Financial Report
I. Audit report
Unqualified opinions with major uncertainty paragraphs of
Type of audit opinion
continuous operations
Signing date of audit report 2019-04-18
Name of audit institute Baker Tilly China CPA (LLP)
Number of audit report Baker Tilly Zi[2019]No.: 3850
Name of CPA Chen Zhigang, Zhang Lei
Text of auditor’s Report
To all shareholders of Shenzhen China Bicycle Company (Holdings) Limited
I. Auditing opinions
We have audited the financial statement under the name of Shenzhen China Bicycle Company
(Holdings) Limited (hereinafter referred to as CBC), including the consolidated and parent
Company’s balance sheet of 31 December 2018 and profit statement, and cash flow statement, and
statement on changes of shareholders’ equity for the year ended, and notes to the financial
statements for the year ended.
In our opinion, the Company’s financial statements have been prepared in accordance with the
Enterprises Accounting Standards and Enterprises Accounting System, and they fairly present the
financial status of the Company and of its parent company as of 31 December 2018 and its
operation results and cash flows for the year ended.
II. Basis of opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public
Accountants of China. Our responsibilities under those standards are further described in the
“Auditor’s Responsibilities for the Audit of the Financial Statements” section of the auditor’s
report. We are independent of the Company in accordance with the Certified Public Accountants
of China’s Code of Ethics for Professional Accountants, and we have fulfilled our other ethical
responsibilities in accordance with the Code. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our opinion.
III. Major uncertainty with continuous operation concerned
We bring to the attention of the users of the financial statements, as stated in note XV of the
financial statements under the name of CBC, China Bicycle Company has completed
implementation of the restructuring plan dated 27 December 2013 and terminate the bankruptcy
proceedings, in which the condition of introduction of investors has been set out with a view to
restoring its ability to continue as a going concern and its sustainable profitability through asset
restructuring. Up to the reporting date of auditing, the Company has not introduced any investor,
but retained the business of bicycles so as to maintain its ability to continue as a going concern
before the injection of assets by investors. These events or circumstances indicate that there are
significant uncertainties that may cause significant doubts about the sustainable operation ability
of China Bicycle Company. This matter does not affect the published audit opinion.
IV. Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance
in our audit of the financial statements of the current period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters. The key audit matter we identified is as
follows:
Key audit matters Audit address
1. Revenue recognized
CBC mainly engages in the sales of bicycles, electric 1. Understand, test and evaluate the effectiveness of the
vehicles and relevant materials. In 2018, the main business internal control design and operation related to the
income of Shenzhen China Bicycle Company was RMB company’s sales and collections.
119,906,950.34, all of which were generated from domestic
2. Check the relevant provisions of customer contracts,
sales. Shenzhen China Bicycle Company took the receipt of
and pay attention to the changes in pricing methods,
products as the time point for confirming the sales revenue.
acceptance methods, delivery locations and deadlines,
Due to the significant amount of operating income, the
settlement methods, etc., and assess whether the company’s
authenticity of the revenue and whether it should be
recognition of income meets the requirements of the
included in the appropriate accounting period had a
accounting standards and whether it is consistent with the
significant impact on the operating results of the company
disclosed accounting policies.
in 2018, and there might be potential misstatements.
Therefore, we took the recognition of income as a key audit 3. Inquire and understand the background information of
matter. major customers through open channels, such as business
registration data, etc., confirm whether there are potential
unrecognized related party relationships between the
Please refer to the accounting policies said in “23. Income”
customer and the company and related parties.
of “Note III Significant Accounting Policies and
Accounting Estimate”, “20. Operation Revenue and Cost” 4. Check the customer information (such as contact
of “Note VI Combined Financial Statement Annotation and information, contact address, order time, etc.) of online
“4. Operating Income and Costs” of “Note XVI Financial marketing and evaluate the authenticity and rationality of
Statement Annotation of Parent Company” of the financial online marketing; examine the market price of main
statements annotation. materials and analyze the rationality of gross profit rate
fluctuation.
5.Inform the main customers of the current transaction
amount and fund balance by confirmation letters, and visit
important customers to verify the authenticity of the
company’s revenue recognition.
6. Check the contracts, warehouse receipts, delivery notes
and delivery receipt records of major customers
7. Check the delivery note within a certain period before and
after the balance sheet date, pay attention to the date of
receipt, and confirm whether the revenue recognition is
included in the correct accounting period.
Key audit matters Audit address
2. Impairment of account receivable
As of December 31, 2018, the balance of accounts 1. Understand and test the effectiveness of the internal
receivable of Shenzhen China Bicycle Company was RMB control design and operation related to the accounts
32,337,707.54, and the balance of bad debt provisions was receivable management
RMB 2,518,500, and the bad-debt provision transferred 2. Review the rationality and consistency of accounting
back was RMB 3,330,198.52. As the balance of accounts policies of the bad debt provision for accounts receivable of
receivable was significant and the assessment of bad debt the management, and review the rationality of major
provision involved the significant judgment of management, standards of single amount determined by the management.
we regarded the impairment of accounts receivable as a key
3. For the accounts receivable with separate provision for
audit matter.
bad debts, select samples to obtain management’s basis for
estimating the estimated future recoverable amount,
Please refer to the accounting policies said in “11. Accounts including customer credit record, default or delayed
Receivables” of Note III Significant Accounting Policies payment records, and actual repayment after date, and
and Accounting Estimate, “2. Note receivable and accounts review its rationality.
Receivables” of “Note VI Combined Financial Statement For the accounts receivable with provision for bad debts
Annotation”, and “1. Note receivable and accounts according to the aging analysis method, analyze the
Receivables” of “Note XVI Financial Statement Annotation rationality of the accounting estimates for the bad-debt
of Parent Company” of the financial statements annotation. provision of the accounts receivable of China Bicycle
Company, and select samples to test the accuracy of the
ageing.
V. Other information
The management of CBC (the “Management”) is responsible for other information which includes
the information covered in the Company’s 2018 annual report excluding the financial statement
and our audit report.
The audit opinion issued by us for the financial statement has not covered other information, for
which we do not issue any form of assurance opinions.
Considering our audit on financial statements, we are liable to read other information, during
which, we shall consider whether other information differs materially from the financial
statements or that we understand during our audit, or whether there is any material misstatement.
Based on the works executed by us, we should report the fact if we find any material misstatement
in other information. In this regards, we have nothing to report.
VI. Responsibilities of management and those charged with governance for the financial
statements
The management is responsible for the preparation of the financial statements in accordance with
the Accounting Standards for Enterprise to secure a fair presentation, and for the design,
establishment and maintenance of the internal control 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 matters related to going concern and using the
going concern assumption unless the management either intends to liquidate the Company or to
cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
VII. Responsibilities of the auditor for the 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 audit
report that includes our audit opinion. Reasonable assurance is a high level of assurance, but is not
a guarantee that an audit conducted in accordance with the 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 the financial statements.
As part of an audit in accordance with the 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 audit 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 assumption
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 the CAS to draw
users’ attention in audit report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify audit opinion. Our conclusions are based on the information
obtained up to the date of audit 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 audit opinion on the financial statements. We
are responsible for the direction, supervision and performance of the group audit. We remain
solely responsible for audit opinion.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant
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 independence, and
where applicable, related safeguard measures.
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 the 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 the auditor’s report because of the
adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
BeijingChina Chinese CPA: Chen Zhigang
18 April 2019 (Partner)
Chinese CPA: Zhang Lei
II. Financial statement
Unit in note of financial statement refers to CNY: RMB (Yuan)
1. Consolidated Balance Sheet
Prepared by Shenzhen China Bicycle Company (Holdings) Limited
2018-12-31
In RMB
Item Balance at period-end Balance at period-begin
Current assets:
Monetary fund 18,488,886.26 27,985,654.24
Settlement provisions
Capital lent
Financial assets measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial assets
Note receivable and account
29,007,509.02 30,507,775.21
receivable
Including: Note receivable 1,500,000.00
Account receivable 29,007,509.02 29,007,775.21
Account paid in advance 13,799,753.60 2,482,276.54
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Other account receivable 844,537.19 659,706.81
Including: Interest receivable
Dividend receivable
Buying back the sale of financial
assets
Inventory 2,386,603.94 2,777,174.63
Assets held for sale
Non-current asset due within one year
Other current assets 2,266,241.66 1,805,427.17
Total current assets 66,793,531.67 66,218,014.60
Non-current assets:
Loans and payments on behalf
Finance asset available for sales
Held-to-maturity investment
Long-term account receivable
Long-term equity investment
Investment real estate
Fixed assets 3,502,807.32 3,941,117.97
Construction in progress
Productive biological asset
Oil and gas asset
Intangible assets 1,506,000.00 2,259,000.00
Expense on Research and
Development
Goodwill
Long-term expenses to be apportioned
Deferred income tax assets 1,040,621.18 741,828.71
Other non-current assets 400,000.00 400,000.00
Total non-current asset 6,449,428.50 7,341,946.68
Total assets 73,242,960.17 73,559,961.28
Current liabilities:
Short-term loans
Loan from central bank
Absorbing deposit and interbank
deposit
Capital borrowed
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Note payable and account payable 11,979,010.69 12,408,197.27
Account received in advance 405,779.88 1,268,479.32
Selling financial asset of repurchase
Commission charge and commission
payable
Wage payable 435,736.16 706,703.40
Taxes payable 6,297,096.28 3,807,286.87
Other account payable 37,144,872.42 36,508,323.90
Including: Interest payable
Dividend payable
Reinsurance payable
Insurance contract reserve
Security trading of agency
Security sales of agency
Liability held for sale
Non-current liabilities due within one
year
Other current liabilities
Total current liabilities 56,262,495.43 54,698,990.76
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred stock
Perpetual capital securities
Long-term account payable
Long-term wages payable
Accrual liability
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 56,262,495.43 54,698,990.76
Owner’s equity:
Share capital 551,347,947.00 551,347,947.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital public reserve 627,834,297.85 627,834,297.85
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 32,673,227.01 32,673,227.01
Provision of general risk
Retained profit -1,197,549,169.92 -1,195,957,201.01
Total owner’s equity attributable to parent
14,306,301.94 15,898,270.85
company
Minority interests 2,674,162.80 2,962,699.67
Total owner’s equity 16,980,464.74 18,860,970.52
Total liabilities and owner’s equity 73,242,960.17 73,559,961.28
Legal Representative: Li Hai
Person in charge of Accounting Works: Sun Longlong
Person in charge of Accounting Institution: Zhong Xiaojin
2. Balance Sheet of Parent Company
In RMB
Item Balance at period-end Balance at period-begin
Current assets:
Monetary fund 8,889,572.73 15,398,405.80
Financial assets measured by fair value
and with variation reckoned into current
gains/losses
Derivative financial assets
Note receivable 及 Account receivable 12,827,954.16 17,980,663.16
Including: Note receivable 300,000.00
Account receivable 12,827,954.16 17,680,663.16
Account paid in advance 13,798,452.48 2,357,662.42
Other account receivable 380,925.78 280,576.37
Including: Interest receivable
Dividend receivable
Inventory
Assets held for sale
Non-current asset due within one year
Other current assets 2,130,677.11 1,792,452.81
Total current assets 38,027,582.26 37,809,760.56
Non-current assets:
Finance asset available for sales
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 10,379.73 10,379.73
Investment real estate
Fixed assets 2,995,407.48 3,309,465.26
Construction in progress
Productive biological asset
Oil and gas asset
Intangible assets 1,506,000.00 2,259,000.00
Expense on Research and Development
Goodwill
Long-term expenses to be apportioned
Deferred income tax assets
Other non-current assets 400,000.00 400,000.00
Total non-current asset 4,911,787.21 5,978,844.99
Total assets 42,939,369.47 43,788,605.55
Current liabilities:
Short-term loans
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Note payable and account payable
Account received in advance 327,632.18 1,086,506.70
Wage payable 151,598.60 112,896.71
Taxes payable 5,416,117.27 2,806,928.48
Other account payable 28,967,052.96 30,786,588.98
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within one
year
Other current liabilities
Total current liabilities 34,862,401.01 34,792,920.87
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred stock
Perpetual capital securities
Long-term account payable
Long-term wages payable
Accrual liability
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 34,862,401.01 34,792,920.87
Owner’s equity:
Share capital 551,347,947.00 551,347,947.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital public reserve 627,834,297.85 627,834,297.85
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 32,673,227.01 32,673,227.01
Retained profit -1,203,778,503.40 -1,202,859,787.18
Total owner’s equity 8,076,968.46 8,995,684.68
Total liabilities and owner’s equity 42,939,369.47 43,788,605.55
3. Consolidated Profit Statement
In RMB
Item Current Period Last Period
I. Total operation revenue 119,906,950.34 137,490,597.69
Including: Operation revenue 119,906,950.34 137,490,597.69
Interest income
Insurance gained
Commission charge and
commission income
II. Total operation cost 122,211,426.75 135,674,815.04
Including: Operation cost 108,071,430.05 124,027,332.26
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extras 727,636.82 197,163.09
Sales expenses 5,933,231.41 5,462,581.21
Administrative expenses 6,627,286.22 5,743,265.84
R&D expenses
Financial expenses -348,684.16 -209,569.66
Including: Interest
expenses
Interest income -369,745.70 -233,170.32
Losses of devaluation of
1,200,526.41 454,042.30
asset
Add: Other income
Investment income(Loss is
listed with “-”)
Including: Investment income
on affiliated company and joint venture
Changing income of fair
value(Loss is listed with “-”)
Exchange income (Loss is
listed with “-”)
Assets disposal income (Loss
-2,464.81
is listed with “-”)
III. Operating profit(Loss is listed with
-2,304,476.41 1,813,317.84
“-”)
Add: Non-operation revenue 4,634,304.77 4,629,029.13
Less: Non-operation expenditure 4,458,892.86 4,347,483.24
IV. Total Profit (Loss is listed with “-”) -2,129,064.50 2,094,863.73
Less: Income tax expenses -248,558.72 515,704.26
V. Net profit (Net loss is listed with
-1,880,505.78 1,579,159.47
“-”)
(I) Continuous operation net profit
-1,880,505.78 1,579,159.47
(Net loss is listed with “-”)
(ii) Discontinued operation net
profit (Net loss is listed with “-”)
Net profit attributable to owner’s
-1,591,968.91 1,529,587.27
of parent company
Minority shareholders’ gains and
-288,536.87 49,572.20
losses
VI. Net after-tax of other
comprehensive income
Net after-tax of other comprehensive
income attributable to owners of parent
company
(i) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes as a result of
re-measurement of net defined benefit
plan liability or asset
2.Other comprehensive
income unable transfer to gain/loss
under equity method
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive
income able to transfer to gain/loss
under equity method
2.Gains or losses arising
from changes in fair value of
available-for-sale financial assets
3.Gains or losses arising
from reclassification of held-to-maturity
investment as available-for-sale
financial assets
4.The effect hedging
portion of gains or losses arising from
cash flow hedging instruments
5.Translation differences
arising on translation of foreign
currency financial statements
6.Other
Net after-tax of other comprehensive
income attributable to minority
shareholders
VII. Total comprehensive income -1,880,505.78 1,579,159.47
Total comprehensive income
attributable to owners of parent -1,591,968.91 1,529,587.27
Company
Total comprehensive income
-288,536.87 49,572.20
attributable to minority shareholders
VIII. Earnings per share:
(i) Basic earnings per share -0.0029 0.0028
(ii) Diluted earnings per share -0.0029 0.0028
Enterprise combine under the same control in the Period, the combined party realized net profit of 0 Yuan before
combination, and realized 0 Yuan at last period for combined party
Legal Representative: Li Hai
Person in charge of Accounting Works: Sun Longlong
Person in charge of Accounting Institution: Zhong Xiaojin
4. Profit Statement of Parent Company
In RMB
Item Current Period Last Period
I. Operation revenue 33,859,463.41 24,505,590.30
Less: Operation cost 29,856,342.44 20,012,376.09
Tax and extras 572,884.38 720.00
Sales expenses 872,164.08
Administrative expenses 3,801,648.55 2,833,306.05
R&D expenses
Financial expenses -138,128.50 -2,696.71
Including: Interest
expenses
Interest income -146,307.16 -8,881.57
Losses of devaluation of asset -14,209.76 53,202.19
Add: Other income
Investment income(Loss is
listed with “-”)
Including: Investment income
on affiliated company and joint venture
Changing income of fair
value(Loss is listed with “-”)
Assets disposal income (Loss
is listed with “-”)
II. Operating profit(Loss is listed with
-1,091,237.78 1,608,682.68
“-”)
Add: Non-operation revenue 4,601,274.42 4,541,594.86
Less: Non-operation expenditure 4,428,752.86 4,332,392.64
III. Total Profit (Loss is listed with “-”) -918,716.22 1,817,884.90
Less: Income tax expenses 403,966.10
IV. Net profit (Net loss is listed with
-918,716.22 1,413,918.80
“-”)
(I) Continuous operation net profit
-918,716.22 1,413,918.80
(Net loss is listed with “-”)
(ii) Discontinued operation net
profit (Net loss is listed with “-”)
V. Net after-tax of other comprehensive
income
(i) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes as a result of
re-measurement of net defined benefit
plan liability or asset
2.Other comprehensive
income unable transfer to gain/loss
under equity method
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive
income able to transfer to gain/loss
under equity method
2.Gains or losses arising
from changes in fair value of
available-for-sale financial assets
3.Gains or losses arising
from reclassification of held-to-maturity
investment as available-for-sale
financial assets
4.The effect hedging
portion of gains or losses arising from
cash flow hedging instruments
5.Translation differences
arising on translation of foreign
currency financial statements
6.Other
VI. Total comprehensive income -918,716.22 1,413,918.80
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
5. Consolidated Cash Flow Statement
In RMB
Item Current Period Last Period
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 36,129,289.85 47,815,380.56
services
Net increase of customer deposit
and interbank deposit
Net increase of loan from central
bank
Net increase of capital borrowed
from other financial institution
Cash received from original
insurance contract fee
Net cash received from reinsurance
business
Net increase of insured savings and
investment
Net increase of amount from
disposal financial assets that measured
by fair value and with variation
reckoned into current gains/losses
Cash received from interest,
commission charge and commission
Net increase of capital borrowed
Net increase of returned business
capital
Write-back of tax received
Other cash received concerning
4,438,556.57 14,948,547.89
operating activities
Subtotal of cash in-flow from operation
40,567,846.42 62,763,928.45
activity
Cash paid for purchasing
commodities and receiving labor 30,870,252.63 42,234,146.49
service
Net increase of customer loans and
advances
Net increase of deposits in central
bank and interbank
Cash paid for original insurance
contract compensation
Cash paid for interest, commission
charge and commission
Cash paid for bonus of guarantee
slip
Cash paid to/for staff and workers 7,034,174.47 7,032,925.15
Taxes paid 2,508,051.27 2,108,578.13
Other cash paid concerning
9,634,842.21 14,819,857.08
operating activities
Subtotal of cash out-flow from
50,047,320.58 66,195,506.85
operation activity
Net cash flow from operation activities -9,479,474.16 -3,431,578.40
II. Cash flows arising from
investment activities:
Cash received from recovering
investment
Cash received from investment
income
Net cash received from disposal of
fixed, intangible and other long-term 60,000.00
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investment activities
Subtotal of cash in-flow from
60,000.00
investment activity
Cash paid for purchasing fixed,
17,293.82 658,054.98
intangible and other long-term assets
Cash paid for investment
Net increase of mortgaged loans
Net cash received from
subsidiaries and other units obtained
Other cash paid concerning
investment activities
Subtotal of cash out-flow from
17,293.82 658,054.98
investment activity
Net cash flow from investment
-17,293.82 -598,054.98
activities
III. Cash flows arising from financing
activities
Cash received from absorbing
investment
Including: Cash received from
absorbing minority shareholders’
investment by subsidiaries
Cash received from loans
Cash received from issuing bonds
Other cash received concerning
8,808,378.06 8,000,000.00
financing activities
Subtotal of cash in-flow from financing
8,808,378.06 8,000,000.00
activity
Cash paid for settling debts
Cash paid for dividend and profit
distributing or interest paying
Including:Dividend and profit of
minority shareholder paid by
subsidiaries
Other cash paid concerning
2,000,000.00 8,808,378.06
financing activities
Subtotal of cash out-flow from
2,000,000.00 8,808,378.06
financing activity
Net cash flow from financing activities 6,808,378.06 -808,378.06
IV. Influence on cash and cash
equivalents due to fluctuation in -0.09
exchange rate
VI. Net increased amount of cash and
-2,688,389.92 -4,838,011.53
cash equivalent
Add: Balance of cash and cash
19,177,276.18 24,015,287.71
equivalents at the period -begin
VI. Balance of cash and cash
16,488,886.26 19,177,276.18
equivalents at the period -end
6. Cash Flow Statement of Parent Company
In RMB
Item Current Period Last Period
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 191,824.00 1,965,727.01
services
Write-back of tax received
Other cash received concerning
5,803,118.03 18,392,380.58
operating activities
Subtotal of cash in-flow from operation
5,994,942.03 20,358,107.59
activity
Cash paid for purchasing
commodities and receiving labor 416,418.59 1,777,103.37
service
Cash paid to/for staff and workers 2,958,657.75 2,345,272.99
Taxes paid 1,101,894.37 341,557.38
Other cash paid concerning
8,014,959.57 9,620,841.25
operating activities
Subtotal of cash out-flow from
12,491,930.28 14,084,774.99
operation activity
Net cash flow from operation activities -6,496,988.25 6,273,332.60
II. Cash flows arising from
investment activities:
Cash received from recovering
investment
Cash received from investment
income
Net cash received from disposal of
fixed, intangible and other long-term
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investment activities
Subtotal of cash in-flow from
investment activity
Cash paid for purchasing fixed,
11,844.82 18,345.00
intangible and other long-term assets
Cash paid for investment
Net cash received from
subsidiaries and other units obtained
Other cash paid concerning
investment activities
Subtotal of cash out-flow from
11,844.82 18,345.00
investment activity
Net cash flow from investment
-11,844.82 -18,345.00
activities
III. Cash flows arising from financing
activities
Cash received from absorbing
investment
Cash received from loans
Cash received from issuing bonds
Other cash received concerning
8,000,000.00
financing activities
Subtotal of cash in-flow from financing
8,000,000.00
activity
Cash paid for settling debts
Cash paid for dividend and profit
distributing or interest paying
Other cash paid concerning
financing activities
Subtotal of cash out-flow from
financing activity
Net cash flow from financing activities 8,000,000.00
IV. Influence on cash and cash
equivalents due to fluctuation in -0.09
exchange rate
五. Net increased amount of cash and
-6,508,833.07 14,254,987.51
cash equivalent
Add: Balance of cash and cash
15,398,405.80 1,143,418.29
equivalents at the period -begin
VI. Balance of cash and cash
8,889,572.73 15,398,405.80
equivalents at the period -end
7. Statement of Changes in Owners’ Equity (Consolidated)
Current period
In RMB
Current period
Owners’ equity attributable to parent company
Other equity
instrument
Less: Other Provisio Minorit Total
Item Perpet
Capital Reason Surplus
Share Invento compre n of Retaine y owner’s
ual
prefer public able public
capital capita ry hensive general d profit interests equity
red Other reserve reserve reserve
l shares income risk
stock
securi
ties
551,34 -1,195,9
I. Balance at the 627,834 32,673, 2,962,6 18,860,
7,947. 57,201.
end of the last yea ,297.85 227.01 99.67 970.52
00 01
Add:
Changes of
accounting policy
Error
correction of the
previous period
Enterprise
combine under the
same control
Other
II. Balance at the 551,34 -1,195,9
627,834 32,673, 2,962,6 18,860,
beginning of this 7,947. 57,201.
,297.85 227.01 99.67 970.52
year 00 01
III. Increase/
Decrease in this -1,591,9 -288,53 -1,880,5
year (Decrease is 68.91 6.87 05.78
listed with “-”)
(i) Total
-1,591,9 -288,53 -1,880,5
comprehensive
68.91 6.87 05.78
income
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
owners
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
4. Other
(iii) Profit
distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
4. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Change amount
of defined benefit
plans that carry
forward retained
earnings
5. Other
(v) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(vi) Other
IV. Balance at the 551,34 -1,197,5
627,834 32,673, 2,674,1 16,980,
end of the report 7,947. 49,169.
,297.85 227.01 62.80 464.74
period 00 92
Last Period
In RMB
Last Period
Owners’ equity attributable to parent company
Other equity
instrument
Minorit
Less: Other Provisio Total
Item Perpet y
Capital Reason Surplus
Share Invento compre n of Retaine owner’s
ual interest
prefer public able public
capital capita ry hensive general d profit equity
red Other reserve reserve reserve s
l shares income risk
stock
securi
ties
551,34 -1,197,4
I. Balance at the 627,834 32,673, 2,913,1 17,281,
7,947. 86,788.
end of the last yea ,297.85 227.01 27.47 811.05
00 28
Add:
Changes of
accounting policy
Error
correction of the
previous period
Enterprise
combine under the
same control
Other
II. Balance at the 551,34 -1,197,4
627,834 32,673, 2,913,1 17,281,
beginning of this 7,947. 86,788.
,297.85 227.01 27.47 811.05
year 00 28
III. Increase/
Decrease in this 1,529,5 49,572. 1,579,1
year (Decrease is 87.27 20 59.47
listed with “-”)
(i) Total
1,529,5 49,572. 1,579,1
comprehensive
87.27 20 59.47
income
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
owners
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
4. Other
(iii) Profit
distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
4. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Change amount
of defined benefit
plans that carry
forward retained
earnings
5. Other
(v) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(vi) Other
IV. Balance at the 551,34 -1,195,9
627,834 32,673, 2,962,6 18,860,
end of the report 7,947. 57,201.
,297.85 227.01 99.67 970.52
period 00 01
8. Statement of Changes in Owners’ Equity (Parent Company)
Current period
In RMB
Current period
Other equity instrument
Perpetu Other
Capital Less: Surplus Total
Item Share comprehe Reasonab Retaine
al
preferre public Inventory public owner’s
capital capital Other nsive le reserve d profit
d stock reserve shares reserve equity
securiti income
es
I. Balance at the 551,347, 627,834,2 32,673,22 -1,202,8 8,995,684
end of the last yea 947.00 97.85 7.01 59,787. .68
18
Add: Changes
of accounting
policy
Error
correction of the
previous period
Other
II. Balance at the -1,202,8
551,347, 627,834,2 32,673,22 8,995,684
beginning of this 59,787.
947.00 97.85 7.01 .68
year 18
III. Increase/
Decrease in this -918,71 -918,716.
year (Decrease is 6.22 22
listed with “-”)
(i) Total
-918,71 -918,716.
comprehensive
6.22 22
income
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
owners
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
4. Other
(iii) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
3. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Change amount
of defined benefit
plans that carry
forward retained
earnings
5. Other
(v) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(vi) Other
IV. Balance at the -1,203,7
551,347, 627,834,2 32,673,22 8,076,968
end of the report 78,503.
947.00 97.85 7.01 .46
period 40
Last Period
In RMB
Last Period
Other equity instrument Other
Capital Less: Surplus Total
Item Share comprehe Reasonab Retaine
Perpetu
preferre public Inventory public owner’s
capital al Other nsive le reserve d profit
d stock reserve shares reserve equity
capital income
securiti
es
-1,204,2
I. Balance at the 551,347, 627,834,2 32,673,22 7,581,765
73,705.
end of the last yea 947.00 97.85 7.01 .88
98
Add: Changes
of accounting
policy
Error
correction of the
previous period
Other
II. Balance at the -1,204,2
551,347, 627,834,2 32,673,22 7,581,765
beginning of this 73,705.
947.00 97.85 7.01 .88
year 98
III. Increase/
Decrease in this 1,413,9 1,413,918
year (Decrease is 18.80 .80
listed with “-”)
(i) Total
1,413,9 1,413,918
comprehensive
18.80 .80
income
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
owners
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
4. Other
(iii) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
3. Other
(iv) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4. Change amount
of defined benefit
plans that carry
forward retained
earnings
5. Other
(v) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(vi) Other
IV. Balance at the -1,202,8
551,347, 627,834,2 32,673,22 8,995,684
end of the report 59,787.
947.00 97.85 7.01 .68
period 18
III. Company Profile
1. History and basic information
According to the Approval Document SFBF (1991) No. 888 issued by the People’s Government of
Shenzhen, Shenzhen China Bicycle Company (Holdings) Limited (hereinafter referred to as the
Company) was reincorporated as the company limited by shares in November 1991. On 28
December 1991, upon the Approval Document SRYFZ(1991) No. 119 issued by Shenzhen Special
Economic Zone Branch of the People’s Bank of China, the Company got listed on Shenzhen Stock
Exchange,Registered capital of the Company amounted as 551,347,947.00 Yuan.
Legal representative: Li Hai
Location: No. 3008, Buxin Road, Luohu District, Shenzhen
Certificate for Uniform Social Credit Code: 914403006188304524
2. Business nature and main operation activities
The Company's industry: machinery manufacturing industry
Main operation activities: The production and assembly of various bicycles and spare parts,
components, parts, mechanical product, sport machinery, fine chemicals, carbon fiber composites
material, household electrical appliance and affiliated components (products management by license excluded).
The majority of its products were previously exported, however, the sales volume sharply declined
in recent years because of the antidumping litigation. Hence, the Company commences on the debt
reorganization and the reorganization plan was completed on 27 December 2013 with bankruptcy
proceedings terminated. Meanwhile, makes greater efforts to develop and research the new
products, and creates a range of electrical bicycles to occupy the domestic market.
Main products and services provided so far: EMMELLE bicycles, electrical bicycles and lithium
battery material
3. Release of the financial report
The Financial Report released on 18 April 2019 after approved by 11th session of 10th BOD of the
Company
One subsidiary included in consolidate scope in the period, found more in Note IX- equity in other
entity and Note VIII Change of consolidate scope
IV. Compilation Basis of Financial Statement
1. Compilation Basis
The financial statement is prepared based on continuing operation assumptions, and according to
actual occurrence, in line with relevant accounting rules and follow important accounting policy
and estimation.
2. Going concern
On 11 May 2012, the largest shareholder and biggest creditor of the Company, Shenzhen
Guosheng Energy Investment Development Co., Ltd. applied to Shenzhen Municipal Intermediate
People's Court for reforming the Company as the Company couldn’t pay off the matured debts and
was seriously insolvent. On 12 October 2012, Shenzhen Municipal Intermediate People's Court
ruled to accept the application proposed by Guosheng Energy according to (2012) Shenzhen
Intermediate Court Po Zi No. 30 civil ruling. On the last ten-day of October 2012, Shenzhen
Municipal Intermediate People's Court ruled to reform the Company since 25 October 2012
according to (2012) Shenzhen Intermediate Court Po Zi No. 30-1 civil ruling, appointed King &
Wood (Shenzhen) Mallesons and Shenzhen ZhengYuan Liquidation Affairs Co., Ltd. as the
custodians of the Company. On the same day, Shenzhen Municipal Intermediate People's Court
made (2012) Shenzhen Intermediate Court Po Zi No. 30-1 written decision, and approved the
Company to manage property and business affairs by itself under the supervision of custodians
according to the law. On 5 November 2013, the Shenzhen Intermediate People’s Court (2012)
Shen Zhong Fa Po Zi No. 30-6 Civil Ruling Paper judged that approved the reorganization plan of
the Company. On 27 December 2013, the Civil Ruling Paper Shenzhen Intermediate People’s
Court (2012) Shen Zhong Fa Po Zi No. 30-10 ruled that the reorganization plan of CBC was
completed and bankruptcy procedures of the Company closed down.
The Company has solved the debt problem by reforming, realized the net assets with positive
value, the main business of bicycle is able to be maintained and realizes the stable development.
The Company has set up the conditions for introducing the recombination party in the reforming
plan, and expects to restore the abilities of sustainable operation and sustained profitability by
reorganization. The conditions of introducing the recombination party includes: the assessed value
of net assets should be no less than 2 billion Yuan, the net assets in the same year for
implementing the major reorganization should be no less than 200 million Yuan. The Company
doesn’t have the recombination party at the moment.
V. Main accounting policy and Accounting Estimate
Whether the company needs to comply with the disclosure requirements of the particular industry
No
Tips for specific accounting policy and estimate:
Nil
1. Declaration on compliance with accounting standards
The financial statement prepared by the Company, based on follow compilation basis, is comply
with the requirement of new accounting standards for business enterprise issued by Ministry of
Finance and its application guide, commentate as well as other regulations (collectively referred to
as Accounting Standards for Business Enterprise), which is reflect a real and truth financial status
of the Company, as well as operation results and cash flow situations.
Furthermore, the statement has reference to the listing and disclosure requirement from “Rules
Governing the Disclosure of Information for Enterprise with Stock Listed No.15-general
regulation of financial report” (2014 Revised) and “Notice on Implementation of New Accounting
Standards for Listed Companies” (KJBH (2018) No. 453)
2. Accounting period
Calendar year is the accounting period for the Company, which is starting from 1 January to 31
December.
3. Business cycles
The business period for the Company, which is the Gregorian calendar starting from 1 January to
31 December
4. Recording currency
The Company and its subsidiaries take RMB as the standard currency for bookkeeping.
5. Accounting treatment for business combinations under the same control and those not
under the same control
(1) Accounting treatment for business combinations under the same control and those not under
the same control
For a business merger that is under the same control and is achieved by the Company through one
single transaction or multiple transactions, assets and liabilities obtained from that business
combination shall be measured at their book value at the combination date as recorded by the
party being absorbed in the consolidated financial statement of ultimate controlling party. Capital
reserve shall be adjusted as per the difference between the book value of obtained net assets and
the book value of paid consolidated consideration (or the nominal value of the issued shares) of
the Company; retained earnings shall be adjusted if the capital reserve is not sufficient for offset.
(2) Accounting treatment for Enterprise combine not under the same control
The Company will validate the difference that the combined cost is more than the fair value of the
net identifiable assets gained from the acquiree on the acquisition date as goodwill; where the
combined cost is less than the fair value of net identifiable assets gained from the acquiree during
business combination, the fair value and combined cost of various identifiable assets, liabilities
and contingent liabilities from the acquiree must be rechecked. Where the combined cost is, after
the recheck, still less than the fair value of net identifiable assets gained from the acquiree during
business combination, the difference shall be charged to current profits and losses.
As for business combination not under common control and realized through multiple transactions
and by steps, the Company shall make accounting treatment as follows:
1) Adjust the initial investment cost of long-term equity investments. As for stock equities held
before the acquisition date accounted according to the equity method, re-measurement is carried
out according to the fair value of the equity on the acquisition date. The balance between the fair
value and the book value is included in the current investment income. If the acquiree’s stock
equities held before the acquisition date involves changes of other comprehensive incomes and
other owner's equities under accounting with the equity method, the balance between the fair value
and the book value is included in the current investment income on the acquisition date, excluding
other comprehensive incomes incurred by changes due to re-measurement of net liabilities or net
assets of the defined benefit plan.
2) Confirm the goodwill (or include the amount in the profits and losses). The initial investment
cost of long-term equity investments adjusted in step 1 is compared with the fair value of net
identifiable assets of the subsidiary shared on the acquisition date. If the former is greater than the
latter, the balance is confirmed as goodwill; if the former is less than the latter, the balance is
included in the current profits and losses.
Loss of control of a subsidiary in multiple transactions in which it disposes equity interests of its
subsidiary in stages
(1)In determining whether to account for the multiple transactions as a single transaction
A parent shall consider all the terms and conditions of the transactions and their economic effects.
One or more of the following may indicate that the parent should account for the multiple
arrangements as a single transaction:
1) Arrangements are entered into at the same time or in contemplation of each other;
2) Arrangements work together to achieve an overall commercial effect;
3) The occurrence of one arrangement is dependent on the occurrence of at least one other
arrangement;
4)One arrangement considered on its own is not economically justified, but it is economically
justified when considered together with other arrangements.
(2)Accounting treatment for each of the multiple transactions forming part of a bundled
transactions which eventually results in loss of control the subsidiary during disposal of its
subsidiary in stages
If each of the multiple transactions forms part of a bundled transactions which eventually results
in loss of control the subsidiary, these multiple transactions should be accounted for as a single
transaction. In the consolidated financial statements, the difference between the consideration
received and the corresponding percentage of the subsidiary’s net assets in each transaction prior
to the loss of control shall be recognized in other comprehensive income and transferred to the
profit or loss when the parent eventually loses control of the subsidiary.
The remaining equity investment shall be re-measured at its fair value in the consolidated financial
statements at the date when control is lost. The difference between the total amount of
consideration received from the transaction that resulted in the loss of control and the fair value of
the remaining equity investment and the share of net assets of the former subsidiary calculated
continuously from the acquisition date or combination date based on the previous shareholding
proportion, shall be recognized as investment income for the current period when control is lost.
The amount previously recognized in other comprehensive income in relation to the former
subsidiary’s equity investment should be transferred to investment income for the current period
when control is lost
③Accounting treatment for each of the multiple transactions NOT forming part of a bundled
transactions which eventually results in loss of control the subsidiary during disposal of its
subsidiary in stages
If the Company doesn't lose control of investee, the difference between the amount of the
consideration received and the corresponding portion of net assets of the subsidiary shall be
adjusted to the capital reserve (capital /equity premium) in the consolidated financial statements.
If the Company loses control of investee, the remaining equity investment shall be re-measured at
its fair value in the consolidated financial statements at the date when control is lost. The
difference between the total amount of consideration received from the transaction that resulted in
the loss of control and the fair value of the remaining equity investment and the share of net assets
of the former subsidiary calculated continuously from the acquisition date or combination date
based on the previous shareholding percentage, shall be recognized as investment income for the
current period when control is lost. The amount previously recognized in other comprehensive
income in relation to the former subsidiary’s equity investment should be transferred to investment
income for the current period when control is lost.
6. Compilation method of consolidated financial statement
Consolidated financial statements are prepared by the Company in accordance with Accounting
Standard for Business Enterprise No. 33-Consolidated Financial Statements and based on financial
statements of parent company and its subsidiaries and other related information.
When consolidating the financial statements, the following items are eliminated: internal equity
investment and owners’ equity of subsidiaries, proceeds on internal investments and profit
distribution of subsidiaries, internal transactions, internal debts and claim. The accounting policies
adopted by subsidiaries are the same as parent company.
7. Classification of joint venture arrangement and accounting treatment for joint control
(1) Affirmation and classification of joint venture arrangement
Joint arrangement refers to an arrangement controlled by two or more than two participants. Joint
venture arrangement has the following characteristics: 1) Each participant is bound by the
arrangement; 2) Two or more participants carry out joint control on implementation of the
arrangement. Any participant cannot control the arrangement independently. Any participant for
joint control can stop other participants or participant combinations to independently control the
arrangement.
Joint control refers to the sharing of control over certain arrangement under related agreements,
and related activities of the arrangement must be determined only when obtaining the unanimous
consent of the parties sharing control.
Joint venture arrangement is classified in to joint operation and joint venture. Joint operation
refers to an arrangement that a joint party enjoys assets related to the arrangement and bears
liabilities related to the arrangement. Joint venture refers to an arrangement that a joint party only
has the power governing net assets of the arrangement.
(2) Accounting treatment of joint venture arrangement
Joint venture participants should confirm the following items related to interest shares in joint
venture and carry out accounting settlement according to relevant provisions of the Accounting
Standards for Business Enterprises: 1) confirm the assets held separately and confirm the assets
held jointly based on shares; 2) confirm the liabilities borne separately and confirm the liabilities
borne jointly based on shares; 3) confirm the income incurred after selling its shares in joint
venture output; 4) confirm the income after selling the joint venture outputs based on shares; 5)
confirm the expenses incurred separately and confirm the expenses incurred in joint venture based
on shares.
Joint venture participants should carry out accounting settlement for investments of the joint
venture according to provisions of Accounting Standards for Business Enterprises
No.2–Long-term Equity Investments.
8. Recognition of cash and cash equivalents
Cash in cash flow statement means the inventory cash and savings available for use anytime. Cash
equivalents refer to the short-term (generally due within three months since the date of purchase)
highly liquid investments that are readily convertible into known amounts of cash and that are
subject to an insignificant risk of change in value.
9. Foreign currency transaction and financial statement conversion
(1)Conversion for foreign currency transaction
When initially recognized, the foreign currency for the transaction shall be converted into CNY
amount according to the spot exchange rate on the date of transaction. For the foreign currency
monetary items, conversion must be based on the spot exchange rate on the balance sheet date and
the exchange difference incurred from different exchange rates, except for the exchange difference
of principal and interest incurred due to foreign currency loan related to acquisition or
construction of assets that qualify for capitalization, shall be charged to current profits and losses;
foreign currency non-monetary items measured with historical cost are still converted as per the
spot exchange rate on the transaction date and keep the RMB amount unchanged; foreign currency
non-monetary items measured with fair value shall be converted as per the spot exchange rate on
the date of determining the fair value and the difference shall be charged to current profits and
losses or other comprehensive income.
(2)Conversion of financial statements presented in foreign currencies
The asset and liability items in the balance sheet shall be converted at the spot exchange rate on
the balance sheet date; the owner’s equity items, except for the items of “undistributed profit”,
shall be converted at the spot exchange rate on the transaction date; the income and expenditure
items in the profit statement shall be converted at the spot exchange rate on the transaction date.
The translation difference of foreign financial statements conducted as above is recognized as
other comprehensive incomes.
10. Financial instruments
Financial instrument including the financial assets, financial liability and equity instrument
(1) Classification of financial assets and financial liability
Financial assets can be divided into four types while initially recognized: financial assets at fair
value through profit or loss (including transactional financial assets and those financial assets
designated as at fair value through profit or loss), held-to-maturity investments; loans &
receivables; available-for-sale financial assets.
Financial liability can be divided into two types while initially recognized: financial liability at fair
value through profit or loss (including transactional financial liability and those financial liabilities
designated as at fair value through profit or loss) and other financial liability
(2)Recognition, measurement and derecognition of financial assets and financial liabilities
Financial assets or financial liabilities are recognized when the Group becomes a party to the
contractual provisions of the instrument. Financial assets or financial liabilities are initially
measured at fair value. For financial assets and financial liabilities at fair value through profit or
loss, transaction costs are immediately recognized to profit or loss. For other financial assets or
financial liabilities, transaction costs are included in their initial recognized amounts.
Financial assets are subsequently measured at fair value without considering of the possible
transaction costs upon the disposal thereof in the future, except that: (1) Held-to-maturity
investments and loans and receivables are subsequently measured at amortised cost using the
effective interest method; and (2) Investments in equity instruments that do not have a quoted
price in an active market and whose fair value cannot be reliably measured, and derivative
financial assets that are linked to and must be settled by delivery of such unquoted equity
instruments, they are measured at cost.
Financial liabilities are subsequently measured at amortised cost using the effective interest
method, except that: (1) Financial liabilities at fair value through profit are subsequently measured
at fair value without considering of the possible transaction costs upon the settlement thereof in
the future; (2) Derivative financial liabilities that are linked to and must be settled by delivery of
an unquoted equity instrument without a quoted price in an active market whose fair value cannot
be reliably measured, they are subsequently measured at cost; and (3) Financial guarantee
contracts that are not designated as financial liabilities at fair value through profit or loss, or loan
commitments to provide a loan at a below-market interest rate, which are not designated at fair
value through profit or loss, subsequent to initial recognition, they are measured at the higher of:
(1) the amount determined in accordance with ASBE No. 13 “Contingencies”; and (2) the amount
initially recognized less cumulative amortisation recognized in accordance with the principles set
out in ASBE No. 14 “Revenue”.
Any gains or losses arising from changes in the fair value on financial assets or financial liabilities,
other than those hedging instrument, are accounted for as follows: (1) Gains or losses arising from
the change in fair value on financial assets or financial liabilities at fair value through profit or loss
are recorded as gains or losses from change in fair value; Any interest or dividend income earned
during the holding on such financial assets are recognized to profit or loss. On disposal, the
differences between the consideration received and initial recognized amount are recognized as
investment income and adjust to the gains or losses from change in fair value accordingly; and (2)
Changes in fair value of available-for-sale financial assets are recorded in the other comprehensive
income. Interest calculated using the effective interest method for the periods, in which the assets
are held, are recognized as investment income. Cash dividends from available-for-sale equity
investments are recognized as investment income when the dividends are declared by the investee.
On disposal, the differences between the considerations received and the carrying amounts of
financial assets after deducting the accumulated fair values adjustments previously recorded in the
other comprehensive income are recognized as investment income.
A financial asset is derecognized when the contractual rights to the cash flows from the financial
asset terminate, or when it transfers substantially all the risks and rewards of ownership of the
asset to another entity. A financial liability (or part of it) is derecognized only when the underlying
present obligations (or part of it) are discharged.
(3)Recognition and measurement on transfer of financial assets
If the Group has transferred substantially all the risks and rewards of ownership of the financial
asset to the transferee, the financial asset should be derecognized; If the Group retains
substantially all the risks and rewards of ownership of a financial asset, the transferred financial
asset should be recognized and the consideration received should be recognized as a financial
liability; If the Group neither transfers nor retains substantially all the risks and rewards of
ownership of a financial asset, it shall be accounted for as follows: (1)the financial asset should be
derecognized if the Group waives control over the asset; (2)it recognises the financial asset to the
extent of its continuing involvement in the transferred financial asset and recognises an associated
liability if the Group does not waives control over the asset.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the
difference of the following is recognized to profit or loss: (1) The carrying amount of the financial
asset transferred; and (2) The sum of the consideration received from the transfer and any
cumulative change of fair value that has been previously recognized in other comprehensive
income directly. If a part of the transferred financial asset qualifies for derecognition, the carrying
amount of the transferred financial asset is allocated between the part that continues to be
recognized and the part that is derecognized, based on the respective fair values of those parts. The
difference of the following is recognized to profit or loss: (i) The carrying amount allocated to the
part derecognized; and (ii) The sum of the consideration received for the part derecognized and
any cumulative change of fair value allocated to the part derecognized which has been previously
recognized in other comprehensive income directly.
(4)Determination of fair value of financial assets and financial liabilities
For a financial asset or financial liability which has an active market, the Group considers the
quoted price in the active market to determine its fair value. For a financial assets or financial
liability which has no active market, the Group uses a valuation technique (valuation techniques
include using recent arm’s length market transactions between knowledgeable, willing parties,
reference to the current fair value of another instrument that is substantially the same, discounted
cash flow analysis and option pricing models) to determine its fair value. For a financial asset
acquired or a financial liability assumed initially, its fair value is based on the price of market
transactions.
(5) Provision for impairment on financial assets other than account receivables
At each balance sheet date, the Group assesses the carrying amounts of its financial assets other
than those financial assets at fair value through profit or loss. If there is objective evidence that a
financial asset is impaired, the Group determines the amount of any impairment loss.
For a financial asset that is individually significant, the Company assesses the asset individually
for impairment. For a financial asset that is not individually significant, the Company assesses the
asset individually for impairment or includes the asset in a group of financial assets with similar
credit risk characteristics and collectively assesses them for impairment. If the Company
determines that no objective evidence of impairment exists for an individually assessed financial
asset (whether significant or not), it includes the asset in a group of financial assets with similar
credit risk characteristics and collectively reassesses them for impairment.
At the end of the reporting period, if there is objective evidence that an impairment loss on a
financial asset carried at amortized cost has occurred, an impairment loss is recognized as the
excess of the carrying amount of the financial asset over its present value of estimated future cash
flows to profit or loss. If an impairment loss has been incurred on an investment in unquoted
equity instrument without a quoted price in an active market whose fair value cannot be reliably
measured, or on a derivative financial asset that is linked to and must be settled by delivery of
such equity instrument, an impairment loss is recognized as the excess of the carrying amount of
the unquoted equity investment or a derivative financial asset over its present value of estimated
future cash flows discounted at the current market rate of return for a similar financial asset to
profit or loss.
An impairment is recognized where there is a significant decrease in the fair value of available for
sale financial assets, or taken into account all factors, the decrease trend is not temporary to profit
or loss. The cumulative loss arising from decline in fair value previously recognized directly in the
other comprehensive income is reclassified from the capital reserve to profit or loss.
(6)There is no reclassification of held-to-maturity investment which is not due into financial assets
available for sale during the period.
11. Note receivable and account receivable
(1) Account receivable with single significant amount and withdrawal single item bad debt provision
Single significant account: the single receivable has over 5
Account with single significant amount
million yuan at end of the period
At the end of the period, the receivables with significant single
amount are tested separately for impairment. If there is objective
evidence that they have been impaired, the impairment loss will
Withdrawal method for bad debt provision of account receivable
be recognized and the provision for bad debts will be made based
with single significant amount
on the balance between the present value of future cash flows
and its book value.
(2) Accounts receivable whose bad debts provision was accrued by combination based on
credit risk characteristics portfolio
Combination Bad debt provision accrual
Credit risk portfolio Age analysis method
Accrual bad debt provision by age analysis in combination:
√ Applicable □ Not applicable
Account age Accrual ratio Accrual ratio for other receivable
Within one year(one year included) 0.30% 0.30%
1－2 years 0.30% 0.30%
2－3 years 0.30% 0.30%
Over 3 years 100.00% 100.00%
In combination, withdrawal proportion of bad debt provision based on balance proportion
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods:
□ Applicable √ Not applicable
(3) Account receivable with minor single amount but with withdrawal bad debt provision for
single item
The Company conducts impairment test separately for
receivables that are not significant in single amount but have the
following characteristics, if there is objective evidence that they
Reasons for provision of bad debt reserve have been impaired, the impairment loss will be recognized and
the provision for bad debts will be made based on the balance
between the present value of future cash flows and its book
value; receivables that are in dispute with the other party or
involving litigation or arbitration; there are clear signs indicating
that the debtor is likely to be unable to fulfill the repayment
obligations of the receivables.
If the impairment test is carried out separately and there is
objective evidence that it has been impaired, the impairment loss
will be recognized and the provision for bad debts will be made
Provision method of bad debt reserve
based on the balance between the present value of future cash
flows and its book value.
12. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Classification of inventory
The inventory of the Company refers to such seven classifications as the raw materials, product in
process, goods on hand, wrap page, low value consumables, materials for consigned processing
and goods sold.
(2) Valuation of inventories
Inventories are initially measured at cost upon acquisition, which includes procurement costs,
processing costs and other costs. The prices of inventories are calculated using weighted average
method when they are delivered.
(3) Provision for inventory impairment
When a comprehensive count of inventories is done at the end of the period, provision for
inventory impairment is allocated or adjusted using the lower of the cost of inventory and the net
realizable value. The net realizable value of stock in inventory (including finished products,
inventory merchandize and materials for sale) that can be sold directly is determined using the
estimated saleable price of such inventory deducted by the cost of sales and relevant taxation over
the course of ordinary production and operation. The net realizable value of material in inventory
that requires processing is determined using the estimated saleable price of the finished product
deducted by the cost to completion, estimated cost of sales and relevant taxation over the course of
ordinary production and operation. The net realizable value of inventory held for performance of
sales contract or labor service contract is determined based on the contractual price; in case the
amount of inventory held exceeds the contractual amount, the net realizable value of the excess
portion of inventory is calculated using the normal saleable price.
Provision for impairment is made according to individual items of inventories at the end of the
period; however, for inventories with large quantity and low unit price, the provision is made by
categories; inventories of products that are produced and sold in the same region or with the same
or similar purpose or usage and are difficult to be measured separately are combined for provision
for impairment.
If the factors causing a previous write-off of inventory value has disappeared, the amount
written-off is reversed and the amount provided for inventory impairment is reversed and
recognized in profit or loss for the period.
(4)Inventory system
Perpetual inventory system is adopted.
13. Assets held for sale
The Company classifies such corporate components (or non-current assets) that meet the
following criteria as held-for-sale: (1) Disposable immediately under current conditions based on
similar transactions for disposals of such assets or practices for the disposal group; (2) Probable
disposal; that is, a decision has been made on a plan for disposal and an undertaking to purchase
has been obtained (the undertaking to purchase means a binding purchase agreement entered into
by the Company and other parties, which contains transaction price, time and adequately strict
punishments for breach of contract provisions, which renders the possibility of material
adjustment or revocation of the agreement is extremely minor), and the disposal is expected to be
completed within a year. Besides, approval from relevant competent authorities or regulatory
authorities has been obtained as required by relevant rules.
The expected net residual value of asset held for sale is adjusted by the Company to reflect its fair
value less selling expense, provided that the net amount shall not exceed the original carrying
value of the asset. In case that the original value is higher than the adjusted expected net residual
value, the difference shall be recorded in profit or loss for the period as asset impairment loss, and
allowance of impairment for the asset shall be provided. Impairment loss recognized in respect of
the disposal group held for sale shall be used to offset the carrying value of the goodwill in the
disposal group, and then offset the carrying value of the non-current assets within the disposal
group based on their respective proportion of their carrying value.
In respect of the non-current assets held for sale, if the net amount after their fair value less the
selling expenses increased as at the subsequent balance date, the reduced amount before will be
recovered and reversed in the assets impairment loss amount recognized after being classified as
held for sale, and the reversed amount will be recorded in the current profits or loss. The
impairment loss on assets recognized before being classified as held for sale will not be reversed.
In respect of the disposal group held for sale, if the net amount after their fair value less the selling
expenses increased as at the subsequent balance date, the reduced amount before will be recovered
and reversed in the assets impairment loss amount recognized in non-current assets after being
classified as held for sale, and the reversed amount will be recorded in the current profits or loss.
The reduced book value of the goodwill as well as the impairment loss on assets recognized before
the non-current assets are classified as held for sale will not be reversed. The subsequent reversed
amount in respect of the impairment loss on assets recognized in the disposal group held for sale
will increase the book value in proportion of the book value of each non-current assets (other than
goodwill) in the disposal group.
In respect of loss of control in a subsidiary arising from disposal of the investment in such
subsidiary, the investment in a subsidiary shall be classified as held for sale in its entirety in the
individual financial statement of the parent company, and all the assets and liabilities of the
subsidiary shall be classified as held for sale in the consolidated financial statement subject to that
the proposed disposal of investment in the subsidiary satisfies such conditions as required for
being classified as held for sale notwithstanding part equity investment will be retained by the
Company after such disposal.
14. Long-term equity investment
(1)Determination of investment costs
1) If it is formed by the business combination under the common control, and that the combining
party takes cash payment, transfer of non-cash assets, assumption of debts or issuance of equity
securities as the consolidation consideration, the shares of the book value of the owner’s equity
obtained from the combined party on the date of combination in the ultimate controlling party’s
consolidated financial statements shall be recognized as its initial investment cost. Capital reserves
shall be adjusted according to the balance between the initial investment cost for long-term equity
investment and the book value of paid consolidation consideration or the total face value of issued
shares (capital premium or equity premium). If capital reserves are insufficient for offset, retained
earnings shall be adjusted.
As for business combination under the common control realized by the Company through several
transactions, the initial investment cost of the investment shall be determined based on the share of
the carrying value of the owners’ equity of the consolidated party as calculated according to the
shareholding proportion on the consolidation date. Difference between initial investment cost and
the carrying value of long-term equity investment before combination and the sum of carrying
value of newly paid consideration for additional shares acquired on the date of combination is to
adjust capital reserve (capital premium or equity premium). If the balance of capital reserve is
insufficient, any excess is adjusted to retained earnings.
2) As for long-term equity investment formed from business combination not under common
control, the fair value of the consolidated consideration paid shall be deemed as the initial
investment cost on the acquisition date.
3) Except those ones formed by the business combination, for all items obtained by means of cash
payment, actually paid acquisition costs shall be taken as the initial investment cost. For those
ones obtained by the issuance of equity securities, the fair value of the issued equity securities
shall be taken as the initial investment cost. For those ones invested by investors, the value agreed
in the investment contract or agreement shall be taken as the initial investment cost, provided that
the value agreed in the contract or agreement shall be fair.
(2)Subsequent measurement and profit or loss recognition
For a long-term equity investment where the Company can exercise control over the investee, the
long-term investment is accounted for using the cost method in the Company’s financial
statements. The equity method is adopted when the Group has joint control, or exercises
significant influence on the investee.
Under cost method, long term equity investment is measured at initial investment cost. Except for
the price actually paid for obtaining the investment or the cash dividends or profits declared but
not yet distributed which is included in the consideration, the Company recognizes cash dividends
or profits declared by the investee as current investment gains, and determine whether there is
impairment on long term investment according to relevant assets impairment policies.
Under equity method, when the initial investment cost of the long-term equity investment exceeds
the share of fair value in the net identifiable assets in the investee, the difference shall be included
in initial investment cost of the long-term equity investment. When the initial investment cost is
lower than the share of fair value in the net identifiable asset in the investee, such difference is
recognized in profit or loss for the period with adjustment of cost of the long-term equity
investment.
Under equity method, after the Company acquires a long-term equity investment, it shall, in
accordance with its attributable share of the net profit or loss realized by the investee, recognize
the investment profit or loss and adjust carrying value of the investment. The Group recognizes its
share of the investee’s net profits or losses after making appropriate adjustments to the investee’s
net profits and losses based on the fair value of the investee’s identifiable assets at the acquisition
date, using the Group’s accounting policies and periods, and eliminating the portion of the profits
or losses arising from internal transactions with its joint ventures and associates, attributable to the
investing entity according to its shareholding proportion (but impairment losses for assets arising
from internal transactions shall be recognized in full). The carrying amount of the investment is
reduced based on the Group’s share of any profit distributions or cash dividends declared by the
investee. The Group’s share of net losses of the investee is recognized to the extent the carrying
amount of the investment together with any long-term interests that in substance form part of its
net investment in the investee is reduced to zero, except that the Group has the obligations to
assume additional losses. The Group adjusts the carrying amount of the long-term equity
investment for any changes in owners’ equity of the investee (other than net profits or losses) and
includes the corresponding adjustments in the owners’ equity of the Group.
(3) Determination of control and significant influence on investee
Control is the power over an investee. An investor must have exposure or rights to variable returns
from its involvement with the investee, and the ability to use its power over the investee to affect
the amount of the investor’s returns. Significant influence is the power to participate in the
financial and operating policy decisions of the investee but is not control or joint control with
other parties over those policies
(4)Disposal of long-term equity investment
1) Partial disposal of long term investment in which control is retained
When long term investment is been partially disposed but control is retained by the company, the
difference between disposal proceeds and carrying amount of the proportion being disposed is
accounted for through profit or loss.
2) Partial disposal of long term investment in which control is lost
When long term investment is partially disposed and control is lost as a result, the carrying value
of the long term invest on the stock right, the difference between carrying amount of the part being
disposed and disposal proceeds should be recognized as profit or loss. The residual part should be
treated as long term investment or other financial assets according to their carrying amount. After
partial disposal, if the company is able to exert significant influence or common control over the
investee, the investment should be measured according to cost method or equity method, in
compliance with relevant accounting standards and regulations.
(5)Impairment test and provision for impairment
If there is objective evidence on the balance sheet date showing investment in subsidiaries,
associates and joint ventures is impaired, provision of impairment shall be made against the
difference between the carrying amount and the recoverable amount of the investment.
15. Investment real estate
Measurement mode
Measured by cost method
Depreciation or amortization method
(1) Investment property including land use right which has been rented out, land use right which
is held for transfer upon appreciation and buildings which has been rented out.
(2) Investment properties are initially measured at cost and subsequently measured as per the cost
pattern, and relevant withdrawal of provision for depreciation or amortization is carried out by the
same method for fixed assets and intangible assets. As of the balance sheet date, where there is
any indication that an investment property experiences impairment, the relevant impairment
provision shall be provided for based on the difference between the carrying value and the
recoverable amount.
16. Fixed assets
(1) Confirmation conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or operation, and with
a service life in excess of 1 financial year. Fixed assets may be recognized unless it simultaneously meets the
conditions as follows: ①The economic benefits pertinent to the fixed asset are likely to flow into the enterprise;
and ②The cost of the fixed assets can be measured reliably.
(2) Depreciation methods
Category Method Years of depreciation Scrap value rate Yearly depreciation rate
Housing buildings Straight-line depreciation 20 10% 4.5%
Machinery equipment Straight-line depreciation 10 10% 9%
Office equipment Straight-line depreciation 5 10% 18%
Electronic equipment Straight-line depreciation 5 10% 18%
Means of transportation Straight-line depreciation 5 10% 18%
Other equipment Straight-line depreciation 5 10% 18%
Nil
(3) Recognization basis, valuation and depreciation method for financial lease assets
Finance lease is determined when one or a combination of the following conditions are satisfied:
(1) the ownership has been transferred to the lessee when the leasing term is due; (2) the lessee has
the option to purchase the leasing asset at a price that is much lower than its fair value, so it can be
reasonably determined that the lessee will take the option at the very beginning of the lease; (3)
the leasing term accounts for most time of the useful life (ordinarily accounting for 75% or higher)
even if the ownership does not transfer to the lessee; (4) the present value of the minimum amount
of rent that the lessee has to pay at the first day of the lease amounts to 90% or higher of its fair
value at the same date; or the present value of the minimum amount of rent that the lessor collects
at the first day of the lease amounts to 90% or higher of its fair value at the same date; and/or (5)
the leased assets are of such a specialized nature that only the lessee can use them without major
modifications. Fixed assets rented-in under finance lease are recorded at the lower of fair value
and the present value of the minimum lease payment at the inception of the lease, and are
depreciated following the depreciation policy for self-owned fixed assets.
17. Construction in progress
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1)When the construction in progress has reached the intended condition for use, it will be treated
as fixed assets as per the actual construction cost. If the construction in progress has reached the
intended condition for use but completion accounting is not carried out, the construction in
progress should be first treated as fixed assets as per the estimated value. After completion
accounting is carried out, the original estimated value should be adjusted as per the actual cost, but
the provision for depreciation withdrawn should not be adjusted.
(2)As of the balance sheet date, where there is any indication that a construction in process
experiences impairment, the relevant impairment provision shall be provided for based on the
difference between the carrying value and the recoverable amount.
18. Borrowing expenses
(1)Principles of recognizing capitalization of borrowing expenses
The borrowing expenses of the Company directly attributable to the construction or production of
an asset meeting capitalization conditions are capitalized and recognized in relevant asset costs;
other borrowing expenses are recognized as expenses based on the amount incurred and
recognized in profit or loss for the period.
An asset that meets the capitalization conditions refers to fixed assets, real estate investments and
inventories that require a considerable amount of time for construction or production to reach the
expected usable or saleable condition.
Borrowing expenses are capitalized when all of the following conditions are met:
①the asset expense has occurred, which includes expenses in the form of cash paid, nonmonetary
asset transferred or interest-bearing obligations assumed for the construction or product of an asset
that meets capitalization conditions;
②the borrowing expenses have occurred;
③the necessary construction or production activities for bringing the asset to the expected usable
or saleable conditions have started.
Capitalization of borrowing expenses is suspended when any abnormal interruption continues for
over three months during the construction or production of an asset that meets capitalization
conditions.
When the construction or production of an asset meeting capitalization conditions has reached
expected useful or saleable conditions, the capitalization of borrowing expenses is stopped.
When the a portion of the construction or production of an asset meeting capitalization conditions
has completed and can be used individually, the capitalization of borrowing expenses of such
portion of asset is stopped.
(2)Capitalization period of borrowing expenses
Capitalization period refers to the time starting from the borrowing expenses are capitalized to the
time capitalization is stopped, except for the period which capitalization of borrowing expenses is
suspended.
(3) Calculation of capitalized amount of borrowing expenses
Interest expenses of special loans (net of interest income from unutilized loans deposited in bank
or investment gain earned from temporary investment) and supplementary expenses incurred for
the construction or production of asset that meets capitalization conditions before the asset reaches
expected useable or saleable condition are capitalized.
The interest amount that should be capitalized on normal borrowings is calculated based on the
weighted average of expenses of the aggregate asset exceeding the expenses of the portion of
special loan multiplied by the capitalization ratio of the normal borrowings utilized. Capitalization
ratio is calculated based on normal weighted average interest rate.
19. Biological assets
Nil
20. Oil and gas asset
Nil
21. Intangible assets
(1) Valuation method, service life and impairment test
(1) Intangible assets include land use right, patent right and non-patent technology, which should
be initially measured at cost.
(2) Intangible assets with limited service life should be amortized systematically and reasonably in
their service lives as per the expected form of realization economic benefits relating to the said
intangible assets. If the form of realization cannot be reliably determined, the intangible assets
should be amortized on a straight-line basis.
(3)At the balance sheet date, when there is any indication that the intangible assets with finite
useful lives may be impaired, a provision for impairment loss is recognized on the excess of the
carrying amounts of the assets over their recoverable amounts. Intangible assets with infinite
useful lives and intangible assets not satisfying the condition for use yet are subject to impairment
test each year notwithstanding whether the assets are impaired.
(2) Internal accounting policies relating to research and development expenditures
Expenditure incurred in the research phase of internal R&D shall be included in current gain/loss
at the time of occurrence.
Intangible assets recognized for expenditure in exploitation stage by satisfying the followed at
same time:
①it is technically feasible that the intangible asset can be used or sold upon completion;
②there is intention to complete the intangible asset for use or sale;
③the intangible asset can produce economic benefits, including there is evidence that the products
produced using the intangible asset has a market or the intangible asset itself has a market; if the
intangible asset is for internal use, there is evidence that there exists usage for the intangible asset;
④there is sufficient support in terms of technology, financial resources and other resources in
order to complete the development of the intangible asset, and there is capability to use or sell the
intangible asset;
⑤the expenses attributable to the development phase of the intangible asset can be measured
reliably.
22. Impairment of long-term assets
The Company makes a judgment on whether there is any sign of possible long-term assets
impairment on the balance sheet date. Where there is a sign indicating potential impairment, the
Company will estimate the recoverable amount. And if the recoverable amount of an asset is less
than its carrying value, the carrying value shall be written down to the recoverable amount, and
the amount written down shall be recognized as impairment loss and included in current profit or
loss. Meanwhile, the Company shall make impairment provision for the asset accordingly.
No matter whether there is any sign of possible assets impairment, the goodwill formed by the
merger of enterprises and intangible assets with uncertain service lives shall be subject to
impairment test every year.
The estimate of the recoverable amount of the assets are determined at the higher of the net
amount of the fair value less the disposal expenses and the present value of the estimated future
cash flows.
The Group estimates the recoverable amount on an individual basis. If it is not possible to estimate
the recoverable amount of the individual asset, the Group determines the recoverable amount of
the asset group to which the asset belongs.
Once the asset impairment loss is recognized, it will not be reversed in the subsequent periods
After the loss of asset impairment has been recognized, the depreciation or amortization expenses
of the impaired asset shall be adjusted accordingly in the future periods so as to amortize the
post-adjustment carrying value of the asset systematically (deducting the expected net residual
value) within the residual service life of the asset.
23. Long-term expenses to be apportioned
Long-term expenses to be apportioned are booked by actual amount occurred, and apportioned
evenly during the benefit period or regulated period.In case that the long-term deferred expenses
are not likely to benefit the subsequent accounting periods, the outstanding value of the item to be
amortized shall be included in current profit or loss in full.
24. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when staff providing service to the Company, the actual short-term
compensation occurred shall recognized as liabilities and reckoned into current gains/losses or
relevant assets costs. The non-monetary welfare is measured by fair value.
(2) Accounting treatment for post-employment benefit
The post-employment benefit including the defined contribution plans. And defined contribution
plans including basic endowment insurance, unemployment insurance and annuity, corresponding
payable amount will reckoned into relevant assets costs or current gains/losses while occurred.
(3) Accounting for retirement benefits
When the Company terminates the employment relationship with employees before the end of the
employment contracts or provides compensation as an offer to encourage employees to accept
voluntary redundancy, the Company shall recognize employee compensation liabilities arising
from compensation for staff dismissal and included in profit or loss for the current period, when
the Company cannot revoke unilaterally compensation for dismissal due to the cancellation of
labor relationship plans and employee redundant proposals; and the Company recognize cost and
expenses related to payment of compensation for dismissal and restructuring, whichever is earlier.
(4) Accounting for other long-term employee benefits
The employees of the Company have participated in the basic social endowment insurance
organized and implemented by the local labor and social security department. The Company pays
the endowment insurance premium to the local basic social endowment insurance agency on a
monthly basis based on the base and ratio of the local basic social endowment insurance payment.
After the retirement of employees, the local labor and social security department has the
responsibility to pay the social basic pension to the retired employees. During the accounting
period in which employees provide services, the Company recognizes the amount payable
calculated according to the above social security insurance regulations as the liabilities and
includes them in the current profit and loss or related asset costs.
25. Accrual liability
(1)When the obligations arising from provision of external guarantee, lawsuits, product quality
guarantee and contract loss and other contingent issues become the present obligations of the
company, the performance of which is likely to result in outflow of benefit from the company and
the amount of which can be measured reliably, the company shall recognize such obligations as
projected liabilities.
(2)Projected liabilities are initially measured at the best estimate on the expenses required to
perform the relevant present obligation by the Company, and the carrying value of project
liabilities are reviewed on each balance sheet date.
26. Share-based payment
(1)Types of share-based payment
Share-based payment comprises of equity-settled share-based payment and cash-settled
share-based payment.
(2)Determination of fair value of equity instruments
1)determined based on the price quoted in an active market if there exists active market for the
instrument.
2)determined by adoption of valuation technology if there exists no active market, including by
reference to the recent arm’s length market transactions between knowledgeable, willing parties,
reference to the current fair value of another instrument that is substantially the same, discounted
cash flow analysis and option pricing models.
(3)Basis for determination of the best estimate of exercisable equity instruments
To be determined based on the subsequent information relating to latest change of exercisable
employees.
(4)Accounting relating to implementation, amendment and termination of share-based payment
schemes
1)Equity-settled share-based payment
For equity instruments that may be exercised immediately after the grant, the fair value of such
instrument shall, on the date of the grant, be recognized in relevant costs or expenses with the
increase in the capital reserve accordingly. For equity-settled share-based payment made in return
for the rendering of employee services that cannot be exercised until the services are fully
rendered during vesting period or specified performance targets are met, on each balance sheet
date within the vesting period, the services acquired in the current period shall, based on the best
estimate of the number of exercisable instruments, be recognized in relevant costs or expenses and
the capital reserves at the fair value of such instruments on the date of the grant.
For equity-settled share-based payment made in exchange for service from other parties, such
payment shall be measured at the fair value of the service as of the acquisition date is the fair
value can be measured reliably. And if the fair value of the service cannot be measured reliably
while the fair value of the equity instrument can be measured reliably, it shall be measure at the
fair value of the instrument as of the date on which the service is acquired, which shall be
recorded in relevant cost or expense with increase in owners’ equity accordingly.
2)Cash-settled share-based payment
For the cash-settled share-based payment that may be exercised immediately after the grant in
exchange for render of service by employees, the fair value of the liability incurred by the
Company shall, on the date of the grant, be recognized in relevant costs or expenses and the
liabilities shall be increased accordingly. For cash-settled share-based payment made in return for
the rendering of employee services that cannot be exercised until the services are fully provided
during vesting period or specified performance targets are met, on each balance sheet date within
the vesting period, the services acquired in the current period shall, based on the best estimate of
the number of exercisable instruments, be recognized in relevant costs or expenses and the
corresponding liabilities at the fair value of the liability incurred by the Company.
3)Revision and termination of share-based payment schemes
If the revision results in an increase in the fair value of the equity instruments granted, the
Company shall recognize the increase in the services rendered accordingly at the increased fair
value of the equity instruments. If the revision results in an increase in the number of equity
instruments granted, the Company will recognize the increase in the services rendered accordingly
at the fair value of the increased number of equity instruments. If the Company revises the vesting
conditions on terms favorable to the employees, the Company will take into consideration of the
revised vesting conditions when dealing with the vesting conditions.
If the revision results in a decrease in the fair value of the equity instruments granted, the
Company shall continue recognize the amount of services rendered accordingly at the fair value of
the equity instruments on the date of grant without considering the decrease in the fair value of the
equity instruments. If the revision results in a decrease in the number of equity instruments
granted, the Company will account for such decrease by reducing part of the cancellation of equity
instruments granted. If the Company revises the vesting conditions on terms not favorable to the
employees, the Company will not take into consideration of the revised vesting conditions when
dealing with the vesting conditions.
If the Company cancels the equity instruments granted or settles the equity instruments granted
during the vesting period (other than cancellation as a result of failure to satisfy the vesting
conditions), such cancellation or settlement will be treated as accelerated exercisable rights and
the original amount in the remaining vesting period will be recognized immediately.
27. Other financial instruments including senior shares and perpetual bonds
(1) Distinguish of senior shares and perpetual bonds
The perpetual bonds and senior shares issued by the Company are treated as equity instruments
subject to satisfaction of all the below conditions:
①the financial instrument excludes delivery of cash or other financial assets to others, or
exchange for contractual obligations on financial assets or financial liabilities with others under
potential negative conditions;
②if its own equity instruments are required or may be used to settle the financial instruments, it
excludes the contractual obligation to deliver varied numbers of own equity instruments for
settlement provided that the financial instruments are non-derivatives; if the financial instruments
are derivatives, the Company can only settle the financial instruments by fixed number of own
equity instruments for exchange for fixed amount of cash or other financial assets.
Other than the financial instruments which can be classified as equity instruments under the above
conditions, other financial instruments issued by the Company shall be classified as financial
liabilities.
In case that financial instruments issued by the Company are compound financial instruments,
they shall be recognized as liabilities at the fair value of liabilities portion. The actual amount
received less fair value of the liabilities portion shall be recognized as other equity instrument.
Transaction expenses occurred in issuance of compound financial instruments are allocated to the
portions of liabilities and equities according to their respective proportion to the total issuance
price.
(2) Accounting for perpetual bonds and senior shares
For perpetual bonds and senior shares classified into financial liabilities, their relevant interest,
dividends, gains or losses and gains or losses arising from redemption or refinancing are all
included in current profit or loss other than those borrowing expenses which meet condition for
capitalization (please refer to Note V-18 “borrowing expenses”).
For perpetual bonds and senior shares classified into equity instruments, their issuance (including
refinancing), repurchase, sale or cancel are treated as change of equity, and relevant transaction
fees are also deducted from equity. The Company accounts for allocation of holders of equity
instruments as profit distribution.
The Company dose not recognizes change of fair value of equity instruments.
28. Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Sales of goods
Income from sale of goods is recognized when the following conditions are met: 1)the Company
has transferred the key risks and return on the ownership of the merchandize to the buyer; 2)the
Company has not retained continued management rights associated with ownership and no longer
exercises effective control on the merchandize sold; 3)the amount of income can be reliably
measured; 4)the relevant economic benefits are very likely to flow to the enterprise; 5)the costs
incurred or to be incurred can be reliably measured.
Timing for recognition of revenue of the Company from products sales: revenue is recognized
upon delivery of products to and confirmed by purchaser with signature.
(2)Rendering of services
When the outcome of the transaction can be estimated reliably, revenue from rendering of services
is recognized using the percentage of completion method. When the outcome of the transaction
cannot be estimated reliably at the balance sheet date, revenue is recognized based on the amount
of the costs incurred and the costs incurred are charged off at the same amount when the costs
incurred are expected to be recoverable; and no revenue is recognized and the costs incurred are
charged off as an expense of the period when the costs incurred are not expected to be recovered.
(3)Transfer of asset use right revenue
When the economic benefits related to the transaction is likely to flow to the Company and the
income amount can be reliably calculated, the Company shall recognize income arising from
transfer of asset use right. The income of interests is determined on basis of the time and real
interest rate of the Company’s cash funds which is utilized by other persons. The income of
royalties is determined on basis of the chargeable time and method fixed under relevant
agreement or contract.
29. Government Grants
(1) Government grants including those relating to assets and relating to income
(2)government grant, if granted as monetary assets, are measured at the amount received or
receivable, and measured at fair value if granted as non-monetary assets. If the fair value can not
be determined reliably, they shall be measured at nominal value.
(3) Aggregate method for government grants:
1)government grants relating to assets are recognized as deferred income, which shall be recorded
in profit or loss by installment reasonably and systematically within the useful life of the assets. If
assets are sold, transferred, discarded as useless or damaged prior to expiration of the useful life,
the remaining deferred income undistributed shall be transferred to profit or loss for the period in
which the assets are disposed.
2)If government grants relating to income are used to compensate for relevant costs or loss for the
subsequent periods, they shall be recognized as deferred income, and recorded in profit or loss for
the period in which the relevant costs are recognized. If government grants relating to income are
used to compensate for the relevant costs or loss occurred, they shall be recorded in profit or loss
for the period directly.
(4)Net method for government grants
1) Government grants relating to assets are used to write off the carrying value of the relevant
assets;
2) If government grants relating to income are used to compensate for relevant costs or loss for the
subsequent periods, they shall be recognized as deferred income, and recorded in profit or loss for
the period in which offset against the relevant costs. If government grants relating to income are
used to compensate for the relevant costs or loss occurred, they shall be offset against the relevant
costs for the period directly.
(5)The Company adopts aggregated accounting method for the government grants received.
(6)As for the government grants comprising both portions relating to assets and income, separate
accounting shall be made for different portion; in case it is hard to differentiate the portions, the
grants will be recorded as related to income in general.
(7)The Company realizes government grants relating to its normal activities as other income
based on the substance of economic business, and if not related to its normal activities, realized as
non-operating income and expenditure.
(8)Subsidized loans from preferential policy obtained by the Company are classified based on
whether subsidy funds are paid to the loaning bank or directly to the Company by the competent
financial authorities and are treated based on the following principles:
1)Where subsidy funds are paid to the loaning bank by the competent financial authorities and the
bank then provides loans to the Company at a preferential policy rate, accounting shall be made by
the Company as follows:
a. Recognizes the actual borrowing amount received as the carrying value of the loan, and
calculates the relevant borrowing costs based on the principal and the preferential policy rate.
b.Recognizes the fair value of the loan as the carrying value and calculates the borrowing cost
under effective interest method, and recognizes the difference between the actual amount received
and the fair value of the loan as deferred income. Deferred income is amortized over the term of
the loan under effective interest method and offset against the relevant borrowing costs.
2)Where subsidy funds are paid directly to the Company, the Company will offset the
corresponding subsidy against the relevant borrowing expenses.
30. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred tax assets or deferred tax liabilities are calculated and recognized based on the
difference between the carrying amount and tax base of assets and liabilities (and the
difference of the carrying amount and tax base of items not recognized as assets and liabilities
but with their tax base being able to be determined according to tax laws) and in accordance
with the tax rate applicable to the period during which the assets are expected to be recovered
or the liabilities are expected to be settled.
(2)A deferred tax asset is recognized to the extent of the amount of the taxable income, which it is
most likely to obtain and which can be deducted from the deductible temporary difference. At
the balance sheet date, if there is any exact evidence that it is probable that future taxable profits
will be available against which deductible temporary differences can be utilized, the deferred
tax assets unrecognized in prior periods are recognized.
(3)At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying
amount of a deferred tax asset is reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow the benefit of the deferred tax asset to be
utilized. Such reduction is subsequently reversed to the extent that it becomes probable that
sufficient taxable income will be available.
(4)The income tax and deferred tax for the period are treated as income tax expenses or income
through profit or loss, excluding those arising from the following circumstances: ① business
combination; and ② the transactions or items directly recognized in equity.
31. Lease
(1)Accounting for operating lease
When the Company is the lessee, lease payments are recognized as cost or profit or loss with
straight-line method over the lease term. Initial expenses are recognized directly into profit or loss.
Contingent rents are charged as profit or loss in the periods in which they are incurred.
When the Company is the lessor, lease income is recognized as profit or loss with straight-line
method over the lease term. Initial expenses, other than those with material amount and eligible
for capitalization which are recognized as profit or loss by installments, are recognized directly as
profit or loss. Contingent rents are charged into profit or loss in the periods in which they are
incurred.
(2)Accounting for financing lease
When the company acts as lessee, at the inception of lease, the lower of fair value of leased assets
at the inception of lease and the present value of minimum lease payment is recognized as the
value of leased assets. The minimum lease payment is recognized as the value of long-term
payable. Their difference is recorded as unrecognized finance costs with any initial direct expense
incurred recorded in the value of leased assets. For each period of the lease term, current finance
cost is calculated using effective interest method.
When the company acts as lessor, at the inception of lease, the sum of minimum lease income at
the inception of lease and the initial direct expense is recognized as the value of finance lease
payment receivable, with unsecured balance also recorded. The difference between the sum of
minimum lease income, initial direct expense and unsecured balance and the sum of their present
values is recognized as unrealized finance income. For each period of the lease term, current
finance income is calculated using effective interest method.
32. Other important accounting policy and estimation
Discontinued operation refers to the operation disposed or classified as held-for-sale by the
Company and presented separately under operation segments and financial statements, which has
fulfilled one of the following criteria:
(1) it represents an independent key operation or key operating region;
(2) it is part of the proposed disposal plan on an independent key operation or proposed disposal in
key operating region; or
(3) it only establishes for acquisition of subsidiary through disposal.
Accounting for discontinued operation is set out in note V-13 “classified as assets held for sale”.
33. Major accounting policy and changes
(1) Main accounting policy changes
√ Applicable □ Not applicable
The contents and reasons of accounting
Examination and approval procedures Note
policy changes
In consolidate balance sheet, the Note
Account receivable and Note receivable receivable and Account receivable has
are merged into “Note receivable and ending amount of 29,007,509.02 yuan,
account receivable” while amount at beginning of the period
was 30,507,775.21 yuan.
In consolidate balance sheet, the Note
Note payable and Account payable are payable and account payable has ending
merged into “Note payable and account amount of 11,979,010.69 yuan, while
payable” amount at beginning of the period was
12,408,197.27 yuan
(2) Changes of important accounting estimate
□ Applicable √ Not applicable
34. Other
Nil
VI. Taxes
1. Main tax category and tax rate
Tax category Tax calculation evidence Tax rate
Sales of goods, taxable labor service
Value added tax revenue, taxable income, intangible assets 5%. 6%. 16%. 17%
income and income from property leasing
Tax for maintaining and building cities Turnover tax payable 7%
Enterprise income tax Taxable income 25%
Educational surtax Turnover tax payable 3%
Local educational surtax Turnover tax payable 2%
Property tax 70% of the original value for property 1.2%
Amount of the contract for purchasing and
Stamp tax 0.03%
sales
Disclose reasons for different taxpaying body
Taxpaying body Income tax rate
2. Tax preference
Nil
3. Other
According to the Notice of the Ministry of Finance and the State Administration of Taxation on
Adjusting the Value-Added Tax Rate “CS [2018] No. 32”, from May 1, 2018, taxpayers having
VAT taxable sales or importing goods, which was originally applicable to 17% and 11% tax rate,
the tax rate is adjusted to 16% and 10%. The rate of value-added tax of the Company and its
subsidiaries has been adjusted to 16% since May 1, 2018.
VII. Notes to Items in Consolidated Financial Statements
1. Monetary fund
In RMB
Item Balance at period-end Balance at period-begin
Cash on hand 126,486.63 100,034.87
Cash in bank 16,305,989.07 18,837,402.11
OtherMonetary fund 2,056,410.56 9,048,217.26
Total 18,488,886.26 27,985,654.24
Including: total payments deposited
0.00 0.00
abroad
Other explanation
Other monetary fund with restricted application purposes at period-end amounted as 2,000,000.00 Yuan, refers to
the cash deposit for bank acceptance.
2. Financial assets measured by fair value and with variation reckoned into current
gains/losses
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
3. Derivative financial assets
□ Applicable √ Not applicable
4. Note receivable and account receivable
In RMB
Item Balance at period-end Balance at period-begin
Note receivable 1,500,000.00
Account receivable 29,007,509.02 29,007,775.21
Total 29,007,509.02 30,507,775.21
(1) Note receivable
1) Category of note receivable
In RMB
Item Balance at period-end Balance at period-begin
Bank acceptance 1,500,000.00
Total 1,500,000.00
2)Notes receivable already pledged by the Company at the end of the period
In RMB
Item Amount pledge at period-end
Bank acceptance 0.00
Bank acceptance bill 0.00
Total 0.00
3)Notes endorsement or discount and undue on balance sheet date
In RMB
Item Amount derecognition at period-end Amount not derecognition at period-end
Bank acceptance 46,548,529.37
Total 46,548,529.37 0.00
4)Notes transfer to account receivable due for failure implementation by drawer at period-end
In RMB
Item Amount transfer to receivable at period-end
Total 0.00
Other explanation
Nil
(2) Account receivable
1)Category of account receivable
In RMB
Balance at period-end Balance at period-begin
Book balance Bad debts provision Book balance Bad debts provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Account receivable
withdrawal bad debt
29,860,2 1,230,83 28,629,38 30,247, 1,240,186 29,007,775.
provision by group of 92.34% 4.12% 95.95% 4.10%
22.34 7.51 4.83 962.05 .84 21
credit risk
characteristics
Accounts with single
minor amount but
2,477,48 2,099,36 378,124.1 1,278,2 1,278,283
with bad debts 7.66% 84.74% 4.05% 100.00%
5.20 1.01 9 83.50 .50
provision accrued
individually
32,337,7 3,330,19 29,007,50 31,526, 2,518,470 29,007,775.
Total 100.00% 10.30% 100.00% 7.99%
07.54 8.52 9.02 245.55 .34 21
Receivable with single significant amount and withdrawal bad debt provision separately at end of period:
□ Applicable √ Not applicable
In combination, accounts receivable whose bad debts provision was accrued by age analysis:
√ Applicable □ Not applicable
In RMB
Balance at period-end
Account age
Account receivable Bad debts provision Accrual ratio
Within one year
Within one year 28,226,004.53 84,678.01 0.30%
Subtotal within one year 28,226,004.53 84,678.01 0.30%
1-2 years 488,301.90 1,464.91 0.30%
2-3 years 1,225.00 3.68 0.30%
Over 5 years 1,144,690.91 1,144,690.91 100.00%
Total 29,860,222.34 1,230,837.51 4.12%
Explanations on combination determine:
Nil
In combination, withdrawal proportion of bad debt provision based on balance proportion for account receivable:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for account receivable:
Nil
2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was 1,030,846.18 Yuan; the amount collected or switches back amounting to
219,118.00 Yuan
Important bad debt provision collected or switch back:
In RMB
Enterprise Collected or switch back amount Collection way
Shijiazhuang Dasong Tech. Co., Ltd 219,118.00 Returned money
Total 219,118.00 --
3)Account receivable actual charge off in the Period
In RMB
Item Amount written off
实际核销的 Account receivable 8,210.75
Written-off for the major receivable:
In RMB
Nature of account Verification Arising from related
Enterprise Amount written off Reason for write-off
receivable procedures transaction (Y/N)
Total -- 0.00 -- -- --
Explanation for write-off of receivables:
Nil
4)Top 5 receivables at ending balance by arrears party
Enterprise Relationship Amount Account age Bad debts Ratio in total Nature
with the provision receivables
company (%)
Shenzhen Weiterui New Energy Non-related 5,772,755.17 Within one 17,318.27 17.85 Paymen
Technology Co., Ltd. party year t for
goods
Zhengzhou Guiguan Tech. Trade. Co., Non-related 5,333,141.05 Within one 15,999.42 16.49 Paymen
Ltd party year t for
goods
Jinan Yuxintai Sales Co., Ltd. Non-related 5,280,959.55 Within one 15,842.88 16.33 Paymen
party year t for
goods
Shenzhen Jiahaosong Technology Co., Non-related 4,056,480.65 Within one 12,169.44 12.54 Paymen
Ltd. party year t for
goods
Fu Qi Non-related 2,457,269.40 Within two 7,371.81 7.60 Paymen
party years t for
goods
Total 22,900,605.82 68,701.82 70.81
5)Receivable derecognition due to transfer of financial assets
Nil
6)Assets and liability resulted by receivable transfer and continuous involvement
Nil
Other explanation:
Nil
5. Account paid in advance
(1) Listed by account age
In RMB
Balance at period-end Balance at period-begin
Account age
Amount Ratio Amount Ratio
Within one year 13,799,753.60 100.00% 2,482,276.54 100.00%
Total 13,799,753.60 -- 2,482,276.54 --
Explanation on un-settlement in time for advance payment with over one year account age and major amounts:
Nil
(2) Top 5 advance payment at ending balance by prepayment object
Relationship Ratio in total
Enterprise with the Amount Account age Nature advance e
company payment (%)
Zhaoqing Kaisite Battery Material Non-related 13,798,452.48 Within one Prepayments for 99.99
Co., Ltd. party year raw materials
Shenzhen JFM Package Material Co., Non-related 1,301.12 Within one Prepayments for 0.01
Ltd. party year raw materials
Total 13,799,753.60 100.00
Other explanation:
Nil
6. Other account receivable
In RMB
Item Balance at period-end Balance at period-begin
Other account receivable 844,537.19 659,706.81
Total 844,537.19 659,706.81
(1) Interest receivable
1)Category of interest receivable
In RMB
Item Balance at period-end Balance at period-begin
2)2)Major overdue interest
In RMB
Whether the impairment
Borrower Balance at period-end Overdue time Overdue cause occurs and its judgment
basis
Total 0.00 -- -- --
Other explanation:
Nil
(2) Dividend receivable
1)Dividend receivable
In RMB
Item(或 The invested enterprise) Balance at period-end Balance at period-begin
2)Important dividends payable with account age over one year
In RMB
Whether the impairment
Item(或 The invested
Balance at period-end Account age Un-recovered reasons occurs and its judgment
enterprise)
basis
Total 0.00 -- -- --
Other explanation:
Nil
(3) Other account receivable
1)Other accounts receivable by category
In RMB
Balance at period-end Balance at period-begin
Book balance Bad debts provision Book balance Bad debts provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Other receivables
with bad debt 1,331,92 487,383. 844,537.1 1,130,5 470,884.5
100.00% 36.59% 100.00% 41.65% 659,706.81
provision accrual by 0.95 76 9 91.40 9
credit portfolio
1,331,92 487,383. 844,537.1 1,130,5 470,884.5
Total 100.00% 36.59% 100.00% 41.65% 659,706.81
0.95 76 9 91.40 9
Other receivable with single significant amount and withdrawal bad debt provision separately at end of period
□ Applicable √ Not applicable
In combination, other accounts receivable whose bad debts provision was accrued by age analysis
√ Applicable □ Not applicable
In RMB
Balance at period-end
Account age
Other account receivable Bad debts provision Accrual ratio
Within one year
Within one year 624,378.43 1,873.14 0.30%
Subtotal within one year 624,378.43 1,873.14 0.30%
1-2 years 181,000.00 543.00 0.30%
2-3 years 41,700.00 125.10 0.30%
Over 3 years 484,842.52 484,842.52 100.00%
3-4 years 15,943.00 15,943.00 100.00%
4-5 years 20,164.00 20,164.00 100.00%
Over 5 years 448,735.52 448,735.52 100.00%
Total 1,331,920.95 487,383.76 36.59%
Explanations on combination determine:
Nil
In combination, withdrawal proportion of bad debt provision based on balance proportion for other account
receivable:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for other account receivable:
□ Applicable √ Not applicable
2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was 16,499.17 Yuan; the amount collected or switches back amounting to 0.00 Yuan
Important bad debt provision collected or switch back:
In RMB
Enterprise Amount reversal or collected Collection way
Total 0.00 --
Nil
3) Other receivables actually written-off during the reporting period
In RMB
Item Amount written off
Written-off for the major other receivable:
In RMB
Nature of other Verification Arising from related
Enterprise Amount written off Reason for write-off
receivables procedures transaction (Y/N)
Total -- 0.00 -- -- --
Explanation for write-off of other receivables:
Nil
4)Other receivables by nature
In RMB
Nature Ending book balance Opening book balance
Deposit or margin 783,672.00 628,997.24
Equipment fund 311,400.00 311,400.00
Staff personal loans 31,098.50 49,098.50
Other 205,750.45 141,095.66
Total 1,331,920.95 1,130,591.40
5)Top 5 other receivables at ending balance by arrears party
In RMB
Ratio in total ending
Balance at Ending balance of
Enterprise Nature Account age balance of other
period-end bad bet provision
receivables
Shenzhen Luwei
Mechatronic Equipment fund 300,000.00 Over 5 years 22.52% 300,000.00
Equipment Co., Ltd.
Shenzhen
Anjingheng Deposit and margin 266,000.00 Within one year 19.97% 798.00
Industrial Co., Ltd.
Shenzhen Material
Deposit and margin 181,918.00 Within one year 13.66% 545.75
Group Co., Ltd.
Alipay (China)
Network Technology Deposit and margin 170,000.00 Within two years 12.76% 510.00
Co., Ltd.
Tianjin Lvchi
Service charge 79,850.93 Within one year 6.00% 239.55
E-Business Co., Ltd.
Total -- 997,768.93 -- 74.91% 302,093.30
6)Account receivable with government grants involved
In RMB
Time, amount and basis
Enterprise Government grants Balance at period-end Ending account age of amount collection
estimated
Nil
7)Other account receivable derecognition due to financial assets transfer
Nil
8)Assets and liability resulted by other account receivable transfer and continuous involvement
Nil
Other explanation:
Nil
7. Inventory
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Category of inventory
In RMB
Balance at period-end Balance at period-begin
Item Depreciation Depreciation
Book balance Book value Book balance Book value
reserve reserve
Raw materials 388,818.51 23,015.17 365,803.34 566,193.56 27,465.37 538,728.19
Finished goods 2,382,433.75 361,633.15 2,020,800.60 2,233,386.81 4,450.20 2,228,936.61
Goods shipped in
9,509.83 9,509.83
transit
Total 2,771,252.26 384,648.32 2,386,603.94 2,809,090.20 31,915.57 2,777,174.63
Does the Company comply with the disclosure requirement of “Information Disclosure Guidelines of Shenzhen
Stock Exchange No.4 – Listed Companies Engaged in Seed Industry and Planting Business” or not
No
Does the Company comply with the disclosure requirement of “Information Disclosure Guidelines of Shenzhen
Stock Exchange No.11 – Listed Companies Engaged in Jewelry Related Business” or not
No
(2) Inventory depreciation reserve
In RMB
Current period increased Amount Current period decreased Amount
Balance at Balance at
Item Switch back or
period-begin Accrual Other Other period-end
write-off
Raw materials 27,465.37 4,450.20 23,015.17
Finished goods 4,450.20 364,088.31 6,905.36 361,633.15
Total 31,915.57 364,088.31 11,355.56 384,648.32
During normal production, the cash realizable value of inventories directly for sale, such as merchants and
materials for sale is accounted according to the estimated price less the estimated sales expenses and taxes. During
normal production, the cash realizable value of materials to be processed is accounted according to the estimated
price of finished product less the estimated cost, sales expenses and taxes. For inventories with purpose of
implementing sales contract or labor contract, the cash realizable value is based on the contract price; if the
inventories held exceed the ordered amount specified in the contract, the cash realizable value of surplus part is
accounted based on the market price.
(3) Explanation on capitalization of borrowing costs at ending balance of inventory
Nil
(4) Assets that completed without settlement from construction contract
In RMB
Item Amount
Other explanation:
Nil
8. Assets held for sale
In RMB
Expected disposal
Item Ending book value Fair value Expected disposal time
expenses
Total 0.00 0.00 0.00 --
Other explanation:
Nil
9. Non-current asset due within one year
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
10. Other current assets
In RMB
Item Balance at period-end Balance at period-begin
Prepaid intermediary fee 1,792,452.81 1,792,452.81
Prepaid tax 473,788.85 12,974.36
Total 2,266,241.66 1,805,427.17
Other explanation:
Prepaid intermediary fee refers to the prepaid, which paid to the intermediary organ as securities, auditing and
evaluation (according to the service contract), for preparation of privately placement, and the money is not
included in current gains/losses yet.
11. Finance asset available for sales
(1) Finance asset available for sales
In RMB
Balance at period-end Balance at period-begin
Item
Book balance Impairment Book value Book balance Impairment Book value
Total 0.00 0.00 0.00 0.00
(2) Financial assets available for sale measured by fair value at period-end
In RMB
Finance asset available Equity instrument Debt instrument
Total
for sales available for sale available for sale
Cost /liability of equity
instrument/ amortization 0.00
cost of debt instrument
Fair value 0.00
Amount of fair value
changes that
accumulatively reckoned 0.00
in other comprehensive
gains
Amount with impairment
0.00
accrual
(3) Financial assets available for sale measured by cost at period-end
In RMB
Book balance Impairment Ratio of
The share-holdi Current
Current Current Current Current
invested Period-beg Period-beg ng in cash
period period Period-end period period Period-end
enterprise inning inning invested dividend
increased decreased increased decreased
entity
Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -- 0.00
(4) Changes of impairment in Period
In RMB
Finance asset available Equity instrument Debt instrument
Total
for sales available for sale available for sale
Balance of impairment
0.00
accrual at period-begin
Current accrual 0.00
Including: transfer-in
from other 0.00
comprehensive income
Current period decreased 0.00
Including: switch back
due to fair value rebound 0.00
at period-end
Balance of impairment
0.00
accrual at period-end
(5) Fair value of equity instrument available for sale sharply declined or
other-than-temporary declined at period-end without depreciation reserves accrual
In RMB
Fair value Time of drops Amount with
Equity instrument Reasons for
Investment cost Ending fair value declined relative persistently impairment
available for sale un-accrual
to cost (month) accrual
Total 0.00 0.00 -- -- 0.00 --
Other explanation
Nil
12. Held-to-maturity investment
(1) Held-to-maturity investment
In RMB
Balance at period-end Balance at period-begin
Item
Book balance Impairment Book value Book balance Impairment Book value
Total 0.00 0.00 0.00 0.00
(2) Important held-to-maturity investment at period-end
In RMB
Bond Face value Coupon value Actual rate Maturity date
Total 0.00 -- -- --
(3) Held-to-maturity investment reclassify in the Period
Nil
Other explanation
Nil
13. Long-term account receivable
(1) Long-term account receivable
In RMB
Balance at period-end Balance at period-begin
Discount rate
Item Bad debts Bad debts
Book balance Book value Book balance Book value section
provision provision
Total 0.00 0.00 0.00 0.00 --
(2) Long-term account receivable derecognition due to transfer of financial assets
Nil
(3) Assets and liability resulted by long-term account receivable transfer and continuous
involvement
Nil
Other explanation
Nil
14. Long-term equity investment
In RMB
Current period changes +,-
Ending
Other Cash
Balance Investme Balance balance
The Additiona comprehe dividend
at nt gains Other at of
invested l Capital nsive or profit Impairme
period-be recognize equity Other period-en impairme
enterprise investmen reduction income announce nt accrual
gin d under change d nt
t adjustmen d to
equity provision
t issued
I. Joint venture
Subtotal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
II. Affiliated enterprise
Subtotal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Other explanation
Nil
15. Investment real estate
(1) Investment real estate measured at cost
□ Applicable √ Not applicable
(2) Investment real estate measured at fair value
□ Applicable √ Not applicable
(3) Investment real estate without property rights certificate
In RMB
Reasons for failing to complete the
Item Book value
property rights certificate
Other explanation
Nil
16. Fixed assets
In RMB
Item Balance at period-end Balance at period-begin
Fixed assets 3,502,807.32 3,941,117.97
Total 3,502,807.32 3,941,117.97
(1) Fixed assets
In RMB
Machinery Means of Electronic
Item Housing buildings Total
equipment transportation equipment and other
I. original book
value:
1.Balance at
2,959,824.00 416,629.06 958,593.21 684,394.50 5,019,440.77
period-begin
2.Current period
17,293.82 17,293.82
increased Amount
(1) Purchase 17,293.82 17,293.82
(2) construction
in process transfer-in
(3) the
increase in business
combination
3.Current period
475,800.00 475,800.00
decreased Amount
(1)Disposal or
475,800.00 475,800.00
scrap
4.Balance at
2,959,824.00 416,629.06 958,593.21 225,888.32 4,560,934.59
period-end
II. accumulated
depreciation
1.Balance at
199,788.12 109,246.12 269,780.13 499,508.43 1,078,322.80
period-begin
2.Current period
133,192.08 37,496.64 172,546.80 26,638.90 369,874.42
increased Amount
(1) provision 133,192.08 37,496.64 172,546.80 26,638.90 369,874.42
3.Current period
390,069.95 390,069.95
decreased Amount
(1)Disposal or 390,069.95 390,069.95
scrap
4.Balance at
332,980.20 146,742.76 442,326.93 136,077.38 1,058,127.27
period-end
III. Impairment
1.Balance at
period-begin
2.Current period
increased Amount
(1) provision
3.Current period
decreased Amount
(1)Disposal or
scrap
4.Balance at
period-end
IV. Book value
1.Ending book
2,626,843.80 269,886.30 516,266.28 89,810.94 3,502,807.32
value
2.Opening book
2,760,035.88 307,382.94 688,813.08 184,886.07 3,941,117.97
value
(2) Fixed assets temporary idle
In RMB
Accumulated
Item original book value: Impairment Book value Note
depreciation
(3) Fixed assets leased through operating lease
In RMB
Accumulated
Item original book value: Impairment Book value
depreciation
(4) Fixed assets leased through operating lease
In RMB
Item Ending book value
(5) Fixed assets without property rights certificate
In RMB
Reasons for failing to complete the
Item Book value
property rights certificate
The six properties of Lianxin Garden
with original value of 2,959,824.00 Yuan.
The property purchasing refers to the
indemnificatory housing for enterprise
talent buying from Shenzhen Housing and
Construction Bureau of Luohu District.
Six properties in Lianxin Garden 2,626,843.80
According to the agreement, the enterprise
shall not carrying any kind of property
trading with any units or individuals except
the government, and the company has no
property certification on the above
mentioned properties.
Other explanation
No accrual for impairment provision due to there was no evidence of impairment being found in
fixed assets at period-end
(6) Fixed assets disposal
In RMB
Item Balance at period-end Balance at period-begin
Other explanation
Nil
17. Construction in progress
In RMB
Item Balance at period-end Balance at period-begin
(1) Construction in progress
In RMB
Balance at period-end Balance at period-begin
Item
Book balance Impairment Book value Book balance Impairment Book value
Total 0.00 0.00 0.00 0.00
(2) Changes in significant construction in progress
In RMB
Accumul including
Proporti
Fixed ated : interest Interest
Other on of
increased assets amount capitaliz capitaliz
Opening decrease Ending project Sourceof
Item Budget in the transfer-i Progress of ed ation rate
balance d in the balance investme funds
Period n in the interest amount of the
Period nt in
Period capitaliz of the year
budget
ation year
Total 0.00 0.00 0.00 0.00 0.00 0.00 -- -- 0.00 0.00 0.00% --
(3) Depreciation reserves accrual
In RMB
Item Current accrual amount Reasons for accrual
Total 0.00 --
Other explanation
Nil
(4) Engineering materials
In RMB
Balance at period-end Balance at period-begin
Item
Book balance Impairment Book value Book balance Impairment Book value
Total 0.00 0.00 0.00 0.00
Other explanation:
Nil
18. Productive biological asset
(1) Productive biological assets measured by cost
□ Applicable √ Not applicable
(2) Productive biological assets measured by fair value
□ Applicable √ Not applicable
19. Oil and gas asset
□ Applicable √ Not applicable
20. Intangible assets
(1) Intangible assets
In RMB
Non-patent
Item Land use right Patent Trademark Total
technology
I. original book
value:
1.Balance at
5,271,000.00 5,271,000.00
period-begin
2.Current
period increased
Amount
(1) Purchase
(2) internal
R&D
(3) the
increase in business
combination
3.Current period
decreased Amount
(1) Disposal
4.Balance at
5,271,000.00 5,271,000.00
period-end
II. accumulated
depreciation
1.Balance at
3,012,000.00 3,012,000.00
period-begin
2.Current
period increased 753,000.00 753,000.00
Amount
(1) provision 753,000.00 753,000.00
3.Current
period decreased
Amount
(1) Disposal
4.Balance at
3,765,000.00 3,765,000.00
period-end
III. Impairment
1.Balance at
period-begin
2.Current
period increased
Amount
(1) provision
3.Current
period decreased
Amount
(1) Disposal
4.Balance at
period-end
IV. Book value
1.Ending book
1,506,000.00 1,506,000.00
value
2. Opening book
2,259,000.00 2,259,000.00
value
Ratio of intangible assets resulted from internal R&D in balance of intangible assets at period-end
(2) Land use right without certificate of title completed
In RMB
Reasons for failing to complete the
Item Book value
property rights certificate
Other explanation:
Nil
21. Expense on Research and Development
In RMB
Balance at Balance at
Item Current period increased Amount Current period decreased Amount
period-begin period-end
Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Other explanation
Nil
22. Goodwill
(1) Original book value of goodwill
In RMB
The invested Balance at Balance at
Current period increased Current period decreased
entity or items period-begin period-end
Total 0.00 0.00 0.00 0.00 0.00 0.00
(2) Goodwill Impairment
In RMB
The invested Balance at Balance at
Current period increased Current period decreased
entity or items period-begin period-end
Total 0.00 0.00 0.00 0.00 0.00 0.00
Information about the asset group or asset group combination in which the goodwill is located
Nil
Explain the method of confirming the goodwill impairment test process, key parameters (such as the forecast
period growth rate, stable period growth rate, profit rate, discount rate, forecast period, etc. when estimating the
present value of future cash flow), and the impairment loss of goodwill :
Nil
Impact of impairment test for goodwill
Nil
Other explanation
Nil
23. Long-term expenses to be apportioned
In RMB
Balance at Current period Amortized in the Balance at
Item Other decrease
period-begin increased Amount Period period-end
Total 0.00 0.00 0.00
Other explanation
Nil
24. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets un-offset
In RMB
Balance at period-end Balance at period-begin
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Bad debts provision 944,459.10 3,777,836.40 733,849.82 2,935,399.29
Inventory falling price
96,162.08 384,648.32 7,978.89 31,915.57
reserves
Total 1,040,621.18 4,162,484.72 741,828.71 2,967,314.86
(2) Deferred income tax liabilities un-offset
In RMB
Balance at period-end Balance at period-begin
Item Taxable temporary Deferred income tax Taxable temporary Deferred income tax
differences liabilities differences liabilities
Total 0.00 0.00 0.00 0.00
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
Ending balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Item deferred income tax
assets or liabilities after assets and liabilities at assets or liabilities after
assets and liabilities
off-set period-begin off-set
Deferred income tax
1,040,621.18 741,828.71
assets
(4) Details of unrecognized deferred income tax assets
In RMB
Item Balance at period-end Balance at period-begin
Total 0.00 0.00
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed
year
In RMB
Year Ending amount Opening amount Note
Total 0.00 0.00 --
Other explanation:
As stated under article 17 of the Enterprise Accounting Standards No.18-Income Tax, deferred income tax assets
and deferred income tax liabilities shall be measured at the tax rate applicable in the period in which the assets are
expected to be recovered or liabilities are expected to be settled according to relevant tax laws on the balance sheet
date. The tax rate adopted by the Company in calculating deferred income tax assets is 25% for both parent
company and subsidiaries.
25. Other non-current assets
In RMB
Item Balance at period-end Balance at period-begin
Advance payment for house 400,000.00 400,000.00
Total 400,000.00 400,000.00
Other explanation:
In 2016, the Company paid the four houses in advance for enterprise talent, located in Yinhu Lanshan, to Shenzhen
Housing and Construction Bureau of Luohu District, up to 31st December 2018, payment are not paid by Shenzhen
Housing and Construction Bureau of Luohu District yet
26. Short-term loans
(1) Short-term loans
In RMB
Item Balance at period-end Balance at period-begin
Explanation on short-term loans category:
Nil
(2) Overdue outstanding short-term loans
Total 0.00 Yuan overdue outstanding short-term loans at period-end, including the followed significant amount:
In RMB
Borrower Balance at period-end Lending rate Overdue time Overdue rate
Total 0.00 -- -- --
Other explanation:
Nil
27. Financial liability measured by fair value and with variation reckoned into current
gains/losses
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
28. Derivative financial liability
□ Applicable √ Not applicable
29. Note payable and account payable
In RMB
Item Balance at period-end Balance at period-begin
Note payable 2,000,000.00 8,480,000.00
Account payable 9,979,010.69 3,928,197.27
Total 11,979,010.69 12,408,197.27
(1) Category of note payable
In RMB
Category Balance at period-end Balance at period-begin
Bank acceptance 2,000,000.00 8,480,000.00
Total 2,000,000.00 8,480,000.00
Notes expired at period-end without paid was Yuan.
(2) Account payable
In RMB
Item Balance at period-end Balance at period-begin
Within one year(one year included) 9,713,137.52 3,638,705.30
1-2 years(2 years included) 7,099.50 137,423.41
2-3 years (3 years included) 137,423.41 3,084.95
3-4 years (4 years included) 2,366.00
Over 5 years 118,984.26 148,983.61
Total 9,979,010.69 3,928,197.27
(3) Important account payable with account age over one year
In RMB
Item Balance at period-end Reasons of un-paid or carry-over
Total 0.00 --
Other explanation:
No important account payable with account age over one year at end of the Period
30. Account received in advance
(1) Account received in advance
In RMB
Item Balance at period-end Balance at period-begin
Within one year(one year included) 371,039.28 1,211,804.44
1-2 years(2 years included) 3,469.60 19,777.88
2-3 years (3 years included) 2,080.00 36,897.00
Over 3 years 29,191.00
Total 405,779.88 1,268,479.32
(2) Account received in advance with over one year book age
In RMB
Item Balance at period-end Reasons of un-paid or carry-over
Total 0.00 --
(3) Projects that settle without completed from construction contract at period-end
In RMB
Item Amount
Other explanation:
Nil
31. Wage payable
(1) Wage payable
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
I. Short-term
706,703.40 6,292,582.05 6,563,549.29 435,736.16
compensation
II. Post-employment
benefit – defined 410,459.99 410,459.99
contribution plan
Total 706,703.40 6,703,042.04 6,974,009.28 435,736.16
(2) Short-term compensation
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
1. Wages, bonuses,allowances
699,994.68 5,425,458.24 5,696,710.60 428,742.32
andsubsidies
2. Welfare for workers
230,198.50 230,198.50
and staff
3. Social insurance 186,647.70 186,647.70
Including: Medical
162,830.82 162,830.82
insurance
Work injury
10,749.72 10,749.72
insurance
Maternity
13,067.16 13,067.16
insurance
4. Housing accumulation
360,199.04 360,199.04
fund
5. Labor union
expenditure and
6,708.72 78,333.33 78,048.21 6,993.84
personnel education
expense
Other short term pay
11,745.24 11,745.24
absenteeism
Total 706,703.40 6,292,582.05 6,563,549.29 435,736.16
(3) Defined contribution plans
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
1. Basic endowment
399,118.96 399,118.96
insurance
2. Unemployment
11,341.03 11,341.03
insurance
Total 410,459.99 410,459.99
Other explanation:
Nil
32. Taxes payable
In RMB
Item Balance at period-end Balance at period-begin
Value-added tax 5,716,531.88 3,391,621.62
Enterprise income tax 339,193.85
Individual income tax 25,288.27 23,164.05
Urban maintenance and construction tax 325,396.78 7,615.81
House property tax 45,070.60
Educational surtax 227,569.65 620.94
Stamp tax 2,309.70
Total 6,297,096.28 3,807,286.87
Other explanation:
Nil
33. Other account payable
In RMB
Item Balance at period-end Balance at period-begin
Other account payable 37,144,872.42 36,508,323.90
Total 37,144,872.42 36,508,323.90
(1) Interest payable
In RMB
Item Balance at period-end Balance at period-begin
Interest overdue without paid:
In RMB
Borrower Amount overdue Overdue cause
Total 0.00 --
Other explanation:
Nil
(2) Dividend payable
In RMB
Item Balance at period-end Balance at period-begin
Other explanation, including dividends payable with over one year age and disclosure un-payment reasons:
Nil
(3) Other account payable
1)Classification of other payable according to nature of account
In RMB
Item Balance at period-end Balance at period-begin
Custodian and common benefit debts 18,853,692.84 18,919,942.85
Intercourse funds 6,500,000.00 6,500,000.00
Warranty and guarantee money 9,767,553.26 9,615,020.00
Other payable service charge (intermediary
801,237.74 707,252.91
services included)
Other 1,222,388.58 766,108.14
Total 37,144,872.42 36,508,323.90
2)Significant other payable with over one year age
In RMB
Item Balance at period-end Reasons of un-paid or carry-over
Custodian and common benefit debts 18,853,692.84
Margin and quality deposit 8,000,000.00 Performance bond
Shenzhen Guosheng Energy Investment
6,500,000.00 Interest-free loans
Development Co., Ltd.
Total 33,353,692.84 --
Other explanation
Top 5 other receivables at period-end
Enterprise Relationship Amount Ratio in total othe
Nature
with the r receivables (%)
company
Custodian and common benefit debts Non-related party 18,853,692.84 50.76 Obligatory right
of common
benefit
Shenzhen Guosheng Energy Investment Related party 6,500,000.00 17.50 Interest-free
Development Co., Ltd. loans
Shenzhen Ruian Information Technology Non-related party 2,500,000.00 6.73 Cash deposit
Enterprise (LP)
Wansheng Industrial Holdings (Shenzhen) Non-related party 2,000,000.00 5.38 Cash deposit
Co., Ltd.
Shenzhen Zhisheng Hi-Tech Enterprise Non-related party 2,000,000.00 5.38 Cash deposit
(LP)
Total 31,853,692.84 85.75
34. Liability held for sale
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
35. Non-current liabilities due within one year
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
36. Other current liabilities
In RMB
Item Balance at period-end Balance at period-begin
Changes of short-term bond payable:
In RMB
Accrual Premium/
Face Release Bond Issuing Opening Issued in interest discount Paid in Ending
Bond
value date period amount balance the Period by face amortizati the Period balance
value on
Total -- -- -- 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Other explanation:
Nil
37. Long-term loans
(1) Classification of long-term loans
In RMB
Item Balance at period-end Balance at period-begin
Explanation:
Nil
Other explanation, including interest rate section:
Nil
38. Bonds payable
(1) Bonds payable
In RMB
Item Balance at period-end Balance at period-begin
(2) Changes of bonds payable (not including the other financial instrument of preferred
stock and perpetual capital securities that classify as financial liability)
In RMB
Total -- -- -- 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(3) Convertible conditions and time for shares transfer for the convertible bonds
Nil
(4) Other financial instruments classify as financial liability
Basic information of the outstanding preferred stock and perpetual capital securities at period-end
Nil
Changes of outstanding preferred stock and perpetual capital securities at period-end
In RMB
Outstanding Period-begin Current period increased Current period decreased Period-end
financial
Amount Book value Amount Book value Amount Book value Amount Book value
instrument
Total 0 0.00 0 0.00 0 0.00 0 0.00
Basis for financial liability classification for other financial instrument
Nil
Other explanation
Nil
39. Long-term account payable
In RMB
Item Balance at period-end Balance at period-begin
(1) Nature of long-term account payable
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
(2) Special payments
In RMB
Balance at Current period Current period Balance at
Item Causes of formation
period-begin increased decreased period-end
Total 0.00 0.00 --
Other explanation:
Nil
40. Long-term wages payable
(1) Long-term wages payable
In RMB
Item Balance at period-end Balance at period-begin
(2) Changes of defined benefit plans
Present value of the defined benefit plans:
In RMB
Item Current Period Last Period
Scheme assets:
In RMB
Item Current Period Last Period
Net liability (assets) of the defined benefit plans
In RMB
Item Current Period Last Period
Content of defined benefit plans and relevant risks, impact on future cash flow of the Company as well as times
and uncertainty:
Nil
Major actuarial assumption and sensitivity analysis:
Nil
Other explanation:
Nil
41. Accrual liability
In RMB
Item Balance at period-end Balance at period-begin Causes of formation
Other explanation, including relevant important assumptions and estimation:
Nil
42. Deferred income
In RMB
Balance at Current period Current period Balance at
Item Causes of formation
period-begin increased decreased period-end
Total 0.00 0.00 --
Item with government grants involved:
In RMB
Amount
Amount Cost Assets-relate
Opening New grants reckoned in Other Ending
Item reckoned in reduction in d/income
balance in the Period non-operatio changes balance
other income the period related
n revenue
Other explanation:
Nil
43. Other non-current liabilities
In RMB
Item Balance at period-end Balance at period-begin
Other explanation:
Nil
44. Share capital
In RMB
Changeduringtheyear(+,-)
Shares
Balance at Balance at
New shares transferred
period-begin Bonus share Other Subtotal period-end
issued from capital
reserve
Total shares 551,347,947.00 551,347,947.00
Other explanation:
Nil
45. Other equity instrument
(1) Basic information of the outstanding preferred stock and perpetual capital securities at
period-end
Nil
(2) Changes of outstanding preferred stock and perpetual capital securities at period-end
In RMB
Outstanding Period-begin Current period increased Current period decreased Period-end
financial
Amount Book value Amount Book value Amount Book value Amount Book value
instrument
Total 0 0 0.00 0 0.00 0
Changes of other equity instrument, change reasons and relevant accounting treatment basis:
Nil
Other explanation:
Nil
46. Capital public reserve
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
Other capital reserve 627,834,297.85 627,834,297.85
1.Debt restructuring
482,580,588.23 482,580,588.23
income
2.Other 145,253,709.62 145,253,709.62
Total 627,834,297.85 627,834,297.85
Other explanation, including changes and reasons for changes:
Among the other capital reserves, 135,840,297.18 Yuan refers to the payment for creditor from
shares assignment by whole shareholders; majority shareholder Guosheng Energy donated
5,390,399.74 Yuan.
47. Treasury stock
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
Total 0.00 0.00
Other explanation, including changes and reasons for changes:
Nil
48. Other comprehensive income
In RMB
Current Period
Less: written in
other Balance
Account comprehensive
Balance at Belong to Belong to at
Item before income in
period-begin Less : income parent minority period-en
previous period
income tax in and carried tax expense company after shareholders
tax after tax d
the year forward to gains
and losses in
current period
Total other comprehensive income 0.00 0.00 0.00
Other explanation, including the active part of the hedging gains/losses of cash flow transfer to initial
recognization adjustment for the arbitraged items:
Nil
49. Reasonable reserve
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
Total 0.00 0.00
Other explanation, including changes and reasons for changes:
Nil
50. Surplus public reserve
In RMB
Item Balance at period-begin Current period increased Current period decreased Balance at period-end
法定 Surplus public
32,673,227.01 32,673,227.01
reserve
Total 32,673,227.01 32,673,227.01
Other explanation, including changes and reasons for changes:
Nil
51. Retained profit
In RMB
Item Current period Last Period
Retained profit at period-end before adjustment -1,195,957,201.01 -1,197,486,788.28
Retained profit at period-begin after adjustment -1,195,957,201.01 -1,197,486,788.28
Add: net profit attributable to shareholders of
-1,591,968.91 1,529,587.27
parent company for this year
Retained profit at period-end -1,197,549,169.92 -1,195,957,201.01
Adjustment for retained profit at period-begin:
1). Retroactive adjustment due to the Accounting Standards for Business Enterprise and relevant new regulations,
retained profit at period-begin has 0.00 Yuan affected;
2) Due to the accounting policy changes, retained profit at period-begin has 0.00 Yuan affected;
3) Due to the major accounting errors correction, retained profit at period-begin has 0.00 Yuan affected;
4) Consolidation range changed due to the same control, retained profit at period-begin has 0.00 Yuan affected;
5) Total other adjustment impacts 0.00 Yuan retained profit at period-begin
52. Operation revenue 和 Operation cost
In RMB
Current Period Last Period
Item
Revenue Cost Revenue Cost
Main business 115,698,679.57 107,318,430.05 134,756,413.50 123,273,702.49
Other business 4,208,270.77 753,000.00 2,734,184.19 753,629.77
Total 119,906,950.34 108,071,430.05 137,490,597.69 124,027,332.26
53. Tax and extras
In RMB
Item Current Period Last Period
Urban maintenance and construction tax 391,013.39 57,572.84
Educational surtax 279,295.29 41,123.44
Stamp tax 54,238.30 95,767.77
Other 3,089.84 2,699.04
Total 727,636.82 197,163.09
Other explanation:
Nil
54. Sales expenses
In RMB
Item Current Period Last Period
Employee compensation 2,954,021.25 2,658,168.80
Market promotion costs 1,052,618.98 1,328,116.44
Business travel expenses 812,392.85 664,419.38
Lease fee 441,316.59 365,319.95
Business entertainment 336,219.12 161,991.56
Other 336,662.62 284,565.08
Total 5,933,231.41 5,462,581.21
Other explanation:
Nil
55. Administrative expenses
In RMB
Item Current Period Last Period
Salary 3,298,560.81 3,766,752.91
Intermediary services charge 1,102,426.83 1,081,232.97
Daily management cost 1,856,424.16 592,685.47
Depreciation and amortization charges 369,874.42 302,594.49
Total 6,627,286.22 5,743,265.84
Other explanation:
Nil
56. R&D expenses
In RMB
Item Current Period Last Period
Other explanation:
Nil
57. Financial expenses
In RMB
Item Current Period Last Period
Interest income -369,745.70 -233,170.32
Exchange loss 0.09
Commission charge etc. 21,061.54 23,600.57
Total -348,684.16 -209,569.66
Other explanation:
Nil
58. Losses of devaluation of asset
In RMB
Item Current Period Last Period
I. Bad debt losses 836,438.10 454,042.30
II. Inventory falling price loss 364,088.31
Total 1,200,526.41 454,042.30
Other explanation:
Nil
59. Other income
In RMB
Income sources Current Period Last Period
60. Investment income
In RMB
Item Current Period Last Period
Other explanation:
Nil
61. Changing income of fair value
In RMB
Changes resources Current Period Last Period
Other explanation:
Nil
62. Assets disposal income
In RMB
Sources of assets disposal income Current Period Last Period
Income from disposal of fixed assets -2,464.81
63. Non-operation revenue
In RMB
Amount reckoned into
Item Current Period Last Period non-recurring gains/losses in
the Year
Other 4,634,304.77 4,629,029.13 4,634,304.77
Total 4,634,304.77 4,629,029.13 4,634,304.77
Government grants reckoned into current gains/losses:
In RMB
Impact Assets
Granting Cause of Special Amount in Amount last
Item Nature current profit related/incom
subject distribution benefit (Y/N) the period period
(Y/N) e related
Other explanation:
1. Non-operation revenue last period mainly due to the rental revenue settle with the custodian, that is
2,866,994.16 Yuan and compensation of 1,086,507.70 Yuan;
Non-operation revenue in current period mainly due to the rental revenue settle with the custodian, that is
3,256,516.11 Yuan and compensation of 1,086,507.70 Yuan;
64. Non-operation expenditure
In RMB
Amount reckoned into
Item Current Period Last Period non-recurring gains/losses in
the Year
Amercement outlay 800.00 0
Damage and scrap loss for
85,730.05 85,730.05
non-current assets
Other 4,373,162.81 4,346,683.24 4,373,162.81
Total 4,458,892.86 4,347,483.24 4,458,892.86
Other explanation:
In the period and last period, the operation assets for assets to be disposed are not allocated by management,
relevant maintenance and management costs are paid by the revenue and loss compensation income from assets
leasing (the assets to be disposed), reckoned into non-operating expenditure
65. Income tax expenses
(1) Income tax expenses
In RMB
Item Current Period Last Period
Current income tax expenses 50,233.75 612,336.68
Deferred income tax expenses -298,792.47 -96,632.42
Total -248,558.72 515,704.26
(2) Adjustment on accounting profit and income tax expenses
In RMB
Item Current Period
Total Profit -2,129,064.50
Income tax measured by statutory/applicable tax rate -532,266.13
Impact on cost, expenses and losses that unable to deducted 80,637.96
Impact on deductible temporary differences or losses deductible
203,069.45
which was un-recognized as deferred income tax assets
Income tax expenses -248,558.72
Other explanation
Nil
66. Other comprehensive income
Found more in Note 48
67. Items of cash flow statement
(1) Other cash received in relation to operation activities
In RMB
Item Current Period Last Period
Interest and Rent and utilities etc. 4,406,556.57 4,994,903.73
Restitution of judicial auction 9,444,737.00
Other intercourse funds 32,000.00 508,907.16
Total 4,438,556.57 14,948,547.89
Explanation on other cash received in relation to operation activities:
Nil
(2) Other cash paid in relation to operation activities
In RMB
Item Current Period Last Period
Expense in management for cash payment 2,496,549.86 7,955,537.16
Rent and property fee and maintenance fee 3,394,536.88 4,122,077.60
Expense in sales for cash payment 2,775,796.71 1,886,340.09
Deposit and Margin paid 285,712.13 219,550.24
Utilities 652,106.63 636,351.99
Non-operation expenditure- compensation 30,140.00
Total 9,634,842.21 14,819,857.08
Explanation on other cash paid in relation to operation activities:
Nil
(3) Cash received from other investment activities
In RMB
Item Current Period Last Period
Explanation on cash received from other investment activities:
Nil
(4) Cash paid related with investment activities
In RMB
Item Current Period Last Period
Explanation on cash paid related with investment activities
Nil
(5) Other cash received in relation to financing activities
In RMB
Item Current Period Last Period
Performance bond for privately placement 8,000,000.00
Bill margin received 8,808,378.06
Total 8,808,378.06 8,000,000.00
Explanation on other cash received in relation to financing activities:
Nil
(6) Cash paid related with financing activities
In RMB
Item Current Period Last Period
Payment of bill margin 2,000,000.00 8,808,378.06
Total 2,000,000.00 8,808,378.06
Explanation on cash paid related with financing activities:
Nil
68. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
Supplementary information Current period Last Period
1． Net profit adjusted to cash flow of
-- --
operation activities:
Net profit -1,880,505.78 1,579,159.47
Add: Assets impairment provision 1,200,526.41 454,042.30
Depreciation of fixed assets, consumption of
oil assets and depreciation of productive 369,874.42 302,594.49
biology assets
Amortization of intangible assets 753,000.00 753,000.00
Loss from disposal of fixed assets, intangible
assets and other long-term assets(gain is 85,730.05 2,464.81
listed with “-”)
Financial expense(gain listed with “-”) 0.09
Decrease of deferred income tax
-298,792.47 -96,632.42
asset( (increase is listed with “-”)
Decrease of inventory (increase is listed with
26,482.38 341,265.63
“-”)
Decrease of operating receivable accounts
-11,299,293.84 -16,740,831.68
(increase is listed with “-”)
Increase of operating payable accounts
1,563,504.67 9,973,358.91
(decrease is listed with “-”)
Net cash flow from operation activities -9,479,474.16 -3,431,578.40
2. Material investment and financing not -- --
involved in cash flow
3. Net change of cash and cash equivalents: -- --
Add: Balance of cash equivalent at
16,488,886.26 19,177,276.18
period-end
Less: Balance of cash equivalent Balance at
19,177,276.18 24,015,287.71
period-begin
Net increased amount of cash and cash
-2,688,389.92 -4,838,011.53
equivalent
(2) Net cash paid for obtaining subsidiary in the Period
In RMB
Amount
Including: --
Including: --
Including: --
Other explanation:
Nil
(3) Net cash received by disposing subsidiary in the Period
In RMB
Amount
Including: --
Including: --
Including: --
Other explanation:
Nil
(4) Constitution of cash and cash equivalent
In RMB
Item Balance at period-end Balance at period-begin
Including: Cash on hand 126,486.63 100,034.87
Bank deposit available for payment at
16,305,989.07 18,837,402.11
any time
Other monetary fund available for
56,410.56 239,839.20
payment at any time
II. Cash equivalent 16,488,886.26 19,177,276.18
Ⅲ. Balance of cash and cash equivalent at
16,488,886.26 19,177,276.18
period-end
Other explanation:
Nil
69. Notes of changes of owners’ equity
Explain the name and adjusted amount in “Other” at end of last period:
Nil
70. Assets with ownership or use right restricted
In RMB
Item Closing book value Restriction reasons
Margin of 2,000,000.00 yuan for bank
Monetary fund 2,000,000.00
acceptance bill
Total 2,000,000.00 --
Other explanation:
Nil
71. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Ending foreign currency
Item Convert rate Ending RMB balance converted
balance
Monetary fund -- --
Including: USD
EURO
HKD
Account receivable -- --
Including: USD
EURO
HKD
Long-term loans -- --
Including: USD
EURO
HKD
Other explanation:
Nil
(2) Explanation on foreign operational entity, including as for the major foreign operational
entity, disclosed main operation place, book-keeping currency and basis for selection; if the
book-keeping currency changed, explain reasons
□ Applicable √ Not applicable
72. Hedging
Disclosed hedging items and relevant hedging instrument based on hedging’s category, disclosed qualitative and
quantitative information for the arbitrage risks:
Nil
73. Government grants
(1) Government grants
In RMB
Amount booked in current
Category Amount Item
gain/loss
(2) Government grants rebate
□ Applicable √ Not applicable
Other explanation:
Nil
74. Other
Nil
VIII. Changes of consolidation range
1. Enterprise combined under different control
(1) Enterprise combined under different control in the Period
In RMB
Income of Net profit of
Standard to
Time point Cost of Ratio of Acquired acquiree from acquiree from
Purchasing determine the
Acquiree for equity equity equity way Equity purchasing purchasing
date purchasing
obtained obtained obtained obtained way date to date to
date
period-end period-end
Other explanation:
(2) Combination cost and goodwill
In RMB
Combination cost
Determination method for fair value of the combination cost and contingent consideration and changes:
Nil
Main reasons for large goodwill resulted:
Nil
Other explanation:
Nil
(3) Identifiable assets and liability on purchasing date under the acquiree
In RMB
Fair value on purchasing date Book value on purchasing date
Determination method for fair value of the identifiable assets and liabilities:
Nil
Contingent liability of the acquiree bear during combination:
Nil
Other explanation:
Nil
(4) Gains or losses arising from re-measured by fair value for the equity held before
purchasing date
Whether it is a business combination realized by two or more transactions of exchange and a transaction of
obtained control rights in the Period or not
□Yes √No
(5) On purchasing date or period-end of the combination, combination consideration or fair
value of identifiable assets and liability for the acquiree are un-able to confirm rationally
Nil
(6) Other explanation
Nil
2. Enterprise combine under the same control
(1) Enterprise combined under the same control in the Period
In RMB
Income of the Net profit of
combined the combined
Income of the Net profit of
party from party from
Basis of Standard to combined the combined
Equity ratio period-begin period-begin
combined Combination determine the party during party during
Acquiree obtained in of of
under the date combination the the
combination combination combination
same control date comparison comparison
to the to the
period period
combination combination
date date
Other explanation:
Nil
(2) Combination cost
In RMB
Combination cost
Explanation on contingent consideration and its changes:
Nil
Other explanation:
Nil
(3) Assets and liability of the combined party on combination date
In RMB
On purchasing date At end of last period
Contingent liability of the combined party bear during combination:
Nil
Other explanation:
Nil
3. Counter purchase
Basic transaction information, basis of counter purchase, whether making up business due to the assets and
liability reserved by listed company and basis, determination of combination cost, amount and calculation on
adjusted equity by equity transaction
Nil
4. Subsidiary disposal
Whether lost controlling rights while dispose subsidiary on one time or not
□ Yes √ No
Whether lost controlling rights in the Period while dispose subsidiary on two or more steps or not
□ Yes √ No
5. Other reasons for consolidation range changed
Reasons for changed on consolidation range (such as new subsidiary established, subsidiary liquidated etc.)And
relevant information
Nil
6. Other
Nil
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Main operation Share-holding ratio
Subsidiary Registered place Business nature Acquired way
place Directly Indirectly
Shenzhen
Sales of bicycles
Emmelle Industry Shenzhen Shenzhen 70.00% Investment
and spare parts
Co., Ltd.
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
Nil
Basis for controlling the invested entity with half or below voting rights held and without controlling invested
entity but with over half and over voting rights
Nil
Controlling basis for the structuring entity included in consolidated range
Nil
Basis on determining to be an agent or consignor:
Nil
Other explanation:
Nil
(2)Important non-wholly-owned subsidiary
In RMB
Dividend announced to
Share-holding ratio of Gains/losses attributable Ending equity of
Subsidiary distribute for minority in
minority to minority in the Period minority
the Period
Shenzhen Emmelle
30.00% -288,536.87 2,674,162.80
Industry Co., Ltd.
Explanation on share-holding ratio of minority different from ratio of voting right:
Nil
Other explanation:
Nil
(3) Main finance of the important non-wholly-owned subsidiary
In RMB
Balance at period-end Balance at period-begin
Subsidia Non-curr Non-curr Non-curr Non-curr
Current Total Current Total Current Total Current Total
ry ent ent ent ent
assets assets liability liabilities assets assets liability liabilities
assets liability assets liability
Shenzhe
n
29,791,5 1,548,02 31,339,5 22,425,6 22,425,6 31,672,2 1,373,48 33,045,7 23,170,0 23,170,0
Emmelle 0.00 0.00
25.49 1.02 46.51 70.50 70.50 52.96 1.42 34.38 68.81 68.81
Industry
Co., Ltd.
In RMB
Current Period Last Period
Total Cash flow Total Cash flow
Subsidiary Operation Operation
Net profit comprehensi from Net profit comprehensi from
revenue revenue
ve income operation ve income operation
activity activity
Shenzhen
Emmelle 88,175,813.9 116,393,660.
-961,789.56 -961,789.56 -2,982,485.91 165,240.67 165,240.67 -9,704,911.00
Industry Co., 0 87
Ltd.
Other explanation:
Nil
(4) Major restriction on using corporate assets and liquidate corporate debts
Nil
(5) Financial or other supporting provided to structuring entity that included in
consolidated financial statement
Nil
Other explanation:
Nil
2. Transaction that has owners equity shares changed in subsidiary but still with controlling
rights
(1) Owners equity shares changed in subsidiary
Nil
(2) Impact on minority’s interest and owners’ equity attributable to parent company
In RMB
Other explanation
Nil
3. Equity in joint venture and cooperative enterprise
(1) Important joint venture and cooperative enterprise
Share-holding ratio Accounting
treatment on
Main operation investment for
Name Registered place Business nature
place Directly Indirectly joint venture and
cooperative
enterprise
Share-holding ratio or shares enjoyed different from voting right ratio:
Nil
Basis of the voting rights with 20% below but with major influence, or without major influence but with over 20%
(20% included) voting rights hold:
Nil
(2) Main financial information of the important joint venture
In RMB
Balance at period-end/Current Period Balance at period-begin/Last Period
Other explanation
Nil
(3) Main financial information of the important cooperative enterprise
In RMB
Balance at period-end/Current Period Balance at period-begin/Last Period
Other explanation
Nil
(4) Financial summary for un-important joint venture or cooperative enterprise
In RMB
Balance at period-end/Current Period Balance at period-begin/Last Period
Joint venture： -- --
Total numbers measured by share-holding
-- --
ratio
Cooperative enterprise -- --
Total numbers measured by share-holding
-- --
ratio
Other explanation
Nil
(5)Assets transfer ability has major restriction from joint venture or cooperative enterprise
Nil
(6) Excess losses from joint venture or cooperative enterprise
In RMB
Un-confirmed losses not
Cumulative un-confirmed Cumulative un-confirmed
Name recognized in the Period (or net
losses losses at period-end
profit enjoyed in the Period)
Other explanation
Nil
(7) Un-confirmed commitment with investment concerned with joint venture
Nil
(8) Contingent liability with investment concerned with joint venture or cooperative
enterprise
Nil
4. Co-runs operation
Share-holding ratio/ share enjoyed
Name Main operation place Registered place Business nature
Directly Indirectly
Share-holding ratio or shares enjoyed different from voting right ratio:
Nil
If the co-runs entity is the separate entity, basis of the co-runs classification
Nil
Other explanation
Nil
5. Equity in structuring entity that excluding in the consolidated financial statement
Relevant explanation
Nil
6. Other
Nil
X. Risk related with financial instrument
The major financial instruments of the Company consist of monetary fund, account receivable,
other account receivable, account payable and other account payable, etc. details of these financial
instruments are disclosed in the relevant notes. Risks relating to these financial instruments and
risk management policies adopted by the Company to minimize these risks are detailed as follows.
Management of the Company manages and monitors the risk exposures, to make sure they are
under control.
1. Risk management targets and policies
The objectives of the Company’s risk management is to balance the risk and income, reduce the
negative risk impact of operating performance to the lowest level, maximize the interests of
shareholders and other equity investors. Based on these objectives, the Company has established
risk management policies to identify and analyze the risks faced by the Company, set adequate
risk acceptable level and designed relevant internal control system to monitor the level of risks.
The Company regularly reviews these policies and related internal control system to adapt to
market development and change of operating activities of the Company. The major risks arising
from the Company’s financial instruments are credit risk and liquidity risk.
(1)Credit risk
Credit risk represents the risk of financial loss suffered by a party to a financial instrument due to
failure of performance obligation of another party.
Credit risk of the Company is managed by category. Credit risk mainly arises from bank deposits
and trade receivables. Since the bank deposits of the Company are mainly placed with those banks
of high credit rating, the Company expects no significant credit risk on bank deposits.
As for trade receivables, the Company establishes relevant policies to control credit risk exposure.
The Company, based on financial position of debtors, their credit records, market conditions and
other factors, makes assessment on debtors’ credit quality and sets relevant limit on amount of
debt and credit term. The maximum credit risk exposure assumed by the Company equals to the
sum of carrying value of every financial asset in the balance sheet. The Company provides no
guarantee that may lead it to be exposed to credit risks.
(2)Liquidity risk
Liquidity risk refers to the risk of capital shortage of the Company when performing settlement
obligation via delivery of cash or other financial assets.
When managing liquidity risk, the Company maintains and monitors such cash and cash
equivalents as deemed adequate by the management, so as to satisfy its operation needs and
minimize influence of fluctuation of cash flow. Management of the Company monitors application
of bank borrowings to make sure it complies with relevant borrowing agreements.
2. Capital management
The capital management policy of the Company is designed to ensure sustainable operation Of the
Company so as to bring shareholders return and benefit other stakeholders, and to minimize
capital cost by maintaining optimal capital structure.
In order to maintain and adjust capital structure, the Company may adjust share dividend paid to
shareholders or issue new shares.
The Company monitors capital structure based on gearing ratio (total liabilities divided by total
assets). As at 31 December 2018, the gearing ratio of the Company was 76.82% (31 December
2017: 74.36%)
XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB
Ending fair value
Item
First-order Second-order Third-order Total
I. Sustaining measured by
-- -- -- --
fair value
II. Non-sustaining
-- -- -- --
measured by fair value
2.Recognized basis for the market price sustaining and non-persistent measured by fair
value on first-order
Nil
3. Valuation technique and qualitative and quantitative information on major parameters
for the fair value measure sustaining and non-persistent on second-order
Nil
4. Valuation technique and qualitative and quantitative information on major parameters
for the fair value measure sustaining and non-persistent on third-order
Nil
5.Adjustment information and sensitivity analysis of unobservable parameters for the fair
value measure sustaining and non-persistent on third-order
Nil
6. Sustaining items measured by fair value, as for the conversion between at all levels,
reasons for conversion and policy for conversion time point
Nil
7. Changes of valuation technique in the Period
Nil
8. Financial assets and liability not measured by fair value
Nil
9. Other
Nil
XII. Related party and related transactions
1. Parent company of the enterprise
Share-holding ratio
Voting right ratio on
Parent company Registration place Business nature Registered capital on the enterprise for
the enterprise
parent company
Explanation on parent company of the enterprise
The Company has no parent company so far
Ultimate controller of the Company: nil
Other explanation:
Controlling shareholder and actual controller of the Company have changed on 20 February 2017. Before changed,
the first majority shareholder of the Company was Shenzhen Guosheng Energy Investment Development Co., Ltd.,
actual controller was Mr. Ji Hanfei; the Company has no actual controller and controlling shareholder after
changed. Found more in the Annual Report 2016 released on 27 April 2017 and “Reply on Surveillance Attention
Letter on CBC from Shenzhen Stock Exchange” released on 26 May 2017
2. Subsidiary of the Enterprise
Found more in Note IX-1
3. Cooperative enterprise and joint venture
Found more in Note IX-3
Other cooperative enterprise and joint venture that have related transaction with the Company in the Period or
occurred in pervious period
Name Relationship
Other explanation
Nil
4. Other related party
Other related party Relationship with the Enterprise
Supervisor of the Company Li Jialin is the legal person of the
Shenzhen Huahui Tongda Industrial Co., Ltd.
enterprise
Shenzhen Guosheng Energy Investment Development Co., Ltd. The first majority shareholder
Other explanation
11.52 percent shares of the Company are held by Shenzhen Guosheng Energy Investment Development Co., Ltd.
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
Transaction Approved transaction Whether more than
Related party Current Period Last amount
content amount the transaction amount
Goods sold/labor service providing
In RMB
Related party Transaction content Current Period Last Period
Shenzhen Huahui Tongda
Sales of goods 234,790.09 0.00
Industrial Co., Ltd.
Explanation on goods purchasing, labor service providing and receiving
Nil
(2) Related trusteeship/contract and delegated administration/outsourcing
Trusteeship/contract
In RMB
Income from
Client/ Entrusting party/ Yield pricing
Assets type Starting date Maturity date trusteeship/contra
contract-out party contractor basis
ct
Explanation on related trusteeship/contract
Nil
Delegated administration/outsourcing
In RMB
Pricing basis of trustee
Client/ Entrusting party/ trustee fee/outsourcing
Assets type Starting date Maturity date
contract-out party contractor fee/outsourcing fee recognized in
fee the Period
Explanation on related administration/outsourcing
Nil
(3) Related lease
As a lessor for the Company:
In RMB
Lease income in recognized in Lease income in recognized last
Lessee Assets type
the Period the Period
As a lessee for the Company:
In RMB
Lease income in recognized in Lease income in recognized last
Lessor Assets type
the Period the Period
Explanation on related lease
Nil
(4) Related guarantee
As a guarantor for the Company
In RMB
Guarantee completed
Secured party Amount guarantee Starting date Maturity date
(Y/N)
As a secured party for the Company
In RMB
Guarantee completed
Guarantor Amount guarantee Starting date Maturity date
(Y/N)
Explanation on related guarantee
(5) Borrowed funds of related party
In RMB
Related party Borrowed funds Starting date Maturity date Note
Borrowing
Lending
(6) Assets transfer and debt restructuring of related party
In RMB
Related party Transaction content Current Period Last Period
(7) Remuneration of key manager
In RMB
Item Current Period Last Period
Remuneration of key manager 1,950,178.00 1,880,143.00
(8) Other related transactions
Nil
6. Receivable/payable items of related parties
(1) Receivable item
In RMB
Balance at period-end Balance at period-begin
Item Related party
Book balance Bad debts provision Book balance Bad debts provision
(2) Payable item
In RMB
Item Related party Ending book balance Opening book balance
Shenzhen Huahui Tongda
Account received in advance 5,439.00 0.00
Industrial Co., Ltd.
Shenzhen Guosheng Energy
Other account payable Investment Development Co., 6,500,000.00 6,500,000.00
Ltd.
7. Commitments of related party
Nil
8. Other
Nil
XIII. Share-based payment
1. General share-based payment
□ Applicable √ Not applicable
2. Share-based payment settled by equity
□ Applicable √ Not applicable
3. Share-based payment settled by cash
□ Applicable √ Not applicable
4. Revised and termination on share-based payment
Nil
5. Other
Nil
XIV. Commitment or contingency
1. Important commitments
Important commitments in balance sheet date
Nil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained
reasons
The Company has no important contingency that need to disclosed
3. Other
Nil
XV. Events after balance sheet date
1. Important non-adjustment items
In RMB
Impact on financial status and Reasons on un-able to estimated
Item Content
operation results the impact number
2. Profit distribution
In RMB
3. Sales return
Nil
4. Other events after balance sheet date
Nil
XVI. Other important events
1. Previous accounting errors collection
(1) Retrospective restatement
In RMB
Impact items of statement
Correction content Treatment procedures Cumulative impacted number
during a comparison
(2) Prospective application
Reasons for prospective application
Correction content Approval procedures
adopted
2. Debt restructuring
Nil
3. Assets replacement
(1) Non-monetary assets change
Nil
(2) Other assets replacement
Nil
4. Pension plan
Nil
5. Discontinued operations
In RMB
Discontinued
operations profit
Income tax
Item Revenue Expenses Total Profit Net profit attributable to
expenses
owners of parent
company
Other explanation
Nil
6. Segment
(1) Recognition basis and accounting policy for reportable segment
Nil
(2) Financial information for reportable segment
In RMB
Item Offset between segments Total
(3)The Company has no reportable segments, or unable to disclose total assts and total
liability for reportable segments, explain reasons
Nil
(4) Other explanation
Nil
7. Major transaction and events makes influence on investor’s decision
Nil
8. Other
XVII. Principle notes of financial statements of parent company
1. Note receivable and account receivable
In RMB
Item Balance at period-end Balance at period-begin
Note receivable 300,000.00
Account receivable 12,827,954.16 17,680,663.16
Total 12,827,954.16 17,980,663.16
(1) Note receivable
1)Classification
In RMB
Item Balance at period-end Balance at period-begin
Bank acceptance 300,000.00
Total 300,000.00
2)Notes receivable already pledged by the Company at the end of the period
In RMB
Item Amount pledge at period-end
Total 0.00
3)Notes endorsement or discount and undue on balance sheet date
In RMB
Item Amount derecognition at period-end Amount not derecognition at period-end
Bank acceptance 15,498,304.72
Total 15,498,304.72
4)Notes transfer to account receivable due for failure implementation by drawer at
period-end
In RMB
Item Amount transfer to receivable at period-end
Total 0.00
Other explanation
Nil
(2) Account receivable
1)Category of account receivable
In RMB
Balance at period-end Balance at period-begin
Book balance Bad debts provision Book balance Bad debts provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Account receivable
withdrawal bad debt
12,866,5 38,599.6 12,827,95 17,733, 17,680,663.
provision by group of 100.00% 0.30% 100.00% 53,201.59 0.30%
53.82 6 4.16 864.75 16
credit risk
characteristics
12,866,5 38,599.6 12,827,95 17,733, 17,680,663.
Total 100.00% 0.30% 100.00% 53,201.59 0.30%
53.82 6 4.16 864.75 16
Receivable with single significant amount and withdrawal bad debt provision separately at end of period:
□ Applicable √ Not applicable
In combination, accounts receivable whose bad debts provision was accrued by age analysis:
√ Applicable □ Not applicable
In RMB
Balance at period-end
Account age
Account receivable Bad debts provision Accrual ratio
Within one year
Within one year(one year
12,866,553.82 38,599.66 0.30%
included)
Subtotal within one year 12,866,553.82 38,599.66 0.30%
Total 12,866,553.82 38,599.66 0.30%
Explanations on combination determine:
Nil
In combination, withdrawal proportion of bad debt provision based on balance proportion for account receivable:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for account receivable:
Nil
2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was -14,601.93 Yuan; the amount collected or switches back amounting to 0.00 Yuan.
Important bad debt provision collected or switch back:
In RMB
Enterprise Collected or switch back amount Collection way
Total 0.00 --
Nil
3)Account receivable actual charge off in the Period
In RMB
Item Amount written off
Written-off for the major receivable:
In RMB
Nature of account Verification Arising from related
Enterprise Amount written off Reason for write-off
receivable procedures transaction (Y/N)
Total -- 0.00 -- -- --
Explanation for write-off of receivables:
Nil
4)Top 5 receivables at ending balance by arrears party
Enterprise Relationship Amount Account Bad debts Ratio in total Nature
with the age provision receivables (%)
company
Shenzhen Boyineng Technology Co., Non-related 5,772,755.17 Within one 17,318.27 44.86 Paymen
Ltd. party year t for
goods
Shenzhen Weiterui New Energy Non-related 4,056,480.65 Within one 12,169.44 31.53 Paymen
Technology Co., Ltd. party year t for
goods
Guangdong Xinlingjia New Energy Non-related 1,953,000.00 Within one 5,859.00 15.18 Paymen
Co., Ltd. party year t for
goods
Shenzhen Jiahaosong Technology Co., Non-related 1,084,318.00 Within one 3,252.95 8.43 Paymen
Ltd. party year t for
goods
Total 12,866,553.82 38,599.66 100.00
5)Receivable derecognition due to transfer of financial assets
Nil
6)Assets and liability resulted by receivable transfer and continuous involvement
Nil
Other explanation:
Nil
2. Other account receivable
In RMB
Item Balance at period-end Balance at period-begin
Other account receivable 380,925.78 280,576.37
Total 380,925.78 280,576.37
(1) Interest receivable
1)Category of interest receivable
In RMB
Item Balance at period-end Balance at period-begin
2)2)Major overdue interest
In RMB
Whether the impairment
Borrower Balance at period-end Overdue time Overdue cause occurs and its judgment
basis
Total 0.00 -- -- --
Other explanation:
Nil
(2) Dividend receivable
1)Dividend receivable
In RMB
Item(或 The invested enterprise) Balance at period-end Balance at period-begin
2)Important dividends payable with account age over one year
In RMB
Whether the impairment
Item( or The invested
Balance at period-end Account age Un-recovered reasons occurs and its judgment
enterprise)
basis
Total 0.00 -- -- --
Other explanation:
Nil
(3) Other account receivable
1)Other accounts receivable by category
In RMB
Balance at period-end Balance at period-begin
Book balance Bad debts provision Book balance Bad debts provision
Category Book
Accrual Accrual Book value
Amount Ratio Amount value Amount Ratio Amount
ratio ratio
Other receivables
with bad debt 382,072. 380,925.7 251,350
100.00% 1,146.22 0.30% 89.34% 754.05 0.30% 250,595.95
provision accrual by 00 8 .00
credit portfolio
Other account
receivable with
individual minor
29,980.
amount but 10.66% 29,980.42
42
withdrawal bad debt
provision
independently
382,072. 380,925.7 281,330
Total 100.00% 1,146.22 0.30% 100.00% 754.05 0.27% 280,576.37
00 8 .42
Other receivable with single significant amount and withdrawal bad debt provision separately at end of period
□ Applicable √ Not applicable
In combination, other accounts receivable whose bad debts provision was accrued by age analysis
√ Applicable □ Not applicable
In RMB
Balance at period-end
Account age
Other account receivable Bad debts provision Accrual ratio
Within one year
Within one year(one year
370,172.00 1,110.52 0.30%
included)
Subtotal within one year 370,172.00 1,110.52 0.30%
1-2 years 200.00 0.60 0.30%
2-3 years 11,700.00 35.10 0.30%
Total 382,072.00 1,146.22 0.30%
Explanations on combination determine:
Nil
In combination, withdrawal proportion of bad debt provision based on balance proportion for other account
receivable:
□ Applicable √ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for other account receivable:
□ Applicable √ Not applicable
2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was 392.17 Yuan; the amount collected or switches back amounting to 0.00 Yuan.
Important bad debt provision collected or switch back:
In RMB
Enterprise Amount reversal or collected Collection way
Total 0.00 --
Nil
3) Other receivables actually written-off during the reporting period
In RMB
Item Amount written off
Written-off for the major other receivable:
In RMB
Nature of other Verification Arising from related
Enterprise Amount written off Reason for write-off
receivables procedures transaction (Y/N)
Total -- 0.00 -- -- --
Explanation for write-off of other receivables:
Nil
4)Other receivables by nature
In RMB
Nature Ending book balance Opening book balance
Intercourse funds 29,980.42
Deposit or margin 370,672.00 239,950.00
Equipment fund 11,400.00 11,400.00
Total 382,072.00 281,330.42
5)Top 5 other receivables at ending balance by arrears party
In RMB
Ratio in total ending
Balance at Ending balance of
Enterprise Nature Account age balance of other
period-end bad bet provision
receivables
Shenzhen Material
Deposit or margin 181,918.00 Within one year 47.61% 545.75
Group Co., Ltd.
Shenzhen Anjingheng
Deposit or margin 161,000.00 Within one year 42.14% 483.00
Industrial Co., Ltd.
Shenzhen Jintaiyuan
Investment Deposit or margin 27,254.00 Within one year 7.13% 81.76
Management Co., Ltd.
Shenzhen Hongkang
Instrument Equipment fund 11,400.00 2-3 years 2.98% 34.20
Technology Co., Ltd.
Lianxin Jiayuan
Branch of Shenzhen
Deposit and margin 300.00 2-3 years 0.08% 0.90
Color Life Property
Management Co., Ltd.
Total -- 381,872.00 -- 99.94% 1,145.61
6)Account receivable with government grants involved
In RMB
Time, amount and basis
Enterprise Government grants Balance at period-end Ending account age of amount collection
estimated
Nil
7)Other account receivable derecognition due to financial assets transfer
Nil
8)Assets and liability resulted by other account receivable transfer and continuous involvement
Nil
Other explanation:
Nil
3. Long-term equity investment
In RMB
Balance at period-end Balance at period-begin
Item
Book balance Impairment Book value Book balance Impairment Book value
Investment for
1,400,000.00 1,389,620.27 10,379.73 1,400,000.00 1,389,620.27 10,379.73
subsidiary
Total 1,400,000.00 1,389,620.27 10,379.73 1,400,000.00 1,389,620.27 10,379.73
(1) Investment for subsidiary
In RMB
Current Ending balance of
The invested Balance at Current period Current period Balance at
impairment impairment
enterprise period-begin increased decreased period-end
accrual provision
Shenzhen
Emmelle Industry 1,400,000.00 1,400,000.00 1,389,620.27
Co., Ltd.
Total 1,400,000.00 0.00 0.00 1,400,000.00 0.00 1,389,620.27
(2) Investment for associates and joint venture
In RMB
Current period changes +,-
Ending
Other Cash
Balance Investme Balance balance
Additiona comprehe dividend
Funded at nt gains Other at of
l Capital nsive or profit Impairme
enterprise period-be recognize equity Other period-en impairme
investmen reduction income announce nt accrual
gin d under change d nt
t adjustmen d to
equity provision
t issued
I. Joint venture
Subtotal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
II. Affiliated enterprise
Subtotal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
(3) Other explanation
Nil
4. Operation revenue and operation cost
In RMB
Current Period Last Period
Item
Revenue Cost Revenue Cost
Main business 31,732,088.16 29,103,342.44 22,338,842.47 19,253,017.11
Other business 2,127,375.25 753,000.00 2,166,747.83 759,358.98
Total 33,859,463.41 29,856,342.44 24,505,590.30 20,012,376.09
Other explanation:
Nil
5. Investment income
In RMB
Item Current Period Last Period
6. Other
Nil
XVIII. Supplementary Information
1. Current non-recurring gains/losses
√ Applicable □ Not applicable
In RMB
Item Amount Note
Gains/losses from the disposal of
-85,730.05
non-current asset
Switch-back of the impairment for
receivables which have impairment test 219,118.00
independently
Other non-operating income and expenditure
261,141.96
except for the aforementioned items
Less: Impact on income tax 98,632.48
Impact on minority shareholders’ equity 49,951.88
Total 245,945.55 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for
Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring
profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on
Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, explain
reasons
□ Applicable √ Not applicable
2. 净资产收益率及每股收益
Earnings per share
Profits during report period Weighted average ROE Basic earnings per Diluted earnings per
share(RMB/Share) share(RMB/Share)
Net profits belong to common stock
-10.54% -0.0029 -0.0029
stockholders of the Company
Net profits belong to common stock
stockholders of the Company after
-12.17% -0.0033 -0.0033
deducting nonrecurring gains and
losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS
(International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting
Principles)
□ Applicable √ Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both
foreign accounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
(3) Explain accounting difference over the accounting rules in and out of China; as for the
difference adjustment for data audited by foreign auditing organ, noted the name of such
foreign organ
Nil
4. Other
Nil
