million yuan. By the end of the year, the Company‘s assets were about RMB 5.82 billion yuan, the net assets
RMB 3.34 billion yuan. As its asset-liability ratio was only 42.6%, the financial status was proved stable and high-quality, and strong
in fending off risks. The return on net assets was about 18%, which was higher than the industry average.
Secondly, the land reserve bottleneck has been initially relieved. Focusing on the annual challenge of ―increasing the floor area of
500,000 square meters and the plot ratio-related construction are of 1 million square meters‖, the Company made great effort to
promote the expansion. In this year, special effort was made to propel various city-industry integration projects in Longhua Guanlan,
17
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Zhaoqing, Yangzhou and Chongqing. Up to now, the urban renewal project in Guanlan Bangling, covering an area of about 68,000
square meters with the plot ratio-related construction area of about 380,000 square meters and the total construction area of over
500,000 square meters, has completed various acquisitions.
Thirdly, the property management business mergers and acquisitions and the market expansion were carried out at the same
time to make great achievement. In 2018, the property management section newly expanded its area by more than 1.5 million
square meters, and 8 industrial park projects including Alibaba Hangzhou Riverside Industrial Park were successfully undertaken.
Meanwhile, the Company continuously expanded its industrial scale and completed the annual target of doubling the new area of
property management. Besides, the Group Company has officially announced the acquisition of 100% equity of TK Property. After
the successful acquisition, the Company will realize its nationwide operation and management layout with Baoding (Shenzhen)
Industrial Park in the north, Alibaba Hangzhou in the east, Shenzhen Bay Industrial Park in the south and JD in the west. By
promoting work in all areas by drawing upon the experience gained on key points, exerting the powerful demonstration effect, and
making progress in an all-round way, the overall strength of the Company‘s industrial park operation and management sector will be
further advanced, and is expected to rank among the top 3 in the national industry.
Fourthly, the housing asset management sector has taken firm steps. The Group‘s housing asset management Company operates
independently and actively explores the development model of ―long-term rental apartment + commercial offices‖, and strives to
develop various key demonstrative long-term rental apartment projects including ONE39 Building, Longhua Fengherili Complex,
Fumin New Village Complex and Xinhu Village. The Company will officially launch its ―Xi Apartments‖ brand for trial operation at
the end of the year.
(III) Features of Various Businesses Operated by the Company
1. The Real Estate Business Made Certain Progress Steadily
The Company‘s subsidiary has properly responded to the market changes, seized golden opportunities and made great achievement
through timely adjusting the sales strategy according to specific policies and market conditions. Shenzhen Huangcheng Real Estate
Co., Ltd. realized operating revenue of RMB 1.5 billion. In March 2018, Dongguan Songhu Langyuan Project was put on market
before other competitors‘ projects. Throughout the year, about 18,190 m2 were sold. By optimizing negotiation strategies and seizing
the opportunity, various shops with the difficulty in realization were all sold out. Xuzhou Company‘s operating revenue achieved
RMB 120 million. Besides, a full success was achieved in the main contracting settlement in relation with Xuzhou Phase I Project.
The commencement ceremony and subsequent construction of Xuzhou Phase II Project were also organized and held as scheduled;
Yangzhou Company realized the operating revenue of about RMB 650 million, smoothly fulfilling the annual objective.
2. The Accelerated Development of Property Management Business
The Company has made unremitting effort to develop its property management business, achieved remarkable results in the business
development, and continuously expanded its brand influence. Throughout the year, Shenzhen International Trade Center Property
Management Co., Ltd. developed 28 new projects in various cities including Chongqing, Shandong, Hangzhou and Shanghai with
the newly-added area of about 1.5 million square meters. Besides, it undertaken Aliyun Apsara Industrial Park, and integrated three
core industrial parks of Alibaba into its service scope, becoming the largest framework supplier of Alibaba in the world for its
integrated logistics support. Shenzhen International Trade Center Property Management Co., Ltd. realized the operating revenue of
RMB 420 million yuan with a year-on-year increase of about RMB 60 million yuan, exceeding about 110% of the annual budget.
Meanwhile, its total profit achieved about RMB 27 million yuan with the year-on-year increase of about RMB 2.5 million yuan.
Huangcheng Property Management Co., Ltd. realized the operating revenue of about RMB 65 million yuan, fulfilling about 110% of
the annual budget target.
3. Adjustment of House Rental Business
Relying on the headquarters‘ leasing center, the Company has founded the housing assets operation Company in charge of
readjusting the positioning of rental business and carrying out independent operation. The long-term rental apartment brand Xi
Apartments is owned by the housing assets operation Company, and corresponding preparation work was completed at the end of
December for its launching into the market. However, emphasis will be placed on launching three major long-term rental apartment
18
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
projects including ONE39 Building, Xinhu Village Apartment and Fengherili Complex.
(IV) Progress of Major Projects under Construction
1. SZPRD-Golden Collar’s Resort Project (Shenzhen): As interior and exterior decoration works are basically completed, it is in
the stage of preparing for various special acceptance inspections.
2. SZPRD-Qianhai Gangwan Project (Shenzhen): This project was successfully completed in December 2016.
3. SZPRD-Songhu Langyuan Project (Dongguan): This project was successfully completed in July 2017.
4. SZPRD-Fuhui Huayuan Project (Shenzhen): The project‘s planning permit and the foundation supporting construction permit
were obtained in early December, and it was officially commenced on December 29.
5. SZPRD-Hupan Yujing Project Phase I (Yangzhou): This project was completed and owners moved in it in June 2014.
6. SZPRD-Hupan Yujing Project Phase II (Yangzhou): This project‘s completion filing was completed in early November 2017,
and owners moved in it at the beginning of 2018.
7. SZPRD-Banshan Yujing Project Phase I (Xuzhou): Owners successfully moved into the project in the first half of 2017, and
houses are available for sale now.
8. SZPRD-Banshan Yujing Project Phase II (Xuzhou): The project‘s main contractor bidding was completed.
Details are described as follows:
Space
Space sold Space
Opening sold in The
Site Floor Sellable in Current
settled in
sellable Current Status quo of Time of Company’s
Project Location area area space Period（m2） Current
space Period project completion interest
（m2） （m2） （m2） (subscribed Period
（m2） （m2） (%)
for) （m2）
(signed)
Qianhai Nanshan 19,894 98,545 63,325 21,778 20,325 18,392 17,149 Completed October 100
Gangwan District, and 2016
Garden Shenzhen commercially
available
Yangzhou Weiyang 25,228 50,948 48,871 10,366 2,353 2,899 3,542 Completed June 2015 100
Hupan District, and
Yujing Yangzhou commercially
Phase I available
Yangzhou Weiyang 41,331 74,382 73,122 25,652 9,130 9,703 54,343 Completed November 100
Hupan District, and 2017
Yujing Yangzhou commercially
Phase II available
Xuzhou Tongshan 65,332 101605 85,653 17,163 11,297 10,972 79,785 Completed November 100
Banshan District, and 2016
Yujing Xuzhou commercially
Phase I available
Xuzhou Tongshan 31,537 34,956 21,839 ------- ------- ------- ------- Newly 100
Banshan District, commenced July 2020
Yujing Xuzhou and under
Phase II construction
19
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Songhu Dalang 66,882 207,459 140,911 20,718 18,373 18,190 15636 Completed 100
Langyuan Town, and July 2017
Dongguan commercially
available
Golden Futian 12,598 183,323 119,198 38,885 3,306 89 ------- Under March 2019 100
Collar’s District, construction
Resort Shenzhen
Apartment
Fuhui Futian 4,274 43,819 30,150 ------- ------- ------- ------- Newly December 100
Huayuan District, commenced 2021
Shenzhen and under
construction
Huiyang Huiyang 17,700 61,950 ------- ------- ------- ------- ------- In preparation Preliminary 100
Danshui District, for Preparation
Huizhou construction
Note: The space of the Yangzhou Hupan Yujing project includes the parking area.
(III) Properties for Rent
The Company’s interest
Type of property Space available for rent (m2) Annual revenue (RMB’0,000)
(%)
Shops and offices 61,406.20 100% 5,634.31
Plants 6,818.95 100% 634.16
Residential units 3,501.83 100% 176.10
Hotels 8,383.25 100% 430.42
Complexes 1,500.00 100% 86.25
Total 81,610.23 100% 6,961.24 (tax inclusive)
The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on Information Disclosure by Industry—for Listed
Companies Engaging in Real Estate.
See ―Part IV Operating Performance Discussion and Analysis‖, ―I Overview‖ herein.
II Core Business Analysis
1. Overview
See ―I Overview‖ above.
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
20
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2018 2017
As % of total As % of total
Change (%)
Operating revenue operating revenue Operating revenue operating revenue
(%) (%)
Total 2,787,240,632.53 100% 2,904,690,690.53 100% -4.04%
By operating division
Property
2,209,992,090.75 79.29% 2,340,233,648.93 80.57% -5.57%
development
Property rental 76,443,577.98 2.74% 79,236,389.91 2.73% -3.52%
Property
401,218,038.76 14.40% 344,226,703.95 11.85% 16.56%
management
Transport service 0.00% 48,573,142.33 1.67% -100.00%
Catering service 27,677,194.36 0.99% 30,898,120.01 1.06% -10.42%
Other 71,909,730.68 2.58% 61,522,685.40 2.12% 16.88%
By product category
Property
2,209,992,090.75 79.29% 2,340,233,648.93 80.57% -5.57%
development
Property rental 76,443,577.98 2.74% 79,236,389.91 2.73% -3.52%
Property
401,218,038.76 14.40% 344,226,703.95 11.85% 16.56%
management
Transport service 0.00% 48,573,142.33 1.67% -100.00%
Catering service 27,677,194.36 0.99% 30,898,120.01 1.06% -10.42%
Other 71,909,730.68 2.58% 61,522,685.40 2.12% 16.88%
By operating segment
Shenzhen city 1,696,976,389.71 60.88% 1,227,064,851.69 42.24% 38.30%
Dongguan city 252,401,699.77 9.06% 1,036,257,611.02 35.68% -75.64%
Other 837,862,543.05 30.06% 641,368,227.82 22.08% 30.64%
(2) Operating Division, Product Category or Operating Segment Contributing over 10% of Operating
Revenue or Operating Profit
√ Applicable □ Not applicable
Is the Company subject to any disclosure requirements for special industries?
Yes
Real Estate
Unit: RMB
21
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
YoY change in YoY change in
Operating Gross profit YoY change in
Cost of sales operating revenue gross profit
revenue margin cost of sales (%)
(%) margin (%)
By operating division
Real estate
2,209,992,090.75 844,658,618.92 61.78% -5.57% -28.59% 12.33%
development
Property
401,218,038.76 390,234,660.55 2.74% 16.56% 16.29% 0.22%
management
By product category
Real estate
2,209,992,090.75 844,658,618.92 61.78% -5.57% -28.59% 12.33%
development
Property
401,218,038.76 390,234,660.55 2.74% 16.56% 16.29% 0.22%
management
By operating segment
Core business data of the prior year restated according to the changed statistical caliber for the Reporting Period:
□ Applicable √ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
√ Yes □ No
Operating division Item Unit 2018 2017 Change (%)
Unit sales m2 60,245 73,537 -18.07%
Real estate
Output m2 262,098 338,090 -22.47%
development
Inventory m2 158,489 82,069 93.12%
Any over 30% YoY movements in the data above and why:
√ Applicable □ Not applicable
Inventory increased due to the real estate sector‘s periodic changes and the progress of project‘s development and construction.
(4) Execution Progress of Major Signed Sales Contracts in the Reporting Period
□ Applicable √ Not applicable
(5) Breakdown of Cost of Sales
By operating division
By operating division
Unit: RMB
Operating Item 2018 2017 Change (%)
22
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
division As % of total cost As % of total cost
Cost of sales Cost of sales
of sales (%) of sales (%)
Real estate
844,658,618.92 64.22% 1,182,884,514.58 72.66% -28.59%
development
Property rental 24,963,641.31 1.90% 22,951,930.77 1.41% 8.76%
Property
390,234,660.55 29.67% 335,567,577.69 20.61% 16.29%
management
Transport service 0.00% 29,669,816.38 1.82% -100.00%
Catering service 24,630,697.78 1.87% 26,763,583.26 1.64% -7.97%
Other 30,702,373.28 2.33% 30,030,482.96 1.84% 2.24%
Notes:
N/A.
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
The Company increased 2 subsidiaries to the consolidated scope as compared with last year. For details, see VIII. Changes in
Consolidated Scope in XI. Financial Statements of this Report.
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable √ Not applicable
(8) Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB) 235,744,668.00
Total sales to top five customers as % of total sales of the
10.56%
Reporting Period (%)
Total sales to related parties among top five customers
0.00%
as % of total sales of the Reporting Period (%)
Information about top five customers:
Sales revenue contributed for
No. Customer As % of total sales revenue (%)
the Reporting Period (RMB)
Property management center of Futitan
1 75,826,580.00 3.95%
District Government, Shenzhen
2 Alibaba (China) Co., Ltd. 74,090,411.00 3.32%
3 Dongguan Congze Trade Co., Ltd 62,554,040.00 2.80%
4 Natural person 1 11,667,429.00 0.52%
23
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
5 Natural person 2 11,606,208.00 0.52%
Total -- 235,744,668.00 10.56%
Other information about major customers:
□ Applicable √ Not applicable
Major suppliers:
Total purchases from top five suppliers (RMB) 76,383,439.00
Total purchases from top five suppliers as % of total
29.95%
purchases of the Reporting Period (%)
Total purchases from related parties among top five
suppliers as % of total purchases of the Reporting Period 0.00%
(%)
Information about top five suppliers:
Purchase in the Reporting
No. Supplier As % of total purchases (%)
Period (RMB)
The Second Construction Co., Ltd of
1 China Construction Third Engineering 44,571,765.00 17.47%
Bureau
Shanghai Reliance Environmental Service
2 9,988,320.00 3.92%
Co., Ltd
Zhejiang Ohant Comprehensive Service
3 7,928,898.00 3.11%
Co., Ltd
Shenzhen Design and Decoration
Engineering Co., Ltd/ Shenzhen Pinguan
4 7,686,667.00 3.01%
Construction Engineering Co., Ltd
(Combo)
Shenzhen Jianqiao Construction Group
5 6,207,789.00 2.43%
Co., Ltd
Total -- 76,383,439.00 29.95%
Other information about major suppliers:
□ Applicable √ Not applicable
3. Expense
Unit: RMB
2018 2017 Change (%) Reason for any significant change
Increases in commissions for sales
Selling expenses 46,501,225.18 31,179,193.33 49.14%
agents and advertising expenditure
Administrative expenses 102,852,213.19 137,028,655.69 -24.94% Equity transfer of two automobile
24
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
subsidiaries in the same period of last
year, and the enterprises included into
consolidated financial statements in
this year decreased and the legal costs
decreased.
Increase in interest revenue of bank
Finance costs -57,579,532.57 -24,407,456.38 135.91%
deposits
Income tax expenses 184,813,373.69 203,784,886.40 -9.31% Decrease in income
4. R&D Expense
□ Applicable √ Not applicable
5. Cash Flows
Unit: RMB
Item 2018 2017 Change (%)
Subtotal of cash generated from
2,746,158,558.76 1,337,537,854.19 105.31%
operating activities
Subtotal of cash used in
1,622,563,631.17 1,683,807,615.13 -3.64%
operating activities
Net cash generated from/used in
1,123,594,927.59 -346,269,760.94 424.49%
operating activities
Subtotal of cash generated from
80,016,759.11 68,062,071.40 17.56%
investing activities
Subtotal of cash used in
117,185,136.22 3,721,869.38 3,048.56%
investing activities
Net cash generated from/used in
-37,168,377.11 64,340,202.02 -157.77%
investing activities
Subtotal of cash generated from
3,450,000.00
financing activities
Subtotal of cash used in
178,793,727.60 107,246,594.16 66.71%
financing activities
Net cash generated from/used in
-175,343,727.60 -107,246,594.16 63.50%
financing activities
Net increase in cash and cash
911,088,034.88 -392,726,401.64 -331.99%
equivalents
Explanation of why any of the data above varies significantly:
√ Applicable □ Not applicable
Cash generated and net cash flows from operating activities increased from last year, primarily driven by the increase in house
25
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
payments received.
② Cash used and net cash flows from investing activities increased from last year, primarily driven by the increase of payments for
investment in the Reporting Period.
③ Cash used and net cash flows from financing activities increased from last year, primarily driven by the increase of cash bonus.
④ Net increase in cash and cash equivalents increased from last year, primarily driven by the increase in house payments received.
Reason for any big difference between the net operating cash flow and the net profit for this Reporting Period
√ Applicable □ Not applicable
For the Reporting Period, the net cash flows from operating activities stood at RMB1,123,594,927.59, representing a big difference
with the net income of RMB592,661,752.02, which was mainly because of the increased recoup funds of the projects of the
Company and the time difference between related taxes provisions and actual payment.
III Analysis of Non-Core Businesses
√ Applicable □ Not applicable
Unit: RMB
Amount As % of total profit Source/Reason Exceptional or recurrent
Exceptional (excluding income
Investment income of main
Investment income 1,889,021.11 0.24% of joint ventures of
joint ventures
RMB1268890.28)
Reversal of some valuation
allowances as a result of the
rising prices of the
Asset impairments -6,926,131.97 -0.89% Exceptional
Xuzhou-located Banshan
Yujing in the Reporting
Period
Non-operating Miscellaneous penalty
4,859,143.80 0.62% Exceptional
income income
Paying overdue fine and
Non-operating
3,040,842.92 0.39% compensation for removing Exceptional
expense
tenants
Asset disposal Disposal income of
-8,096.97 0.00% Exceptional
income Miscellaneous assets
IV Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB
31 December 2018 31 December 2017 Change in Reason for any significant change
26
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
As % of total As % of total percentag
Amount Amount
assets assets e (%)
3,389,234,357. 2,477,028,815. The increased sales recoup funds of the
Monetary capital 58.23% 45.93% 12.30%
72 21 projects
Increase in property management
Accounts
64,231,267.94 1.10% 46,272,600.86 0.86% 0.24% subsidiary‘s accounts receivable from
receivable
house owners
1,181,762,531. 1,850,672,044. Settlement of real estate project in
Inventories 20.30% 34.31% -14.01%
67 36 Reporting Period
Change in percentage was driven by
Investment 400,550,689.9 increased total assets, and decrease in
6.88% 426,849,558.05 7.91% -1.03%
property 0 value was because of depreciation
withdrawal
Long-term equity Increase of total assets at the
39,999,283.24 0.69% 38,730,392.96 0.72% -0.03%
investments period-end
Newly increased fixed assets in the
Fixed assets 32,612,592.40 0.56% 29,346,901.33 0.54% 0.02%
Reporting Period
Long-term Newly increased borrowings in the
1,000,000.00 0.02% 0.02%
borrowings Reporting Period
Deferred income 519,783,531.6
8.93% 388,022,097.64 7.19% 1.74% The increased deductible losses
tax assets 4
Other non-current 108,971,942.0
1.87% 0.00 1.87% Paying for the investment
assets 0
Advances from 265,338,215.3 Settlement of real estate project in
4.56% 516,984,711.11 9.59% -5.03%
customers 4 Reporting Period
Decrease of surplus of specific
Other non-current
52,937,180.81 0.91% 54,543,253.27 1.01% -0.10% maintenance funds of property
liabilities
management subsidiary
2. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Gain/loss on Cumulative
Impairment
fair-value fair-value Purchased in Sold in the
Beginning allowance for Ending
Item changes in the changes the Reporting Reporting
amount the Reporting amount
Reporting charged to Period Period
Period
Period equity
Financial assets
3. 3,591,209.20 30,171.91 3,621,381.11
27
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Available-for-sa
le financial
assets
Subtotal of
3,591,209.20 30,171.91 3,621,381.11
financial assets
Total of the
3,591,209.20 30,171.91 3,621,381.11
above
Financial
0.00 0.00
liabilities
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
3. Restricted Asset Rights as at the Period-End
The Company‘s subsidiary Dongguan ITC Changsheng Real Estate Development Co., Ltd. is a tentatively qualified real estate
development enterprise. During the application for the pre-sale permit for commodity houses, it is required to submit the commercial
housing quality guarantee letter after the bankruptcy and dissolution of the enterprise. After Dongguan ITC Real Estate Development
Co., Ltd. paid the deposit of RMB 12,402,160.00 to the Bank of Communications Dongguan Dalang Branch for issuing 9 irrevocable
commercial housing rental quality guarantee letters, of which, one letter was valued at RMB 1,468,870.00 with the valid guarantee
period from 30 June 2015 to 31 December 2020, and the remaining 8 letters RMB 10,933,290.00 from 1 July 2015 to 31 December
2020. As of 31 December 2018, the Company retrieved all original letters from the Land and Resources Bureau.
As a real estate developer, the Company provided purchasers of commercial residential building with mortgage guarantee and paid
cash deposits of loans according to the operation convention in real estate industry. As of 31 December 2018, the balance of cash
deposits not releasing guarantee was of RMB1,117,507.63, and the guarantee will be released when mortgage is paid off.
V Investments Made
1. Total Investment Amount
□ Applicable √ Not applicable
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□ Applicable √ Not applicable
28
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
4. Financial Investments
(1) Securities Investments
√ Applicable □ Not applicable
Unit: RMB
Gain/Lo
Accumu
ss on Source
lated
Account fair Purchas Gain/los
Variety Initial Beginni fair Sold in of
Code of Name of ing value ed in s in Ending Account
ng value Reporti
of investm measure changes Reporti Reporti carrying investm
security security carrying changes ng
ment in ng ng value ing title
security ent cost value charged Period ent
method Reporti Period Period
to
ng funds
equity
Period
Obtaine
Availabl
Gintian d in
Domesti Fair e-for-sal
400016, A, 3,565,8 3,591,2 30,171. 3,621,3 Gintian‘
c/Foreig value e
420016 Gintian 56.06 09.20 91 81.11 s debt
n stock method financia
B restructu
l asset
ring
3,565,8 3,591,2 30,171. 3,621,3
Total -- 0.00 0.00 0.00 0.00 -- --
56.06 09.20 91 81.11
Disclosure date of
announcement on Board‘s
consent for securities
investment
Disclosure date of
announcement on
shareholders‘ meeting‘s
consent for securities
investment (if any)
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
5. Use of Funds Raised
□ Applicable √ Not applicable
No such cases in the Reporting Period
29
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
VI Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable √ Not applicable
VII Major Subsidiaries
√ Applicable □ Not applicable
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10% effect on the Company‘s net profit:
Unit: RMB
Relationship Principal Registered Operating Operating
Name with the activity Total assets Net assets Net profit
capital revenue profit
Company
Shenzhen
Development
Huangcheng 30,000,000.0 1,246,825,73 162,179,009. 79,799,612.5
Subsidiary and sales of 3,101,585.73 2,657,622.33
Real Estate 0 0.89 56 9
real estate
Co., Ltd.
SZPRD
Xuzhou
Development
Dapeng Real 50,000,000.0 370,070,631. -109,480,636 122,209,577. 21,152,530.1 21,289,416.2
Subsidiary and sales of
Estate 0 55 .35 13 4 9
real estate
Development
Co., Ltd.
Dongguan
ITC
Development
Changsheng 20,000,000.0 447,597,292. 262,735,716. 247,296,018. 110,757,985. 80,762,210.8
Subsidiary and sales of
Real Estate 0 23 03 72 92 5
real estate
Development
Co., Ltd.
SZPRD
Yangzhou Development
347,048,899. 77,589,765.1 554,889,563. 87,465,303.7 75,603,493.9
Real Estate Subsidiary and sales of 50000000
87 1 08 1 3
Development real estate
Co., Ltd.
Shenzhen Property 469,980,871. 86,894,350.5 482,067,279. 32,701,494.8 23,923,135.2
Subsidiary 20000000
International management 08 0 18 8 7
30
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Trade Center
Property
Management
Co., Ltd.
Subsidiaries obtained or disposed in the Reporting Period:
√ Applicable □ Not applicable
How subsidiary was obtained or disposed Effects on overall operations and operating
Subsidiary
in the Reporting Period performance
Shangdong SZITC Hotels Managements Income was of RRMB 1.7278million, and
Newly established
co., Ltd net profit was of RMB -60,000
Income was of RMB0, and net profit
Yangzhou Slender West Lake Jingyue
Newly established attributable to the Company as the Parent
Property Development Co., Ltd
was of RMB -64,600
Information about major majority- and minority-owned subsidiaries:
VIII Structured Bodies Controlled by the Company
√ Applicable □ Not applicable
For details, see IX 1. Equity interests in subsidiaries in Section XI Financial Report herein.
IX Prospects
(I) Development Environment Analysis
Refer to "2. Analysis of Industry Pattern and Trend" in "Section IV: Discussion and Analysis of Business Situation"
(II) Company Development Situation in 2019
Compared with the uncertainties in material transition of team, insufficient land reserve, low team passion, etc., the internal and
external uncertainties faced by the group will be obviously reduced, and the directions and goals will be clearer in 2019. Through the
solid work and joint efforts of the group in 2018, the main orientation of the group's entrepreneurship has been established, and the
bottleneck of land reserve that restricts the sustainable development of the group has been initially alleviated. The orientation of the
main company and platform company of the investment control company has taken shape and gained initial recognition, and the
confidence to accelerate the reform and development of the group has been enhanced. At present, what we need to do is execute the
normal work of "sowing in spring and harvesting in autumn", concentrate on doing our own things well, highlight the two key
directions of incremental expansion and development, stock optimization and realization, maintain strategic determination, and
maintain the strategic determination, rhythm and intensity, keep working passion, accurately grasp the opportunity, dare to act to
ensure the completion of the target tasks throughout the year.
(III) Revision and Adjustment of the Company’s Future Development Strategy
As the traditional real estate market‘s development declines on the whole, various industrial resources have been continuously
occupied by the large-scale brand houses, which has threatened the survival and development of medium and small-sized property
companies. ―Large-scale Enterprises Taking All Advantages‖ has become normal in the industry, and the positioning of ―Houses are
for living in, not for speculating on‖ has already been established. In this case, Shenzhen Properties & Resources Development
(Group)Ltd. specialized in the traditional real estate will be confronted with the extremely severe industrial situation. In order to
implement the overall strategic layout formulated by Land and Resources Bureau of Shenzhen Municipality, the Company has made
31
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
great effort to seek effective breakthroughs, thoroughly connected with the system of Land and Resources Bureau, kept abreast of the
major strategic orientation featuring gradient of layers and multiple industrial parks in one district and combined fund control, and
learned from the leading enterprises in the benchmarking industry. By means of strategic thinking, analysis & conclusion and
research & demonstration in 2018, the Company accordingly revised and adjusted its 13 th five-year strategic plan, and put forward
the development vision of ―Becoming Top 1 Intelligent Technology Industrial Park Full Eco-chain Integrated Operator in China and
even Leading the World‖. Through following the overwhelming trend of the real estate market from the age of increments to the age
of stocks and seizing the golden opportunity posed by the transformation of the social major contradiction, the Company has attached
great importance to the key points of stock assets‘ value management and industrial and ecological operation services, propelled the
high-quality development based on new development ideas and satisfied people‘s longings for better life.
In this context, the Company put forward the ―12345‖ overall development idea of ―1 Vision + 2 Major Sectors + 3 Driving Factors
+ 4 Businesses + 5 Value-added Services‖. In other words, the Company will take effective measures with the focus on ―Hi-tech
Industrial Park‖ and ―Resident Community‖, and relying on the driving innovation power, the leverage of capital and the platform
linkage mechanism as the inexhaustible motive force for development, pay special attention to develop four major businesses through
expanding the main business and making breakthroughs including the urban space development, the industrial ecological operation,
property management services, and high-end value-added services. Meanwhile, the Company will realize the rapid deployment and
integration of five major value-added services including financial services, life health, pension services, education services, and AI +
services.
The Company will moderately deploy the high-quality heavy-asset operating properties, and the highly market-operated light-assets
operating properties, and simultaneously carry out the heavy-assets operation and the light-assets operation with the priority given to
the light-assets operation, highlighting the asset value management capability, the industrial ecological operational capability and the
channel resources platform integration capability; the Company will also strengthen the driving role played by the strategic objective,
establish the humanistic thought, broaden the horizon of human resources allocation, build and improve the mechanism and
proportion of all employees to share various development results, and strive to shape a beautiful life scene. In 2025, the Company
will make its four business segments advance side by side, complement each other, realize the coordinated development, catch up
with and surpass the world‘s advanced level. With strong comprehensive strength and unique brand advantages, it will become Top 1
Intelligent Technology Industrial Park Full Eco-chain Integrated Operator in China and even Leading the World, and further promote
the core competitiveness of Shenzhen.
(IV) Major Works and Tasks for 2019
We should do a good job in the guiding ideology for the group's work in 2019: Guided by Xi Jinping Thought on Socialism with
Chinese Characteristics for a New Era, we should implement and carry out the important speech spirit that General Secretary Xi
Jinping visited Guangdong, grasp the major opportunity of Shenzhen State-owned Enterprises in the new round of large-scale reform
and integration taking the opportunity of the Municipal SASAC to promote the "Regional State-owned Enterprises Comprehensive
Reform Experimental Zone", coordinate with the investment control company to be selected into "Double Hundred Action" for the
reform of state-owned enterprises, and create a municipal science and technology control platform and Benchmarking Temasek and
other key strategies; Positioned in the main company and platform company of investment control system, we should make efforts
and concentrate efforts to fight against "sales payback, project construction landing and capital operation", continue to vigorously
promote a multi-level incentive mechanism, vigorously select and train young talents, vigorously enhance the capacity and level of
the group's modern enterprise system construction, and enhance the sense of modernity, vitality and awareness of the group's
governance image, continue to promote the building of a clean and honest party style and the implementation of the "two
responsibilities"; We should advocate for practical work, support practical work, reward practical work, be honest in starting a
business, strengthen confidence, maintain determination, and comprehensively embark on a new journey of building China's first and
leading integrated operator of the whole ecological chain of intelligent science and technology parks in the world, and go all out to
accomplish the goals and tasks of 2019.
Firstly, the Company shall seize the opportunity and take the initiative to occupy three heavily-fortified positions,
32
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
continuously reinforce its development potentials and firmly promote the group’s high-quality development. Strictly adhering
to the functional orientation of establishing the main Company and the platform Company, the Company will accordingly take the
initiative to occupy three heavily-fortified positions in relation Sales Outstanding, Commencement of Project Construction and
Capital Operation, and flexibly apply various marketing methods to guarantee the full completion of sales of Golden Collar Project.
In the year, the returned funds from various projects shall be guaranteed at RMB 4,000 million and even at RMB 5,000 million. In
the year 2019, 1 or 2 city-industry integration project(s) will be implemented in Shenzhen with the total construction area no less than
300,000 square meters. Besides, if possible, various city-industry integration projects will also be carried out in Zhaoqing, Yangzhou
and Chongqing, and it is estimated that the total newly-added land reserves would be no less than 500mu (1,000mu at most).
Regarding the hi-end hi-tech industrial parks, office buildings, commercial buildings, cultural tourism and municipal engineering as
key points, the Company will expand the property management area no less than 10 million square meters by means of mergers and
acquisitions. By occupying three heavily-fortified positions, the Company‘s development potentials will be further enhanced. In
addition, the Company will continuously optimize its business development structure, improve its business development quality,
strive to realize the high-quality foundation, operation level and development potentials, and firmly drive the Company‘s high-quality
growth.
Secondly, the Company will spare no effort to guarantee the fulfillment of annual business target. Based on the comprehensive
budget, the Company will effectively implement the budget plan, figure out various in-depth potential factors and formulate the
operating budget for the year 2019 in a scientific and reasonable way, complete various budget objectives, carry out strict assessment
work and properly implement the supervision and inspection. Various branches not involved in the real estate are required to increase
the income and reduce the expenditure, save the cost and improve the efficiency, contributing to the increase of operating profits of
the group. Meanwhile, great effort shall also be made to promote the project marketing, adjust various marketing strategies based on
the market changes, flexibly make use of different marketing methods and master various key opportunities. The early sales, quick
sales and large sales strategy must be firmly implemented for Qianhai Gangwan Garden Project and Dongguan Songhu Langyuan
Project so as to sell out all houses, realize the goal of selling up all houses in Block B of Golden Collar‘s Resort Apartment and the
cash sales of Block C, accelerate the return of capital and strengthen the collection of accounts receivables.
Thirdly, the Company shall stick to the development strategy of externally expanding its property management business,
realize its large-scale expansion, enhance its core competitiveness and expand the brand influence. By learning from the
leading enterprise within the bench-marking industry, the Company will seek ways for expanding its property management business
to the overseas market, and facilitate the Company to transform from the supplier of traditional property management services to the
supplier of internationalized and modernized comprehensive social services. Regarding high-end high-tech industrial parks, cultural
tourism, municipal engineering and medium and high-end residence communities as key points, the Company will realize its
large-scale expansion by means of merges and acquisitions and the establishment of industrial acquisition fund, emphasize the
improvement of various competitive advantages in the field of industrial parks, continuously improve the service innovation ability,
form the unique brand influence and core competitiveness, enhance the introduction and training of core property management cadres
and talents, and establish the talent base for its rapid expansion. In this year, the Company shall try its best to make the expanded
property management area no less than 10 million square meters and the self-developed area no less than 1 million square meters.
Fourthly, the Company shall introduce the brand strategy, improve the business scale and make full use of the operating
efficiency of the leasing assets. From three major perspectives such as the reform, the transformation and the sustainable
development, the Company will proceed from the increment expansion, the transformation of stocks and the quality and efficiency
improvement to realize the comprehensive operation of five long-term rental apartment stores including Longhua Complex, ONE39
Building, Xinhu Village, Fumin Complex and Chuanbu Street Phase I, and the food court in the ITC Plaza. In addition, it is expected
to add the rental income about RMB 10 million Yuan and the total revenue about RMB 80 million Yuan, straighten out and perfect
various management works related to the rental operation Company, comprehensively strengthen the business operation and
management capability, introduce the brand strategy and improve the business scale.
Fifthly, the Company will insist on the comprehensive deepening of the reform, further optimize the system, define the
33
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
power-responsibility system, firmly implement the system and strengthen the development momentum. The Company must
respect the laws of the market, optimize the rational allocation of resources, and effectively establish a mechanism for sharing
benefits. Meanwhile, it is required to strengthen the market-oriented management in the business areas of group real estate, property
management, and long-term rental apartments etc., improve the decision-making efficiency and level, rationally allocate resources
according to the rules of market value, provide all necessary support, and ensure the unification of ―efficiency, benefits and effects‖.
At the same time, the Company will strive to complete the Group‘s internal remuneration reform plan, and implement various
incentive and restraint systems including the real estate project investment system, fully introduce the incremental sharing
mechanism, strengthen the assessment, lay the common material benefits foundation for all members‘ fulfillment of core values such
as Concentric Effort, Co-creation and Sharing, and guarantee the long-term, stable and sustainable development of the Group.
In the sixth step, the Company shall focus on the new mission for its development, continuously strengthen its basic
management ability, firmly hold on to “six improvements” and help the Group become the first-class enterprise in this
industry. First, the Company must pay close attention to the promotion of corporate brand culture, promote the group brand building
and the re-thinking of corporate culture, form a consistent brand strategy and cultural identity; second, it must pay close attention to
the management and control process, comprehensively sort out the group‘s management process, operation mechanism and
authorization system so as to realize the business process optimization and re-engineering, cooperate with the process management,
simultaneously promote the optimization and integration of the Group‘s OA system, and formulate and introduce the Group‘s
five-year informationization plan; third, the Company must focus on the standardization of products and services, actively promote
the standardization of the Group‘s real estate, leasing and property management products and services, form various advantages
related to the systemization, branding and standardization, and establish the service standards geared to Shenzhen Bay Park; it is also
required to strengthen the construction of technology centers, and initially establish the Group‘s innovation platform to significantly
promote the Group‘s overall technological innovation capability; fourth, the Company must attach great importance to the financial
management and control improvement, officially operate the Group‘s fund settlement center within the year in accordance with the
Group‘s management objectives and operational requirements of ―one network, one table, one process and one pool‖ so as to realize
the centralized management of the entire Group‘s funds, simultaneously explore and establish the financial sharing center model, and
fully play the primary and driving role of the financial management and control in the group management and control; fifth, the
Company must make great effort to improve the standardization of safety production, complete the construction of the safety
production standardization system, carry out various mechanisms such as the founding of institution, the personnel allocation,
implementation of benefits, and realization of rewards and punishments etc. and fully take the enterprise‘s main responsibilities for
safety production. Finally, emphasis must be placed on the improvement of the Group‘s comprehensive risk management and control
system, especially the strengthening of the construction of the top-level design and basic norm system in relation to the group-level
policy compliance risks, integrity prevention and control risks and investment decision-making risks. Further, it is required to
re-organize and pre-judge historical stock litigation cases, propose the overall solutions, and resolutely prevent possible subversive
risks.
In the seventh step, the Company shall take the party construction as the guide and continuously strengthen the construction
of party organization. In this case, it is required to complete the construction of the reform and opening-up exhibition hall on the
nd
42 floor of the ITC Building and open it to the outside world, fully demonstrate the profound historical heritage of the Group, write
the story of spring in the spirit of ―International Trade Center‖, and reshape the SZPRD‘s brand image of ―Dare to be the First and
Become Stronger through Reform‖; the Company will also follow the correct political orientation, obey the overall service situation,
highlight the problem orientation, uphold the strict, careful, and practical work style, strictly implement the overall responsibility of
strictly administering the party, give full play to the role of discipline building in addressing both symptoms and root causes,
guarantee the actual implementation of the party‘s line, principles, policies, and major decisions, fully play the political core role and
the vanguard and exemplary role of the party organization.
(V) Analysis of the Company’s Possible Risks
1. Market-related Risks
34
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
There exists a great correlation between the real estate industry and the macro economy. The Company‘s income mainly comes from
real estate development, which is greatly affected by the macroeconomic development cycle. Generally, in the rising stage of the
macroeconomic cycle, the investment prospects and market demand of the real estate industry will be optimistic, and the real estate
prices and transaction volume will rise; on the contrary, market demand will shrink, and the real estate prices and trading volume will
fall accordingly with increased operating risks and declined income on investment. In addition, the real estate industry is highly
correlated with the overall operation of the national economy, and as a typical industry largely depending on various resources, it is
greatly affected by the government‘s macroeconomic policies. Since the third quarter of 2016, the central government has proposed
that ―houses are for living in, not for speculating on‖, and various provinces and municipalities have successively introduced
restrictions on purchases, limits on loans and related financial regulation policies to guide and promote the sustainable, stable and
healthy development of the real estate industry, which will have a direct impact on the operation and development of real estate
development enterprises. Therefore, whether the Company can adjust its business strategy and investment behavior in a timely
manner in response to the change in the industry cycle and the adjustment of industrial policies will greatly affect the Company‘s
performance.
2. Land Reserve Risk
The Company‘s lack of land reserves and insufficient development stamina still exists. In the current favorable situation for sales of
real estate projects and the Company‘s funds, various resources for land investment will be increased in the future. In addition to the
emphasis placed on the target city‘s land bidding and auction information, it will also strengthen the study on other cooperative
development modes including M&A so as to replenish land reserves as soon as possible.
3. Financing Risk
In the process of actively increasing land reserves and accelerating the business development, the Company needs to invest a large
amount of funds for land acquisition and project development. In addition to its own funds, the Company‘s project development
funds need to be externally financed through bank loans and issuing securities. If the country‘s macroeconomic situation, credit
policy and capital market undergo major changes or adjustments, it may lead to restrictions on the Company‘s financing or the
Company‘s financing costs, which will adversely affect the Company‘s production and operation.
The above business plan and business objectives do not represent the listed Company’s profit forecast for 2019. Whether it
can be achieved depends on various factors including changes in market conditions and the effort made by the management
team. Investors must pay special attention to that because there exists huge uncertainty.
X Communications with the Investment Community such as Researches, Inquiries and
Interviews
1. During the Reporting Period
√ Applicable □ Not applicable
Type of communication Index to main information
Date Way of communication
party communicated
Inquired of relevant questions about
strategic cooperation of the Company
11 January 2018 By phone Individual
with CASTD, and the future
development of the Company
Inquired of the forecast of annual report
31 January 2018 By phone Individual
of the Company
31 January 2018 By phone Individual Inquired of the basic information and
35
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
trend of stock prices of the Company
Inquired of the operation conditions and
1 February 2018 By phone Individual
trend of stock prices of the Company
Inquired of the trend of stock prices of
7 February 2018 By phone Individual
the Company
Inquired of the performance of thee
9 April 2018 By phone Individual
Company this year
Inquired of the forecast reduction in first
12 April 2018 By phone Individual
quarter of the Company
Inquired of the development of
19 April 2018 By phone Individual long-term rental apartment of the
Company
Inquired of the development of
23 April 2018 By phone Individual long-term rental apartment of the
Company
Inquired of the performance of the
Company, forecast reduction of
10 October 2018 By phone Individual
performance in third quarter of the
Company
Inquired of the forecast reduction of
10 October 2018 By phone Individual performance in third quarter of the
Company
Inquired of the reasons for falling stock
17 October 2018 By phone Individual
prices of the Company
Inquired of the reasons for falling stock
18 October 2018 By phone Individual
prices of the Company
Inquired of the reasons for falling stock
18 October 2018 By phone Individual
prices of the Company
Inquired of the current operation
7 November 2018 By phone Individual conditions of the Company and the
opening of Golden Collar Project
Inquired of the current operation
7 November 2018 By phone Individual conditions of the Company and the
opening of Golden Collar Project
Inquired of the acquisition of TK
14 December 2018 By phone Individual
Property
Inquired of the acquisition of TK
18 December 2018 By phone Individual
Property
Times of communications 18
36
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Number of institutions communicated with 0
Number of individuals communicated with 18
Number of other communication parties 0
Tip-offs or leakages of substantial
supposedly-confidential information during None
communications
37
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part V Significant Events
I Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)
How the profit distribution policy, especially the cash dividend policy, for ordinary shareholders was formulated, executed or revised
in the Reporting Period:
□ Applicable √ Not applicable
The profit distributions to ordinary shareholders, either in the form of cash or stock, in the past three years (including the Reporting
Period) are summarized as follows:
Year Profit distributions (in the form of cash or stock)
2018 A cash dividend of RMB3.00 (tax included) per 10 shares and no share capital increase from capital
reserve
2017 A cash dividend of RMB1.80 (tax included) per 10 shares and no share capital increase from capital
reserve
2016 A cash dividend of RMB0.80 (tax included) per 10 shares and no share capital increase from capital
reserve
Cash dividend for ordinary shareholders in the past three years (including the Reporting Period):
Unit: RMB
Net profit
attributable to
ordinary Total cash
Cash shareholders Cash dividends dividends
A as % of B in other forms C as % of B D as % of B
Year dividends (tax of the listed (including
(%) (such as share (%) (%)
inclusive) (A) company in repurchase) (C) those in other
consolidated forms) (D)
statements for
the year (B)
2018 178,793,727.60 592,723,852.71 30.16% 0.00 0.00% 178,793,727.60 30.16%
2017 178,793,727.60 622,962,734.37 28.70% 0.00 0.00% 178,793,727.60 28.70%
2016 107,276,236.56 354,857,241.74 30.23% 0.00 0.00% 107,276,236.56 30.23%
Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for the ordinary shareholders despite the
facts that the Company has made profits in the Reporting Period and the profits of the Company as the parent distributable to the
ordinary shareholders are positive.
□ Applicable √ Not applicable
38
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
II Final Dividend Plan for the Reporting Period
√ Applicable □ Not applicable
Bonus shares for every 10 shares (share) 0
Dividend for every 10 shares (RMB) (tax inclusive) 3.00
Additional shares to be converted from capital
0
reserve for every 10 shares (share)
Total shares as the basis for the profit distribution 595,979,092.00
proposal (share)
Cash dividends (RMB) (tax inclusive) 178,793,727.60
Cash dividends in other forms (such as share
0.00
repurchase) (RMB)
Total cash dividends (including those in other
178,793,727.60
forms) (RMB)
Distributable profit (RMB) 2,080,513,737.62
Total cash dividends (including those in other
100%
forms) as % of total profit distribution
Cash dividend policy
If the Company is in a mature development stage and has no plans for any significant expenditure, in profit allocation, the ratio of
cash dividends in the profit allocation shall be 80% or above.
Details about the proposal for profit distribution and converting capital reserve into share capital
According to the Company‘s Articles of Association as well as the actual situation of its development and operation, the proposal of
the Company for 2018 annual profit distribution is as follows: Based on the total 595,979,092 shares of the Company as at 31
December 2018, a cash dividend of RMB3.00 (tax included) will be distributed to all its shareholders for every 10 shares they hold,
with the total cash dividends to be distributed amounting to RMB178,793,727.60. And the retained profits will be carried over for
distribution in the future. No capital reserves will be turned into share capital for 2018.
III Fulfillment of Commitments
1. Commitments of the Company’s Actual Controller, Shareholders, Related Parties and Acquirers, as well
as the Company Itself and other Entities Fulfilled in the Reporting Period or Ongoing at the Period-end
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Where there had been an earnings forecast for an asset or project and the Reporting Period was still
within the forecast period, explain why the forecast has been reached for the Reporting Period.
□Applicable √ Not applicable
39
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
IV Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
V Explanations Given by the Board of Directors, the Supervisory Board and the Independent
Directors (if any) Regarding the Independent Auditor's “Modified Opinion” on the Financial
Statements of the Reporting Period
□ Applicable √ Not applicable
VI YoY Changes to Accounting Policies, Estimates and Methods
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VII Retrospective Restatements due to Correction of Material Accounting Errors in the
Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VIII YoY Changes to the Scope of the Consolidated Financial Statements
√ Applicable □ Not applicable
For the detailed changes to the Company‘s consolidated statements of the Reporting Period, see ―Part XI Financial Statements‖, VIII.
IX Engagement and Disengagement of Independent Auditor
Current independent auditor:
Name of the domestic independent auditor Ruihua Certified Public Accountants (LLP)
The Company‘s payment to the domestic independent auditor
63
(RMB‘0,000)
How many consecutive years the domestic independent auditor
1
has provided audit service for the Company
Names of the certified public accountants from the domestic
Cai Xiaodong and Wang Huansen
independent auditor writing signatures on the auditor‘s report
How many consecutive years the certified public accountants
1
have provided audit service for the Company
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.
40
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
√ Yes □ No
Indicate by tick mark whether the independent auditor was changed during the audit period.
□ Yes √ No
Indicate by tick mark whether an approval procedure was implemented for the change of independent auditor.
√ Yes □ No
Further details about the change of independent auditor:
The Company‘s original audit institution, Mazars Certified Public Accountants (SGP) (hereinafter referred to as ―Mazars CPA‖)
adhered to the principle of independent audit in the course of practicing, and reflected the financial status of the Company in an
objective, fair and impartial way, earnestly fulfilled their due responsibilities, and effectively safeguarded the legitimate rights and
interests of the Company and its shareholders from a professional perspective.
As the employment of Mazars CPA has expired and the audit team serving the Company has provided audit services for the Company
for more than 15 consecutive years, according to relevant regulations of China Securities Regulatory Commission and State-Owned
Assets Supervision Administration of Shenzhen Municipality, in order to ensure the independence and objectiveness of the
Company‘s audit work, and comprehensively take into account the needs of the Company‘s business development and future audits,
the Company held the annual meeting of board of directors and shareholders‘ meeting respectively on 29 March 2018 and 15 June
2018, and hired Ruihua Certified Public Accountants (special general partnership) as the Company‘s annual financial statements and
the internal control auditing agency at the cost of RMB 850,000. The proposal has been approved by the board of directors and the
shareholders meeting respectively.
Independent auditor, financial advisor or sponsor engaged for the audit of internal controls:
√ Applicable □ Not applicable
In this Reporting Period, the Company engaged Ruihua Certified Public Accountants (LLP) for its internal control audit and paid an
internal control audit fee of RMB220,000 to it for the year.
X Possibility of Listing Suspension or Termination after Disclosure of this Report
□ Applicable √ Not applicable
XI Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XII Major Legal Matters
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIII Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.
41
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
XIV Credit Quality of the Company as well as Its Controlling Shareholder and Actual
Controller
□ Applicable √ Not applicable
XV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures
for Employees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVI Major Related-Party Transactions
1. Continuing Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Related Transactions Regarding Joint Investments in Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Credits and Liabilities with Related Parties
√Applicable □ Not applicable
Indicate by tick mark whether there were any credits and liabilities with related parties for non-operating purposes.
√ Yes □ No
Receivable from related parties
Capital Amount
Amount
occupation Beginning newly Ending
Relationshi received in Current
added in
Related for balance current interest balance
p with the Reason current Interest rate (RMB‘0,00
period
party non-operati (RMB‘0,00 period
(RMB‘0,00 0) (RMB‘0,000
Company (RMB‘0,00
ng purposes 0) 0) )
0)
(yes/no)
42
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Anhui 30%
Business
Nanpeng equities
circulating No 813 813
Papermakin held by the
funds
g Co., Ltd. Company
Shenzhen
Wufang 26%
Business
Pottery & equities
circulating No 175 175
Porcelain held by the
funds
Industrial Company
Co., Ltd.
Influence on the
Company‘s operating All were within the risks control of the Company and not influenced the operating results and the
results and financial financial conditions.
condition
Liabilities payable to related parties
Amount Amount
Beginning newly added returned in Current
Relation with Formation
Related party balance in current current Interest rate interest Ending
the Company reason
(RMB‘0,000) period period (RMB‘0,000) balance(RMB
(RMB‘0,000) (RMB‘0,000) ‘0,000)
Shenzhen Jifa
Intercourse
Warehouse Joint venture 2,630 2,630
funds
Co., Ltd.
Shenzhen
Tian‘an
International
Intercourse
Building Joint venture 521 521
funds
Property
Management
Co., Ltd.
Influence on the Company‘s
Were all within the risks control of the Company and not influenced the operating results and the
operating results and
financial conditions.
financial condition
5. Other Major Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.
43
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
XVII Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major guarantees
√ Applicable □ Not applicable
(1) Guarantees
Unit: RMB'0,000
Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)
Disclosure
Guarante
date of the
Actual Having e for a
guarantee Line of Actual Type of Term of
Obligor guarantee expired related
line guarantee occurrence date guarantee guarantee
amount or not party or
announcem
not
ent
Guarantees provided by the Company as the parent for its subsidiaries
Disclosure
Guarante
date of the
Actual Having e for a
guarantee Line of Actual Type of Term of
Obligor guarantee expired or related
line guarantee occurrence date guarantee guarantee
amount not party or
announcem
not
ent
Shenzhen 20 July 2018
29 March General
Huangcheng Real 75,000 20 July 2018 100 to 20 June No Yes
2018 guaranty
Estate Co., Ltd. 2021
44
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total approved line for such Total actual amount of such
guarantees in the Reporting Period 75,000 guarantees in the Reporting 100
(B1) Period (B2)
Total approved line for such Total actual balance of such
guarantees at the end of the 75,000 guarantees at the end of the 100
Reporting Period (B3) Reporting Period (B4)
Guarantees provided between subsidiaries
Disclosure
Guarante
date of the
Actual Having e for a
guarantee Line of Actual Type of Term of
Obligor guarantee expired related
line guarantee occurrence date guarantee guarantee
amount or not party or
announcem
not
ent
Total guarantee amount (total of the three kinds of guarantees above)
Total actual guarantee
Total guarantee line approved in
75,000 amount in the Reporting 100
the Reporting Period (A1+B1+C1)
Period (A2+B2+C2)
Total actual guarantee
Total approved guarantee line at
balance at the end of the
the end of the Reporting Period 75,000 100
Reporting Period
(A3+B3+C3)
(A4+B4+C4)
Total actual guarantee amount (A4+B4+C4) as % of the
0.03%
Company‘s net assets
Of which:
Balance of debt guarantees provided directly or indirectly for
100
obligors with an over 70% debt/asset ratio (E)
Total of the three amounts above (D+E+F) 100
Compound guarantees:
(2) Irregularities in Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
□ Applicable √ Not applicable
45
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
No such cases in the Reporting Period.
(2) Entrusted Loans
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVIII Corporate Social Responsibility (CSR)
Since its inception, SZPRD has been adhering to the concept of honesty, responsibility and win-win cooperation for the benefit of
society. The Company actively fulfills its social responsibilities and always takes repaying the society as an important development
concept. It actively fulfills its statutory social responsibilities and ethical social obligations, and unifies the realization of economic
and social benefits to create an excellent corporate image. The Company carried out the following activities to perform its social
responsibility in 2018:
I. Actively Carry out the Volunteer Service Activities
At the end of August, the Group actively responded to the call of Shenzhen Investment Holding Co., Ltd. to undertake the theme
activity for public benefits of ―Love & Support for People‘s Livelihood 1+1‖. For this activity, it was responsible for the organization
and publicity of the event, and for advocating the spirit of volunteer service of ―dedication, friendship, mutual assistance and
progress‖, helping the poor and tackling the difficulties and supporting the Shenzhen blood bank. During the activity, the Group
successfully finished corresponding organization and publicity work. Meanwhile, 37 enterprises directly under the control of
Shenzhen Investment Holding Co., Ltd. actively responded, and 415 people participated in the blood donation activity. The
accumulated blood donation volume was 135,450 ml, and the whole system donated 17,239 pieces of clothing to various
poverty-stricken areas in Kashgar, Xinjiang, strongly demonstrating that various state-owned enterprises in Shenzhen could earnestly
fulfill their social responsibilities.
II. Actively Organize and Conduct the Voluntary Blood Donation Activity
In order to commemorate the 97th anniversary of the founding of the Communist Party of China, cherish the history of the party, and
carry forward the fine traditions of the party, on 27 June 2018, the party committee of Shenzhen International Trade Center Property
Management Co., Ltd. subordinated to SZPRD together with the Jiabei Community Station of Nanhu Sub-district in Luohu District
held the activity of ―Red Banner & Red Action‖ Voluntary Blood Donation, attracting a total of 96 people to voluntarily donate their
blood on the day with the total amount of blood donation 34,750 ml. In fact, the number of people involving the blood donation and
the donated blood volume all exceeded that in previous years. Since 2011, the party committee of Shenzhen International Trade
Center Property Management Co., Ltd. has insisted on carrying out the theme activity for public benefits of ―Red Banner & Red
Action‖ to commemorate the party‘s birthday every year, allowing party member volunteers to play an exemplary role. Fortunately,
the activity has attracted the active response from the owners and tenants of ITC Building, various party organizations in the southern
business district and Jiabei Community station and people from all walks of life, and become a unique party building activity
featuring ―the secretary controls the activity, the party branch creates the brand, and the party members strive for becoming the
vanguard‖. In terms of this activity, more than 550 people have donated their blood voluntarily with the total unpaid blood donation
volume exceeding 180,000 ml.
To celebrate the 40th anniversary of China‘s reform and opening up, Huangcheng Property Management Co., Ltd. under the control of
46
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
SZPRD jointly sponsored the large-scale voluntary blood donation activity ―Donate for Life‖ in the Huangyuyuan Residence
Community with Shenzhen Blood Center, Red Cross Society of China Shenzhen Branch, Shenzhen Port Community Party
Committee, Shenzhen TV Entertainment Life Channel, and Shenzhen Xuezhiyuan Commonweal Foundation from August 24 to
August 25. In two days, the number of good-hearted people participating in the blood donation reached 129, the actual number
reached 114, and the total amount of blood donation reached 42,900 ml.
III. Care for Employees and Advocate Good Morals
Examples for Care for Employees: In the afternoon of February 8, Liu Shengxiang, the secretary of the party committee &
Chairman of SZPRD, Wei Xiaodong, the deputy secretary of the party committee and the secretary of the Discipline Inspection
Commission, Liu Guangxin, the chairman of the labor union, and the deputy general manager CaiLili and Zhang Gejian visited and
comforted 5 employees suffering from diseases or needing take care of sick family members that were working for three affiliated
companies under the Company‘s direct control, and costed RMB 11,190 by sending them consolation money, gifts and best wishes
for the new year. In the afternoon of March 6, the Female Working Committee of SZPRD invited the lecturer of the Workers‘
Cultural Lecture Hall of Municipal Federation of Trade Unions, the member of IHNMA in Shenzhen, the director of Shenzhen
Health Care Association, the TCM health teacher, and the international hypnosis teacher Chen Weiling to hold the public lecture on
―Life Cultivation and Health Preservation in Four Seasons‖ as a special gift for female employees on March 8. As a matter of fact,
more than 60 female employees from the headquarters and subordinated grassroots trade unions attended the lecture.
The Deeds of Returning Lost Money. In the afternoon of May 16, He Rui, any employee of Shenzhen Huangcheng Property
Management Co., Ltd. under the control of SZPRD, picked up HKD25,000 in cash on his way to the employee‘s canteen. In order to
find the owner, he waited in situ for about 10 minutes, but no one came to claim the money. Then, He Rui immediately reported such
situation to the Company, and sent the money to Fuqiang Police Station. After he came back to the Company, he finally knew the
owner‘s identity by means of checking videos and various investigations, and then found the owner and claimed back the money
from Fuqiang Police Station.
IV. Social Honors Obtained
1. On March 21, the list of 2018 China‘s Top 500 Real Estate Development Enterprises jointly appraised and elected by CREA,
E-house China R&D Institute, China Real Estate Appraisal Center was announced and revealed to the public, and SZPRD ranked
among them. Actually, it‘s the 8th time for SZPRD to rank among them.
2. On June 1, China Index Research Academy and China Real Estate TOP10 Research Group held ―2018 China Property Service Top
100 Research Results Release Conference‖, announcing the list of ―Top 100 Property Service Enterprises in China‖. By virtue of its
outstanding comprehensive strength and service management level, Shenzhen International Trade Center Property Management Co.,
Ltd. under the control of SZPRD ranked 35th among ―2018 China Property Service Top 100 Enterprises‖, and won various titles such
as ―China Property Service Top 100 Enterprises (from 2016 to 2018)‖ and ―2018 China Industrial Park Property Management
Leading Enterprise‖ etc.
3. Guangdong Provincial Enterprises Confederation, Guangdong Provincial Association of Entrepreneurs jointly held ―2018
Guangdong Enterprises Top 500 & Excellent Independent Brands Release Conference", announcing the list of Top 500 Enterprises in
Guangdong Province. By virtue of its remarkable performance in operating the real estate development and property management
business, SZPRD was awarded the title of ―Top 500 Enterprises in Guangdong Province in 2018‖. In fact, the Group won the title of
―Top 500 Enterprises in Guangdong Province in 2017‖for the 8th time.
4. On December 14, Shenzhen Printing Industry Association held ―2018 Internal Publication Media Awards Presentation Ceremony
of Shenzhen Enterprise Internal Publications‖, announcing the winners of Shenzhen Excellent Internal Publication Media Awards.
The internal publication of ITC Window of SZPRD won ―2018 Shenzhen Excellent Internal Publication Media Award‖. Since 2009,
ITC Window has won this award for ten consecutive years.
47
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2. Measures Taken for Targeted Poverty Alleviation
The Company didn‘t take any targeted measures to help people lift themselves out of poverty during the Reporting Period, no
targeted poverty alleviation plan temporarily too.
3. Issues Related to Environmental Protection
Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major polluter by the environmental protection
authorities.
No.
No such cases in the Reporting Period.
XIX Other Significant Events
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XX Significant Events of Subsidiaries
□ Applicable √ Not applicable
48
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the Reporting Period (+/-) After
Shares as
Shares as
dividend
Percent dividend
New converted Subtota Percent
Shares age converted Other Shares
issues from l age (%)
(%) from
capital
profit
reserves
I. Restricted shares 352,511,223 59.15% 0 0 0 0 352,511,223 59.15%
1. Shares held by State 0 0 0 0
2. Shares held by state-owned
350,579,943 58.82% 0 0 0 0 350,579,943 58.82%
legal person
3. Shares held by other
1,931,280 0.33% 1,931,280 0.33%
domestic investors
Among which: Shares held
1,894,980 0.32% 1,894,980 0.32%
by domestic legal person
Shares held by
36,300 0.01% 36,300 0.01%
domestic natural person
4. Shares held by other
0
foreign investors
II. Unrestricted shares 243,467,869 40.85% 0 0 0 0 243,467,869 40.85%
1. RMB common shares 175,862,626 29.51% 0 0 0 0 175,862,626 29.51%
2. Domestically listed foreign
67,605,243 11.34% 0 0 0 0 67,605,243 11.34%
shares
100.00 100.00
III. Total shares 595,979,092 595,979,092
% %
Reasons for share changes:
□ Applicable √ Not applicable
Approval of share changes:
□ Applicable √ Not applicable
Transfer of share ownership:
49
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
□ Applicable √ Not applicable
Progress on any share repurchases:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Effects of share changes on the basic and diluted earnings per share, equity per share attributable to the Company‘s ordinary
shareholders and other financial indicators of the prior year and the prior accounting period, respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
□ Applicable √ Not applicable
II. Issuance and Listing of Securities
1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period
□ Applicable √ Not applicable
2. Changes to Total Shares, Shareholder Structure and Asset and Liability Structures
□ Applicable √ Not applicable
3. Existing Staff-Held Shares
□ Applicable √ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
Unit: share
Number of Number of Number of Number of
ordinary 45,465 ordinary 45,610 preferred 0 preferred 0
shareholders shareholders at shareholders with shareholders
50
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
the month-end resumed voting with resumed
prior to the rights (if any) (see voting rights at
disclosure of this note 8) the month-end
Report prior to the
disclosure of this
Report (if any)
(see note 8)
5% or greater shareholders or top 10 shareholders
Total Shares in pledge or frozen
Increase/
Sharehold shares
decrease Restricted Unrestrict
Name of Nature of ing held at
in the shares ed shares
shareholder shareholder percentag the Status Shares
Reporting held held
e period-en
Period
d
Shenzhen
Investment State-owned legal 380,378,8 380,378,8 350,579,9 29,798,95
63.82%
Holdings person 97 97.00 43 4
Corporation
Shenzhen
Duty-Free Domestic
Commodity non-state-owned 0.29% 1,730,300 0 1,730,300 0
Enterprises Co., legal person
Ltd.
Domestic natural
Yang Yaochu 0.24% 1,410,620 0 0 1,410,620
person
Domestic natural
Li Jing 0.20% 1,176,740 214,300 0 1,176,740
person
Domestic natural
Su Zhifen 0.19% 1,150,000 1,150,000 0 1,150,000
person
Domestic natural
Mai Furong 0.19% 1,130,500 0 0 1,130,500
person
Wuhan
Xingkaiyuan Domestic
Electric Power non-state-owned 0.17% 1,000,000 1,000,000 0 1,000,000
Engineering Co., legal person
Ltd
Domestic natural
Chen Liying 0.14% 846,621 -255,430 0 846,621
person
Domestic natural
Cao Yifan 0.14% 820,460 60,460 0 820,460
person
Zhang Shaoming Domestic natural 0.13% 785,000 785,000 0 785,000
51
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
person
Strategic investor or general legal
person becoming a top-10 ordinary
N/A
shareholder due to rights issue (if any)
(see note 3)
The first largest shareholder, Shenzhen Investment Holding Corporation, is the actual
Related or acting-in-concert parties
controlling shareholder of the Company. And the Company does not know whether there
among the shareholders above
are related parties or acting-in-concert parties among the other 9 shareholders.
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held at the period-end
Type Shares
Shenzhen Investment Holdings RMB common
29,798,954 29,798,954
Corporation share
Domestically
Yang Yaochu 1,410,620 listed foreign 1,410,620
share
Domestically
Li Jing 1,176,740 listed foreign 1,176,740
share
RMB common
Su Zhifen 1,150,000 1,150,000
share
Domestically
Mai Furong 1,130,500 listed foreign 1,130,500
share
Wuhan Xingkaiyuan Electric Power RMB common
1,000,000 1,000,000
Engineering Co., Ltd share
Domestically
Chen Liying 846,621 listed foreign 846,621
share
Domestically
Cao Yifan 820,460 listed foreign 820,460
share
RMB common
Zhang Shaoming 785,000 785,000
share
Domestically
He Simo 762,650 listed foreign 762,650
share
Related or acting-in-concert parties
The first largest shareholder, Shenzhen Investment Holding Corporation, is the actual
among top 10 unrestricted public
controlling shareholder of the Company. And the Company does not know whether there
shareholders, as well as between top
52
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
10 unrestricted public shareholders are related parties or acting-in-concert parties among the other 9 shareholders.
and top 10 shareholders
Top 10 ordinary shareholders involved
in securities margin trading (if any) N/A
(see note 4)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yea √ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a local state-owned legal person
Type of the controlling shareholder: legal person
Legal
Name of controlling Unified social credit
representative/person Date of establishment Principal activity
shareholder code
in charge
To execute the investment,
operating and management
of the state-owned equities
of the wholly-owned,
controlling and
stock-participating
enterprises through the
methods such as the
restructuring integration,
capital operation and assets
disposal; to engage in the
Shenzhen Investment property development and
Wang Yongjian 13 October 2004 914403007675664218
Holdings Corporation operation business within
the scale of legally acquire
the land use right; to
execute the policy-based
and strategic investment
according to the
requirements of the
SASAC; to provide the
guarantee of the municipal
state-owned enterprises;
other business developed
with the authority from the
53
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Municipal State-owned
Assets Supervision and
Administration
Commission.
SZPRD A (000011) holds 380.38 million shares, accounting for 63.82%; Shenzhen Textile (000045)
holds 234.06 million shares, accounting for 46.21%; Shenzhen Shenbao A (000019) holds 72.25
Shareholdings of the million shares, accounting for 16.00%; SPG A (000029) holds 642.88 million shares, accounting
controlling shareholder in for 63.55%; Shenzhen Universe A (000023) holds 14.44 million shares, accounting for 10.41%;
other listed companies at Ping‘an (601318) holds 962.72 million shares, accounting for 5.27%; Guosen Securities (002736)
home or abroad in this holds 2,749.52million shares, accounting for 33.53%; Guotai Jun‘an (601211) holds 624.07
Reporting Period million shares, accounting for 8.18%; Telling Telecommunication (000829) holds 131,917,569
shares, accounting for 13.76%; Emap Information (834386) holds 42.00 million shares, accounting
for 60.00%; CCIC-Testing (836325) holds 20.00million shares, accounting for 40.00%.
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: local institution for state-owned assets management
Type of the actual controller: legal person
Legal
Date of Unified social credit
Name of actual controller representative/per Principal activity
establishment code
son in charge
(I) Implementing and practicing
state, provincial and municipal
laws and regulations related to
management on state-owned
assets, drafting local laws,
regulations, and policies about
management on state-owned
assets, and organizing
Shenzhen Municipal
implementation activities upon
State-owned Assets Supervision Peng Haibin N/A
approvals. Intending to draft
and Administration Commission
supervision systems and
methods about operational
state-owned assets, and
organizing implementation
activities.
(II) On the basis of authorization
from municipal government,
fulfilling duties of investors
54
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
according to laws and
regulations, and protecting the
rights and interests of investors
for state-owned assets according
to laws
(III) Taking charge of
Party-building work for
enterprises in its supervision and
organs entrusted
(IV) Undertaking the
supervision over state-owned
assets of municipal enterprises,
strengthening management on
state-owned assets, further
perfecting the management
mechanism for state-owned
assets with the unification of
power, obligation, and duties, as
well as the combination of
managing assets, people, and
affairs
(V) Being responsible for
hedging and appreciation of the
value of state-owned assets of
enterprises in its supervision,
establishing and perfecting the
index system for hedging and
appreciation of the value of
state-owned assets, setting out
assessment standards,
supervising on hedging and
appreciation of the value of
state-owned assets of enterprises
in its supervision by statistics,
audit, and check, and urging
enterprises in its supervision to
fulfill social duties
(VI) In charge of researching
and preparing the general
planning for transformation and
development of state-owned
enterprise in its supervision,
guiding and boosting
transformation and
55
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
re-organization of state-owned
enterprises, prompting the
construction of modern
enterprise system, carrying
forward operation of
state-owned capital, pushing the
strategic adjustment on
state-owned economy layout and
structure, and making
state-owned capital play the role
in significant industries and key
fields including national
security, national economy
lifeline, etc.
(VII) Directing and propelling
enterprises in its supervision to
perfect company governance
structure, intensifying
construction of Board and
Supervision Committees of
enterprises in its supervision,
and forming the governance
mechanism with specific duties,
coordinating operation, and
effective counterbalance
(VIII) Assuming the
management work of income
distribution for enterprises in its
supervision, and standardizing
the income distribution and
position-related consumption
over people in charge of
enterprises in its supervision
(IX) In line with rules of
municipal Party committee,
appointing and dismissing,
appraising, as well as, in
accordance with business
performance, rewarding and
punishing people in charge of
enterprises in its supervision by
applying legal procedures,
establishing the mechanism of
selecting and choosing
56
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
candidates meeting the
requirements of socialist market
economy system and modern
enterprise system, and perfecting
the incentive and control system
for operators
(X) Being responsible for
appointing or recommending
board directors, supervisors,
CFOs to enterprises in its
supervision, and auditing on
economic duties of people in
charge of enterprises in its
supervision according to rules
about management authorization
to people in charge of
enterprises
(XI) In charge of preparing the
draft of budgets and final
accounts of annual state-owned
capital of enterprises in its
supervision, including it to the
government budget system,
organizing the execution upon
approvals, and collecting
earnings of state-owned capital
handed in by enterprises in its
supervision
(XII) In charge of strategy
research, policy formulation,
and guidance for transformation,
development, and asset
management related to
collectively-owned enterprises
(XIII) Assuming other
assignments assigned by
municipal government and
superior departments
Shareholdings of the actual
controller in other listed Listed companies such as the Shenzhen Airport, YTP, Shenzhen Energy, Shenzhen Zhenye,
companies at home or abroad in Shenzhen Tagen, Agricultural Products and SDGI.
this Reporting Period
Change of the actual controller during the Reporting Period:
57
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of asset management.
□ Applicable √ Not applicable
4. Other 10% or Greater Corporate Shareholders
□ Applicable √ Not applicable
5. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder, Actual Controller,
Reorganizer and Other Commitment Makers
□ Applicable √ Not applicable
58
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part VII Preferred Shares
□ Applicable √ Not applicable
No preferred shares in the Reporting Period.
59
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part VIII Directors, Supervisors, Senior Management and Staff
I Change in Shareholdings of Directors, Supervisors and Senior Management
Beginnin Increase Decrease
Other Ending
g in the in the
Office Incumben Start of End of increase/d sharehold
Name Gender Age sharehold Reporting Reporting
title t/Former tenure tenure ecrease ing
ing Period Period
(share) (share)
(share) (share) (share)
Liu Chairman
Incumben 15 June 14 June
Shengxia of the Male 48 0 0 0 0 0
t 2018 2021
ng Board
Wang Director, Incumben 15 June 14 June
Male 53 0 0 0 0 0
Hangjun GM t 2018 2021
Wei Incumben 15 June 14 June
Director Male 49 0 0 0 0 0
Xiaodong t 2018 2021
Shen Director Incumben 15 June 14 June
Female 50 0 0 0 0 0
Xueying and CFO t 2018 2021
Incumben 15 June 14 June
Wang Ge Director Male 48 0 0 0 0 0
t 2018 2021
Zhang Incumben 15 June 14 June
Director Male 41 0 0 0 0 0
Shilei t 2018 2021
Chairman
Chen 30 June 15 June
of the Former Male 62 0 0 0 0 0
Yugang 2006 2018
Board
Director 15 July 15 June
Wei Zhi Former Male 62 0 0 0 0 0
and GM 2008 2018
Director,
Chairman 22
Liu 15 June
of the Former Male 61 December 0 0 0 0 0
Guangxin 2018
Labor 2007
Union
Guo Director 30 June 15 June
Former Male 46 0 0 0 0 0
Liwei 2006 2018
Director 1
15 June
Wen Li Former Female 50 December 0 0 0 0 0
2018
2007
Yuan Independ Incumben Male 48 14 April 14 June 0 0 0 0 0
60
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Hongchan ent t 2017 2021
g Director
Independ
Mei Incumben 15 June 14 June
ent Male 55 0 0 0 0 0
Yonghong t 2018 2021
Director
Independ
Li Incumben 15 June 14 June
ent Male 42 0 0 0 0 0
Qingyuan t 2018 2021
Director
Independ 22
15 June
Li Jianxin ent Former Male 65 October 0 0 0 0 0
2018
Director 2014
Independ 22
15 June
Zhang Qi ent Former Male 41 October 0 0 0 0 0
2018
Director 2014
Chairman
Dai of the Incumben 15 June 14 June
Male 57 0 0 0 0 0
Xianhua Superviso t 2018 2021
ry Board
Zhang Superviso Incumben 15 June 14 June
Male 44 0 0 0 0 0
Manhua r t 2018 2021
Li Superviso Incumben 15 June 14 June
Male 37 0 0 0 0 0
Qinghua r t 2018 2021
Wang Superviso 3 June 15 June
Former Female 57 0 0 0 0 0
Xiuyan r 2011 2018
Employee
Wang Incumben 15 June 14 June
superviso Female 49 0 0 0 0 0
Qiuping t 2018 2021
r
Employee
Gu Incumben 15 June 14 June
superviso Female 38 0 0 0 0 0
Weimin t 2018 2021
r
Fan Incumben 15 June 14 June
Vice GM Male 54 0 0 0 0 0
Weiping t 2018 2021
Incumben 15 June 14 June
Cai Lili Vice GM Female 47 0 0 0 0 0
t 2018 2021
Incumben 15 June 14 June
Li Peng Vice GM Male 43 0 0 0 0 0
t 2018 2021
Zhang Incumben 15 June 14 June
Vice GM Male 44 0 0 0 0 0
Gejian t 2018 2021
Deng 28 April 18 May
CFO Former Male 41 0 0 0 0 0
Shaowu 2017 2018
61
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total -- -- -- -- -- -- 0 0 0 0 0
II Change of Directors, Supervisors and Senior Management
√Applicable □ Not applicable
Name Office title Type of change Date of change Reason for change
Chairman of the
Chen Yugang Left 15 June 2018 To the age of retirement
Board
Wei Zhi Director and GM Left 15 June 2018 To the age of retirement
Director, Left
Liu Guangxin Chairman of the 15 June 2018 To the age of retirement
Labor Union
Guo Liwei Director Left 15 June 2018 Job transfer
Wen Li Director Left 15 June 2018 Job transfer
Deng Shaowu CFO Dismissed 18 May 2018 Job transfer
Independent
Zhang Qi Left 15 June 2018 Jon-related reason
Director
Independent Left when the
Li Jianxin 15 June 2018 Two consecutive terms expired
Director term expired
Wang Xiuyan Supervisor Left 15 June 2018 To the age of retirement
No longer holding the post of supervisor, but as the vice
Zhang Gejian Supervisor Appointed 15 June 2018
GM
III Biographical Information
Professional backgrounds, major work experience and current duties in the Company of the incumbent directors, supervisors and
senior management:
Members of the Board of Directors:
Mr. Liu Shengxiang, born in August 1971, is a now member of the Communist Party of China, professor-level senior engineer,
National Certified Architect (Level 1), and has obtained his Bachelor Degree, Master of Engineering, and MBA. In June 1994, he
joined Shenzhen Tagen Group Co., Ltd., and successively served as the deputy general manager, general manager, and general Party
branch secretary of Shenzhen Municipal Engineering Corp. and the deputy general manager of Shenzhen Tagen Group Co., Ltd. In
June 2013, he joined Shenzhen Road & Bridge Group as the executive director, Secretary of the Party Committee and general
manager. He now is the Secretary of the Party Committee and the Chairman of the Company. Mr. Liu Shengxiang was awarded the
title of Outstanding Communist Party Member of Shenzhen in 2001, and obtained Tien-yow Jeme Civil Engineering Prize in 2013,
and May 1st Labor Medal of Shenzhen in 2015, the Party representative of the 6th Party Congress in Shenzhen.
Mr. Wang Hangjun, born in Nov. 1966, member of Communist Party of China, is a senior auditor with a master degree of economy.
He ever took post of Deputy Chief of Audit Bureau of Nanshan District, Shenzhen; Vice Minister, Minister of Audit Department of
Shenzhen Investment and Management Company; Vice Minister, Minister of Supervision Department of Shenzhen Investment and
Management Company; Minister of Audit and Inspection Department of Shenzhen Investment Holding Co., Ltd. He has been Deputy
GM of the Company since Oct. 2007. Now he is the Director, deputy Party Secretary and GM of the Company.
Mr. Wei Xiaodong, born in January 1970, is a member of the Communist Party of China with the Bachelor‘s Degree. Mr. Wei
62
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Xiaodong ever worked in the municipal government department of Shenzhen for many years. In 2008, he began to work for
Shenzhen State-owned Assets Supervision and Administration Commission, and successively served as the deputy director and
director of Shenzhen SASAC Office. In June 2014, he served as the deputy director of Shenzhen SASAC Office, and now, he is the
Director, deputy secretary of the Party committee, Secretary of Committee for Discipline Inspection.
Ms. Shen Xueying, born in October 1969, Bachelor of Economics, is a senior accountant. Ms. Shen Xueying has been engaged in
the financial management of listed companies for more than 20 years. She joined the Finance Department of the Company in 1991
and successively served as the clerk and deputy manager of the financial management department of the Company. She was the
manager of the financial management department of the Company from 2007-2018 and now she is currently the Director and Chief
Financial Officer of the Company.
Mr. Wang Ge, born in October 1971, the member of the Communist Party of China, is now the senior engineer with the degree of
Bachelor of Engineering. Mr. Wang Ge has been engaged in the enterprise management for many years. He successively served as
the deputy director and director of the engineering department of Shenzhen Jian‘an (Group) Co., Ltd., the manager and the deputy
secretary of the Party Branch of Jian‘an Group Construction and Municipal Engineering Company, and the deputy general manager,
director, the deputy secretary of the Party Committee and the general manager of Jian‘an Group. From March 2017 to present, he has
served as the Chief Engineer of Shenzhen Investment Holdings Co., Ltd.
Mr. Zhang Shilei, Born in December 1976, is the member of the Communist Party of China with the degree of Master of
Management, and successively served as the office director of Shenzhen Information Pipeline Co., Ltd., the deputy director of the
general office of Shenzhen Investment Holdings Co., Ltd., the director of Shenzhen Wuzhou Hotel Co., Ltd., the deputy secretary of
the Party Committee and the secretary of the Committee for Discipline Inspection. From September 2017 to present, he serves as the
director of the general management department of Shenzhen Investment Holdings Co., Ltd.
Mr. Yuan Hongchang, born in Mar. 1971, Chinese nationality without overseas residency, is a undergraduate and postgraduate of
Tsinghua University, EMBA of Central Europe. He holds professional qualification of registered land appraiser of China and
registered real estate broker. He joined in Shenzhen WorldUnion Properties Consultancy Incorporated in 2001, and acted as Vice GM
in East China Region, GM of Shanghai WorldUnion, GM in East China Region. Now he works as Vice GM and Secretary of Board
in Shenzhen WorldUnion Properties Consultancy Incorporated. Mr. Yuan Hongchang has attended the 80th phase of independent
directors‘ training class of Shenzhen Stock Exchange with qualification certificate of independent director.
Mr. Mei Yonghong, born in October 1964, is the member of the Communist Party of China, and graduated from the Department of
Agriculture of Huazhong Agricultural University with the Degree of Bachelor of Agriculture. He successively served as the deputy
director of the General Office of Ministry of Science and Technology and the director of the information research office, the director
of the Policy, Regulations and System Reform Department of Ministry of Science and Technology and the mayor of Jining City in
Shandong Province. From September 2015 to present, he has served as the director of China National GeneBank (CNGB) and the
chairman of BGI Agricultural Group.
Mr. Li Qingyuan, Born in 1977, is the member of the Communist Party of China with the Chinese nationality. After he obtained the
degree of the Doctor of Accountancy, he became a visiting scholar of Columbia University, and was successively supported by
Program for New Century Excellent Talents in University of Ministry of Education in 2012, 351 Program for Talents of Wuhan
University in 2011 and Outstanding Accounting Talents (Academic) of Ministry of Finance in 2008. Meanwhile, he also serves as the
member of the Academic Exchange Committee of Accounting Society of China, the editor member of China Journal of Accounting
Studies, the professional editor-in-chief of Luojia Management Review and the director of the Board of Journal of Management
Accounting Studies. As a professor (Level 4), he is nominated and elected into National Support Program for Outstanding Young
Talents, and now serves as the deputy dean of the department of economy and management and the director of the department of
accounting of Wuhan University.
Members of the Supervisory Committee:
Mr. Dai Xianhua, was born in April 1962, doctor degree, Party member of CPC. He worked as a lecturer in School of Business and
Economy of Zhongnan University of Economics and Law from 1986 to 1989. He took posts of editor of department of theory and
63
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
review, vice director, and editor-in-chief, in Shenzhen Economic Daily from 1992 to 1997; worked in Shenzhen State Assets
Administration Committee (hereinafter referred as ―Shenzhen SAC‖) as Vice Section Chief of Assets Management Department,
investigator of property right management Department, Vice Director, investigator of Office, and investigator of Appraisal and
Distribution Department from 1997 to 2012. Since 2012 he is the Chairman of the Supervisory Committee of the Company.
Mr. Zhang Manhua, born in Feb. 1975, master‘s degree, member of the Communist Party of China, studied and worked in Central
South University from 1992 to 2004; Senior Manager in the Investment Center of Konka Group and concurrently worked as the
Board Secretary for Shenzhen Jvlong Optoelectronic Co., Ltd., and Investment Manager in Shenchao Technological Investment Co.,
Ltd. from 2004 to 2013; he worked as deputy director in the Strategy & Development Department in Shenzhen Investment Holding
Co., Ltd from 2013 to 2018. He is the director in Law and Risks Management department of Shenzhen Investment Holdings Co., Ltd
since 2018.
Mr. Li Qinghua, born in April 1982, has obtained his Bachelor degree. From 2003 to 2013, he worked for DZX International
Appraisal Limited, and successively served as the project assistance, the project manager and the senior manager; from 2013 to 2017,
he served as the senior executive of the property right management and legal affairs department of Shenzhen Investment Holdings
Co., Ltd., and from 2017 till now, he serves as the deputy director of the audit department of Shenzhen Investment Holdings Co., Ltd.
Ms. Wang Qiuping, born in Jan. 1970, Bachelor degree, member of the Communist Party of China, is a senior economist. From
1992 to 2015, she ever took post in GM office, Plan and Finance Department, and Development Management. Since 2015, she is the
Party Committee Secretary and GM of Shenzhen International Trade Center Property Management Co., Ltd.
Ms. Gu Weimin, Born in October 1981, is the member of the Communist Party of China with the Master‘s Degree. From 2007 to
2010, he served as the audit assistance manager of KPMG Shenzhen; from 2011 till now, he has worked for the Company in the audit
department (the office of the board of supervisors), and is now the deputy director of the audit department.
Executive officers:
Mr. Wang Hangjun, born in Nov. 1966, member of Communist Party of China, is a senior auditor with a master degree of economy.
He ever took post of Deputy Chief of Audit Bureau of Nanshan District, Shenzhen; Vice Minister, Minister of Audit Department of
Shenzhen Investment and Management Company; Vice Minister, Minister of Supervision Department of Shenzhen Investment and
Management Company; Minister of Audit and Inspection Department of Shenzhen Investment Holding Co., Ltd. He has been Deputy
GM of the Company since Oct. 2007. Now he is the Director, deputy Party Secretary and GM of the Company.
Mr. Fan Weiping, born in Apr. 1965, is a member of the Communist Party of China with postgraduate degree. He used to work in
Shenhua Group successively as the Chief of the Legal Affairs Section in the Supervisory and Audit Department; the Vice Manager
and Manager of the Legal Affairs Department; the GM Assistant; and the Chief Legal Adviser. Since Jan. 2009, he has become the
Board Secretary and the Chief Legal Adviser for the Company. And he has been a Vice GM, the Board Secretary and the Chief Legal
Adviser for the Company since Feb. 2012, and he got the qualification certificate of Board Secretary in Shenzhen Stock Exchange in
2009. Now he is the member of the Party Committee, vice GM, Chief Legal Adviser, and Board Secretary of the Company.
Ms. Cai Lili, Born in November 1972, is the member of the Communist Party of China, and has obtained the Master‘s Degree in
Economics. Since 1995, he has worked in Shenzhen Tax Service, SAT, and ever served as the deputy chief of the taxation and
scientific and technological development department of Shenzhen Tax Service, SAT, and the member of the Party Organization and
the deputy director of Futian District Tax Bureau in Shenzhen. Currently, he is the member of the Party Committee, deputy general
manager and Chief Financial Officer.
Mr. Li Peng, Born in May 1976, is the member of the Communist Party of China, the Bachelor of Engineering and the intermediate
economist. Since July 1999, he has worked for the Company as the operation manager, and successively served as the deputy
manager of the Company‘s development management department, the manager of the cost control department, and the secretary of
the Party branch and the deputy general manager of Shenzhen Huangcheng Real Estate Co., Ltd. Currently, he now is the member of
the Party Committee, and deputy general manager.
Mr. Zhang Gejian, born in September 1975, the member of the Communist Party of China, MBA, is an Accountant as well as
Auditor. He was engaged in internal auditing work in Audit Department of the Company since July 1997. He acted as the audit
64
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
manager, Supervisor of the Company and concurrently the Cost Control Manager. Now he is the member of the Party Committee,
and the vice GM of the Company.
Ms. Shen Xueying, born in October 1969, the member of the Communist Party of China, Bachelor of Economics, is a senior
accountant. Ms. Shen Xueying has been engaged in the financial management of listed companies for more than 20 years. She joined
the Finance Department of the Company in 1991 and successively served as the clerk and deputy manager of the financial
management department of the Company. She has been the manager of the financial management department of the Company from
2007-2018, and now she is the Director, and Chief Financial Officer of the Company.
Offices held concurrently in shareholding entities:
√Applicable □Not applicable
Office held in
Remuneration or
the
Name Shareholding entity Start of tenure End of tenure allowance from the
shareholding
shareholding entity
entity
Chief
Engineer of
Shenzhen
Wang Ge Shenzhen Investment Holdings Co., Ltd. 1 March 2017 Yes
Investment
Holdings Co.,
Ltd.
Director of
the general
management
department of 1 September
Zhang Shilei Shenzhen Investment Holdings Co., Ltd. Yes
Shenzhen 2017
Investment
Holdings Co.,
Ltd.
Deputy
director in
capital
operation
Zhang Manhua Shenzhen Investment Holdings Co., Ltd. department of 1 January 2017 Yes
Shenzhen
Investment
Holdings Co.,
Ltd
Deputy
director of the
audit
department of
Li Qinghua Shenzhen Investment Holdings Co., Ltd. 1 January 2017 Yes
Shenzhen
Investment
Holdings Co.,
Ltd.
65
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Offices held concurrently in other entities:
√Applicable □Not applicable
Remuneration or
Office held in
Name Other entity Start of tenure End of tenure allowance from
the entity
the entity
Vice GM and
Secretary of
Board in
Yuan Shenzhen WorldUnion Properties Shenzhen 1 September
Yes
Hongchang Consultancy Incorporated WorldUnion 2013
Properties
Consultancy
Incorporated.
Director of
China
National
GeneBank
China National GeneBank, BGI Agricultural 1 September
Mei Yonghong (CNGB) and Yes
Group 2015
the chairman
of BGI
Agricultural
Group
Deputy dean
of the
department of
economy and
management
1 December
Li Qingyuan Wuhan University and the Yes
2015
director of the
department of
accounting of
Wuhan
University.
Punishments imposed in the recent three years by the securities regulator on the incumbent directors, supervisors and senior
management as well as those who left in the Reporting Period:
□ Applicable √ Not applicable
IV Remuneration of Directors, Supervisors and Senior Management
Decision-making procedure, determination basis and actual payments of remuneration for directors, supervisors and senior
management:
During this Reporting Period, the board and the management of the Company signed statement of operation objectives responsibility
for 2018, conducted appraisal system integrating operation indicators, classification indicators with management objectives. After the
66
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
end of this Reporting Period, assessment was implemented by the board. Remuneration of senior executives, according to
―Management Method of Annual salary System of Directors, Supervisors and Senior Executives‖, adopted annual salary system, and
need to be implemented after assessment of the board.
Remuneration of directors, supervisors and senior management for the Reporting Period
Unit: RMB'0,000
Total before-tax
Any
Incumbent/Forme remuneration
Name Office title Gender Age remuneration
r from the
from related party
Company
Chairman of the
Liu Shengxiang Male 48 Incumbent 77.36 No
Board
Wang Hangjun Director, GM Male 53 Incumbent 123 No
Director,
Liu Guangxin Chairman of the Male 61 Former 79.81 No
Labor Union
Guo Liwei Director Male 46 Former Yes
Wen Li Director Female 50 Former Yes
Wang Ge Director Male 48 Incumbent Yes
Zhang Shilei Director Male 41 Incumbent Yes
Independent
Li Jianxin Male 65 Former 3.67 No
Director
Independent
Zhang Qi Male 41 Former 3.67 No
Director
Independent
Yuan Hongchang Male 48 Incumbent 8 No
Director
Independent
Li Qingyuan Male 42 Incumbent 4.33 No
Director
Independent
Mei Yonghong Male 55 Incumbent 4.33 No
Director
Chairman of the
Dai Xianhua Supervisory Male 57 Incumbent 79.15 No
Board
Supervisor and
GM of Shenzhen
International
Wang Qiuping Trade Center Female 49 Incumbent 60.09 No
Property
Management Co.,
Ltd.
67
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Supervisor and
deputy director of
Gu Weimin Female 38 Incumbent 49.53 No
the audit
department
Zhang Manhua Supervisor Male 44 Incumbent Yes
Wang Xiuyan Supervisor Female 57 Former Yes
Li Qinghua Supervisor Male 37 Incumbent Yes
Deputy
secretary of the
Party committee,
Wei Xiaodong Secretary of Male 49 Incumbent 66.5 No
Committee for
Discipline
Inspection
Fan Weiping Vice GM Male 54 Incumbent 113.31 No
Cai Lili Vice GM Female 47 Incumbent 66.5 No
Li Peng Vice GM Male 43 Incumbent 84.37 No
Zhang Gejian Vice GM Male 44 Incumbent 90.58 No
Shen Xueying CFO Female 50 Incumbent 83.58 Yes
Total -- -- -- -- 997.78 --
Equity incentives for directors, supervisors and senior management in the Reporting Period:
□ Applicable √ Not applicable
V Employees
1. Number, Functions and Educational Backgrounds of Employees
Number of in-service employees of the Company as the parent 83
Number of in-service employees of major subsidiaries 5,421
Total number of in-service employees 5,504
Total number of paid employees in the Reporting Period 5,504
Number of retirees to whom the Company as the parent or its
0
major subsidiaries need to pay retirement pensions
Functions
Function Employees
Production 3,838
Sales 213
Technical 915
68
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Financial 203
Administrative 335
Total 5,504
Educational backgrounds
Educational background Employees
College and Technical secondary school graduates and above 2,440
High school graduates and below 3,064
Total 5,504
2. Employee Remuneration Policy
As required by corporate development strategy, based on actual situation to insist the internal industrialization and the marketization
among the industry of the remuneration principles of the Group and our Company adopts a differentiated management on different
industries to satisfy market demands by appropriately increasing the remuneration distance to better attract and retain talents. In HQ
and real estate enterprises, position type management idea is introduced, with all positions divided into Leader Group, Management
Group, Professional Group, Business Group and Service Group at different remuneration levels. Meanwhile, the remuneration for
professional technicians and that for medium-level management are kept overlapped. In this way, remuneration and career
development are provided at the same time. To some extent, the remuneration is a little bit favorable for professionals in real estate
development industry. With regard to other enterprises under the Company group, market reference is applied, but the key is to
appropriately adjust remuneration for key positions or some positions with lower remuneration than market level.
3. Employee Training Plans
In 2019, based on the overall requirements of the Company to establish a learning organization and carry out business development,
as well as the survey on training needs, the Company is going to reinforce training in specialized real estate courses, comprehensive
caliber, expertise knowledge and team building with an aim of further increasing the comprehensive knowledge and improving the
professional competence and skills of the team, seeking synchronized development between the Company and its employees and
achieving the sustainable and sound development of the Company. The major contents of the training will include specialized real
estate courses, comprehensive management capabilities, team development, professional skills, etc, with a combination of internal
and external training to be conducted in a planned way, and all the employees will attend the training in different groups throughout
the year.
4. Labor Outsourcing
□ Applicable √ Not applicable
69
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part IX Corporate Governance
I General Information of Corporate Governance
During this Reporting Period, in accordance with the requirement of the Company Law, Securities Law, Code of Corporate
Governance for Listed Companies in China and Stock Listing Rules of Shenzhen Stock Exchange as well as relevant laws and
statutes of CSRC, the Company continuously regulated and perfected corporate governance structure, established and perfected
internal management and control system and investigated in management activities of the Company, which promoted the Company‘s
standard management level.
As to the end of this Reporting Period, the internal control system of the Company is complete, accomplished and defined that in
accordance with Company Law, Articles of Association and other laws and regulations as well as requirements of regulatory
documents. The convene of Shareholders‘ General Meeting, the Board of Directors and Supervisory Board are strictly in accordance
with relevant rules and regulations, all directors and supervisors earnestly and diligently commit their responsibilities. Corporate
structure of the Company is complete and the operation of the Company is standardized.
With the goal of constructing a standard management structure, the Company has established related regulations on Shareholders‘
Meeting, Board of Directors and Board of Supervisors, to ensure effective rights to decision-making, execution and supervision
respectively.
The Shareholders‘ Meeting shall have the highest right to review and make decision on major issues, including the Company‘s
business idea, investment plan, major trading items, capital changes, appointment and dismissal of directors and supervisors, within
the legal scope as defined by laws, regulations and rules like the Company Law and Articles of Corporation. The Company has
established and strictly followed various regulations, including Rules of Procedure of Shareholders‘ Meeting, to ensure all
shareholders‘ rights.
The Board of Directors has the right to business decision-making, responsible for the establishment and effective execution of the
Company‘s internal control as well. Besides, it further sets up four special committees, namely, Strategic Development & Investment
Committee, Remuneration and Assessment Committee, Audit Committee and Nomination Committee, to improve its operating
efficiency based on corresponding work rules.
The Board of Supervisors acts as a supervising organ for the Company. It checks the Company‘s finance, and supervises all jobs of
the Company‘s directors and senior management. Also, it is responsible for and reports to the Shareholders‘ Meeting.
The business management have the right to execution. They are appointed by the Board of Directors, and responsible for daily
running of business management and internal control.
Based on the principle of science, simplicity and efficiency, the Company has established such functional departments as Office for
Board of Directors, General Manager‘s Office, Cost Control Department, Planning Design Department, Human Resources
Department, Development Management Department, Financial Management Department, Audit Department (Office for Board of
Supervisors), Law and Risk Control Department, Lease Center, and Party Work Office. These departments perform their specific
functions and carry out work in accordance with regulations on internal control, to ensure the Company‘s healthy running.
The Company always pays attention to standardize the management for inside information, such as promulgating the Management
Rules for Insiders, making clear about the contents of inside information, making the scope of insiders and accountability system for
inside dealings. After reporting and submitting non-published information to the controlling shareholders, the Company all registered
the relevant information of insiders and then submitted to securities regulatory authorities, as well as strictly controlled the
transmission scope of inside information, further strengthened the security work of inside information. Upon Self-inspection, during
this Reporting Period, there were no particulars about insiders took advantages of inside information to purchase or sell shares of the
Company before the disclosure of major sensitive information that shall have an impact on the share price of the Company, nor any
70
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
investigation and punishment as well as rectification from the regulatory authority. From now on, the Company will continuously
strengthen to learn relevant rules and laws, scrupulously execute the Management Rules for Insider Information and Insiders,
standardize the corporate governance of the Company, do well the work of preventing inside dealings.
Indicate by tick market whether there is any material incompliance with the regulatory documents issued by the CSRC governing the
governance of listed companies.
□ Yes √ No
No such cases in the Reporting Period.
II The Company’s Independence from Its Controlling Shareholder in Business, Personnel,
Asset, Organization and Financial Affairs
The Company was independent from the controlling shareholder in business, personnel, assets, organization and finance to realize
that independent personnel, independent finance, complete assets, independent organization and independent business.
1. In aspect of business: The Company was independent from the controlling shareholder with independent and complete business
and independent operation capability. There was no business which was same or competitive with the controlling shareholder.
2. In aspect of personnel: The Company was complete independent from the controlling shareholder in terms of labor and personnel,
management on remuneration. All Senior Executives drew the remuneration from the Company, and none held a post concurrently in
shareholders‘ company. Personnel of the Company are independent, all ones signed labor contract with the Company. The Company
was independent from the shareholders or other related parties in personnel management, social security, salary etc.
3. In aspect of asset: The Company‘s assets were complete and independent, the property relationship was clear. There was no capital
occupation by controlling shareholder, and assets of the Company were completely independent from controlling shareholder.
4. In aspect of organization: The Company‘s organization was independent, and the Company implemented rules and regulations as
well as responsibilities for all departments, formed independent responsibilities and rights, scientific and rational internal control
system. Independence of the Company on operation and management is free from impact from controlling shareholders and other
subordinated units. There were no controlling shareholders intervene organization of the Company.
5. In aspect of finance: The Company‘s finance was independent with independent finance department. The Company established the
independent finance settling system and financial management system, had its own finance account and paid the tax in line with laws,
run finance decision-making independently.
The controlling shareholder of the Company performed normatively with no conduct that intervened with the operation
decision-making and operation activities directly or indirectly over the shareholders‘ general meeting, however, the controlling
shareholder could influence on the significant decision-making through the shares holding.
III Horizontal Competition
□ Applicable √ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Investor Index to disclosed
Meeting Type Date of the meeting Disclosure date
participation ratio information
Announcement No.
The 1st General Extraordinary
64.06% 15 June 2018 16 June 2018 2018-21 on the
Meeting of 2018 General Meeting
Resolutions of the
71
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2017 Annual
Meeting of
Shareholders
disclosed on
www.cninfo.com.cn,
Securities News and
Ta Kung
2. Special General Meetings Convened at the Request of Preferred Shareholders with Resumed Voting
Rights
□ Applicable √ Not applicable
V Performance of Duty by Independent Directors in the Reporting Period
1. Attendance of Independent Directors at Board Meetings and General Meetings
Attendance of independent directors at board meetings and general meetings
Total number The
Board
of board Board Board independent
Board meetings
meetings the meetings meetings the director failed General
Independent meetings attended by
independent attended independent to attend two meetings
director attended on way of
director was through a director failed consecutive attended
site telecommunica
eligible to proxy to attend board meetings
tion
attend (yes/no)
Yuan Hongchang 7 1 6 0 0 No 1
Mei Yonghong 3 1 2 0 0 No 1
Li Qingyuan 3 1 2 0 0 No 1
Why any independent director failed to attend two consecutive board meetings:
Not applicable
2. Objections Raised by Independent Directors on Matters of the Company
Indicate by tick mark whether any independent directors raised any objections on any matter of the Company.
□ Yes √ No
No such cases in the Reporting Period.
3. Other Information about the Performance of Duty by Independent Directors
Indicate by tick mark whether any suggestions from independent directors were adopted by the Company.
√ Yes □ No
Suggestions from independent directors adopted or not adopted by the Company:
With attitude of credibility and diligence to the Company and all shareholders, independent directors was diligent and responsible,
72
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
reviewed all resolutions, and in line with their professional knowledge and capability, made independent, objective and fair judgment
away from influence from the Company and principal shareholders of the Company. Also, independent directors expressed
independent, objective and fair opinion on relevant events, which made practical efforts to safeguard interests of the Company and
minority shareholders.
VI Performance of Duty by Specialized Committees under the Board in the Reporting Period
The four special committees under the board—the Strategic Development and Investment Committee, the Nomination Committee,
the Remuneration and Appraisal Committee and the Audit Committee—according to ―Governance Principle of listed Company‖,
―Articles of Association‖, ―and Rules of Procedure of the Board of Directors‖ and implementation rules of special committee,
earnestly performed their duties.
1. Duty Performance of Strategic Development and Investment Committee
During this Reporting Period, strategic development and investment committee paid attention to authorization of the board to project
development and financing, kept good contact with the management and had a good knowledge of matters within their power.
2. Duty Performance of Remuneration and Assessment Committee
During this Reporting Period, remuneration and assessment committee earnestly performed their duties, kept good contact with the
management and conducted several communication with the management for relevant matters.
3. Duty Performance of Audit Committee
During this Reporting Period, audit committee held on-the-spot working conference twice, listened to report of Mazars Certified
Public Accountants (SGP) on audit work, deliberate preliminary audit opinion issued by Mazars Certified Public Accountants (SGP)
and proposed their opinions about 2017 Financial Statement of the Company.
VII Performance of Duty by the Supervisory Committee
Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its supervision in the Reporting
Period.
□ Yes √ No
The Supervisory Committee raised no objections in the Reporting Period.
VIII Appraisal of and Incentive for Senior Management
Within this Reporting Period, the annual operating target plan 2018 was went forth to the management team by the Board of
Directors, of which the Company adopted appraisal method by the score combination of operation index, category index and
administrative goal. At the end of the fiscal year, the Board of Directors examined the final score. For senior executives of the
Company, the Company adopted annual salary system in accordance with Management Measure for Annual Salary System of
Directors, Supervisors and Senior Executives, which shall be implemented after the Board of Directors completing fiscal
examination.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
IX Internal Control
1. Material Internal Control Weaknesses Identified for the Reporting Period
□ Yes √ No
2. Internal Control Self-Evaluation Report
Disclosure date of the internal control
30 March 2019
self-evaluation report
Index to the disclosed internal control
http://www.cninfo.com.cn
self-evaluation report
Evaluated entities‘ combined assets as % of
99.00%
consolidated total assets
Evaluated entities‘ combined operating
revenue as % of consolidated operating 100.00%
revenue
Identification standards for internal control weaknesses
Weaknesses in internal control over financial Weaknesses in internal control not
Type
reporting related to financial reporting
Indications of the serious defect of the If the following situation occurred, could
financial report were including: (1) to be recognized as the serious defect and
execute the misstatement correction of the other situation should be recognized as
great defect occurred on the reported and the important defect or the common
disclosed financial report by the Company; defect respectively according to the
(2) the audit institution discovered the influenced degree: (1) the
current financial report had great defect decision-making of the significant events
while the internal control of the Company of the Company lacked of the collective
didn‘t found out during the operating democratic decision-making process or
process; (3) the supervision of the the collective democratic
Nature standard Company‘s Audit and Risk Committee and decision-making process was not
the internal audit department on the internal normative; (2) the decision-making of
control was invalid; (4) there was significant the Company was not scientific or the
corrupt practice among the Directors, decision-making occurred serious
Supervisors or Senior Management. mistakes; (3) the operating or the
Indications of the important defect of the decision-making seriously violated the
financial report were including: (1) didn‘t national laws and regulations; (4) the
abide by the universally acknowledged Company occurred serious
accounting standard to choose and apply the environmental pollution or other events
accounting policies; (2) had not built up the seriously effected the social public
anti-fraud process and the control measures; interests; (5) the media frequently
74
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(3) had not built up the corresponding occurred the significant negative news;
control mechanism or had not executed the (6) lacked of the important business
corresponding compensating control for the management system or the
accounting treatment which was systematicness of the system operation
unconventional or with special transaction; was invalid; (7) the constantly outflow of
(4) the control during the process of the the key management personnel and
financial report at the period-end existed one technical personnel of the Company; (8)
or multiple defects that could not guarantee the great or significant internal control
the compile of the financial report reach the defect of the Company could not be
goal of being real and complete. Common timely modified; (9) the Company
defect: refers to the other control defect constantly or plentifully occurred the
except for the above great defect and significant internal control defects; (10)
significant defect. other situation may lead the Company to
seriously deviate from the control target.
Serious defect: potential misstatement of the
operating income≥1 % of the operating
income of the consolidated statements of the
current year, potential misstatement of the
The Company compared the magnitude
total assets amount≥0.25% of the total
of the direct property losses amount with
amount of the consolidated statements of the
the net assets amount of the last fiscal
current year. Important defect: 0.75% of the
year to confirm the quantitative criteria
operating income of the consolidated
of the internal control as the follows:
statements of the current year
serious defect: amount of the direct
≤misstatement<1 % of the operating income
property losses≥0.5% of the net assets
Quantitative standard of the consolidated statements of the current
amount of the last fiscal year; important
year; 0.2% of the total amount of the
defect: 0.4% of the net assets amount of
consolidated statements of the current year
the last fiscal year ≤losses amount<0.5%
≤misstatement<0.25 of the total amount of
of the net assets amount of the last fiscal
the consolidated statements of the current
year; common defect: losses
year. Common defect: misstatement of the
amount<0.4% of the net assets amount of
operating income<0.75% of the operating
the last fiscal year
income of the consolidated statements of the
current year, misstatement of the total assets
amount<0.2 of the total assets amount of the
consolidated statements of the current year
Number of material weaknesses in internal
0
control over financial reporting
Number of material weaknesses in internal
0
control not related to financial reporting
Number of serious weaknesses in internal
0
control over financial reporting
Number of serious weaknesses in internal
0
control not related to financial reporting
75
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
X Independent Auditor’s Report on Internal Control
√ Applicable □ Not applicable
Opinion paragraph in the independent auditor‘s report on internal control
We believe that Shenzhen Properties & Resources Development (Group) Ltd. maintained efficient internal control of financial
reports in all significant aspects according to ―Basic Standards of Corporate Internal Control‖ and relevant regulations.
Independent auditor‘s report on
Disclosed
internal control disclosed or not
Disclosure date 30 March 2019
Index to such report disclosed http://www.cninfo.com.cn
Type of the auditor‘s opinion Unmodified unqualified opinion
Material weaknesses in internal
control not related to financial None
reporting
Indicate by tick mark whether any modified opinion is expressed in the independent auditor‘s report on the Company‘s internal
control.
□ Yes √ No
Indicate by tick mark whether the independent auditor‘s report on the Company‘s internal control is consistent with the internal
control self-evaluation report issued by the Company‘s Board.
√ Yes □ No
76
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part X Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding before the date of this
Report‘s approval or were due but could not be redeemed in full?
No.
77
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part XI Financial Statements
I Independent Auditor’s Report
Type of the independent auditor‘s opinion Unmodified unqualified opinion
Date of signing this report 29 March 2019
Name of the independent auditor Ruihua Certified Public Accountants (LLP)
Reference number of Audit Report Ruihua Audit Report【2019】No. 48400002
Name of the certified public accountants Cai Xiaodong and Wang Huansen
Text of the Auditor‘s Report
All shareholders of Shenzhen Properties & Resources Development (Group) Ltd.:
1. Opinion
We have audited the financial statements of Shenzhen Properties & Resources Development (Group) Ltd. (the ―Company‖), which
comprise the consolidated and parent company balance sheets as of 31 December 2018, the consolidated and parent company
statements of income, cash flows and changes in owners‘ equity for the year then ended, as well as the notes to the financial
statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated and parent company
financial position of the Company at 31 December 2018, and the consolidated and parent company operating results and cash flows
for the year then ended, in conformity with the Chinese Accounting Standards (CAS).
2. Basis for Opinion
We conducted our audits in accordance with the Audit Standards for Chinese Registered Accountants. Our responsibilities under
those standards are further described in the Auditor‘s Responsibilities for Audit of Financial Statements section of our report. We are
independent of the Company in accordance with the China Code of Ethics for Certified Public Accountants, and we have fulfilled our
other ethical responsibilities in accordance with the said Code of Ethics. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
3. Key audit items
Key audit items are the items that are considered most important for the audit of the current financial statements based on our
professional judgment. The response to these items is based on the audit of the financial statements as a whole and the formation of
audit opinions. We do not comment on these items separately. We confirm that the following items are key audit items needed to be
expressed in the Audit Report.
(I) Revenue Recognition of Real Estate Development Projects
1. Description
As of 31 December 2018, the main business income (the income from the sales of real estate) reflected in the Notes to the Group‘s
consolidated financial statements was RMB 2.283 billion, accounting for 81.90% of the Group‘s total revenue. As the gross profit
accounted for 96.02% of the consolidated gross profit, it shall be counted as the major source of income and profit for the Group.
Therefore, we count the income from the Group‘s real estate development business as a key audit matter.
According to the revenue recognition accounting policy of SZPRD, the recognition of the Company‘s real estate sales income must
78
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
meet the following conditions: the development product has been completed and qualified for acceptance, and the realization of sales
revenue is recognized after the property is handed over to the owner in accordance with the contract. (See Note IV. 23 ―Revenue‖ for
details).
2. Audit Treatment
During the audit of business income of SZPRD‘s real estate development projects, the audit procedures we‘ve implemented mainly
include: We evaluated the effectiveness of the design and operation of key internal controls related to the revenue recognition of real
estate development projects; we checked all provisions stated in the real estate sales contract to verify whether the income
recognition policy of SZPRD‘s real estate development projects meets the requirements of relevant accounting standards; we took
samples from the project whose real estate sales revenue was recognized to check the sales contract, the payment status and the
receipt of the building and to evaluate whether relevant real estate sales were recognized in accordance with the Group‘s revenue
recognition policy; for various projects whose real estate sales revenue was recognized before and after the balance sheet date, we
selected some samples, checked the sales contract, the payment status and the receipt of the building to evaluate whether relevant real
estate sales revenue was recognized during the appropriate period; for the real estate income recognized in this year, we re-calculated
various taxes and verified whether there existed any difference.
(II) Calculation and Withdrawal of Land Appreciation Tax
1. Description
The land value-added tax is one of the major taxes payable by SZPRD, and for the real estate sold and developed by SZPRD, it‘s
required to pay the land value-added tax based on the land value-added amount resulting from the transfer of real estate and the
progressive tax rate of 30% to 60%. However, for various real estate development enterprises specialized in constructing ordinary
standard residential buildings for sales, if the value-added amount does not exceed 20% of the deducted project amount, they shall be
exempted from paying the land value-added tax; otherwise, related taxes shall be calculated based on the added value. Therefore, at
the end of each financial reporting period, the management needs to estimate the amount of the land value-added tax. In making the
judgment on the estimation, main factors required to be considered include the provisions and explanations of relevant tax laws and
regulations, and the estimated real estate sales revenue minus the estimated deductible land costs, real estate development costs,
interest expenses, development costs etc. When SZPRD clears the land value-added tax, the actual tax payable may differ from the
amount estimated by SZPRD. As the accrued land value-added tax accounts for a large proportion in the taxes and taxes payable
reflected in the consolidated financial statements, and the management‘s judgment on the estimation includes various considerations
such as the understanding of relevant tax laws, regulations and practices. Therefore, we have counted the accrual of the land
value-added tax of SZPRD as a key audit matter.
2. Audit Treatment
Evaluate the effectiveness of the design and operation of key internal controls related to the land value-added tax made by the
management; the evaluation of the accrual of the land value-added tax on 31 December 2018 by SZPRD, includes the evaluation of
SZPRD‘s assumptions and judgment based on our understanding of the actual implementation of related tax laws by various local tax
authorities, the evaluation of the management‘s estimations on the expected income from the real estate sales and on the deductible
amount, the evaluation of the management‘s assumptions and judgment, the re-calculation of the land value-added tax accrued by
SZPRD, and the comparison between our calculated results and the amount recorded by SZPRD.
We confirm that there are no other key audit matters that need to be expressed in the audit report issued by us.
4. Other Information
The Company‘s management is responsible for the other information. The other information comprises all of the information
included in the Company‘s 2018 Annual Report other than the financial statements and our auditor‘s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion
thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider
79
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
5. Responsibilities of Management and Those Charged with Governance for Financial Statements
The Company‘s Management (hereinafter referred to as the ―Management‖) is responsible for the preparation of the financial
statements that give a fair view in accordance with CAS, and for designing, implementing and maintaining such internal control as
the management determines is necessary to enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the Management is responsible for assessing the Company‘s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
Management either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company‘s financial reporting process.
6. Auditor’s Responsibilities for Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor‘s report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with CAS will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with CAS, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by the management.
(4) Conclude on the appropriateness of the management‘s use of the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the
Company‘s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required by CAS to draw
users‘ attention in our auditor‘s report to the related disclosures in the financial statements or. if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor‘s report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the
financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the
Company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the
Company audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding the planned scope and timing of the audit and significant audit
findings, including any noteworthy deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in
the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our
auditor‘s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Ruihua Certified Public Accountants Chinese CPA
(Engagement Partner)
Cai Xiaodong
BeijingChina Chinese CPA
Wang Huansen
29 March 2019
II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by ShenZhen Properties & Resources Development (Group) Ltd.
31 December 2018
Unit: RMB
Item 31 December 2018 31 December 2017
Current assets:
Monetary capital 3,389,234,357.72 2,477,028,815.21
Settlement reserve
Interbank loans granted
Financial assets at fair value through
profit or loss
Derivative financial assets
Notes and accounts receivable 64,231,267.94 46,272,600.86
Including: Notes receivable
Accounts receivable 64,231,267.94 46,272,600.86
Prepayments 35,913,164.32 28,149,956.60
Premiums receivable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Reinsurance receivables
Receivable reinsurance contract reserve
Other receivables 24,428,411.19 91,345,782.84
Including: Interest receivable 8,293,317.33
Dividends receivable
Financial assets purchased under resale
agreements
Inventories 1,181,762,531.67 1,850,672,044.36
Assets classified as held for sale
Current portion of non-current assets
Other current assets 16,694,408.12 12,370,820.97
Total current assets 4,712,264,140.96 4,505,840,020.84
Non-current assets:
Loans and advances to customers
Available-for-sale financial assets 3,621,381.11 3,591,209.20
Held-to-maturity investments
Long-term receivables
Long-term equity investments 39,999,283.24 38,730,392.96
Investment property 400,550,689.90 426,849,558.05
Fixed assets 32,612,592.40 29,346,901.33
Construction in progress
Productive living assets
Oil and gas assets
Intangible assets
R&D expense
Goodwill
Long-term prepaid expense 2,398,576.29 951,368.85
Deferred income tax assets 519,783,531.64 388,022,097.64
Other non-current assets 108,971,942.00
Total non-current assets 1,107,937,996.58 887,491,528.03
Total assets 5,820,202,137.54 5,393,331,548.87
Current liabilities:
Short-term borrowings
Borrowings from central bank
Customer deposits and interbank
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
deposits
Interbank loans obtained
Financial liabilities at fair value through
profit or loss
Derivative financial liabilities
Notes and accounts payable 398,429,855.96 491,963,303.62
Advances from customers 265,338,215.34 516,984,711.11
Financial assets sold under repurchase
agreements
Handling charges and commissions
payable
Payroll payable 96,069,521.54 92,066,474.54
Taxes payable 1,552,720,630.59 1,192,587,256.66
Other payables 112,502,146.69 122,622,000.38
Including: Interest payable 1,669.10
Dividends payable 29,642.40 29,642.40
Reinsurance payables
Insurance contract reserve
Payables for acting trading of securities
Payables for underwriting of securities
Liabilities directly associated with assets
classified as held for sale
Current portion of non-current liabilities
Other current liabilities
Total current liabilities 2,425,060,370.12 2,416,223,746.31
Non-current liabilities:
Long-term borrowings 1,000,000.00
Bonds payable
Including: Preferred shares
Perpetual bonds
Long-term payables
Long-term payroll payable
Provisions
Deferred income
Deferred income tax liabilities 5,275.60 8,668.15
Other non-current liabilities 52,937,180.81 54,543,253.27
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total non-current liabilities 53,942,456.41 54,551,921.42
Total liabilities 2,479,002,826.53 2,470,775,667.73
Owners‘ equity:
Share capital 595,979,092.00 595,979,092.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 118,938,132.89 118,938,132.89
Less: Treasury stock
Other comprehensive income -1,786,181.69 -4,111,587.14
Specific reserve
Surplus reserves 299,569,569.96 299,569,569.96
General reserve
Retained earnings 2,325,248,711.48 1,911,318,586.37
Total equity attributable to owners of the
3,337,949,324.64 2,921,693,794.08
Company as the parent
Non-controlling interests 3,249,986.37 862,087.06
Total owners‘ equity 3,341,199,311.01 2,922,555,881.14
Total liabilities and owners‘ equity 5,820,202,137.54 5,393,331,548.87
Legal representative: Liu Shengxiang Head of financial affairs: Cai Lili
Head of the financial department: Liu Qiang
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item 31 December 2018 31 December 2017
Current assets:
Monetary capital 2,520,788,994.16 1,754,272,751.45
Financial assets at fair value through
profit or loss
Derivative financial assets
Notes and accounts receivable 1,853,494.72 479,462.50
Including: Notes receivable
Accounts receivable 1,853,494.72 479,462.50
Prepayments 829,683.68 496,729.09
Other receivables 1,306,715,826.93 1,128,977,669.02
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Including: Interest receivable 8,229,503.58
Dividends receivable
Inventories 105,840,115.24 303,797,408.60
Assets classified as held for sale
Current portion of non-current assets
Other current assets 85,558.19
Total current assets 3,936,028,114.73 3,188,109,578.85
Non-current assets:
Available-for-sale financial assets 3,851,881.11 3,821,709.20
Held-to-maturity investments
Long-term receivables
Long-term equity investments 239,501,956.17 250,613,065.89
Investment property 317,313,917.65 336,964,573.31
Fixed assets 9,121,637.65 8,163,838.55
Construction in progress
Productive living assets
Oil and gas assets
Intangible assets
R&D expense
Goodwill
Long-term prepaid expense 778,392.57 951,368.85
Deferred income tax assets 315,888,967.26 191,632,218.83
Other non-current assets 104,132,920.00
Total non-current assets 990,589,672.41 792,146,774.63
Total assets 4,926,617,787.14 3,980,256,353.48
Current liabilities:
Short-term borrowings
Financial liabilities at fair value through
profit or loss
Derivative financial liabilities
Notes and accounts payable 124,501,464.28 119,489,366.28
Advances from customers 75,895,087.75 5,127,871.19
Payroll payable 31,224,455.28 34,296,032.66
Taxes payable 1,402,388,742.76 704,897,740.79
Other payables 224,875,980.31 206,906,599.52
85
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Including: Interest payable
Dividends payable 29,642.40 29,642.40
Liabilities directly associated with assets
classified as held for sale
Current portion of non-current liabilities
Other current liabilities
Total current liabilities 1,858,885,730.38 1,070,717,610.44
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Long-term payables
Long-term payroll payable
Provisions
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 1,858,885,730.38 1,070,717,610.44
Owners‘ equity:
Share capital 595,979,092.00 595,979,092.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 92,326,467.62 94,057,859.68
Less: Treasury stock
Other comprehensive income
Specific reserve
Surplus reserves 298,912,759.52 298,912,759.52
Retained earnings 2,080,513,737.62 1,920,589,031.84
Total owners‘ equity 3,067,732,056.76 2,909,538,743.04
Total liabilities and owners‘ equity 4,926,617,787.14 3,980,256,353.48
3. Consolidated Income Statement
Unit: RMB
86
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Item 2018 2017
1. Revenue 2,787,240,632.53 2,904,690,690.53
Including: Operating revenue 2,787,240,632.53 2,904,690,690.53
Interest income
Premium income
Handling charge and
commission income
2. Costs and expenses 2,013,464,731.84 2,178,847,472.64
Including: Cost of sales 1,315,189,991.84 1,627,867,905.64
Interest expense
Handling charge and
commission expense
Surrenders
Net claims paid
Net amount provided as
insurance contract reserve
Expenditure on policy
dividends
Reinsurance premium
expense
Taxes and surcharges 613,426,966.17 463,876,115.22
Selling expense 46,501,225.18 31,179,193.33
Administrative expense 102,852,213.19 137,028,655.69
R&D expense
Finance costs -57,579,532.57 -24,407,456.38
Including: Interest
expense
Interest
58,627,284.65 25,827,011.83
income
Asset impairment loss -6,926,131.97 -56,696,940.86
Add: Other income
Investment income (―-‖ for loss) 1,889,021.11 106,874,030.32
Including: Share of profit or
1,268,890.28 1,978,501.84
loss of joint ventures and associates
Gain on changes in fair value (―-‖
for loss)
Foreign exchange gain (―-‖ for
loss)
87
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Asset disposal income (―-‖ for
-8,096.97 -11,772.11
loss)
3. Operating profit (―-‖ for loss) 775,656,824.83 832,705,476.10
Add: Non-operating income 4,859,143.80 1,759,894.83
Less: Non-operating expense 3,040,842.92 7,717,750.16
4. Profit before tax (―-‖ for loss) 777,475,125.71 826,747,620.77
Less: Income tax expense 184,813,373.69 203,784,886.40
5. Net profit (―-‖ for net loss) 592,661,752.02 622,962,734.37
5.1 Net profit from continuing
592,661,752.02 548,933,658.73
operations (―-‖ for net loss)
5.2 Net profit from discontinued
74,029,075.64
operations (―-‖ for net loss)
Net profit attributable to owners of
592,723,852.71 622,962,734.37
the Company as the parent
Net profit attributable to
-62,100.69 0.00
non-controlling interests
6. Other comprehensive income, net of
2,325,405.45 -3,414,038.44
tax
Attributable to owners of the
2,325,405.45 -3,414,038.44
Company as the parent
6.1 Items that will not be
reclassified to profit or loss
6.1.1 Changes caused by
remeasurements on defined benefit
pension schemes
6.1.2 Share of other
comprehensive income of investees that
will not be reclassified to profit or loss
under equity method
6.2 Items that may subsequently be
2,325,405.45 -3,414,038.44
reclassified to profit or loss
6.2.1 Share of other
comprehensive income of investees that
will be reclassified to profit or loss
under equity method
6.2.2 Gain/Loss on changes in
fair value of available-for-sale financial
assets
6.2.3 Gain/Loss arising from
reclassification of held-to-maturity
investments to available-for-sale
financial assets
88
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
6.2.4 Effective gain/loss on cash
flow hedges
6.2.5 Differences arising from
translation of foreign
2,325,405.45 -3,414,038.44
currency-denominated financial
statements
6.2.6 Other
Attributable to non-controlling
interests
7. Total comprehensive income 594,987,157.47 619,548,695.93
Attributable to owners of the
595,049,258.16 619,548,695.93
Company as the parent
Attributable to non-controlling
-62,100.69
interests
8. Earnings per share
8.1 Basic earnings per share 0.9945 1.0453
8.2 Diluted earnings per share 0.9945 1.0453
Where business combinations under common control occurred in the current period, the net profit achieved by the acquirees before
the combinations was RMB0.00, with the amount for last year being RMB0.00.
Legal representative: Liu Shengxiang Head of financial affairs: Cai Lili
Head of the financial department: Liu Qiang
4. Income Statement of the Company as the Parent
Unit: RMB
Item 2018 2017
1. Operating revenue 1,280,644,589.75 974,400,482.05
Less: Cost of sales 225,828,386.48 191,844,816.06
Taxes and surcharges 525,630,333.93 355,615,402.19
Selling expense 19,343,750.44 4,602,356.70
Administrative expense 47,578,406.12 67,072,041.58
R&D expense
Finance costs -54,255,168.19 -10,220,836.89
Including: Interest expense
Interest income 50,378,375.05 17,390,604.23
Asset impairment loss 47,377,759.48 1,250,188.43
Add: Other income
89
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Investment income (―-‖ for loss) 1,834,522.57 570,972,139.28
Including: Share of profit or
1,268,890.28 1,978,501.84
loss of joint ventures and associates
Gain on changes in fair value (―-‖
for loss)
Asset disposal income (―-‖ for
loss)
2. Operating profit (―-‖ for loss) 470,975,644.06 935,208,653.26
Add: Non-operating income 963,333.70 222,418.81
Less: Non-operating expense 711,102.23 7,030,356.88
3. Profit before tax (―-‖ for loss) 471,227,875.53 928,400,715.19
Less: Income tax expense 132,509,442.15 119,553,327.36
4. Net profit (―-‖ for net loss) 338,718,433.38 808,847,387.83
4.1 Net profit from continuing
338,718,433.38 718,383,636.46
operations (―-‖ for net loss)
4.2 Net profit from discontinued
90,463,751.37
operations (―-‖ for net loss)
5. Other comprehensive income, net of
tax
5.1 Items that will not be reclassified
to profit or loss
5.1.1 Changes in caused by
remeasurements on defined benefit
pension schemes
5.1.2 Share of other
comprehensive income of investees that
will not be reclassified to profit or loss
under equity method
5.2 Items that may subsequently be
reclassified to profit or loss
5.2.1 Share of other
comprehensive income of investees that
will be reclassified to profit or loss
under equity method
5.2.2 Gain/Loss on changes in fair
value of available-for-sale financial
assets
5.2.3 Gain/Loss arising from
reclassification of held-to-maturity
investments to available-for-sale
financial assets
90
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
5.2.4 Effective gain/loss on cash
flow hedges
5.2.5 Differences arising from
translation of foreign
currency-denominated financial
statements
5.2.6 Other
6. Total comprehensive income 338,718,433.38 808,847,387.83
7. Earnings per share
7.1 Basic earnings per share 0.5683 1.3572
7.2 Diluted earnings per share 0.5683 1.3572
5. Consolidated Cash Flow Statement
Unit: RMB
Item 2018 2017
1. Cash flows from operating activities:
Proceeds from sale of commodities
2,691,977,990.38 1,298,880,512.56
and rendering of services
Net increase in customer deposits and
interbank deposits
Net increase in borrowings from
central bank
Net increase in loans from other
financial institutions
Premiums received on original
insurance contracts
Net proceeds from reinsurance
Net increase in deposits and
investments of policy holders
Net increase in proceeds from
disposal of financial assets at fair value
through profit or loss
Interest, handling charges and
commissions received
Net increase in interbank loans
obtained
Net increase in proceeds from
repurchase transactions
Tax rebates
Cash generated from other operating
54,180,568.38 38,657,341.63
activities
91
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Subtotal of cash generated from
2,746,158,558.76 1,337,537,854.19
operating activities
Payments for commodities and
435,818,332.73 515,987,168.02
services
Net increase in loans and advances to
customers
Net increase in deposits in central
bank and in interbank loans granted
Payments for claims on original
insurance contracts
Interest, handling charges and
commissions paid
Policy dividends paid
Cash paid to and for employees 362,508,689.89 331,180,621.68
Taxes paid 731,616,830.74 746,485,110.50
Cash used in other operating
92,619,777.81 90,154,714.93
activities
Subtotal of cash used in operating
1,622,563,631.17 1,683,807,615.13
activities
Net cash generated from/used in
1,123,594,927.59 -346,269,760.94
operating activities
2. Cash flows from investing activities:
Proceeds from disinvestment
Investment income
Net proceeds from disposal of fixed
assets, intangible assets and other 115,072.54 11,700.85
long-lived assets
Net proceeds from disposal of
79,901,686.57 68,050,370.55
subsidiaries or other business units
Cash generated from other investing
activities
Subtotal of cash generated from
80,016,759.11 68,062,071.40
investing activities
Payments for acquisition of fixed
assets, intangible assets and other 17,185,136.22 3,721,869.38
long-lived assets
Payments for investments 100,000,000.00
Net increase in pledged loans granted
Net payments for acquisition of
subsidiaries and other business units
Cash used in other investing
92
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
activities
Subtotal of cash used in investing
117,185,136.22 3,721,869.38
activities
Net cash generated from/used in
-37,168,377.11 64,340,202.02
investing activities
3. Cash flows from financing activities:
Capital contributions received 2,450,000.00
Including: Capital contributions by
2,450,000.00
non-controlling interests to subsidiaries
Increase in borrowings obtained 1,000,000.00
Net proceeds from issuance of bonds
Cash generated from other financing
activities
Subtotal of cash generated from
3,450,000.00
financing activities
Repayment of borrowings
Payments for interest and dividends 178,793,727.60 107,246,594.16
Including: Dividends paid by
subsidiaries to non-controlling interests
Cash used in other financing
activities
Subtotal of cash used in financing
178,793,727.60 107,246,594.16
activities
Net cash generated from/used in
-175,343,727.60 -107,246,594.16
financing activities
4. Effect of foreign exchange rate
5,212.00 -3,550,248.56
changes on cash and cash equivalents
5. Net increase in cash and cash
911,088,034.88 -392,726,401.64
equivalents
Add: Cash and cash equivalents,
2,464,626,655.21 2,857,353,056.85
beginning of the period
6. Cash and cash equivalents, end of the
3,375,714,690.09 2,464,626,655.21
period
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item 2018 2017
1. Cash flows from operating activities:
Proceeds from sale of commodities
1,414,305,014.68 65,757,450.31
and rendering of services
Tax rebates
93
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Cash generated from other operating
43,112,205.17 21,716,848.94
activities
Subtotal of cash generated from
1,457,417,219.85 87,474,299.25
operating activities
Payments for commodities and
7,075,382.01 44,735,175.71
services
Cash paid to and for employees 38,651,894.17 21,174,100.46
Taxes paid 148,571,148.46 339,287,204.18
Cash used in other operating
246,528,170.36 272,205,006.82
activities
Subtotal of cash used in operating
440,826,595.00 677,401,487.17
activities
Net cash generated from/used in
1,016,590,624.85 -589,927,187.92
operating activities
2. Cash flows from investing activities:
Proceeds from disinvestment
Investment income 798,375,302.27
Net proceeds from disposal of fixed
assets, intangible assets and other 8,377.85
long-lived assets
Net proceeds from disposal of
73,001,849.11 88,010,664.30
subsidiaries or other business units
Cash generated from other investing
activities
Subtotal of cash generated from
73,001,849.11 886,394,344.42
investing activities
Payments for acquisition of fixed
assets, intangible assets and other 4,936,323.59 585,878.55
long-lived assets
Payments for investments 100,000,000.00 1,000,000.00
Net payments for acquisition of
39,351,392.06
subsidiaries and other business units
Cash used in other investing
activities
Subtotal of cash used in investing
144,287,715.65 1,585,878.55
activities
Net cash generated from/used in
-71,285,866.54 884,808,465.87
investing activities
3. Cash flows from financing activities:
Capital contributions received
Increase in borrowings obtained
94
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Net proceeds from issuance of bonds
Cash generated from other financing
activities
Subtotal of cash generated from
financing activities
Repayment of borrowings
Payments for interest and dividends 178,793,727.60 107,246,594.16
Cash used in other financing
activities
Sub-total of cash used in financing
178,793,727.60 107,246,594.16
activities
Net cash generated from/used in
-178,793,727.60 -107,246,594.16
financing activities
4. Effect of foreign exchange rate
5,212.00 -17,273.22
changes on cash and cash equivalents
5. Net increase in cash and cash
766,516,242.71 187,617,410.57
equivalents
Add: Cash and cash equivalents,
1,754,272,751.45 1,566,655,340.88
beginning of the period
6. Cash and cash equivalents, end of the
2,520,788,994.16 1,754,272,751.45
period
7. Consolidated Statements of Changes in Owners’ Equity
2018
Unit: RMB
2018
Equity attributable to owners of the Company as the parent
Other equity Non-co
Other Retaine Total
Item instruments Less: ntrollin
Share Capital compre Specific Surplus General d owners‘
Treasur g
Prefer Perpet equity
capital reserves hensive reserve reserves reserve earning
y stock interests
red ual Other
income s
shares bonds
1. Balances as at 595,97 1,911,3 2,922,5
118,938 -4,111,5 299,569 862,087
the end of the prior 9,092. 18,586. 55,881.
,132.89 87.14 ,569.96 .06
year 00 37 14
Add: Adjustments
for changed
accounting
policies
Adjustments for
corrections of
previous errors
95
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Adjustments for
business
combinations
under common
control
Other
adjustments
2. Balances as at 595,97 1,911,3 2,922,5
118,938 -4,111,5 299,569 862,087
the beginning of 9,092. 18,586. 55,881.
,132.89 87.14 ,569.96 .06
the year 00 37 14
3. Increase/
decrease in the 2,325,4 413,930 2,387,8 418,643
period (―-‖ for 05.45 ,125.11 99.31 ,429.87
decrease)
3.1 Total
2,325,4 592,723 -62,100. 594,987
comprehensive
05.45 ,852.71 69 ,157.47
income
3.2 Capital
2,450,0 2,450,0
increased and
00.00 00.00
reduced by owners
3.2.1
Ordinary shares 2,450,0 2,450,0
increased by 00.00 00.00
shareholders
3.2.2 Capital
increased by
holders of other
equity instruments
3.2.3
Share-based
payments included
in owners‘ equity
3.2.4 Other
-178,79 -178,79
3.3 Profit
3,727.6 3,727.6
distribution
0 0
3.3.1
Appropriation to
surplus reserves
3.3.2
Appropriation to
general reserve
3.3.3 -178,79 -178,79
96
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Appropriation to 3,727.6 3,727.6
owners (or 0 0
shareholders)
3.3.4 Other
3.4 Transfers
within owners‘
equity
3.4.1 Increase
in capital (or share
capital) from
capital reserves
3.4.2 Increase
in capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4
Changes in
defined benefit
pension schemes
transferred to
retained earnings
3.4.5 Other
3.5 Specific
reserve
3.5.1 Increase
in the period
3.5.2 Used in
the period
3.6 Other
4. Balances as at 595,97 2,325,2 3,341,1
118,938 -1,786,1 299,569 3,249,9
the end of the 9,092. 48,711. 99,311.
,132.89 81.69 ,569.96 86.37
period 00 48 01
2017
Unit: RMB
2017
Equity attributable to owners of the Company as the parent Non-co Total
Item
Share Other equity Capital Less: Other Specific Surplus General Retaine ntrollin owners‘
capital instruments reserves Treasur compre reserve reserves reserve d g equity
97
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Prefer Perpet y stock hensive earnings interest
red ual Other income s
shares bonds
1. Balances as at 595,97 1,441,6 2,411,2
119,951 -697,54 253,569 862,087
the end of the prior 9,092. 32,088. 96,822.
,533.93 8.70 ,569.96 .06
year 00 56 81
Add: Adjustments
for changed
accounting
policies
Adjustments for
corrections of
previous errors
Adjustments for
business
combinations
under common
control
Other
adjustments
2. Balances as at 595,97 1,441,6 2,411,2
119,951 -697,54 253,569 862,087
the beginning of 9,092. 32,088. 96,822.
,533.93 8.70 ,569.96 .06
the year 00 56 81
3. Increase/
decrease in the -1,013,4 -3,414,0 46,000, 469,686 511,259
period (―-‖ for 01.04 38.44 000.00 ,497.81 ,058.33
decrease)
3.1 Total
-3,414,0 622,962 619,548
comprehensive
38.44 ,734.37 ,695.93
income
3.2 Capital
increased and
reduced by owners
3.2.1
Ordinary shares
increased by
shareholders
3.2.2 Capital
increased by
holders of other
equity instruments
3.2.3
Share-based
98
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
payments included
in owners‘ equity
3.2.4 Other
-153,27 -107,27
3.3 Profit 46,000,
6,236.5 6,236.5
distribution 000.00
6 6
3.3.1
46,000, -46,000,
Appropriation to
000.00 000.00
surplus reserves
3.3.2
Appropriation to
general reserve
3.3.3
-107,27 -107,27
Appropriation to
6,236.5 6,236.5
owners (or
6 6
shareholders)
3.3.4 Other
3.4 Transfers
-1,013,4 -1,013,4
within owners‘
01.04 01.04
equity
3.4.1 Increase
in capital (or share
capital) from
capital reserves
3.4.2 Increase
in capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4
Changes in
defined benefit
pension schemes
transferred to
retained earnings
-1,013,4 -1,013,4
3.4.5 Other
01.04 01.04
3.5 Specific
reserve
3.5.1 Increase
in the period
99
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
3.5.2 Used in
the period
3.6 Other
4. Balances as at 595,97 1,911,3 2,922,5
118,938 -4,111,5 299,569 862,087
the end of the 9,092. 18,586. 55,881.
,132.89 87.14 ,569.96 .06
period 00 37 14
8. Statements of Changes in Owners’ Equity of the Company as the Parent
2018
Unit: RMB
2018
Other equity instruments Other
Less: Retaine Total
Item Share Capital comprehe Specific Surplus
Preferre Perpetu Treasury d owners‘
capital Other reserves nsive reserve reserves
d shares al bonds stock earnings equity
income
1. Balances as at 1,920,5
595,979, 94,057,85 298,912,7 2,909,538
the end of the prior 89,031.
092.00 9.68 59.52 ,743.04
year 84
Add: Adjustments
for changed
accounting
policies
Adjustments for
corrections of
previous errors
Other
adjustments
2. Balances as at 1,920,5
595,979, 94,057,85 298,912,7 2,909,538
the beginning of 89,031.
092.00 9.68 59.52 ,743.04
the year 84
3. Increase/
decrease in the -1,731,39 159,924 158,193,3
period (―-‖ for 2.06 ,705.78 13.72
decrease)
3.1 Total
338,718 338,718,4
comprehensive
,433.38 33.38
income
3.2 Capital
increased and
reduced by owners
3.2.1
Ordinary shares
increased by
100
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
shareholders
3.2.2 Capital
increased by
holders of other
equity instruments
3.2.3
Share-based
payments included
in owners‘ equity
3.2.4 Other
-178,79
3.3 Profit -1,731,39 -180,525,
3,727.6
distribution 2.06 119.66
0
3.3.1
Appropriation to
surplus reserves
3.3.2
-178,79
Appropriation to -178,793,
3,727.6
owners (or 727.60
0
shareholders)
3.3.3 Other
3.4 Transfers
within owners‘
equity
3.4.1 Increase
in capital (or share
capital) from
capital reserves
3.4.2 Increase
in capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4 Changes
in defined benefit
pension schemes
transferred to
retained earnings
-1,731,39 -1,731,39
3.4.5 Other
2.06 2.06
101
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
3.5 Specific
reserve
3.5.1 Increase
in the period
3.5.2 Used in
the period
3.6 Other
4. Balances as at 2,080,5
595,979, 92,326,46 298,912,7 3,067,732
the end of the 13,737.
092.00 7.62 59.52 ,056.76
period 62
2017
Unit: RMB
2017
Other equity instruments Other
Less: Retaine Total
Item Share Capital comprehe Specific Surplus
Preferre Perpetu Treasury d owners‘
capital Other reserves nsive reserve reserves
d shares al bonds stock earnings equity
income
1. Balances as at 1,265,0
595,979, 94,057,85 252,912,7 2,207,967
the end of the prior 17,880.
092.00 9.68 59.52 ,591.77
year 57
Add: Adjustments
for changed
accounting
policies
Adjustments for
corrections of
previous errors
Other
adjustments
2. Balances as at 1,265,0
595,979, 94,057,85 252,912,7 2,207,967
the beginning of 17,880.
092.00 9.68 59.52 ,591.77
the year 57
3. Increase/
decrease in the 46,000,00 655,571 701,571,1
period (―-‖ for 0.00 ,151.27 51.27
decrease)
3.1 Total
808,847 808,847,3
comprehensive
,387.83 87.83
income
3.2 Capital
increased and
reduced by owners
102
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
3.2.1
Ordinary shares
increased by
shareholders
3.2.2 Capital
increased by
holders of other
equity instruments
3.2.3
Share-based
payments included
in owners‘ equity
3.2.4 Other
-153,27
3.3 Profit 46,000,00 -107,276,
6,236.5
distribution 0.00 236.56
6
3.3.1
46,000,00 -46,000,
Appropriation to
0.00 000.00
surplus reserves
3.3.2
-107,27
Appropriation to -107,276,
6,236.5
owners (or 236.56
6
shareholders)
3.3.3 Other
3.4 Transfers
within owners‘
equity
3.4.1 Increase
in capital (or share
capital) from
capital reserves
3.4.2 Increase
in capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4 Changes
in defined benefit
pension schemes
transferred to
retained earnings
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
3.4.5 Other
3.5 Specific
reserve
3.5.1 Increase
in the period
3.5.2 Used in
the period
3.6 Other
4. Balances as at 1,920,5
595,979, 94,057,85 298,912,7 2,909,538
the end of the 89,031.
092.00 9.68 59.52 ,743.04
period 84
III Company Profile
1. Company profile
Shenzhen Properties & Resources Development (Group) Ltd. (hereinafter referred to as ―the Company‖ or ―Company‖) was
incorporated based on the reconstruction of Shenzhen Properties & Resources Development Co., Ltd. after obtaining approval of
ZFBF [1991] No. 831 from People‘s Government of Shenzhen Municipality. The registration number of Business License for
Enterprises as Legal Person is ZQFZ No. 440301103570124. And the credibility code for the Company after the business license
reform is 91440300192174135N. The registered capital of the Company was RMB541, 799,175 after bonus issue of shares on the
basis of one share for every existing 10 shares based on existing paid-in capital of the Company in 1996 and it changes to
RMB595,979,092 after bonus issue of shares on the basis of one share for every existing 10 shares based on previous paid-in capital
of RMB541,799,175 in 2009. As of 31 December 2018, the total share capital of the Company was 595,979,092 shares, among
which, 528,373,849 A shares, and 67,605,243 B shares.
Registered address: 39th and 42nd Floor, International Trade Center, Renmin South Road, Shenzhen.
Registration number of business entity: 91440300192174135N
Legal representative: Liu Shengxiang
2. Nature of the business, business scope and main products of the Company
The nature of business and business scope of the Company and its subsidiaries includes development of real estate and sale of
commercial housing, construction and management of buildings, house rent, supervision of construction, domestic trading and
materials supply and marketing (excluding exclusive dealing and monopoly sold products and commodities under special control to
purchase).
Main products or services rendered mainly include the development and sales of commercial residential housing; property
management; buildings and the building devices maintenance, garden afforest and cleaning service; property leasing; supervise and
management of the engineering; retails of the Chinese food, Western-style food and wines, and etc.
The parent company of the Company is Shenzhen Investment Holdings Co., Ltd., a solely state-funded limited company. As a
government department, Shenzhen State-owned Assets Supervision and Administration Bureau manages Shenzhen Investment
Holdings Co., Ltd. on behalf of People‘s Government of Shenzhen Municipality. Thus, the final controller of the Company is
Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen Government.
The financial statements were approved and authorized for issue by Board of the Directors on 29 March 2019. According to the
Articles of the Company, the financial statements will be submitted to General Meeting of Shareholders for review.
There were 22 subsidiaries included in the consolidation financial statements in 2018, and for details, please refer to Note VIII
―Equities among Other Entities‖ herein. There was 2 increased subsidiary in the consolidation scope as compared with last year, and
please refer to Notes VII. ―Changes in Consolidation Scope‖ for details.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
IV Basis for Preparation of Financial Statements
1. Preparation Basis
With the going-concern assumption as the basis and based on transactions and other events that actually occurred, the Group
prepared financial statements in accordance with The Accounting Standards for Business Enterprises—Basic Standard issued by the
Ministry of Finance with Decree No. 33 and revised with Decree No. 76, the 42 specific accounting standards, the Application
Guidance of Accounting Standards for Business Enterprises, the Interpretation of Accounting Standards for Business Enterprises and
other regulations issued and revised from 15 February 2006 onwards (hereinafter jointly referred to as ―the Accounting Standards for
Business Enterprises‖, ―China Accounting Standards‖ or ―CAS‖), as well as the Rules for Preparation Convention of Disclosure of
Public Offering Companies No.15 – General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory
Commission.
In accordance with relevant provisions of the Accounting Standards for Business Enterprises, the Group adopted the accrual basis in
accounting. Except for some financial instruments, the financial statements were based on historical costs for measurement. If
impairment occurred on an asset, an impairment reserve was withdrawn accordingly pursuant to relevant requirements.
2. Continuation
There will be no such events or situations in the 12 months from the end of this Reporting Period that will cause material doubts as to
the continuation capability of the Company.
V Important Accounting Policies and Estimations
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate.
Indication of specific accounting policies and estimations:
The Company and its subsidiaries engage in development of real estate, property leasing, property management, supervision of
construction, and catering services. The Company and each subsidiary according to the actual production and operation
characteristics and the regulations of the relevant ASBE, formulated certain specific accounting policies and accounting estimates of
the transactions and events such as recognizing the revenues, and please refer to the Note IV. 28 ―Revenue‖ for details. As for the
notes to the important accounting judgment and estimations made by the management level, please refer to the Note IV. 33. ―Other
important accounting policies and estimations‖ of the section.
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company are in compliance with in compliance with the Accounting Standards for Business
Enterprises, which factually and completely present the Company‘s, and the Company‘s financial positions as at 31 December 2018,
business results and cash flows for the year of 2018 and other relevant information. In addition, the Company‘s and the Company‘s
financial statements meet the requirements of disclosing financial statements and notes thereto stated in the Rules for Preparation
Convention of Disclosure of Public Offering Companies No.15 – General Regulations for Financial Reporting (revised in 2014) by
China Securities Regulatory Commission.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2. Fiscal Year
The Company‘s fiscal periods include fiscal years and fiscal periods shorter than a complete fiscal year. The Company‘s fiscal year
starts on 1 Jan. and ends on 31 Dec. of every year according to the Gregorian calendar.
3. Operating Cycle
A normal operating cycle refers to a period from the Group purchasing assets for processing to realizing cash or cash equivalents. As for
the construction of the real estate projects of the Group with rather long period, the normal operating period more than 1 year owning
to the industry characteristics, and although the relevant assets be discounted, sold or consumed more than 1 year, should still be
divided into the circulating assets; as for the operating liabilities projects during the normal operation period even be liquidated over 1
year after the balance sheet date, should be divided into the circulation liabilities. Besides, the normal operating period of other business
of the Group is shorter than 1 year. As for the normal operating period shorten than 1 year and the assets discounted since the balance
sheet date or the liabilities should be liquidated due within 1 year since the balance sheet date, should be classified as the current assets
or liabilities.
4. Recording Currency
Renminbi (RMB) is regarded as the prevailing currency used in the main economic circumstances of the Company and its domestic
subsidiaries. The Company and its domestic subsidiaries adopt RMB as the recording currency. The Hong Kong subsidiary of the
Company confirms the Hong Kong dollar as its recording currency according to the major economic environment of the currency of its
office place. When compiling the financial statements, the currency the Company adopted was the Renminbi.
5. Accounting Treatment for Business Combinations under the Common Control and Not under the
Common Control
Business combinations, it is refer to two or more separate enterprises merge to form a reporting entity transactions or events.
Business combination is divided into under the same control and those non under the same control.
(1) Business combinations under the same control
A business combination under the same control is a business combination in which all of the combining enterprises are ultimately
controlled by the same party or the same parties both before and after the business combination and on which the control is not
temporary. In a business combination under the same control, the party which obtains control of other combining enterprise(s) on the
combining date is the combining party, the other combining enterprise(s) is (are) the combined party. The ―combining date‖ refers to
the date on which the combining party actually obtains control on the combined party.
The assets and liabilities that the combining party obtains in a business combination shall be measured on the basis of their carrying
amount in the combined party on the combining date. As for the balance between the carrying amount of the net assets obtained by
the combining party and the carrying amount of the consideration paid by it (or the total par value of the shares issued), the additional
paid-in capital (share premium) shall be adjusted. If the additional paid-in capital (share premium) is not sufficient to be offset, the
retained earnings shall be adjusted.
The direct cost for the business combination of the combining party shall be recorded into the profits and losses at the current period.
(2) Business combinations not under the same control
A business combination not under the same control is a business combination in which the combining enterprises are not ultimately
controlled by the same party or the same parties both before and after the business combination. In a business combination not under
the same control, the party which obtains the control on other combining enterprise(s) on the purchase date is the acquirer, and other
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
combining enterprise(s) is (are) the acquiree.
For a business combination not under the same control, the combination costs shall include the fair values, on the acquisition date, of
the assets paid, the liabilities incurred or assumed and the equity securities issued by the acquirer in exchange for the control on the
acquiree, the expenses for audit, legal services and assessment, and other administrative expenses, which are recorded into the profits
and losses in the current period. The trading expenses for the equity securities or debt securities issued by the acquirer as the
combination consideration shall be recorded into the amount of initial measurement of the equity securities or debt securities. The
involved contingent consideration shall be recorded into the combination costs at its fair value on the acquiring date. Where new or
further evidences emerge, within 12 months since the acquiring date, against the existing circumstances on the acquiring date and the
contingent consideration thus needs to be adjusted, the combined goodwill shall be adjusted accordingly. The combination costs of
the acquirer and the identifiable net assets obtained by it in the combination shall be measured according to their fair values at the
acquiring date. The acquirer shall recognize the positive balance between the combination costs and the fair value of the identifiable
net assets it obtains from the acquiree as business reputation. Where the combination costs are less than the fair value of the
identifiable net assets it obtains from the acquiree, the acquirer shall re-examine the measurement of the fair values of the identifiable
assets, liabilities and contingent liabilities it obtains from the acquiree as well as the combination costs. If, after the reexamination,
the combination costs are still less than the fair value of the identifiable net assets it obtains from the acquiree, the acquirer shall
record the balance into the profits and losses of the current period.
As for the deductible temporary differences the acquirer obtains from the acquiree which are not recognized into deferred income tax
liabilities due to their not meeting the recognition standards, if new or further information shows that the relevant situation has
existed on the acquiring date and the economic benefits brought by the deductible temporary differences the acquirer obtains from
the acquiree on the acquiring date can be realized, they shall be recognized into deferred income tax assets and the relevant goodwill
shall be reduced. Where the goodwill is not sufficient to be offset, the difference shall be recognized into the profits and losses in the
current period. In other circumstances than the above, where the deductible temporary differences are recognized into deferred
income tax assets on the acquiring date, they shall be recorded into the profits and losses in the current period.
In a business combination not under same control realized by two or more transactions of exchange, according to about the 5 th Notice
about the Treasury Issuing the Accounting Standards for Enterprises (Finance accounting) [2012] No. 19 Criterion about the
―package deal‖ (see Notes IV. 5 (2)), Whether the deals are ―package deal‖ or not, belong to the ―package deal‖, see the previous
paragraphs described in this section and Notes IV. 14 ―Long term equity investment transaction‖ and conduct accounting treatment,
those not belong to the "package deal" distinguish between the individual financial statements and the consolidated financial
statements and conduct relevant accounting treatment.
In the individual financial statements, the sum of the book value and new investment cost of the Company holds in the acquiree
before the acquiring date shall be considered as initial cost of the investment. Other related comprehensive gains in relation to the
equity interests that the Company holds in the acquiree before the acquiring date shall be treated on the same basis as the acquiree
directly disposes the related assets or liabilities when disposing the investment (that is, except for the corresponding share in the
changes in the net liabilities or assets with a defined benefit plan measured at the equity method arising from the acquiree‘s
re-measurement, the others shall be transferred into current investment gains).
In the Company‘s consolidated financial statements, as for the equity interests that the Company holds in the acquiree before the
acquiring date, they shall be re-measured according to their fair values at the acquiring date; the positive difference between their fair
values and carrying amounts shall be recorded into the investment gains for the period including the acquiring date. Other related
comprehensive gains in relation to the equity interests that the Company holds in the acquiree before the acquiring date shall be
treated on the same basis as the acquiree directly disposes the related assets or liabilities when disposing the investment (that is,
except for the corresponding share in the changes in the net liabilities or assets with a defined benefit plan measured at the equity
method arising from the acquiree‘s re-measurement, the others shall be transferred into current investment gains on the acquiring
date).
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
6. Preparation of the Consolidated Financial Statements
(1) Principle for determining the consolidation scope
The consolidation scope for financial statements is determined on the basis of control. The term ―control‖ is the power of the
Company upon an investee, with which it can take part in relevant activities of the investee to obtain variable returns and is able to
influence the amount of returns. The consolidated financial statements comprise the financial statements of the Company and its
subsidiaries. A subsidiary is an enterprise or entity controlled by the Company.
If any changes in the relevant facts or situations result in any changes in the elements involved in the aforesaid definition of ―control‖,
the Company shall carry out a reassessment.
(2) Methods for preparing the consolidated financial statements
Subsidiaries are fully consolidated from the date on which the Company obtains control on their net assets and operation
decision-making and are de-consolidated from the date when such control ceases. As for a disposed subsidiary, its operating results
and cash flows before the disposal date has been appropriately included in the consolidated income statement and cash flow
statement; and as for subsidiaries disposed in the current period, the opening items in the consolidated balance sheet are not adjusted.
For a subsidiary acquired in a business combination not under the same control, its operating results and cash flows after the
acquiring date have been appropriately included in the consolidated income statement and cash flow statement, and the opening items
and comparative items in the consolidated financial statements are not adjusted. For a subsidiary acquired in a business combination
under the same control or a combined party obtained in a takeover, its operating results and cash flows from the beginning of the
Reporting Period of the combination to the combination date have been appropriately included in the consolidated income statement
and cash flow statement, and the comparative items in the consolidated financial statements are adjusted at the same time.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies and accounting period of the
Company during the preparation of the consolidated financial statements, where the accounting policies and the accounting periods
are inconsistent between the Company and subsidiaries. For a subsidiary acquired from a business combination not under the same
control, the individual financial statements of the subsidiary are adjusted based on the fair value of the identifiable net assets at the
acquisition date.
All significant inter-group balances, transactions and unrealized profits are offset in the consolidated financial statements.
The portion of a subsidiary‘s shareholders‘ equity and the portion of a subsidiary‘s net profits and losses for the period not held by the
Company are recognized as minority interests and minority shareholder profits and losses respectively and presented separately under
shareholders‘ equity and net profits in the consolidation financial statements. The portion of a subsidiary‘s net profits and losses for
the period that belong to minority interests is presented as the item of ―minority shareholder profits and losses‖ under the bigger item
of net profits in the consolidated financial statements. Where the loss of a subsidiary shared by minority shareholders exceeds the
portion enjoyed by minority shareholders in the subsidiary‘s opening owners‘ equity, minority interests are offset.
Where the Company losses control on its original subsidiaries due to disposal of some equity investments or other reasons, the
residual equity interests are re-measured according to the fair value on the date when such control ceases. The summation of the
consideration obtained from the disposal of equity interests and the fair value of the residual equity interests, minus the portion in the
original subsidiary‘s net assets measured on a continuous basis from the acquisition date that is enjoyable by the Company according
to the original shareholding percentage in the subsidiary, is recorded in investment gains for the period when the Company‘s control
on the subsidiary ceases. Other comprehensive incomes in relation to the equity investment in the original subsidiary are treated on
the same accounting basis as the acquiree directly disposes the relevant assets or liabilities (that is, except for the changes in the net
liabilities or assets with a defined benefit plan resulted from re-measurement of the original subsidiary, the rest shall all be transferred
into current investment gains) when such control ceases. And subsequent measurement is conducted on the residual equity interests
according to the No. 2 Accounting Standard for Business Enterprises —Long-term Equity Investments or the No. 22 Accounting
Standard for Business Enterprises—Recognition and Measurement of Financial Instruments. For details, see Notes IV. 14 ―Long
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Term Equity Investment‖ or Notes IV. 10 ―Financial Instruments‖.
Where the Company losses control on its original subsidiaries due to step by step disposal of equity investments through multiple
transactions, it need to distinguish the Group losses control on its subsidiaries due to disposal of equity investments whether belongs
to a package deal. All the transaction terms, conditions and economic impact of the disposal of subsidiaries‘ equity investment are in
accordance with one or more of the following conditions, which usually indicate the multiple transactions, should be considered as a
package deal for accounting treatment. ① These deals are at the same time or under the condition of considering the influence of
each other to concluded; ② These transactions only be as a whole can achieve a complete business result; ③ The occurrence of a
deal depends on at least one other transactions；④ A deal alone is not economical, it is economical with other trading together. Those
not belong to a package deal, each of them a deal depends on circumstances respectively conduct accounting treatment in accordance
with the applicable principles of ―part disposal of subsidiaries of a long-term equity investment under the condition of not losing
control on its subsidiaries‖ (see Notes IV. 13. (2) ④ in this section) and ―Where the Company losses control on its original
subsidiaries due to disposal of some equity investments or other reasons‖ (see the front paragraph) relevant transactions of the
Company losses control on its subsidiaries due to disposal of equity investments belonging to a package deal, considered as a
transaction and conduct accounting treatment. However, Before losing control, every disposal cost and corresponding net assets
balance of subsidiary of disposal investment are confirmed as other comprehensive income in consolidated financial statements,
which together transferred into the current profits and losses in the loss of control, when the Company losing control on its
subsidiary.
7. Classification of Joint Arrangements and Accounting Treatment of Joint Operations
A joint arrangement refers to an arrangement jointly controlled by two participants or above. The Company classifies joint
arrangements into joint operations and joint ventures according to its rights and duties in the joint arrangements. A joint operation
refers to a joint arrangement where the Group enjoys assets and has to bear liabilities related to the arrangement. A joint venture
refers to a joint arrangement where the Group is only entitled to the net assets of the arrangement.
The Company‘s investment in the joint venture shall accounted by using the equity method and treated in accordance with relevant
accounting policies described in Note IV. 14 (2) ②―Long-term equity investments accounted by using the equity method‖.
In terms of the joint operation involving the Company as a joint operator: recognizes the assets/liabilities held alone and the
assets/liabilities jointly held by recognizing according to the portion; recognizes the income from sale of the Company‘s share in the
output of the joint operation; recognizes the income from sale of the joint operation‘s outputs according to the Company‘s stake in it;
and recognizes the expense solely incurred to the Company and the expense incurred to the joint operation according to the
Company‘s stake in it.
When the Company, as a joint operator, transfers or sells assets (except for the assets constituting business, the same below) to the
joint operation, before the assets are sold to a third party, the Company only recognizes the share of the other joint operators in the
gains and losses arising from the sale. Where impairment occurs to the assets as prescribed in The Accounting Standard No. 8 for
Business Enterprises—Asset Impairment, the Company shall fully recognizes the loss resulting from the Company‘s transfer or sale
of the assets in relation to the joint operation; the Company shall recognizes the loss according to its stake in the joint operation for a
purchase of assets from the joint operation.
8. Confirmation Standard for Cash and Cash Equivalent
The term ―cash‖ refers to cash on hand and deposits that are available for payment at any time. The term ―cash equivalents‖ refers to
short-term (within 3 months from the purchase date) and highly liquid investments that are readily convertible to known amounts of
cash and which are subject to an insignificant risk of change in value.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
9. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements
(1) Accounting treatments for translation of foreign currency transactions
As for a foreign currency transaction, the Company shall convert the amount in a foreign currency into amount in its bookkeeping
base at the spot exchange rate (usually referring to the central parity rate announced by the People‘s Bank of China, the same below)
of the transaction date, while as for such transactions as foreign exchange or involving in foreign exchange, the Company shall
converted into amount in the bookkeeping base currency at actual exchange rate the transaction is occurred.
(2) Accounting treatments for translation of foreign currency monetary items and non-monetary items
On the balance sheet date, the foreign currency monetary items shall be translated at the spot exchange rate on the balance sheet date.
The exchange difference arising from it shall be recorded into current profit and loss.
A foreign currency non-monetary item measured at the historical costs shall still be translated at the spot exchange rate on the
transaction date. Where the foreign non-monetary items measured at the fair value shall be converted into amount in its bookkeeping
base currency at spot exchange rate, the exchange gains and losses arising thereof shall be treated as change in fair value, and
recorded into the current period gains and losses or as other comprehensive incomes.
(3) Translation of foreign currency financial statements
When it involves overseas business in preparing the consolidated financial statement, for the translation difference of foreign
currency monetary items of net investment in overseas business arising from the change in exchange rate, it shall be recorded into the
item of ―difference of foreign currency financial statement translation‖ under the owners‘ equity; and be recorded into disposal gains
and losses at current period when disposing overseas business.
The foreign currency financial statement of overseas business should be translated in to RMB financial statement by the following
methods: The asset and liability items in the balance sheets shall be translated at a spot exchange rate on the balance sheet date.
Among the owner‘s equity items, except for the items as ―undistributed profits‖, other items shall be translated at the spot exchange
rate at the time when they are incurred. The income and expense items in the profit statements shall be translated at the average spot
exchange rate at the period-begin and period-end of the transaction date. The undistributed profits at year-begin is the undistributed
profits at the end of last year after the translation; undistributed profits at year-end shall be listed as various distribution items after
the translation; after the translation, the balance between assets and the sum of liabilities and owners‘ equities shall be recorded into
other comprehensive gains and losses as difference of foreign currency translation. Where an enterprise disposes of an overseas
business without the control right, it shall shift the differences, which is presented under the items of the owner‘s equities in the
balance sheet and which arises from the translation of foreign currency financial statements relating to this overseas business, into the
disposal profits and losses of the current period by all or proportion of the disposed overseas business.
Foreign cash flow shall be translated at the average spot exchange rate at the period-begin and period-end of the date of cash flow
incurred. The influence of exchange rate on the cash flow shall be adjustment item and individually listed in the cash flow statement.
And the beginning balance and the actual balance of last year shall be listed at the amounts after translation of foreign currency
financial statement in last year.
Where the control of the Company over an overseas operation ceases due to disposal of all or some of the Company‘s owner‘s equity
in the overseas operation or other reasons, the foreign-currency statement translation difference belonging to the parent company‘s
owner‘s equity in relation to the overseas operation which is stated in the balance sheet shall be all restated as gains and losses of the
disposal period.
Where the Company‘s equity in an overseas operation decreases due to disposal of some equity investment or other reasons but the
Company still has control over the overseas operation, the foreign-currency statement translation difference in relation to the
disposed part of the overseas operation shall be recorded into minority interests instead of current gains and losses. If what‘s disposed
is some equity in an overseas associated enterprise or joint venture, the foreign-currency statement translation difference related to
the overseas operation shall be recorded into the gains and losses of the current period of the disposal according to the disposal ratio.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
10. Financial Instruments
The Company recognizes a financial asset or liability when it becomes a party of the relevant financial instrument contract. Financial
assets and liabilities are measured at fair value in initial recognition. As for the financial assets and liabilities measured at fair value
of which changes are recorded into current gains and losses, the relevant dealing expenses are directly recorded into gains and losses;
and the dealing expenses on other kinds of financial assets and liabilities are included in the amounts initially recognized.
(1) Determination of the fair value of main financial assets and financial liabilities
Fair value refers to the price that a market participant shall receive for selling an asset or shall pay for transferring a liability in an
orderly transaction on the measurement date. As for the financial assets or financial liabilities for which there is an active market, the
quoted prices in the active market shall be used to determine the fair values thereof. The quoted prices in the active market refers to
the prices available from stock exchange, broker‘s agencies, guilds, pricing organization and etc., which represent the actual trading
price under equal transaction. Where there is no active market for a financial instrument, the enterprise concerned shall adopt value
appraisal techniques, including the prices adopted by the parties, who are familiar with the condition, in the latest market transaction
upon their own free will, the current fair value obtained by referring to other financial instruments of the same essential nature, the
cash flow capitalization method and the option pricing model, etc., to determine its fair value.
(2) Classification, recognition and measurement of financial assets
The purchase and sale of financial assets under the normal ways shall be recognized and stopped to be recognized respectively at the
price of transaction date. Financial assets shall be classified into the following four categories when they are initially recognized: (a)
the financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the
current period, (b) the investments which will be held to their maturity; (c) loans and the account receivables; and (d) financial assets
available for sale.
① The financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of
the current period
Including transactional financial assets and the financial assets which are designated to be measured at their fair value and of which
the variation is recorded into the profits and losses of the current period;
The financial assets meeting any of the following requirements shall be classified as transactional financial assets：A. The purpose to
acquire the said financial assets is mainly for selling them in the near future; B. Forming a part of the identifiable combination of
financial instruments which are managed in a centralized way and for which there are objective evidences proving that the enterprise
may manage the combination by way of short-term profit making in the near future; C. Being a derivative instrument, excluding the
designated derivative instruments which are effective hedging instruments, or derivative instruments to financial guarantee contracts,
and the derivative instruments which are connected with the equity instrument investments for which there is no quoted price in the
active market, whose fair value cannot be reliably measured, and which shall be settled by delivering the said equity instruments.
The financial assets meeting any of the following requirements shall be designated as financial assets which are measured at their fair
values and the variation of which is recorded into the profits and losses of the current period for initial recognition: A. the designation
can eliminate or significantly reduce the difference of relevant gains and losses between recognition and measurement causing from
different bases for measurement of financial assets; B. The official written documents for risk management and investment strategies
of the enterprise have clearly stated that it shall, manage, evaluate and report to important management personnel based on the fair
value, about the group of financial assets which the financial assets are belong to or the financial assets and liabilities group.
A financial asset which is measured at their fair values with its variation recorded into the profits and losses of the current period is
subsequently measured at the fair value. The gains and losses arising from the fair value changes, as well as the dividend and interest
incomes from the financial asset, are recorded in the gains and losses for the current period.
② Held-to-maturity investment
The term "held-to-maturity investment" refers to a non-derivative financial asset with a fixed date of maturity, a fixed or
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
determinable amount of repo price and which the enterprise holds for a definite purpose or the enterprise is able to hold until its
maturity.
For the held-to-maturity investment adopting actual interest rate method, which is measured at the post-amortization costs, the profits
and losses that arise when such financial assets or financial liabilities are terminated from recognition, or are impaired or amortized,
shall be recorded into the profits and losses of the current period.
The actual interest rate method refers to the method by which the post-amortization costs and the interest incomes of different
installments or interest expenses are calculated in light of the actual interest rates of the financial assets or financial liabilities
(including a set of financial assets or financial liabilities). The actual interest rate refers to the interest rate adopted to cash the future
cash flow of a financial asset or financial liability within the predicted term of existence or within a shorter applicable term into the
current carrying amount of the financial asset or financial liability.
When the actual interest rate is determined, the future cash flow shall be predicted on the basis of taking into account all the
contractual provisions concerning the financial asset or financial liability (the future credit losses shall not be taken into account).and
also the various fee charges, trading expenses, premiums or reduced values, etc., which are paid or collected by the parties to a
financial asset or financial liability contract and which form a part of the actual interest rate.
③ Loans and the accounts receivables
Loans and the accounts receivables refer to non-derivative financial assets, which there is no quotation in the active market, with
fixed recovery cost or recognizable. Financial assets that are defined as loans and the accounts receivables by the Company including
notes receivables, accounts receivables, interest receivable, dividends receivable and other receivables etc..
Loans and the accounts receivables are made follow-up measurement on the basis of post-amortization costs employing the effective
interest method. Gains or loss arising from the termination recognition, impairment occurs or amortization shall be recorded into the
profits and losses of the current period.
④ Assets available for sales
Assets available for sales including non-derivative financial asset that has been assigned as assets available for sales on the initial
recognition and financial assets excluded those measured at fair value and of which the variation into profits and losses of the current
period, they are some financial assets, loans and accounts receivables, held-to-maturity investment.
The cost at the period-end of the available-for-sale liabilities instruments should be confirmed according to its amortized cost method,
that is the initially recognized amount which deduct the principal that had been repaid, to plus or minus the accumulative
amortization amount formed by the amortization between the difference of the initially recognized amount and the amount on the due
date that adopted the actual interest rate method, and at the same time deduct the amount after the impairment loss happened. The
cost at the period-end of the available-for-sale liabilities instruments is its initial cost.
Financial assets available-for-trade are subsequently measured at fair value, and gains or losses arising from changes in the fair value
are recognized as other comprehensive income，and be carried forward when the said financial assets stopped recognition, then it
shall be recorded into the profits and losses of the current period. But, the equity instrument investment which neither have quotation
in the active market nor its fair value could not be reliable measured, as well as the derivative financial assets that concern with the
equity instruments and should be settled through handing over to its equity instruments, should take the follow-up measurement
according to the cost.
Interest receive during the holding of assets available for sales and cash dividends with distribution announcement by invested
companies, it shall be recorded into the profits and losses of the current period.
(3) Impairment of financial assets
The Company assesses at the balance sheet date the carrying amount of every financial asset except for the financial assets that
measured by the fair value. If there is objective evidence indicating a financial asset may be impaired, a provision is provided for the
impairment.
The Company carries out a separate impairment test for every financial asset which is individually significant. As for a financial asset
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which is individually insignificant, an impairment test is carried out separately or in the financial asset group with similar credit risk.
Where the financial asset (individually significant or insignificant) is found not impaired after the separate impairment test, it is
included in the financial asset group with similar credit risk and tested again on the group basis. Where the impairment loss is
recognized for an individual financial asset, it is not included in the financial asset group with similar credit risk for an impairment
test.
① Impairment on held-to maturity investment, loans and receivables
The financial assets measured by cost or amortized cost write down their carrying value by the estimated present value of future cash
flow. The difference is recorded as impairment loss. If there is objective evidence to indicate the recovery of value of financial assets
after impairment, and it is related with subsequent event after recognition of loss, the impairment loss recorded originally can be
reversed. The carrying value of financial assets after impairment loss reversed shall not exceed the amortized cost of the financial
assets without provisions of impairment loss on the reserving date.
② Impairment of available-for-sale financial assets
When it judged that the decrease of fair value of the available-for-sale equity instrument investment is serious and not temporarily
after comprehensive considering relevant factors, it reflected that the available-for-sale equity instrument investment occurred
impairment. Of which, the ―serious decline‖ refers to the accumulative decline range of the fair value over 50%; while the
―non-temporary decline‖ refers to the consecutive decline time of the fair value over 12 months.
Where an available-for-sale financial asset is impaired, the accumulative losses arising from the decrease of the fair value of the
capital reserve which is directly included are transferred out and recorded in the profits and losses for the current period. The
accumulative losses transferred out are the balance obtained from the initially obtained cost of the said financial asset after deducting
the principals as taken back, the amortized amount, the current fair value and the impairment loss originally recorded in the profits
and losses.
Where the impairment loss has been recognized for an available-for-sale financial asset, if, within the accounting periods thereafter,
there is any objective evidence proving that the value of the said financial asset has been restored and the restoration is objectively
related to the events that occur after the impairment loss was recognized, the originally recognized impairment loss is reversed. The
impairment losses on the available-for-sale equity instrument investments are reversed and recognized as other comprehensive
incomes, and the impairment losses on the available-for-sale liability instruments are reversed and recorded in the profits and losses
for the current period.
The impairment loss incurred to an equity instrument investment for which there is no quoted price in the active market and whose
fair value cannot be reliably measured, or incurred to a derivative financial asset which is connected with the said equity instrument
investment and which must be settled by delivering the said equity investment, is not reversed.
(4) Recognition and measurement of financial asset transfers
Where a financial asset satisfies any of the following requirements, the recognition of it is terminated: ① The contractual rights for
collecting the cash flow of the said financial asset are terminated; ② The said financial asset has been transferred and nearly all of
the risks and rewards related to the ownership of the financial asset to the transferee; or ③ The said financial asset has been
transferred. And the Company has ceased its control on the said financial asset though it neither transfers nor retains nearly all of the
risks and rewards related to the ownership of the financial asset.
Where the Company neither transfers nor retains nearly all of the risks and rewards related to the ownership of a financial asset, and
it does not cease its control on the said financial asset, it recognizes the relevant financial asset and liability accordingly according to
the extent of its continuous involvement in the transferred financial asset. The term "continuous involvement in the transferred
financial asset" refers to the risk level that the enterprise faces resulting from the change of the value of the financial asset.
If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the difference between the amounts of the
following 2 items is recorded in the profits and losses of the current period: (1) The book value of the transferred financial asset; and
(2) The sum of consideration received from the transfer, and the accumulative amount of the changes of the fair value originally
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recorded in other comprehensive incomes.
If the transfer of partial financial asset satisfies the conditions to stop the recognition, the book value of the transferred financial asset
is apportioned between the portion whose recognition has been stopped and the portion whose recognition has not been stopped
according to their respective relative fair value, and the difference between the amounts of the following 2 items is included into the
profits and losses of the current period: (1) The summation of the consideration received from the transfer and the portion of the
accumulative amount of changes in the fair value originally recorded in other comprehensive incomes which corresponds to the
portion whose recognition has been stopped; and (2) The amortized carrying amounts of the aforesaid amounts.
In respect of the assets using recourse to sell or using endorsement to transfer, the Company needs to determine whether almost all of
the risks and rewards of the financial asset ownership are transferred. If almost all of the risks and rewards of the financial asset
ownership had been transferred to the transferee, derecognize the financial assets. For almost all of the risks and rewards of the
financial asset ownership retained, do not end to recognize the financial assets. For which neither transfer or retain almost all of the
risks and rewards of the financial asset ownership, continuously judge whether the Company retain the control of the assets, and
conduct accounting treatment according to the principle of mentioned in the previous paragraphs.
(5) Classification and measurement of financial liabilities
In the initial recognition, financial liabilities are divided into the financial liabilities measured at fair values and whose changes are
recorded in current gains and losses and other financial liabilities. Financial liabilities are initially recognized at their fair values. As
for a financial liability measured at fair value and whose changes are recorded in current gains and losses, the relevant trading
expense is directly recorded in the profits and losses for the current period. As for other financial liabilities, the relevant trading
expenses are recorded in the initially recognized amounts.
① Financial liabilities measured at fair values and whose changes are recorded in current gains and losses
Such financial liabilities are divided into transactional financial liabilities and financial liabilities designated to be measured at fair
values and whose changes are recorded in current gains and losses in the initial recognition under the same conditions where such
financial assets are divided into transactional financial assets and financial assets designated to be measured at fair values and whose
changes are recorded in current gains and losses in the initial recognition.
Financial liabilities measured at fair values and whose changes are recorded in current gains and losses are subsequently measured at
their fair values. Gains or losses arising from the fair value changes, as well as the dividend and interest expenses in relation to the
said financial liabilities, are recorded in the profits and losses for the current period.
② Other financial liabilities
As for a derivative financial liability connected to an equity instrument for which there is not quoted price in an active market and
whose fair value cannot be reliably measured and which must be settled by delivering the equity instrument, it is subsequently
measured on the basis of costs. Other financial liabilities are subsequently measured according to the amortized cost using the actual
interest rate method. Gains or losses arising from de-recognition or amortization of the said financial liabilities is recorded in the
profits and losses for the current period.
(6) De-recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the financial liability
be terminated in all or partly. Where the Company (debtor) enters into an agreement with a creditor so as to substitute the existing
financial liabilities by way of any new financial liability, and if the contractual stipulations regarding the new financial liability is
substantially different from that regarding the existing financial liability, it terminates the recognition of the existing financial liability,
and at the same time recognizes the new financial liability.
Where the recognition of a financial liability is totally or partially terminated, the enterprise concerned shall include into the profits
and losses of the current period for the gap between the book value which has been terminated from recognition and the
considerations it has paid (including the non-cash assets it has transferred out and the new financial liabilities it has assumed)
(7) Offsetting financial assets and financial liabilities
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When the Company has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities,
and intends either to settle on a net basis, or to realize the financial asset and settle the financial liability simultaneously, a financial
asset and a financial liability shall be offset and the net amount is presented in the balance sheet. Except for the above circumstances,
financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset.
11. Notes and Accounts Receivable
(1) Accounts Receivable with Significant Single Amount for Which the Bad Debt Provision is Made
Individually
Receivables with the amount of more than RMB2 million
Judgement basis or monetary standards of provision for bad
(including RMB2 million) should recognize as the receivables
debts of the individually significant accounts receivable
with significant single amount.
The Company made an independent impairment test on
receivables with significant single amounts; the financial assets
without impairment by independent impairment test should be
Method of individual provision for bad debts of the individually
included in financial assets portfolio with similar credit risk to
significant accounts receivable
take the impairment test. Receivables was recognized with
impairment should no longer be included in receivables portfolio
with similar credit risk to take the impairment test.
(2) Accounts Receivable Which the Bad Debt Provision is Withdrawn by Credit Risk Characteristics
Name of portfolios Bad debt provision method
Portfolios 1 (accounts receivable among the companies within
Other method
the consolidated scope of the Group)
Portfolios 2 (accounts receivable except for the accounts
receivable in the consolidation scope which had not been
impaired after the independent test, and the Company analyzed
and recognized the ratio of the withdrawal of the bad debt
provision combined with the current situation and based on the Aging analysis method
actual losses rate of the accounts receivable group which
possessed the similar credit risk characteristics divided according
to the aging phase that were the same as or similar to the
previous years)
In the groups, adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Not applicable
Withdrawal proportion for accounts Withdrawal proportion for other accounts
Age
receivable receivable
Within 1 year (including 1 year) 3.00% 3.00%
1-2 years 10.00% 10.00%
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2-3 years 30.00% 30.00%
3-4 years 50.00% 50.00%
4-5 years 80.00% 80.00%
Over 5 years 100.00% 100.00%
In the groups, adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Not applicable
In the groups, adopting other methods to withdraw bad debt provision:
√ Applicable □ Not applicable
Withdrawal proportion for accounts Withdrawal proportion for other accounts
Name of portfolios
receivable receivable
Portfolio 1 0.00% 0.00%
(3) Accounts Receivable with an Insignificant Single Amount but for which the Bad Debt Provision is Made
Independently
The Group made independent impairment test on receivables
Reason of individually withdrawing bad debt provision with insignificant amount but with special impairment indicated
by objective evidence.
The Company made independent impairment test on receivables
with insignificant amount but with the following characteristics,
if any objective evidence shows that the accounts receivable has
Withdrawal method for bad debt provision been impaired, impairment loss shall be recognized on the basis
of the gap between the current values of the future cash flow
lower than its book value so as to withdraw provision for bad
debts
12. Inventory
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
(1) Classification
Inventories include raw materials, revolving materials, finished products, stock products, land intended to develop, development
products in construction (development costs), completed development products and development products intended to sell but rent
temporarily, and etc. the costs of development products include land-transferring fees, expenditures of basic supporting facilities and
building installation engineering, borrowing costs incurred before the completion of development project, and other related costs in
the process of the development. When the inventories are delivered, it‘s actual costs shall be recognized by specific identification.
(2) Valuation method of inventories acquiring and issuing
Inventories shall be priced at actual cost when acquired, and they shall be initially measured at costs. When inventories are delivered,
the materials are priced by weighted average costs, and development products are priced by specific identification.
(3) Basis for determining net realizable value of inventories and provision methods for decline in value of inventories
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Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion, the
estimated costs necessary to make the sale and relevant taxes. Net realizable value is determined on the basis of clear evidence
obtained, and takes into consideration the purpose of holding inventories and effect of post balance sheet events.
At the balance sheet date, inventories are measured at the lower of the cost and net realizable value. If the net realizable value is
below the cost of inventories, a provision for decline in value of inventories is made. The provision for inventories decline in value is
determined by the difference of the cost of individual item less its realizable value. For inventory that has large quantity and low unit
price, the provision for inventory devaluation is provided for based on categories of the inventory. For inventory related to the
products manufactured and sold in the same district, with same or similar use or purpose, and difficult to account for separately from
other items, the provision for inventory devaluation is provided for on a consolidated basis.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories to be written
down below cost no longer exist so that the net realizable value of inventories is higher than their cost, the original provision for
decline in value is reversed and the reversal is included in profit or loss for the period.
(4) The perpetual inventory system is maintained for stock system.
(5) Amortization method of the low-value consumption goods and packing articles
(6) Accounting Method Applied to Lands for Development
For pure land development projects, all resulting costs and expenses shall individually constitute the land development costs;
For projects linked with the real estate for overall development, when the party supposed to assume all resulting expenses can be
defined, such expenses shall be amortized into the commercial housing costs based on the actual area.
(7) Accounting of Costs of Public Facilities
It shall be calculated into the work in progress based on the actual completion cost (if the corresponding public facilities have not
been completed when the real estate project is completed, it will be included in the completed development products according to the
estimated cost); if a supporting facility can benefit from multiple supporting real estate projects and the developed products are of the
same type, it shall be apportioned according to the saleable area; if a supporting facility can benefit from multiple supporting real
estate projects and the developed products are not of the same type (for example, common residence and villas are developed at the
same time), it shall be apportioned according to the floor space ratio.
(8) Accounting Method of Maintenance Fund
For the Company‘s property management business, the public maintenance fund received from the owners under the Company‘s
management shall be included in the long-term account payable specially used for the maintenance and renewal of public facilities in
the residential common facilities and property management areas.
(9) Accounting Method of Quality Guarantee Deposit
It shall be included in the completed development product costs based on the amount stipulated in the contract, and calculated into
the accounts payable for future actual payment after the guarantee period expires.
13. Assets Held for Sale
The Company classifies an asset into held-for-sale when its book value is mainly recovered by selling (including the exchanges of
non-monetary assets with commercial substance) instead of a non-current asset or disposal group. Specific standards are
simultaneously satisfying the following conditions: A asset or disposal group can be sold immediately under current conditions based
on the practice of selling such assets or disposal groups in similar transactions; the Company has already made a resolution on sale
plan and obtained a confirmed purchase commitment; and the sale is expected to will be completed within one year. A disposal group
refers to a group of assets that are disposed of together as a whole by sale or other means in a transaction and the liabilities directly
related to these assets transferred in the transaction. Where the asset group or combination of asset groups to which a disposal group
belongs apportions the goodwill acquired in the business combination in accordance with the "Accounting Standards for Enterprises
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No. 8 - Asset Impairment", the disposal group shall include the goodwill allocated to it.
When the Company initially measures or re-measures on the balance sheet date the non-current assets and disposal groups classified
as held-for-sale, If the book value is higher than the fair value minus the net amount of the sale costs, the book value will be written
down to the net amount of fair value minus the sale costs, and the amount written down will be recognized as impairment loss of
assets and included in the current profit and loss, and provision for impairment of held-for-sale assets will be made at the same time.
For the confirmed amount of impairment loss of assets of the disposal groups held for sale, the book value of goodwill of the disposal
groups will be offset first, and then the book value of various non-current assets applicable to the measurement of Accounting
Standards for Business Enterprises No. 42 - Non-current Assets and Disposal Groups Held for Sale and Termination of Operations
(hereinafter referred to as ―Held for sale standards‖) in the disposal groups will be offset according to the proportions. If the net
amount that the fair value of the disposal groups held for sale on the follow-up balance sheet date minus the sale costs increases, the
previous written-down amount will be restored, and reversed to the asset impairment loss confirmed after the assets being classified
as held-for-sale. The reversed amount will be included in the current profit or loss. And its book value shall be increased
proportionately to the proportion of the book value of various non-current assets measured by the disposal group in addition to
goodwill applicable to the measurement of held-for-sale norms; The book value of deducted goodwill and the non-current assets
applicable to the measurement of held-for-sale norms will not be reversed if the asset impairment loss is recognized before it is
classified as held for sale.
Non-current assets held for sale or non-current assets in the disposal group are not subject to depreciation or amortization. Interest
and other expenses of liabilities in the disposal group held for sale will be confirmed as before.
When a non-current asset or disposal group ceases be classified as held-for-sale or a non-current asset is removed out from the
held-for-sale disposal group due to failure in meeting the classification conditions for the category of held-for-sale, it will be
measured by one of the followings whichever is lower: (1) The book value before being classified as held for sale will be adjusted
according to the depreciation, amortization or impairment that would have been recognized under the assumption that it was not
classified as held for sale; (2) The recoverable amount.
14. Long-term Equity Investments
The long-term equity investments of this part refer to the long-term equity investments that the Company has control, joint control or
significant influence over the investees. The long-term equity investment that the Company does not have control, joint control or
significant influence over the investees, should be recognized as available-for-sale financial assets or be measured by fair value with
the changes should be included in the financial assets accounting of the current gains and losses, and please refer the details of the
accounting policies to Notes IV. 10 ―Financial instrument‖
Joint control, refers to the control jointly owned according to the relevant agreement on an arrangement by the Company and the
relevant activities of the arrangement should be decided only after the participants which share the control right make consensus.
Significant influence refers to the power of the Company which could anticipate in the finance and the operation polices of the
investees, but could not control or jointly control the formulation of the policies with the other parties.
(1) Recognition of investment costs
As for long-term equity investments acquired by enterprise merger, if the merger is under the same control, the share of the book
value of the owner‘s equity of the merged enterprise, on the date of merger, is regarded as the initial cost of the long-term equity
investment. The difference between the initial cost of the long-term equity investment and the payment in cash, non-cash assets
transferred as well as the book value of the debts borne by the merging party shall offset against the capital reserve. If the capital
reserve is insufficient to dilute, the retained earnings shall be adjusted. If the consideration of the merging enterprise is that it issues
equity securities, it shall, on the date of merger, regard the share of the book value of the shareholder's equity of the merged
enterprise on the consolidated financial statement of the ultimate control party as the initial cost of the long-term equity investment.
The total face value of the stocks issued shall be regarded as the capital stock, while the difference between the initial cost of the
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long-term equity investment and total face value of the shares issued shall offset against the capital reserve. If the capital reserve is
insufficient to dilute, the retained earnings shall be adjusted. The equities of the combined party which respectively acquired through
multiple transaction under the same control that ultimately form into the combination of the enterprises under the same control,
should be disposed according whether belongs to package deal; if belongs to package deal, each transaction would be executed
accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package deal, it shall, on the
date of merger, regard the enjoyed share of the book value of the shareholder's equity of the merged enterprise on the consolidated
financial statement of the ultimate control party as the initial cost of the long-term equity investment, and as for the difference
between the initial investment cost of the long-term equity investment and sum of the book value of the long-term equity investment
before the combination and the book value of the consideration of the new payment that further required on the combination date,
should adjust the capital reserve; if the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. The equity
investment held before the combination date which adopted the equity method for accounting, or the other comprehensive income
confirmed for the available-for-sale financial assets, should not have any accounting disposal for the moment.
For the long-term investment required from the business combination under different control, the initial investment cost regarded as
long-term equity investment on the purchasing date according to the combination cost, the combination costs shall be the sum of the
fair values of the assets paid, the liabilities incurred or assumed and the equity securities issued by the Company. The equities of the
acquirees which respectively acquired through multiple transaction that ultimately form into the combination of the enterprises under
the different control, should be disposed according whether belongs to package deal; if belongs to package deal, each transaction
would be executed accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package
deal, the sum of the book value of the original held equity investment of the acquirees and the newly added investment cost should be
regarded as the initial investment cost of the long-term equity investment that changed to be accounted by cost method. If the original
held equity is calculated by cost method, the other relevant comprehensive income would not have any accounting disposal for the
moment. If the original held equity investment is the financial assets available for sale, its difference between the fair value and the
book value as well as the accumulative changes of the fair value that include in the other comprehensive income, should transfer into
the current gains and losses.
The commission fees for audit, law services, assessment and consultancy services and other relevant expenses occurred in the
business combination by the combining party or the purchase party, shall be recorded into current profits and losses upon their
occurrence.
Besides the long-term equity investments formed by business combination, the other long-term equity investments shall be initially
measured by cost, the cost is fixed in accordance with the ways of gaining, such as actual cash payment paid by the Company, the
fair value of equity securities issued by the Company, the agreed value of the investment contract or agreement, the fair value or
original carrying amount of exchanged assets from non-monetary assets exchange transaction, the fair value of the long-term equity
investments, etc. The expenses, taxes and other necessary expenditures directly related with gaining the long-term equity investments
shall also be recorded into investment cost. The long-term equity investment cost for those could execute significant influences on
the investees because of appending the investment or could execute joint control but not form as control, should be as the sum of the
fair value of the original held equity investment and the newly added investment cost recognized according to the No. 22 of
Accounting Standards for Business Enterprises—Recognition and Measurement of Financial Instrument.
(2) Subsequent measurement and recognition of gains or losses
A long-term equity investment where the investing enterprise has joint control (except for which forms into common operators) or
significant influence over the investors should be measured by equity method. Moreover, long-term equity investment adopting the
cost method in the financial statements, and which the Company has control on invested entity.
① Long-term equity investment measured by adopting cost method
The price of a long-term equity investment measured by adopting the cost method shall be included at its initial investment cost and
append as well as withdraw the cost of investing and adjusting the long-term equity investment. The return on investment at current
period shall be recognized in accordance with the cash dividend or profit announced to distribute by the invested entity, except the
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announced but not distributed cash dividend or profit included in the actual payment or consideration upon gaining the investment.
② Long-term equity investment measured by adopting equity method
If the initial cost of a long-term equity investment is more than the Company's attributable share of the fair value of the invested
entity's identifiable net assets for investment, the initial cost of the long-term equity investment may not be adjusted. If the initial cost
of a long-term equity investment is less than the Company's attributable share of the fair value of the invested entity's identifiable net
assets for the investment, the difference shall be included in the current profits and losses and the cost of the long-term equity
investment shall be adjusted simultaneously.
When measured by adopting equity method, respectively recognize investment income and other comprehensive income according to
the net gains and losses as well as the portion of other comprehensive income which should be enjoyed or be shared, and at the same
time adjust the book value of the long-term equity investment; corresponding reduce the book value of the long-term equity
investment according to profits which be declared to distribute by the investees or the portion of the calculation of cash dividends
which should be enjoyed; for the other changes except for the net gains and losses, other comprehensive income and the owners‘
equity except for the profits distribution of the investees, should adjust the book value of the long-term equity investment as well as
include in the capital reserve. The investing enterprise shall, on the ground of the fair value of all identifiable assets of the invested
entity when it obtains the investment, recognize the attributable share of the net profits and losses of the invested entity after it
adjusts the net profits of the invested entity. If the accounting policy adopted by the investees is not accord with that of the Company,
should be adjusted according to the accounting policies of the Company and the financial statement of the investees during the
accounting period and according which to recognize the investment income as well as other comprehensive income. For the
transaction happened between the Company and associated enterprises as well as joint ventures, if the assets launched or sold not
form into business, the portion of the unrealized gains and losses of the internal transaction, which belongs to the Company according
to the calculation of the enjoyed proportion, should recognize the investment gains and losses on the basis. But the losses of the
unrealized internal transaction happened between the Company and the investees which belongs to the impairment losses of the
transferred assets, should not be neutralized. The assets launched by the Company to the associated enterprises or the joint ventures if
could form into business, the long-term equity investment without control right which acquired by the investors, should regard the
fair value of the launched business as the initial investment cost the newly added long-term equity investment, and for the difference
between the initial investment cost and the book value of the launched business, should be included into the current gains and losses
with full amount. The assets sold by the Company to the associated enterprises or the joint ventures if could form into business, the
difference between the acquired consideration and the book value of the business should be included in the current gains and losses
with full amount. The assets purchased by the Company to the associated enterprises or the joint ventures if could form into business,
should be accounting disposed according to the regulations of No. 20 of ASBE—Business Combination, and should be recognized
gains or losses related to the transaction with full amount.
The Company shall recognize the net losses of the invested enterprise until the book value of the long-term equity investment and
other long-term rights and interests which substantially form the net investment made to the invested entity are reduced to zero.
However, if the Company has the obligation to undertake extra losses, it shall be recognized as the estimated liabilities in accordance
with the estimated duties and then recorded into investment losses at current period. If the invested entity realizes any net profits later,
the Company shall, after the amount of its attributable share of profits offsets against its attributable share of the un-recognized losses,
resume recognizing its attributable share of profits.
For the long-term equity investment held by the Company before the first execution of the new accounting criterion of the associated
enterprises and joint ventures, if there is debit difference of the equity investment related to the investment, should be included in the
current gains and losses according to the amount of the straight-line amortization during the original remained period.
③ Acquiring shares of minority interest
In the preparation for the financial statements, the balance existed between the long-term equity investment increased by acquiring
shares of minority interest and the attributable net assets on the subsidiary calculated by the increased shares held since the purchase
date (or combination date), the capital reserves shall be adjusted, if the capital reserves are not sufficient to offset, the retained profits
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shall be adjusted.
④ Disposal of long-term equity investment
In the preparation of financial statements, the Company disposed part of the long-term equity investment on subsidiaries without
losing its controlling right on them, the balance between the disposed price and attributable net assets of subsidiaries by disposing the
long-term equity investment shall be recorded into owners‘ equity; where the Company losses the controlling right by disposing part
of long-term equity investment on such subsidiaries, it shall treated in accordance with the relevant accounting policies in Notes IV. 5.
(2) ―Method on preparation of combined financial statements‖.
For other ways on disposal of long-term equity investment, the balance between the book value of the disposed equity and its actual
payment gained shall be recorded into current profits and losses.
For the long-term equity investment measured by adopting equity method, if the remained equity after disposal still adopts the equity
method for measurement, the other comprehensive income originally recorded into owners‘ equity should adopt the same basis of the
accounting disposal of the relevant assets or liabilities directly disposed by the investees according to the corresponding proportion.
The owners‘ equity recognized owning to the changes of the other owners‘ equity except for the net gains and losses, other
comprehensive income and the profits distribution of the investees, should be transferred into the current gains and losses according
to the proportion.
For the long-term equity investment which adopts the cost method of measurement, if the remained equity still adopt the cost method,
the other comprehensive income recognized owning to adopting the equity method for measurement or the recognition and
measurement standards of financial instrument before acquiring the control of the investees, should adopt the same basis of the
accounting disposal of the relevant assets or liabilities directly disposed by the investees and should be carried forward into the
current gains and losses according to the proportion; the changes of the other owners‘ equity except for the net gains and losses, other
comprehensive income and the profits distribution among the net assets of the investees which recognized by adopting the equity
method for measurement, should be carried forward into the current gains and losses according to the proportion.
If the Company loses control over the investee due to disposal of partial equity investment, in the preparation of individual financial
statements, if the remaining equity after such disposal can be applied to exercise joint control or exert significant influence on the
investee, it shall be calculated by using the equity method. The remaining equity shall be deemed to be adjusted by equity method
when it is acquired; if the remaining equity after disposal cannot be applied to exercise joint control over or exert significant
influence on the investee, it shall be calculated according to various provisions related to financial instrument recognition and
measurement criteria. The difference between the fair value and the book value on the date of loss of control is recognized in profit or
loss for the period. Before the Company obtains control over the investee, other comprehensive incomes recognized and calculated
by using the equity method or according to the financial instrument recognition and measurement criteria shall be subject to the
accounting treatment by adopting the same accounting basis with that applied by the investee to directly dispose relevant assets or
liabilities when the control over the investee is lost. The changes in the owner‘s equity other than the net profit or loss, other
comprehensive income and profit distribution in the net assets of the investee recognized by using the equity method shall be carried
forward into the current profit or loss. Where the remaining equity after disposal is calculated by using the equity method, other
comprehensive incomes and other owner‘s equities shall be carried forward on a pro-rata basis; if the remaining equity after disposal
adopts corresponding accounting treatment based on the financial instrument recognition and measurement criteria, other
comprehensive incomes and other owner‘s equities shall be carried forward.
If the Company loses its joint control over or significant influence on the investee due to the disposal of partial equity investment, the
remaining equity after disposal shall be subject to the financial instrument recognition and measurement criteria for accounting, and
the difference between the fair value and the book value on the day of loss of joint control or significant influence shall be included
in the current profit and loss. In the original equity investment, other comprehensive incomes recognized by using the equity method
shall be subject to the accounting treatment on the same basis with that applied by the investee to directly dispose related assets or
liabilities when the equity method is discontinued for accounting. The owner‘s equity recognized due to the changes of other owner‘s
equities of the investee other than the net profit or loss, other comprehensive incomes and profit distribution shall be all carried
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forward to the current income on investment when the equity method is discontinued for accounting.
If the Company disposes the equity investment in the subsidiaries step by step by means of multiple transactions till the loss of
control, and such transactions are part of the package transaction, such transactions shall be treated as a transaction in relation to the
equity investment of the subsidiary with the lost control right. The difference between the disposal price and the book value of the
long-term equity investment corresponding to the disposed equity before the loss of control shall be firstly recognized as other
comprehensive incomes, and then carried forward to the current profit or loss when the control is lost.
15. Investment Real Estate
Measurement model of investment real estate
Costing method measurement
Depreciation or amortization method
The investment real estate refers to the real estate gaining the rent or capital appreciation or both. It includes rented land use right,
holding land use right to be transferred after the appreciation and rented building, etc.
The investment real estate is measured initially according to the cost. The subsequent expenses related with the investment real estate
shall be calculated into the cost of investment real estate if the economic benefit related with the asset may flow in and the cost may
be measured reliably. Other subsequent expenses shall be calculated in the current profits and losses at the occurrence.
The Company adopts the cost mode to conduct the subsequent measurement on the investment real estate, depreciates or amortizes
according to the policy consistent with the house building or land use right.
The devaluation test method and devaluation provision method for the investment real estate can be seen in Notes IV. 22 ―Long-term
Asset Devaluation‖.
When the self-use real estate or stock is converted to the investment real estate or the investment real estate is converted to the
self-use real estate, the book value before the conversion shall be the entry value after the conversion.
When the purpose of investment real estate is changed into private use, the investment real estate shall be converted into the fixed
assets or intangible assets from the date of change. When the purpose of the self-use real estate is changed for earning rents or for
capital appreciation, the fixed assets or intangible assets shall be converted into the investment real estate from the date of change. If
it is converted to the investment real estate measured by the cost model, the book value before such conversion shall be used as the
entry value after such conversion; if it is converted into the investment real estate measured by the fair value model, the fair value on
the conversion date shall be used as the entry value after such conversion.
When the investment real estate is disposed, or out of usage permanently, and it is expected not to get the economic benefit from the
disposal, the confirmation on the investment real estate shall be terminated. The disposal income for the sales, transferring, scrap or
damage of the investment real estate deducing the book value and related tax shall be calculated in the current profits and losses.
16. Fixed Assets
(1) Conditions for Recognition
The term ―fixed assets‖ refers to the tangible assets that simultaneously possess the features as follows: (a) they are held for the sake
of producing commodities, rendering labor service, renting or business management; and (b) their useful life is in excess of one fiscal
year. The fixed assets are only recognized when the relevant economic benefits probably flow in the Company and its cost could be
reliable measured. The fixed assets should take the initial measurement according to the cost and at the same time consider the
influences of the factors of the estimated discard expenses.
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(2) Depreciation Methods
Category of fixed assets Method Useful life Salvage value Annual deprecation
Average method of
Housing and building 20-25 5-10% 3.8-4.5
useful life
Average method of
Transportation vehicle 5 5% 19
useful life
Electronic equipments Average method of
5 5% 19
and others useful life
Decoration of fixed Average method of
5 0% 20
assets useful life
The estimated net salvage refers to the amount obtained by the Company from its disposal of the assets by deducting the estimated
disposal expenses based on the assumption that the fixed assets‘ estimated service life expires and reaches the predicted status when
its service life expires.
The fixed assets impairment test methods and the impairment provision calculating and withdrawing method
Please refer to Note IV. 22 ―Long-term Assets Impairment‖ for the fixed assets impairment test methods and the impairment
provision calculating and withdrawing method.
Subsequent expenses related to the fixed assets, if the economic benefits related to the fixed assets are likely to flow in and their costs
can be reliably measured, are included in the cost of fixed assets and the carrying amount of the replaced portion is derecognized.
Other subsequent expenditures other than that shall be recognized in the current profit or loss.
The fixed asset shall be derecognized when the fixed asset is in disposal or is expected not to generate economic benefits through use
or disposal. The difference between the disposal income from the sale, transfer, retirement or damage of the fixed assets less the
carrying amount and related taxes is recognized in profit or loss for the current period.
The Company shall review the useful life, estimated net residual value and depreciation method of the fixed assets at least at the end
of the year, and if there is any change, it shall be treated as the changes in accounting estimations.
(3) Recognition Basis, Pricing and Depreciation Method of Fixed Assets by Finance Lease
The ―finance lease‖ shall refer to a lease that has transferred in substance all the risks and rewards related to the ownership of an asset.
Its ownership may or may not eventually be transferred. The fixed assets by finance lease shall adopt the same depreciation policy for
self-owned fixed assets. If it is reasonable to be certain that the lessee will obtain the ownership of the leased asset when the lease
term expires, the leased asset shall be fully depreciated over its useful life. If it is not reasonable to be certain that the lessee will
obtain the ownership of the leased asset at the expiry of the lease term, the leased asset shall be fully depreciated over the shorter one
of the lease term or its useful life.
17. Construction in Progress
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
Construction in process is measured at actual cost. Actual cost comprises construction costs, borrowing costs that are eligible for
capitalization before the fixed assets being ready for their intended us and other relevant costs. Construction in process is transferred
to fixed assets when the assets are ready for their intended use.
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See the details of the impairment test method of the impairment provision withdrawal method of the construction in progress to Note
IV. 22 ―Long-term assets impairment‖.
18. Borrowing Costs
Borrowing costs include interest on borrowings, amortization of discounts or premiums, ancillary expenses and exchange differences
arising from foreign currency borrowings. The capitalization of borrowing costs, which can be directly attributable to asset
acquisition or construction, starts when asset expenditure or borrowing cost are generated, or the asset acquisition or construction is
launched to enable the asset to meet the predefined conditions for use or sale, and ends when the acquired or constructed asset
conforming to capitalization conditions meet the predefined conditions for use or sale. The other borrowing costs are recognized as
expenses in the current period.
The actual interest expenses incurred in the current period of specific borrowings shall be capitalized by subtracting the interest
income earned by the bank from unused borrowing funds or investment income gained from temporary investment. For general
borrowings, the amount to be capitalized shall be determined based on the weighted average of total asset expenditure exceeding the
specific borrowing multiplied by the capitalization rate of general borrowings. The capitalization rate is determined based on the
weighted average interest rate of general borrowings.
During the capitalization period, the foreign exchange differences on foreign currency specific borrowings shall be capitalized. The
exchange differences on foreign currency general borrowings shall be included in the current profits and losses.
Assets eligible for capitalization refer to assets such as fixed assets, investment real estate and inventory that require a considerable
amount of time for acquisition or construction to be ready for use or sale.
If the acquisition or construction process of the assets eligible for capitalization is stopped unexpectedly for more than 3 months, the
capitalization of borrowing costs shall be suspended until the asset acquisition or construction resumes.
19. Biological Assets
Not applicable
20. Oil-gas Assets
Not applicable
21. Intangible Assets
(1) Pricing Method, Useful Life and Impairment Test
The term ―intangible asset‖ refers to the identifiable non-monetary assets possessed or controlled by enterprises which have no
physical shape.
The intangible assets shall be initially measured according to its cost. The costs related with the intangible assets, if the economic
benefits related to intangible assets are likely to flow into the enterprise and the cost of intangible assets can be measured reliably,
shall be recorded into the costs of intangible assets; otherwise, it shall be recorded into current profits and losses upon the occurrence.
The use right of land gained is usually measured as intangible assets. For the self-developed and constructed factories and other
constructions, the related expenditures on use right of land and construction costs shall be respectively measured as intangible assets
and fixed assets. For the purchased houses and buildings, the related payment shall be distributed into the payment for use right of
land and the payment for buildings, if it is difficult to be distributed, the whole payment shall be treated as fixed assets.
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For intangible assets with a finite service life, from the time when it is available for use, the original vaue shall be amortized by
straight line method during the service life. While the intangible assets without certain service life shall not be amortized.
At the end of period, the Company shall check the service life and amortization method of intangible assets with finite service life, if
there is any change, it shall be regarded as a change of the accounting estimates. Besides, the Company shall check the service life of
intangible assets without certain service life, if there is any evidence showing that the period of intangible assets to bring the
economic benefits to the enterprise can be prospected, it shall be estimated the service life and amortized in accordance with the
amortization policies for intangible assets with finite service life.
(2) Accounting Policy for Internal Research and Development Expenditures
Not applicable
22. Impairment of Long-term Assets
For non-current financial Assets of fixed Assets, projects under construction, intangible Assets with limited service life, investing real
estate with cost model, long-term equity investment of subsidiaries, cooperative enterprises and joint ventures, the Company should
judge whether decrease in value exists on the date of balance sheet. Recoverable amounts should be tested for decrease in value if it
exists. Other intangible Assets of reputation and uncertain service life and other non-accessible intangible assets should be tested for
decrease in value no matter whether it exists.
If the recoverable amount is less than book value in impairment test results, the provision for impairment of differences should
include in impairment loss. Recoverable amounts would be the higher of net value of asset fair value deducting disposal charges or
present value of predicted cash flow. Asset fair value should be determined according to negotiated sales price of fair trade. If no
sales agreement exists but with asset active market, fair value should be determined according to the Buyer‘s price of the asset. If no
sales agreement or asset active market exists, asset fair value could be acquired on the basis of best information available. Disposal
expenses include legal fees, taxes, cartage or other direct expenses of merchantable Assets related to asset disposal. Present value of
predicted asset cash flow should be determined by the proper discount rate according to Assets in service and predicted cash flow of
final disposal. Asset depreciation reserves should be calculated on the basis of single Assets. If it is difficult to predict the recoverable
amounts for single Assets, recoverable amounts should be determined according to the belonging asset group. Asset group is the
minimum asset combination producing cash flow independently.
In impairment test, book value of the business reputation in financial report should be shared to beneficial asset group and asset
group combination in collaboration of business merger. It is shown in the test that if recoverable amounts of shared business
reputation asset group or asset group combination are lower than book value, it should determine the impairment loss. Impairment
loss amount should firstly be deducted and shared to the book value of business reputation of asset group or asset group combination,
then deduct book value of all assets according to proportions of other book value of above assets in asset group or asset group
combination except business reputation.
After the asset impairment loss is determined, recoverable value amounts would not be returned in future.
23. Long-term Deferred Expenses
Long-term deferred expenses refer to general expenses with the apportioned period over one year (one year excluded) that have
occurred but attributable to the current and future periods. And the long-term deferred expense shall be amortized by the straight-line
method averagely within the benefit period.
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24. Payroll
(1) Accounting Treatment of Short-term Compensation
The payroll of the Company mainly includes Short-term Compensation, Welfare after Departure, Demission Welfare, and the Welfare
of Other Long-term Staff. Among which:
Short-term compensation mainly including salary, bonus, allowances and subsidies, employee services and benefits, medical
insurance premiums, birth insurance premium, industrial injury insurance premium, housing fund, labor union expenditure and
personnel education fund, non-monetary benefits etc. The short-term compensation actually happened during the accounting period
when the active staff offering the service for the Company should be recognized as liabilities and is included in the current gains and
losses or relevant assets cost. Of which the non-monetary benefits should be measured according to the fair value.
(2) Accounting Treatment of the Welfare after Departure
Welfare after demission mainly includes basic endowment insurance and unemployment insurance and annuity, and welfare plans
after demission include setting drawing plan. Where the setting drawing plan is adopted, the corresponding payable and deposit
amount should be included into the relevant assets cost or the current gains and losses when happen. The Company relieves the labor
relation with the employees before the due date of the labor contacts or puts forward the advice of providing the compensation for
urging the employees volunteered to receive the downsizing and when the Company could not unilaterally withdraw the demission
welfare owning to the relieving plan of the labor relation or the downsizing advice, should confirm the liabilities of the employees‘
salary from the demission welfare on the earlier day between the cost confirmed by the Company and the cost related to the
reorganization of the payment of the demission welfare and includes which in the current gains and losses. But as for the demission
welfare be estimated that could not be completed paid within 12 months after the end of the annual Reporting Period, should be
handled according to the other long-term employee‘s salary.
(3) Accounting Treatment of the Demission Welfare
The internal retire plan of the employees should be handled by adopting the same principles of the above demission welfare. The
Company includes the salary and the paid social insurance charges planed to pay by the personnel retreated inside during the period
from the date when ceased the services to the normal retire date in the current gains and losses (demission welfare) when met with
the recognition conditions of the estimated liabilities.
(4) Accounting Treatment of the Welfare of Other Long-term Staffs
The other long-term welfare that the Company offers to the staffs, if met with the setting drawing plan, should be accounting
disposed according to the setting drawing plan, while the rest should be disposed according to the setting revenue plan.
25. Estimated Liabilities
The obligation pertinent to contingencies shall be recognized as an estimated debts when the following conditions are satisfied
simultaneously: ① That obligation is a current obligation of the enterprise; ② It is likely to cause any economic benefit to flow out
of the enterprise as a result of performance of the obligation; and ③ The amount of the obligation can be measured in a reliable way
On balance sheet date, given the risks, uncertainty, the time value of money, and other factors pertinent to the contingencies, the
estimated debts shall be measured in accordance with the best estimate of the necessary expenses for the performance of the current
obligation.
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When all or some of the expenses necessary for the liquidation of an estimated debts of an enterprise is expected to be compensated
by a third party, the compensation should be separately recognized as an asset only when it is virtually certain that the reimbursement
will be obtained. The amount of compensation is not exceeding the book value of the recognized estimated liabilities.
26. Share-based Payment
Not applicable
27. Other Financial Instruments such as Preferred Shares and Perpetual Capital Securities
Not applicable
28. Revenue
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
The revenue of the Group including the commodities sales revenue, real estate sales revenues, property leasing revenues, labor
revenues and the revenues from the using of the assets of the Company by others.
(1) Selling products
No revenue from selling goods may be recognized unless the following conditions are met simultaneously: the significant risks and
rewards of ownership of the goods have been transferred to the buyer by the enterprise; the enterprise retains neither continuous
management right that usually keeps relation with the ownership nor effective control over the sold goods; the relevant amount of
revenue can be measured in a reliable way; the relevant economic benefits may flow into the enterprise; and the relevant costs
incurred or to be incurred can be measured in a reliable way.
The revenues of the sales of the commodities of the Group were mainly the sales revenues of the commercial residential buildings.
The sales of the properties of the Group had executed completion acceptance that had transferred to the buyers or be regarded as had
transferred to the buyers according to the sales contacts as well as confirmed the realization of the revenues when executing the
liquidation of the sales amount of the commercial residential buildings (the mortgage purchase way of the buildings were the
receipted down payment and the bank mortgage amount).
(2) Provide labor income
The labor income provided by the Group mainly comes from property management income, project supervision service income and
catering service income.
Property management income: the property management income is realized when the property management service has been
provided and the service fee as agreed with the owner is able to flow into the enterprise.
Other labor income: the labor income is realized when the labor service has been provided and the related economic interest is able to
flow into the enterprise and related cost is able to be reliably measured.
The outcome of a transaction concerning the providing of labor services can be measured in a reliable way, means that the following
conditions shall be met simultaneously: ① The amount of revenue can be measured in a reliable way; ② The relevant economic
benefits are likely to flow into the enterprise; ③The costs incurred or to be incurred in the transaction can be measured in a reliable
way.
If the outcome of a transaction concerning the providing of labor services can‘t be measured in a reliable way, the revenue from the
providing of labor services shall be recognized in accordance with the amount of the cost of labor services incurred and expected to
be compensated, and make the cost of labor services incurred as the current expenses. If it is predicted that the cost of labor services
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incurred couldn‘t be compensated, thus no revenue shall be recognized.
Where a contract or agreement signed between Company and other enterprises concerns selling goods and providing of labor services,
if the part of sale of goods and the part of providing labor services can be distinguished from each other and can be measured
respectively, the part of sale of goods and the part of providing labor services shall be treated respectively. If the part of selling goods
and the part of providing labor services can‘t be distinguished from each other, or if the part of sale of goods and the part of providing
labor services can be distinguished from each other but can‘t be measured respectively, both parts shall be conducted as selling
goods.
(3) Income from transferring asset use right
The income from transferring asset use right includes property lease income, and other use right income.
Property lease income: the property lease income is realized by the method of straight line as agreed in the lease contract or
agreement signed with the leasee. If there are lease periods free of any rent, the lessor shall distribute the total rent, not deducting the
rent during those periods free of any rent, within the entire lease period by the method of straight line or other reasonable means.
During the periods free of any rent, the lessor shall recognize the lease income.
Income from other use right: the income from transferring asset use right is recognized when the income amount is able to be reliably
measured and related economic interest is possible to flow into the enterprise.
(4) Interest income
The interest income is recognized by the duration you use the Company‘s monetary capital and the actual interest rate.
29. Government Subsidies
The government subsidy refers to the Company gets the monetary and non-monetary assets for free from the government, excluding
the capital that the government invests as the investor who enjoys the corresponding owner‘s equity. It can be divided into the
asset-related government subsidy and income-related government subsidy. The government subsidies pertinent to assets mean the
government assets that are obtained by enterprises used for purchase or construction, or forming the long-term assets by other ways.
The government subsidies pertinent to income refer to all the government subsides except those pertinent to assets. If the government
subsidies documents had not definitely confirm the subsidy targets, based on the basic requirements necessary for the subsidies, the
government subsidies based on long-term assets formed through purchase and construction and other methods are regarded as
government subsidies related to assets. Beyond that, the rest are divided as the government subsidies related to income. If monetary
grants are received, it recognized at actual received or receivable amount. If non-monetary grants are received, it recognized at fair
value, replacing with nominal amount while fair value is not reliable. Government subsidies measured at nominal amount are directly
recorded into the current profit and loss.
The asset-related government subsidy shall be confirmed as the deferred income, and it shall be calculated into the current profits and
losses by stages in reasonable and systematic way within the service life of related asset. The income-related government subsidy to
compensate the related expense and loss later shall be confirmed as the deferred income, and it shall be calculated in the current
profits and losses during the period to confirm the related costs or losses; the occurred related costs or losses for compensation shall
be calculated in the current profits and losses directly.
For government subsidy including the asset-related government subsidy and the income-related government subsidy at one time,
accounting treatment shall be conducted respectively to distinguish the different parts; if it is difficult to distinguish, then it shall be
classified into the income-related government subsidy
Government subsidies related to routine activities of the Company shall be calculated into other income according to the essence of
economic business; government subsidies that have nothing to do with routine activities shall calculated into non-operating income.
30. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Income tax of the current period
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On the balance sheet date, for the current income tax liabilities (or assets) of the current period as well as the part formed during the
previous period, should be measured by the income tax of the estimated payable (returnable) amount which be calculated according
to the regulations of the tax law. The amount of the income tax payable which is based by the calculation of the current income tax
expenses, are according to the result measured from the corresponding adjustment of the pre-tax accounting profit of this year which
in accord to the relevant regulations of the tax law.
(2) Deferred income tax assets and deferred income tax liabilities
The difference between the book value of certain assets and liabilities and their tax assessment basis, as well as the temporary
difference occurs from the difference between the book value of the items which not be recognized as assets and liabilities but could
confirm their tax assessment basis according to the regulations of the tax law, the deferred income tax assets and the deferred income
tax liabilities should be recognized by adopting liabilities law of the balance sheet.
No deferred tax liability is recognized for a temporary difference arising from the initial recognition of goodwill, the initial
recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting profit nor
taxable profit (or deductible loss). Besides, no deferred tax assets is recognized for the taxable temporary differences related to the
investments of subsidiary companies, associated enterprises and joint enterprises, and the investing enterprise can control the time of
the reverse of temporary differences as well as the temporary differences are unlikely to be reversed in the excepted future. Otherwise,
the Group should recognize the deferred income tax liabilities arising form other taxable temporary difference.
No deferred taxable assets should be recognized for the deductible temporary difference of initial recognition of assets and liabilities
arising from the transaction which is not business combination, the accounting profits will not be affected, nor will the taxable
amount or deductible loss be affected at the time of transaction. Besides, no deferred taxable assets should be recognized for the
deductible temporary difference related to the investments of the subsidiary companies, associated enterprises and joint enterprises,
which are not likely to be reversed in the expected future or is not likely to acquire any amount of taxable income tax that may be
used for making up such deductible temporary differences. Otherwise, the Company shall recognize the deferred income tax assets
arising from a deductible temporary difference basing on the extent of the amount of the taxable income that is likely to be acquired
to make up such deductible temporary differences
For any deductible loss or tax deduction that can be carried forward to the next year, the corresponding deferred income tax asset
shall be determined to the extent that the amount of future taxable income to be offset by the deductible loss or tax deduction to be
likely obtained.
On the balance sheet date, the deferred income tax assets and the deferred income tax liabilities shall be measured at the tax rate
applicable to the period during which the assets are expected to be recovered or the liabilities are expected to be settled.
The book value of deferred income tax assets shall be reviewed at each balance sheet date. If it is unlikely to obtain sufficient taxable
income to offset against the benefit of the deferred income tax asset, the book value of the deferred income tax assets shall be written
down. Any such write-down should be subsequently reversed where it becomes probable that sufficient taxable income will be
available.
(3) Income tax expenses
Income tax expenses include current income tax and deferred income tax.
The rest current income tax and the deferred income tax expenses or revenue should be included into current gains and losses except
for the current income tax and the deferred income tax related to the transaction and events that be confirmed as other comprehensive
income or be directly included in the shareholders‘ equity which should be included in other comprehensive income or shareholders‘
equity as well as the book value for adjusting the goodwill of the deferred income tax occurs from the business combination.
(4) Offset of income tax
The current income tax assets and liabilities of the Company should be listed by the written-off net amount which intend to executes
the net amount settlement as well as the assets acquiring and liabilities liquidation at the same time while owns the legal rights of
settling the net amount.
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The deferred income tax assets and liabilities of the Company should be listed as written-off net amount when having the legal rights
of settling the current income tax assets and liabilities by net amount and the deferred income tax and liabilities is relevant to the
income tax which be collected from the same taxpaying bodies by the same tax collection and administration department or is
relevant to the different taxpaying bodies but during each period which there is significant reverse of the deferred income assets and
liabilities in the future and among which the involved taxpaying bodies intend to settle the current income tax and liabilities by net
amount or are at the same time acquire the asset as well as liquidate the liabilities.
31. Lease
(1) Accounting Treatment of Operating Lease
Financial lease is the lease that actually transfers all risks and compensation related to assets ownership, and its ownership may
transfer, or may not transfer. Other lease except financial lease is operating lease.
Business of operating leases recorded by the Group as the lessee
The rent expenses from operating leases shall be recorded by the lessee in the relevant asset costs or the profits and losses of the
current period by using the straight-line method over each period of the lease term. The initial direct costs shall be recognized as the
profits and losses of the current period. The contingent rents shall be recorded into the profits and losses of the current period in
which they actually arise.
Business of operating leases recorded by the Group as the lessor
The rent incomes from operating leases shall be recognized as the profits and losses of the current period by using the straight-line
method over each period of the lease term. The initial direct costs of great amount shall be capitalized when incurred, and be
recorded into current profits and losses in accordance with the same basis for recognition of rent incomes over the whole lease term.
The initial direct costs of small amount shall be recorded into current profits and losses when incurred. The contingent rents shall be
recorded into the profits and losses of the current period in which they actually arise.
(2) Accounting Treatments of Financial Lease
Business of finance leases recorded by the Company as the lessee
On the lease beginning date, the Company shall record the lower one of the fair value of the leased asset and the present value of the
minimum lease payments on the lease beginning date as the entering value in an account, recognize the amount of the minimum lease
payments as the entering value in an account of long-term account payable, and treat the balance between the recorded amount of the
leased asset and the long-term account payable as unrecognized financing charges. Besides, the initial direct costs directly
attributable to the leased item incurred during the process of lease negotiating and signing the leasing agreement shall be recorded in
the asset value of the current period. The balance through deducting unrecognized financing charges from the minimum lease
payments shall be respectively stated in long-term liabilities and long-term liabilities due within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease term, so as to calculate and
recognize current financing charges. The contingent rents shall be recorded into the profits and losses of the current period in which
they actually arise.
32. Other Significant Accounting Policies and Estimates
(1) Measurement of fair value
Fair value refers to the price received from selling any asset or paid for transferring any liability in the orderly transactions that occur
on the measurement date of the market participants. The Group should consider the characteristics of the assets or liabilities when
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measuring the relevant assets or liabilities by fair value; to suppose the transactions of selling or transferring the assets on the
measurement date by the market participants is the orderly transactions under the conditions of the current market; to suppose the
orderly transaction of selling or transferring the assets is executing in the market of the relevant assets or liabilities; to suppose the
transaction is executing in the most favorable market of the relevant assets or liabilities if there is no any main market. The Group
adopts the advice used when pricing the assets or liabilities for realizing the maximum of the economy benefits by the market
participants.
The Group judges the fair value of initial recognition whether is equal to the transaction price according to the characteristics of the
relevant assets or liabilities with transaction nature etc.; if the transaction price and fair value is not equal, should include the relevant
gains or losses in the current gains and losses except for those stipulated by other relevant ASBE.
The Group adopts the assessment technology which adapt to the current conditions with sufficient available data and other
information support, and the assessment technology mainly including the market method, equity method and cost method. In the
application of the assessment technology, the Group should prefer the relevant observable input value and only when the relevant
observable input value could not be required or required the not feasible value, could use the not observable input value.
The input value used for the fair value measurement is divided into three levels and the first level of the input value is initially used,
then come to the second level and the third one the last. The first level input value is the quotation acquired from the active market of
the same assets or liabilities that had not be adjusted; the second input value is the input value could be directly or indirectly observed
of the relevant assets or liabilities except for the first level input value; the third level input value is the not observable input value of
the relevant assets or liabilities.
The Group measures the non-financial assets by fair value by considering the ability of the market participants when using the assets
for the best purpose for causing the economy benefits or the ability to sell the assets to the other market participants which can use
them with the best purpose for causing the economy benefits. The Group supposes to transfer the liabilities to other market
participants on the measurement date and the liabilities would be continue to exist after the transfer as well as to be as the market
participants of the transferees to execute the obligation when measuring the liabilities by fair value. The Group supposes to transfer
the self equity instruments to other market participants on the measurement date and the self equity instruments would be continue to
exist after the transfer as well transferees as to acquire the relevant rights and to undertake the relevant obligations as the market
participants of the s.
(2) Termination of operation
Termination of operation refers to a separately identifiable constituent part that satisfies one of the following conditions that has been
disposed of by the Company or is classified as held-for-sale: This constituent part represents an independent main business or a
separate main business area. This constituent part is part of an associated plan that is intended to be disposed of in an independent
main business or a separate major business area. This constituent part is a subsidiary that is specifically acquired for resale.
For details of accounting arrangement method of termination of operation, see relevant descriptions of Note IV. 12 Assets Held for
Sale and Disposal Group
(3) Segmental report
The Group recognizes the operating segments according to the internal organization structure, the management requirements and the
internal report system and recognizes the reporting segments and discloses the segmental information according base on the
operating segments.
Operating segments refer to the compose parts of the Group which meet with the following conditions at the same time: (1). the
compose part could cause revenues and expenses in the daily activities; (2). the management layer could periodically evaluate the
operation results of the compose part and base which to distribute the resources and evaluate the performance; (3). the Group could
acquire the relevant accounting information of the financial conditions, operation results and the cash flows of the compose part. If
two or more operating segments own the similar economy characteristics and meet with certain conditions, could be combining as an
operating segment.
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
33. Changes in Main Accounting Policies and Estimates
(1) Change of Accounting Policies
□ Applicable √ Not applicable
(2) Changes in Accounting Estimates
□ Applicable √ Not applicable
34. Other
Significant Accounting Adjustment and Estimates
Due to the internal uncertainty of operating activities, the Company needs to make judgments, estimates and assumptions for carrying
amounts of statement items that can‘t be measured accurately during the process of applying accounting policies. Such judgments,
estimates and assumptions are made on the basis of the past experience of Company‘s management staffs and on the consideration of
other relevant factors. Such judgments, estimates and assumptions have effect on reporting amount of incomes, expense, assets and
liabilities, as well as disclosure of contingent liabilities on the balance sheet date. However, the uncertainty of such estimates may
results in major adjustments of carrying amounts of assets or liabilities that will be influenced in future.
The Company shall have a check on the aforesaid judgments, estimates and assumptions at fixed intervals on the basis of sustainable
operation. As for the change in accounting estimates that only effects on the current period of the change, the affected amount thereof
shall be recognized at current period of the change. As for accounting estimates that effects on both the current period of the change
and future periods, the affected amount thereof shall be recognized at current period of the change and future periods.
On balance sheet date, major fields requiring judgments, estimates and assumptions on amounts of financial statement items by the
Company are as follows:
(1) Classification of leases
In line with rules in Accounting Standards for Enterprises No. 21 – Leases, the Company classifies leases into operating leases and
finance leases. Upon the classification, the management staffs need to make analysis and judgments on whether to essentially transfer
all risks and remuneration relating to the ownership of leased-out assets to the lessee, or whether the Company has essentially
undertaken all risks and remuneration relating to the ownership of leased-in assets.
(2) Withdrawal of bad debt provisions
The Company shall, in accordance with accounting policies of receivables, calculate bad debt provisions by adopting allowance
method. Impairment of accounts receivable is based on the assessment of the recovery of accounts receivable. Identification of
impairment of accounts receivable requires judgments and estimates by management staffs. The difference between actual outcomes
and originally estimated outcomes, which will influence the carrying amount of accounts receivable and bad debt provisions thereof
in the estimated period of the change, shall be withdrawn or reversed.
(3) Inventory depreciation reserves
The Company shall calculate whichever is lower between the cost and realizable net value in light of inventory accounting policies.
As for inventories of which the cost is higher than the realizable net value and inventories which are obsolete and unsalable inventory
depreciation reserves shall be withdrawn. Impairment of inventories to realizable net value is based on the assessment of the
marketing of inventories and realizable net value thereof. Identification of inventory impairment requires well-established evidences
by management staffs, as well as judgments and estimates based on consideration of the purpose of holding inventories and other
factors such as events occurring after the date of balance sheet. The difference between actual outcomes and originally estimated
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
outcomes, which will influence the carrying amount of inventories and inventory depreciation reserves in the estimated period of the
change, shall be withdrawn or reversed.
(4) Fair values of financial instruments
As for financial instruments not existing in active trading market, the Company shall determine their fair values by all kinds of
assessment methods, which include model analysis of discounted cash flow and etc. During the assessment, the Company needs to
assess for respects such as future cash flows, credit risks, market volatility, correlation, and choose appropriate discount rate. Such
related assumptions have uncertainty, of which the change will effect on fair values of financial instruments.
(5) Impairment of financial assets available for sale
To a large extent, whether the impairment of financial assets available for sale is recognized or not relies on the judgments and
assumptions of the management staffs. In that way, the Company shall be certain about whether to recognize impairment losses of
financial assets available for sale in the profit statement. During the process of making judgments and assumptions, the Company
needs to evaluate how much the fair value of such investment is less than its cost, how long such investment will last, and the
financial condition and short-term business outlook of the invested parties, which include industry status, technology transform,
credit rating, default rate and risks from the opposite parties.
(6) Impairment provisions for long-term assets
The Company shall judge whether there is sign of impairment of non-current assets other than financial assets on balance sheet date.
Intangible assets with uncertain service lives, besides being conducted with annual impairment test every year, have to accept
impairment tests when there is sign of impairment. Other non-current assets except for financial assets have to accept impairment
tests when there is sign indicating the carrying amount thereof is unrecoverable.
When the carrying amounts of the asset or group assets are higher than the recoverable amounts, namely whichever is higher between
the net amount through deducting disposal charges from the fair value and the present value of the estimated future cash flow,
impairment occurs.
The net amount of the fair value of an asset minus the disposal expenses shall be determined in light of the amount of the basis of the
price as stipulated in the sales agreement or the observable market price in the fair transaction minus the incremental cost directly
subject to the disposal of the asset.
When estimating present value of future cash flows, it is necessary to make significant judgments on characters of the asset or asset
group, such as output, sales price, related operating costs, and discount used to calculate the present value. When estimating
recoverable amount, the Company shall adopt all relevant materials that can be required, including estimates relating to output, sales
price and relevant operating costs judged by rational and supportable assumptions.
The Company tests whether there is impairment of good will at least for every year, which requires itself to estimate the present value
of the future cash flow of group assets or combination of group assets. When estimating the present value of the future cash flow, the
Company needs to estimate the cash flow arising from future group assets or combination of group assets, and at the same time
choose appropriate discount rate to determine the present value of the future cash flow.
(7) Depreciation and amortization
Upon consideration on the salvage value of investment real estates, fixed assets and intangible assets, the Company shall withdraw
depreciation and amortization by straight-line method over their service lives. The Company checks on service lives at fixed intervals,
so as to determine the amounts of depreciation expenses and amortization expenses at each period. Service lives are confirmed in
accordance with the past experience on similar assets of the Company, along with renewed technology of expectation. If any
significant change occurred to previous estimated, depreciation expenses and amortization expenses will be adjusted in future period.
(8) Deferred income tax assets
In a limit providing large possibility of offset losses from sufficient taxable profits, the Group shall recognize deferred income tax
assets in line with all unused tax losses, which requires management staffs of the Group to estimate the time when future taxable
profits occurs and the amount thereof by applying plenty of judgments and combining tax planning strategies, so as to determine the
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
amount of the recognizable deferred income tax assets.
(9) Income taxes
There‘s certain uncertainty of disposal and calculation of taxes of partial transactions in normal operating activities. It is uncertain
whether some pre-taxed items can set aside the approvals by tax authorities or not. If there are differences between the ultimate
recognition outcomes and the originally estimated amounts of such tax issues, then such differences shall effect on the current
income tax and deferred income tax during the ultimate recognition period.
VI Taxes
1. Main Taxes and Tax Rates
Category of taxes Tax basis Tax rate
VAT Operating revenue For details, see 3. Other of this section
Applied to 7%, 1% separately according to
Urban maintenance and construction tax Turnover tax payable
the regional level
Enterprise income tax Taxable income 15%, 20%, 16.5%, 25%
Paid according to 3% of the actual paid
Education surcharge Taxable income
turnover tax
Paid according to 2% of the actual paid
Local education surcharge Taxable income
turnover tax
Four progressive levels with the tax rate
Added amount from transfer of real
Land value appreciation tax ranging from 30% to 60% of transferring
property
real estate added value
Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
Name Income tax rate
Chongqing Shenzhen International Trade Center Property
15%
Management Co., Ltd.
Chongqing Aobo Elevator Co., Ltd. 20%
Subsidiaries registered in Hong Kong area 16.5%
Other taxpaying bodies within the consolidated scope 25%
2. Tax Preference
According to the regulations of No. 2, Property Service of No. 37, Commercial Service among the encouraging category of the
Guidance Catalogue of Industry Constructure Adjustment (Y2011), the western industry met with the conditions should be collected
the corporate income tax according to 15% of the tax rate. The subsidiary of the Group Chongqing Shenzhen International Trade
Center Property Management Co., Ltd. had be regarded as the western enterprise of the property service by Local Taxation Bureau of
Chongqing Jiulong District on 4 May 2014, and had be collected the corporate income tax according to 15% of the tax rate.
According to the regulations of the notice of the income tax preferential policies of the small low-profit enterprises issued by SAT of
CS [2015] No. 34, from 1 January 2017 to 31December 2019, as for those small low-profit enterprises with the annual after-tax
amount lower than RMB0.2 million (including RMB0.2 million), of which 50% of the revenues should be included into the taxable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
income and should be collected the corporate income tax according to 20% of the tax rate. The subsidiary of the Company,
Chongqing Aobo Elevator Co., Ltd, has applied to this policy since 2017, which 50% of the revenues is included into the taxable
income and is collected the corporate income tax according to 20% of the tax rate.
3. Other
Note 1. Taxable items and tax rate of the VAT of the Company and its subsidiaries are as follows:
Type of the revenue General rate Percentage charges of
Sales of house property 10% 5%
Rent of real estate 10% 5%
Property service 6% 3%
Catering service 6% 3%
Others 16% --
VII. Notes to Major Items in the Consolidated Financial Statements of the Company
1. Monetary Funds
Unit: RMB
Item Ending balance Beginning balance
Cash on hand 176,193.08 164,502.21
Bank deposits 3,375,538,497.01 2,463,348,038.01
Other monetary funds 13,519,667.63 13,516,274.99
Total 3,389,234,357.72 2,477,028,815.21
Of which: the total amount deposited
52,976,296.80 50,659,691.68
overseas
Other notes:
Note: on 31 December 2018, the monetary capital with restricted ownership of the Company was of RMB13,519,667.63, for details,
see Note XIV. 2. (2) .
2. Financial Assets at Fair Value through Profit or Loss
Unit: RMB
Item Ending balance Beginning balance
Other notes:
Naught
3. Derivative Financial Assets
□ Applicable √ Not applicable
135
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
4. Notes Receivable and Accounts Receivable
Unit: RMB
Item Ending balance Beginning balance
Accounts receivable 64,231,267.94 46,272,600.86
Total 64,231,267.94 46,272,600.86
(1)Notes Receivable
1) Notes Receivable Listed by Category
Unit: RMB
Item Ending balance Beginning balance
2) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
Item Amount
3) Notes Receivable which Had Endorsed by the Company or had Discounted and had not Due on the Balance Sheet Date at the
Period-end
Unit: RMB
Amount of recognition termination at the Amount of not terminated recognition at
Item
period-end the period-end
4) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the Contract or Agreement
Unit: RMB
Amount of the notes transferred to accounts receivable at the
Item
period-end
Other notes:
(2)Accounts Receivable
1) Accounts Receivable Classified by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra
Carrying Carrying
Proportio wal Proportio Withdrawal
Amount Amount value Amount Amount value
n proportio n proportion
n
Accounts receivable
99,466,1 99,466,1 99,466, 99,466,17
with significant 59.08% 100.00% 66.53% 100.00%
73.89 73.89 173.89 3.89
single amount with
136
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
bad debt provision
separately accrued
Accounts receivable
withdrawn bad debt
67,955,2 3,724,01 64,231,26 49,088, 2,816,177 46,272,600.
provision according 40.36% 5.48% 32.84% 5.74%
77.98 0.04 7.94 778.72 .86 86
to credit risks
characteristics
Accounts receivable
with insignificant
single amount for 942,824. 942,824. 942,824 942,824.5
0.56% 100.00% 0.63% 100.00%
which bad debt 55 55 .55 5
provision separately
accrued
168,364, 104,133, 64,231,26 149,497 103,225,1 46,272,600.
Total 100.00% 61.85% 100.00% 69.05%
276.42 008.48 7.94 ,777.16 76.30 86
Accounts receivable with significant single amount for which bad debt provision separately accrued at the period-end：
√Applicable □ Not applicable
Unit: RMB
Accounts receivable Ending balance
(classified by units) Accounts receivable Bad debt provision Proportion Reason
Involved in lawsuit and
Shenzhen Jiyong
no executable property,
Properties & Resources 93,811,328.05 93,811,328.05 100.00%
and see details in Notes
Development Company
(XIV). 2. (1)
Shenzhen Tewei Industry Uncollectible for a long
2,836,561.00 2,836,561.00 100.00%
Co., Ltd. period
Poor operating
Lunan Industry
2,818,284.84 2,818,284.84 100.00% conditions, uncollectible
Corporation
for a long period
Total 99,466,173.89 99,466,173.89 -- --
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Not applicable
Unit: RMB
Ending balance
Aging
Accounts receivable Bad debt provision Withdrawal proportion
Sub-item within 1 year
Within 1 year 61,150,863.40 1,834,525.90 3.00%
Subtotal within 1 year 61,150,863.40 1,834,525.90 3.00%
1 to 2 years 3,555,648.91 355,564.89 10.00%
137
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2 to 3 years 1,889,494.67 566,848.40 30.00%
3 to 4 years 740,994.66 370,497.33 50.00%
4 to 5 years 108,514.08 86,811.26 80.00%
Over 5 years 509,762.26 509,762.26 100.00%
Total 67,955,277.98 3,724,010.04
Notes of the basis of recognizing the group:
Note: The basic of recognizing the group refers to Notes V. 11 ―Accounts Receivable‖ (2).
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision
□ Applicable √ Not applicable
In the groups, accounts receivable adopting other methods to accrue bad debt provision:
Not applicable
2) Accounts Receivable Withdraw, Reversed or Collected during the Reporting Period
The withdrawal amount of the bad debt provision during this Reporting Period was of RMB907,832.18; the amount of the reversed
or collected part during this Reporting Period was of RMB0.00.
Of which significant amount of the reversed or collected:
Unit: RMB
Name of the entity Amount Method
Naught
3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
Unit: RMB
Item Amount
Of which: significant actual verification of accounts receivable
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes of the verification of accounts receivable:
Naught
(4) Top 5 of the Ending Balance of the Accounts Receivable Collected according to the Arrears Party
Name of units Relationship with Amount Age limit As % of total
the Company accounts
receivable (%)
Shenzhen Jiyong Properties & Not-related 93,811,328.05 Over 5 years 55.72
Resources Development
Company
Alibaba Internet Technology Not-related 21,389,086.53 Within 1 year 12.70
Co., Ltd
Shenzhen Tewei Industry Co., Not-related 2,836,561.00 Over 5 years 1.68
138
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ltd.
Lunan Industry Corporation Not-related 2,818,284.84 Over 5 years 1.67
Shangdong Finance Real Estate Not-related 1,891,934.56 Within 1 year 1.12
Co., Ltd
Total 122,747,194.9 72.89
8
5) Derecogniziton of Accounts Receivable due to the Transfer of Financial Assets
Not applicable
6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Accounts Receivable
Not applicable
Other notes:
Not applicable
5. Prepayments
(1) List by Aging Analysis
Unit: RMB
Ending balance Beginning balance
Aging
Amount Proportion Amount Proportion
Within 1 year 27,130,150.07 75.54% 16,414,273.12 58.31%
1 to 2 years 8,272,467.04 23.04% 11,704,985.06 41.58%
2 to 3 years 500,503.40 1.39% 20,656.62 0.07%
Over 3 years 10,043.81 0.03% 10,041.80 0.04%
Total 35,913,164.32 -- 28,149,956.60 --
Notes of the reasons of the prepayment aging over 1 year with significant amount but failed settled in time:
The prepayment aging over 1 year are the various prepaid taxes, like business tax, Urban construction tax, and educational surtax of
prepayment of real estate projects still not reaching the recognition of income conditions according to tax law.
(2) Top 5 of the Ending Balance of the Prepayments Collected according to the Prepayment Target
Name of units Ending balance As % of the total ending balance
of the prepayments (%)
Prepayment of taxes 33,676,909.33 93.77
State Grid Chongqing Electric Power 475,000.00 1.32
Co., Ltd
Chongqing Caitong Water Affairs Co., 300,000.00 0.84
Ltd
Shenzhen Tianfu Fire Engineering Co., 266,000.00 0.74
139
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ltd
Shenzhen Jian‘an (Group) Co., Ltd 116,000.00 0.32
Total 34,833,909.33 96.99
Other notes:
The balance of prepayment of taxes of the Company are the various prepaid taxes, like business tax, Urban construction tax, and
educational surtax of prepayment of real estate projects still not reaching the recognition of income conditions according to tax law.
6. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable 8,293,317.33
Other receivables 16,135,093.86 91,345,782.84
Total 24,428,411.19 91,345,782.84
(1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
Item Ending balance Beginning balance
Fixed time deposits 8,293,317.33
Total 8,293,317.33
2) Significant Overdue Interest
Unit: RMB
Whether occurred
Entity Ending balance Overdue time Overdue reason impairment and the
judgment basis
Other notes:
Naught
(2) Dividends Receivable
1) Dividends Receivable
Unit: RMB
Item (or investees) Ending balance Beginning balance
2) Significant Dividends Receivable Aged over 1 Year
Unit: RMB
Whether occurred
Item (or investees) Ending balance Aging Reason
impairment and the
140
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
judgment basis
Other notes:
None
(3) Other Receivables
1) Other Receivables Classified by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra
Carrying Carrying
Proportio wal Proportio Withdrawal
Amount Amount value Amount Amount value
n proportio n proportion
n
Other receivables
with significant
single amount for 14,066,6 14,066,6 21,046, 21,046,88
28.97% 100.00% 15.94% 100.00%
which bad debt 15.90 15.90 888.91 8.91
provision separately
accrued
Other receivables
withdrawn bad debt
29,649,4 13,514,3 16,135,09 105,826 14,481,06 91,345,782.
provision according 61.06% 45.58% 80.16% 13.68%
37.37 43.51 3.86 ,852.42 9.58 84
to credit risks
characteristics
Other receivables
with insignificant
single amount for 4,845,26 4,845,26 5,144,0 5,144,059
9.98% 100.00% 3.90% 100.00%
which bad debt 3.65 3.65 59.49 .49
provision separately
accrued
48,561,3 32,426,2 16,135,09 132,017 40,672,01 91,345,782.
Total 100.00% 66.45% 100.00% 30.81%
16.92 23.06 3.86 ,800.82 7.98 84
Other receivables with significant single amount for which bad debt provision separately accrued at the period-end
√ Applicable □ Not applicable
Unit: RMB
Other receivables (by Ending balance
unit) Other receivables Bad debt provision Withdrawal proportion Withdrawal reason
Shanghai Yutong Real Difficult to recover the
5,676,000.00 5,676,000.00 100.00%
estate development Co., lawsuit judgment
141
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ltd.
Hong Kong Yueheng Unrecoverable for a long
3,271,837.78 3,271,837.78 100.00%
Development Co., Ltd. term
Dameisha Tourism Projects construction ce
2,576,445.69 2,576,445.69 100.00%
Center ased
Projects construction
Elevated Train Project 2,542,332.43 2,542,332.43 100.00%
ceased
Total 14,066,615.90 14,066,615.90 -- --
Among these groups, other receivables adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Not applicable
Unit: RMB
Ending balance
Aging
Other receivables Bad debt provision Withdrawal proportion
Subentry within 1 year
Within 1 year 9,777,854.77 293,335.65 3.00%
Subtotal within 1 year 9,777,854.77 293,335.65 3.00%
1 to 2 years 3,747,597.17 374,759.72 10.00%
2 to 3 years 3,711,862.45 1,113,558.73 30.00%
3 to 4 years 1,101,987.13 550,993.56 50.00%
4 to 5 years 642,200.00 513,760.00 80.00%
Over 5 years 10,667,935.85 10,667,935.85 100.00%
Total 29,649,437.37 13,514,343.51
Notes:
Note: refer to Note V-11. Accounts Receivable-(2) for relevant details.
Among these groups, other receivables adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Not applicable
Among these groups, other receivables adopting other methods to withdraw bad debt provision:
□ Applicable √ Not applicable
2) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or
collected part during the Reporting Period was of RMB1,268,154.93.
Significant amount of reversed or recovered bad debt provision during the Reporting Period:
Unit: RMB
Name of the entity Reversed or collected amount Method
The withdrawal amount of bad debt provision in current period is RMB0.00; the exchange rate translation for the foreign-currency
loans withdrawal amount of bad debt provision receivable and foreign-currency financial statement translation increased bad debt
provision is RMB2,633.02. As the court ruled that Shenzhen Shengfeng Road, Guomao Jewel & Gold Co., Ltd. ended the bankruptcy
proceedings, it transferred RMB6,980,273.01 to the other current assets with the original value. the amount of the reversed or collected
142
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
part during the Reporting Period was of RMB1,268,154.93.
3) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
Item Amount
Of which: significant actual verification of other receivables:
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes of verification of other receivables:
None
4) Other Receivables Classified by Account Nature
Unit: RMB
Nature Ending carrying amount Beginning carrying amount
Margin 11,525,412.63 10,114,308.11
Cash deposit 4,592,622.32 2,683,810.92
Petty cash 595,535.66 1,565,686.27
Payments on behalf 1,054,967.78 973,252.97
Intercourse funds 28,022,997.15 114,000,793.48
Other 2,769,781.38 2,679,949.07
Total 48,561,316.92 132,017,800.82
5) Top 5 of the Ending Balance of the Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to ending
Ending balance of
Name of the entity Nature Ending balance Aging balance of other
bad debt provision
receivables%
Shanghai Yutong
Real estate
Non-related party 5,676,000.00 Over 5 years 9.98% 5,676,000.00
development Co.,
Ltd.
Hong Kong Yueheng
Development Co., Non-related party 3,271,837.78 Over 5 years 5.75% 3,271,837.78
Ltd.
Yangzhou Housing
Loans Guarantee Non-related party 2,750,000.00 1-5 years 4.84% 722,000.00
Service Center
Dameisha Tourism Non-related party 2,576,445.69 Over 5 years 4.53% 2,576,445.69
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Center
Elevated Train
Non-related party 2,542,332.43 Over 5 years 4.47% 2,542,332.43
Project
Total -- 16,816,615.90 -- 29.57% 14,788,615.90
6) Accounts Receivable Involving Government Subsidies
Unit: RMB
Project of government Estimated recovering
Name of the entity Ending balance Aging at period-end
subsidies time, amount and basis
None
7) Derecogniziton of Other Receivables due to the Transfer of Financial Assets
None
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables
None
Other notes:
As the court ruled that Shenzhen Shengfeng Road, Guomao Jewel & Gold Co., Ltd. ended the bankruptcy proceedings,
RMB6,980,273.01 was transferred into other current assets with the original value.
Name of the entity Nature of other Amount transferred out Reason for transfer out
receivables Other Bad debt
receivables provision
Shenzhen Shengfeng Rental fees and 6,980,273.01 6,980,273.01 Transferred into assets group
Road, Guomao Jewel utilities to be verified
& Gold Co., Ltd.
Total —— 6,980,273.01 6,980,273.01 ——
7. Inventories
Whether the Company need satisfy relevant disclosure requirements governing the real estate industry
Yes
(1) Category of Inventories
The Company needs to comply with the disclosure requirements of Shenzhen Stock Exchange Industry Information Disclosure
Guidelines No.3-Listed Companies Engaged in Real Estate Industry
Classified by nature
Unit: RMB
Ending balance Beginning balance
Item Falling price Falling price
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
R&D expenses 740,858,627.04 6,648,404.13 734,210,222.91 522,188,965.52 6,648,404.13 515,540,561.39
R&D of products 448,118,524.87 1,611,969.40 446,506,555.47 1,365,998,591.00 31,737,353.10 1,334,261,237.90
144
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Raw materials 1,306,660.68 489,471.79 817,188.89 1,157,601.08 506,000.68 651,600.40
Inventory good 54,416.03 54,416.03 37,870.66 37,870.66
Low-value
consumption 174,148.37 174,148.37 180,774.01 180,774.01
goods
Total 1,190,512,376.99 8,749,845.32 1,181,762,531.67 1,889,563,802.27 38,891,757.91 1,850,672,044.36
Disclose main items of R&D expenses and interest capitalization thereof as the following format:
Unit: RMB
Shifted Increase Of which:
Other Accumula
Estimated Estimated developin (Costs of amount of
Date of decreased tive
Name of date of total Beginnin g developm Ending capitalize Capital
commenc sums for amount of
project completio investmen g balance properties ent) for balance d interests resources
ement this capitalize
n t for this this for this
period d interests
period period period
Shenzhen
Properties
& 1 March 30 April 1,595,600 400,891,6 217,725,1 618,616,8 3,882,239
23,367.37 Other
Resources 2014 2019 ,000.00 67.55 78.68 46.23 .73
Jinling
Holiday
Fuchang 29
30 June 969,290,0 6,024,627 827,036.5 6,851,663
Garden December Other
2021 00.00 .11 4 .65
Phase II 2018
Hainan
6,648,404 6,648,404
Qiongsha Other
.13 .13
n Land
Shenhui
36,966,04 37,002,03
Garden 35,990.00 Other
0.89 0.89
Land
Shenzhen
Properties
& 30
31 July 170,000,0 71,658,22 71,739,68
Resources December 81,456.30 Other
2020 00.00 5.84 2.14
Banshan 2018
yujing
Phase II
2,734,890 522,188,9 218,669,6 740,858,6 3,882,239
Total -- -- 23,367.37 --
,000.00 65.52 61.52 27.04 .73
Disclosing main items of ―Developing properties‖ in the following format:
Unit: RMB
145
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Accumulative Of which: amount
Name of Date of Beginning amount of of capitalized
Increase Decrease Ending balance
project completion balance capitalized interests for this
interests period
Internationa
l Trade 1 December
4,839,083.10 4,839,083.10
Center 1995
Plaza
Huangyuyu
1 June 2001 790,140.58 790,140.58
an A Area
Podium
1
Building of
November 645,532.65 645,532.65
Fuchang
1999
Building
Shenzhen
Properties
&
1 December
Resources 27,154,592.60 15,637,396.49 11,517,196.11
2012
Langqiao
Internationa
l
Shenzhen
Properties
&
Resources 1 June 2015 99,025,705.00 25,204,143.59 73,821,561.41 10,446,911.43
Hupan
Yujing
Phase I
Shenzhen
Properties
&
1 January 240,944,014.8 189,764,951.7
Resources 51,179,063.15 14,633,486.15
2016 5 0
Front Sea
Harbor
Garden
Shenzhen
Properties
& 1
179,738,838.0 112,079,650.6
Resources November 67,659,187.47 27,205,315.95
8 1
Banshan 2016
Yujing
Phase I
146
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Shenzhen
Properties
& 156,800,740.0
1 July 2017 88,701,712.72 68,099,027.29 30,539,392.65
Resources 1
Songhu
Langyuan
Shenzhen
Properties
1
& 652,331,580.6 486,449,246.6
November 165,839,369.65
Resources 7 3
2017
Hupanyujin
g Phase II
Other
3,728,363.46 3,728,363.46 83,077,702.96
projects
1,365,998,591. 917,837,101.7
Total -- 448,118,524.87 165,902,809.14
00 4
Classification of ―Developing properties with the collection of payments in installments‖, ―Renting developing properties‖ and
―Temporary Housing‖:
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Whether the Company need satisfy relevant disclosure requirements stated in SZSE Industrial Information Disclosure Guidance
No.11-Listed Company Specialized in Jewelry-related Business or not?
No
(2) Falling Price Reserves of Inventories
Disclosure of falling provision withdrawal of inventory in the following format:
Classified by nature:
Unit: RMB
Increase Decrease
Beginning
Item Reverse or Ending balance Note
balance Withdrawal Other Other
write-off
Costs of 6,648,404.
6,648,404.13
development 13
Developing 31,737,353
30,125,383.70 1,611,969.40
properties .10
Raw materials 506,000.68 16,528.89 489,471.79
38,891,757
Total 30,141,912.59 8,749,845.32 --
.91
Classification by main project:
147
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Unit: RMB
Increase Decrease
Beginning
Name of project Reverse or Ending balance Remarks
balance Withdrawal Other Other
write-off
Hainan 6,648,404.
6,648,404.13
Qiongshan Land 13
Shenzhen
Properties & 21,839,690
20,227,720.70 1,611,969.40
ResourcesBansh .10
an Yujing Phase I
Shenzhen
Properties & 9,897,663.
9,897,663.00 0.00
ResourcesHupan 00
Yujing Phase I
38,385,757
Total 30,125,383.70 8,260,373.53 --
.23
(3) Notes to the Ending Balance of Inventories Including Capitalized Borrowing Expense
The ending balance of the inventory included a total amount of the capitalized borrowings of RMB13,465,231.16,
details were listed as follows:
Item Period-begin Reporting Period Carry-over in Period-end
current period
Banshan Yujing I 7,207,754.95 -- 4,922,621.25 2,285,133.71
Qianhai Gangwan 5,031,818.17 -- 3,962,152.57 1,069,665.60
Golden Collar‘s Resort 3,858,872.36 23,367.37 -- 3,882,239.73
Songhu Langyuan 4,504,890.24 -- 3,388,797.28 1,116,092.96
Langqiao International 4,655,259.52 -- 1,683,272.97 2,971,986.54
Hupan Yujing I 2,897,207.03 -- 757,094.41 2,140,112.62
Total 28,155,802.27 23,367.37 14,713,938.48 13,465,231.16
(4) Inventory Limit
Disclosed by project
Unit: RMB
Name of project Beginning balance Ending balance Reason for the Limit
Guarantee for property
Completed development product 4,839,083.09 0.00
conservation
148
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total 4,839,083.09 0.00 --
(5) Completed but Unsettled Assets Generated from Construction Contacts at the Period-end
Unit: RMB
Item Amount
Other notes:
Not applicable
Whether the Company needs to comply with the disclosure requirements of Guideline No. 4 of the Shenzhen Stock Exchange on the
Industrial Information Disclosure about Listed Companies’ Engagement in Seed Industry and Planting Industry
No
8. Held-for-sale Assets
Unit: RMB
Estimated disposal
Item Ending carrying value Fair value Estimated disposal time
expense
Other notes:
Not applicable
9. Current Portion of Non-current Assets
Unit: RMB
Item Ending balance Beginning balance
Other notes:
Not applicable
10. Other Current Assets
Unit: RMB
Item Ending balance Beginning balance
1. Assets group (investment to Hainan
Xinda and accounts receivable) held to
cancel after verification
Of which: original value of assets
69,437,140.28 69,437,140.28
group
Depreciation reserves of the assets
-69,437,140.28 -69,437,140.28
group
2. Assets group (investment to Nanpeng
Papermaking and accounts receivable)
held to cancel after verification
149
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Of which: original value of assets
21,949,664.00 21,949,664.00
group
Depreciation reserves of the assets
-21,949,664.00 -21,949,664.00
group
3. Assets group (investment to
International Trade Industry and accounts
receivable) held to cancel after verification
Of which: original value of assets
6,034,625.03 6,034,625.03
group
Depreciation reserves of the assets
-6,034,625.03 -6,034,625.03
group
4. Assets group (accounts receivable from
Jintian Industry) held to cancel after
verification and other accounts receivable
Of which: original carrying value of
53,034,143.94 53,034,143.94
other receivables
Bad debt provision -53,034,143.94 -53,034,143.94
5. Assets group (accounts receivable from
Shenzhen Shengfeng Road, Guomao Jewel
& Gold Co., Ltd.) held to cancel after
verification and other accounts receivable
Of which: original carrying value of
6,980,273.01
other receivables
Bad debt provision -6,980,273.01
6. Pre-paid VAT 16,644,131.80 12,301,387.50
7. Deducted input tax 50,276.32 69,433.47
Total 16,694,408.12 12,370,820.97
Other notes:
11. Available-for-sale Financial Assets
(1) List of Available-for-sale Financial Assets
Unit: RMB
Ending balance Beginning balance
Item Carrying Depreciation Carrying Depreciation
Carrying value Carrying value
amount reserves amount reserves
Available-for-sale equity
20,704,235.10 17,082,853.99 3,621,381.11 20,462,995.80 16,871,786.60 3,591,209.20
instruments:
150
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Measured at fair
3,621,381.11 3,621,381.11 3,591,209.20 3,591,209.20
value
Total 17,082,853.99 17,082,853.99 16,871,786.60 16,871,786.60
Total 20,704,235.10 17,082,853.99 3,621,381.11 20,462,995.80 16,871,786.60 3,591,209.20
(2) Available-for-sale Financial Assets Measured by Fair Value at the Period-end
Unit: RMB
Available-for-sale equity Available-for-sale debt
Category Total
instruments instruments
Fair value 3,621,381.11 3,621,381.11
Depreciation amount
0.00 0.00
withdrawn
(3) Available-for-sale Financial Assets Measured by Cost at the Period-end
Unit: RMB
Carrying amount Depreciation reserves Shareholdi Cash
ng bonus of
Investee Period-beg Period-beg proportion the
Increase Decrease Period-end Increase Decrease Period-end
inning inning among the Reporting
investees Period
North
Machinery 3,465,000. 3,465,000. 3,465,000. 3,465,000.
12.66%
(Group) 00 00 00 00
Co., Ltd.
Guangdon
g Huayue
8,780,645. 8,780,645. 8,780,645. 8,780,645.
Real 8.47%
20 20 20 20
Estate Co.,
Ltd.
Sanya East
Travel 230,500.00 230,500.00 230,500.00 230,500.00 0.28%
Co., Ltd.
Shensan
17,695.09 17,695.09 17,695.09 17,695.09
Co., Ltd.
Macao
Huashen
81,155.34 3,912.62 85,067.96 81,155.34 3,912.62 85,067.96 10.00%
Enterprise
Co., Ltd.
151
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Chongqing
Guangfa
Real estate 2,462,546. 2,581,269. 2,462,546. 2,581,269.
118,723.07 118,723.07 27.25%
developme 35 42 35 42
nt Co.,
Ltd.
Saipan 1,834,244. 1,922,676. 1,834,244. 1,922,676.
88,431.70 88,431.70 30.00%
Project 62 32 62 32
16,871,786 17,082,853 16,871,786 17,082,853
Total 211,067.39 211,067.39 --
.60 .99 .60 .99
(4) Changes in Depreciation of Available-for-sale Financial Assets during the Reporting Period
Unit: RMB
Available-for-sale equity Available-for-sale debt
Category Total
instruments instruments
Withdrawn impairment
balance at the 16,871,786.60 16,871,786.60
period-begin
Withdrawal in the
211,067.39 211,067.39
Reporting Period
Withdrawn impairment
17,082,853.99 17,082,853.99
balance at the period-end
(5) Notes to the Available-for-sale Equity Instrument with Serious Fall or Non-transient Fall in Ending Fair
Value but without Provisions for Impairment
Unit: RMB
Item of
Falling scope of Withdrawn Reason for not
available-for-sale Duration of
Investment cost Ending fair value fair value against impairment withdrawing the
equity falling (month)
the cost amount impairment
instruments
Other notes
Note: The available-for-sale financial assets measured in fair value held by the Company were based on the final execution of The
Reorganization Plan of Gintian Industry (Group) Co., Ltd, the Company received 772,717 tradable A shares, 412,123 non-tradable A
shares and 447,217 B shares distributed by Gintian Industry on 26 January 2016, received 163,488 tradable A shares, 83,239
non-tradable A shares and 92,238 B shares additionally distributed on 15 March 2017. The cost of available-for-sale financial assets
was recognized based on the price issued on the last trading date before the trading suspension of Gintian Industry (10 December
2014), RMB2.09 per A share and US$0.17 per B share.
The changes in long-term equity investment in Macao Huashen Enterprise Co., Ltd., Saipan Project and Chongqing Guangfa Real
Estate Development Co., Ltd. and changes in depreciation reserves during the Reporting Period were caused by translation of foreign
currency statements.
152
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
12. Held-to-maturity Investments
(1) List of Held-to-maturity Investments
Unit: RMB
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
(2) Significant Held-to-maturity Investments at the Period-end
Unit: RMB
Item Par value Coupon rate Actual interest rate Due date
(3) Re-classified Held-to-maturity Investments during the Reporting Period
Not applicable
Other notes
Not applicable
13. Long-term Receivables
(1) List of Long-term Receivables
Unit: RMB
Ending balance Beginning balance
Interval of
Item Carrying Bad debt Carrying Bad debt
Carrying value Carrying value discount rate
amount provision amount provision
(2) Derecogniziton of Long-term Receivables due to the Transfer of Financial Assets
Not applicable
(3) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of
Long-term Receivables
Not applicable
Other notes
Not applicable
14. Long-term Equity Investments
Unit: RMB
153
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Increase/decrease
Ending
Gains and Adjustme
Cash Withdraw balance
Additiona losses nt of
Beginnin Reduced Changes bonus or al of Ending of
Investees l recognize other
g balance investmen of other profits depreciati Other balance depreciati
investmen d under comprehe
t equity announce on on
t the equity nsive
d to issue reserves reserves
method income
I. Joint ventures
Jifa
Warehous 33,498,61 605,227.6 34,103,84
e Co., 2.76 4 0.40
Ltd.
Shenzhen
Tian‘an
Internatio
nal
5,231,780 663,662.6 5,895,442
Building
.20 4 .84
Property
Managem
ent Co.,
Ltd.
38,730,39 1,268,890 39,999,28
Subtotal
2.96 .28 3.24
II. Associated enterprises
Shenzhen
Wufang
Pottery & 18,983,61 18,983,61 18,983,61
Porcelain 4.14 4.14 4.14
Industrial
Co., Ltd.
18,983,61 18,983,61 18,983,61
Subtotal
4.14 4.14 4.14
57,714,00 1,268,890 58,982,89 18,983,61
Total
7.10 .28 7.38 4.14
Other notes
154
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
15. Investment Property
(1) Investment Property Adopting the Cost Measurement Mode
√ Applicable □ Not applicable
Unit: RMB
Item Houses and buildings Land use right Construction in progress Total
I. Original carrying value
1. Beginning balance 682,062,541.24 3,885,469.40 685,948,010.64
2. Increased amount of
10,554,632.04 10,554,632.04
the period
(1) Outsourcing
(2) Transfer from
inventory\fixed
9,998,266.97 9,998,266.97
assets\construction in
progress
(3) Enterprise
combination increase
(4) Influence of the
translation of foreign
556,365.07 556,365.07
currency denominated
financial statements
3. Decreased amount of
18,707,710.55 18,707,710.55
the period
(1) Disposal
(2) Other transfer 18,707,710.55 18,707,710.55
4. Ending balance 673,909,462.73 3,885,469.40 677,794,932.13
II. Accumulative
depreciation and
accumulative
amortization
1. Beginning balance 255,751,372.33 3,347,080.26 259,098,452.59
2. Increased amount of
23,695,879.13 373,005.12 24,068,884.25
the period
(1) Withdrawal or
23,695,879.13 373,005.12 24,068,884.25
amortization
3. Decreased amount of 5,923,094.61 5,923,094.61
155
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
the period
(1) Disposal
(2) Other transfer 5,923,094.61 5,923,094.61
4. Ending balance 273,524,156.85 3,720,085.38 277,244,242.23
III. Depreciation reserves
1. Beginning balance
2. Increased amount of
the period
(1) Withdrawal
3. Decreased amount of
the period
(1) Disposal
(2) Other transfer
4. Ending balance
IV. Carrying value
1. Ending carrying value 400,385,305.88 165,384.02 400,550,689.90
2. Beginning carrying
426,311,168.91 538,389.14 426,849,558.05
value
(2) Investment Property Adopting the Fair Value Measurement Mode
□ Applicable √ Not applicable
The Company needs to comply with the disclosure requirements of Guideline No. 3 of the Shenzhen Stock Exchange on the Industrial
Information Disclosure about Listed Companies’ Engagement in Real Estate Business
Investment properties measured in fair value by project disclosure:
Unit: RMB
Lease
Geographi income Reason for fair value
Building Beginning Range of fair
Name of project cal during this Ending fair value changes and report
area fair value value changes
location Reporting index
Period
Whether the Company has new investment properties measured in fair value
□ Yes √ No
156
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(3) Investment Property Failed to Accomplish Certification of Property
Unit: RMB
Item Carrying value Reason
Other notes
None
16. Fixed Assets
Unit: RMB
Item Ending balance Beginning balance
Fixed assets 32,612,592.40 29,346,901.33
Total 32,612,592.40 29,346,901.33
(1) List of Fixed Assets
Unit: RMB
Transportation Electronic
Houses and Decoration of the
Item equipment equipment and Total
buildings fixed assets
others
I. Original carrying
value
1. Beginning balance 92,775,910.74 9,058,794.34 15,771,409.46 4,163,727.48 121,769,842.02
2. Increased amount
6,953,263.39 3,374,107.40 2,722,242.78 13,049,613.57
of the period
(1) Purchase 3,374,107.40 2,722,242.78 6,096,350.18
(2) Transfer from
construction in
progress
(3) Enterprise
combination increase
(4) Influence of the
translation of foreign
currency 257,476.50 257,476.50
denominated
financial statements
(5) Transfer of
investment 6,695,786.89 6,695,786.89
properties
157
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
3. Decreased amount
2,782,085.00 1,063,185.59 3,845,270.59
of the period
(1) Disposal or Scrap 2,782,085.00 1,063,185.59 3,845,270.59
4. Ending balance 99,729,174.13 9,650,816.74 17,430,466.65 4,163,727.48 130,974,185.00
II. Accumulative
depreciation
1. Beginning balance 69,068,851.85 7,460,443.52 11,948,746.10 3,869,182.06 92,347,223.53
2. Increased amount
7,353,945.74 811,728.33 1,208,545.61 201,569.37 9,575,789.05
of the period
(1) Withdrawal 2,048,913.53 811,728.33 1,208,545.61 201,569.37 4,270,756.84
(2) Transfer of
investment 5,305,032.21 5,305,032.21
properties
3. Decreased amount
2,642,980.75 994,156.39 3,637,137.14
of the period
(1) Disposal or Scrap 2,642,980.75 994,156.39 3,637,137.14
4. Ending balance 76,422,797.59 5,629,191.10 12,163,135.32 4,070,751.43 98,285,875.44
III. Depreciation
reserves
1. Beginning balance 75,717.16 75,717.16
2. Increased amount
of the period
(1) Withdrawal
3. Decreased amount
of the period
(1) Disposal or Scrap
4. Ending balance 75,717.16 75,717.16
IV. Carrying value
1. Ending carrying
23,306,376.54 4,021,625.64 5,191,614.17 92,976.05 32,612,592.40
value
2. Beginning
23,707,058.89 1,598,350.82 3,746,946.20 294,545.42 29,346,901.33
carrying value
158
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(2) List of Temporarily Idle Fixed Assets
Unit: RMB
Original carrying Accumulative Depreciation
Item Carrying value Note
value depreciation reserves
Houses and
4,059,207.77 2,522,507.21 1,536,700.56
buildings
(3) Fixed Assets Leased in by Financing Lease
Unit: RMB
Accumulative
Item Original carrying value Depreciation reserves Carrying value
depreciation
(4) Fixed Assets Leased out by Operation Lease
Unit: RMB
Item Ending carrying value
(5) Fixed Assets Failed to Accomplish Certification of Property
Unit: RMB
Item Carrying value Reason
Other notes
Not applicable
(6) Proceeds from Disposal of Fixed Assets
Unit: RMB
Item Ending balance Beginning balance
Other notes
Not applicable
17. Construction in Progress
Unit: RMB
Item Ending balance Beginning balance
(1) List of Construction in Progress
Unit: RMB
159
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
(2) Changes in Significant Construction in Progress during the Reporting Period
Unit: RMB
Of
Proporti
which:
on of Accumul Capitaliz
amount
accumul ated ation rate
Transferr of
Beginnin Other ated amount of
Increase ed in Ending Job capitaliz Capital
Item Budget g decrease investme of interests
d amount fixed balance schedule ed resources
balance d amount nt in interest for the
assets interests
construct capitaliz Reportin
for the
ions to ation g Period
Reportin
budget
g Period
(3) List of the Withdrawal of the Depreciation Reserves for Construction in Progress
Unit: RMB
Item Amount withdrawn Reason for withdrawal
Other notes
Not applicable
(4) Engineering Materials
Unit: RMB
Ending balance Beginning balance
Item Depreciation Carrying Depreciation
Carrying amount Carrying value Carrying value
reserves amount reserves
Other notes：
Not applicable
18. Productive Living Assets
(1) Productive Living Assets Adopting Cost Measurement Mode
□ Applicable √ Not applicable
160
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(2) Productive Living Assets Adopting Fair Value Measurement Mode
□ Applicable √ Not applicable
19. Oil and Gas Assets
□ Applicable √ Not applicable
20. Intangible Assets
(1) List of Intangible Assets
Unit: RMB
Item Land use right Patent right Non-patent right Total
I. Original carrying
value
1. Beginning balance
2. Increased amount
of the period
(1) Purchase
(2) Internal R&D
(3) Business
combination increase
3. Decreased amount
of the period
(1) Disposal
4. Ending balance
II. Accumulated
amortization
1. Beginning balance
2. Increased amount
of the period
(1) Withdrawal
3. Decreased amount
of the period
(1) Disposal
161
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
4. Ending balance
III. Depreciation
reserves
1. Beginning balance
2. Increased amount
of the period
(1) Withdrawal
3. Decreased amount
of the period
(1) Disposal
4. Ending balance
IV. Carrying value
1. Ending carrying
value
2. Beginning
carrying value
The proportion of intangible assets formed from the internal R&D of the Company at the Period-end to the ending balance of
intangible assets was.
(2) Land Use Right with Certificate of Title Uncompleted
Unit: RMB
Item Carrying value Reason
Other notes：
Not applicable
21. R&D Expense
Unit: RMB
Beginning Ending
Item Increase Decrease
balance balance
Other notes
Not applicable
162
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
22. Goodwill
(1) Original Carrying Value of Goodwill
Unit: RMB
Name of the
invested units or Beginning
Increase Decrease Ending balance
events generating balance
goodwill
(2) Depreciation Reserves of Goodwill
Unit: RMB
Name of the
invested units or Beginning
Increase Decrease Ending balance
events generating balance
goodwill
Information on the assets group or combination of assets groups which goodwill belongs to
Not applicable
Notes of the testing process of goodwill impairment, parameters (such as growth rate of the forecast period, growth rate of stable
period, rate of profit, discount rate, forecast period and so on for prediction of future present value of cash flows) and the recognition
method of goodwill impairment losses:
Not applicable
Influence of goodwill impairment testing
Not applicable
Other notes
Not applicable
23. Long-term Prepaid Expense
Unit: RMB
Amortization Other decreased
Item Beginning balance Increased amount Ending balance
amount of the period amount
Facilities
reconstruction 951,368.85 1,084,305.07 228,935.63 1,806,738.29
expenses
Rental fees 998,070.00 406,232.00 591,838.00
Total 951,368.85 2,082,375.07 635,167.63 2,398,576.29
Other notes
163
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
24. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets that Had not Been Set-off
Unit: RMB
Ending balance Beginning balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Provision for impairment
126,743,538.44 31,553,045.99 127,814,574.78 31,824,813.21
of assets
Internal unrealized profit 52,189,819.68 13,047,454.92 50,232,811.52 12,558,202.88
Deductible losses 657,498,958.12 164,374,739.53 325,096,396.59 81,274,099.15
Accrued land VAT 1,204,912,500.44 301,228,125.11 1,048,229,108.99 262,057,277.25
Estimated profit
calculated at pre-sale
38,294,088.60 9,573,522.15 1,158,823.50 289,705.88
revenue of property
enterprises
Payroll payable unpaid
26,575.76 6,643.94 71,997.16 17,999.27
but withdrawn
Total 2,079,665,481.04 519,783,531.64 1,552,603,712.54 388,022,097.64
(2) Deferred Income Tax Liabilities Had Not Been Off-set
Unit: RMB
Ending balance Beginning balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference liabilities difference liabilities
The carrying value of
fixed assets was larger 21,102.40 5,275.60 34,664.60 8,668.15
than the tax basis
Total 21,102.40 5,275.60 34,664.60 8,668.15
(3) Deferred Income Tax Assets or Liabilities Listed by Net Amount after Off-set
Unit: RMB
Mutual set-off amount of Ending balance of Mutual set-off amount of Beginning balance of
deferred income tax deferred income tax deferred income tax deferred income tax
Item
assets and liabilities at assets or liabilities after assets and liabilities at assets or liabilities after
the period-end off-set the period-begin off-set
Deferred income tax 519,783,531.64 388,022,097.64
164
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
assets
Deferred income tax
5,275.60 8,668.15
liabilities
(4) List of Unrecognized Deferred Income Tax Assets
Unit: RMB
Item Ending balance Beginning balance
Deductible losses 116,064,336.25 264,391,115.35
Estimated profit calculated at pre-sale
2,535,696.30 72,335,705.85
revenue of property enterprises
Internal unrealized profit 2,427,381.29 15,134,932.80
Provision for assets impairment 212,156,220.23 241,361,068.56
Total 333,183,634.07 593,222,822.56
(5) Deductible Losses of Unrecognized Deferred Income Tax Assets will Due in the Following Years
Unit: RMB
Years Ending amount Beginning amount Notes
Y2018 8,320,354.75 The deductible losses of 2013
Y2019 7,443.23 4,766,878.24 The deductible losses of 2014
Y2020 2,221,261.56 4,461,538.13 The deductible losses of 2015
Y2021 5,397,820.20 6,158,740.02 The deductible losses of 2016
Y2022 108,437,811.26 240,683,604.21 The deductible losses of 2017
Y2023 The deductible losses of 2018
Total 116,064,336.25 264,391,115.35 --
Other notes：
None
25. Other Non-current Assets
Unit: RMB
Item Ending balance Beginning balance
Prepayment for purchase of fixed assets,
8,971,942.00
investment properties and intangible assets
Prepayment for acquisition of long-term
100,000,000.00
equity investment
Total 108,971,942.00
165
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Other notes：
Note: On 11 August 2018, the Company signed the framework agreement with Shenzhen Xinhai Rongyao Real Estate Development
Co., Ltd. to purchase 69% of shares in Shenzhen Rongyao Real Estate Development Co., Ltd., the subsidiary of Shenzhen Xinhai
Rongyao Real Estate Development Co., Ltd. As stipulated in the agreement, the Company shall pay a subscription of RMB0.1 billion
and that subscription will be deducted from the transaction consideration as one part of transfer money for shares after signing the
formal transaction document.
26. Short-term Borrowings
(1) Category of Short-term Borrowings
Unit: RMB
Item Ending balance Beginning balance
Notes of short-term borrowings category:
Not applicable
(2) List of the Short-term Borrowings Overdue but Not Returned
The amount of the overdue unpaid short-term borrowings at the period-end was of RMBXXX, of which the significant overdue
unpaid short-term borrowings are as follows:
Unit: RMB
Borrower Ending balance Interest rate Overdue time Overdue charge rate
Other notes：
Not applicable
27. Financial Liabilities at Fair Value through Profit or Loss
Unit: RMB
Item Ending balance Beginning balance
Other notes：
Not applicable
28. Derivative Financial Liabilities
□ Applicable √ Not applicable
29. Notes Payable and Accounts Payable
Unit: RMB
Item Ending balance Beginning balance
Accounts payable 398,429,855.96 491,963,303.62
166
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total 398,429,855.96 491,963,303.62
(1) Notes Payable Listed by Category
Unit: RMB
Category Ending balance Beginning balance
The total amount of the due but not paid notes payable at the end of the period was of RMBXXX.
(2) List of Accounts Payable
Unit: RMB
Item Ending balance Beginning balance
Within 1 year 129,232,449.39 210,969,598.73
1 to 2 years 203,704,187.53 197,803,229.69
2 to 3 years 13,191,433.56 17,921,262.66
Over 3 years 52,301,785.48 65,269,212.54
Total 398,429,855.96 491,963,303.62
(3) Significant Accounts Payable Aging over One Year
Unit: RMB
Item Ending balance Unpaid/ Un-carry-over reason
The Second Construction Co., Ltd. of
China Construction Third Engineering 81,258,600.00 Unsettled
Bureau
Jinchen Group Limited Company 50,634,299.28 Unsettled
Jiangsu Hanjian Group Co.,Ltd. 32,324,917.24 Unsettled
Shenzhen Luohu District Land and
25,000,000.00 Unsettled
Resources Bureau
Henan First Construction Engineering
14,028,734.51 Unsettled
Group Co., Ltd.
Total 203,246,551.03 --
Other notes：
There were no accounts payable for any related parties or shareholding entities holding shares of the Company with over 5%
(including 5%) of voting rights in the accounts payable for the Reporting Period.
167
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
30. Advances from Customers
(1) List of Advances from Customers
Unit: RMB
Item Ending balance Beginning balance
Within 1 year 262,553,420.13 278,516,155.14
1-2 years 2,031,091.19 236,833,304.63
2-3 years 510,000.00 898,707.77
Over 3 years 243,704.02 736,543.57
Total 265,338,215.34 516,984,711.11
(2) Significant Advances from Customers Aging over One Year
Unit: RMB
Item Ending balance Unpaid/ Un-carry-over reason
(3) Settled but Uncompleted Projects Formed by Construction Contracts at the Period-end
Unit: RMB
Item Amount
Other notes：
There were no advances from any related parties or shareholding entities holding shares of the Company with over 5% (including 5%)
of voting rights in the advances from customers for the Reporting Period.
The advances from customers aging over one year were mainly the advances from home buyers without obtaining their homes yet.
The Company is required to comply with the disclosure requirements stipulated in Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No. 3-Listed Company Engaged in Property Development
Prepayment of the top 5 sale of real estate projects:
Unit: RMB
Estimate finished
No. Item Beginning balance Ending balance Presale proportion
time
SZPRD-Golden
1 0.00 89,772,140.00 30 April 2019 2.63%
Collar‘s Resort
SZPRD –Qianhai
2 4,981,735.00 75,538,532.00 30 October 2016 92.69%
Gangwan
SZPRD –Songhu
3 604,765.00 51,299,542.00 31 July 2017 96.34%
Langyuan
SZPRD –Hupan
4 455,923,289.00 8,687,567.00 30 November 2017 73.36%
Yujing II
168
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
SZPRD –Banshan
5 18,346,748.00 6,222,099.00 30 November 2016 91.78%
Yujing I
31. Payroll Payable
(1) List of Payroll Payable
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
I. Short-term salary 91,496,562.39 348,224,773.29 344,137,746.24 95,583,589.44
II. Post-employment
benefit-defined 477,112.15 27,282,419.99 27,273,600.04 485,932.10
contribution plans
III. Termination benefits 92,800.00 2,929,719.63 3,022,519.63
IV. Current portion of
49,569.54 49,569.54
other welfares
Total 92,066,474.54 378,486,482.45 374,483,435.45 96,069,521.54
(2) List of Short-term Salary
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
1. Salary, bonus,
83,449,073.72 303,400,997.89 300,819,367.28 86,030,704.33
allowance, subsidy
2. Employee welfare 14,248,642.80 14,248,612.80 30.00
3. Social insurance 254.95 11,198,952.30 11,199,207.25
Of which: Medical
9,937,506.45 9,937,506.45
insurance premiums
Work-re
544,251.87 544,251.87
lated injury insurance
Materni
254.95 676,743.93 676,998.88
ty insurance
Other social security
40,450.05 40,450.05
charges
4. Housing fund 504,216.12 8,654,244.64 8,675,162.21 483,298.55
5. Labor union budget
and employee education 7,543,017.60 8,643,309.69 7,116,770.73 9,069,556.56
budget
8. Other short-term 2,078,625.97 2,078,625.97
169
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
salary
Total 91,496,562.39 348,224,773.29 344,137,746.24 95,583,589.44
(3) List of Defined Contribution Plans
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
1. Basic pension benefits 477,112.15 22,433,456.77 22,424,636.82 485,932.10
2. Unemployment
664,978.33 664,978.33
insurance
3. Annuity 4,183,984.89 4,183,984.89
Total 477,112.15 27,282,419.99 27,273,600.04 485,932.10
Other notes：
The Company, in line with the requirement, participate the endowment insurance, unemployment insurance scheme and so on,
according to the scheme, the Company monthly pay to the scheme in line with 14% and 1% of the endowment insurance base, except
the monthly payment, the Company no longer shoulder the further payment obligation, the relevant expense occurred was recorded
into current profits and losses or related assets costs.
32. Taxes Payable
Unit: RMB
Item Ending balance Beginning balance
VAT 43,456,567.41 6,311,231.88
Corporate income tax 299,844,086.29 135,064,846.34
Personal income tax 727,690.79 829,379.86
Urban maintenance and construction tax 2,041,413.19 317,880.65
Stamp tax 11,902.61 36,803.91
Education Surcharge 893,767.33 144,949.71
Local education surtax 603,356.32 105,286.00
Land VAT 1,205,033,788.57 1,048,229,108.99
Property tax 48,545.74 1,097,050.21
Other 59,512.34 450,719.11
Total 1,552,720,630.59 1,192,587,256.66
Other notes：
33. Other Payables
Unit: RMB
170
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Item Ending balance Beginning balance
Interest payable 1,669.10
Dividends payable 29,642.40 29,642.40
Other payables 112,470,835.19 122,592,357.98
Total 112,502,146.69 122,622,000.38
(1) Interest Payable
Unit: RMB
Item Ending balance Beginning balance
Interest of long-term borrowings with
installment payments of interest and 1,669.10
payment of principal at maturity
Total 1,669.10
List of the significant overdue unpaid interest:
Unit: RMB
Borrower Overdue amount Overdue reasons
Other notes：
Not applicable
(2) Dividends Payable
Unit: RMB
Item Ending balance Beginning balance
Ordinary share dividends 29,642.40 29,642.40
Total 29,642.40 29,642.40
Other notes, including significant dividends payable unpaid for over one year, the unpaid reason shall be disclosed:
Name Shares Amount of dividends Note
payable
Shenzhen South China Investment 54,840.00 9,871.20 Without access to its
Development Co., Ltd. account
Wenling Quality Control Association 54,839.00 9,871.02 Without access to its
account
Shanghai Weihong Industry & Trade Co., Ltd. 55,000.00 9,900.00 Without access to its
account
China Shenzhen International Cooperation 1.00 0.18 Without access to its
(Group) Co., Ltd. account
Total 164,680.00 29,642.40
171
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Note: On 21 April 2017, the Company reviewed and approved the Proposal on 2016 Profit Distribution Plan and Bonus Issue from
Capital Reserves on the 2016 Annual General Meeting and decided to distribute the dividends to all shareholders at RMB1.80 per ten
shares in cash based on the total 595,979,092 shares of share capital. As of the end of the Reporting Period, there was still four
shareholders who could not be distributed their dividends due to no access to their effective accounts.
(3) Other Payables
1) Other Payables Listed by Nature
Unit: RMB
Item Ending balance Beginning balance
Guarantee deposit 25,366,966.93 23,563,482.44
Cash deposit 10,150,566.03 10,920,996.03
Agency fund 26,902,808.40 35,176,474.28
Intercourse fund 35,881,368.64 34,481,368.64
Accrued expenses 4,641,226.43 7,057,227.97
Payment on behalf 4,410,942.10 394,048.71
Other 5,116,956.66 10,998,759.91
Total 112,470,835.19 122,592,357.98
2) Significant Other Payables Aging over One Year
Unit: RMB
Item Ending balance Unpaid/Un-carry-over reason
Come-and-go accounts without specific
Shenzhen Jifa Warehouse Co., Ltd. 26,296,665.14
payment term
Shenzhen Tian‘an International Building Come-and-go accounts without specific
5,214,345.90
Property Management Co., Ltd. payment term
Margin of sporadic lease 6,747,724.03 Margin within the leasing period
Rainbow Co., Ltd. 2,380,000.00 Margin within the leasing period
Shenzhen Branch of CPIC 1,022,842.00 Margin within the leasing period
Total 41,661,577.07 --
Other notes
None
34. Held-for-sale Liabilities
Unit: RMB
Item Ending balance Beginning balance
Other notes：
Not applicable
172
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
35. Current Portion of Non-current Liabilities
Unit: RMB
Item Ending balance Beginning balance
Other notes：
Not applicable
36. Other Current Liabilities
Unit: RMB
Item Ending balance Beginning balance
Increase/decrease of the short-term bonds payable:
Unit: RMB
Amortizat
Withdraw
ion of Repayme
The al of
Bonds Issuing Issuing Beginnin premium nt in the Ending
Par value Duration current interest
name date amount g balance and Reporting balance
issue by par
depreciati Period
value
on
Other notes：
Not applicable
37. Long-term Borrowings
(1) Category of Long-term Borrowings
Unit: RMB
Item Ending balance Beginning balance
Guaranteed borrowings 1,000,000.00
Total 1,000,000.00
Notes to the category of long-term borrowings:
Other notes, including the interval of interest rate:
Bank providing loan Borrowings Borrowings Interest Currency Period-end
Start date End date rate (%) Foreign Domestic
currency currency
amount
Shenzhen Branch of Bank 20 July 2018 20 June 2021 5.4625 RMB -- 1,000,000.00
of Shanghai Co., Ltd.
173
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
38. Bonds Payable
(1) List of Bonds Payable
Unit: RMB
Item Ending balance Beginning balance
(2) Increase/Decrease of Bonds Payable (Excluding Other Financial Instrument Classified as Financial
Liabilities such as Preferred Shares and Perpetual Bonds)
Unit: RMB
(3) Notes to the Conditions and Time of the Shares Transfer of the Convertible Corporate Bonds
(4) Notes to Other Financial Instruments Classified as Financial Liabilities
Basic situation of other financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Changes in financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Unit: RMB
Outstanding Period-beginning Increase Decrease Period-end
financial Carrying Carrying Carrying Carrying
Amount Amount Amount Amount
instrument value value value value
Notes to basis for the classification of other financial instruments as financial liabilities
Other notes
Not applicable
39. Long-term Payables
Unit: RMB
Item Ending balance Beginning balance
(1) Long-term Payables Listed by Nature
Unit: RMB
Item Ending balance Beginning balance
Other notes：
(2) Specific Payables
Unit: RMB
Item Beginning balance Increase Decrease Ending balance Reason for
174
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
formation
Other notes：
Not applicable
40. Long-term Payroll Payable
(1) List of Long-term Payroll Payable
Unit: RMB
Item Ending balance Beginning balance
(2) Changes in Defined Benefit Plans
Obligation present value of defined benefit plans:
Unit: RMB
Item Reporting period Same period of last year
Plan assets:
Unit: RMB
Item Reporting period Same period of last year
Net liabilities (net assets) of defined benefit plans:
Unit: RMB
Item Reporting period Same period of last year
Notes of influence of content of defined benefit plans and its relevant risks to the future cash flow, time and uncertainty of the
Company:
Notes to the results of significant actuarial assumptions and sensitivity analysis of defined benefit plans:
Other notes：
Not applicable
41. Provisions
Unit: RMB
Item Ending balance Beginning balance Reason for formation
Other notes, including notes to related significant assumptions and evaluation of significant provisions:
Not applicable
42. Deferred Income
Unit: RMB
Reason for
Item Beginning balance Increase Decrease Ending balance
formation
175
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Item involving government subsidies:
Unit: RMB
Amount Amount
recorded into recorded into Amount
Amount of Related to
Beginning non-operatin other income offset cost in Other Ending
Item newly assets/related
balance g income in in the the Reporting changes balance
subsidy income
the Reporting Reporting Period
Period Period
Other notes：
Not applicable
43. Other Non-current Liabilities
Unit: RMB
Item Ending balance Beginning balance
Utility specific fund 237,163.63 237,163.63
Housing principle fund 11,702,533.73 14,107,346.01
House warming deposit 6,649,884.71 7,220,523.83
Electric Equipment Maintenance fund 4,019,415.44 4,019,415.44
Deputed Maintenance fund 28,374,344.95 27,687,597.11
Other 1,953,838.35 1,271,207.25
Total 52,937,180.81 54,543,253.27
Other notes：
None
44. Share Capital
Unit: RMB
Increase/decrease (+/-)
Beginning
New shares Bonus issue Ending balance
balance Bonus shares Other Subtotal
issued from profit
The sum of
595,979,092.00 595,979,092.00
shares
Other notes：
None
176
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
45. Other Equity Instruments
(1) The Basic Information of Other Financial Instruments such as Preferred Stock and Perpetual Bond
Outstanding at the End of the Period
Not applicable
(2) Changes in Financial Instruments such as Preferred Stock and Perpetual Bond Outstanding at the End
of the Period
Unit: RMB
Outstanding Period-beginning Increase Decrease Period-end
financial Carrying Carrying Carrying Carrying
Amount Amount Amount Amount
instruments value value value value
The current changes in other equity instruments and the corresponding reasons and the basis of the relevant accounting treatment
Not applicable
Other notes：
Not applicable
46. Capital Reserves
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Capital premium
38,450,087.51 38,450,087.51
(premium on stock)
Other capital reserves 80,488,045.38 80,488,045.38
Total 118,938,132.89 118,938,132.89
Other notes, including changes and reason of change:
None
47. Treasury Shares
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Other notes, including changes and reason of change:
Not applicable
48. Other Comprehensive Income
Unit: RMB
Item Beginning Reporting Period Ending
177
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
balance Less: recorded balance
in other
Attributable
comprehensive Attributable
Income to owners
income in to
before Less: of the
prior period non-control
taxation in Income tax Company
and transferred ling
the Current expense as the
in profit or interests
Period parent after
loss in the after tax
tax
Current
Period
II. Other comprehensive income that
2,325,405.4 2,325,405.4 -1,786,18
may subsequently be reclassified to -4,111,587.14
5 5 1.69
profit or loss
Differences arising from translation
2,325,405.4 2,325,405.4 -1,786,18
of foreign currency-denominated -4,111,587.14
5 5 1.69
financial statements
2,325,405.4 2,325,405.4 -1,786,18
Total of other comprehensive income -4,111,587.14
5 5 1.69
Other notes, including the adjustment of the effective gain/loss on cash flow hedges to the initial recognized amount:
49. Specific Reserve
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Other notes, including changes and reason of change:
Not applicable
50. Surplus Reserves
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Statutory surplus
299,569,569.96 299,569,569.96
reserves
Total 299,569,569.96 299,569,569.96
Notes, including changes and reason of change:
In line with provisions of Corporate Law and Articles of Association, the Company withdrew 10% of net profits as statutory surplus
reserves. When the accumulative statutory surplus reserves reach over 50% of the registered capital of the Company, no statutory
surplus reserves will be withdrawn.
After the withdrawal of statutory surplus reserves, the Company can withdraw the discretionary surplus reserves which can be used
to make up for losses of previous years or increase the share capital when approved.
178
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
51. Retained Earnings
Unit: RMB
Item Reporting Period Same period of last year
Beginning balance of retained earnings before
1,911,318,586.37 1,441,632,088.56
adjustments
Beginning balance of retained earnings after
1,911,318,586.37 1,441,632,088.56
adjustments
Add: Net profit attributable to owners of the
592,723,852.71 622,962,734.37
Company as the parent
Less: withdrawal of statutory surplus reserves 46,000,000.00
Dividend of ordinary shares payable 178,793,727.60 107,276,236.56
Ending retained earnings 2,325,248,711.48 1,911,318,586.37
List of adjustment of beginning retained earnings:
(1) RMB0.00 beginning retained earnings was affected by retrospective adjustment conducted according to the Accounting Standards
for Business Enterprises and relevant new regulations.
(2) RMB0.00 beginning retained earnings was affected by changes in accounting policies.
(3) RMB0.00 beginning retained earnings was affected by correction of significant accounting errors.
(4) RMB0.00 beginning retained earnings was affected by changes in combination scope arising from same control.
(5) RMB0.00 beginning retained earnings was affected totally by other adjustments.
52. Operating Revenue and Cost of Sales
Unit: RMB
Reporting Period Same Period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 2,723,996,545.39 1,294,560,011.00 2,851,768,386.62 1,609,336,288.38
Other operations 63,244,087.14 20,629,980.84 52,922,303.91 18,531,617.26
Total 2,787,240,632.53 1,315,189,991.84 2,904,690,690.53 1,627,867,905.64
The Company is required to comply with the disclosure requirements stipulated in Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No. 3-Listed Company Engaged in Property Development
The top 5 accounts received with confirmed amount in the Reporting Period:
Unit: RMB
No. Name of project Income balance
1 SZPRD-Qianhai Gangwan 1,213,469,382.80
2 SZPRD-Hupan Yujing II 554,867,040.56
3 SZPRD-Songhu Langyuan 247,296,018.72
179
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
4 SZPRD-Banshan Yujing I 122,209,577.13
5 SZPRD-Langqiao International 72,215,790.71
53. Taxes and Surtaxes
Unit: RMB
Item Reporting Period Same Period of last year
Urban maintenance and construction tax 8,542,191.66 9,234,208.58
Education Surcharge 3,765,265.53 4,403,393.23
Property tax 4,495,124.63 5,121,683.05
Land use tax 819,578.17 1,879,238.55
Business tax 1,115,668.20 68,915,815.45
Local education surtax 2,510,202.58 2,936,020.80
Land VAT 591,164,599.63 370,146,447.34
Other taxes 1,014,335.77 1,239,308.22
Total 613,426,966.17 463,876,115.22
Other notes：
Refer to Note VI Taxation for details.
54. Selling Expense
Unit: RMB
Item Reporting Period Same Period of last year
Employee‘s remuneration 4,024,373.52 4,790,260.31
Depreciation fees 68,637.22 70,363.20
Advertising 11,002,256.66 1,657,379.03
Office expenses 1,561,813.69 1,026,676.83
Business entertainment fees 667,915.85 696,049.45
Property fees 1,031,123.17 2,768,765.78
Consultancy and sales service charges 3,508,647.82 6,337,866.06
Article of consumption 353,706.00 520,602.12
Amortization of low-value consumption
204,838.19 91,070.68
goods
Agency fee 19,774,323.60 11,150,853.97
Vacancy charge 2,634,036.79 1,261,750.31
Other 1,669,552.67 807,555.59
180
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total 46,501,225.18 31,179,193.33
Other notes：
55. Administrative Expense
Unit: RMB
Item Reporting Period Same Period of last year
Employee‘s remuneration 70,389,976.43 95,553,096.76
Administrative office cost 21,708,292.73 21,621,558.85
Assets amortization and depreciation
3,640,986.34 5,174,960.73
expense
Litigation costs 155,176.40 6,374,637.65
Other 6,957,781.29 8,304,401.70
Total 102,852,213.19 137,028,655.69
Other notes：
56. R&D Expense
Unit: RMB
Item Reporting Period Same Period of last year
Other notes：
Not applicable
57. Finance Costs
Unit: RMB
Item Reporting Period Same Period of last year
Interest expense
Less: Interest income 58,627,284.65 25,827,011.83
Foreign exchange gains or losses 290,983.11 734,047.30
Other 756,768.97 685,508.15
Total -57,579,532.57 -24,407,456.38
Other notes：
58. Asset Impairment Loss
Unit: RMB
Item Reporting Period Same Period of last year
181
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
I. Bad debt loss -360,322.75 3,952,731.89
II. Loss on inventory valuation -6,565,809.22 -59,564,053.97
XIV. Other -1,085,618.78
Total -6,926,131.97 -56,696,940.86
Other notes：
Other refers to losses on deprecisation of other current assets.
59. Other Income
Unit: RMB
Sources Reporting Period Same period of last year
60. Investment Income
Unit: RMB
Item Reporting Period Same Period of last year
Long-term equity investment income
1,268,890.28 1,978,501.84
accounted by equity method
Investment income from disposal of long-term
620,130.83 104,895,528.48
equity investment
Total 1,889,021.11 106,874,030.32
Other notes：
61. Gain on Changes in Fair Value
Unit: RMB
Sources Reporting Period Same period of last year
Other notes：
Not applicable
62. Asset Disposal Income
Unit: RMB
Sources Reporting Period Same period of last year
Gains from disposal of non-current
-8,096.97 -11,772.11
assets(―-― means losses)
63. Non-operating Income
Unit: RMB
182
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Amount recorded in the current
Item Reporting Period Same Period of last year
non-recurring profit or loss
Total income from scrap of
13,571.33 13,571.33
non-current assets
Government subsidy not related
165,676.08 165,676.08
to routine activities of business
Compensation income 929,177.65 295,947.51 929,177.65
Other 3,750,718.74 1,463,947.32 3,750,718.74
Total 4,859,143.80 1,759,894.83 4,859,143.80
Government subsidies recorded into current profit or loss
Unit: RMB
Whether
influence the Special Related to
Distribution Distribution Reporting Same period
Item Nature profits or subsidy or assets/related
entity reason Period of last year
losses of the not income
year or not
Subsidy for
Related to
stabilizing Not Not 165,676.08 0.00
income
posts
Other notes：
None
64. Non-operating Expense
Unit: RMB
Amount recorded in the current
Item Reporting Period Same Period of last year
non-recurring profit or loss
Loss on damage and scrap of
84,963.94 84,963.94
non-current assets
Penalty and fine for delaying
1,806,353.15 92,327.19 1,806,353.15
payment
Other 1,149,525.83 7,625,422.97 1,149,525.83
Total 3,040,842.92 7,717,750.16 3,040,842.92
Other notes：
65. Income Tax Expense
(1) List of Income Tax Expense
Unit: RMB
183
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Item Reporting Period Same Period of last year
Current income tax expense 316,578,200.24 217,802,226.43
Deferred income tax expense -131,764,826.55 -14,017,340.03
Total 184,813,373.69 203,784,886.40
(2) Adjustment Process of Accounting Profit and Income Tax Expense
Unit: RMB
Item Reporting Period
Profit before taxation 777,475,125.71
Current income tax expense accounted at statutory/applicable tax
194,368,781.43
rate
Influence of applying different tax rates by subsidiaries -35,695.97
Influence of income tax before adjustment 751,191.04
Influence of non-deductable costs, expenses and losses 3,216,782.60
Influence of deductable loss of unrecognized deferred income tax
-4,019,160.74
assets in prior period
Influence of deductable temporary difference or deductable
losses of unrecognized deferred income tax in the Reporting -9,468,524.67
Period
Income tax expense 184,813,373.69
Other notes
66. Other Comprehensive Income
Refer to Note VII-48 for details.
67. Cash Flow Statement
(1) Cash Generated from Other Operating Activities
Unit: RMB
Item Reporting Period Same Period of last year
Large intercourse funds 0.00 3,000,000.00
Interest income 50,333,967.32 25,827,011.83
Net margins, security deposit and various
3,846,601.06 2,838,483.50
special funds received
Other small receivables 0.00 6,991,846.30
Total 54,180,568.38 38,657,341.63
184
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Notes:
None
(2) Cash Used in Other Operating Activities
Unit: RMB
Item Reporting Period Same Period of last year
Paying administrative expense in cash 29,464,167.94 38,821,683.72
Paying selling expense in cash 44,006,125.48 24,407,136.09
Net amount of utilities, miscellaneous
fees and accident fee and other payments 19,149,484.39 20,314,557.26
on behalf
Other small payments 6,611,337.86
Total 92,619,777.81 90,154,714.93
Notes:
None
(3) Cash Generated from Other Investing Activities
Unit: RMB
Item Reporting Period Same Period of last year
Notes:
Not applicable
(4) Cash Used in Other Investing Activities
Unit: RMB
Item Reporting Period Same Period of last year
Notes:
Not applicable
(5) Cash Generated from Other Financing Activities
Unit: RMB
Item Reporting Period Same Period of last year
Notes:
Not applicable
(6) Cash Used in Other Financing Activities
Unit: RMB
185
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Item Reporting Period Same Period of last year
Notes:
Not applicable
68. Supplemental Information for Cash Flow Statement
(1) Supplemental Information for Cash Flow Statement
Unit: RMB
Supplemental information Reporting Period Same period of last year
1. Reconciliation of net profit to net cash
-- --
flows generated from operating activities
Net profit 592,661,752.02 622,962,734.37
Add: Provision for impairment of assets -6,926,131.97 -56,696,940.86
Depreciation of fixed assets, oil-gas assets,
27,721,578.69 38,598,604.19
and productive living assets
Amortization of intangible assets 6,556,461.12
Amortization of long-term prepaid expenses 635,167.63 498,718.07
Losses from disposal of fixed assets,
intangible assets and other long-lived assets 8,096.97 11,772.11
(gains: negative)
Losses on scrap of fixed assets (gains:
71,392.61
negative)
Finance costs (gains: negative) -5,212.00 36,939.72
Investment loss (gains: negative) -1,889,021.11 -106,874,030.32
Decrease in deferred income tax assets
-131,761,434.00 -10,038,547.95
(gains: negative)
Increase in deferred income tax liabilities
-3,392.55 -5,819.36
(―-‖ means decrease)
Decrease in inventory (gains: negative) 677,488,978.60 770,702,729.75
Decrease in accounts receivable generated
-43,238,766.69 68,508,132.92
from operating activities (gains: negative)
Increase in accounts payable used in
8,836,623.81 -1,680,530,514.70
operating activities (decrease: negative)
Other
Net cash generated from/used in operating
1,123,594,927.59 -346,269,760.94
activities
2. Significant investing and financing -- --
186
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
activities without involvement of cash
receipts and payments
3. Net increase/decrease of cash and cash
-- --
equivalent:
Ending balance of cash 3,375,714,690.09 2,464,626,655.21
Less: beginning balance of cash 2,464,626,655.21 2,857,353,056.85
Add: ending balance of cash equivalents
Less: beginning balance of cash equivalents
Net increase in cash and cash equivalents 911,088,034.88 -392,726,401.64
(2) Net Cash Paid For Acquisition of Subsidiaries
Unit: RMB
Amount
Of which: --
Of which: --
Of which: --
Other notes：
None
(3) Net Cash Receive from Disposal of the Subsidiaries
Unit: RMB
Amount
Cash or cash equivalents received in the Reporting Period from
79,901,686.57
disposal of subsidiaries in the Current Period
Of which: --
Of which: Shenzhen International Trade Center Car Industry Co.,
68,998,374.55
Ltd.
Shenzhen Shenxin Taxi Co., Ltd. 10,903,312.02
Of which: --
Of which: --
Net cash received from disposal of subsidiaries 79,901,686.57
Other notes：
None
187
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(4) Cash and Cash Equivalents
Unit: RMB
Item Ending balance Beginning balance
I. Cash 3,375,714,690.09 2,464,626,655.21
Including: Cash on hand 176,193.08 164,502.21
Bank deposit on demand 3,375,538,497.01 2,463,348,038.01
Other monetary fund on demand 1,114,114.99
III. Ending balance of cash and cash
3,375,714,690.09 2,464,626,655.21
equivalents
Other notes：
None
69. Notes to Items of the Statements of Changes in Owners’ Equity
Notes to the name of ―Other‖ of ending balance of the same period of last year adjusted and the amount adjusted:
Not applicable
70. Assets with Restricted Ownership or Right to Use
Unit: RMB
Item Ending carrying value Reason for restriction
Monetary capital 13,519,667.63 Refer to Note XIV.-2-(2)
Total 13,519,667.63 --
Other notes：
71. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
Unit: RMB
Ending foreign currency Ending balance converted to
Item Exchange rate
balance RMB
Monetary capital -- --
Of which: USD
EUR
HKD 61,076,208.86 0.8762 53,514,974.20
Accounts receivable -- --
188
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Of which: USD
EUR
HKD
Long-term borrowings -- --
Of which: USD
EUR
HKD
Other receivables
Of which: HKD 770.00 0.8762 674.67
Available-for-sale financial assets
Of which: USD 91,707.93 6.8632 629,409.87
Accounts payable
Of which: HKD 56,000.00 0.8762 49,067.20
Other payables
Of which: HKD 578,289.25 0.8762 506,697.04
Long-term payables
Of which: USD 8,768.06 6.8632 60,176.95
HKD 422,631.32 0.8762 312,455.77
Other notes：
(2) Notes to Overseas Entities Including: for Significant Oversea Entities, Main Operating Place, Recording
Currency and Selection Basis Shall Be Disclosed; if there Are Changes in Recording Currency, Relevant
Reasons Shall Be Disclosed.
√ Applicable □ Not applicable
Item Main Recording Basis for choosing
operating currency
place
Shum Yip Properties Development Co., Hong HKD Located in HK, settled by HKD
Ltd. and its subsidiary Kong
72. Arbitrage
Qualitative and quantitative information of relevant arbitrage instruments, hedged risk in line with the type of arbitrage to disclose:
Not applicable
189
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
73. Government Subsidy
(1) Basic Information on Government Subsidy
Unit: RMB
Amount recorded in the current
Category Amount Listed items
profit or loss
Subsidy for stabilizing posts 165,676.08 Non-operating income 165,676.08
(2) Return of Government Subsidy
□ Applicable √ Not applicable
Other notes:
74. Other
Not applicable
VIII. Changes of Consolidation Scope
1. Business Combination Not under the Same Control
(1) Business Combination Not under the Same Control during the Reporting Period
Unit: RMB
Income of Net profits of
Time and
Cost of Recognition acquiree from acquiree from
Name of place of Proportion of Way to gain
gaining the Purchase date basis of the purchase the purchase
acquiree gaining the equity the equity
equity purchase date date to date to
equity
period-end period-end
Other notes：
Not applicable
(2) Combination Cost and Goodwill
Unit: RMB
Combination cost
Note to determination method of the fair value of the combination cost, consideration and changes:
Not applicable
The main formation reason for the large goodwill:
Not applicable
Other notes：
190
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Not applicable
(3) The Identifiable Assets and Liabilities of Acquiree on Purchase Date
Unit: RMB
Fair value on purchase date Carrying value on purchase date
The determination method of the fair value of identifiable assets and liabilities
Not applicable
Contingent liability of acquiree undertaken in the business combination
Not applicable
Other notes：
Not applicable
(4) Gains or losses from Re-measurement of Equity Held before the Purchase Date at Fair Value
Whether there is a transaction that through multiple transaction step by step to realize business combination and gaining the control
during the Reporting Period
□ Yes √ No
(5) Notes to Reasonable Consideration or Fair Value of Identifiable Assets and Liabilities of the Acquiree
that Cannot Be Determined on the Acquisition Date or during the Period-end of the Merger
Not applicable
(6) Other Notes
Changes in consolidation scope for other reasons
On 1 November 2018, Shenzhen International Trade Center Property Management Co., Ltd., the Company‘s subsidiary, and Slender
West Lake Tourism Business Management Group jointly established Yangzhou Slender West Lake Jingyue Property Management
Co., Ltd. with a registered capital of RMB10,000,000.00, among which, RMB5,100,000.00 was offered by Shenzhen International
Trade Center Property Management Co., Ltd. for shareholding ratio of 51.00%.
On 5 September 2018, Shandong International Trade Center Property Management Co., Ltd., the subsidiary of the Company, set up a
wholly-owned subsidiary Shandong International Trade Center Hotel Management Co., Ltd. with a registered capital of
RMB300,000.00.
2. Business Combination under the Same Control
(1) Business Combination under the Same Control during the Reporting Period
Unit: RMB
Combined Proportion of Combination Recognition Income from Net profits Income of the Net profits of
Basis
party the equity date basis of the from the acquiree the acquiree
191
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
combination period-begin period-begin during the during the
date ning to the ning to the period of period of
combination combination comparison comparison
date of the date of the
acquiree acquiree
Other notes：
(2) Combination Cost
Unit: RMB
Combination cost
Note to contingent consideration and the changes:
Other notes：
(3) The Carrying Value of Assets and Liabilities of the Combined Party on the Combination Date
Unit: RMB
Combination date Period-end of the last period
Contingent liabilities of the combined party undertaken in the business combination
Other notes：
3. Counter Purchase
Basic information of trading, the basis of transactions constitute counter purchase, the retain assets , liabilities of the listed companies
whether constituted a business and its basis, the determination of the combination costs, the amount and calculation of adjusted rights
and interests in accordance with the equity transaction process:
4. Disposal of Subsidiary
Whether there is a single disposal of the investment to the subsidiary and lost control?
□ Yes √ No
Whether there are several disposals of the investment to the subsidiary and lost controls?
□ Yes √ No
5. Changes in Combination Scope for Other Reasons
Note to changes in combination scope for other reasons (such as newly establishment or liquidation of subsidiaries, etc.) and relevant
information:
192
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
6. Other
IX. Equity in Other Entities
1. Equity in Subsidiary
(1) Subsidiaries
Main operating Nature of Holding percentage (%)
Name Registration place Way of gaining
place business Directly Indirectly
Shenzhen
Property
Huangcheng Real Shenzhen Shenzhen 100.00% Set-up
development
Estate Co., Ltd.
Szprd Real Estate
Property
Development Co., Shenzhen Shenzhen 95.00% 5.00% Set-up
development
Ltd.
Prd Group
Xuzhou Dapeng
Property
Real Estate Xuzhou Xuzhou 100.00% Set-up
development
Development Co.,
Ltd.
Dongguan
International
Trade Center
Property
Changsheng Real Dongguan Dongguan 100.00% Set-up
development
Estate
Development Co.,
Ltd.
Prd Yangzhou
Real Estate Property
Yangzhou Yangzhou 100.00% Set-up
Development Co., development
Ltd.
Shenzhen
International
Trade Center Property
Shenzhen Shenzhen 100.00% Set-up
Property management
Management Co.,
Ltd.
Shenzhen
Huangcheng Real Property
Shenzhen Shenzhen 100.00% Set-up
Estate management
Management Co.,
193
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ltd.
Shandong
Shenzhen
International
Property
Trade Center Jinan Jinan 100.00% Set-up
management
Property
Management Co.,
Ltd.
Chongqing
Shenzhen
International
Property
Trade Center Chongqing Chongqing 100.00% Set-up
management
Property
Management Co.,
Ltd.
Chongqing
Ao‘Bo Elevator Chongqing Chongqing Service 100.00% Set-up
Co., Ltd.
Shenzhen
Tianque Elevator
Shenzhen Shenzhen Service 100.00% Set-up
Technology Co.,
Ltd.
Shenzhen
International
Trade Center
Property
Shenzhen Shenzhen Service 100.00% Set-up
Management
Engineering
Equipment Co.,
Ltd.
Shenzhen
International
Shenzhen Shenzhen Catering service 100.00% Set-up
Trade Center
Food Co., Ltd.
Shenzhen
Property
Project
Construction Shenzhen Shenzhen 100.00% Set-up
supervision
Supervision Co.,
Ltd.
Shenzhen
International Shenzhen Shenzhen Service industry 100.00% Set-up
Trade Real Estate
194
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Exchange Center
Zhanjiang
Shenzhen Real
Property
Estate Zhanjiang Zhanjiang 100.00% Set-up
development
Development Co.,
Ltd.
Shum Yip
Properties Property
Hong Kong Hong Kong 100.00% Set-up
Development Co., development
Ltd.
Wayhang
Property
Development Co., Hong Kong Hong Kong 100.00% Set-up
development
Ltd.
Chief Link
Property
Properties Co., Hong Kong Hong Kong 70.00% Set-up
development
Ltd.
Business
Syndis
Property combination not
Investment Co., Hong Kong Hong Kong 70.00%
development under the same
Ltd.
control
Yangzhou
Slender West
Lake Jingyue Property
Yangzhou Yangzhou 51.00% Set-up
Property development
Development Co.,
Ltd.
Shangdong
International
Trade Center
Jinan Jinan Service industry 100.00% Set-up
Hotel
Management Co.,
Ltd.
Notes: holding proportion in subsidiary different from voting proportion:
Not applicable
Basis of holding half or less voting rights but still controlling the investee and holding more than half of the voting rights but not
controlling the investee:
Not applicable
Significant structural entities and controlling basis in the scope of combination:
Not applicable
Basis of determining whether the Company is the agent or the principal:
Not applicable
195
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Other notes：
None
(2) Significant Non-wholly-owned Subsidiary
Unit: RMB
Shareholding proportion The profit or loss Declaring dividends Balance of
Name of non-controlling attributable to the distributed to non-controlling interests
interests non-controlling interests non-controlling interests at the period-end
Yangzhou Slender West
Lake Jingyue Property 49.00% -62,100.69 2,387,899.31
Development Co., Ltd.
Holding proportion of non-controlling interests in subsidiary different from voting proportion:
Other notes：
(3) The Main Financial Information of Significant Not Wholly-owned Subsidiary
Unit: RMB
Ending balance Beginning balance
Non-curr Non-curr Non-curr Non-curr
Name Current Total Current Total Current Total Current Total
ent ent ent ent
assets assets liabilities liabilities assets assets liabilities liabilities
assets liability assets liability
Yangzho
u
Slender
West
Lake 4,873,26 4,873,26
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Jingyue 3.90 3.90
Property
Develop
ment
Co., Ltd.
Unit: RMB
Reporting Period Same period of last year
Cash flows Cash flows
Total Total
Name Operating from Operating from
Net profit comprehensi Net profit comprehensi
revenue operating revenue operating
ve income ve income
activities activities
Yangzhou
Slender West 0.00 -126,736.10 -126,736.10 -126,736.10 0.00 0.00 0.00 0.00
Lake Jingyue
196
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Property
Development
Co., Ltd.
Other notes：
(4) Significant Restrictions on Using the Assets and Liquidating the Liabilities of the Company
None
(5) Financial Support or Other Supports Provided to Structural Entities Incorporated into the Scope of
Consolidated Financial Statements
None
Other notes：
2. The Transaction of the Company with Its Owner’s Equity Share Changed but Still Controlling the
Subsidiary
(1) Note to the Owner’s Equity Share Changed in Subsidiary
None
(2) The Transaction’s Influence on the Equity of Non-controlling Interests and the Owner's Equity
Attributable to the Company as the Parent
Unit: RMB
Other notes
Not applicable
3. Equity in Joint Ventures or Associated Enterprises
(1) Significant Joint Ventures or Associated Enterprises
Holding percentage (%) Accounting
treatment of the
Main operating Nature of investment to
Name Registration place
place business Directly Indirectly joint venture or
associated
enterprise
Shenzhen Jifa
Warehouse Co., Shenzhen Shenzhen Warehouse serve 50.00% Equity method
Ltd.
197
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Tianan
International
Building Property Property
Shenzhen Shenzhen 50.00% Equity method
Management management
Company of
Shenzhen
Notes to holding proportion of joint venture or associated enterprise different from voting proportion:
Not applicable
Basis of holding less than 20% of the voting rights but has a significant impact or holding 20% or more voting rights but does not
have a significant impact:
Not applicable
(2) Main Financial Information of Significant Joint Ventures
Unit: RMB
Ending balance/Reporting Period Beginning balance/The same period of last year
Tianan International Tianan International
Shenzhen Jifa Warehouse Building Property Shenzhen Jifa Warehouse Building Property
Co., Ltd. Management Company Co., Ltd. Management Company
of Shenzhen of Shenzhen
Current assets 9,555,202.09 50,941,418.43 6,879,862.65 47,958,558.83
Of Which: Cash and cash
8,614,698.79 34,496,954.60 5,890,362.65 34,268,115.61
equivalents
Non-current assets 62,828,540.59 38,523.34 63,528,043.92 29,349.24
Total assets 72,383,742.68 50,979,941.77 70,407,906.57 47,987,908.07
Current liabilities 4,176,061.89 22,970,163.57 3,410,681.06 21,253,083.10
Non-current liability 16,218,892.53 16,271,264.57
Total liabilities 4,176,061.89 39,189,056.10 3,410,681.06 37,524,347.67
Equity attributable To
owners of the Company 68,207,680.79 11,790,885.67 66,997,225.51 10,463,560.40
as the parent
Portion of net Assets
calculated according to
34,103,840.40 5,895,442.84 33,498,612.76 5,231,780.20
proportion of
shareholdings
Carrying value of equity
investment to joint 34,103,840.40 5,895,442.84 33,498,612.76 5,231,780.20
ventures
Operating revenue 5,269,653.82 20,490,161.85 7,504,631.18 17,581,422.94
198
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Finance expense -19,322.34 -221,967.51 -12,400.09 -724,727.16
Income tax expense 403,485.10 444,662.96 836,613.87 495,714.73
Net profit 1,210,455.28 1,327,325.27 2,470,744.33 1,486,259.40
Other comprehensive
1,210,455.28 1,327,325.27 2,470,744.33 1,486,259.40
income
Total comprehensive
1,210,455.28 1,327,325.27 2,470,744.33 1,486,259.40
income
Other notes
None
(3) Main Financial Information of Significant Associated Enterprise
Unit: RMB
Beginning balance/The same period of last
Ending balance/Reporting Period
year
Other notes
Not applicable
(4) Summary Financial Information of Insignificant Joint Ventures or Associated Enterprises
Unit: RMB
Beginning balance/The same period of last
Ending balance/Reporting Period
year
Joint venture: -- --
The total of following items according to the
-- --
shareholding proportions
Associated enterprise: -- --
The total of following items according to the
-- --
shareholding proportions
Other notes
Note: The Company has withdrawn depreciation reserves in full for its associated enterprise Shenzhen Wufang Pottery & Porcelain
Industrial Co., Ltd. and now has no ability to obtain its financial statements. Therefore, the Company regarded it as insignificant
associated enterprise.
(5) Note to the Significant Restrictions on the Ability of Joint Ventures or Associated Enterprises to
Transfer Funds to the Company
None
199
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(6) The Excess Loss of Joint Ventures or Associated Enterprises
Unit: RMB
The cumulative recognized The derecognized losses (or the
The accumulative unrecognized
Name losses in previous share of net profit) in Reporting
losses in Reporting Period
accumulatively derecognized Period
Other notes
Not applicable
(7) The Unrecognized Commitment Related to Investment to Joint Ventures
None
(8) Contingent Liabilities Related to Investment to Joint Ventures or Associated Enterprises
None
4. Significant Common Operation
Proportion /share portion
Name Main operating place Registration place Nature of business
Directly Indirectly
Notes to holding proportion or share portion in common operation different from voting proportion:
None
For common operation as a single entity, basis of classifying as common operation
None
Other notes
None
5. Equity in the Structured Entity Excluded in the Scope of Consolidated Financial Statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
None
6. Other
None
X. The Risk Related to Financial Instruments
The financial instruments of the Group include: monetary fund, the available for sale financial assets, borrowings, accounts
receivable and accounts payable, etc, for details, see disclosure in each note.
1. Market Risk
(1) Exchange rate risk
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Exchange rate risk refers to risk of losses due to fluctuation in exchange rate. Sensitive analysis of foreign exchange risk was as
follows, which reflected the influence of changes in monetary assets and monetary liabilities on net profits and shareholders‘ equity
when the following listed foreign exchanges showed reasonable and possible changes under the hypothesis of other variables
constant.
Item Period-end Period-begin
Change in net profit Change in equity of Change in net profit Change in equity of
shareholders shareholders
RMB down 2% against HKD 789,711.43 1,864,214.88 -28.41 -1,017,872.15
RMB up 2% against HKD -789,711.43 -1,864,214.88 28.41 1,017,872.15
RMB down 2% against USD 8,538.49 8,538.49 -8,988.57 -8,988.57
RMB up 2% against USD -8,538.49 -8,538.49 8,988.57 8,988.57
2. Credit Risk
The credit risk mainly occurred in bank deposit, accounts receivable and other receivables. The source of credit risk of financial
assets was the default of the other party. The biggest risk exposure was equivalent to book value of the instruments.
The Group‘s working capital was in bank with higher credit rating, so there was no significant credit risk, nor significant losses due
to the default of other entity. Thus, the credit risk of working capital is relatively low.
There were accounts receivable withdrawn individually in the Group and had withdrawn bad debt provision, which fully reveal the
existence of credit risk. Amount of balance of account receivables was RMB67,992,690.84 except the aforesaid had withdrawn bad
debt provision, mainly was the account receivable of property management, of which was account receivable RMB21,389,086.53 of
Taobao (China) Software Co., Ltd. was the total property management costs of several serve district of Taobao (China) Software Co.,
Ltd. Other client receivables were widely dispersed owners and tenants. The Group conducted continuous supervisor to the account
receivables to ensure the Group not facing significant bad debt risk.
3. Liquidity Risk
The subsidiary of the Group monitor the cash flow and the need of itself, the headquarters of the finance department combine the
cash flow of each subsidiary, continue to monitor the short term or long term capital needs to ensure maintain plenty of cash flow.
Besides, according to the actual capital need of the Group, provided commitment of adequate emergency capital to meet the short
term and long term capital need.
XI. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Unit: RMB
Ending fair value
Item Fair value measurement Fair value measurement Fair value measurement
Total
items at level 1 items at level 2 items at level 3
I. Consistent fair value
-- -- -- --
measurement
(II)Available-for-sale
3,621,381.11 3,621,381.11
financial assets
(2) equity instrument 3,621,381.11 3,621,381.11
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
investment
The total amount of assets
3,621,381.11 3,621,381.11
measured at fair value
II. Inconsistent fair value
-- -- -- --
measurement
2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at Level
1
The closing price in the national stock transfer system for small and medium sized enterprises on 30 December 2018
3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 2
Not applicable
4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 3
Not applicable
5. Sensitiveness Analysis on Unobservable Parameters and Adjustment Information between Beginning and
Ending Carrying Value of Consistent Fair Value Measurement Items at Level 3
Not applicable
6. Explain the Reason for Conversion and the Governing Policy when the Conversion Happens if
Conversion Happens among Consistent Fair Value Measurement Items at Different Levels
Not applicable
7. Changes in the Valuation Technique in the Current Period and the Reason for Such Changes
Not applicable
8. Fair Value of Financial Assets and Liabilities Not Measured at Fair Value
Not applicable
9. Other
Not applicable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
XII. Related Party and Related-party Transactions
1. Information Related to the Company as the Parent of the Company
Proportion of share Proportion of voting
held by the rights owned by the
Name Registration place Nature of business Registered capital Company as the Company as the
parent against the parent against the
Company (%) Company (%)
Shenzhen
Managing
Investment Holdings Shenzhen RMB25,349,000,000 63.82% 63.82%
state-owned assets
Co., Ltd
Notes: information on the Company as the parent
Note: Shenzhen Investment Holdings Co., Ltd. is the final controller of the Company and also is a sole state-funded limited company.
As a government department, Shenzhen State-owned Assets Supervision and Administration Bureau manage Shenzhen Investment
Holdings Co., Ltd. on behalf of People‘s Government of Shenzhen Municipality. Thus, the final controller of the Company is
Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen Government.
The registered capital of Shenzhen Investment Holdings Co., Ltd. was changed into RMB25,349,000,000 on 4 December 2018. The
original registered capital was RMB RMB23,149 million.
The final controller of the Company is Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen
Government.
Other notes：
None
2. Subsidiaries of the Company
Refer to Note IX-1. Equity in Subsidiary for details.
3. Information on the Joint Ventures and Associated Enterprises of the Company
Refer to Note IX-3. Equity in Joint Ventures or Associated Enterprises for details about significant joint ventures or associated
enterprises.
Information on other joint venture or associated enterprise of occurring related-party transactions with the Company in Reporting
Period, or forming balance due to related-party transactions made in previous period:
Name Relationship with the Company
Other notes
Not applicable
4. Information on Other Related Parties
Name Relationship with the Company
203
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Under the same control of the Company as the parent of the
Shenzhen Investment Holdings Co., Ltd.
Company
Other notes
None
5. List of Connected Transactions
(1) Information on Acquisition of Goods and Reception of Labor Service
Information on acquisition of goods and reception of labor service
Unit: RMB
The approval trade Whether exceed trade Same period of last
Related party Content Reporting Period
credit credit or not year
0.00
Information of sales of goods and provision of labor service
Unit: RMB
Related party Content Reporting Period Same period of last year
Shenzhen Investment Holdings
Property management 943,396.23 0.00
Co., Ltd.
Notes:
(2) Information on Related-party Trusteeship/Contract
Lists of trusteeship/contract:
Unit: RMB
Name of the Name of the Income
entruster/contract entrustee/ Type Start date Due date Pricing basis recognized in this
ee contractor Reporting Period
Notes:
Not applicable
Lists of entrust/contractee
Unit: RMB
Name of the Name of the Charge
entruster/contract entrustee/ Type Start date Due date Pricing basis recognized in this
ee contractor Reporting Period
Notes:
Not applicable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(3) Information on Related-party Lease
The Company was lessor:
Unit: RMB
The lease income confirmed in The lease income confirmed in
Name of lessee Category of leased assets
the Reporting Period the same period of last year
The Company was lessee:
Unit: RMB
The lease fee confirmed in the The lease fee confirmed in the
Name of lessor Category of leased assets
Reporting Period same period of last year
Shenzhen Investment Holdings
Office 365,868.00 358,700.40
Co., Ltd.
Notes:
(4) Information on Related-party Guarantee
The Company was guarantor:
Unit: RMB
Execution accomplished
Secured party Guarantee amount Start date End date
or not
The Company was secured party
Unit: RMB
Execution accomplished
Guarantor: Guarantee amount Start date End date
or not
Notes:
Not applicable
(5) Information on Inter-bank Lending of Capital of Related Parties
Unit: RMB
Related party Amount Start date End date Note
Borrowing
Lending
(6) Information on Assets Transfer and Debt Restructuring by Related Party
Unit: RMB
Related party Content Reporting period Same period of last year
205
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(7) Information on Remuneration for Key Management Personnel
Unit: RMB
Item Reporting period Same period of last year
Remuneration for key management
9,764,725.59 6,426,500.00
personnel
(8) Other Related-party Transactions
Not applicable
6. Accounts Receivable and Payable of Related Party
(1) Accounts Receivable
Unit: RMB
Ending balance Beginning balance
Item Related party
Carrying amount Bad debt provision Carrying amount Bad debt provision
Shenzhen Wufang
Other receivables Pottery & Porcelain 1,747,264.25 1,747,264.25 1,747,264.25 1,747,264.25
Industrial Co., Ltd.
(2) Accounts Payable
Unit: RMB
Item Related party Ending carrying amount Beginning carrying amount
Shenzhen Jifa Warehouse Co.,
Other payables 29,296,665.14 29,296,665.14
Ltd.
Tianan International Building
Other payables Property Management 5,214,345.90 5,214,345.90
Company of Shenzhen
7. Commitments of Related Party
None
8. Other
Not applicable
206
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
XIII. Stock Payment
1. The Overall Situation of Stock Payment
□ Applicable □ Not applicable
2. The Stock Payment Settled in Equity
□ Applicable □ Not applicable
3. The Stock Payment Settled in Cash
□ Applicable □ Not applicable
4. Modification and Termination of the Stock Payment
None
5. Other
None
XIV. Commitments and Contingency
1. Significant Commitments
Significant Contingency on Balance Sheet Date
2. Contingency
(1) Significant Contingency on Balance Sheet Date
(1)Pending Action
The action about transferring Jiabin Building contentious matter ( Now rename as: Longyuan Development Building; former name
Jinlihua Commercial Plaza）
In 1993, the Company signed Right of Development Transfer Contract of Jiabin Building with Shenzhen Jiyong Property
Development Co., Ltd. (hereinafter referred to as ―Jiyong Company‖). Since the contract was not effectively executed, the Company
subsequently filed a series of lawsuits against the parties involved in the project, but the outcome was not favorable to the Company.
Therefore, the Company calculated and withdrew bad-debt provisions for accounts receivable from Jiyong Company in full in past
years for the transfer of Jiabin Building (see 2. (4) of Note VII for details). On October 31, 2018, Shenzhen Intermediate People‘s
Court made a civil award and ruled that the Company‘s application for the bankruptcy of Jiyong Company would not be accepted.
The Company refused to accept such ruling and has appealed to Shenzhen Intermediate People‘s Court.
(2) Guarantee
①:The Company’s subsidiary Dongguan International Trade Center Changsheng Real Estate Development Co., Ltd. belongs to
provisional qualification real estate development enterprise, when dealing with the application of approval of the presale of houses,
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
the commercial housing quality guarantee after the liquidations of enterprise bankruptcy, dissolution, Dongguan International Trade
Center Changsheng Real Estate Development Co., Ltd. submitted guarantee RMB12,402,160.00 to Bank of Communications,
Duangguang, Dalang Branch, the bank issue 9 Guarantee Letter for irrevocable goods, of which one guarantee of RMB1,468,870.00,
from 30 June 2015 to 31 December 2020, and the remained were RMB10,933,290.00 from 1 July 2015 to 31 December 2020. As of
31 December 2018, the Company has get the original L/G back from Land and Resources Bureau.
②: As a real estate developer, the Company has provided mortgage guarantees for commercial housing purchasers and paid loan
guarantees according to real estate business practices. As of 31 December 2018, the balance of the cash deposit that have not been
released is RMB1,117,507.63. That guarantee will be released on the date when the mortgage money is paid off.
③: The Company and its subsidiaries provide mortgage guarantees for commercial housing purchasers according to the real estate
business practice. The purchaser uses the purchased commercial housing as collateral. The guarantee amount that has not been settled
as of 31 December 2018 totals RMB735,697,969.36. and since so far, purchasers have not defaulted, and the current market price of
these properties is higher than the selling price, the Company believes that the risks associated with providing such guarantees are
relatively low.
④: On 20 April 2018, Shenzhen Huangcheng Real Estate Co., Ltd. (hereinafter referred to as ―Huangcheng Real Estate‖), a
subsidiary of the Company, signed a fixed asset borrowing contract with the Shenzhen Branch of Bank of Shanghai Co., Ltd., in
which, the land use right of Golden Collar‘s Resort was mortgaged and the Company agreed to provide guarantee for Huangcheng
Real Estate. In November 2018, due to the pre-sale of Golden Collar’s Resort Project, mortgage of the land use right was released
according to the requirements of the Housing Authority. Only the credit guarantee provided by the Company for Huangcheng Real
Estate was still effective. As of the end of the period, the details about the remaining outstanding guarantee are as follows:
Secured party Content Guarantee period Amount
Shenzhen Huangcheng Real Estate Co., Shenzhen Branch of Bank 20 June 2018 to 20 June 2021 1,000,000.00
Ltd. of Shanghai
Total 1,000,000.00
(2) In Despite of no Significant Contingency to Disclose, the Company Shall Also Make Relevant
Statements
There was no significant contingency in the Company to disclose.
3. Other
Acquisition event after the Reporting Period
On 26 February 2019, the Company signed the share transfer agreement with Shenzhen Xinhai Rongyao Real Estate Development
Co., Ltd. (hereinafter referred to as ―Xinhai Rongyao‖) to acquire 69% of shares in its subsidiary Shenzhen Rongyao Real Estate
Development Co., Ltd. (hereinafter referred to as the ―target company‖). The price for transfer of shares in the target company agreed
bilaterally is RMB508 million which will be paid in four installments based on the progress of the project stipulated in the agreement.
After the completion of share transfer, the Company will develop the project of urban renewal unit in Bangling region owned by the
target company together with Xinhai Rongyao. As of the period-end, the Company has paid a subscription of RMB0.1 billion which
will be offset the share transfer money payable when meeting the clauses of the first payment as stipulated in the share transfer
agreement. The plan for payment of share transfer was as follows:
Payment clause Payment amount
Completing the setting up of fund supervision account and all application documents 101,600,000.00
required in the registration changing procedures have been prepared completely
208
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Completion of demolition of Bangling Phase I 152,400,000.00
Completion of demolition of Bangling Phase II 203,200,000.00
Recognization of implementation subject of Bangling Phase I and Bangling Phase II 50,800,000.00
Total 508,000,000.00
XV. Events after Balance Sheet Date
1. Significant Non-adjusted Events
Unit: RMB
Influence number to the
Reason of inability to estimate
Item Content financial position and operating
influence number
results
2. Profit Distribution
Unit: RMB
Profits or dividends to be distributed 178,793,727.60
Profits or dividends announced to be distributed after the approval 178,793,727.60
3. Sales Return
None
4. Notes to Other Events after Balance Sheet Date
Influence of the Implementation of New ASBE from January 1, 2019
On 31 March 2017, the Ministry of Finance respectively issued ASBE No. 22-Recognition and Measurement of Financial
Instruments (Revised in 2017) (CK [2017] No. 7), ASBE No. 23-Transfer of Financial Assets (Revised in 2017) (CK [2017] No. 8),
and ASBE No. 24-Hedge Accounting (Revised in 2017) (CK [2017] No. 9). On 2 May 2017, ASBE No. 37-Presentation of financial
instruments (Revised in 2017) (CK [2017] No. 14) was issued (all the above-mentioned standards are collectively referred to as
―New Financial Instruments Standards‖), and domestic listed companies were required to implement these new standards from 1
January 2019 on. The Company will implement the above new financial instrument standards from 1 January 2019 on, and change
relevant accounting policies in accordance with the above new financial instrument standards.
Main changes in the accounting policy involved are described as follows:
According to new financial instrument standards, all recognized financial assets shall be subsequently measured based on the
amortized costs or the fair value.
On the implementation date of new financial instrument standards, the business model applied to manage the financial assets shall be
evaluated based on the facts and circumstances of the Company on the day, and the contractual cash flow characteristics on the
financial assets shall be evaluated based on the facts and circumstances resulting from the initial confirmation of the financial assets.
Financial assets are classified into three categories: Measured by the amortized cost, Measured by the fair value with changes
included in other comprehensive incomes and Measured by the fair value with changes included in profits or losses. For the equity
instrument investment measured by the fair value with changes included in other comprehensive incomes, when the financial asset is
209
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
derecognized, the accumulated gain or loss previously included in other comprehensive incomes shall be transferred from other
comprehensive incomes to the retained earnings without being included in the current gain or loss.
Pursuant to new financial instrument standards, the Company shall calculate and withdraw corresponding provisions for impairment
and recognize the credit impairment losses for financial assets measured by the amortized cost, debt instrument investments
measured by the fair value with changes included in other comprehensive incomes, lease receivables, contract assets and the financial
guarantee contract based on the expected credit loss.
XVI. Other Significant Events
1. The Accounting Errors Correction in Previous Period
(1) Retrospective Restatement
Unit: RMB
Name of the influenced report
Content Processing program accumulative impact
items during comparison period
(2) Prospective Application
Reason for adopting prospective
Content Processing program
application
2. Debt Restructuring
Not applicable
3. Assets Replacement
(1) Non-monetary Assets Exchange
Not applicable
(2) Other Assets Replacement
4. Pension Plan
Not applicable
5. Discontinued Operations
Unit: RMB
Profit from
Income tax
Item Income Expense Total profit Net profit discontinued
expense
operations
210
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
attributable to
owners of the
Company as the
parent
Other notes
Not applicable
6. Segment Information
(1) Determination Basis and Accounting Policies of Reportable Segment
The Group's business includes real estate business, property management, catering services, and other business (including:
mechanical and electrical professional maintenance business, automobile service, engineering supervision, parking lot, because of the
above businesses income are small, approve them being merged), etc. The Group separately organized and managed according to the
business and the properties of products and services provided. Each business division of the Group was a business group, provided
the facing risk and obtained rewards and products different from other division.
A. Real estate business divisions: real estate development, sales and rental
B. The property management business divisions: building management
C. Diet services: catering service
D. Other business: operating mechanical and electrical professional maintenance business, automobile service, engineering
supervision business, and parking lot
The management for the purpose of considering the decision of resources and evaluation of performance separately managed the
operating results of each unit of business.
(2) The Financial Information of Reportable Segment
Unit: RMB
Property Offset among
Item Real estate Catering service Others Total
management segment
Operation
2,285,948,875.48 468,624,110.77 32,010,217.83 16,497,980.20 -15,840,551.75 2,787,240,632.53
revenue
Cost of sales 886,871,173.23 414,923,126.76 28,529,242.78 12,286,802.65 -27,420,353.58 1,315,189,991.84
Total profit 694,502,815.24 33,922,662.27 566,164.16 73,333.90 48,410,150.14 777,475,125.71
-2,143,268,150.6
Total assets 7,389,794,956.74 457,108,967.67 7,399,483.47 109,166,880.33 5,820,202,137.54
7
-1,904,318,518.3
Total liabilities 3,881,617,071.17 380,249,838.06 4,666,715.02 116,787,720.65 2,479,002,826.53
7
(3) If there Was no Reportable Segment, or the Total Amount of Assets and Liabilities of Each Reportable
Segment Could not Be Reported, Relevant Reasons Shall Be Clearly Stated
Not applicable
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
(4) Other notes
①Foreign Trade Income regarding businesses
Item Reporting Period Same period of last year
Real estate 2,282,760,505.89 2,340,233,648.93
Property management 462,035,401.49 476,385,397.77
Transportation -- 49,005,268.82
Catering service 29,404,981.03 30,898,120.01
Other 13,039,744.12 8,168,255.00
Total 2,787,240,632.53 2,904,690,690.53
②Foreign trade income regarding geography and total non-current assets
Countries or regions Total foreign trrade income Total non-current assets
Reporting Period Same period of last Reporting Period Same period of last
year year
Mainland of China 2,787,240,632.53 2,904,690,690.53 434,417,428.34 456,036,976.47
Hong Kong -- -- 1,144,430.25 1,110,851.76
Other regions -- -- -- --
7. Other Significant Transactions and Events with Influence on Investors’ Decision-making
Not applicable
8. Other
None
XVII. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Notes Receivable and Accounts Receivable
Unit: RMB
Item Ending balance Beginning balance
Accounts receivable 1,853,494.72 479,462.50
Total 1,853,494.72 479,462.50
(1) Notes Receivable
1) Notes Receivable Listed by Category
Unit: RMB
Item Ending balance Beginning balance
212
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
2) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
Item Amount
3) Notes Receivable Endorsed by the Company or Discounted and not due on the Balance Sheet Date at the Period-end
Unit: RMB
Non-derecognized amount at the
Item Derecognized Amount at the period-end
period-end
4) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the Contract or Agreement
Unit: RMB
Amount of the notes transferred to accounts receivable at the
Item
period-end
Other notes
Not applicable
(2) Accounts Receivable
1) Accounts Receivable Classified by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra
Carrying Carrying
Proportio wal Proportio Withdrawal
Amount Amount value Amount Amount value
n proportio n proportion
n
Accounts receivable
with significant
single amount for 96,647,8 96,647,8 96,647, 96,647,88
97.98% 100.00% 99.03% 100.00%
which bad debt 89.05 89.05 889.05 9.05
provision separately
accrued
Accounts receivable
withdrawal of bad
1,940,44 86,951.6 1,853,494 893,820 414,357.6
debt provision of by 1.97% 4.48% 0.92% 46.36% 479,462.50
6.37 5 .72 .19 9
credit risks
characteristics:
Accounts receivable
with insignificant 54,380.3 54,380.3 54,380.
0.05% 100.00% 0.05% 54,380.35 100.00%
single amount for 5 5 35
which bad debt
213
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
provision separately
accrued
98,642,7 96,789,2 1,853,494 97,596, 97,116,62
Total 100.00% 98.12% 100.00% 99.51% 479,462.50
15.77 21.05 .72 089.59 7.09
Accounts receivable with significant single amount for which bad debt provision separately accrued at the period-end:
√ Applicable □ Not applicable
Unit: RMB
Accounts receivable（by Ending balance
unit） Accounts receivable Bad debt provision Withdrawal proportion Withdrawal reason
Involved in lawsuit and
Shenzhen Jiyong
with no executable
Properties & Resources 93,811,328.05 93,811,328.05 100.00%
property, please refer to
Development Company
Note XIV-2-(1)
Shenzhen Tewei Industry Not recovered for a long
2,836,561.00 2,836,561.00 100.00%
Co., Ltd. time
Total 96,647,889.05 96,647,889.05 -- --
In the groups, accounts receivable adopted aging analysis method to withdraw bad debt provision:
√ Applicable □ Not applicable
Unit: RMB
Ending balance
Aging
Accounts receivable Bad debt provision Withdrawal proportion
Subitem within 1 year
Within 1 year 1,910,819.30 57,324.58 3.00%
Over 5 years 29,627.07 29,627.07 100.00%
Notes to the determination basis for the group:
For details, please refer to Part XI Financial Statement-V-11.
Among these groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Not applicable
Among these groups, accounts receivable adopting other methods to withdraw bad debt provision:
Not applicable
2) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or
collected part during the Reporting Period was of RMB327,406.04.
Significant amount of reversed or recovered bad debt provision:
Unit: RMB
Name of the entity Amount Method
Not applicable
3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
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ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Unit: RMB
Item Amount
Of which: significant actual verification of accounts receivable
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes to verification of accounts receivable:
Not applicable
4) Top5 of the Ending Balance of the Accounts Receivable Collected according to Arrears Party
Entity Relationship with Amount Period Proportion to
the Company total accounts
receivable
Shenzhen Jiyong Properties & Non-related party 93,811,328.05 Over 5 years 95.10
Resources Development
Company
Shenzhen Tewei Industry Co., Non-related party 2,836,561.00 Over 5 years 2.88
Ltd.
Shenzhen Rainbow Department Non-related party 1,046,117.49 1 to 5 years 1.06
Store Co., Ltd
PingAn Bank Co., Ltd. Non-related party 459,252.00 Within 1 year 0.47
Shenzhen Meigexiazi Catering Non-related party Within 1 year 0.19
Management Co., Ltd. 190,955.00
Total — 98,344,213.54 — 99.70
5) Derecogniziton of Accounts Receivable due to the Transfer of Financial Assets
Not applicable
6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Accounts Receivable
Not applicable
Other notes：
Not applicable
2. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable 8,229,503.58
Other receivables 1,298,486,323.35 1,128,977,669.02
215
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Total 1,306,715,826.93 1,128,977,669.02
(1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
Item Ending balance Beginning balance
Fix time deposit 8,229,503.58
Total 8,229,503.58
2) Significant Overdue Interest
Unit: RMB
Whether occurred
Entity Ending balance Overdue time Overdue reason impairment and its
judgment basis
Other notes：
Not applicable
(2) Dividends Receivable
1) Dividends Receivable
Unit: RMB
Item (or investees) Ending balance Beginning balance
2) Significant Dividends Receivable Aged over 1 Year
Unit: RMB
Whether occurred
Item (or investees) Ending balance Aging Reason impairment and its
judgment basis
Other notes：
Not applicable
(3) Other Receivables
1) Other Receivables Disclosed by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category
Withdra Carrying Carrying
Proportio Proportio Withdrawal
Amount Amount wal value Amount Amount value
n n proportion
proportio
216
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
n
Other receivables
with significant
single amount for 121,695, 21,844,7 99,850,58 123,873 28,557,10 95,316,884.
9.14% 17.95% 59.45% 23.05%
which bad debt 318.80 31.77 7.03 ,986.03 1.98 05
provision separately
accrued
Other receivables
withdrawn bad debt 1,044,6
1,207,50 8,872,83 1,198,635 11,008,80 1,033,660,7
provision according 90.68% 0.73% 69,585. 89.21% 1.05%
8,567.54 1.22 ,736.32 0.80 84.97
to credit risks 77
characteristics
Other receivables
with insignificant
single amount for 2,415,32 2,415,32 2,415,3 2,415,326
0.18% 100.00% 0.00 1.13% 100.00% 0.00
which bad debt 6.23 6.23 26.23 .23
provision separately
accrued
1,170,9
1,331,61 33,132,8 1,298,486 41,981,22 1,128,977,6
Total 100.00% 2.48% 58,898. 100.00% 3.59%
9,212.57 89.22 ,323.35 9.01 69.02
03
Other receivables with significant single amount for which bad debt provision separately accrued at the end of the period
√ Applicable □ Not applicable
Unit: RMB
Ending balance
Other receivables (unit)
Other receivables Bad debt provision Withdrawal proportion Withdrawal reason
Shum Yip Properties Uncollectible for a long
107,628,702.90 7,778,115.87 7.23%
Development Co., Ltd. period
Shanghai Yutong Real
estate development Co., 5,676,000.00 5,676,000.00 100.00% Judgments, irrecoverable
Ltd.
Everglow Development Uncollectible for a long
3,271,837.78 3,271,837.78 100.00%
Limited period
Dameisha Tourism Center 2,576,445.69 2,576,445.69 100.00% Suspension of projects
Elevated Train Project 2,542,332.43 2,542,332.43 100.00% Suspension of projects
Total 121,695,318.80 21,844,731.77 -- --
Among these groups, other receivables adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Not applicable
Unit: RMB
217
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ending balance
Aging
Other receivables Bad debt provision Withdrawal proportion
Subentry within 1 year
Within 1 year 138,811.00 4,164.33 3.00%
Subtotal of within 1 year 138,811.00 4,164.33 3.00%
1 to 2 years 601,020.08 60,102.01 10.00%
2 to 3 years 43,300.00 12,990.00 30.00%
4 to 5 years 42,200.00 33,760.00 80.00%
Over 5 years 8,761,814.88 8,761,814.88 100.00%
Total 9,587,145.96 8,872,831.22
Notes to the determination basis for the Group:
Refer to Part XI Financial Statement-V-11 in the Report for details.
Among these groups, other receivables adopting balance percentage method to withdraw bad debt provision
□ Applicable √ Not applicable
Among these groups, other receivables adopting other methods to withdraw bad debt provision:
□ Applicable √ Not applicable
2) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or
collected part during the Reporting Period was of RMB2,294,834.48.
Significant amount of reversed or recovered bad debt provision:
Unit: RMB
Name of the entity Reversed or collected amount Method
The bad debt provision recovered in the Reporting Period was RMB2,294,834.48; the increase in bad debt provision generated from
exchange rate translation of bad debt provision for claimable assets in foreign currency receivable during the Reporting Period was
RMB426,767.70. Since the court ruled that the Shenzhen Shengfeng Road Guomao Jewel & Gold Co., Ltd. ended its bankruptcy
procedures, the bad debt provision of RMB6,980,273.01 was transferred into other current assets with the original value.
Other receivables transferred out during the Reporting Period
Name of the entity Nature of other Amount transferred out Transfer reason
receivbales Other receivables Bad debt provision
Shenzhen Shengfeng Road, Rental charge and 6,980,273.01 6,980,273.01 The company has break down and
Guomao Jewel & Gold utilities be transferred into asset group to
Co., Ltd. be verified
Total — 6,980,273.01 6,980,273.01 —
3) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
Item Amount
Of which, the verification of significant other receivables:
Unit: RMB
218
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes to the verification of other receivables:
Not applicable
4) Other Receivables Classified by Nature
Unit: RMB
Nature Ending carrying amount Beginning carrying amount
Margin 2,218,894.63 2,218,894.63
Pretty cash 174,311.00 86,342.50
Payment on behalf 511,835.47 511,835.47
Intercourse fund 130,739,271.12 102,707,509.45
Account receivable to subsidiary 1,197,974,900.35 1,065,434,315.98
Total 1,331,619,212.57 1,170,958,898.03
5) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to ending
Ending balance of
Name of the entity Nature Ending balance Aging balance of total other
bad debt provision
receivables%
SZPRD Xuzhou
Dapeng Real Estate Related party in
389,838,221.77 Within 1 year 29.28%
Development Co., combination scope
Ltd.
SZPRD Yangzhou
Real Estate Related party in
175,939,836.60 Within 1 year 13.21%
Development Co., combination scope
Ltd.
SHUM YIP
PROPERTIES Related party in
107,628,702.90 Over 5 years 8.08% 7,778,115.87
DEVELOPMENT combination scope
LIMITED
Shenzhen
Related party in
Huangcheng Property 76,265,906.77 Within 1 year 5.73%
combination scope
Management Co., Ltd.
Shanghai Yutong Real
Non-related party 5,676,000.00 Over 5 years 0.43% 5,676,000.00
Estate Co., Ltd.
Total -- 755,348,668.04 -- 13,454,115.87
6) Accounts Receivable Involving Government Subsidies
219
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Unit: RMB
Project of government Estimated recovering
Name of the entity Ending balance Ending aging
subsidies time, amount and basis
Not applicable
7) Derecogniziton of Other Receivables due to the Transfer of Financial Assets
Not applicable
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables
Not applicable
Other notes：
Not applicable
3. Long-term Equity Investment
Unit: RMB
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserve reserve
Investment to
269,466,672.93 69,964,000.00 199,502,672.93 231,846,672.93 19,964,000.00 211,882,672.93
subsidiaries
Investment to
joint ventures and
58,982,897.38 18,983,614.14 39,999,283.24 57,714,007.10 18,983,614.14 38,730,392.96
associated
enterprises
Total 328,449,570.31 88,947,614.14 239,501,956.17 289,560,680.03 38,947,614.14 250,613,065.89
(1) Investment to Subsidiaries
Unit: RMB
Depreciation Ending balance of
Beginning
Investee Increase Decrease Ending balance reserve depreciation
balance
withdrawn reserve
Shenzhen
Huangcheng Real 35,552,671.93 35,552,671.93
Estate Co., Ltd.
SZPRD Real
Estate
30,950,000.00 30,950,000.00
Development Co.,
Ltd.
SZPRD Yangzhou
Real Estate 50,000,000.00 50,000,000.00
Development Co.,
220
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Ltd.
Dongguan ITC
Changsheng Real
Estate 20,000,000.00 20,000,000.00
Development Co.,
Ltd.
Shenzhen
International Trade
Center Property 20,000,000.00 20,000,000.00
Management Co.,
Ltd.
Shenzhen
International Trade
1,600,001.00 1,600,001.00 1,600,000.00
Center Catering
Co., Ltd.
Shenzhen Property
Construction
3,000,000.00 3,000,000.00
Supervision Co.,
Ltd.
SZPRD Housing
Assets Operation
2,380,000.00 37,620,000.00 40,000,000.00
and Management
Co., Ltd.
Zhanjiang
Shenzhen Real
Estate 2,530,000.00 2,530,000.00 2,530,000.00
Development Co.,
Ltd.
Shum Yip
Properties
15,834,000.00 15,834,000.00 15,834,000.00
Development Co.,
Ltd.
SZPRD Xuzhou
Dapeng Real
Estate 50,000,000.00 50,000,000.00 50,000,000.00 50,000,000.00
Development Co.,
Ltd.
Total 231,846,672.93 37,620,000.00 269,466,672.93 50,000,000.00 69,964,000.00
(2) Investment to Joint Ventures and Associated Enterprises
Unit: RMB
221
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Increase/decrease
Ending
Gains and Adjustme
Cash Withdraw balance
Additiona losses nt of
Beginnin Reduced Changes bonus or al of Ending of
Investee l recognize other
g balance investmen of other profits impairme Other balance depreciati
investmen d under comprehe
t equity announce nt on
t the equity nsive
d to issue provision reserve
method income
I. Joint ventures
Shenzhen
Jifa
33,498,61 605,227.6 34,103,84
Warehous
2.76 4 0.40
e Co.,
Ltd.
Tianan
Internatio
nal
Building
Property 5,231,780 663,662.6 5,895,442
Managem .20 4 .84
ent
Company
of
Shenzhen
38,730,39 1,268,890 39,999,28
Subtotal
2.96 .28 3.24
II. Associated enterprises
Shenzhen
Wufang
Pottery & 18,983,61 18,983,61 18,983,61
Porcelain 4.14 4.14 4.14
Industrial
Co., Ltd.
18,983,61 18,983,61 18,983,61
Subtotal
4.14 4.14 4.14
57,714,00 1,268,890 58,982,89 18,983,61
Total
7.10 .28 7.38 4.14
（3）Other Notes
None
222
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
4. Operating Revenue and Cost of Sales
Unit: RMB
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 1,279,701,193.52 225,828,386.48 974,400,482.05 191,844,816.06
Other operations 943,396.23
Total 1,280,644,589.75 225,828,386.48 974,400,482.05 191,844,816.06
Other notes：
None
5. Investment Income
Unit: RMB
Item Reporting Period Same period of last year
Long-term equity investment income
433,297,336.35
accounted by cost method
Long-term equity investment income
1,268,890.28 1,978,501.84
accounted by equity method
Investment income from disposal of
565,632.29 135,696,301.09
long-term equity investment
Total 1,834,522.57 570,972,139.28
6. Other
Not applicable
XVIII. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
√ Applicable □ Not applicable
Unit: RMB
Item Amount Note
Gains/losses on the disposal of non-current
-79,489.58 Disposal of retail assets
assets
Government grants recognized in the current
period, except for those acquired in the
165,676.08 Subsidy for stabilizing posts
ordinary course of business or granted at
certain quotas or amounts according to the
223
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
government‘s unified standards
Other non-operating income and expense Income from penalty and liquidated
1,724,017.41
other than the above damages
Less: Income tax effects 448,375.57
Total 1,361,828.34 --
Explain the reasons if the Company classifies an item as an non-recurring gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √Not applicable
2. Return on Equity and Earnings Per Share
EPS (Yuan/share)
Profit as of Reporting Period Weighted average ROE (%)
EPS-basic EPS-diluted
Net profit attributable to ordinary
18.94% 0.9945 0.9945
shareholders of the Company
Net profit attributable to ordinary
shareholders of the Company after
18.89% 0.9923 0.9923
deduction of non-recurring profit or
loss
3. Differences between Accounting Data under Domestic and Overseas Accounting Standards
(1) Differences of Net Profit and Net Assets Disclosed in Financial Reports Prepared under International
and Chinese Accounting Standards
□ Applicable √ Not applicable
(2) Differences of Net profit and Net assets Disclosed in Financial Reports Prepared under Overseas and
Chinese Accounting Standards
□ Applicable √ Not applicable
(3) Explain Reasons for the Differences between Accounting Data under Domestic and Overseas
Accounting Standards; for any Adjustment Made to the Difference Existing in the Data Audited by the
Foreign Auditing Agent, Such Foreign Auditing Agent’s Name Shall Be Clearly Stated
Not applicable
4. Other
Comparative data
224
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
In the Reporting Period, for the sake of comparability of information disclosed, the Company made appropriate adjustments to some
of the comparable data for 2017 in the form of the disclosure for the Reporting Period.
225
ShenZhen Properties & Resources Development (Group) Ltd. Annual Report 2018
Part XII Documents Available for Reference
I The financial statements with the signatures and seals of the legal representative and the heads of
financial affairs and the financial department;
II The original copy of the Independent Auditor‘s Report with the seal of the CPA firm as well as
the signatures and seals of the certified public accountants; and
III The originals of all the Company‘s announcements and documents disclosed on the designated
media during the Reporting Period.
226
