深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Shenzhen China Bicycle Company (Holdings) Limited SEMI-ANNUAL REPORT 2019 August 2019 1 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section I. Important Notice, Contents and Paraphrase Board of Directors, Supervisory Committee, all directors, supervisors and senior executives of Shenzhen China Bicycle Company (Holdings) Limited (hereinafter referred to as the Company) hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents. Li Hai, Principal of the Company, Sun Longlong, person in charge of accounting works and Zhong Xiaojin, person in charge of accounting organ (accounting principal) hereby confirm that the Financial Report of 2019 Semi-Annual Report is authentic, accurate and complete. All directors are attended the Board Meeting for report deliberation. The Company has no plan of cash bonus, dividends and capitalizing of reserves either. 2 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Content Section I Important Notice and Paraphrase ............................................................. 2 Section II Company Profile and Main Financial Indexes ....................................... 5 Section III Summary of Company Business ............................................................. 8 Section IV Discussion and Analysis of the Operation .............................................. 9 Section V Important Events ..................................................................................... 16 Section VI Changes in shares and shareholders ..................................................... 23 Section VII Preferred Stock ...................................................................................... 28 Section VIII Particulars about Directors, Supervisors and Senior Executives ... 29 Section IX Corporate -bond ..................................................................................... 30 Section X Financial report ........................................................................................ 31 Section XI Documents available for reference...................................................... 157 3 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Paraphrase Items Refers to Definition 4 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section II. Company Profile and Main Financial Indexes I. Company Profile Short form of the stock Zhonghua – A, Zhonghua -B Code for share 000017, 200017 The abbreviation of the N/A changed stock (if applicable) Stock exchange for listing Shenzhen Stock Exchange Name of the Company (in 深圳中华自行车(集团)股份有限公司 Chinese) Short form of the Company 深中华 (in Chinese) (if applicable) Foreign name of the Company Shenzhen China Bicycle Company (Holdings) Limited (if applicable) Short form of foreign name of CBC the Company (if applicable) Legal representative Li Hai II. Contact person and ways Secretary of the Board Rep. of securities affairs Name Sun Longlong Cui Hongxia, Zhong Xiaojin Room 1201, Wantong Building, No.3002, Room 1201, Wantong Building, No.3002, Contact adds. Sungang East Road, Luohu District, Sungang East Road, Luohu District, Shenzhen Shenzhen Tel. 0755-25516998,28181666 0755-25516998,28181666 Fax. 0755-28181009 0755-28181009 E-mail dmc@szcbc.com dmc@szcbc.com III. Others 1. Way of contact Whether registrations address, offices address and codes as well as website and email of the Company changed in reporting period or not □ Applicable √ Not applicable Registrations address, offices address and codes as well as website and email of the Company has no change in reporting period, found more details in Annual Report 2018. 5 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 2. Information disclosure and preparation place Whether information disclosure and preparation place changed in reporting period or not □ Applicable √ Not applicable The newspaper appointed for information disclosure, website for semi-annual report publish appointed by CSRC and preparation place for semi-annual report have no change in reporting period, found more details in Annual Report 2018. IV. Main accounting data and financial indexes Whether it has retroactive adjustment or re-statement on previous accounting data or not □ Yes √ No Increase/decrease in this Current period Same period of last year report y-o-y Operating revenue (RMB) 38,274,433.02 67,734,899.35 -43.49% Net profit attributable to shareholders of -798,946.17 554,162.06 -244.17% the listed company (RMB) Net profit attributable to shareholders of the listed company after deducting -910,390.17 521,366.39 -274.62% non-recurring gains and losses (RMB) Net cash flow arising from operating -8,901,256.74 -3,362,971.19 164.68% activities (RMB) Basic earnings per share (RMB/Share) -0.0014 0.0010 -240.00% Diluted earnings per share (RMB/Share) -0.0014 0.0010 -240.00% Weighted average ROE -5.74% 3.43% -9.17% Increase/decrease in this End of current period End of last period report-end over that of last period-end Total assets (RMB) 64,830,640.85 73,242,960.17 -11.49% Net assets attributable to shareholder of 13,507,355.77 14,306,301.94 -5.58% listed company (RMB) V. 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 The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period. 6 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or Chinese GAAP (Generally Accepted Accounting Principles) in the period. VI. Items and amounts of extraordinary profit (gains)/loss √Applicable □ Not applicable In RMB Item Amount Note Other non-operating income and expenditure except for the 148,577.00 aforementioned items Less: impact on income tax 37,144.25 Impact on minority shareholders’ equity (post-tax) -11.25 Total 111,444.00 -- 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 In reporting period, the Company has no particular about 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 7 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section III. Summary of Company Business I. Main businesses of the Company in the reporting period Does the Company need to comply with the disclosure requirement of the special industry No The company is engaged in the main business for the bicycle business and lithium battery material business, including production, assembly, procurement, sales of bicycles and electric bicycles, etc. II. Major changes in main assets 1. Major changes in main assets Major assets Note of major changes 2. Main overseas assets □ Applicable √ Not applicable III. Core Competitiveness Analysis Does the Company need to comply with the disclosure requirements of the special industry No Despite the fierce market competition in the bicycle industry as a conventional industry, the increased awareness of green commuting, leisure and exercises as a result of the development of China’s social economy and the change of people’s living concept creates structural development opportunity for the bicycle industry. The Company will continue to do better in various aspects of operation such as market development, product development, quality management and sales of e-commerce, extended and expansion the application of upstream & downstream industry for the industrial chain step by step, so as to maintain and improve the Company’s ability to continue as a going concern before the restructuring. On the other side, the Company has set out the condition of introduction of investors in the restructuring plan with expectation to restore its ability to continue as a going concern and its continuous profitability through the restructuring of assets. Furthermore, we strive to planning the privately placement in the period and hope to improve the operation ability and development strength of the Company. The specific works are underway. 8 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section IV. Discussion and Analysis of the Business I. Introduction In 2019, the international political and economic situation was complex and severe, the problem of unbalanced and inadequate domestic development remains a serious one, new downward pressure has emerged in the economy. Under the leadership of central government and governments at all levels, the whole nation strengthened their confidence, overcame difficulties, and forged ahead, and achieved steady progress in economic and social development, and the economic fundamentals were continuously consolidated and developed. As a sector in the traditional manufacturing field, the bicycle industry continued the dilemma of rise in labor cost, manufacturing costs, cost of capital, and material costs. In 2018, the relevant state ministry issued a new national standard for electric bicycle safety technical specifications which was implemented on April 15, 2019. Implementation of the new national standard, has accelerated the industry’s reshuffle industry shocks. In addition, in the past two years, the bike sharing has been violently oscillating the bicycle industry and the upstream supply chain operations with capital advantages, due to the lack of profit model and capital chain problems, and it continued to have a big impact on the whole industry in 2019. At the same time, as a traditional manufacturing industry, the bicycle industry also ushered in the “Made in China 2025” strategy, under the guidance of the basic principles of “Innovation Driven, Quality First, Green Development, Structure Optimization, and Talent Based”, took the important opportunity to speed up the transformation and upgrading, ushered in the development opportunity of the implementation of the new national standards for electric bicycles, and also faced with the important challenges of e-commerce development impacts on channels, channel integration and Internet+. China has the world’s largest production and marketing of electric bicycles, after years of development, electric bicycles have gradually become an important means of transportation for consumers on everyday short-distance trips, at present, there are about 200 million bicycles in the entire society. Structural body, motor, power battery, and control system are the core components of electric bicycles, Shenzhen China Bicycle has been closely following up the research on their technological development, application development, and commercial value for a long period of time, and has determined the qualified suppliers for core components year by year. The non-public offering of shares for fund-raising investment project of Shenzhen China Bicycle being planned and prepared at present also covers the application researches on switched reluctance motors, super-capacitor batteries, new materials, electric car bus control systems, wearable devices, intelligent positioning lock systems, etc. As one of the core components, electric bicycle power batteries have been mainly lead-acid batteries in the past decade or two, with the development and popularization of new energy technologies and new energy materials, it is expected to be replaced by the lithium batteries in the future. According to the strategy guidelines of “Made in China 2025” by the State Council and the spirit of standardization reform, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Industry and Commerce, and the General Administration of Quality Supervision, Inspection and Quarantine have introduced a new national standard for electric bicycles to comprehensively improve the safety performance of electric bicycles, adjust and 9 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 improve the speed limit, vehicle quality, pedaling and riding ability and other technical indicators. New standards not only are close to people’s livelihood, but also improve the application space for lithium battery energy storage, and lithium battery electric bicycles usher in a new stage of development. In this context, in 2019, due to the actual situation of having a weak economic foundation after reforming, on the one hand, the company adhered to taking the development of traditional business model as the principle, combined with the new national standard of electric bicycle safety technical specifications, carried out research and development on new products, optimized and adjusted product structure and sales model transformation, actively expanded the e-commerce business model and realized the steady development operation of the e-commerce retail business according to the e-commerce transformation of business team and the cost controllable mode of external contact and cooperation and internal guidance; on the one hand, correspondingly carried out the tracking study on industrial projects and technology applications of upstream and downstream of industrial chain in the long-term process of electric bicycle business, started getting involved in the lithium battery materials business based on the extensive business consultation and business opportunity sifting, taking one step to expanding the business of Lithium battery materials and rich the main business; on the other hand, strive to promote the selection work of the company's restructuring, planned the non-public offering of shares, and started the business upgrades and connection work of the offline sales platform for sports experience and R & D center construction projects. In preparation for non-public offering of shares, in July 2016, the company initiated the planning and preparation for non-public offering of shares and engaged securities companies, lawyers, accountants, and other intermediary agencies to carry out various tasks. Since then, the nineteenth (temporary) meeting, the twenty-second (temporary) meeting, and the twenty-sixth (temporary) meeting of the ninth session of board of directors of the company, and the second extraordinary shareholders’ meeting in 2017 reviewed and approved the relevant proposals on non-public offering of shares. Combining the capital market with the actual situation of the company, from January to February, 2018, the fourth (temporary) meeting of the 10th session of board of directors and the first extraordinary shareholders’ meeting of the company in 2018 reviewed and approved the Proposal on Adjusting the Plan for the Company’s Non-Public Offering of A-Shares, and the Proposal on the Plan for the Company’s Non-Public Offering of A-Shares (three revised versions) and other relevant proposals. According to the above proposals, the total amount of funds raised in this non-public offering of shares did not exceed 750 million Yuan, and planned to invest 680 million Yuan for the “online and offline marketing network platform construction and upgrade project” and planned to invest 70 million Yuan for the “R&D center construction project after deducting the issuance costs. Under the background that the traditional manufacturing industry at home was still sluggish, in accordance with the guidelines of “Made in China 2025”, the company insisted on accelerating its professional transformation and e-commercial transformation, striving to expand its main business, strengthening the structural adjustment, intensifying the quality management, strengthening cost control, overcoming the industry shocks and industry punches of share-bicycle’s fluctuation on the eve of the implementation of new national standards, strive to improving the ability of traditional enterprises to adapt to economy new normal and participate in market competition. Through various efforts, the company achieved operating revenue of 38,274,400 Yuan and net profit 10 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 of (1,090,500) Yuan in 2019, of which, the net profit attributable to shareholders of listed companies was (798,900) Yuan. II. Main business analysis See the “I-Introduction” in “Discussion and Analysis of the Business” Y-o-y changes of main financial data In RMB Current period Same period last year y-o-y changes (+, -) Reasons Decline in corporate Operating revenue 38,274,433.02 67,734,899.35 -43.49% business revenue Decline in corporate Operating costs 35,329,514.97 61,164,206.33 -42.24% business cost Sales expenses drops for Sales expenses 1,875,723.61 2,755,927.53 -31.94% the decline of business income Administration expenses 2,359,383.84 3,309,720.24 -28.71% Corporate bank deposit Finance expenses -60,452.99 -260,975.81 -76.84% interest income declined The Company loss in the Income tax expenses -4,152.36 233,133.98 -101.78% period by compare with same period last year Net cash flow arising Payment of tax payable -8,901,256.74 -3,362,971.19 164.68% from operating activities at the end of last year Net cash flow arising from investment -16,814.16 activities 筹资活动产生的现金流 16,600.82 量净额 Net increase of cash and Payment of tax payable -8,901,470.08 -3,362,971.19 164.69% cash equivalent at the end of last year Payment of tax payable Monetary funds 8,587,416.18 18,488,886.26 -53.55% at the end of last year The payment paid in advance for lithium battery materials Advance payment 5,139,379.30 13,799,753.60 -62.76% business last year, has been delivery in the period successively Other current assets 4,609,858.93 2,266,241.66 103.41% The input to be deducted 11 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 in the period increased Payment of tax payable Tax payable 120,561.17 6,297,096.28 -98.09% at the end of last year Major changes on profit composition or profit resources in reporting period □ Applicable √ Not applicable No major changes on profit composition or profit resources occurred in reporting period. Constitution of main business In RMB Increase or Increase or Increase or decrease of decrease of decrease of gross Operating Operating cost Gross profit ratio operating revenue operating cost profit ratio over revenue over same period over same period same period of of last year of last year last year According to industries Sales of bicycles and accessories 26,915,238.10 24,727,880.83 8.13% -38.17% -36.80% -1.99% and fittings Lithium battery 11,359,194.92 10,601,634.14 6.67% -53.06% -51.89% -2.27% materials According to products Sales of bicycles and accessories 26,915,238.10 24,727,880.83 8.13% -38.17% -36.80% -1.99% and fittings Lithium battery 11,359,194.92 10,601,634.14 6.67% -53.06% -51.89% -2.27% materials According to region Domestic 38,274,433.02 35,329,514.97 7.69% -43.49% -42.24% -2.01% III. Analysis of the non-main business □Applicable √ Not applicable IV. Assets and liability 1. Major changes of assets composition In RMB End of same period of last End of the Period year Ratio Notes of major changes Ratio in total Ratio in total changes Amount Amount assets assets Monetary fund 9,587,416.18 14.79% 15,814,304.99 22.33% -7.54% Account 35,560,204.56 54.85% 34,951,941.66 49.34% 5.51% 12 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 receivable Inventory 3,080,384.07 4.75% 4,810,375.32 6.79% -2.04% Fix assets 3,333,489.56 5.14% 3,756,571.22 5.30% -0.16% Advance payment 5,139,379.30 7.93% 6,076,785.42 8.58% -0.65% 2. Assets and liability measured by fair value □ Applicable √ Not applicable 3. Assets rights restricted till end of the period a. Other monetary funds with restriction in use amounted as 2,000,000.00 Yuan at end of the period, refers to the deposit of bank acceptance. b. Six suites of house properties at 7-20F Lianxin JiaYuan, Luohu District, Shenzhen, with original value of 2,959,824.00 Yuan, which were affordable housing purchased from the Housing and Construction Bureau of Luohu District to provide to enterprise talents for living. The contract stipulated that the purchasing enterprise is not allowed to conduct any form of property rights transaction with any units or individual other than the government. V. Investment 1. Overall situation □ Applicable √ Not applicable 2. The major equity investment obtained in the reporting period □ Applicable √ Not applicable 3. The major non-equity investment doing in the reporting period □ Applicable √ Not applicable 4. Financial assets investment (1) Securities investment □ Applicable √ Not applicable The Company had no securities investment in Period. 13 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (2) Derivative investment □ Applicable √ Not applicable The Company has no derivatives investment in Period. VI. Sales of major assets and equity 1. Sales of major assets □ Applicable √ Not applicable The Company has no sales of major assets in Period. 2. Sales of major equity □ Applicable √ Not applicable VII. Analysis of main holding company and stock-jointly companies √Applicable □ Not applicable Particular about main subsidiaries and stock-jointly companies net profit over 10% In RMB Company Main Register Operating Operating Type Total assets Net Assets Net profit name business capital revenue profit Shenzhen Sales of Emmelle 22,003,356.7 13,212,224.3 -975,809.6 Subsidiary bicycles and 2000000 7,942,168.75 -971,707.26 Industry Co., 2 4 2 accessories Ltd. Particular about subsidiaries obtained or disposed in report period □ Applicable √ Not applicable Notes of holding and shareholding companies The Company holds 70 percent equity of the Shenzhen Emmelle Industry Co., Ltd., the balance of minority equity at period-end amounting to 2,382,650.62 Yuan. VIII. Structured vehicle controlled by the Company □ Applicable √ Not applicable IX. Prediction of business performance from January – September 2019 Estimation on accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change compared with the corresponding period of the last year and explanation on reason □ Applicable √ Not applicable 14 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 X. Risks and countermeasures The tough international economic situation: The domestic economy is at the structural adjustment stage in the course of development, structural problems and deep-seated conflicts are highlighted. The economic downturn pressure continues to increase, many unstable and uncertain factors exist, which affect and impact the traditional manufacturing industries and the social consumption structure demand. Since the domestic economy is at the structural adjustment stage, coupled with a difficult situation of continuously rising labor cost, manufacturing cost, financing cost and material cost the bicycle industry as a conventional manufacturing field recorded a decline in the market turnover. Due to the low entry threshold and numerous manufacturers, the competition in the market is extremely fierce. The bicycle sharing brands such as Mobike have obtained large amount of financing and rapid promotion, but also further digested the user's demand, and squeezed the market space of traditional bicycle enterprises. Faced with the above problems, combine actual condition of financially insecure after reorganization, on the one hand, we adhere to traditional business model development, strengthen R&D of the products, and continue to optimize the structure for products and sales mode. According to the electricity supplier transformation and inner lead of the cost controlling, the Company proactively develop the electricity supplier business model; on the one hand, correspondingly carry out the tracking study on industrial projects and technology applications of upstream and downstream of industrial chain in the long-term process of electric bicycle business, start getting involved in the lithium battery materials business based on the extensive business consultation and business opportunity sifting, and take it as an opportunity to gradually expand its main business; on the other hand, we strive to promote the selection for recombinant party, planning a private placement of shares, and carry out a sport experience sales platform online and offline and the construction of R&D center, recently the business upgrade still in process. 15 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section V. Important Events I. In the report period, the Company held annual shareholders’ general meeting and extraordinary shareholders’ general meeting 1. Shareholders’ General Meeting in the report period Ratio of investor Index of Session of meeting Type Date Date of disclosure participation disclosure Notice of Resolution of First First Extraordinary Extraordinary Extraordinary shareholders shareholders 12.09% 2019-02-22 2019-02-22 shareholders general meeting general general meeting 2019 meeting 2019 (No.: 2019005) Notice of Annual Resolution of Annual General General 12.51% 2019-06-27 2019-06-27 Annual General Meeting 2018 Meeting Meeting 2018 (No.: 2019013) 2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore □ Applicable √ Not applicable II. Profit distribution plan and capitalizing of common reserves plan for the Period □ Applicable √ Not applicable The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve either for the semi-annual year. III. Commitments that actual controller, shareholder, related parties, buyer and committed party as the Company etc. have fulfilled during the reporting period and have not yet fulfilled by the end of reporting period □ Applicable √ Not applicable No commitments that actual controller, shareholders, related parties, buyer and committed party as the Company etc. have fulfilled during the reporting period and have not yet fulfilled by the end of reporting period 16 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 IV. Appointment and non-reappointment (dismissal) of CPA Financial report has been audited or not □ Yes √ No Not been audited. V. Explanation from Board of Directors, Supervisory Committee for “Qualified Opinion” that issued by CPA □ Applicable √ Not applicable VI. Explanation from the Board for “Qualified Opinion” of last year’s √Applicable □ Not applicable 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 12th, Oct., 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 25th, Oct., 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 CBC 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. The Company will continue to carry out vary works proactively in order to promoted the reorganization works. VII. Bankruptcy reorganization □ Applicable √ Not applicable 17 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 No bankruptcy reorganization for the Company in Period. VIII. Lawsuits Material lawsuits and arbitration □ Applicable √ Not applicable No significant lawsuits and arbitration occurred in the reporting period. Other lawsuits events □ Applicable √ Not applicable IX. Penalty and rectification □ Applicable √ Not applicable No penalty and rectification for the Company in Period. X. Integrity of the Company and its controlling shareholders and actual controllers □ Applicable √ Not applicable XI. Implementation of the Company’s stock incentive plan, employee stock ownership plan or other employee incentives □ Applicable √ Not applicable The Company has no equity incentive plan, employee stock ownership plans or other employee incentives in Period. XII. Major related transaction 1. Related transaction with routine operation concerned □ Applicable √ Not applicable The Company had no related transaction with routine operation concerned in Period. 2. Related transactions by assets acquisition and sold □ Applicable √ Not applicable No related transactions by assets acquisition and sold for the Company in Period. 3. Main related transactions of mutual investment outside □ Applicable √ Not applicable No main related transactions of mutual investment outside for the Company in Period. 18 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 4. Contact of related credit and debt √Applicable □ Not applicable Whether has non-operational contact of related liability and debts or not √ Yes □ No Claim receivable from related party: Whether Current Balance at Current Current Ending has newly period-be recovery interest balance Related Relations non-busin added Interest Causes gin (10 (10 (10 (10 party hip ess capital (10 rate thousand thousand thousand thousand occupying thousand Yuan) Yuan) Yuan) Yuan) or not Yuan) Influence on business performance and financial status of the N/A Company from related liabilities Debts payable to related party: Current Balance at Current Current newly Ending period-begi recovery interest Related Relationshi added balance (10 Causes n (10 (10 Interest rate (10 party p (10 thousand thousand thousand thousand thousand Yuan) Yuan) Yuan) Yuan) Yuan) Shenzhen Guosheng Subsidiar Energy The largest y 650 0 0 0.00% 0 650 Investment shareholder Emmelle Developme loan nt Co., Ltd. Influence on business performance and financial N/A status of the Company from related debts 5. Other significant related transactions □ Applicable √ Not applicable The company had no other significant related transactions in reporting period. 19 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 XIII. Non-business capital occupying by controlling shareholders and its related parties □ Applicable √ Not applicable No non-business capital occupied by controlling shareholders and its related parties in Period. XIV. Significant contract and implementations 1. Trusteeship, contract and leasing (1) Trusteeship □ Applicable √ Not applicable No trusteeship for the Company in Period. (2) Contract □ Applicable √ Not applicable No contract for the Company in Period. (3) Leasing □ Applicable √ Not applicable No leasing for the Company in Period. 2. Major guarantees □ Applicable √ Not applicable No guarantee for the Company in Period. 3. Other material contracts □ Applicable √ Not applicable No other material contracts for the Company in Period. XV. Social responsibility 1. Major environmental protection The listed Company and its subsidiary whether belong to the key sewage units released from environmental protection department Not applicable Nil 20 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 2. Fulfill the precise social responsibility for poverty alleviation (1) Targeted poverty alleviation Nil (2) Summary of semi-annual precision poverty alleviation Nil (3) Accuracy of poverty alleviation Measurement Target Numbers/progress units I. general condition —— —— II. Implemented by detail —— —— 1. Industrial development poverty —— —— 2.Transfer employment —— —— 3. Anti-poverty by relocating in other places —— —— 4. Education poverty —— —— 5. Health poverty alleviation —— —— 6. Ecological conservation —— —— 7. Fallback protection —— —— 8. Social poverty alleviation —— —— 9. Other —— —— III. Awards (content and level) —— —— (4) Subsequent precision poverty alleviation program Nil XVI. Other major events √Applicable □ Not applicable In July 2016, the Company started to plan a non-public issue of shares with proceeds to be utilized to acquire material assets. The Plan on Non-public Issue of A shares in 2016 was considered and approved by the Board of the Company. Based on the due diligence, audit, assessment and business negation with intermediates, taking into account the conditions of capital market and actual conditions of the Company, the Board of the Company considered and approved the Proposal Relating to Adjusting the Plan of non-public of A Shares, the Explanation on non-public of A-shares for year of 2016 Amendment, the Plan on Non-public Issue of A shares in 2016 21 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (amended), the Plan on Non-public Issue of A shares in 2016 (Second Amended) and Plan on Non-public Issue of A shares in 2016 (Third Amended) from February 2017 to February 2018. and on 13 Feb. 2018, the Plan on Non-public Issue of A Shares (Third Amended) was deliberated and approved by First Extraordinary Shareholders General Meeting of 2018. According to the three revised drafts, the number of non-public offering of shares should not exceed 110,269,586 shares, and the total amount of funds raised should not exceed 750 million Yuan. The total amount of raised funds for this non-public offering should not exceed RMB 750 million, will be used for the following projects after deducting the issuance expenses: 1. RMB 680 million of funds for “online and offline marketing network platform construction and upgrading project”; 2. RMB 70 million of funds for “R & D center construction project”. The issuing objects of this non-public offering include four specific investors which are Ruian Information, Zhisheng High-tech, Wansheng Industry and Beier High-tech. The subscription amount of Ruian Information does not exceed 250 million Yuan, and the number of subscribed shares does not exceed 36,756,529 shares; the subscription amount of Zhisheng High-tech does not exceed 200 million Yuan, and the number of subscribed shares does not exceed 29,405,223 shares; the subscription amount of Wansheng Industry and Beier High-tech respectively does not exceed 150 million Yuan, and the number of subscribed shares does not exceed 22,053,917 shares respectively. See details on the announcement issued by the board of directors of the company. XVII. Major event of the subsidiaries □ Applicable √ Not applicable 22 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section VI. Changes in Shares and Shareholders I. Changes in Share Capital 1. Changes in Share Capital In Share Before the Change Increase/Decrease in the Change (+, -) After the Change Capitalizat New Bonus ion of Proportio Amount Proportion shares Others Subtotal Amount shares public n issued reserve I. Restricted shares 3,957 0.00% 0 3,957 0.00% 1. State-owned shares 0 0.00% 0 0 0.00% 2. State-owned legal 0 0.00% 0 0 0.00% person’s shares 3. Other domestic shares 3,957 0.00% 0 3,957 0.00% Including: Domestic legal 0 0.00% 0 0 0.00% person’s shares Domestic natural person’s 3,957 0.00% 0 3,957 0.00% shares 4. Foreign shares 0 0.00% 0 0 0.00% Including: Foreign legal 0 0.00% 0 0 0.00% person’s shares Foreign natural person’s 0 0.00% 0 0 0.00% shares 551,343,9 551,343,9 II. Unrestricted shares 100.00% 0 100.00% 90 90 302,981,0 302,981,0 1. RMB Ordinary shares 54.95% 0 54.95% 08 08 2. Domestically listed 248,362,9 248,362,9 45.05% 0 45.05% foreign shares 82 82 3. Overseas listed foreign 0 0.00% 0 0 0.00% shares 4. Others 0 0.00% 0 0 0.00% 551,347,9 551,347,9 III. Total shares 100.00% 0 100.00% 47 47 Reasons for share changed 23 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 □ Applicable √ Not applicable Approval of share changed □ Applicable √ Not applicable Ownership transfer of share changes □ Applicable √ Not applicable Progress of shares buy-back □Applicable √Not applicable Implementation progress of the reduction of repurchases shares by centralized bidding □Applicable √Not applicable Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common shareholders of Company in latest year and period □ Applicable √ Not applicable Other information necessary to disclose or need to disclosed under requirement from security regulators □ Applicable √ Not applicable 2. Changes of restricted shares □ Applicable √ Not applicable II. Securities issuance and listing □ Applicable √ Not applicable III. Number of shares and shares held In Share Total preference shareholders Total common shareholders at with voting rights recovered at 49,822 0 period-end end of reporting period (if applicable) (note 8) Particulars about common shares held above 5% by shareholders or top ten common shareholders Amount of Number of share Number of Changes Amount of Proportion restricted pledged/frozen Nature of common in un-restricted Shareholders of shares common shareholder shares held at reporting common State of held shares Amount period-end period shares held share held Shenzhen Domestic 11.52% 63,508,747 0 0 63,508,747 - - 24 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Guosheng non-State-owned Energy legal person Investment Development Co., Ltd. UOB Koy Hian Foreign legal (Hong Kong) 2.89% 15,907,850 0 0 15,907,850 - - person Co., Ltd. Guosen Securities Foreign legal (Hong Kong) 2.52% 13,909,425 0 0 13,909,425 - - person brokerage Co., Ltd. Shenwan Hongyuan Foreign legal Securities 1.20% 6,631,116 0 0 6,631,116 - - person (Hong Kong) Co., Ltd. Domestic nature Li Huili 0.71% 3,891,124 0 0 3,891,124 - - person CMS Hong State-owned legal 0.57% 3,148,752 91,400 0 3,148,752 - - Kong Co., Ltd person Domestic nature Xu Hongbo 0.50% 2,744,419 -393,000 0 2,744,419 - - person Domestic nature Ge Zhiqiong 0.49% 2,720,552 523,736 0 2,720,552 - - person Special Account for Property Domestic Disposal of non-State-owned 0.47% 2,602,402 0 0 2,602,402 - - Bankrupt legal person Enterprise of CBC Zhuorun Foreign legal Technology 0.36% 2,000,000 0 0 2,000,000 - - person Co., Ltd. Strategy investors or general corporation comes top 10 common N/A stock shareholders due to rights issue (if applicable) (see note 3) Explanation on associated Li Huili, spouse of the Ji Hanfei, the actual controller of the Company- Shenzhen Guosheng relationship among the aforesaid Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of 25 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 shareholders Shenzhen Guosheng Energy Investment Development Co., Ltd., beyond that, the Company has no idea of whether other circulated shareholders belong to concerted action persons ruled in the Administration Norms for Information Disclosure of Change on Shareholding of Shareholders of Listed Companies. Particular about top ten common shareholders with un-restrict shares held Amount of un-restrict common shares held at Type of shares Shareholders period-end Type Amount Shenzhen Guosheng Energy RMB common 63,508,747 63,508,747 Investment Development Co., Ltd. shares Domestically UOB Koy Hian (Hong Kong) Co., 15,907,850 listed foreign 15,907,850 Ltd. shares Domestically Guosen Securities (Hong Kong) 13,909,425 listed foreign 13,909,425 brokerage Co., Ltd. shares Domestically Shenwan Hongyuan Securities 6,631,116 listed foreign 6,631,116 (Hong Kong) Co., Ltd. shares Domestically Li Huili 3,891,124 listed foreign 3,891,124 shares Domestically CMS Hong Kong Co., Ltd 3,148,752 listed foreign 3,148,752 shares Domestically Xu Hongbo 2,744,419 listed foreign 2,744,419 shares RMB common 233,900 shares Ge Zhiqiong 2,720,552 Domestically listed foreign 2,486,652 shares RMB common 1,383,313 Special Account for Property shares Disposal of Bankrupt Enterprise of 2,602,402 Domestically CBC listed foreign 1,219,089 shares RMB common Zhuorun Technology Co., Ltd. 2,000,000 2,000,000 shares Expiation on associated relationship Li Huili, spouse of the Ji Hanfei, the actual controller of he Company- Shenzhen Guosheng 26 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 or consistent actors within the top Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of 10 un-restrict shareholders and Shenzhen Guosheng Energy Investment Development Co., Ltd., beyond that, the Company between top 10 un-restrict has no idea of whether other circulated shareholders belong to concerted action persons ruled shareholders and top 10 in the Administration Norms for Information Disclosure of Change on Shareholding of shareholders Shareholders of Listed Companies. Explanation on top 10 shareholders involving margin business (if N/A applicable) (see note 4) Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period □Yes √No Top ten common shareholders or top ten common shareholders with un-restrict shares not held have a buy-back agreement dealing in reporting period IV. Changes of controlling shareholders or actual controller Changes of controlling shareholders in reporting period □ Applicable √ Not applicable Changes of controlling shareholders had no change in reporting period. Changes of actual controller in reporting period □ Applicable √ Not applicable Changes of actual controller in reporting period had no change in reporting period. 27 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section VII. Preferred Stock □ Applicable √ Not applicable The Company had no preferred stock in the reporting. 28 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section VIII. Directors, Supervisors and Senior Executives I. Changes of shares held by directors, supervisors and senior executives □Applicable √ Not applicable Found more in annual report 2018 for the changes of shares held by directors, supervisors and senior executives II. Resignation and dismissal of directors, supervisors and senior executives □Applicable √ Not applicable No changes of directors, supervisors and senior executives, found more details in Annual Report 2018. 29 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section IX. Corporate Bonds Whether the Company has corporate bonds that issuance publicly and listed on stock exchange and without due on the date when semi-annual report approved for released or fail to cash in full on due No 30 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section X. Financial Report I. Audit reports Whether the semi-annual report was audited or not □ Yes √ No The financial report of this semi-annual report was unaudited. II. Financial statements Units in Notes of Financial Statements is RMB 1. Consolidated Balance Sheet Prepared by Shenzhen China Bicycle Company (Holdings) Limited 2019-06-30 In RMB Item 2019-6-30 2018-12-31 Current assets: Monetary funds 9,587,416.18 18,488,886.26 Settlement provisions Capital lent Tradable financial assets Financial assets measured by fair value and with variation reckoned into current gains/losses Derivative financial assets Note receivable 180,000.00 Account receivable 35,560,204.56 29,007,509.02 Receivable financing Accounts paid in advance 5,139,379.30 13,799,753.60 Insurance receivable Reinsurance receivables Contract reserve of reinsurance receivable Other account receivable 765,634.71 844,537.19 31 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Including: Interest receivable Dividend receivable Buying back the sale of financial assets Inventories 3,080,384.07 2,386,603.94 Contractual assets Assets held for sale Non-current asset due within one year Other current assets 4,609,858.93 2,266,241.66 Total current assets 58,922,877.75 66,793,531.67 Non-current assets: Loans and payments on behalf Debt investment Finance asset available for sales Other debt investment Held-to-maturity investment Long-term account receivable Long-term equity investment Investment in other equity instrument Other non-current financial assets Investment real estate Fixed assets 3,333,489.56 3,502,807.32 Construction in progress Productive biological asset Oil and gas asset Right-of-use assets Intangible assets 1,129,500.00 1,506,000.00 Expense on Research and Development Goodwill Long-term expenses to be apportioned Deferred income tax asset 1,044,773.54 1,040,621.18 32 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Other non-current asset 400,000.00 400,000.00 Total non-current asset 5,907,763.10 6,449,428.50 Total assets 64,830,640.85 73,242,960.17 Current liabilities: Short-term loans Loan from central bank Capital borrowed Transactional financial liability Financial liability measured by fair value and with variation reckoned into current gains/losses Derivative financial liability Note payable 2,000,000.00 2,000,000.00 Account payable 7,076,229.24 9,979,010.69 Accounts received in advance 1,620,392.20 405,779.88 Selling financial asset of repurchase Absorbing deposit and interbank deposit Security trading of agency Security sales of agency Wage payable 539,521.95 435,736.16 Taxes payable 120,561.17 6,297,096.28 Other account payable 37,583,929.90 37,144,872.42 Including: Interest payable Dividend payable Commission charge and commission payable Reinsurance payable Contractual liability Liability held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities 48,940,634.46 56,262,495.43 Non-current liabilities: 33 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Insurance contract reserve Long-term loans Bonds payable Including: Preferred stock Perpetual capital securities Lease liability 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 48,940,634.46 56,262,495.43 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 -1,198,348,116.09 -1,197,549,169.92 Total owner’ s equity attributable to 13,507,355.77 14,306,301.94 parent company Minority interests 2,382,650.62 2,674,162.80 Total owner’ s equity 15,890,006.39 16,980,464.74 Total liabilities and owner’ s equity 64,830,640.85 73,242,960.17 Legal Representative: Li Hai 34 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 2019-6-30 2018-12-31 Current assets: Monetary funds 4,164,849.07 8,889,572.73 Transactional financial assets Financial assets measured by fair value and with variation reckoned into current gains/losses Derivative financial assets Note receivable 180,000.00 Account receivable 25,962,772.24 12,827,954.16 Receivable financing Accounts paid in advance 5,138,078.18 13,798,452.48 Other account receivable 380,925.78 380,925.78 Including: Interest receivable Dividend receivable Inventories 871,653.54 Contractual assets Assets held for sale Non-current assets maturing within one year Other current assets 4,080,909.10 2,130,677.11 Total current assets 40,779,187.91 38,027,582.26 Non-current assets: Debt investment Available-for-sale financial assets Other debt investment Held-to-maturity investments Long-term receivables Long-term equity investments 10,379.73 10,379.73 35 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Investment in other equity instrument Other non-current financial assets Investment real estate Fixed assets 2,891,083.46 2,995,407.48 Construction in progress Productive biological assets Oil and natural gas assets Right-of-use assets Intangible assets 1,129,500.00 1,506,000.00 Research and development costs Goodwill Long-term deferred expenses Deferred income tax assets Other non-current assets 400,000.00 400,000.00 Total non-current assets 4,430,963.19 4,911,787.21 Total assets 45,210,151.10 42,939,369.47 Current liabilities Short-term borrowings Transactional financial liability Financial liability measured by fair value and with variation reckoned into current gains/losses Derivative financial liability Notes payable Account payable 5,722,478.65 Accounts received in advance 2,016,142.00 327,632.18 Contractual liability Wage payable 394,245.36 151,598.60 Taxes payable 120,548.17 5,416,117.27 Other accounts payable 28,998,519.55 28,967,052.96 Including: Interest payable Dividend payable Liability held for sale Non-current liabilities due within 36 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 one year Other current liabilities Total current liabilities 37,251,933.73 34,862,401.01 Non-current liabilities: Long-term loans Bonds payable Including: preferred stock Perpetual capital securities Lease liability Long-term account payable Long term employee compensation payable Accrued liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities 37,251,933.73 34,862,401.01 Owners’ 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 Special reserve Surplus reserve 32,673,227.01 32,673,227.01 Retained profit -1,203,897,254.49 -1,203,778,503.40 Total owner’s equity 7,958,217.37 8,076,968.46 Total liabilities and owner’s equity 45,210,151.10 42,939,369.47 37 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 3. Consolidated Profit Statement In RMB Item Semi-annual of 2019 Semi-annual of 2018 I. Total operating income 38,274,433.02 67,734,899.35 Including: Operating income 38,274,433.02 67,734,899.35 Interest income Insurance gained Commission charge and commission income II. Total operating cost 39,540,757.20 67,044,616.04 Including: Operating cost 35,329,514.97 61,164,206.33 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 36,587.77 75,737.75 Sales expense 1,875,723.61 2,755,927.53 Administrative expense 2,359,383.84 3,309,720.24 R&D expense Financial expense -60,452.99 -260,975.81 Including: Interest expenses Interest income -71,134.40 -272,685.93 Add: other income Investment income (Loss is listed with “-”) Including: Investment income on affiliated company and joint venture The termination of income recognition for financial assets measured 38 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 by amortized cost(Loss is listed with “-”) Exchange income (Loss is listed with “-”) Net exposure hedging income (Loss is listed with “-”) Income from change of fair value (Loss is listed with “-”) Loss of credit impairment -17,479.82 -7,219.20 (Loss is listed with “-”) Losses of devaluation of asset 40,616.29 (Loss is listed with “-”) Income from assets disposal (Loss is listed with “-”) III. Operating profit (Loss is listed with -1,243,187.71 683,064.11 “-”) Add: Non-operating income 148,627.00 72,126.28 Less: Non-operating expense 50.00 30,140.00 IV. Total profit (Loss is listed with “-”) -1,094,610.71 725,050.39 Less: Income tax expense -4,152.36 233,133.98 V. Net profit (Net loss is listed with “-”) -1,090,458.35 491,916.41 (i) Classify by business continuity 1.continuous operating net profit -1,090,458.35 491,916.41 (net loss listed with ‘-”) 2.termination of net profit (net loss listed with ‘-”) (ii) Classify by ownership 1.Net profit attributable to owner’s -798,946.17 554,162.06 of parent company 2.Minority shareholders’ gains and -291,512.18 -62,245.65 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 39 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 1.Changes of the defined benefit plans that re-measured 2.Other comprehensive income under equity method that cannot be transfer to gain/loss 3.Change of fair value of investment in other equity instrument 4.Fair value change of enterprise's credit risk 5. Other (ii) Other comprehensive income items which will be reclassified subsequently to profit or loss 1.Other comprehensive income under equity method that can transfer to gain/loss 2.Change of fair value of other debt investment 3.gain/loss of fair value changes for available-for-sale financial assets 4.Amount of financial assets re-classify to other comprehensive income 5.Gain/loss of held-to-maturity investments that re-classify to available-for-sale financial asset 6.Credit impairment provision for other debt investment 7.Cash flow hedging reserve 8.Translation differences arising on translation of foreign currency financial statements 9.Other Net after-tax of other comprehensive income attributable to minority shareholders VII. Total comprehensive income -1,090,458.35 491,916.41 40 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total comprehensive income -798,946.17 554,162.06 attributable to owners of parent Company Total comprehensive income -291,512.18 -62,245.65 attributable to minority shareholders VIII. Earnings per share: (i) Basic earnings per share -0.0014 0.0010 (ii) Diluted earnings per share -0.0014 0.0010 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 Semi-annual of 2019 Semi-annual of 2018 I. Operating income 25,404,378.84 24,023,518.68 Less: Operating cost 23,670,022.62 20,846,218.08 Taxes and surcharge 14,194.90 13,741.20 Sales expenses 240,105.59 276,827.75 Administration expenses 1,721,493.88 2,107,312.50 R&D expenses Financial expenses -13,583.08 -83,003.31 Including: interest expenses Interest income -18,497.84 -87,908.66 Add: other income Investment income (Loss is listed with “-”) Including: Investment income on affiliated Company and joint venture The termination of income recognition for financial assets measured by amortized cost (Loss is listed with “-”) 41 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Net exposure hedging income (Loss is listed with “-”) Changing income of fair value (Loss is listed with “-”) Loss of credit impairment -39,523.02 (Loss is listed with “-”) Losses of devaluation of asset 2,008.04 (Loss is listed with “-”) Income on disposal of assets (Loss is listed with “-”) II. Operating profit (Loss is listed with -267,378.09 864,430.50 “-”) Add: Non-operating income 148,627.00 68,105.41 Less: Non-operating expense III. Total Profit (Loss is listed with “-”) -118,751.09 932,535.91 Less: Income tax 233,133.98 IV. Net profit (Net loss is listed with -118,751.09 699,401.93 “-”) (i)continuous operating net profit -118,751.09 699,401.93 (net loss listed with ‘-”) (ii) termination of net profit (net loss 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 of the defined benefit plans that re-measured 2.Other comprehensive income under equity method that cannot be transfer to gain/loss 3.Change of fair value of investment in other equity instrument 4.Fair value change of enterprise's credit risk 5. Other (II) Other comprehensive income items which will be reclassified 42 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 subsequently to profit or loss 1.Other comprehensive income under equity method that can transfer to gain/loss 2.Change of fair value of other debt investment 3.gain/loss of fair value changes for available-for-sale financial assets 4.Amount of financial assets re-classify to other comprehensive income 5.Gain/loss of held-to-maturity investments that re-classify to available-for-sale financial asset 6.Credit impairment provision for other debt investment 7.Cash flow hedging reserve 8.Translation differences arising on translation of foreign currency financial statements 9.Other VI. Total comprehensive income -118,751.09 699,401.93 VII. Earnings per share: (i) Basic earnings per share -0.0002 0.0013 (ii) Diluted earnings per share -0.0002 0.0013 5. Consolidated Cash Flow Statement In RMB Item Semi-annual of 2019 Semi-annual of 2018 I. Cash flows arising from operating activities: Cash received from selling commodities and providing labor 8,643,245.76 15,792,549.13 services Net increase of customer deposit 43 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 Cash received from interest, commission charge and commission Net increase of capital borrowed Net increase of returned business capital Net cash received by agents in sale and purchase of securities Write-back of tax received 57,448.96 5,306.26 Other cash received concerning 3,906,596.03 2,529,012.36 operating activities Subtotal of cash inflow arising from 12,607,290.75 18,326,867.75 operating activities Cash paid for purchasing commodities and receiving labor 7,104,453.81 12,448,466.83 service Net increase of customer loans and advances Net increase of deposits in central bank and interbank Cash paid for original insurance contract compensation Net increase of financial assets held for transaction purposes Net increase of capital lent Cash paid for interest, commission charge and commission Cash paid for bonus of guarantee 44 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 slip Cash paid to/for staff and workers 3,076,592.48 3,190,388.60 Taxes paid 5,517,601.44 1,336,400.97 Other cash paid concerning 5,809,899.76 4,714,582.54 operating activities Subtotal of cash outflow arising from 21,508,547.49 21,689,838.94 operating activities Net cash flows arising from operating -8,901,256.74 -3,362,971.19 activities II. Cash flows arising from investing 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 investing activities Subtotal of cash inflow from investing activities Cash paid for purchasing fixed, 16,814.16 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 investing activities Subtotal of cash outflow from investing 16,814.16 activities Net cash flows arising from investing -16,814.16 activities III. Cash flows arising from financing activities 45 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 2,016,600.82 financing activities Subtotal of cash inflow from financing 2,016,600.82 activities 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 financing activities Subtotal of cash outflow from financing 2,000,000.00 activities Net cash flows arising from financing 16,600.82 activities IV. Influence on cash and cash equivalents due to fluctuation in exchange rate V. Net increase of cash and cash -8,901,470.08 -3,362,971.19 equivalents Add: Balance of cash and cash 16,488,886.26 19,177,276.18 equivalents at the period -begin VI. Balance of cash and cash 7,587,416.18 15,814,304.99 equivalents at the period -end 6. Cash Flow Statement of Parent Company In RMB Item Semi-annual of 2019 Semi-annual of 2018 I. Cash flows arising from operating activities: 46 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Cash received from selling commodities and providing labor 2,949,631.00 6,974.00 services Write-back of tax received 57,448.96 5,306.26 Other cash received concerning 4,242,368.68 1,963,467.24 operating activities Subtotal of cash inflow arising from 7,249,448.64 1,975,747.50 operating activities Cash paid for purchasing commodities and receiving labor 721,217.50 17,278.04 service Cash paid to/for staff and workers 1,498,002.56 1,237,282.20 Taxes paid 5,319,908.09 733,058.03 Other cash paid concerning 4,418,229.99 4,794,142.84 operating activities Subtotal of cash outflow arising from 11,957,358.14 6,781,761.11 operating activities Net cash flows arising from operating -4,707,909.50 -4,806,013.61 activities II. Cash flows arising from investing 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 investing activities Subtotal of cash inflow from investing activities Cash paid for purchasing fixed, 16,814.16 intangible and other long-term assets Cash paid for investment Net cash received from 47 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 subsidiaries and other units obtained Other cash paid concerning investing activities Subtotal of cash outflow from investing 16,814.16 activities Net cash flows arising from investing -16,814.16 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 financing activities Subtotal of cash inflow from financing activities Cash paid for settling debts Cash paid for dividend and profit distributing or interest paying Other cash paid concerning financing activities Subtotal of cash outflow from financing activities Net cash flows arising from financing activities IV. Influence on cash and cash equivalents due to fluctuation in exchange rate V. Net increase of cash and cash -4,724,723.66 -4,806,013.61 equivalents Add: Balance of cash and cash 8,889,572.73 15,398,405.80 equivalents at the period -begin VI. Balance of cash and cash 4,164,849.07 10,592,392.19 equivalents at the period -end 7. Statement of Changes in Owners’ Equity (Consolidated) This Period 48 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 In RMB Semi-annual of 2019 Owners’ equity attributable to parent company Other equity instrument Other Minori Total Item Perpe Less: compr Provisi ty owners Share Reaso Surplu Retain tual Capital Invent ehensi on of Subtot interes ’ capita Prefe nable s ed Other capit reserve ory ve genera al ts equity l rred Other reserve reserve profit al shares incom l risk stock secur e ities I. Balance at the 551,3 627,83 32,673 -1,197, 14,306 16,980 2,674, end of the last 47,94 4,297. ,227.0 549,16 ,301.9 ,464.7 162.80 year 7.00 85 1 9.92 4 4 Add: Changes of accounting policy Error correction of the last period Enterprise combine under the same control Other II. Balance at 551,3 627,83 32,673 -1,197, 14,306 16,980 2,674, the beginning of 47,94 4,297. ,227.0 549,16 ,301.9 ,464.7 162.80 this year 7.00 85 1 9.92 4 4 III. Increase/ Decrease in this -798,9 -798,9 -291,5 -1,090, year (Decrease 46.17 46.17 12.18 458.35 is listed with “-”) (i) Total -798,9 -798,9 -291,5 -1,090, comprehensive 46.17 46.17 12.18 458.35 income (ii) Owners’ devoted and decreased capital 1.Common shares invested by shareholders 2. Capital invested by holders of other equity 49 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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.Carry-over retained earnings from the defined benefit plans 5.Carry-over retained earnings from other comprehensive income 6. Other (V) Reasonable reserve 1. Withdrawal 50 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 in the report period 2. Usage in the report period (VI)Others IV. Balance at 551,3 627,83 32,673 -1,198, 13,507 15,890 2,382, the end of the 47,94 4,297. ,227.0 348,11 ,355.7 ,006.3 650.62 report period 7.00 85 1 6.09 7 9 Last Period In RMB Semi-annual of 2018 Owners’ equity attributable to parent company Other equity instrument Other Minorit Perp Less: compr Provisi Total Item y Share Reaso Surplu Retain etual Capital Invent ehensi on of Subtot interest owners’ capita Prefe nable s ed Other equity capit reserve ory ve genera al s l rred Other reserve reserve profit al shares incom l risk stock secur e ities I. Balance at 551,3 627,83 32,673 -1,195, 15,898 2,962,6 18,860, the end of the 47,94 4,297. ,227.0 957,20 ,270.8 99.67 970.52 last year 7.00 85 1 1.01 5 Add: Changes of accounting policy Error correction of the last period Enterprise combine under the same control Other II. Balance at 551,3 627,83 32,673 -1,195, 15,898 2,962,6 18,860, the beginning 47,94 4,297. ,227.0 957,20 ,270.8 99.67 970.52 of this year 7.00 85 1 1.01 5 III. Increase/ Decrease in this 554,16 554,16 -62,245 491,916 year (Decrease 2.06 2.06 .65 .41 is listed with “-”) (i) Total 554,16 554,16 -62,245 491,916 comprehensive 51 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 income 2.06 2.06 .65 .41 (ii) Owners’ devoted and decreased capital 1.Common shares invested by shareholders 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.Carry-over retained 52 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 earnings from the defined benefit plans 5.Carry-over retained earnings from other comprehensive income 6. Other (V) Reasonable reserve 1. Withdrawal in the report period 2. Usage in the report period (VI)Others IV. Balance at 551,3 627,83 32,673 -1,195, 16,452 2,900,4 19,352, the end of the 47,94 4,297. ,227.0 403,03 ,432.9 54.02 886.93 report period 7.00 85 1 8.95 1 8. Statement of Changes in Owners’ Equity (Parent Company) This Period In RMB Semi-annual of 2019 Other equity instrument Perpet Other Capital Less: Reasona Total Item Share Preferr ual compreh Surplus Retaine public Inventor ble Other owners’ capital ed capital Other ensive reserve d profit reserve y shares reserve equity stock securiti income es I. Balance at the 551,34 627,834, 32,673,2 -1,203, 8,076,968. end of the last 7,947.0 778,50 297.85 27.01 46 year 0 3.40 Add: Changes of accounting policy Error correction of the last period Other II. Balance at the 551,34 627,834, 32,673,2 -1,203, 8,076,968. beginning of this 53 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 year 7,947.0 297.85 27.01 778,50 46 0 3.40 III. Increase/ Decrease in this -118,75 -118,751.0 year (Decrease is 1.09 9 listed with “-”) (i) Total -118,75 -118,751.0 comprehensive 1.09 9 income (ii) Owners’ devoted and decreased capital 1.Common shares invested by shareholders 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 54 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 4.Carry-over retained earnings from the defined benefit plans 5.Carry-over retained earnings from other comprehensive income 6. Other (V) Reasonable reserve 1. Withdrawal in the report period 2. Usage in the report period (VI)Others IV. Balance at 551,34 -1,203, 627,834, 32,673,2 7,958,217. the end of the 7,947.0 897,25 297.85 27.01 37 report period 0 4.49 Last period In RMB Semi-annual of 2018 Other equity instrument Other Perpet Capital Less: Total Item Share compre Reasonab Surplus Retained Preferr ual public Inventor Other owners’ capital hensive le reserve reserve profit ed capital Other reserve y shares equity income stock securit ies I. Balance at the 551,34 627,834 32,673, -1,202,85 8,995,684.6 end of the last 7,947. ,297.85 227.01 9,787.18 8 year 00 Add: Changes of accounting policy Error correction of the last period Other II. Balance at 551,34 627,834 32,673, -1,202,85 8,995,684.6 the beginning 7,947. ,297.85 227.01 9,787.18 8 of this year 00 III. Increase/ 699,401.9 699,401.93 Decrease in this 3 55 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 year (Decrease is listed with “-”) (i) Total 699,401.9 comprehensive 699,401.93 3 income (ii) Owners’ devoted and decreased capital 1.Common shares invested by shareholders 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.Carry-over retained 56 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 earnings from the defined benefit plans 5.Carry-over retained earnings from other comprehensive income 6. Other (V) Reasonable reserve 1. Withdrawal in the report period 2. Usage in the report period (VI)Others IV. Balance at 551,34 627,834 32,673, -1,202,16 9,695,086.6 the end of the 7,947. ,297.85 227.01 0,385.25 1 report period 00 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 business activities: Research & development and production of bicycles, electric bicycles, electric motorcycles, motorcycles, electric tricycles, electric four-wheelers, children's bicycles, exercise bikes, sports 57 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 equipment, mechanical products, toys, electric toys, electronic products, new energy equipment and storage equipment (lithium batteries, batteries, etc.), household appliances and spare parts, and electronic components; wholesale, retail, import and export and related supporting business of above-mentioned products (excluding commodities subject to state trade management, handling the application according to the relevant national regulations for commodities involving quotas, license management and other special provisions and management,); fine chemical products (excluding dangerous goods), wholesale and retail of carbon fiber composite materials; technology development of computer software, transfer of self-developed technological achievements, and providing relevant technical information consultation; own property leasing; property management. (The above projects do not involve special administrative measures for the implementation access of national regulations, and those involving restricted projects and pre-existing administrative licenses must obtain the pre-existing administrative licensing documents before operation.) 3. Release of the financial report The Financial Report released on 28 August 2019 after approved by 15th session of 10th BOD of the Company One subsidiary included in consolidate scope in the period, found more in Note VIII-1 and Note IX-1 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 58 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 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 59 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 60 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 61 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 62 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 63 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 64 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 65 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 66 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 12. Account receivable (1) Account receivable with single significant amount and withdrawal bad debt provision on single basis Single significant account: the single receivable has over 5 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 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. (2) Provision for bad debts of accounts receivables by portfolio Receivables with non-significant single amount at the end of the period are divided into several portfolios together with the receivables that have not been impaired after the separate test by regarding aging as the credit risk characteristics, and a certain ratio of the closing balance of these receivables portfolios is calculated to determine the impairment loss and the provision for bad debts Except for the receivables with separate provision for impairment, the company determines the proportion of following bad debt provisions according to the same or similar in previous years, based on the actual loss rate of the portfolio by regarding receivables aging as the credit risk characteristics, and combined with the current situation: (2) Aging analysis Account age Accrual ratio for account receivable Within one year(one year included) 0.3% 1~2 years(2 years included) 0.3% 2~3 years(3 years included) 0.3% Over 3 years 100% Including: unrecoverable Charge off Note: the account receivable and other account receivable between the enterprises in consolidate scope are not have bad debt provision accrual (3) Account receivable with minor single amount but with bad debt provision accrual on single basis Reasons for provision of bad debt reserve: 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 67 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. Provision method of bad debt reserve: 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 based on the balance between the present value of future cash flows and its book value. 13. Account receivable financing 14. Other account receivable Determining method and accounting treatment on the expected credit loss of other account receivable (1)Account receivable with single significant amount and withdrawal bad debt provision on single basis: Single significant account: the single receivable has over 5 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 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. (2) Provision for bad debts of accounts receivables by portfolio Receivables with non-significant single amount at the end of the period are divided into several portfolios together with the receivables that have not been impaired after the separate test by regarding aging as the credit risk characteristics, and a certain ratio of the closing balance of these receivables portfolios is calculated to determine the impairment loss and the provision for bad debts Except for the receivables with separate provision for impairment, the company determines the proportion of following bad debt provisions according to the same or similar in previous years, based on the actual loss rate of the portfolio by regarding receivables aging as the credit risk characteristics, and combined with the current situation: (2) Aging analysis Account age Accrual ratio for other account receivable Within one year(one year included) 0.3% 1~2 years(2 years included) 0.3% 2~3 years(3 years included) 0.3% Over 3 years 100% Including: unrecoverable Charge off Note: the account receivable and other account receivable between the enterprises in consolidate scope are not have bad debt provision accrual 68 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (3) Account receivable with minor single amount but with bad debt provision accrual on single basis Reasons for provision of bad debt reserve: 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 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. Provision method of bad debt reserve: 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 based on the balance between the present value of future cash flows and its book value. 15. 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. 69 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 16. Contract assets 17. Contract cost 18. 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 70 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 19. Creditors’ investment 20. Other creditors’ investment 21. Long-term account receivable 22. 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 71 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 72 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 23. 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 73 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 24. 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 and buildings Straight-line depreciation 20-year 10% 4.5% Machinery equipment Straight-line depreciation 10-year 10% 9% Office equipment Straight-line depreciation 5-year 10% 18% Electronic equipment Straight-line depreciation 5-year 10% 18% Means of transportation Straight-line depreciation 5-year 10% 18% Other equipment Straight-line depreciation 5-year 10% 18% (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 74 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 25. Construction in progress (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. 26. Borrowing expenses 27. Biological assets 28. Oil and gas assets 29. Right-of-use assets 30. 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. 75 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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. 31. Impairment of long-term assets 32. 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. 33. Contract liability 34. 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. 76 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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. 35. Lease liability 36. 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 77 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 date. 37. 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. 78 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 38. 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. 79 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 39. Revenue Whether the company needs to comply with the disclosure requirements of the particular industry No Whether implemented the new revenue standards □Yes √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 80 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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. 40. 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. 81 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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. 41. 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 82 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 loss, excluding those arising from the following circumstances: ① business combination; and ② the transactions or items directly recognized in equity. 42. 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. 43. 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 83 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (3) it only establishes for acquisition of subsidiary through disposal. Accounting for discontinued operation is set out in note V-13 “Assets held for sale”. 44. Major accounting policy and changes (1)Main accounting policy changes □Applicable √Not applicable (2) Changes of important accounting estimate □Applicable √Not applicable (3) Adjustment the financial statements at the beginning of the first year of implementation of new financial instrument standards, new revenue standards and new leasing standards □Applicable √Not applicable (4) Retrospective adjustment of early comparison data description when initially implemented the new financial instrument standards and new leasing standards □Applicable √Not applicable 45. 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%, 13%, 16% 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% 84 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Property tax Turnover tax payable 1.2% Disclose reasons for different taxpaying body Taxpaying body Income tax rate The Company 25.00% Shenzhen Emmelle Industrial Co., Ltd. 25.00% 2. Tax preference Nil 3. Other According to the “Notice on Deepening the Policies Related to Value-Added Tax Reform” issued by Ministry of Finance, the State Administration of Taxation and the General Administration of Customs on March 21, 2019, from April 1, 2019, for taxpayers’ taxable sales behaviors or imported goods of VAT, if the original tax rate is 16% and 10%, the tax rate shall be adjusted to 13% and 9% respectively. The VAT rate of the Company and its subsidiaries has been adjusted to 13% from April 1, 2019. 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 67,591.16 126,486.63 Cash in bank 7,519,825.02 16,305,989.07 Other monetary fund 2,000,000.00 2,056,410.56 Total 9,587,416.18 18,488,886.26 Other explanation (1) 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) there is no money deposited abroad at end of the period or potentially at risk of recovery. 2. Trading financial assets In RMB Item Balance at period-end Balance at period-begin 85 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Including: Including: Other explanation: Nil 3. Derivative financial assets In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 4. Notes receivable (1) Category In RMB Item Balance at period-end Balance at period-begin Bank acceptance 180,000.00 0.00 Total 180,000.00 0.00 In RMB Balance at period-end Balance at period-begin Book balance Bad debt provision Book balance Bad debt provision Category Book Book Accrual Accrual Amount Ratio Amount value Amount Ratio Amount value ratio ratio Including: Including: Total 0.00 0.00% 0.00 0.00% 0.00 0.00 0.00% 0.00 0.00% 0.00 Bad debt provision accrual on single basis: In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes Total 0.00 0.00 -- -- Bad debt provision accrual on single basis: In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes 86 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total 0.00 0.00 -- -- Bad debt provision accrual on single basis: In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes Bad debt provision accrual on portfolio In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Total 0.00 0.00 -- Explanation on portfolio basis: Bad debt provision accrual on portfolio In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Explanation on portfolio basis: If the provision for bad debts of notes receivable is made in accordance with the general model of expected credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions: □Applicable √Not applicable (2) Bad debt provision accrual, collected or reversal in the period Accrual of bad debt provision in the period: In RMB Balance at Current changes Balance at Category period-begin Accrual Collected or reversal Charge-off period-end Total 0.00 0.00 0.00 0.00 0.00 Including important amount of bad debt provision collected or reversal in the period: □Applicable √Not applicable (3) Note receivable pledged at period-end In RMB Item Amount pledged at period-end Total 0.00 87 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (4) Note receivable which have endorsed and discount at period-end and has not expired on balance sheet date In RMB Item Amount derecognition at period-end Amount not derecognition at period-end Bank acceptance 24,200,000.00 Total 24,200,000.00 (5) Notes transfer to account receivable due for failure implementation by drawer at period-end In RMB Item Amount transfer to account receivable at period-end Total 0.00 Other explanation Nil (6) Note receivable actually charge-off in the period In RMB Item Amount charge-off Including important note receivable charge-off: In RMB Amount cause by Procedure for Enterprise Nature Amount charge-off Causes of charge-off related transactions charge-off or not (Y/N) Total -- 0.00 -- -- -- Explanation on note receivable change-off: Nil 5. Account receivable (1) Category In RMB Balance at period-end Balance at period-begin Book balance Bad debt provision Book balance Bad debt provision Category Book Accrual Accrual Book value Amount Ratio Amount value Amount Ratio Amount ratio ratio Account receivable 2,477,48 6.37% 2,099,36 84.74% 378,124.1 2,477,485 7.66% 2,099,361 84.74% 378,124.19 with bad debt 88 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 provision accrual by 5.20 1.01 9 .20 .01 single basis Including: Account receivable with bad debt 36,432,6 1,250,55 35,182,08 29,860,22 1,230,837 28,629,384. 93.63% 3.43% 92.34% 4.12% provision accrual by 35.12 4.75 0.37 2.34 .51 83 portfolio Including: 38,910,1 3,349,91 35,560,20 32,337,70 3,330,198 29,007,509. Total 100.00% 8.61% 100.00% 10.30% 20.32 5.76 4.56 7.54 .52 02 Bad debt provision accrual on single basis: Account receivable with minor single amount period-end but withdrawal bad debt provision on single basis In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes Business terminated, and Shijiazhuang Dasong 1,059,165.50 1,059,165.50 100.00% the money recovery is Tech. Co., Ltd uncertain Sichuan Wanling Electric 1,103,452.20 882,761.76 80.00% Difficult to recover Technology Co., Ltd. Shanghai Swen Electric 314,867.50 157,433.75 50.00% Difficult to recover Vehicle Co., Ltd. Total 2,477,485.20 2,099,361.01 -- -- Bad debt provision accrual on single basis: In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes Bad debt provision accrual on portfolio: Account receivable with bad debt provision accrual on aging analysis In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Within one year(one year 34,798,417.31 104,395.25 0.30% included) 1-2 years (2 years included) 488,301.90 1,464.91 0.30% 2-3 years (3 years included) 1,225.00 3.68 0.30% 3-4 years (4 years included) 89 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Over 5 years 1,144,690.91 1,144,690.91 100.00% Total 36,432,635.12 1,250,554.75 -- Explanation on portfolio basis: According to the business scale, business nature, and customers’ settlement, etc., the account receivable with single significant amount is determined to be RMB 5 million. The account receivable with single significant amount has no depreciation reserve, and the reserve for bad debt provision is withdrawn with age analysis method. Bad debt provision accrual on portfolio In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Explanation on portfolio basis: If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions: □Applicable √Not applicable By account age In RMB Account age Balance at period-end Within one year(one year included) 34,798,417.31 1-2 years 488,301.90 2-3 years 1,225.00 Over 3 years 1,144,690.91 Over 5 years 1,144,690.91 Total 36,432,635.12 (2) Bad debt provision accrual, collected or reversal in the period Accrual of bad debt provision in the period: In RMB Balance at Current changes Balance at Category period-begin Accrual Collected or reversal Charge-off period-end Aging analysis and accrual on single 3,330,198.52 39,523.02 19,805.78 3,349,915.76 basis Total 3,330,198.52 39,523.02 19,805.78 3,349,915.76 Including important amount of bad debt provision collected or reversal in the period: In RMB 90 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Enterprise Amount collected or reversal Collection way (3) Account receivables actually charge-off during the reporting period In RMB Item Amount charge-off Including major account receivables charge-off: In RMB Amount cause by Procedure for Enterprise Nature Amount charge-off Causes of charge-off related transactions charge-off or not (Y/N) Explanation on account receivable charge-off Nil (4) Top five account receivables collected by arrears party at ending balance Enterprise Relationship Amount Account age Bad debt Ratio in total Accoun with the provision account t Company receivable nature (%) Shenzhen Weiterui New Energy Non-related 8,822,791.17 Within one 26,468.37 22.68 Paymen Technology Co., Ltd. party year t for goods Jinan Yuxintai Sales Co., Ltd. Non-related 7,556,575.55 Within one 22,669.73 19.42 Paymen party year t for goods Shenzhen Jiahaosong Technology Co., Non-related 6,816,303.75 Within one 20,448.91 17.52 Paymen Ltd. party year t for goods Zhengzhou Guiguan Tech. Trade. Co., Non-related 2,458,418.00 Within one 7,375.25 6.32 Paymen Ltd party year t for goods Fu Qi Non-related 2,285,670.40 Within two 6,857.01 5.87 Paymen party years t for goods Total 27,939,758.87 83,819.27 71.81 (5) Account receivable derecognition due to transfer of financial assets Nil 91 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (6) Assets and liability resulted by account receivable transfer and continuous involvement Nil Other explanation: At end of the period, there was no account receivable from shareholder unit and other related parties that holds 5% (included) voting rights of the Company among Account Receivables 6. Receivables financing In RMB Item Balance at period-end Balance at period-begin Change of receivables financing and fair value in the period □Applicable √Not applicable If the provision for bad debts of receivable financing is made in accordance with the general model of expected credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions: □Applicable √Not applicable Other explanation: Nil 7. Account paid in advance (1) By account age In RMB Balance at period-end Balance at period-begin Account age Amount Ratio Amount Ratio Within one year 5,139,379.30 100.00% 13,799,753.60 100.00% Total 5,139,379.30 -- 13,799,753.60 -- 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 Enterprise Relationship Amount Account age Ratio in total with the Nature advance e Company payment (%) Zhaoqing Kaisite Battery Material Non-related 4,502,078.18 Within one Prepayments for 87.60 Co., Ltd. party year raw materials Shenzhen OZM Decoration Design Non-related 636,000.00 Within one Prepayments for 12.38 Engineering Co., Ltd. party year decoration Shenzhen JFM Package Material Co., Non-related 1,301.12 Within one Prepayments for 0.02 92 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Ltd. party year raw materials Total 5,139,379.30 100.00 Other explanation: At end of the period, there was no advance payment from shareholder unit and other related parties that holds 5% (included) voting rights of the Company among Advance Payment 8. Other account receivable In RMB Item Balance at period-end Balance at period-begin Other account receivable 765,634.71 844,537.19 Total 765,634.71 844,537.19 (1) Interest receivable 1) Category In RMB Item Balance at period-end Balance at period-begin 2) Important overdue interest In RMB Impairment (Y/N) and Borrower Balance at period-end Overdue time Overdue reason judgment basis Total 0.00 -- -- -- Other explanation: Nil 3) Accrual of bad debt provision □Applicable √Not applicable (2) Dividend receivable 1) Category In RMB Item(or invested company) Balance at period-end Balance at period-begin 2) Important dividend receivable with over one year aged In RMB Item(or invested Balance at period-end Account age Causes of failure for Impairment (Y/N) and 93 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 company) collection judgment basis Total 0.00 -- -- -- 3) Accrual of bad debt provision □Applicable √Not applicable Other explanation: Nil (3) Other account receivable 1) By nature In RMB Account nature Book balance at period-end Book balance at period-begin Deposit or margin 721,672.00 783,672.00 Payment for equipment 311,400.00 311,400.00 Personal loan of employees 88,098.50 31,098.50 Other 129,610.55 205,750.45 Total 1,250,781.05 1,331,920.95 2) Accrual of bad debt provision In RMB Phase I Phase II Phase III Expected credit Expected credit losses for Expected credit losses for Bad debt provision Total losses over next 12 the entire duration (without the entire duration (with months credit impairment occurred) credit impairment occurred) Balance of Jan. 1, 2019 —— —— —— —— in the period Change of book balance of loss provision with amount has major changes in the period □Applicable √Not applicable By account age In RMB Account age Balance at period-end Within one year(one year included) 545,238.53 1-2 years 181,000.00 2-3 years 41,700.00 Over 3 years 482,842.52 3-4 years 13,943.00 4-5 years 20,164.00 Over 5 years 448,735.52 94 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total 1,250,781.05 3) Bad debt provision accrual, collected or reversal in the period Accrual of bad debt provision in the period: In RMB Current changes Category Balance at period-begin Balance at period-end Accrual Collected or reversal Aging analysis 487,383.76 2,237.42 485,146.34 Total 487,383.76 2,237.42 485,146.34 Nil Important amount of bad debt provision switch-back or collection in the period: In RMB Enterprise Amount switch-back or collection Collection way Total 0.00 -- Nil 4) Other account receivables actually charge-off during the reporting period In RMB Item Amount charge-off Including major other account receivables charge-off: In RMB Amount cause by Procedure for Enterprise Nature Amount charge-off Causes of charge-off related transactions charge-off or not (Y/N) Total -- 0.00 -- -- -- Other Explanation on account receivable charge-off Nil 5) Top 5 other account receivable collected by arrears party at ending balance In RMB Proportion in total Balance at other account Ending balance of Enterprise Nature Account age period-end receivables at bad debt provision period-end Shenzhen Luwei Payment for Mechatronic 300,000.00 Over 5 years 23.95% 300,000.00 equipment Equipment Co., Ltd Shenzhen Anjingheng Deposit and margin 266,000.00 Within one year 21.23% 798.00 Industrial Co., Ltd. Shenzhen Material Deposit and margin 181,918.00 Within one year 14.52% 545.75 95 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Group Co., Ltd. Alipay (China) Network Technology Deposit and margin 110,000.00 Within two years 8.78% 330.00 Co., Ltd. Guangzhou Vipshop Deposit and margin 50,000.00 Within two years 3.99% 150.00 E-Business Co., Ltd. Total -- 907,918.00 -- 72.47% 301,823.75 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 9. Inventory Whether implemented the new revenue standards □Yes √No (1) Category 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 329,937.29 23,015.17 306,922.12 388,818.51 23,015.17 365,803.34 Finished goods 3,094,478.81 321,016.86 2,773,461.95 2,382,433.75 361,633.15 2,020,800.60 Total 3,424,416.10 344,032.03 3,080,384.07 2,771,252.26 384,648.32 2,386,603.94 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 96 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (2) Inventory depreciation reserve In RMB Current increased Current decreased Balance at Balance at Item Switch back or period-begin Accrual Other Other period-end charge-off Raw materials 23,015.17 23,015.17 Finished goods 361,633.15 40,616.29 321,016.86 Total 384,648.32 40,616.29 344,032.03 Nil (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: 10. Contract assets In RMB Balance at period-end Balance at period-begin Item Impairment Impairment Book balance Book value Book balance Book value provision provision Book value of contract assets have major changes and causes: In RMB Item Amount changes Causes If the provision for bad debts of contract asset is made in accordance with the general model of expected credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions: □Applicable √Not applicable Accrual of impairment provision in the period In RMB Reversal/Charge-off in Item Accrual in the period Switch-back in the period Causes the period Other explanation: Nil 97 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 11. Assets held for sale In RMB Book balance at Impairment Ending book Expected disposal Expected disposal Item Fair value period-end provision value expenses time Other explanation: Nil 12. Non-current asset due within one year In RMB Item Balance at period-end Balance at period-begin Important creditors’ investment/Other creditors’ investment In RMB Balance at period-end Balance at period-begin Creditor's rights Face value Coupon rate Actual rate Due date Face value Coupon rate Actual rate Due date Other explanation: Nil 13. Other current assets Whether implemented the new revenue standards □Yes √No In RMB Item Balance at period-end Balance at period-begin Prepaid intermediary fee 1,792,452.81 1,792,452.81 Prepaid tax 2,817,406.12 473,788.85 Total 4,609,858.93 2,266,241.66 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. 14. Creditors’ investment In RMB Balance at period-end Balance at period-begin Item Impairment Impairment Book balance Book value Book balance Book value provision provision Important creditors’ investment 98 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 In RMB Balance at period-end Balance at period-begin Creditor's rights Face value Coupon rate Actual rate Due date Face value Coupon rate Actual rate Due date Accrual of impairment provision In RMB Phase I Phase II Phase III Expected credit Expected credit losses for Expected credit losses for Bad debt provision Total losses over next 12 the entire duration (without the entire duration (with months credit impairment occurred) credit impairment occurred) Balance of Jan. 1, 2019 —— —— —— —— in the period Change of book balance of loss provision with amount has major changes in the period □Applicable √Not applicable Other explanation: Nil 15. Other creditors’ investment In RMB Cumulative loss Change of Cumulative impairment Balance at Accrued Balance at Item fair value in Cost changes of recognized in Note period-begin interest period-end the period fair value other comprehensi ve income Important other creditors’ investment In RMB Other creditors’ Balance at period-end Balance at period-begin investment Face value Coupon rate Actual rate Due date Face value Coupon rate Actual rate Due date Accrual of impairment provision In RMB Phase I Phase II Phase III Expected credit Expected credit losses for Expected credit losses for Bad debt provision Total losses over next 12 the entire duration (without the entire duration (with months credit impairment occurred) credit impairment occurred) Balance of Jan. 1, 2019 —— —— —— —— in the period 99 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Change of book balance of loss provision with amount has major changes in the period □Applicable √Not applicable Other explanation: Nil 16. Long-term account receivable (1) Long-term account receivable In RMB Balance at period-end Balance at period-begin Discount rate Item Bad debt Bad debt Book balance Book value Book balance Book value interval provision provision Impairment of bad debt provision In RMB Phase I Phase II Phase III Expected credit Expected credit losses for Expected credit losses for Bad debt provision Total losses over next 12 the entire duration (without the entire duration (with months credit impairment occurred) credit impairment occurred) Balance of Jan. 1, 2019 —— —— —— —— in the period Change of book balance of loss provision with amount has major changes in the period □Applicable √Not applicable Nil (2) Long-term account receivable derecognized due to financial assets transfer Nil (3) Assets and liabilities resulted by long-term account receivable transfer and continues involvement Nil Other explanation Nil 17. Long-term equity investments In RMB The Balance Changes in the period (+,-) Balance Ending invested at Additiona Capital Investme Other Other Cash Accrual at balance Other entity period-be l reduction nt gains comprehe equity dividend of period-en of 100 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 gin(Book investmen recognize nsive change or profit impairme d(Book impairme value) t d under income announce nt value) nt equity adjustmen d to provision provision t issued I. Joint venture II. Associated enterprise Other explanation Nil 18. Other equity instrument investment In RMB Item Balance at period-end Balance at period-begin Itemized the non-tradable equity instrument investment in the period In RMB Causes of those that designated Retained earnings measured by fair Cause of retained transfer from value and with its earnings transfer Dividend income Cumulative Item Cumulative gains other variation from other recognized losses comprehensive reckoned into comprehensive income other income comprehensive income Other explanation: Nil 19. Other non-current financial assets In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 20. Investment real estate (1) Investment real estate measured at cost □Applicable √Not applicable 101 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 21. Fixed assets In RMB Item Balance at period-end Balance at period-begin Fixed assets 3,333,489.56 3,502,807.32 Total 3,333,489.56 3,502,807.32 (1) Fixed assets In RMB Housing and Machinery Means of Electronic Item Total buildings equipment transportation equipment 及 Other I. original book value: 1.Balance at 2,959,824.00 416,629.06 958,593.21 225,888.32 4,560,934.59 period-begin 2.Current increased (1) Purchase 16,814.16 (2) construction in process transfer-in (3) the increase in business combination 3.Current decreased (1)Disposal or 102 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 scrap 4.Balance at 2,959,824.00 433,443.22 958,593.21 225,888.32 4,577,748.75 period-end II. accumulated depreciation 1.Balance at 332,980.20 146,742.76 442,326.93 136,077.38 1,058,127.27 period-begin 2.Current 66,596.04 19,000.54 86,273.40 14,261.94 186,131.92 increased (1) Accrual 66,596.04 19,000.54 86,273.40 14,261.94 186,131.92 3.Current decreased (1)Disposal or scrap 4.Balance at 399,576.24 165,743.30 528,600.33 150,339.32 1,244,259.19 period-end III. Impairment provision 1.Balance at period-begin 2.Current increased (1) Accrual 3.Current decreased (1)Disposal or scrap 4.Balance at period-end IV. Book value 1.Ending book 2,560,247.76 267,699.92 429,992.88 75,549.00 3,333,489.56 value 103 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 2.Opening book 2,626,843.80 269,886.30 516,266.28 89,810.94 3,502,807.32 value (2) Fixed assets temporary idle In RMB Accumulated Impairment Item Original book value Book value Note depreciation provision (3) Fixed assets leasing-in by financing lease In RMB Accumulated Item Original book value Impairment provision Book value depreciation (4) Fixed assets leasing-out by operational 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 (7-20F) 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 2,560,247.76 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 Nil 104 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (6) Fixed assets disposal In RMB Item Balance at period-end Balance at period-begin Other explanation Nil 22. 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 Impairment Impairment Book balance Book value Book balance Book value provision provision (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 (3) Depreciation reserves accrual In RMB Item Accrual in the period Reasons for accrual Other explanation Nil (4) Engineering materials In RMB Item Balance at period-end Balance at period-begin 105 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Impairment Impairment Book balance Book value Book balance Book value provision provision Other explanation: Nil 23. Productive biological asset (1) Productive biological assets measured by cost □Applicable √Not applicable (2) Productive biological assets measured by fair value □Applicable √Not applicable 24. Oil and gas asset □Applicable √Not applicable 25. Right-of-use asset In RMB Item Total Other explanation: Nil 26. 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 increased (1) Purchase (2) internal R 106 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 &D (3) the increase in business combination 3.Current decreased (1) Disposal 4.Balance at 5,271,000.00 5,271,000.00 period-end II. accumulated depreciation 1.Balance at 3,765,000.00 3,765,000.00 period-begin 2.Current 376,500.00 376,500.00 increased (1) Accrual 376,500.00 376,500.00 3.Current decreased (1) Disposal 4.Balance at 4,141,500.00 4,141,500.00 period-end III. Impairment provision 1.Balance at period-begin 2.Current increased (1) Accrual 3.Current decreased (1) Disposal 107 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 4.Balance at period-end IV. Book value 1.Ending book 1,129,500.00 1,129,500.00 value 2.Opening book 1,506,000.00 1,506,000.00 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 27. Expense on Research and Development In RMB Balance at Balance at Item Current increased Current decreased period-begin period-end Other explanation Nil 28. Goodwill (1) Original book value of goodwill In RMB The invested Balance at Balance at Current increased Current decreased entity or items period-begin period-end (2) Impairment provision of goodwill In RMB The invested Balance at Balance at Current increased Current decreased entity or items period-begin period-end 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, 108 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 29. Long-term expenses to be apportioned In RMB Balance at Amortized in the Balance at Item Current increased Other decrease period-begin Period period-end Other explanation Nil 30. Deferred income tax assets/Deferred income tax liabilities (1) Deferred income tax assets without 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 Impairment provision of 4,179,094.13 1,044,773.54 4,162,484.72 1,040,621.18 assets Total 4,179,094.13 1,044,773.54 4,162,484.72 1,040,621.18 (2) Deferred income tax liabilities without 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 (3) Deferred income tax assets and deferred income tax liabilities listed after off-set In RMB Trade-off between the Ending balance of Trade-off between the Opening balance of Item deferred income tax deferred income tax deferred income tax deferred income tax assets and liabilities assets or liabilities after assets and liabilities at assets or liabilities after 109 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 off-set period-begin off-set Deferred income tax 1,044,773.54 assets (4) Details of unrecognized deferred income tax assets In RMB Item Balance at period-end Balance at period-begin (5) Deductible losses of un-recognized deferred income tax assets expired on the followed year In RMB Year Ending amount Opening amount Note 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. 31. Other non-current assets Whether implemented the new revenue standards □Yes √No 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: Up to 30th June 2019, the houses for enterprise talent located in Luohu District has not yet been delivered by Shenzhen Housing and Construction Bureau of Luohu District. 32. Short-term loans (1) Category In RMB Item Balance at period-end Balance at period-begin Explanation on short-term loans category: Nil 110 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 Other explanation: Nil 33. Trading financial liability In RMB Item Balance at period-end Balance at period-begin Including: Including: Other explanation: Nil 34. Derivative financial liability In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 35. Notes payable In RMB Category Balance at period-end Balance at period-begin Bank acceptance 2,000,000.00 2,000,000.00 Total 2,000,000.00 2,000,000.00 Notes expired at period-end without paid was 0.00 Yuan. 36. Account payable (1) Account payable In RMB Item Balance at period-end Balance at period-begin Within one year(one year included) 6,810,356.07 9,713,137.52 111 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 1-2 years (2 years included) 7,099.50 7,099.50 2-3 years (3 years included) 137,423.41 137,423.41 3-4 years (4 years included) 2,366.00 2,366.00 Over 5 years 118,984.26 118,984.26 Total 7,076,229.24 9,979,010.69 (2) Important account payable with account age over one year In RMB Item Balance at period-end Reasons of un-paid or carry-over Other explanation: Nil 37. Account received in advance Whether implemented the new revenue standards □Yes √No (1) Account received in advance In RMB Item Balance at period-end Balance at period-begin Within one year(one year included) 1,585,651.60 371,039.28 1-2 years (2 years included) 3,469.60 3,469.60 2-3 years (3 years included) 2,080.00 2,080.00 Over 3 years 29,191.00 29,191.00 Total 1,620,392.20 405,779.88 (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 (3) Projects that settle without completed from construction contract at period-end In RMB Item Amount Other explanation: Nil 112 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 38. Contract liability In RMB Item Balance at period-end Balance at period-begin Book value has major changes in the period and causes In RMB Item Amount changes Causes 39. Wage payable (1) Wage payable In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end I. Short-term 435,736.16 2,823,763.18 2,719,977.39 539,521.95 compensation II. Post-employment benefit-Defined 207,279.90 207,279.90 contribution plan Total 435,736.16 3,031,043.08 2,927,257.29 539,521.95 (2) Short-term compensation In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end 1. Wages, bonus, 428,742.32 2,475,459.98 2,371,459.98 532,742.32 allowances and subsidy 3. Social insurance 94,453.52 94,453.52 Including: Medical 82,516.16 82,516.16 insurance Work injury 5,386.86 5,386.86 insurance Maternity 6,550.50 6,550.50 insurance 4. Housing accumulation 207,218.72 207,218.72 fund 5. Labor union expenditure and 6,993.84 41,230.96 41,445.17 6,779.63 personnel education expense 113 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Other short-term 5,400.00 5,400.00 compensation Total 435,736.16 2,823,763.18 2,719,977.39 539,521.95 (3) Defined contribution plan In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end 1. Basic endowment 201,559.48 201,559.48 insurance 2. Unemployment 5,720.42 5,720.42 insurance Total 207,279.90 207,279.90 Other explanation: Nil 40. Taxes payable In RMB Item Balance at period-end Balance at period-begin Value added tax 5,716,531.88 Individual income tax 20,597.95 25,288.27 Tax for maintaining and building cities 4,511.47 325,396.78 Property tax 90,141.20 Educational surtax 3,184.85 227,569.65 Stamp tax 2,125.70 2,309.70 Total 120,561.17 6,297,096.28 Other explanation: Nil 41. Other account payable In RMB Item Balance at period-end Balance at period-begin Other account payable 37,583,929.90 37,144,872.42 Total 37,583,929.90 37,144,872.42 114 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (1) Interest payable In RMB Item Balance at period-end Balance at period-begin Important interest overdue without paid: In RMB Borrower Amount overdue Overdue reason 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) By nature In RMB Item Balance at period-end Balance at period-begin Custodian and common benefit debts 18,691,592.20 18,853,692.84 Intercourse funds 6,500,000.00 6,500,000.00 Warranty and guarantee money 10,626,764.76 9,767,553.26 Other payable service charge(intermediary 801,237.74 801,237.74 services included) Other 964,335.20 1,222,388.58 Total 37,583,929.90 37,144,872.42 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 18,691,592.20 - Warranty and guarantee money 8,000,000.00 Performance bond Shenzhen Guosheng Energy Investment 6,500,000.00 Interest-free loans Development Co., Ltd. Total 33,191,592.20 -- Other explanation 115 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Nil 42. Liability held for sale In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 43. Non-current liabilities due within one year In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 44. Other current liabilities Whether implemented the new revenue standards □Yes √No In RMB Item Balance at period-end Balance at period-begin Changes of short-term bond payable: In RMB Accrual Premium/ Balance Face Release Bond Issuing Opening Issued in interest discount Paid in at Bond value date period amount balance the Period by face amortizati the Period period-en value on d Other explanation: Nil 45. Long-term loans (1) category In RMB Item Balance at period-end Balance at period-begin Explanation on category of long-term loans: Nil Other explanation, including interest rate section: Nil 116 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 46. 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 (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 increased Current decreased Period-end financial Amount Book value Amount Book value Amount Book value Amount Book value instrument Basis for financial liability classification for other financial instrument Nil Other explanation Nil 47. Lease liability In RMB Item Balance at period-end Balance at period-begin Other explanation Nil 48. Long-term account payable In RMB Item Balance at period-end Balance at period-begin 117 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (1) By nature In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil (2) Special payable In RMB Balance at Balance at Item Current increased Current decreased Causes of formation period-begin period-end Other explanation: Nil 49. 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 118 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 50. Accrual liability Whether implemented the new revenue standards □Yes √No In RMB Item Balance at period-end Balance at period-begin Causes of formation Other explanation, including relevant important assumptions and estimation: Nil 51. Deferred income In RMB Balance at Balance at Item Current increased Current decreased Causes of formation period-begin period-end Item with government grants involved: In RMB Amount Amount Cost Assets-relate Balance at New grants reckoned in Other Balance at Liability reckoned in reduction in d/income period-begin in the Period non-operatio changes period-end other income the period related n revenue Other explanation: Nil 52. Other non-current liabilities Whether implemented the new revenue standards □Yes √No In RMB Item Balance at period-end Balance at period-begin Other explanation: Nil 53. Share capital In RMB Changes in the period (+,-) Shares Balance at Balance at New shares transferred period-begin Bonus share Other Subtotal period-end issued from capital reserve 119 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total shares 551,347,947.00 0.00 551,347,947.00 Other explanation: Nil 54. 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 increased Current decreased Period-end financial Amount Book value Amount Book value Amount Book value Amount Book value instrument Changes of other equity instrument, change reasons and relevant accounting treatment basis: Nil Other explanation: Nil 55. Capital public reserve In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end Other capital reserve 627,834,297.85 627,834,297.85 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. 56. Treasury stock In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end Other explanation, including changes and reasons for changes: Nil 120 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 57.Other comprehensive income In RMB Current Period Less: Less: written written in in other other comprehensi comprehe ve income in nsive Account Balance Balance at previous income in Belong to Belong to before at Item period-begi period and previous Less : income parent minority income tax period-e n carried period and tax expense company shareholders in the nd forward to carried after tax after tax period gains and forward to losses in retained current earnings in period current period Other explanation, including the active part of the hedging gains/losses of cash flow transfer to initial recognition adjustment for the arbitraged items: Nil 58. Reasonable reserve In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end Other explanation, including changes and reasons for changes: Nil 59. Surplus public reserve In RMB Item Balance at period-begin Current increased Current decreased Balance at period-end Statutory surplus 32,673,227.01 32,673,227.01 reserves Total 32,673,227.01 32,673,227.01 Other explanation, including changes and reasons for changes: Nil 60. Retained profit In RMB 121 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Item Current period Last Period Retained profit at period-end before adjustment -1,197,549,169.92 -1,195,957,201.01 Retained profit at period-begin after adjustment -1,197,549,169.92 -1,195,957,201.01 Add: net profit attributable to shareholders of -798.946.17 -1,591,968.91 parent company for this year Retained profit at period-end -1,198,348,116.09 -1,197,549,169.92 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 61. Operation revenue and operation cost In RMB Current Period Last Period Item Revenue Cost Revenue Cost Main business 33,834,135.17 32,088,349.25 63,664,151.78 59,106,390.80 Other business 4,440,297.85 3,241,165.72 4,070,747.57 2,057,815.53 Total 38,274,433.02 35,329,514.97 67,734,899.35 61,164,206.33 Whether implemented the new revenue standards □Yes √No Other explanation Nil 62. Tax and extras In RMB Item Current Period Last Period Tax for maintaining and building cities 10,738.55 29,269.66 Educational surtax 8,298.22 20,906.89 Stamp tax 17,551.00 25,561.20 Total 36,587.77 75,737.75 Other explanation: Nil 122 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 63. Sales expenses In RMB Item Current Period Last Period Employee compensation 946,503.40 1,532,803.51 Business travel expenses 189,953.21 192,454.31 Lease fee 300,492.89 188,033.90 Sales expenses on internet 246,947.49 535,515.52 Other 191,826.62 307,120.29 Total 1,875,723.61 2,755,927.53 Other explanation: Nil 64. Administrative expenses In RMB Item Current Period Last Period Salary, social insurance 1,941,131.64 1,828,693.52 Other 418,252.20 1,481,026.72 Total 2,359,383.84 3,309,720.24 Other explanation: Nil 65. R&D expenses In RMB Item Current Period Last Period Other explanation: Nil 66. Financial expenses In RMB Item Current Period Last Period Interest expenses Less: Interest income 71,134.40 272,686.20 Exchange loss Commission charge etc. 10,681.41 11,710.39 123 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total -60,452.99 -260,975.81 Other explanation: Nil 67. Other income In RMB Sources Current Period Last Period 68. Investment income In RMB Item Current Period Last Period Other explanation: Nil 69. Net exposure hedge gains In RMB Item Current Period Last Period Other explanation: Nil 70. Income from change of fair value In RMB Sources Current Period Last Period Other explanation: Nil 71. Credit impairment loss In RMB Item Current Period Last Period Bad debt loss of other account receivable 2,237.42 -10.25 Bad debt loss of long-term account -19,717.24 -7,208.95 receivable Total -17,479.82 -7,219.20 Other explanation: Nil 124 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 72. Losses of devaluation of asset Whether implemented the new revenue standards □Yes √No In RMB Item Current Period Last Period II. Inventory falling price loss 40,616.29 Total 40,616.29 Other explanation: Nil 73. Income from assets disposal In RMB Sources Current Period Last Period 74. Non-operating income In RMB Amount reckoned in current Item Current Period Last Period non-recurring gains/losses Other 148,627.00 72,126.28 Total 148,627.00 72,126.28 Government grants reckoned into current gains/losses: In RMB Subsidy impact The special Assets-relate Government Issuing Offering Amount in Amount in Nature current subsidy d/income-rela grants subject causes the Period last period gains/losses (Y/N) ted (Y/N) Other explanation: Nil 75. Non-operating expenses In RMB Amount reckoned in current Item Current Period Last Period non-recurring gains/losses Other 50.00 30,140.00 125 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total 50.00 30,140.00 Other explanation: Nil 76. Income tax expenses (1) Income tax expenses In RMB Item Current Period Last Period Current income tax expense 233,133.98 Deferred income tax expense -4,152.36 Total -4,152.36 233,133.98 (2) Adjustment on accounting profit and income tax expenses In RMB Item Current Period Total Profit -1,094,610.71 Income tax measured by statutory/applicable tax rate -273,652.68 Impact on deductible temporary differences or losses deductible 269,500.32 which was un-recognized as deferred income tax assets Income tax expenses -4,152.36 Other explanation Nil 77. Other comprehensive income Found more in Note 57 78. 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. 2,583,334.70 1,673,601.27 Other intercourse funds 1,323,261.33 855,411.09 Total 3,906,596.03 2,529,012.36 Explanation on other cash received in relation to operation activities: 126 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Nil (2) Other cash paid in relation to operation activities In RMB Item Current Period Last Period Period expenses, operation development 5,809,899.76 4,714,582.54 and common benefit debts etc. paid Total 5,809,899.76 4,714,582.54 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 Bill margin received 2,016,600.82 Total 2,016,600.82 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 2,000,000.00 127 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Total 2,000,000.00 Explanation on cash paid related with financing activities: Nil 79. 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 -1,090,458.35 491,916.41 Add: Impairment provision of assets -23,136.47 7,219.20 Depreciation of fixed assets, consumption of oil assets and depreciation of productive 186,131.92 184,546.75 biology assets Depreciation of right-of-use asset 376,500.00 376,500.00 Decrease of deferred income tax -4,152.36 asset( (increase is listed with “-”) Decrease of inventory (increase is listed with -693,780.13 -2,033,200.69 “-”) Decrease of operating receivable accounts -2,006,581.24 -5,809,570.61 (increase is listed with “-”) Increase of operating payable accounts -5,645,780.11 3,419,617.75 (decrease is listed with “-”) Net cash flow from operation activities -8,901,256.74 -3,362,971.19 2. Material investment and financing not -- -- involved in cash flow 3. Net change of cash and cash equivalents: -- -- Balance of cash at period-end 7,587,416.18 15,814,304.99 Less: Balance of cash at period-begin 16,488,886.26 19,177,276.18 Net increased amount of cash and cash -8,901,470.08 -3,362,971.19 equivalent (2)Net cash paid for obtaining subsidiary in the Period In RMB Amount 128 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 I. Cash 7,587,416.18 16,488,886.26 Including: Cash on hand 67,591.16 126,486.63 Bank deposit available for payment 7,519,825.02 16,305,989.07 at any time Other monetary fund available for 56,410.56 payment at any time Ⅲ. Balance of cash and cash equivalent at 7,587,416.18 16,488,886.26 period-end Other explanation: Nil 80. Notes of changes of owners’ equity Explain the name and adjusted amount in “Other” at end of last period: Nil 81. Assets with ownership or use right restricted In RMB 129 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Item Ending book value Restriction reasons Margin of 2,000,000.00 yuan for bank Monetary fund 2,000,000.00 acceptance bill The six houses for talents in Lianxin Garden without the property certificate, Fixed asset 2,560,247.76 and can no be traded with any party except the government Total 4,560,247.76 -- Other explanation: Nil 82. 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 130 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 83. Hedging Disclosed hedging items and relevant hedging instrument based on hedging’s category, disclosed qualitative and quantitative information for the arbitrage risks: Nil 84. Government grants (1) Government grants In RMB Amount reckoned into current Category Amount Item gains/losses (2) Government grants rebate □Applicable √Not applicable Other explanation: Nil 85. 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: 131 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Nil (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 132 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 combined Combination determine the party during party during obtained in of of party 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 Combination 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 133 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 Emmelle Sales of bicycles Shenzhen Shenzhen 70.00% Investment Industrial Co., and spare parts 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 134 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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% -291,512.18 2,382,650.62 Industrial 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 Emmelle 20,516,1 1,487,17 22,003,3 14,061,1 14,061,1 29,791,5 1,548,02 31,339,5 22,425,6 22,425,6 Industria 77.08 9.64 56.72 87.97 87.97 25.49 1.02 46.51 70.50 70.50 l Co., Ltd. In RMB Current Period Last Period Cash flow Cash flow Total Total Subsidiary Operation from Operation from Net profit comprehensi Net profit comprehensi revenue operation revenue operation ve income ve income activity activity Shenzhen Emmelle 13,212,224.3 44,367,011.1 -971,707.26 -971,707.26 -4,193,347.24 -207,485.52 -207,485.52 1,114,664.36 Industrial 4 8 Co., Ltd. Other explanation: Nil 135 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 (2) Impact on minority’s interest and owners’ equity attributable to parent company In RMB Other explanation 3. Equity in joint venture and associated enterprise (1)Important joint venture or associated enterprise Joint venture or Share-holding ratio Main operation Accounting associated Registered place Business nature place Directly Indirectly treatment enterprise Share-holding ratio or shares enjoyed different from voting right ratio: 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: (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 (3) Main financial information of the important associated enterprise In RMB 136 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Balance at period-end/Current Period Balance at period-begin/Last Period Other explanation (4) Financial summary for un-important joint venture or associated enterprise In RMB Balance at period-end/Current Period Balance at period-begin/Last Period Joint venture: -- -- Total numbers measured by share-holding -- -- ratio Associated enterprise: -- -- Total numbers measured by share-holding -- -- ratio Other explanation (5) Assets transfer ability has major restriction from joint venture or associated enterprise (6) Excess losses from joint venture or associated enterprise In RMB Un-confirmed losses not Joint venture or associated Cumulative un-confirmed Cumulative un-confirmed recognized in the Period (or net enterprise losses losses at period-end profit enjoyed in the Period) Other explanation (7) Un-confirmed commitment with investment concerned with joint venture (8) Contingent liability with investment concerned with joint venture or associated enterprise 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: If the co-runs entity is the separate entity, basis of the co-runs classification Other explanation 5. Equity in structuring entity that excluding in the consolidated financial statement Relevant explanation 137 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 6. Other 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 138 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 30th June 2019, the gearing ratio of the Company was 75.49% (31 December 2018: 76.82%) 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 139 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 Registered 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-1 140 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 3. Associated enterprise and joint venture Found more in Note IX-3 Other associated enterprise and joint venture that have related transaction with the Company in the Period or occurred in previous period Joint venture or associated enterprise Relationship with the Company Other explanation Nil 4. Other related party Other related party Relationship with the Company 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 Period 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 15,683.10 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 Client/ Entrusting party/ Assets type Starting date Maturity date Yield pricing Income from 141 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 contract-out party contractor basis trusteeship/contra 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 Nil 142 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (5) Borrowed funds of related party In RMB Related party Borrowed funds Starting date Due 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 818,870.00 1,258,900.00 (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 debt provision Book balance Bad debt provision (2) Payable item In RMB Item Related party Book balance at period-end Book balance at period-begin Shenzhen Huahui Tongda Account received in advance 5,439.00 Industrial Co., Ltd. Shenzhen Guosheng Energy Other account payable Investment Development Co., 6,500,000.00 6,500,000.00 Ltd. 143 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 There is no share-based payment occurred in the reporting period 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 144 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 145 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 assets and total liability for reportable segments, explain reasons Nil 146 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (4) Other explanation Nil 7. Major transaction and events makes influence on investor’s decision Nil 8. Other Nil XVII. Principle notes of financial statements of parent company 1. Account receivable (1) By category In RMB Balance at period-end Balance at period-begin Book balance Bad debt provision Book balance Bad debt provision Category Book Accrual Accrual Book value Amount Ratio Amount value Amount Ratio Amount ratio ratio Including: Account receivable with bad debt 26,040,8 78,122.6 25,962,77 12,866,55 12,827,954. 100.00% 0.30% 100.00% 38,599.66 0.30% provision accrual by 94.92 8 2.24 3.82 16 portfolio Including: 26,040,8 78,122.6 25,962,77 12,866,55 12,827,954. Total 100.00% 0.30% 100.00% 38,599.66 0.30% 94.92 8 2.24 3.82 16 Bad debt provision accrual on single basis: In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Accrual causes Bad debt provision accrual on portfolio 39523.02 Yuan In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Within one year(one year 26,040,894.92 78,122.68 0.30% 147 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 included) Total 26,040,894.92 78,122.68 -- Explanation on portfolio basis: Nil Bad debt provision accrual on portfolio In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Explanation on portfolio basis: Nil Bad debt provision accrual on portfolio In RMB Balance at period-end Name Book balance Bad debt provision Accrual ratio Explanation on portfolio basis: If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions: □Applicable √Not applicable By account age In RMB Account age Balance at period-end Within one year(one year included) 26,040,894.92 Total 26,040,894.92 (2) Bad debt provision accrual, collected or reversal in the period Accrual of bad debt provision in the period: In RMB Balance at Current changes Balance at Category period-begin Accrual Collected or reversal Charge-off period-end Aging analysis 38,599.66 39,523.02 78,122.68 Total 38,599.66 39,523.02 0.00 0.00 78,122.68 Including important amount of bad debt provision collected or reversal in the period: In RMB Enterprise Amount collected or reversal Collection way Total 0.00 -- 148 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Nil (3) Account receivable actually charge-off in the period In RMB Item Amount charge-off Including major account receivables charge-off: In RMB Amount cause by Procedure for Enterprise Nature Amount charge-off Causes of charge-off related transactions charge-off or not (Y/N) Total -- 0.00 -- -- -- Explanation on account receivable charge-off Nil (4) Top five account receivables collected by arrears party at ending balance Enterprise Relationship Amount Account Bad debt Ratio in total Accoun with the age provision account t Company receivable (%) nature Shenzhen Weiterui New Energy Non-related 8,822,791.17 Within one 26,468.37 33.88 Paymen Technology Co., Ltd. party year t for goods Shenzhen Jiahaosong Technology Co., Non-related 6,816,303.75 Within one 20,448.91 26.18 Paymen Ltd. party year t for goods Jinan Yuxintai Sales Co., Ltd. Non-related 3,306,982.00 Within one 9,920.95 12.70 Paymen party year t for goods Zhengzhou Guiguan Tech. Trade. Co., Non-related 2,458,418.00 Within one 7,375.25 9.44 Paymen Ltd party year t for goods Guangdong Xinlingjia New Energy Non-related 1,853,000.00 Within one 5,559.00 7.12 Paymen Co., Ltd. party year t for goods Total 23,257,494.92 69,772.48 89.32 (5) Account receivable derecognition due to transfer of financial assets Nil 149 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (6) Assets and liability resulted by account receivable transfer and continuous involvement Nil Other explanation: Nil 2. Other account receivable In RMB Item Balance at period-end Balance at period-begin Interest receivable 0.00 Other account receivable 380,925.78 380,925.78 Total 380,925.78 380,925.78 (1) Interest receivable 1) Category In RMB Item Balance at period-end Balance at period-begin Time deposit 0.00 0.00 Entrust loans 0.00 0.00 Bond investment 0.00 0.00 Total 0.00 2) Important overdue interest Impairment (Y/N) and Borrower Balance at period-end Overdue time Overdue reason judgment basis Total 0.00 -- -- -- Other explanation: Nil 3) Accrual of bad debt provision □Applicable √Not applicable (2) Dividend receivable 1) Category In RMB Item(or invested company) Balance at period-end Balance at period-begin 2) Important dividend receivable with over one year aged In RMB 150 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Item(or invested Causes of failure for Impairment (Y/N) and Balance at period-end Account age company) collection judgment basis 3) Accrual of bad debt provision □Applicable √Not applicable Other explanation: Nil (3) Other account receivable 1) By account nature In RMB Account nature Book balance at period-end Book balance at period-begin Account receivable with bad debt provision accrual by portfolio according 382,072.00 382,072.00 to credit risk characteristics (Aging analysis ) Total 382,072.00 382,072.00 2) Accrual of bad debt provision In RMB Phase I Phase II Phase III Expected credit Expected credit losses for Expected credit losses for Bad debt provision Total losses over next 12 the entire duration (without the entire duration (with months credit impairment occurred) credit impairment occurred) Balance of Jan. 1, 2019 —— —— —— —— in the period Change of book balance of loss provision with amount has major changes in the period □Applicable √Not applicable By account age In RMB Account age Balance at period-end Within one year(one year included) 370,172.00 1-2 years 200.00 2-3 years 11,700.00 Total 382,072.00 3) Bad debt provision accrual, collected or reversal in the period Accrual of bad debt provision in the period: In RMB Category Balance at period-begin Current changes Balance at period-end 151 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Accrual Collected or reversal Nil Important amount of bad debt provision switch-back or collection in the period: In RMB Enterprise Amount switch-back or collection Collection way Nil 4) Other account receivables actually charge-off during the reporting period In RMB Item Amount charge-off Including major other account receivables charge-off: In RMB Amount cause by Procedure for Enterprise Nature Amount charge-off Causes of charge-off related transactions charge-off or not (Y/N) Total -- 0.00 -- -- -- Other Explanation on account receivable charge-off Nil 5) Top 5 other account receivable collected by arrears party at ending balance In RMB Proportion in total Balance at other account Ending balance of Enterprise Nature Account age period-end receivables at bad debt provision period-end 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 Payment for Instrument 11,400.00 2-3 years 2.98% 34.20 equipment Technology Co., Ltd Shenzhen Color Life Property Management Deposit and margin 300.00 2-3 years 0.08% 0.90 Co., Ltd. Lianxin Garden Branch Total -- 381,872.00 -- 99.94% 1,145.61 6) Account receivable with government grants involved 152 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 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 Impairment Impairment Book balance Book value Book balance Book value provision provision 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 Changes in the period (+,-) Balance at Balance at Ending balance The invested Accrual of period-begin(B Additional Capital period-end(Boo of impairment entity impairment Other ook value) investment reduction k value) provision provision Shenzhen Emmelle 10,379.73 10,379.73 1,389,620.27 Industrial Co., Ltd. Total 10,379.73 0.00 0.00 0.00 0.00 10,379.73 1,389,620.27 (2) Investment for associates and joint venture In RMB Balance Changes in the period (+,-) Balance Ending Funded at at balance enterprise Additiona Capital Investme Other Other Cash Accrual Other period-be period-en of 153 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 gin(Book l reduction nt gains comprehe equity dividend of d(Book impairme value) investmen recognize nsive change or profit impairme value) nt t d under income announce nt provision equity adjustmen d to 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. Associated 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 21,426,406.12 20,428,856.90 20,600,065.94 18,788,402.55 Other business 3,977,972.72 3,241,165.72 3,423,452.74 2,057,815.53 Total 25,404,378.84 23,670,022.62 24,023,518.68 20,846,218.08 Whether implemented the new revenue standards □Yes √No Other explanation: Nil 5. Investment income In RMB Item Current Period Last Period 6. Other Nil 154 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 XVIII. Supplementary Information 1. Current non-recurring gains/losses √Applicable □Not applicable In RMB Item Amount Note Other non-operating income and expenditure 148,577.00 except for the aforementioned items Less: Impact on income tax 37,144.25 Impact on minority shareholders’ equity -11.25 Total 111,444.00 -- 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. ROE and EPS 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 -5.74% -0.0014 -0.0014 stockholders of the Company Net profits belong to common stock stockholders of the Company after -6.55% -0.0017 -0.0017 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 155 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 (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 156 深圳中华自行车(集团)股份有限公司 2019 年半年度报告全文 Section XI. Documents available for reference 1. Accounting statement carrying the signatures and seals of the legal representative, person in charge of accounting and person in charge of accounting organ. 2. Originals documents of the Company and manuscripts of public notices that disclosed in the newspaper designated by CSRC in the report period. 3. English version of the Semi-Annual Report 2019 157