Shenzhen Textile (Holdings) Co., Ltd.
The Semi-Annual Financial Report 2018
August 29, 2018
Shenzhen Textile(Holdings) Co., Ltd. The Semi-Annual Financial Report 2018
1. Audit report
Has this semi-annual report been audited?
□ Yes √ No
The semi-annual financial report has not been audited.
II. Financial Statements
Statement in Financial Notes are carried in RMB/CNY
1. Consolidated balance sheet
Prepared by: Shenzhen Textile (Holdings) Co., Ltd.
June 30,2018
In RMB
Items Year-end balance Year-beginning balance
Current asset：
Monetary fund 1,018,543,763.36 1,165,048,108.83
Settlement provision
Outgoing call loan
Financial assets measured at fair
value with variations accounted into
current income account
Derivative financial assets
Note receivable 1,668,992.95 44,207,119.00
Account receivable 224,607,517.07 192,503,077.70
Prepayments 195,851,353.47 13,755,152.05
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts
receivable
Interest receivable 18,833,479.86 15,728,872.62
Dividend receivable
Other account receivable 12,418,279.70 12,925,984.45
Repurchasing of financial assets
Inventories 329,292,048.68 275,615,176.16
Assets held for sales
Non-current asset due in 1 year
Other current asset 1,120,702,098.15 1,148,689,874.10
Total of current assets 2,921,917,533.24 2,868,473,364.91
Non-current assets：
Loans and payment on other’s behalf
disbursed
Disposable financial asset 65,355,577.27 66,035,733.04
Expired investment in possess
Long-term receivable
Long term share equity investment 20,519,573.38 20,380,734.56
Property investment 171,714,892.81 173,105,806.27
Fixed assets 1,021,301,163.50 656,133,200.19
Construction in progress 14,702,778.22 322,570,173.73
Engineering material
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 38,222,487.94 38,870,673.40
R & D petrol
Goodwill
Long-germ expenses to be amortized 1,182,723.32 1,035,290.08
Deferred income tax asset 2,625,253.73 1,974,536.90
Other non-current asset 42,346,134.84 47,166,994.48
Total of non-current assets 1,377,970,585.01 1,327,273,142.65
Total of assets 4,299,888,118.25 4,195,746,507.56
Current liabilities
Short-term loans 197,389,295.07 88,638,181.45
Loan from Central Bank
Deposit received and hold for others
Call loan received
Financial liabilities measured at fair
value with variations accounted into
current income account
Derivative financial liabilities
Note payable 19,500,000.00
Account payable 62,207,789.24 97,104,697.18
Advance payment 38,236,394.76 34,952,567.83
Selling of repurchased financial assets
Fees and commissions receivable
Employees’ wage payable 18,341,973.20 29,503,260.65
Tax payable 8,671,873.10 6,935,262.57
Interest payable 47,090,395.53 45,799,544.04
Dividend payable
Other account payable 202,634,969.35 155,026,799.54
Reinsurance fee payable
Insurance contract provision
Entrusted trading of securities
Entrusted selling of securities
Liabilities held for sales
Non-current liability due in 1 year 40,000,000.00
Other current liability
Total of current liability 594,072,690.25 497,960,313.26
Non-current liabilities：
Long-term loan 40,000,000.00 40,000,000.00
Bond payable
Including：preferred stock
Sustainable debt
Long-term payable
Long-term payable employees’s
remuneration
Special payable
Expected liabilities
Deferred income 134,350,896.96 134,767,064.72
Deferred income tax liability
Other non-current liabilities
Total non-current liabilities 174,350,896.96 174,767,064.72
Total of liability 768,423,587.21 672,727,377.98
Owners’ equity
Share capital 511,274,149.00 511,274,149.00
Other equity instruments
Including：preferred stock
Sustainable debt
Capital reserves 1,869,452,669.17 1,866,001,475.17
Less：Shares in stock 27,230,679.00 27,230,679.00
Other comprehensive income 1,828,936.20 2,218,703.87
Special reserves
Surplus reserves 77,477,042.19 77,477,042.19
Common risk provision
Undistributed profit -22,619,111.29 -32,266,087.44
Total of owner’s equity belong to the
2,410,183,006.27 2,397,474,603.79
parent company
Minority shareholders’ equity 1,121,281,524.77 1,125,544,525.79
Total of owners’ equity 3,531,464,531.04 3,523,019,129.58
Total of liabilities and owners’ equity 4,299,888,118.25 4,195,746,507.56
Legal Representative: Zhu Jun
Person-in-charge of the accounting work：Zhu Meizhu
Person-in -charge of the accounting organ：Mu Linying
2. Balance sheet of Parent Company
In RMB
Items Year-end balance Year-beginning balance
Current asset：
Monetary fund 383,109,930.25 413,700,327.95
Financial assets measured at fair value
with variations accounted into current
income account
Derivative financial assets
Note receivable
Account receivable 546,368.83 449,536.21
Prepayments 38,820.00 10,000.00
Interest receivable 18,735,478.37 13,660,866.80
Dividend receivable
Other account receivable 12,636,498.23 5,782,620.63
Inventories
Assets held for sales
Non-current asset due in 1 year
Other current asset 160,000,000.00 120,000,000.00
Total of current assets 575,067,095.68 553,603,351.59
Non-current assets：
Disposable financial asset 35,355,577.27 36,035,733.04
Expired investment in possess
Long-term receivable
Long term share equity investment 1,987,829,417.05 1,984,849,008.23
Property investment 164,478,188.20 165,607,900.07
Fixed assets 27,351,496.92 28,119,990.58
Construction in progress
Engineering material
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 1,212,840.21 1,413,305.67
R & D petrol
Goodwill
Long-germ expenses to be amortized
Differed income tax asset 2,252,235.59 1,526,871.33
Other non-current asset 493,620.44
Total of non-current assets 2,218,479,755.24 2,218,046,429.36
Total of assets 2,793,546,850.92 2,771,649,780.95
Current liabilities
Short-term loans
Financial liabilities measured at fair
value with variations accounted into
current income account
Derivative financial liabilities
Note payable
Account payable 411,743.57 411,743.57
Advance payment 639,024.58 639,024.58
Employees’ wage payable 6,298,397.27 8,495,538.21
Tax payable 4,961,074.06 3,247,028.64
Interest payable
Dividend payable
Other account payable 137,467,469.73 134,018,771.57
Liabilities held for sales
Non-current liability due in 1 year
Other current liability
Total of current liability 149,777,709.21 146,812,106.57
Non-current liabilities：
Long-term loan
Bond payable
Including：preferred stock
Sustainable debt
Long-term payable
Employees’ wage payable
Special payable
Expected liabilities
Differed income 750,000.00 800,000.00
Deferred income tax liability
Other non-current liabilities
Total of Non-current liabilities 750,000.00 800,000.00
Total of liability 150,527,709.21 147,612,106.57
Owners’ equity
Share capital 511,274,149.00 511,274,149.00
Other equity instrument
Including：preferred stock
Sustainable debt
Capital reserves 1,603,658,924.96 1,599,381,854.96
Less：Shares in stock 27,230,679.00 27,230,679.00
Other comprehensive income 1,828,936.20 2,218,703.87
Special reserves
Surplus reserves 77,477,042.19 77,477,042.19
Undistributed profit 476,010,768.36 460,916,603.36
Total of owners’ equity 2,643,019,141.71 2,624,037,674.38
Total of liabilities and owners’ equity 2,793,546,850.92 2,771,649,780.95
3.Consolidated Income statement
In RMB
Items Report period Same period of the previous year
I. Income from the key business 538,288,050.61 739,337,756.87
Incl：Business income 538,288,050.61 739,337,756.87
Interest income
Insurance fee earned
Fee and commission received
II. Total business cost 562,709,531.95 747,682,301.68
Incl：Business cost 479,118,600.37 677,617,195.79
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
Insurance policy dividend paid
Insurance policy dividend paid
Reinsurance expenses
Business tax and surcharge 3,840,556.12 6,589,017.85
Sales expense 3,780,411.53 4,007,043.14
Administrative expense 62,428,219.55 40,846,568.49
Financial expenses -3,852,587.66 -12,037,356.58
Asset impairment loss 17,394,332.04 30,659,832.99
Add：Gains from change of fir value
（“-”for loss）
Investment gain（“-”for loss） 28,552,710.15 22,955,035.39
Incl: investment gains from affiliates 616,945.67 220,115.63
Gains from currency exchange
Assets dispose loss
Other income 5,812,167.76 5,143,961.90
III. Operational profit（ “-” for loss） 9,943,396.57 19,754,452.48
Add ：Non-operational income 89,905.17 528,419.77
Less：Non-business expenses 153,338.08 3,478.36
IV.Total profit (“-” for loss) 9,879,963.66 20,279,393.89
Less：Income tax expenses 5,321,864.53 7,742,958.27
V. Net profit 4,558,099.13 12,536,435.62
1.Net continuing operating profit 4,558,099.13 12,536,435.62
2.Termination of operating net profit
Net profit attributable to the owners of
9,646,976.15 14,457,841.63
parent company
Minority shareholders’ equity -5,088,877.02 -1,921,406.01
VI.Net of profit of other comprehensive i
-389,767.67 -74,028.91
ncome
Net of profit of other comprehensive inco
me attributable to owners of the parent co -389,767.67 -74,028.91
mpany.
（I）Other comprehensive income items
that will not be reclassified into
gains/losses in the subsequent accounting
period
1.Re-measurement of defined benefit pla
ns of changes in net debt or net assets
2.Other comprehensive income under the
equity method investee can not be reclass
ified into profit or loss.
（II）
-389,767.67 -74,028.91
Other comprehensive income that will be
reclassified into profit or loss.
1.Other comprehensive income under the
equity method investee can be reclassifie
d into profit or loss.
2.Gains and losses from changes in fair v
-510,116.82 325,291.89
alue available for sale financial assets
3.Held-to-maturity investments reclassifi
ed to gains and losses of available for sal
e financial assets
4.The effective portion of cash flow hedg
es and losses
5.Translation differences in currency fina
120,349.15 -399,320.80
ncial statements
6.Other
Net of profit of other comprehensive inco
me attributable to Minority shareholders’
equity
VII. Total comprehensive income 4,168,331.46 12,462,406.71
Total comprehensive income
attributable to the owner of the parent 9,257,208.48 14,383,812.72
company
Total comprehensive income
-5,088,877.02 -1,921,406.01
attributable minority shareholders
VIII. Earnings per share
（I）Basic earnings per share 0.02 0.03
(II)Diluted earnings per share 0.02 0.03
The current business combination under common control, the net profits of the combined party befo
re achieved net profit of RMB 0.00, last period the combined party realized RMB0.00.
Legal Representative: Zhu Jun
Person-in-charge of the accounting work：Zhu Meizhu
Person-in -charge of the accounting organ：Mu Linying
4. Income statement of the Parent Company
In RMB
Items Report period Same period of the previous year
I. Income from the key business 33,343,899.42 31,849,598.03
Incl：Business cost 6,934,259.58 6,083,265.84
Business tax and surcharge 1,458,413.46 1,364,623.95
Sales expense
Administrative expense 14,436,569.89 10,388,438.80
Financial expenses -7,833,271.26 -6,361,722.17
Asset impairment loss 365,826.86 -3,652,130.67
Add：Gains from change of fir value
（“-”for loss）
Investment gain（“-”for loss） 1,191,719.82 2,146,702.07
Incl: investment gains from affiliates 616,945.67 220,115.63
Assets disposal income
Other income 50,000.00
II. Operational profit（ “-” for loss） 19,223,820.71 26,173,824.35
Add ：Non-operational income 79,604.02 1,510.00
Less：Non-business expenses 1,582.15
III.Total profit (“-” for loss) 19,303,424.73 26,173,752.20
Less：Income tax expenses 4,209,259.73 6,378,081.15
IV. Net profit（ “-” for net loss） 15,094,165.00 19,795,671.05
1.Net continuing operating profit 15,094,165.00 19,795,671.05
2.Termination of operating net profit
V.Net of profit of other comprehensive i
-389,767.67 -74,028.91
ncome
（I）Other comprehensive income
items that will not be reclassified into
gains/losses in the subsequent
accounting period
1.Re-measurement of defined benefit pl
ans of changes in net debt or net assets
2.Other comprehensive income under th
e equity method investee can not be recl
assified into profit or loss.
（ II ）
Other comprehensive income that will b -389,767.67 -74,028.91
e reclassified into profit or loss.
1.Other comprehensive income under th
e equity method investee can be reclassi
fied into profit or loss.
2.Gains and losses from changes in fair
-510,116.82 325,291.89
value available for sale financial assets
3.Held-to-maturity investments reclassif
ied to gains and losses of available for s
ale financial assets
4.The effective portion of cash flow hed
ges and losses
5.Translation differences in currency fin
120,349.15 -399,320.80
ancial statements
6.Other
VI. Total comprehensive income 14,704,397.33 19,721,642.14
VII. Earnings per share：
（I）Basic earnings per share
(II)Diluted earnings per share
5. Consolidated Cash flow statement
In RMB
Items Report period Same period of the previous year
I.Cash flows from operating activities
Cash received from sales of goods or
510,486,141.19 795,578,837.63
rending of services
Net increase of customer deposits
and capital kept for brother company
Net increase of loans from central bank
Net increase of inter-bank loans from
other financial bodies
Cash received against original insurance
contract
Net cash received from reinsurance
business
Net increase of client deposit and
investment
Net increase of trade financial asset
disposal
Cash received as interest, processing fee
and commission
Net increase of inter-bank fund received
Net increase of repurchasing business
Tax returned 24,120,883.81 23,710,137.30
Other cash received from business
26,160,799.70 35,648,684.61
operation
Sub-total of cash inflow 560,767,824.70 854,937,659.54
Cash paid for purchasing of
560,096,998.00 737,896,239.33
merchandise and services
Net increase of client trade and advance
Net increase of savings n central bank
and brother company
Cash paid for original contract claim
Cash paid for interest, processing fee
and commission
Cash paid for policy dividend
Cash paid to staffs or paid for staffs 76,371,093.88 69,775,248.99
Taxes paid 27,570,325.99 53,257,411.02
Other cash paid for business activities 25,580,296.27 92,185,161.14
Sub-total of cash outflow from business
689,618,714.14 953,114,060.48
activities
Cash flow generated by business
-128,850,889.44 -98,176,400.94
operation, net
II.Cash flow generated by investing
Cash received from investment
retrieving
Cash received as investment gains 1,673,214.15 3,781,185.22
Net cash retrieved from disposal of
fixed assets, intangible assets, and other 26,597.81 1,740.00
long-term assets
Net cash received from disposal of
subsidiaries or other operational units
Other investment-related cash received 1,903,828,974.66 2,205,083,032.64
Sub-total of cash inflow due to
1,905,528,786.62 2,208,865,957.86
investment activities
Cash paid for construction of
fixed assets, intangible assets 156,659,802.66 131,421,510.57
and other long-term assets
Cash paid as investment
Net increase of loan against pledge
Net cash received from subsidiaries and
other operational units
Other cash paid for investment
1,830,500,000.00 1,883,000,000.00
activities
Sub-total of cash outflow due to
1,987,159,802.66 2,014,421,510.57
investment activities
Net cash flow generated by investment -81,631,016.04 194,444,447.29
III.Cash flow generated by financing
Cash received as investment
Incl: Cash received as investment from
minor shareholders
Cash received as loans 275,474,786.49 51,181,623.57
Cash received from bond placing
Other financing –related ash received 6,809,000.00
Sub-total of cash inflow from financing
275,474,786.49 57,990,623.57
activities
Cash to repay debts 209,562,972.59 66,068,073.78
Cash paid as dividend, profit, or
1,439,654.15
interests
Incl: Dividend and profit paid by
subsidiaries to minor shareholders
Other cash paid for financing activities
Sub-total of cash outflow due to
211,002,626.74 66,068,073.78
financing activities
Net cash flow generated by financing 64,472,159.75 -8,077,450.21
IV. Influence of exchange rate
-494,599.74 -668,409.25
alternation on cash and cash equivalents
V.Net increase of cash and cash
-146,504,345.47 87,522,186.89
equivalents
Add: balance of cash and cash
1,161,240,139.33 930,114,436.57
equivalents at the beginning of term
VI ..Balance of cash and cash
1,014,735,793.86 1,017,636,623.46
equivalents at the end of term
6. Cash Flow Statement of the Parent Company
In RMB
Items Amount in this period Amount in last period
I.Cash flows from operating activities
Cash received from sales of goods or
34,341,479.70 32,697,766.87
rending of services
Tax returned
Other cash received from business
6,186,752.60 12,894,925.40
operation
Sub-total of cash inflow 40,528,232.30 45,592,692.27
Cash paid for purchasing of
2,734,504.18 1,748,604.45
merchandise and services
Cash paid to staffs or paid for staffs 10,002,845.66 8,290,247.88
Taxes paid 7,067,139.21 8,145,004.75
Other cash paid for business activities 12,230,536.71 8,891,199.29
Sub-total of cash outflow from business
32,035,025.76 27,075,056.37
activities
Cash flow generated by business
8,493,206.54 18,517,635.90
operation, net
II.Cash flow generated by investing
Cash received from investment
retrieving
Cash received as investment gains 1,673,214.15 3,781,185.22
Net cash retrieved from disposal of
fixed assets, intangible assets, and other 24,597.81 1,510.00
long-term assets
Net cash received from disposal of
subsidiaries or other operational units
Other investment-related cash received 763,589.50 80,000,000.00
Sub-total of cash inflow due to
2,461,401.46 83,782,695.22
investment activities
Cash paid for construction of
fixed assets, intangible assets 1,545,005.70 1,371,469.00
and other long-term assets
Cash paid as investment
Net cash received from subsidiaries and
other operational units
Other cash paid for investment
40,000,000.00 160,000,000.00
activities
Sub-total of cash outflow due to
41,545,005.70 161,371,469.00
investment activities
Net cash flow generated by investment -39,083,604.24 -77,588,773.78
III.Cash flow generated by financing
Cash received as investment
Cash received as loans
Cash received from bond placing
Other financing –related ash received
Sub-total of cash inflow from
financing activities
Cash to repay debts
Cash paid as dividend, profit, or
interests
Other cash paid for financing activities
Sub-total of cash outflow due to
financing activities
Net cash flow generated by financing
IV. Influence of exchange rate
alternation on cash and cash equivalents
V.Net increase of cash and cash
-30,590,397.70 -59,071,137.88
equivalents
Add: balance of cash and cash
413,700,327.95 440,685,610.11
equivalents at the beginning of term
VI ..Balance of cash and cash
383,109,930.25 381,614,472.23
equivalents at the end of term
7. Consolidated Statement on Change in Owners’ Equity
Amount in this period
In RMB
Amount in this period
Owner’s equity Attributable to the Parent Company
Other Equity
Minor
instrument Total of
Items Other Commo Undist
Share Less: Speciali shareho
Capital Compre Surplus n risk ribute owners’
Capita prefer Shares zed lders’
Sustai reserves hensive reserves provisio d equity
l red Other in stock reserve equity
nable Income n profit
stock
debt
511,2 1,866, 27,230 77,477 -32,26 1,125, 3,523,
I.Balance at the 2,218,
74,14 001,47 ,679.0 ,042.1 6,087. 544,52 019,12
end of last year 703.87
9.00 5.17 0 9 44 5.79 9.58
Add: Change of
accounting
policy
Correcting of
previous errors
Merger of entities
under common
control
Other
II.Balance at the 511,2 1,866, 27,230 77,477 -32,26 1,125, 3,523,
2,218,
beginning of 74,14 001,47 ,679.0 ,042.1 6,087. 544,52 019,12
703.87
current year 9.00 5.17 0 9 44 5.79 9.58
-4,263
III.Changed in the 3,451, -389,7 9,646, 8,445,
,001.0
current year 194.00 67.67 976.15 401.46
2
（1）Total -4,263
-389,7 9,646, 4,994,
comprehensive ,001.0
67.67 976.15 207.46
income 2
（II）Investment
3,451, 3,451,
or decreasing of
194.00 194.00
capital by owners
1．Ordinary Share
s invested by share
holders
2 ． Holders of oth
er equity instrume
nts invested capital
3．Amount of
shares paid and 3,451, 3,451,
accounted as 194.00 194.00
owners’ equity
4．Other
（III）Profit
allotment
1.Providing of
surplus reserves
2.Providing of
common risk
provisions
3．Allotment to the
owners (or
shareholders)
4．Other
(IV) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3．Making up
losses by surplus
reserves.
4. Other
(V). Special
reserves
1. Provided this
year
2．Used this term
（VI）Other
511,2 1,869, 27,230 77,477 -22,61 1,121, 3,531,
IV. Balance at the 1,828,
74,14 452,66 ,679.0 ,042.1 9,111. 281,52 464,53
end of this term 936.20
9.00 9.17 0 9 29 4.77 1.04
Amount in last year
In RMB
Amount in last year
Owner’s equity Attributable to the Parent Company
Other Equity
Minor
instrument Other Commo Undist Total of
Items Share Less: Speciali shareho
Capital Compre Surplus n risk ribute owners’
Capita prefer Shares zed lders’
Sustai reserves hensive reserves provisio d equity
l red in stock reserve equity
Other
nable Income n profit
stock
debt
506,5 1,837, 73,710 -81,27 1,100, 3,440,
I.Balance at the 3,392,
21,84 205,25 ,682.0 5,828. 564,80 118,98
end of last year 222.07
9.00 1.95 5 76 5.80 2.11
Add: Change of
accounting
policy
Correcting of
previous errors
Merger of entities
under common
control
Other
II.Balance at the 506,5 1,837, 73,710 -81,27 1,100, 3,440,
3,392,
beginning of 21,84 205,25 ,682.0 5,828. 564,80 118,98
222.07
current year 9.00 1.95 5 76 5.80 2.11
4,752 28,796 27,230 -1,173 49,009 24,979 82,900
III.Changed in the 3,766,
,300. ,223.2 ,679.0 ,518.2 ,741.3 ,719.9 ,147.4
current year 360.14
00 2 0 0 2 9 7
（1）Total -1,173 52,776 20,885 72,488
comprehensive ,518.2 ,101.4 ,576.4 ,159.6
income 0 6 1 7
（II）Investment 4,752 22,762 27,230 284,49
or decreasing of ,300. ,870.5 ,679.0 1.54
capital by owners 00 4 0
1．Ordinary Share 4,752 22,478 27,230
s invested by share ,300. ,379.0 ,679.0
holders 00 0 0
2 ． Holders of oth
er equity instrume
nts invested capital
3．Allotment to the
284,49 284,49
owners (or 1.54 1.54
shareholders)
4．Other
-3,766
（III）Profit 3,766,
,360.1
allotment 360.14
4
-3,766
1.Providing of 3,766,
,360.1
surplus reserves 360.14
4
2.Providing of
common risk
provisions
3．Allotment to the
owners (or
shareholders)
4．Other
(IV) Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3．Making up
losses by surplus
reserves.
4. Other
(V) Special
reserves
1. Provided this
year
2．Used this term
10,127
6,033, 4,094,
（VI）Other ,496.2
352.68 143.58
6
511,2 1,866, 27,230 77,477 -32,26 1,125, 3,523,
IV. Balance at the 2,218,
74,14 001,47 ,679.0 ,042.1 6,087. 544,52 019,12
end of this term 703.87
9.00 5.17 0 9 44 5.79 9.58
8.Statement of change in owner’s Equity of the Parent Company
Amount in this period
In RMB
Amount in this period
Other Equity instrument
Other Undist
Less: Total of
Items Share Capital Compreh Specialize Surplus ribute
preferre Sustain Shares in owners’
Capital Other reserves ensive d reserve reserves d
d stock able stock equity
Income profit
debt
460,91
I.Balance at the 511,274 1,599,38 27,230,6 2,218,70 77,477,0 2,624,03
6,603.
end of last year ,149.00 1,854.96 79.00 3.87 42.19 7,674.38
36
Add: Change of
accounting
policy
Correcting of
previous errors
Other
II.Balance at the 460,91
511,274 1,599,38 27,230,6 2,218,70 77,477,0 2,624,03
beginning of 6,603.
,149.00 1,854.96 79.00 3.87 42.19 7,674.38
current year 36
15,094
III.Changed in the 4,277,07 -389,767 18,981,4
,165.0
current year 0.00 .67 67.33
0
（I）Total 15,094
-389,767 14,704,3
comprehensive ,165.0
.67 97.33
income 0
(II) Investment or
4,277,07 4,277,07
decreasing of
0.00 0.00
capital by owners
1．Ordinary Share
s invested by share
holders
2 ． Holders of oth
er equity instrume
nts invested capital
3.Amount of
shares paid and 4,277,07 4,277,07
accounted as 0.00 0.00
owners’ equity
4．Other
（III）Profit
allotment
1.Providing of
surplus reserves
2．Allotment to the
owners (or
shareholders)
3．Other
(IV)Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3．Making up
losses by surplus
reserves.
4. Other
(V) Special
reserves
1. Provided this
year
2．Used this term
（VI）Other
476,01
IV. Balance at the 511,274 1,603,65 27,230,6 1,828,93 77,477,0 2,643,01
0,768.
end of this term ,149.00 8,924.96 79.00 6.20 42.19 9,141.71
36
Amount in last year
In RMB
Amount in last year
Other Equity instrument
Other Undist
Less: Total of
Items Share Capital Compreh Specialize Surplus ribute
preferre Sustain Shares in owners’
Capital Other reserves ensive d reserve reserves d
d stock able stock equity
Income profit
debt
427,01
I.Balance at the 506,521 1,576,54 3,392,22 73,710,6 2,587,19
9,362.
end of last year ,849.00 7,075.96 2.07 82.05 1,191.19
11
Add: Change of
accounting
policy
Correcting of
previous errors
Other
II.Balance at the 427,01
506,521 1,576,54 3,392,22 73,710,6 2,587,19
beginning of 9,362.
,849.00 7,075.96 2.07 82.05 1,191.19
current year 11
33,897
III.Changed in the 4,752,3 22,834,7 27,230,6 -1,173,5 3,766,36 36,846,4
,241.2
current year 00.00 79.00 79.00 18.20 0.14 83.19
5
（I）Total 37,663
-1,173,5 36,490,0
comprehensive ,601.3
18.20 83.19
income 9
(II) Investment or
4,752,3 22,834,7 27,230,6 356,400.
decreasing of
00.00 79.00 79.00 00
capital by owners
1．Ordinary Share 4,752,3 22,478,3 27,230,6
s invested by share 00.00 79.00 79.00
holders
2 ． Holders of oth
er equity instrume
nts invested capital
3.Amount of
shares paid and 356,400. 356,400.
accounted as 00 00
owners’ equity
4．Other
-3,766
（III）Profit 3,766,36
,360.1
0.14
allotment 4
-3,766
1.Providing of 3,766,36
,360.1
surplus reserves 0.14
4
2．Allotment to the
owners (or
shareholders)
3．Other
(IV)Internal
transferring of
owners’ equity
1. Capitalizing of
capital reserves (or
to capital shares)
2. Capitalizing of
surplus reserves
(or to capital
shares)
3．Making up
losses by surplus
reserves.
4. Other
(V) Special
reserves
1. Provided this
year
2．Used this term
（VI）Other
460,91
IV. Balance at the 511,274 1,599,38 27,230,6 2,218,70 77,477,0 2,624,03
6,603.
end of this term ,149.00 1,854.96 79.00 3.87 42.19 7,674.38
36
III. Basic Information of the Company
1. Enterprise registration address, organization mode and headquarter address.
The company was previously the Shenzhen Textile Industry Company, on April 13, 1994,
approved by the Letter(1994)No.15 issued by Shenzhen Municipal People's Government, the
Company was restructured and named as Shenzhen Textile (Holdings) Co., Ltd. In the same year,
approved by the (1994) No.19 file of Shenzhenshi, the shares of the company were listed in
Shenzhen Stock Exchange. The company now holds a unified social credit code for the
91440300192173749Y business license,Registration address and headquarter address are
6/F,Shenfang Building, No.3 Huaqiang Road. North, Futian District, Shenzhen.
2.Enterprise’s business nature and major business operation.
At present, the Company is mainly engaged in high-tech industry focusing on R&D, production and
marketing of polarizers for liquid crystal display, management of properties in bustling business
districts of Shenzhen and reserved high-class textile and garment business.
3. Approval of the financial statements reported
The financial statements have been authorized for issuance by the Board of Directors of the Group on
August 27,2018.
As of the end of the reporting period, there are 7 subsidiaries companies included in the consolidate
d financial statements:Shenzhen Shengbo Optoelectronic Technology Co., Ltd., Shenzhen Lisi
Industrial Development Co., Ltd.,Shenzhen Huaqiang Hotel, Shenzhen Shenfang Property
Management Co., Ltd. Shenzhen Beaufity Garments Co., Ltd. ,Shzhen Shenfang Import & Export
Co., Ltd., and Shengtou (Hongkong) Co., Ltd.
The scope of consolidated financial statements this period did not change.
IV.Basis for the preparation of financial statements
（1）Basis for the preparation
This company’s financial statements is based on going-concern assumption and worked out
according to actual transactions and matters, Accounting Standard for Business Enterprises--Basic
Standard(issued by No.33 Decree of the Ministry of Finance and revised by No.76 Decree of the
Ministry of Finance) issued by the Ministry of Finance, 42 special accounting standards enacted and
revised on and after Feb 15, 2006, guideline for application of accounting standard for business
enterprises, ASBE interpretations and other relevant regulations(hereinafter collectively referred to as
“Accounting Standard for Business Enterprises”) and No.15 of Compilation Rules for Information
Disclosure by Companies Offering Securities to the Public-- General Provisions of Financial Reports
(revised in 2014) issued by China Securities Regulatory Commission.
(2)Continuation
There will be no such events or situations in the 12 months from the end of the reporting period that
will cause material doubts as to the continuation capability of the Company.
V. Important accounting policies and estimations
Specific accounting policies and accounting estimates tips:
The following important accounting policies and accounting estimates of the Company are
formulated in accordance with the Accounting Standards for Business Enterprises. Businesses not
mentioned are implemented in accordance with the relevant accounting policies in the Accounting
Standards for Business Enterprises.
1. Statement on complying with corporate accounting standards
The financial statements prepared by the Company comply with the requirements of corporate
accounting standards. They truly and completely reflect the financial situations, operating results,
equity changes and cash flow, and other relevant information of the company.
2.Fiscal Year
The Company adopts the Gregorian calendar year commencing on January 1 and ending on
December 31 as the fiscal year.
3. Operating cycle
Normalbusiness cycle is realized by the Companyin cash or cash
equivalentsfromthepurchaseofassetsfor mpocessing until. Less than 1 year is for the normal
operating cycle in the company.
With regard to less than 1 year for the normal operating cycle, the assets realized or the liabilities
repaid at maturity within one year as of the balance sheet date shall be classified into the current
assets or the current liabilities.
4. Accounting standard money
The Company takes RMB as the standard currency for bookkeeping.
5. Accounting process method of enterprise consolidation under same and different controlling.
（1）Enterprise merger under same control：
For a business combination involving enterprises under common control, the party that, on the
combination date, obtains control of another enterprise participating in the combination is the
absorbing party, while that other enterprise participating in the combination is a party being absorbed.
Combination date is the date on which the absorbing party effectively obtains control of the party
being absorbed.
The assets and liabilities obtained are measured at the carrying amounts as recorded by the
enterprise being combined at the combination date. The difference between the carrying amount of
the net assets obtained and the carrying amount of consideration paid for the combination (or the total
face value of shares issued) is adjusted to the capital premium in the capital reserve. If the balance of
the capital premium is insufficient, any excess is adjusted to retained earnings.
The cost of a combination incurred by the absorbing party includes any costs directly attributable to
the combination shall be recognized as an expense through profit or loss for the current period when
incurred.
Accounting Treatment of the Consolidated Financial Statements:
The long-term equity investment held by the combining party before the combination will change if
the relevant profit and loss, other comprehensive income and other owner equity are confirmed
between the ultimate control date and the combining date for the combining party and the combined
party on the acquirement date, and shall respectively offset the initial retained incomes or the profits
and losses of the current period during the comparative statement.
(2) Business combination involving entities not under common control
A business combination involving enterprises not under common control is a business combination in
which all of the combining enterprises are not ultimately controlled by the same party or parties both
before and after the business combination.For a business combination not involving enterprises under
common control, the party that, on the acquisition date, obtains control of another enterprise
participating in the combination is the acquirer, while that other enterprise participating in the
combination is the acquiree. Acquisition date is the date on which the acquirer effectively obtains
control of the acquiree.
The difference of the merger cost minus the fair value shares of identifiable net assets obtained by the
acquiree during the merger on the acquisition date, is recognized as the business reputation. While the
merger cost is less than the fair value shares of identifiable net assets obtained by the acquiree during
the merger, all the measurement on the identifiable assets, the liabilities, the fair value of liabilities
and the merger cost obtained by the acquiree should firstly be rechecked, and the difference shall be
recorded into the current profits and costs if the merger cost is still less than the fair value shares of
identifiable net assets obtained by the acquiree during the merger after rechecking.
Where the temporary difference obtained by the acquirer was not recognized due to inconformity
with the conditions applied for recognition of deferred income tax, if, within the 12 months after
acquisition, additional information can prove the existence of related information at acquisition date
and the expected economic benefits on the acquisition date arose from deductible temporary
difference by the acquiree can be achieved, relevant income tax assets can be recognized, and
goodwill offset. If the goodwill is not sufficient, the difference shall be recognized as profit of the
current period.
For a business combination not involving enterprise under common control, which achieved in
stages that involves multiple exchange transactions, according to “The notice of the Ministry of
Finance on the issuance of Accounting Standards Interpretation No. 5” (CaiKuai [2012] No. 19) and
Article51 of “Accounting Standards for Business Enterprises No.33 - Consolidated Financial
Statements” on the “package deal” criterion, to judge the multiple exchange transations whether they
are the"package deal". If it belong to the “package deal” in reference to the preceding paragraphs of
this section and “long-term investment” accounting treatment, if it does not belong to the “package
deal” to distinguish the individual financial statements and the consolidated financial statements
related to the accounting treatment:
In the individual financial statements, the total value of the book valueoftheacquiree's equity
investment before the acquisition date and the cost of new investment at the acquisition date, as the
initial cost of the investment, the acquiree's equity investment before the acquisition date involved in
other comprehensive income, in the disposal of the investment will be in other comprehensive
income associated with the use of infrastructure and the acquiree directly related to the disposal of
assets or liabilities of the same accounting treatment (that is, except in accordance with the equity
method of accounting in the defined benefit plan acquiree is remeasured net changes in net assets or
liabilities other than in the corresponding share of the lead, and the rest into the current investment
income).
In the combination financial statements, the equity interest in the acquiree previously held before the
acquisition date re-assessed at the fair value at the acquisition date, with any difference between its
fair value and its carrying amount is recorded as investment income.The previously-held equity
interest in the acquiree involved in other comprehensive income and other comprehensive income
associated with the purchase of the foundation should be used party directly related to the disposal of
assets or liabilities of the same accounting treatment (that is, except in accordance with the equity
method of accounting in the acquiree is remeasured defined benefit plans other than changes in net
liabilities or net assets due to a corresponding share of the rest of the acquisition date into current
investment income).
6.Preparation of the consolidated financial statements
(1) The scope of consolidation
The scope of consolidation for the consolidated financial statements is determined on the basis of
control. Control is the power to govern the financial and operating policies of an enterprise so as to
obtain benefits from its operating activities. The relevant events refer to the activities that have
significant influence on the return to the invested party. In accordance with the specific conditions,
the relevant events of the invested party should conclude the sale and purchase of goods and services,
the management of the financial assets, the purchase and disposal of the assets, the research and
development activities, the financing activities and so on.
The scope of consolidation includes the Company and all of the subsidiaries. Subsidiary is an
enterprise or entity under the control of the Company.
Once the change in the relevant facts and circumstances leading to the definition of the relevant
elements involved in the control of the change, the company will be re-evaluated.
(2) Preparation of the consolidated financial statements.
The Company based on its own and its subsidiaries financial statements, in accordance with other
relevant information, to prepare the consolidated financial statements.
For a subsidiary acquired through a business combination not under common control, the operating
results and cash flows from the acquisition (the date when the control is obtained) are included in the
consolidated income statement and consolidated statement of cash flows, as appropriated; no
adjustment is made to the opening balance and comparative figures in the consolidated financial
statements. Where a subsidiary and a party being absorbed in a merger by absorption was acquired
during the reporting period, through a business combination involving enterprises under common
control, the financial statements of the subsidiary are included in the consolidated financial
statements. The results of operations and cash flow are included in the consolidated balance sheet and
the consolidated income statement, respectively, based on their carrying amounts, from the date that
common control was established, and the opening balances and the comparative figures of the
consolidated financial statements are restated.
When the accounting period or accounting policies of a subsidiary are different from those of the
Company, the Company makes necessary adjustments to the financial statements of the subsidiary
based on the Company’s own accounting period or accounting policies. Where a subsidiary was
acquired during the reporting period through a business combination not under common control, the
financial statements was reconciliated on the basis of the fair value of identifiable net assets at the
date of acquisition.
Intra-Group balances and transactions, and any unrealized profit or loss arising from intra-Group
transactions, are eliminated in preparing the consolidated financial statements.
Minority interest and the portion in the net profit or loss not attributable to the Company are
presented separately in the consolidated balance sheet within shareholders’/ owners’ equity and net
profit. Net profit or loss attributable to minority shareholders in the subsidiaries is presented
separately as minority interest in the consolidated income statement below the net profit line item.
When the amount of loss for the current period attributable to the minority shareholders of a
subsidiary exceeds the minority shareholders’ portion of the opening balance of shareholders’/equity
of the subsidiary, the excess is allocated against the minority interests.
When the Company loses control of a subsidiary due to the disposal of a portion of an equity
investment or other reasons, the remaining equity investment is re-measured at its fair value at the
date when control is lost. The difference between 1) 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 2) the carrying amounts of the interest in the former subsidiary’s net assets
immediately before the loss of the control is recognized as investment income for the current period
when control is lost. Other comprehensive income related to the former subsidiary's equity
investment, using the foundation and the acquiree directly related to the disposal of the same assets or
liabilities are accounted when the control is lost (ie, in addition to the former subsidiary is remeasured
at the net defined benefit plan or changes in net assets and liabilities resulting from, the rest are
transferred to the current investment income). The retained interest is subsequently measured
according to the rules stipulated in the - “Chinese Accounting Standards for Business Enterprises
No.2 - Long-term equity investment” or “Chinese Accounting Standards for Business Enterprises
No.22 - Determination and measurement of financial instruments”.
The company through multiple transactions step deal with disposal of the subsidiary's equity
investment until the loss of control, need to distinguish between equity until the disposal of a
subsidiary's loss of control over whether the transaction is package deal. Terms of the transaction
disposition of equity investment in a subsidiary, subject to the following conditions and the economic
impact of one or more of cases, usually indicates that several transactions should be accounted for as
a package deal:①these transactions are considered。simultaneously, or in the case of mutual influence
made, ②these transactions as a whole in order to achieve a complete business results; ③the
occurrence of a transaction depends on occurs at least one other transaction; ④a transaction look
alone is not economical, but when considered together with other transaction is economical.
If they does not belong to the package deal, each of them separately, as the case of a transaction in
accordance with “without losing control over the disposal of a subsidiary part of a long-term equity
investments“principles applicable accounting treatment. Until the disposal of the equity investment
loss of control of a subsidiary of the transactions belonging to the package deal, the transaction will
be used as a disposal of a subsidiary and the loss of control of the transaction. However, before losing
control of the price of each disposal entitled to share in the net assets of the subsidiary 's investment
corresponding to the difference between the disposal, recognized in the consolidated financial
statements as other comprehensive income, loss of control over the transferred together with the loss
of control or loss in the period.
7.Joint venture arrangements classification and Co-operation accounting treatment
(1) Joint arrangement
A joint arrangement is an arrangement of which two or more partieshave joint control，depending of
the rights and obligation of the Company in the joint arrangement. A joint operation is a joint
arrangement whereby the Company has rights to the assets, andobligations for the liabilities, relating
to the arrangement. A joint venture is a joint arrangement whereby the Company has rights to the net
assets of thearrangement.
(2)Co-operation accounting treatment
When the joint venture company for joint operations, confirm the following items and share commo
n business interests related to:
（1）Confirm individual assets and common assets held based on shareholdings;
（2）Confirm individual liabilities and shared liabilities held based on shareholdings;
（3）Confirm the income from the sales revenue of co-operate business output
（4）Confirm the income from the sales of the co-operate business output based on shareholdings;
（5）Confirm the individual expenditure and co-operate business cost based on shareholdings.
(3)When a company is a joint ventures, joint venture investment will be recognized as long-term equi
ty investments .
8.Recognition Standard of Cash & Cash Equivalents
Cash and cash equivalents of the Company include cash on hand, ready usable deposits and
investments having short holding term (normally will be due within three months from the day of
purchase), with strong liquidity and easy to be exchanged into certain amount of cash that can be
measured reliably and have low risks of change.
9.Foreign Currency Transaction
（1）Foreign Currency Transaction
The approximate shot exchange rate on the transaction date is adopted and translated as RMB
amount when the foreign currency transaction is initially recognized. On the balance sheet date, the
monetary items of foreign currency are translated as per the shot exchange rate on the balance sheet
date, the foreign exchange conversion gap due to the exchange rate, except for the balance of
exchange conversion arising from special foreign currency borrowings capitals and interests for the
purchase and construction of qualified capitalization assets, shall be recorded into the profits and
losses of the current period. The non-monetary items of foreign currency measured at the historical
cost shall still be translated at the spot exchange rate on the transaction date, of which the RMB
amount shall not be changed. The non-monetary items of foreign currency measured at the fair
value shall be translated at the spot exchange rate on the fair value recognized date, the gap shall be
recorded into the current profits and losses or other comprehensive incomes.
(2) Translation Method of Foreign Currency Financial Statement
For the assets and liabilities in the balance sheet, the shot exchange rate on the balance sheet date is
adopted as the translation exchange rate. For the owner’s equity, the shot exchange rate on the
transaction date is adopted as the translation exchange rate, with the exception of “undistributed
profits”. The incomes and expenses in the income statement shall be translated at the spot exchange
rate or the approximate exchange rate on the transaction date. The translation gap of financial
statement of foreign currency converted above shall be listed in other comprehensive incomes under
the owner’s equity in the consolidated balance sheet.
10.Financial tools
One financial asset or financial liability shall be recognized when the company becomes the party in
the financial instrument contract. The financial assets and the financial liabilities are measured at the
fair value in the initial recognition. For the financial assets and liabilities that measured at the fair
values and the variation included in the current profits and losses, the relative transaction expenses
shall be directly recorded into the profits and losses. For the financial assets and liabilities of other
categories, the expenses related to transactions are recognized as initial amount.
1 Determination of financial assets and liabilities’ fair value
Fair value is the amount for which an asset could be exchanged, or a liability settled, between
knowledgeable, willing parties in an arm’s length transaction. For a financial instrument which has an
active market, the Company uses quoted price in the active market to establish its fair value. The
quoted price in the active market refers to the price that can be regularly obtained from exchange
market, agencies, industry associations, pricing authorities; it represents the fair market trading price
in the actual transaction. For a financial instrument which does not have an active market, the
Company establishes fair value by using 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.
2. Classification, recognition and measurement of financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date
basis. On initial recognition, the Company’s financial assets are classified into including financial
assets at fair value though profit or loss, held-to maturity investments, loans and receivables and
available-for-trade assets.
（1） Financial assets at fair value through profit or loss:
Including financial assets held-for-trade and financial assets designated at fair value through profit or
loss.Financial asset held-for-trade is the financial asset that meets one of the following conditions:
A. the financial asset is acquired for the purpose of selling it in a short term;
B. the financial asset is a part of a portfolio of identifiable financial instruments that are collectively
managed, and there is objective evidence indicating that the enterprise recently manages this portfolio
for the purpose of short-term profits;
C. the financial asset is a derivative, except for a derivative that is designated and effective hedging
instrument, or a financial guarantee contract, or a derivative that is linked to and must be settled by
delivery of an unquoted equity instrument (without a quoted price from an active market) whose fair
value cannot be reliably measured. For such kind of financial assets, fair values are adopted for
subsequent measurement.
Financial asset is designated on initial recognition as at fair value through profit or loss only when it
meets one of the following conditions:
A. the designation eliminates or significantly reduces the inconsistency in the measurement or
recognition of relevant gains or losses that would otherwise arise from measuring the financial
instruments on different bases.
B. a Group of financial instruments is managed and its performance is evaluated on a fair value basis,
and is reported to the enterprise’s key management personnels. Formal documentation regarding risk
management or investment strategy has prepared。
Financial assets at fair value through profit or loss are subsequently measured at the fair value. Any
gains or losses arising from changes in the fair value and any dividends or interest income earned on
the financial assets are recognized in the profit or loss.
（2）Investment held-to maturity
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments
and fixed maturity that an entity has the positive intention and ability to hold to maturity. Such kind
of financial assets are subsequently measured at amortized cost using the effective interest method.
Gains or losses arising from derecognition, impairment or amortization are recognized in profit or
loss for the current period.
Effective interest rate is the rate that exactly discounted estimated future cash flows through the
expected life of the financial asset or financial liability or, where appropriate, a shorter period to the
net carrying amount of the financial asset or financial liability. When calculating the effective interest
rate, the Company shall estimate future cash flow considering all contractual terms of the financial
asset or financial liability without considering future credit losses, and also consider all fees paid or
received between the parties to the contract giving rise to the financial asset and financial liability that
are an integral part of the effective interest rate, transaction costs, and premiums or discounts, etc.
（3）Loans and receivables
Loans and receivables are non-derivative financial assets with fixed determinable payment that are
not quoted in an active market. Financial assets classified as loans and receivables by the Company
include note receivables, account receivables, interest receivable dividends receivable and other
receivables.
Loans and receivables are subsequently measured at amortized cost using the effective interest
method. Gain or loss arising from derecognition, impairment or amortization is recognized in profit
or loss.
（4）Financial assets available-for-trade
Financial assets available-for-trade include non-derivative financial assets that are designated on
initial recognition as available for trade, and financial assets that are not classified as financial assets
at fair value through profit or loss, loans and receivables or investment held-to-maturity.
Financial assets available-for-trade are subsequently measured at fair value, and gains or losses
arising from changes in the fair value are recognized as other comprehensive income and included in
the capital reserve, except that impairment losses and exchange differences related to amortized cost
of monetary financial assets denominated in foreign currencies are recognized in profit or loss, until
the financial assets are derecognized, at which time the gains or losses are released and recognized in
profit or loss. Interests obtained and dividends declared by the investee during the period in which the
financial assets available-for-trade are held, are recognized in investment gains.
3. Impairment of financial assets
The Group assesses at the balance sheet date the carrying amount of every financial asset except for
the financial assets that measured by the fair value. If there is objective evidence indicating a
financial asset may be impaired, a provision is provided for the impairment.
The company shall make an independent impairment test on the financial assets with significant
single amounts, and carry out an independent impairment test on the financial assets with
insignificant single amounts, or conduct an impairment-related test after they are included in a
combination of financial assets with similar credit risk features so as to carry out. Where, upon
independent test, the financial asset (including those financial assets with significant single amounts
and those with insignificant amounts) has not been impaired, it shall be included in a combination of
financial assets with similar risk features so as to conduct another impairment test. The financial
assets which have suffered from an impairment loss in any single amount shall not be included in any
combination of financial assets with similar risk features for any impairment test.
（1）Impairment on held-to maturity investment, loans and receivables
The financial assets measured by cost or amortized cost write down their carrying value by the
estimated present value of future cash flow. The difference is recorded as impairment loss. If there is
objective evidence to indicate the recovery of value of financial assets after impairment, and it is
related with subsequent event after recognition of loss, the impairment loss recorded originally can be
reversed. The carrying value of financial assets after impairment loss reversed shall not exceed the
amortized cost of the financial assets without provisions of impairment loss on the reserving date.
（2）Impairment loss on available-for-trade financial assets
Where the fair value of the equity instrument investment drops significantly or not contemporarily
according to the integrated relevant factors, an available-for-trade financial asset is impaired. The
"serious decline" refers to the cumulative fair value declines more than 30%; "non-temporary
decline" refers to the continuous decline in the fair value of time over 12 months.
When an available-for-trade financial asset is impaired, the cumulative loss arising from declining in
fair value thathad been recognized in capital reserve shall be removed and recognized in profit or loss.
The amount of the cumulative loss that is removed shall be difference between the acquisition cost
with deduction of recoverable amount less amortized cost, current fair value and any impairment loss
on that financial asset previously recognized in profit or loss.
If, after an impairment loss has been recognized, there is objective evidence that the value of the
financial asset is recovered, and it is objectively related to an event occurring after the impairment
loss was recognized, the initial impairment loss can be reversed and the reserved impairment loss on
available-for-trade equity instrument is recorded in the profit or loss, the reserved impairment loss on
available-for-trade debt instrument is recorded in the current profit or loss.
The equity instrument where there is no quoted price in an active market, and whose fair value cannot
be reliably measured, or impairment loss on a derivative asset that is linked to and must be settled by
delivery of such an unquoted equity instrument shall not be reversed.
4. Recognition and measurement of financial assets transfer
The Group derecognizes a financial asset when one of the following conditions is met:
1) the rights to receive cash flows from the asset have expired;
2) the enterprise has transferred its rights to receive cash flows from the asset to a third party under a
pass-through arrangement; or
3) the enterprise has transferred its rights to receive cash flows from the asset and either has
transferred substantially all the risks and rewards of the asset, or has neither transferred norretained
substantially all the risks and rewards of the asset, but has transferred control of the asset.
If the enterprise has neither retained all the risks and rewards from the financial asset nor control over
the asset, the asset is recognized according to the extent it exists as financial asset, and correspondent
liability is recognized. The extent of existence refers the level of risk by the financial asset changes
the enterprise is facing.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the carrying
amount of the financial asset transferred; and the sum of the consideration received from the transfer
and any cumulative gain or loss that had been recognized in other comprehensive income, is
recognized in profit or loss.
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 relative fair value of those parts. The difference between (a) the
carrying amount allocated to the part derecognized; and (b) the sum of the consideration received for
the part derecognized and any cumulative gain or loss allocated to the part derecognized which has
been previously recognized in other comprehensive income, is recognized in profit or loss.
The Company uses recourse sale financial assets, or financial assets held endorser, determine almost
all of the risks and rewards of ownership of the financial assets have been transferred if. Has
transferred the ownership of the financial assets of almost all the risks and rewards to the transferee,
the derecognition of the financial asset; retains ownership of the financial assets of almost all of the
risks and rewards of financial assets that are not derecognised; neither transfers nor retains
ownership of the financial assets of almost all of the risks and rewards, then continue to determine
whether the enterprise retains control of the assets and the accounting treatment in accordance with
the principles described in the preceding paragraphs.
5. Classification and measurement of financial liabilities
The Group’s financial liabilities are, on initial recognition, classified into financial liabilities at fair
value through profit or loss and other financial liabilities. For financial liabilities at fair value through
profit or loss, relevant transaction costs are immediately recognized in profit or loss for the current
period, and transaction costs relating to other financial liabilities are included in the initial recognition
amounts.
(1)Financial liabilities measured by the fair value and the changes recorded in profit or loss
The classification by which financial liabilities held-for-trade and financial liabilities designed at the
initial recognition to be measured by the fair value follows the same criteria as the classification by
which financial assets held-for-trade and financial assets designed at the initial recognition to be
measured by the fair value and their changes are recorded in the current profit or loss.For the
financial liabilities measured by the fair value and changes recorded in the profit or loss, fair values
are adopted for subsequent measurement. All the gains or losses on the change of fair value and the
expenses on dividends or interests related to these financial liabilities are recognized in profit or loss
for the current period.
（2）Other financial liabilities
Derivative financial liabilities that linked with equity instruments, which do not have a quoted price
in an active market and their fair value cannot be measured reliably, is subsequently measured by cost
Other financial liabilities are subsequently measured at amortized cost using the effective interest
method. Gains or losses arising from derecognition or amortization is recognized in profit or loss for
the current period.
6. Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation
(or part of it) is discharged or cancelled or has expired. An agreement between the Company (an
existing borrower) and existing lender to replace original financial liability with a new financial
liability with substantially different terms is accounted for as an extinguishment of the original
financial liability and the recognition of a new liability.
When the Company derecognizes a financial liability or a part of it, it recognizes the difference
between the carrying amount of the financial liability (or part of the financial liability) derecognized
the consideration paid (including any non-cash assets transferred or new financial liabilities assumed)
in profit or loss.
7. Offsetting financial assets and financial liabilities
When the Company has a legal right that is currently enforceable to set off the recognized
financial assets and financial liabilities, and intends either to settle on a net basis, or to realize the
financial asset and settle the financial liability simultaneously, a financial asset and a financial
liability shall be offset and the net amount is presented in the balance sheet. Except for the above
circumstances, financial assets and financial liabilities shall be presented separately in the balance
sheet and shall not be offset.
8. Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company
after deducting all of its liabilities. The consideration received from issuing equity instruments, net of
transaction costs, are added to shareholders’ equity. All types of distribution (excluding stock
dividends) made by the Company to holders of equity instruments are deducted from shareholders’
equity. The Group does not recognize any changes in the fair value of equity instruments.
11.Accounts Receivable
1.Accounts receivable with material specific amount and specific provisioned bad debt preparation.
The Client Identifies single amount of accounts
receivable that is not less than RMB 1 million as
account receivable that are individually significant
Judgment criteria or amount standard of material specific amount
in amount. The Client Identifies single amount of
or amount criterial：
accounts receivable that is not less than RMB 0.5
million as account receivable that are individually
significant in amount.
Making an independent impairment test. If any
objective evidence shows that it has been impaired,
Provision method with material specific amount and provision of the impairment-related losses shall be recognized
specific bad debt preparation：
according to the gap between its present value of
future cash flow less than its book value, and the
several shall be determined to withdraw the bad
debt provision. If there exists no the impairment
after the impairment test, they shall be included in a
combination of the receivables with similar risk
features so as to withdraw the bad debt provision.
2.The accounts receivable of bad debt provisions made by credit risk Group
Name Withdrawing Method
Aging Group Aging Analysis Method
In Group ,Accounts on age basis in the portfolio：
√ Applicable □ Not applicable
Aging Rate for receivables(%) Rate for other receivables(%)
Within 1 year（Included 1 year） 5.00% 5.00%
1－2 years 10.00% 10.00%
2－3 years 30.00% 30.00%
Over 3 years 50.00% 50.00%
3－4 years 50.00% 50.00%
4－5 years 50.00% 50.00%
Over 5 years 50.00% 50.00%
In Group, adopting balance percentage method for bad debt provision：
□ Applicable √ Not applicable
In Group ,adopting other method for bad debt provision：
□ Applicable √ Not applicable
(3)Account receivable with non-material specific amount but specific bad debt preparation
Reasons of Withdrawing Individual Bad Debt
There is any objective evidence shows that it has been impaired.
Provision
The impairment-related losses shall be recognized according to the gap
Withdrawing Method of Bad Debt Provision
between its present value of future cash flow less than its book value.
12. Inventories
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1.Investories class
Inventory shall include the finished products or goods available for sale during daily activities, the
products in the process of production, the stuff and material consumed during the process of production
or the services offered.
2．Valuation method of inventory issued
The company calculates the prices of its inventories according to the weighted averages method
3. Recognition Criteria for the Net Realizable Value of Different Category of Inventory and
Withdrawing Method of Inventory Falling Price Reserves
The inventory shall be measured by use of the lower between the cost and the net realizable value and
the inventory falling price reserves shall be withdrawn as per the gap of single inventory cost minus the
net realizable value at the balance sheet date. The net realizable value refers to the amounts that the
estimated sale price of inventory minus the estimated costs ready to happen till the completion of works,
the estimated selling expenses and the relevant expenses of taxation. The company shall recognize the
net realizable value of inventory based on the acquired unambiguous evidence and in view of the
purpose to hold the inventory, the influence of matters after the balance sheet date and other factors.
The net realizable value of inventory directly for sale shall be recognized according to the amounts of
the estimated sale price of the inventory minus the estimated sale expenses and the relevant expenses of
taxation during the process of normal production and operation. The net realizable value of inventory
that required to conduct processing shall be recognized according to the amounts of the estimated sale
price of the finished products minus the estimated costs ready to happen till the completion of works,
the estimated selling expenses and the relevant expenses of taxation. On the balance sheet date, the net
realizable value shall be respectively defined for the partial agreed with the contract price and others
without the contract price in the same inventory, and the amounts of the inventory falling price reserves
withdrawn or returned shall be respectively recognized in comparison with their corresponding costs.
4. Inventory System
Adopts the Perpetual Inventory System
5．Amortization method for low cost and short-lived consumable items and packaging materials
（1）Low cost and short-lived consumable items
Low cost and short-lived consumable items are amortized using immediate write-off method。
（2）Packaging materials
Packaging materials are amortized using
13.Held-for-sale assets
If the company recovers its book value mainly by sale of non-current asset (including exchange of
non-monetary assets of commercial nature and similarly hereinafter) , instead of continued use of one
non-current asset or disposal group, which shall be included into available-for-sale. In specific
standards, the following conditions shall be met at the same time: One non-current asset or disposal
group is available for sale at all times under current status depending on standard practice of selling
them in similar transactions; the company has made a resolution on the sale plan and gained definitive
purchase commitments; the sale is expected to be finished within one year. In which, the disposal group
refers to one set of assets that may be disposed as a whole along with other assets by sale or other ways
in one deal and the liability transferred and related directly to such assets. If the asset group or
combination of asset group under account title disposal group amortizes the goodwill obtained from
business combination in accordance with No.8 of Accounting Standards for Business Enterprises--
Asset Impairment, the disposal group shall include the goodwill amortized to it.
When the company’s initial measurement or re-measurement on the balance sheet date is
classified into available-for-sale non-current asset and disposal group, the book value shall be written
down to the net amount of fair value minus selling expenses if it is higher than the net amount of fair
value minus selling expenses, the write-down shall be confirmed as the assets impairment loss and
included in current profits and losses, meanwhile the available-for-sale asset depreciation reserves shall
be accrued. For the disposal group, the asset impairment loss shall be written off pro rata the book value
of each non-current asset that is applicable to No.42 of Accounting Standards for Business Enterprises:
Available-for-sale Non-current Assets, Disposal Group and Discontinued Operations (hereinafter
referred to as “Available-for-sale rule for measurement”) after deducting the book value of goodwill in
it.
If the net amount of the fair value of available-for-sale disposal group minus selling expenses
increases after the balance sheet date, the previous write-downs shall be recovered and reversed in asset
impairment loss of non-current assets that are applicable to available-for-sale rule for measurement
after being included into available-for-sale account title, the amount of reversal shall be included in
current profits and losses and increased pro rata its book value based on the proportion of the book
value of each non-current asset in the disposal group that is applicable to available-for-sale rule for
measurement except for goodwill; the book value of written-off goodwill and the asset impairment loss
confirmed before the non-current asset specified in available-for-sale rule for measurement is classified
into available-for-sale asset must not be reversed.
The available-for-sale non-current assets or the non-current assets in the disposal group shall not
be accrued depreciation or amortization, the interest of debit in available-for-sale disposal group and
other expenses shall continue to be confirmed.
The non-current asset will no longer be included into available-for-sale category or will be
removed from the available-for-sale disposal group if it or the disposal group has no longer satisfied the
conditions for classifying available-for-sale assets and measured as per the lower of: (1) book value of
the non-current asset before being classified into available-for-sale asset adjusted on the basis of the
depreciation, amortization or impairment that shall be confirmed on the assumption that the
non-current asset is not included into available-for-sale account title; (2)Recoverable amount.
14.Long-term equity investments
Long-term equity investments referred to in this section refer to the Company invested entity has
control, joint control or significant influence over the long-term equity investments. The Company
invested does not have control, joint control or significant influence over the long-term equity
investments as financial assets available for sale or at fair value and the changes included financial
assets through profit or loss.
Joint control is the Company control over an arrangement in accordance with the relevant stipulations
are common, related activities and the arrangement must be after sharing control participants agreed
to the decision-making. Significant influence is the Company s financial and operating policies of the
entity has the right to participate in decision-making, but can not control or with other parties joint
control over those policies.
1. Determination of Investment cost
The cost of a long-term equity investment acquired through business combination under common
control is measured at the acquirer's share of the combination date book value of the acquiree's net
equity in the ultimate controller's consolidated financial statements. The difference between the cost
and book value of cash paid, non-monetary assets transferred and liabilities assumed is adjusted to
capital reserves, and to retained earnings if capital reserves is insufficient. If the consideration is
transferred by way of issuing equity instruments, the face value of the equity instruments issued is
recognised in share capital and the difference between the cost of the face value of the equity
instruments issued is adjusted to capital reserves, and to retained earnings if capital reserves is
insufficient.The cost of a long-term equity investment acquired through business combination not
under common control is the fair value of the assets transferred, liabilities incurred or assumed and
equity instruments issued. (For the equity of the combined party under common control obtained
step-by-step through multiple transactions and the business combination under common control
ultimately formed, the company should respectively dispose all the transactions if belong to the
package deal. For the package deal, all the transactions will be conducted the accounting treatment as
the deal with acquisition of control. For the non-package deal, the shares of the book value of the
stockholders’ equity/owners’ equity of the combined party in the consolidated financial statements of
the ultimate control party shall be as the initial investment cost of the long-term equity investment,
and the capital reserves shall be adjusted for the difference between the initial investment cost of
long-term equity investment and the sum of the book value of long-term equity investment before
merging and that of new consideration payment obtained on the merger date, or the retained earnings
shall be adjusted if the capital reserves are insufficient to offset. As for the equity investment held
before the merger date, the accounting treatment will not be conducted temporarily for other
comprehensive income accounted by equity method or confirmed for the financial assets available for
sale.)
All expenses incurred directly associated with the acquisition by the acquirer, including expenditure
of audit, legal services, valuation and consultancy and other administrative expenses, are recognised
in profit or loss for the period during which the acquisition occurs. For the merger of enterprises not
under the same control through gaining the shares of the combined enterprise by multiple steps of
deals, it shall deal with it in the following two ways depending on that if it belongs to "a package
deal": if it belongs to "a package deal", it shall deal with all the deals as one obtaining the control
power; if it does not belong to "a package deal", it shall, on the date of merger, regard the sum of
book value of the owner’s original equity of the merged enterprise and the newly increased
investment cost as the initial cost of the long-term equity investment. For the shares originally held
by this enterprise accounted for by weighted equity method, the relevant other comprehensive income
shall not be accounted for temporarily.If the equity investment held originally can be classified as the
financial assets for sale, the difference between the fair value and the book value, and the variation in
the accumulative fair value of other comprehensive returns recorded originally will be transferred into
the current profits and losses.
All expenses incurred directly associated with the acquisition by the acquirer, including expenditure
of audit, legal services, valuation and consultancy and other administrative expenses, are recognised
in profit or loss for the period during which the acquisition occurs.
Long-term equity investments acquired not through business combination are measured at cost on
initial recognition. Depending on the way of acquisition, the cost of acquisition can be the total cash
paid, the fair value of equity instrument issued, the contract price, the fair value or book value of the
assets given away in the case of non-monetary asset exchange, or the fair value of the relevant
long-term equity investments. The cost of acquisition of a long-term equity investment acquired not
through business combination also includes all directly associated expenses, applicable taxes and fees,
and other necessary expenses. When the significant impact or the joint control but non-control on the
invested party can be implemented due to the additional investment, the long-term equity investment
cost is the sum of the fair value of the equity investment originally held and the new investment costs
based on the recognition of “Accounting Standards for Enterprises No.22 – Recognition and
Measurement of Financial Instruments”.
2. Subsequent Measurement
To be invested joint control ( except constitute common operator ) or long-term equity investments
significant influence are accounted for using the equity method. In addition, the Company's financial
statements using the cost method of accounting for long-term equity can exercise control over the
investee.
(1)Cost method of accounting for long-term equity investments
Under the cost method, a long-term equity investment is measured at initial investment cost. Except
for cash dividends or profits declared but not yet paid that are included in the price or consideration
actually paid upon acquisition of the long-term equity investment, investment income is recognized in
the period in accordance with the attributable share of cash dividends or profit distributions declared
by the investee.
(2)Equity method of accounting for long-term equity investments
When using the equity method, the initial investment cost of long-term equity investment exceeds th
e investor's net identifiable assets of the fair share of the investment value, do not adjust the initial in
vestment cost of long-term equity investment; the initial investment cost is less than the investee uni
t share of identifiable net assets at fair value, the difference is recognized in profit or loss, while the
long-term equity investment adjustment costs.
Where the initial investment cost of a long-term equity investment exceeds the investing enterprise’s
interest in the fair values of the investee’s identifiable net assets at the time of acquisition, no
adjustment shall be made to the initial investment cost. The carrying amount of an long-term equity
investment measured using the equity method is adjusted by the Company's share of the investee's net
profit and other comprehensive income, which is recognised as investment income and other
comprehensive income respectively. The carrying amount of an long-term equity investment
measured using the equity method is reduced by profit distribution or cash dividends announced by
the investee. The carrying amount of an long-term equity investment measured using the equity
method is also adjusted by the investee's equity movement other than net profit, other comprehensive
income and profit distribution, which is adjusted to capital reserves。The net profit of the investee is
adjusted by the fair value of the investee's identifiable assets as at acquistion. The financial statements
and hence the net profit and other comprehensive income of an investee which does not adopt
accounting policies or accounting period uniform with the Company is adjusted by the Company's
accounting policies and accounting period. The Company's share of unrealised profit or loss arising
from related party transactions between the Company and an associate or joint venture is deducted
from investment income. Unrealised loss arising from related party transactions between the
Company and an associate or joint venture which is associated with asset impairment is not adjusted.
Where assets transferred to an associate or joint venture which form part of the Company's
investment in the investee but which does not enable the Company obtain control over the investee,
the cost of the additional investment acquired is measured at the fair value of assets transferred and
the difference between the cost of the additional investment and the book value of the assets
transferred is recognised in profit or loss. Where assets transferred to an associate or joint venture
form an operation, the difference between the consideration received and the book value of the assets
transferred in recognised in profit or loss. Where assets transferred from an associate or joint venture
form an operation, the transaction is accounted for in accordance with CAS 20 - Business
Combination, any gain or loss is reocgnised in profit or loss.
The Company's share of an investee's net loss is limited by the sum of the book value of the
long-term equity investment and other net long-term investments in the investees. Where the
Company has obligation to share additional net loss of the investee, the estimatedshare of loss
recognised as accrued liabilities and investment loss. Where the Company has unrecognised share of
loss of the investee when the investee generates net profit, the Company's unrecognised share of loss
is reduced by the Company's share of net profit and when the Company's unrecognised share or loss
is eliminated in full, the Company's share of net profit, if any, is recognised as investment income.
(3)Acquisition of minority interest
The difference between newly increased equity investment due to acquisition of minority interests
and portion of net asset cumulatively calculated from the acquisition date is adjusted as capital
reserve. If the capital reserve is not sufficient to absorb the difference, the excess are adjusted against
returned earnings.
(4)Disposal of long-term equity investment
Where the parent company disposes long-term investment in a subsidiary without a change in control,
the difference in the net asset between the amount of disposed long-term investment and the amount
of the consideration paid or received is adjusted to the owner’s equity. If the disposal of long-term
investment in a subsidiary involves loss of control over the subsidiary, the related accounting policies
in Note applies. For disposal of long-term equity investments in any situation other than the
fore-mentioned situation, the difference between the book value of the investment disposed and the
consideration received is recognised in profit or loss.
The investee's equity movement other than net profit, other comprehensive income and profit
distribution is reocgnised in profit or loss proportionate to the disposal.
Where a long-term equity investment is measured by the equity method both before and after part
disposal of the investment, cumulative other comprehensive income relevant to the investment
recognised prior to the acquistion is treated in the same manner that the investee disposes the relevant
assets or liabilities proportionate to the disposal. The investee's equity movement other than net profit,
other comprehensive income and profit distribution is reocgnised in profit or loss proportionate to the
disposal.
Where a long-term equity investment is measured at cost both before and after part disposal of the
investment, cumulative other comprehensive income relevant to the investment recognised, as a result
of accounting by equity method or recognition and measurement principles applicable to financial
instruments, prior to the Company's acquisition of control over the investee is treated in the same
manner that the investee disposes the relevant assets or liabilities and recognised in profit or loss
proportionate to the disposal.The investee's equity movement other than net profit, other
comprehensive income and profit distribution, as a result of accounting by equity method, is
reocgnised in profit or loss proportionate to the disposal.
Where the Company's control over an investee is lost due to partial disposal of investment in the
investee and the Company continues to have significant influence over the investee after the partial
disposal, the investment in measured by the equity method in the Company's separate financial
statements; where the Company's control over an investee is lost due to partial disposal of investment
in the investee and the Company ceases to have significant influence over the investee after the
partial disposal, the investment in measured in accordance with the recognition and measurement
principles applicable to financial instruments in the Company's separate financialstatements and the
difference between the fair value and the book value of the remaining investment at the date of loss of
control is recognised in profit or loss. Cumulative other comprehensive income relevant to the
investment recognised, as a result of accounting by equity method or recognition and measurement
principles applicable to financial instruments, prior to the Company's acquisition of control over the
investee is treated in the same manner that the investee disposes the relevant assets or liabilities on
the date of loss of control. The investee's equity movement other than net profit, other comprehensive
income and profit distribution, as a result of accounting by equity method, is reocgnised in profit or
loss when control is lost. Where the remaining investment is measured by equity method, the
fore-mentioned other comprehensive income and other equity movement are recognised in profit or
loss proportionate to the disposal; Where the remaining investment is measured in accordance with
the recognition and measurement principles applicable to financial instruments, the fore-mentioned
other comprehensive income and other equity movement are recognised in profit or loss in full.
Where the Company's joint control or significant influence over an investee is lost due to partial
disposal of investment in the investee,the remaining investment in the investee is measured in
accordance with the recognition and measurement principles applicable to financial instruments, the
difference between the fair value and the book value of the remaining investment at the date of loss of
joint control or significant influence is recognised in profit or loss.Cumulative other comprehensive
income relevant to the investment recognised, as a result of accounting by equity method, prior to the
partial disposal is treated in the same manner that the investee disposes the relevant assets or
liabilities on the date of loss of joint control or significant influence. The investee's equity movement
other than net profit, other comprehensive income and profit distribution is reocgnised in profit or
loss when joint control or significant influence is lost.
Where the Company's control over an investee is lost through multiple disposals and the multiple
disposals shall be viewed as one single transaction, the multiple disposals is accounted for one single
transaction which result in the Company's loss of control over the investee. Each difference between
the consideration received and the book value of the investment disposed is recognised in other
comprehensive income and reclassified in full to profit or loss at the time when control over the
investee is lost.
15.Investment property
The measurement mode of investment property
The investment property of the company includes the leased land use rights, the leased buildings,
the land use rights held and prepared to transfer after appreciation.
The company shall adopt the cost mode to measure the investment property.
2. Depreciation or Amortization Method by Use of Cost Mode
The leased buildings of the investment property in the company shall be withdrawn the depreciation
by the service life average method, and the depreciation policy is the same with that of the fixed
assets. The land use rights held and prepared to transfer after appreciation in the investment property
shall be amortized by the line method, and the specific accounting policy is same with that of the
intangible assets.
16.Fixed assets
1．The conditions of recognition
Fixed assets refers to the tangible assets that are held for the sake of producing commodities,
rendering labor service, renting or business management and their useful life is in excess of one
fiscal year. The fixed assets can be recognized when the following requirements are all met: (1) the
economic benefits relevant to the fixed assets will flow into the enterprise. (2) the cost of the fixed
assets can be measured reliably.The fixed assets of the company include the houses and buildings,
the decoration of the fixed assets, the machinery equipment, the transportation equipment, the
electronic instrument and other devices.
2．The method for depreciation
The method for Expected useful life
Category Estimated residual value Depreciation
depreciation （Year）
House and Straight-line method
Building- 35 years 4% 2.74%
Production
House and Building-Non- Straight-line method 40 years 4% 2.40%
Production
Decoration of Fixed Straight-line method
10 years 10%
assets
Machinery and Straight-line method
10-14 years 4% 9.60%-6.86%
equipment
Transportation Straight-line method
8 years 4% 12%
equipment
Electronic equipment Straight-line method 8 years 4% 12%
Other equipment Straight-line method 8 years 4% 12%
3．Cognizance evidence and pricing method of financial leasing fixed assets
(1) Recognition Criteria of the Fixed Assets under Financing Lease
The financing lease shall be recognized if the following one or several criteria are met: ① the
ownership of the leasing assets shall be transferred to the tenant when the expiration of lease term.
② the tenant has the option to purchase the leasing assets, and the made purchase price is expected
to be far less than the fair value of the leasing assets in the implementation of the option. Thus, it
can be reasonably recognized that the tenant will implement the option on the lease date. ③ the
ownership of assets is not transferred, but the lease term shall be the most of the life of the lease
assets. ④ the least present value of the lease payment of the tenant and the least present value of
the lease receipts on the lease date almost equal to the fair value of the leasing assets on the lease
date respectively. ⑤ the leasing assets have the special nature, and only the tenant can use if there
is no major modifications.
(2) Valuation of Fixed Assets Acquired under Finance Leases: the fixed assets acquired under
finance leases shall be book kept according to the lower between the fair value of the leasing assets
and the least lease payment on the lease date.
(3) Depreciation Method of Fixed Assets Acquired under Finance Leases: the depreciation shall be
withdrawn for the fixed assets acquired under finance leases as per the depreciation policy of own
fixed assets.
17.Construction in progress
1. The projects under construction shall be recognized when the economic benefits may flow into and
the cost can be reliably measured. Meanwhile, the projects under construction shall be measured
according to the actual cost occurred before the assets are built to achieve the expected usable
condition.
2. The projects under construction shall be transferred into the fixed assets according to the actual
project costs when the expected usable condition achieved. For the expected usable condition achieved
while the final accounts for completed projects not handled yet, the projects shall be transferred into the
fixed assets as per the estimated value. After the final accounts for completed projects handled, the
original estimated value shall be adjusted as per the actual cost, but the original withdrawn depreciation
shall not be adjusted again.
18.Borrowing costs
1. Recognition principles for capitalizing of loan expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or
production of asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of
related asset. Other borrowing expenses are recognized as expenses according to the occurred
amount, and accounted into gain/loss of current term.
2. Duration of capitalization of Loan costs
(1).When a loan expense satisfies all of the following conditions, it is capitalized:
1. Expenditures on assets have taken place.
2. Loan costs have taken place;
3. The construction or production activities to make assets to reach the intended use or sale of state
have begun.
（2）Capitalization of borrowing costs is suspended during periods in which the acquisition,
construction or production of a qualifying asset is interrupted by activities other than those necessary
to prepare the asset for its intended use or sale, when the interruption is for a continuous period of
more than 3 months. Borrowing costs incurred during these periods recognized as an expense for the
current period until the acquisition, construction or production is resumed.
（3）When the construction or production meets the intended use or sale of state of capitalization
conditions, the Loan costs should stop capitalization.
3. Computation Method for Capitalization Rate and Amount of Borrowing Costs
With regard to the special borrowings for the purchase and construction of qualified assets, the
capitalized interest amount shall be recognized according to the amount of the interest cost for the
special borrowings actually occurred during the current period (including the amortization of discount
or premium recognized as per the effective interest method) minus the interest income acquired after
the borrowings deposit in bank or the investment income obtained from the temporary investment. For
the general borrowings for the purchase and construction of qualified assets, the capitalized interest
amount of the general borrowings shall be computed and recognized according to the weighted average
of accumulative asset expense beyond the expense of the special borrowings, multiplying the
capitalization rate of general borrowings.
19.Biological Assets
Not applicable
20.Oil & Gas assets
Not applicable
21.Intangible assets
1. Valuation Method, Service Life and Impairment Test of Intangible Assets
(1) The intangible assets include the land use rights, the professional technology and the software,
which are conducted the initial measurement as per the cost.
(2) The service life of intangible assets is analyzed and judged when of the company acquires the
intangible assets. For the finite service life of the intangible assets, the years of service life or the
quantity of service life formed and the number of similar measurement unit shall be estimated. If the
term of economic benefits of the intangible assets brought for the company is not able to be foreseen,
the intangible assets shall be recognized as that with the indefinite service life.
(3) Estimation Method of Service life of Intangible Assets
1) For the intangible assets with the finite service life, the company shall generally consider the
following factors to estimate the service life: ① the normal service life of products produced with the
assets, and the acquired information of the service life of similar assets. ② the estimation of the
current stage conditions and the future development trends in the aspects of technology and craft. ③
the demand of the products produced by the assets or the offered services in the market. ④ the
expectation of actions adopted by current or potential competitors. ⑤ the expected maintenance
expense for sustaining the capacity to economic benefits brought by the assets and the ability to the
relevant expense expected. ⑥ the relevant law provision or the similar limit to the control term of the
assets, such as the licensed use term and the lease term. ⑦ the correlation with the service life of
other assets held by the company.
2) Intangible Assets with Indefinite Service Life, Judgment Criteria on Indefinite Service Life and
Review Procedure of Its Service Life
The company shall be unable to foresee the term of economic benefits brought by the assets for the
company, or the indefinite term of intangible assets recognized as the indefinite service life of
intangible assets.
The judgment criteria of Indefinite service life: ① as from the contractual rights or other legal rights,
but the indefinite service life of contract provision or legal provisions. ② unable to judge the term of
economic benefits brought by the intangible assets for the company after the integration of
information in the same industry or the relevant expert argumentation.
At the end of every year, the review should be made for the service life of the intangible assets with
the indefinite service life, and the relevant department that uses the intangible assets, shall conduct
the basic review by the method from up to down, in order to evaluate the judgment criteria of the
indefinite service life if there is the change.
(4) Amortization Method of Intangible Assets Value
The intangible assets with the finite service life shall be systematically and reasonably amortized
according to the expected implementation mode of the economic benefits related to the intangible
assets during the service life, and the line method shall be adopted to amortize for the intangible
assets unable to reliably recognize the expected implementation mode. The specific service life is as
follows:
Items Amortization life time（Year）
Land use right 50 years
Proprietary technology 15 years
Software 5 years
The intangible assets with the indefinite service life shall not be amortized, and the company shall make
the review of the service life of the intangible assets during every accounting period.
(5) If there is the impairment for the intangible assets with the definite service life on the balance sheet
date, the corresponding impairment provision shall be withdrawn according to the difference between
the book value and the recoverable amount. The intangible assets with the indefinite service life and
without the usable condition shall be conducted the impairment test every year whether the impairment
exists.
2. Accounting Policy of Internal Research and Development Expenditure
The expenditure for internal research and development project in the study stage shall be recorded
into the current profits and losses when occurring. The expenditure for internal research and
development project in the development stage shall be recognized as the intangible assets when the
following requirements are simultaneously met: (1) the completion of the intangible assets is
available for use or sale, and feasible in the technology. (2) the intention to complete the intangible
assets and use or sale. (3) the method for the economic benefits produced by the intangible assets,
including the evidence that shows there exists the market for the products generated from the
intangible assets or the intangible assets have the market. The intangible assets are used internally
which shows the serviceability. (4) there are sufficient technology, financial resources and other
resources to support the completion of the development of the intangible assets, and there is ability
to use or sell the intangible assets. (5) the expenditure belong to the development stage of the
intangible assets can be reliably measured.
The specific criteria for the division of the internal research and development projects at the
research stage and the development stage of the company is as follows: (1) the investigation stage
planned to obtain the new technology and knowledge, shall be recognized as the research stage,
which has the features of planning and exploration. (2) before the commercial manufacture and use,
the research results or other knowledge should be applied for the plan or design, in order to produce
the new or improved stages with substantial materials, devices and products, which should be
recognized as the development stage, and this stage has the features of pertinence and more
possibility to create the achievement.
22.Long-term Assets Impairment
The company shall make judgment of the long-term assets including the long-term equity
investment, the investment property measured by the cost mode, the fixed assets and the projects
under construction if there is possible impairment on the balance sheet date. If there exists the
evidence shows that the long-term assets have the impairment, the impairment test should be
conducted, and the recoverable amount should be estimated. The impairment shall be confirmed if
there exists after the comparison of the estimated recoverable amount of the assets and its book
value, and if the assets impairment provision shall be withdrawn to recognize the corresponding
impairment losses. The estimation of the recoverable amount of assets should be confirmed
according to the higher one between the net amount of the fair value minus the disposal costs and
the present value of the cash flow of assets expected in the future.
The company shall conduct the impairment test at least every year for the goodwill established by
the business combination and the intangible assets with the indefinite service life whether there
exists the impairment.
The impairment loss of long-term assets after recognized shouldn’t be reversed in the future
accounting period.
23.Long-term amortizable expenses
Deferred charges represent expenses incurred that should be borne and amortized over the current
and subsequent period (together of more than one year).
The long-term unamortized expense shall be bookkept as per the actual amount occurred, and
shall be averagely amortize within the benefit period or the specified period. If the long-term
unamortized expense can’t make the benefits for the future accounting period, the amortized value
of the unamortized project shall all be transferred into the current profits and losses.
24.Remuneration
1. Accounting Treatment Method of Short-term Compensation
During the accounting period of service provision of staff, the company shall regard the actual
short-term compensation as the liability and record into the current profits and losses or the
relevant assets cost as per the beneficiary. Of which, the non-monetary welfare shall be measured
as per the fair value.
2. Accounting Treatment Method of Severance Benefit Plans
The severance benefit plans can be divided into the defined contribution plan and the defined
benefit plan according to the risk and obligation borne.
(1) The Defined Contribution Plan
The contribution deposits that paid to the individual subject for the services provided by the staffs
on the balance sheet date during the accounting period, shall be recognized as the liability, and
recorded into the current profits and losses or the relevant asset costs as per the beneficiary.
(2) The Defined Benefit Plan
The defined benefit plan is the severance benefit plans with the exception of the defined
contribution plans.
1) Based on the expected cumulative welfare unit method, the company shall adopt unbiased and
mutually consistent actuarial assumptions to make evaluation of demographic variables and
financial variables, measure and define the obligations arising from the benefit plan, and determine
the period of the relevant obligations. The company shall discount all the defined benefit plan
obligations, including the obligation within twelve months after the end of the annual report during
the expected services provision of employee. The discount rate adopted in discounting shall be
recognized according to the bonds matched with the defined benefit plan obligation term and the
currency at the balance sheet date or the market return of high-quality corporate bonds in the active
market.
2) If there exist the assets for the defined benefit plan, the deficit or surplus arising from the present
value of the defined benefit plan obligations minus the fair value of the defined benefit plan assets
are recognized as the net liability or the net assets of the defined benefit plan. If there exists the
surplus of the defined benefit plan, the lower one between the surplus of the define benefit plan and
the upper limit of assets shall be used to measure the net assets of the defined benefit plan. The upper
limit of assets refers to the present value of economic benefits obtained from the refund of the
defined benefit plans or the reduction of deposit funds of future defined benefit plans.
3) At the end of period, the employee’s payroll costs arising from the defined benefit plan are
recognized as the service costs, the net interests on the net liabilities or the net assets of the defined
benefit plan, and the changes caused by the net liabilities and the net assets of the defined benefit
plan that re-measured. Of which, the service costs and the net interests on the net liabilities or the net
assets of the defined benefit plan shall be recorded into the current profits and losses or the relevant
assets costs, the changes caused by the net liabilities and the net assets of the defined benefit plan
that re-measured shall be recorded into other comprehensive incomes, which should not be switched
back to the profits and losses during the subsequent accounting period, but the amount recognized
from other comprehensive incomes can be transferred within the scope of the rights and interests.
4) The profit or loss of one settlement shall be recognized when settling the defined benefit plan.
3. Accounting Treatment Method of Demission Welfare
The employee compensation liabilities generated by the demission welfare shall be recognized on
the early date and recorded into the current profits and losses: (1) when the company can’t withdraw
the demission welfare provided due to the rundown suggestion or the termination of labor relations
plans. (2) when the company recognizes the costs or the expenses related to the reorganization of
demission welfare payment.
The earlier one between when the company can’t withdraw the rundown suggestion or the
termination of labor relations plans at its side and when the costs relevant to the recombination of
dismission welfare payment, shall be recognized as the liabilities arising from the compensation
due to the termination of labor relations with staff and shall be recorded into the current profits
and losses. Then company shall reasonably predict and recognize the payroll payable arising from
the dismission welfare. The dismission welfare, which is expected to finish the payment within
twelve months after the end of the annual report recognized, shall apply to the relevant provisions
of short-term compensation. The dismission welfare, which is expected to be unfinished for the
payment within twelve months after the end of the annual report recognized, shall apply to the
relevant provisions of short-term compensation, shall apply to the provisions related to other
long-term employee benefits.
4. Accounting Treatment Method of Other Long-term Employee Benefits
If other long-term employee benefits of employees provided by the company meet the conditions
of the defined contribution plan, the accounting treatment shall be made in accordance with the
defined contribution plan. Except for these, other long-term benefits shall be made the accounting
treatment according to the defined benefit plan, but the changes arising from the re-measurement
of net liabilities or net assets of other long-term employee benefits shall be recorded into the
current profits and losses or the relevant assets costs.
25. Estimated Liabilities
1. Recognition Criteria of Estimated Liabilities
The liabilities shall be recognized when external guarantee, pending litigation or arbitration,
product quality assurance, staff reduction plan, loss contract, recombination obligation, disposal
obligation of the fixed assets and other pertinent businesses all meet the following requirements:
(1) The obligation is the current obligation borne by the company.
(2) The implementation of the obligation may cause the economic benefits out of the enterprise.
(3) The amount of the obligation can be measured reliably.
2. Measurement Method of Estimated Liabilities
The estimated liabilities shall be made the initial measurement according to the best estimate of
the expenditure required to settle the present obligation. There is the continuous scope for the
required expenditure, and the best estimate with the same possibilities resulted from various
outcomes within the scope shall be recognized as per the intermediate value. The best estimate
should be recognize according to the following methods:
(1) The best estimate shall be recognized as per the most possible amount if there are matters
involved in the single item.
(2) The best estimate shall be calculated and recognized as per the possible amount if there are
matters involved in the multiple item.
If the company pays all the expenses for paying off the estimated liabilities, or partial estimates
are compensated by the third party or other parties, the compensation amount should be separately
recognized as the assets when the receipt of the compensation amount is basically determined.
Meanwhile, the determined compensation amount shall not exceed the book value of the estimated
liabilities recognized.
The company shall make review of the book value of estimated liabilities at the balance sheet date.
If there is conclusive evidence that the book value cannot really reflect the current best estimate,
the adjustment shall be made for the book value in accordance with the current best estimate.
26. Share payment
1.Accounting Treatment Methods of Share Payment
Share payment is a transaction which is for obtaining the service provided by employees or
other parties, where thus the equity instrument is granted , or for bearing the liability confirmed
basing on the equity instrument. Share payment is divided into the payment settled by equities and
the payment settled by cash.
(1)Shared Payment settled by Equities
The share payment settled by equities, which is used for exchanging the service provided by
employees, will be measured according to the fair value of the equity instrument granted to
employees on date of grant. The amount of such fair value, under the situation that the rights can
only be exercised after the service is finished and the set performance is achieved within the
waiting period, and basing on the optimum estimation for the number of equity instrument which
exercise rights within the waiting period, will be measured according to straight-line method and
counted into relevant costs and expenses. When the rights can be exercised immediately after
being granted, the payment will be counted into relevant costs and expenses, and the capital
reserve will be increased correspondingly.
On each and every balance sheet date within the waiting period, the Company will make
optimum estimations according to the newly-obtained subsequent information after the changes
occurred in the number of employees who exercise rights so as to modify the predicted number of
the equity instrument of exercising rights. The influence from above-mentioned estimations will
be counted into relevant costs and expenses at the current period, and the corresponding
adjustment will be made for the capital reserve.
If the fair value of the other parties’ service can be reliably measured, the share-based payment
settled by equities which is used for exchanging the service of other parties will be measured
according to that fair value on date of acquisition. If not, but the fair value of the equity instrument
can be reliably measured, the payment will be counted according to the fair value of the equity
instrument on date of service acquisition, and it will be counted into relevant costs and expenses,
and the equity of the shareholders will be increased correspondingly.
(2) Share Payment settled by Cash
The share payment settled by cash will be measured according to the fair value of the liability
confirmed basing on the shares borne by the Company and other equity instruments. If the rights
can be exercised immediately after being granted, the payment will be counted into relevant costs
or expenses and the liability will be increased correspondingly. If the rights can only be exercised
after the situation that service within the waiting period is completed and set performance is
achieved, the service obtained at the current period,according to the fair value amount of the
liability borne by the Company, and basing on the optimum estimation for the condition of
exercising rights, will be counted into costs or expenses on each and every balance sheet date
during the waiting period, and the liability will be increased correspondingly.
Each and every balance sheet date and settlement before relevant liability settlement, the fair
value of liability will be remeasured, of which changes occurred will be counted into the current
period.
2.Relevant Accounting Treatment of Modification and Termination for Share-based Payment
Plan
When the Company modifies the share payment plan, if the fair value of the equity instrument
granted is increased after the modification, the increase in the service obtained will be
correspondingly confirmed according to the increase in the fair value of equity instrument. The
increase in the fair value of equity instrument means the balance between the equity instrument
before modification and the equity instrument after modification on modification date. If decrease
occurred in the total fair value of the equity instrument after the modification or methods which
are unbeneficial to employees are adopted in the modification, accounting treatment will still
continue to be made for the service obtained, and such changes will be regarded as changes that
have never occurred unless the Company has canceled partial or all equity instruments.
During the waiting period, if the granted equity instrument is cancelled, the company will
treat the cancelled equity instrument as the accelerated exercise of power, and immediately
include the balance that should be recognized in the remaining waiting period into the current
profit and loss, and simultaneously confirm the capital reserve. If the employee or other party can
choose to satisfy the non-exercisable condition but not satisfied in the waiting period, then the
company will treat it as cancellation of the granted equity instrument.
3. Accounting treatment involving the share payment transaction between the Company and
the shareholders or the actual controller of the Company
Where involves the share payment transaction between the Company and the shareholders or
the actual controller of the Company and one of the parties of the settlement company and the
service-accepting company is within the company and the other is not within the company, then
the company performs the accounting treatment in the consolidated financial statements of the
company according to the following provisions:
(1) If the settlement company settles in its own equity instrument, then it treats the equity
payment transaction as the equity-settled equity payment; otherwise, it treats as the cash-settled
equity payment.
If the settlement company is an investor to the service-accepting company, it shall be
recognized as a long-term equity investment in the service-accepting company in accordance with
the fair value of the equity instrument or the fair value of the liability it is assumed to bear on the
grant date, and the capital reserve (other capital reserve) or liabilities shall be recognized at the
same time.
(2) If the service-accepting company has no settlement obligation or confers its own equity
tools on the employees of the company, then such equity payment transaction shall be treated as
equity-settled equity payment; if the service-accepting company has the settlement obligation and
confers the employees of the company with not its own equity instrument, then such equity
payment transaction shall be treated as cash-settled equity payment;
In the case of the equity payment transaction occurs between the companies within the
company, and the service-accepting company and the settlement company are not the same
company, then the confirmation and measurement of the equity payment transaction shall be
carried out respectively in the financial report of the service-accepting company and the settlement
company, with the same analogy of the above-said principle.
27. Other financial instruments such as preferred stocks and perpetual bonds
28. Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1. Recognition Principle of Revenue
(1) The Goods for Sale
The revenue of the goods for sale shall be recognized when the following requirements are met
simultaneously: the transfer of main risks and rewards on ownership of the goods to the buyers, the
continual management rights related to ownership no longer retained by the company and the
effective control of the sold goods no longer implemented, the reliable measurement of the revenue
amount, the possible inflow of the relevant economic benefits, and the reliable measurement of the
relevant costs incurred or to be incurred.
(2) The Service Provision
If the provided services transaction results can be reliably estimated at the balance sheet date (the
reliable measurement of the revenue amount, the possible inflow of the relevant economic benefits,
the reliable recognition of the completion schedule of transaction, and the reliable measurement of
the relevant costs incurred or to be incurred in the transaction), the company shall recognize the
relevant service incomes according to the completion percentage method and recognized the
completion schedule of the provided service transaction according to the proportion of the costs
occurred accounting for the total estimated costs. If the provided services transaction results cannot
be reliably estimated at the balance sheet date and the occurred service costs can be expected to have
compensation, the company shall recognize to provide the service revenue according to the
occurred service cost amount and transfer the service costs as per the same amount. If the occurred
service costs cannot be expected to have compensation, the occurred service costs shall be recorded
into the current profits and losses and not be recognized as the service revenue.
(3) The Abalienation of the Right to Use Assets
The revenue of abalienation of the right to use assets shall be recognized when the abalienation of
the right to use assets meets the requirements of the possible inflow of the relevant economic
benefits and the reliable measurement of revenue amount. The interest income shall be calculated
and determined according to time and actual interest rate of the monetary capital of the company
used by others, and the royalty revenue shall be measured and determined in accordance with the
charging time and method appointed in the relevant contract or agree.
2. The Specific Recognition Method of Revenue
The company mainly sells the polaroid, textiles and other products. The revenue of the sale of
products in domestic market shall be recognized after the following requirements are met: The
company has agreed to deliver the goods to the purchaser under the contract and the revenue amount
of product sales has been determined, the payment for goods has been withdrawn or the payment
vouchers has been obtained and related economic benefits are likely to inflow, and the costs related
to the products can be measured reliably. The revenue of the sale of products in foreign market shall
be recognized after the following requirements are met: The company has made customs clearance
and departure from port under the contract, the bill of landing has obtained and the revenue of the
sale of products has been recognized, the payment for goods has been withdrawn or the payment
vouchers has been obtained and related economic benefits are likely to inflow, and the costs related
to the products can be measured reliably.
29.Government subsidy
1. Judgment Basis and Accounting Treatment Method of Government Grants related to Assets
The government grants of long-term assets that obtained, used for construction or formed by other
ways, shall be recognized as the government subsidy related to the assets. The government grants
related to assets are recognized as the deferred income, equally distributed within the service life
of the relevant assets, and recorded into the current profits or losses.
2. Judgment Basis and Accounting Treatment Method of Government subsidy related to Income
The government subsidy related to income that used for the compensation of the related expenses
or losses in subsequent period, shall be recognized as the deferred income and recorded into the
current profits and losses during the period of the confirmation of relevant expenses. The relevant
expenses or losses occurred for the purpose of compensation shall be directly recorded into the
current profits and losses. Government grants related to the company's daily activities are included
in other income; those unrelated to the daily activities of the company are included in
non-operating income.
30.The Deferred Tax Assets / The deferred Tax Liabilities
1. Temporary Difference
The temporary difference includes the difference of the book value of assets and liabilities and the
tax basis, and the difference of the book value and the tax basis that no confirmation of assets and
liabilities but able to confirm the tax basis as per the provisions of tax law. The temporary
difference can be classified into the taxable temporary difference and the deductible temporary
difference.
2. Recognition Basis of Deferred Tax Assets
For the deductible temporary difference, the deductible loss and the tax payment offset, the
company shall recognize the deferred tax assets arising from the future taxable income that
obtained to deduce the deductible temporary difference, the deductible loss and the tax payment
offset.
The deferred tax assets with the following features and arising from the initial recognition of
assets or liabilities in the transaction shall not be recognized: (1) the transaction is not the business
combination. (2) the transaction doesn’t influence the accounting profits and the taxable incomes
(or the deductible losses).
The company shall recognize the corresponding deferred tax assets for the deductible temporary
difference related to the investment of subsidiaries, cooperative enterprises and joint ventures if
the following requirements are simultaneously met: (1) the temporary difference is possible to be
reversed in the foreseeable future. (2) the taxable income used to offset the deductible temporary
difference is possible to be obtained in the future.
3. Recognition Basis of Deferred Tax Liabilities
All the taxable temporary differences shall be recognized as the deferred tax liabilities.
But the company shall not recognize the taxable temporary differences arising from the following
transactions as the deferred tax liabilities: (1) the initial recognition of goodwill. (2) the initial
recognition of assets or liabilities arising from the transactions with the following features: this
transaction is not the business combination, and the transaction doesn’t influence the accounting
profits and the taxable incomes (or the deductible losses).
The company shall recognize the corresponding deferred tax liabilities for the taxable temporary
difference related to the investment of subsidiaries, cooperative enterprises and joint ventures.
Except that the following requirements are simultaneously met: (1) the investment enterprise can
control the reversal time of the temporary difference. (2) the temporary difference is possible to
not be reversed in the foreseeable future.
4. Impairment of Deferred Tax Assets
The company shall review the book value of the deferred tax assets at the balance sheet date. If it
is not possible to obtain sufficient taxable income for the reduction of the benefit of the deferred
tax assets in the future, the book value of the deferred tax assets shall be deduced. Except that the
deferred tax assets and the reduction amount are recorded into the owner’s equity when the
original recognition, others shall be recorded into the current income tax expense. The book value
of the deferred tax assets reduced can be recovered when sufficient taxable income is possibly
obtained.
5. Income Tax Expense
The income tax expense should include the current income tax and the deferred income tax.
Other comprehensive income or the current income tax and the deferred income tax related to the
transactions and items directly recorded into the stockholders’ equity, shall be recorded into other
comprehensive incomes or the stockholders’ equity, and the book value of goodwill shall be
adjusted by the deferred income tax arising from the business combination, but the rest of the
current income tax and the deferred income tax expense or income shall be recorded into the
current profits and losses.
31.Lease
1. Accounting Treatment Method of Operating Lease
When the company is as the tenant, the rental within the lease term shall be recorded into the
relevant assets cost or recognized as the current profits and losses as per the line method, and the
initial direct expense occurred shall be directly recorded into the current profit and loss. The
contingent rental shall be recorded into the current profit and loss once the actual occurrence.
When the company is as the leaser, the rental within the lease term shall be recognized as the
current profits and losses as per the line method, and the initial direct expense occurred shall be
directly recorded into the current profit and loss, except that the large amounts are capitalized and
recorded into the profit and loss by stages. The contingent rental shall be recorded into the current
profit and loss once the actual occurrence.
2. Accounting Treatment Method of Finance Lease
When the company is as the tenant, the company shall recognize the less one between the fair value
of leasing assets and the present value of minimum lease payment at the lease commencement date
as the book value of rented assets, recognize the minimum lease payment as the book value of the
long-term payables, and the undetermined fiancéexpense of the difference and the initial direct
costs occurred shall be recorded into the leasing asset value. During each lease period, the current
financing charges shall be measured and recognized by the effective interest method.
When the company is as the leaser, the company shall recognize the sum of minimum lease
receivables and initial direct expense at the lease commencement date as the book value of finance
lease receivables, and record the unguaranteed residual value. Meanwhile, the company shall
recognize the difference between the sums of minimum lease receivables, minimum lease
receivables and unguaranteed minus the sum of the present value as the unrealized financing income.
During each lease period, the current financing charges shall be measured and recognized by the
effective interest method.
32. Other important accounting policies and accounting estimates
33.Change of main accounting policies and estimations
(1)Change of main accounting policies
□ Applicable √Not applicable
（2）Change of main accounting estimations
□ Applicable √Not applicable
34.Other
VI.Taxes of the Company
1. Main taxes categories and tax rate
Taxes Tax references Applicable tax rates
The tax rate has changed from 17% to 16%
VAT The taxable turnover
since May.
City construction tax Turnover tax to be paid allowances 7%
Business income tax Turnover tax to be paid allowances 25%、15%
Education surcharge Turnover tax to be paid allowances 3%
Local education surcharge Turnover tax to be paid allowances 2%
In case there exist any taxpayer paying corporate income tax at different tax rates, disclose the
information
Name of taxpayer Income tax rates
Shenzhen Shengbo Optoelectronic Technology Co., Ltd. 15%
2. Tax preference and approval file
(1)Shenzhen Shengbo Optoelectronic Technology Co., Ltd., the subsidiary company of our
company, has been qualified as national high-tech enterprise since 2016 ,High-tech and enterprise
certificate No.: GR201644201276 ,The certificate is valid for three years, The enterprise income
tax rate of this year is 15%.
(2).In accordance with relevant provisions of the Notice of Ministry of Finance, General Administ
ration of Customs and State Taxation Administration Regarding Tax Preference Policies for Furthe
r Supporting the Development of New-type Display Device Industry (Cai Guan Shui (2016) No. 6
2), Shenzhen Shengbo Optoelectronic Technology Co., Ltd. manufactured key materials and parts
for the upstream industry of new-type display devices including colorful light filter coating and po
larizer sheet that comply with the planning for independent development of domestic industries m
ay enjoy the preferential policies of exemption from import tariff for the import of raw materials a
nd consumables for the purpose of self use and production that can not be produced domestically f
rom January 1, 2016 and December 31, 2020.
3.Other
VII. Notes of consolidated financial statement
1.Monetary Capital
In RMB
Items Year-end balance Year-beginning balance
Cash at hand 1,720.24 17,771.09
Bank deposit 1,016,522,661.15 1,163,010,967.65
Other monetary funds 2,019,381.97 2,019,370.09
Total 1,018,543,763.36 1,165,048,108.83
Including : The total amount of deposit
8,926,677.22 9,044,548.79
abroad
Other notes
As of June 30, 2018，The fixed-term deposit balance of money fund is RMB 3,807,969.50 , this
part will not be treated as closing cash or closing cash equivalent in preparing cash flow statement.
Monetary unit is RMB yuan
2.Financial assets measured at fair value throuth current profit and loss
□ Applicable √ Not applicable
3.Derivative financial assets
□Applicable √ Not applicable
4.Note receivables
(1) Classification note receivable
In RMB
Items Year-end balance Year-beginning balance
Bank acceptance 1,668,992.95 44,207,119.00
Total 1,668,992.95 44,207,119.00
（2）Note receivable endorsed or discounted by the Company as at June 30.2018 but not expired
on the balance sheet date
In RMB
Items Amount derecognizing at period –end Amount derecognizing at period-end
Bank acceptance 29,995,613.18
Total 29,995,613.18
（4）There is no notes transferred to accounts receivable because drawer of the notes fails to
exuted the contract or agreement
□ Applicable √ Not applicable
5. Account receivable
(1)Classification account receivables.
In RMB
Amount in year-end Amount in year-begin
Book balance Bad debt provision Book balance Bad debt provision
Category Book
Proportio Proportio Proportio Proportion( Book value
Amount Amount value Amount Amount
n(%) n(%) n(%) %)
Accounts receivable
of individual
significance and 6,301,05 3,998,80 2,302,254 6,301,0 3,998,803 2,302,254.0
2.58% 63.46% 2.97% 63.46%
subject to individual 7.07 3.02 .05 57.07 .02 5
impairment
assessment
Accounts receivable
subject to impairment
232,443, 11,826,9 220,916,5 199,198 10,386,73 188,812,12
assessment by credit 95.07% 5.09% 93.99% 5.21%
460.36 00.32 60.04 ,855.51 4.84 0.67
risk characteristics of
a portfolio
Accounts receivable
of individual
insignificance but 5,748,80 4,060,10 1,388,702 6,448,8 5,060,100 1,388,702.9
2.35% 70.63% 3.04% 78.47%
subject to individual 3.57 0.59 .98 03.57 .59 8
impairment
assessment
244,493, 19,885,8 224,607,5 211,948 19,445,63 192,503,07
Total 100.00% 100.00% 100.00% 100.00%
321.00 03.93 17.07 ,716.15 8.45 7.70
Accounts receivable of individual significance and subject to individual impairment assessment.
√ Applicable □Not applicable
In RMB
Account Amount in year-end
receivable(Unit） Account receivable Bad debt provision Proportion(%) Reason for allowance
Dongguan Fair LCD Co., It has been included in
1,696,548.96 1,696,548.96 100.00%
Ltd. the list of national courts
dishonest debtor, unlikely
to recover.
Beyond the credit period
Guangdong Ruili Baolai
1,348,965.36 674,482.68 50.00% for a long time, uncertain
Technology Co., Ltd.
recovered.
Beyond the credit period
Dongguan Yaxing
3,255,542.75 1,627,771.38 50.00% for a long time, uncertain
Semiconductor Co., Ltd.
recovered.
Total 6,301,057.07 3,998,803.02 -- --
Account reveivable on which bad debt proisions are provided on age basis in the group
√ Applicable □Not applicable
In RMB
Balance in year-end
Aging
Account receivable Bad debt provision Proportion(%)
Subitem Within 1 year
231,907,311.27 11,595,365.56 5.00%
Subtotal within 1 year 231,907,311.27 11,595,365.56 5.00%
1-2 years 53,684.00 5,368.40 10.00%
2-3 years 75,330.97 22,599.29 30.00%
Over 3 years 45,898.44 22,949.22 50.00%
3-4 years 128,940.73 64,470.37 50.00%
4-5 years 232,294.95 116,147.48 50.00%
Total 232,443,460.36 11,826,900.32
Notes of the basis of recognizing the group:
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt
provision：
□ Applicable √ Not applicable
Receivable accounts on which had debt provisions are provided by other ways in the portfolio
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB440,165.48 ; recovery or payback for bad
debts Amount is RMB0.00.
（3）The ending balance of account receivables owed by the imputation of the top five parties
Balance in Proportion(%) Bad debt provision
Name Nature Aging
year-end
First Goods Within 1 year 29.99% 3,666,634.02
73,332,680.33
Second Goods Within 1 year 18.29% 2,235,900.00
44,718,000.00
Third Goods Within 1 year 13.49% 1,649,250.00
32,985,000.00
Fourth Goods Within 1 year 4.23% 517,245.43
10,344,908.57
Fifth Goods Within 1 year 3.29% 402,366.34
8,047,326.72
Total 69.30% 8,471,395.78
169,427,915.62
6.Prepayments
（1）Age analysis
In RMB
Balance in year-end Balance in year-begin
Aging
Amount Proportion（%） Amount Proportion（%）
Within 1 year 195,791,204.91 99.97% 13,705,047.27 99.63%
1-2 years 21,988.56 0.01% 11,944.78 0.09%
2-3 years 38,160.00 0.02% 38,160.00 0.28%
Over 3 years 195,851,353.47 -- 13,755,152.05 --
Total
（2）The ending balance of Prepayments owed by the imputation of the top five parties
Name Balance in year-end Proportion
First 131,977,638.68 67.39%
Second 20,300,000.00 10.37%
Third 20,000,000.00 10.21%
Fourth 9,211,650.58 4.70%
Fifth 6,616,600.00 3.38%
Total 188,105,889.26 96.05%
7.Interest receivable
1.Category of interest receivable
In RMB
Items Amount in year-end Amount in year-beginng
Fixed deposit interest 15,203,853.00 12,676,572.40
Trust income 1,627,397.26
Structure deposit interest 3,629,626.86 1,418,738.58
Other financing product 6,164.38
TotaL 18,833,479.86 15,728,872.62
（2）Important overdue interest
□Applicable √Not applicable
8.Dividend receivable
（1）Dividend receivable
In RMB
Items Balance in year-end Balance in year-begin
（2）Significant dividend receivable aged over 1 year
9.Other receivable
1．Category of Other receivable
In RMB
Amount in year-end Amount in year- begin
Book Balance Bad debt provision Book Balance Bad debt provision
Category Book
Proportio Proportio Proportio Proportion( Book value
Amount Amount value Amount Amount
n(%) n(%) n(%) %)
Other accounts
receivable of
13,781
individual 13,781, 13,781, 13,781,4
48.66% 100.00% 0.00 ,464.6 47.54% 100.00% 0.00
significance and 464.60 464.60 64.60
0
subject to individual
impairment
assessment
Other accounts
receivable subject to
14,596
impairment 13,927, 1,509,1 12,418,2 1,670,39 12,925,98
49.18% 10.84% ,383.5 50.35% 11.44%
assessment by credit 423.06 43.36 79.70 9.08 4.45
3
risk characteristics of
a portfolio
Other accounts
receivable of
individual
611,820 611,820 611,82 611,820.
insignificance but 2.16% 100.00% 0.00 2.11% 100.00% 0.00
.77 .77 0.77 77
subject to individual
impairment
assessment
28,989
28,320, 15,902, 12,418,2 16,063,6 12,925,98
Total 100.00% ,668.9 100.00%
708.43 428.73 79.70 84.45 4.45
0
Other receivable accounts with large amount and were provided had debt provisions individually
at end of period.
√ Applicable □Not applicable
In RMB
Amount in year-end
Other receivable（Unit） Withdrawal proportion
Other account receivable Bad debt provision Reason for allowance
(%)
Jiangxi Xuanli String No executable property,
11,389,044.60 11,389,044.60 100.00%
Co., Ltd. unlikely to recover.
1,800,000.00 1,800,000.00 100.00% Estimated irrecoverable
Shenzhen Tianlong
Has been conceled,
Induatry& Trade Co., 592,420.00 592,420.00 100.00%
unlikely to recover
Ltd.
Total 13,781,464.60 13,781,464.60 -- --
Other receivable accounts in Group on which bad debt provisions were provided on age analyze
basis：
√Applicable □Not applicable
In RMB
Amount in year-end
Aging
Other receivable Bad debt provision Withdrawal proportion
Subitem within 1 year
Subtotal Within 1 year 9,084,634.17 454,231.71 5.00%
1-2 years 3,032,560.75 303,256.08 10.00%
2—3 years 767,292.47 230,187.74 30.00%
Over 3 years 1,042,935.67 521,467.84 50.00%
3-4 years 710,122.83 355,061.42 50.00%
4-5 years 160,403.68 80,201.84 50.00%
Over 5 years 172,409.16 86,204.58 50.00%
Total 13,927,423.06 1,509,143.36
Other receivable account in Group on which bad debt provisions were provided on percentage
basis：
□Applicable √Not applicable
Other Receivable accounts on which bad debt provisions are provided by other ways in the
portfolio：
□Applicable √Not applicable
（2）Bad debt provision accrual collected or switch back
Bad debt provision accrual was RMB-161,255.72, the acount collected or switches back
amounting to RMB0.00.
(3) Other account receivables category by nature of money
In RMB
Category Year-end balance Year-beginning balance
Customs bond 265,625.07 1,454,781.62
Export rebate 2,475,289.80 7,804,119.33
Unit account 14,914,848.23 15,211,367.96
Deposit 643,518.35 1,752,199.92
Reserve fund and staff loans 947,827.17 849,212.52
Other 9,073,599.81 1,917,987.55
Total 28,320,708.43 28,989,668.90
(4)Top 5 of the closing balance of the other accounts receivable colleted according to the arrears
party
In RMB
Portion in total other Bad debt provision
Name Nature Year-end balance Age
receivables(%) of year-end balance
First Unit account 11,389,044.60 Over 5 years 40.21% 11,389,044.60
Second Unit account 1,800,000.00 1-2 years 6.36% 1,800,000.00
Third Export rebate 1,515,881.87 Within 1 year 5.35% 75,794.09
Fourth Deposit 629,278.35 Within 1 year 2.22% 31,463.92
Fifth Unit account 592,420.00 Over 5 years 2.09% 592,420.00
Total -- 15,926,624.82 -- 13,888,722.61
10.Inventory
（1）Inventories types
In RMB
Year-end balance Year-beginning balance
Items
Book balance Provision for bad Book value Book balance Provision for bad Book value
debts debts
Raw materials 87,061,113.61 12,679,234.15 74,381,879.46 134,843,713.96 12,679,234.15 122,164,479.81
Processing
49,571,566.76 49,571,566.76 3,234,902.35 3,234,902.35
products
Stock goods 240,737,319.36 35,398,716.90 205,338,602.46 189,554,586.67 39,338,792.67 150,215,794.00
Total 377,369,999.73 48,077,951.05 329,292,048.68 327,633,202.98 52,018,026.82 275,615,176.16
Whether the company is required to comply with the "Shenzhen Stock Exchange Industry
Information Disclosure Guidelines No. 4 - listed companies engaged in seed industry, planting
business" disclosure requirements
No
（2）Inventory Impairment provision
In RMB
Year-beginning Increased in current period Decreased in current period
Items Year-end balance
balance Provision Transferred back Provision Other
Raw materials 12,679,234.15 12,679,234.15
Stock goods 39,338,792.67 17,115,422.28 21,055,498.05 35,398,716.90
Total 52,018,026.82 17,115,422.28 21,055,498.05 48,077,951.05
11. Holding assets for sale
12. Non current assets due within one year
13.Other current assets
In RMB
Items Year-end balance Year-beginning balance
Structural Deposit 180,000,000.00 210,000,000.00
Trust financing 800,000,000.00 800,000,000.00
Other financing product 0.00 10,000,000.00
After the deduction of input VAT 140,702,098.15 128,689,874.10
Total 1,120,702,098.15 1,148,689,874.10
14.Available-for-sale financial assets
(1)Available-for-sale financial assets
In RMB
Year-end balance Year-beginning balance
Items
Bad debt Bad debt
Book balance Book value Book balance Book value
provision provision
Available-for-sale equity
109,934,880.27 44,579,303.00 65,355,577.27 110,615,036.04 44,579,303.00 66,035,733.04
instruments
Measured by fair value 7,314,138.86 7,314,138.86 7,994,294.63 7,994,294.63
Measured by cost 102,620,741.41 44,579,303.00 58,041,438.41 102,620,741.41 44,579,303.00 58,041,438.41
Total 109,934,880.27 44,579,303.00 65,355,577.27 110,615,036.04 44,579,303.00 66,035,733.04
(2)Available-for-sale financial assets measured by fair value at the period-end
In RMB
Available-for-sale equity Available-for-sale Debt
Type Total
instruments instruments
Cost of the equity
instruments/amortized
8,940,598.31 8,940,598.31
cost of the liabilities
instruments
Fair value 7,314,138.86 7,314,138.86
Changed amount of the -1,626,459.45 -1,626,459.45
fair value accumulatively
included in other
comprehensive income
(3) Available-for-sale financial assets measured by cost at the period-end
In RMB
Book balance Impairment provision Shareholdi Cash
ng bonus of
Investee Period-beg Period-beg Increas Decreas proportion the
Period
in Increase Decrease in Period -end among the reporting
-end e e
investees period
Shenzhen
Jintian
14,831,681 14,831,681 14,831,681
Industry 14,831,681.50 2.39%
.50 .50 .50
（Group）
Co., Ltd.
Shenzhen
Jiafeng 16,800,000 16,800,000 16,800,000
16,800,000.00 10.80%
Textile .00 .00 .00
Co., ltd.
Shenzhen
Guanhua
5,491,288. 5,491,288. 5,058,307.
Prnting & 5,058,307.01 45.00%
71 71 01
dyeing
Co., Ltd.
Shenzhen
Union
2,600,000. 2,600,000.
Developm 2.87%
00 00
ent Group
Co., Ltd
Shenzhen
Xiangjiang
160,000.00 160,000.00 20.00%
Trade Co.,
Ltd.
Shenzhen
Xinfang
524,000.00 524,000.00 20.00%
Knitting
Co., Ltd.
Shenzhen 2,559,856. 2,559,856. 30.00%
Dailisi 26 26
Knitting
Co., Ltd.
Anhui
Huapeng 25,410,209 25,410,209 7,622,659.
7,622,659.50 50.00%
Textile .50 .50 50
Co., Ltd.
Shenzhen
South 1,500,000. 1,500,000.
9.84%
Textile 00 00
Co., Ltd.
Shenzhen
South 4,243,705. 4,243,705.
266,654.99 266,654.99 50.00%
Textile 44 44
Co., Ltd.
Changxing
Junying
28,500,000 28,500,000
Investment 57.00%
.00 .00
Partnershi
p
102,620,74 102,620,74 44,579,303
Total 44,579,303.00 --
1.41 1.41 .00
(4)Changes of the impairment of the available-for-sale financial assets during the reporting period
In RMB
Available for sale equity Available for sale debts
Category Total
instruments instruments
Impairment amount at
44,579,303.00 44,579,303.00
the beginning period
Impairment amount at
44,579,303.00 44,579,303.00
the end of period
15. Held-to-maturity investment
16. Long-term account receivables
17. Long-term equity investment
In RMB
Opening Increase/decrease Closing Closing
Investees
balance Addition Deductio Gains/los Other Other Declarati Withdraw Other balance balance
investmen n s under comprehe changes on of cash n of
t investmen equity nsive in equity dividends impairme impairme
t method income or profit nt nt
adjustmen provision provision
ts
I. Joint ventures
Shenzhen
Haohao
5,369,450 393,860.7 400,000.0 5,363,311
Property
.56 7 0 .33
Leasing
Co., Ltd.
5,369,450 393,860.7 400,000.0 5,363,311
Subtotal
.56 7 0 .33
2. Affiliated Company
Shenzhen
Changlian
fa 2,107,155 2,203,243
96,088.63
Printing .01 .64
& dyeing
Company
Jordan
2,233,902 -68,777.0 2,192,865
Garment 27,739.85
.64 0 .49
Factory
Hongkon
g Yehui
10,670,22 195,773.2 198,456.0 10,760,15
Internatio 92,609.30
6.35 7 0 2.92
nal Co.,
Ltd.
15,011,28 223,084.9 120,349.1 198,456.0 15,156,26
Subtotal
4.00 0 5 0 2.05
20,380,73 616,945.6 120,349.1 598,456.0 20,519,57
Total
4.56 7 5 0 3.38
18.Investment real estate
（1）Measured by the cost of investment in real estate
√ Applicable □ Not applicable
In RMB
Items House, Building Land use right Construction in process Total
I. Original price
1. Balance at
306,466,721.91 306,466,721.91
period-beginning
2.Increase in the
2,499,538.83 2,499,538.83
current period
(1) Purchase
（2）Inventory\Fixed
assets\ Transferred from
construction in progress
(3)Increased of
Enterprise Combination
3.Decreased amount of
the period
（1）Dispose
（2）Other out
4. Balance at period-end 308,966,260.74 308,966,260.74
II.Accumulated
amortization
1.Opening balance 133,360,915.64 133,360,915.64
2.Increased amount ofthe
3,890,452.29 3,890,452.29
period
(1) Withdrawal 3,890,452.29 3,890,452.29
3.Decreased amount of
the period
（1）Dispose
（2）Other out
4. Balance at
137,251,367.93 137,251,367.93
period-end
III. Impairment provision
1. Balance at
period-beginning
2.Increased amount of
the period
(1) Withdrawal 0.00
3.Decreased amount of
the period
（1）Dispose
（2）Other out
4. Balance at period-end
IV.Book value
1.Book value at period
171,714,892.81 171,714,892.81
-end
2.Book value at
173,105,806.27 173,105,806.27
period-beginning
(2) Details of fixed assets failed to accomplish certification of property
□ Applicable √ Not appliucable
(3) Investment real estate without certificate of ownership
Items Values Reansons
Settlement audit has not yet been
The Guanhua Building 49,231,570.92
completed.
19. Fixed assets
(1) List of fixed assets
In RMB
Machinery
Items Houses & buildings Transportations Other Total
eqiupment
I. Original price
1.Opening balance 492,709,415.27 659,301,895.53 3,691,157.72 22,260,594.58 1,177,963,063.10
2.Increased amount
53,519,097.66 335,851,249.20 6,163,861.61 5,691,897.65 401,226,106.12
ofthe period
(1) Purchase 32,418,176.86 6,163,861.61 5,691,897.65 44,273,936.12
(2) Transferred fro
53,519,097.66 303,433,072.34 356,952,170.00
m construction in pr
ogress
(3)Increased of
Enterprise
Combination
3.Decreased amount
30,538.18 61,069.08 91,607.26
of the period
（1）Disposal 30,538.18 61,069.08 91,607.26
4. Balance at
546,228,512.93 995,122,606.55 9,855,019.33 27,891,423.15 1,579,097,561.96
period-end
II. Accumulated
depreciation
1.Opening balance 113,563,999.41 389,901,922.93 3,268,450.66 15,095,489.91 521,829,862.91
2.Increased amount
7,007,923.62 28,096,254.46 102,362.04 806,264.61 36,012,804.73
of the period
(1) Withdrawal 7,007,923.62 28,096,254.46 102,362.04 806,264.61 36,012,804.73
3.Decrease in the
16,879.34 29,389.84 46,269.18
reporting period
（1）Disposal 16,879.34 29,389.84 46,269.18
4.Closing balance 120,571,923.03 417,981,298.05 3,370,812.70 15,872,364.68 557,796,398.46
III. Impairment
provision
1.Opening balance
2.Increase in the
reporting period
（1）Withdrawal
3.Decrease in
the reporting period
（1）Disposal
4. Closing balance
IV. Book value
1.Book value of the
425,656,589.90 577,141,308.50 6,484,206.63 12,019,058.47 1,021,301,163.50
period-end
2.Book value of the
379,145,415.86 269,399,972.60 422,707.06 7,165,104.67 656,133,200.19
period-begin
20. Project under construction
(1)Project under construction
In RMB
Year-end balance Year-beginning balance
Items Book balance Provision for Book value Book balance Provision for Book value
devaluation devaluation
TFT-LCD
polarizing film II 0.00 0.00 315,430,810.41 315,430,810.41
project
2500mm width
1,280,703.35 1,280,703.35 500,168.25 500,168.25
production line
Engineering
10,673,306.16 10,673,306.16 4,629,218.20 4,629,218.20
transformation
Other 2,748,768.71 2,748,768.71 2,009,976.87 2,009,976.87
Total 14,702,778.22 14,702,778.22 322,570,173.73 322,570,173.73
（2）Changes of significant construction in progress
In RMB
Includin
Capitalis g：
Amount Transferr ation of Current Capitalis
Increase Balance
at year ed to Other Proporti Progress interest amount ation of Source
Name Budget at this in
beginnin fixed decrease on(%) of work accumul of interest of funds
period year-end
g assets ated capitaliz ratio（%)
balance ation of
interest
TFT-LC
D
700,340, 315,430, 39,520,2 354,951,
polarizin 0.00 0.00 50.68% Other
000.00 810.41 02.14 012.55
g film II
project
Total 700,340, 315,430, 39,520,2 354,951, -- -- --
000.00 810.41 02.14 012.55
21. Engineering Material
22.Liquidation of fixed assets
23. Productive biological assets
24. Oil-and-gas assets
25. Intangible assets
（1）Information
In RMB
Non-proprietary Proprietary
Items Land use right Patent right Software Total
technology technology
I. Original price
1. Balance at
48,822,064.61 11,825,200.00 2,591,780.00 63,239,044.61
period-beginning
2.Increase in the
current period
(1) Purchase
（2）Internal R &
D
（3）Increased of
Enterprise
Combination
3.Decreased
amount of the 28,022.72 28,022.72
period
（1）Disposal 28,022.72 28,022.72
4. Balance at
48,822,064.61 11,825,200.00 2,563,757.28 63,211,021.89
period-end
II.Accumulated
amortization
1. Balance at
11,283,873.79 11,825,200.00 1,259,297.42 24,368,371.21
period-beginning
2. Increase in the 508,071.86 112,090.88 620,162.74
current period
(1) Withdrawal 508,071.86 112,090.88 620,162.74
3.Decreased
amount of the
period
（1）Disposal
4. Balance at
11,791,945.65 11,825,200.00 1,371,388.30 24,988,533.95
period-end
III. Impairment
provision
1. Balance at
period-beginning
2. Increase in the
current period
(1) Withdrawal
3.Decreased
amount of the
period
（1）Disposal
4. Balance at
period-end
4. Book value
1.Book value at
37,030,118.96 1,192,368.98 38,222,487.94
period -end
2.Book value at
37,538,190.82 1,332,482.58 38,870,673.40
period-beginning
26. Research and development expenditure
27.Goodwill
(1) Original book value of goodwill
In RMB
Name of the
Opening balance Increase Decrease Closing balance
investees or the
events formed
goodwill
Shenzhen Beauty
Century Garment 2,167,341.21 2,167,341.21
Co., Ltd.
Shenzhen
Shenfang Import
82,246.61 82,246.61
and Export Co.,
Ltd.
Shenzhen Shengbo
Optoelectronic
9,614,758.55 9,614,758.55
Technology Co.,
Ltd
Total 11,864,346.37 11,864,346.37
（2）Impairment of goodwill
In RMB
Balance in Balance in
Investee Increased at this period .Decreased at this period
year-begin year-end
Shenzhen Beauty
Century Garment 2,167,341.21 2,167,341.21
Co., Ltd.
Shenzhen
Shenfang Import
82,246.61 82,246.61
and Export Co.,
Ltd.
Shenzhen Shengbo 9,614,758.55 9,614,758.55
Optoelectronic
Technology Co.,
Ltd
Total 11,864,346.37 11,864,346.37
28. Long term amortize expenses
In RMB
Balance in Increase in this Amortized expenses
Items Other loss Balance in year-end
year-begin period
Renovation fee 841,713.23 294,770.06 73,649.05 0.00 1,062,834.24
Other 193,576.85 7,800.00 81,487.77 0.00 119,889.08
Total 1,035,290.08 302,570.06 155,136.82 0.00 1,182,723.32
29. Deferred income tax assets/deferred income tax liabilities
（1）Details of the un-recognized deferred income tax assets
In RMB
Balance in year-end Balance in year-begin
Items
Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Assets depreciation
5,263,784.32 1,315,946.08 5,190,838.04 1,297,709.51
reserves
Unattained internal sales
2,636,093.43 395,414.03 2,680,650.70 402,097.62
profits
Changes in fair value of
available for sale 1,626,459.45 406,614.86 946,303.68 236,575.93
financial assets
Temporary differences in
the formation of equity 2,029,115.04 507,278.76 152,615.37 38,153.84
incentives
Other
Total 11,555,452.24 2,625,253.73 8,970,407.79 1,974,536.90
(2) Deferred income tax assets or liabilities listed by net amount after off-set
In RMB
Trade-off between the Opening balance of
Trade-off between the End balance of deferred
deferred income tax deferred income tax
Items deferred income tax income tax assets or
assets and liabilities at assets or liabilities after
assets and liabilities liabilities after off-set
period-begin off-set
Deferred income tax
2,625,253.73 1,974,536.90
assets
(3)Details of income tax assets not recognized
In RMB
Items Balance in year-end Balance in year-begin
Deductible temporary difference 84,544,641.61 80,615,487.41
Deductible loss 356,787,195.90 486,014,140.23
Total 441,331,837.51 566,629,627.64
(4)Deductible losses of the un-recognized deferred income tax asset will expire in the following
years
In RMB
Year Balance in year-end Balance in year-begin Remark
2018 129,226,944.33
2019 148,095,898.11 148,095,898.11
2020 83,990,395.00 83,990,395.00
2021 124,700,902.79 124,700,902.79
Total 356,787,195.90 486,014,140.23 --
30 .Other non-current assets
In RMB
Items Balance in year-end Balance in year-begin
Advance payment for equipment fund 2,772,114.56
Dvance payment for technical services 42,346,134.84 44,394,879.92
Total 42,346,134.84 47,166,994.48
31. Short-term loan
（1）Categories of short-term loans
In RMB
Items Balance in year-end Balance in year-Beginning
Credit loans 197,389,295.07 88,638,181.45
Total 197,389,295.07 88,638,181.45
32. Financial liabilities measured at fair value through current profit and loss
33. Derivative financial liabilities
□ Applicable√ Not applicable
34. Note payable
In RMB
Items Balance in year-end Balance in year-begin
Bank acceptance bills 19,500,000.00
Total 19,500,000.00
35. Account payable
（1）Account payable
In RMB
Items Balance in year-end Balance in year-begin
Within 1 year 61,389,841.01 96,043,721.23
1-2 years 27,566.50 37,402.40
2-3 years 27,402.40 37,083.00
3-4 years 17,083.00 300,642.80
4-5 years 300,642.80 37,090.00
Over 5 years 445,253.53 648,757.75
Total 62,207,789.24 97,104,697.18
（2）Significant accounts payable that aged over one year
In RMB
The reason for not repaid or carried forwar
Tems Balance in year-end
d
36.Advance account
（1）Advance account
In RMB
Items Balance in year-end Balance in year-begin
Within 1 year 37,597,370.18 33,708,344.84
1-2 years 240,275.96
2-3 years 364,922.45
3-4 years
Over 5 years 639,024.58 639,024.58
Total 38,236,394.76 34,952,567.83
37.Payable Employee wage
（1）Payable Employee wage
In RMB
Items Balance in year-begin Increase in this period Payable in this period Balance in year-end
I. Short –term wages 29,503,260.65 67,445,438.28 78,606,725.73 18,341,973.20
II. Welfare afterlwaving
of position-fixed 5,643,995.77 5,643,995.77
provision scheme
Total 29,503,260.65 73,089,434.05 84,250,721.50 18,341,973.20
（2）Short-term remuneration
In RMB
Items Balance in year-begin Increase in this period Payable in this period Balance in year-end
1.Wages, bonuses,
27,846,341.48 58,837,127.93 70,012,519.68 16,670,949.73
allowances and subsidies
2.Employee welfare 3,835,600.53 3,835,600.53
3. Social insurance
1,062,233.15 1,062,233.15
premiums
Including：Medical
834,782.99 834,782.99
insurance
Work injury insurance 114,298.25 114,298.25
Maternity insurance 113,151.91 113,151.91
4. Public reserves for
2,489,156.08 2,489,156.08
housing
5.Union funds and staff
1,656,919.17 1,221,320.59 1,207,216.29 1,671,023.47
education fee
Total 29,503,260.65 67,445,438.28 78,606,725.73 18,341,973.20
（3）Defined contribution plans listed
In RMB
Items Balance in year-begin Increase in this period Payable in this period Balance in year-end
1. Basic old-age
4,686,509.82 4,686,509.82
insurance premiums
2.Unemployment
135,191.10 135,191.10
insurance
3. Annuity payment 822,294.85 822,294.85
Total 5,643,995.77 5,643,995.77
38.Tax Payable
In RMB
Items At end of term At beginning of term
VAT 447,369.40 548,014.78
Expenditure taxes 0.00
Enterprise Income tax 3,849,800.68 3,912,084.91
Individual Income tax 1,059,630.01 704,212.04
City Construction tax 36,389.98 34,389.37
House property tax 2,948,571.06 1,541,424.38
Educational surtax 24,878.61 22,055.75
Other 305,233.36 173,081.34
Total 8,671,873.10 6,935,262.57
39. Interest payable
In RMB
Items At end of term At beginning of term
Interest on long-term borrowings payable 46,643,162.06 44,446,217.66
Interest on short-term borrowings 447,233.47 195,135.86
Total 47,090,395.53 45,799,544.04
40. Dividends payable
41.Other payable
（1）Disclosure by nature
In RMB
Items At end of term At beginning of term
Engineering Equipment fund 77,786,803.19 34,977,749.54
Unit account 48,697,613.74 48,697,613.74
Deposit 25,018,600.58 25,090,664.49
Restrictive stock repurchase obligation 27,230,679.00 27,230,679.00
Other 23,901,272.84 19,030,092.77
Total 202,634,969.35 155,026,799.54
42. Divided into liability held for sale
43.Non-current liabilitiesdue within 1 year
In RMB
Items At end of term At beginning of term
Long-term loans due within 1 year 40,000,000.00
Total 40,000,000.00
44.Other current liabilities
45.Long-term borrowings
（1）Long-term term borrowings
In RMB
Items At end of term At beginning of term
Credit borrowings 40,000,000.00 40,000,000.00
Total 40,000,000.00 40,000,000.00
46.Bond payable
47. Long-term payable
48. Long-term employee salary payable
49. Specific payable
50. Estimates liabilities
51.Deferred income
In RMB
Items Beginning of term Increased this term Decreased this term End of term Reason
Govemment Subsidy 134,767,064.72 5,396,000.00 5,812,167.76 134,350,896.96
Total 134,767,064.72 5,396,000.00 5,812,167.76 134,350,896.96 --
Details of government subsidies：
In RMB
New Amount Other income Amount of
Asset-related
Beginning of subsidy transferred to recorded in cost deducted Other
Items End of term orincome-rel
term in current non-operatio the current in the current changes
ated
period nal income period period
Textile Related to
714,285.73 71,428.58 642,857.15
special funds assets
High-tech
Industrializati
Related to
on 400,000.00 100,000.00 300,000.00
assets
demonstratio
n projects
National
grant
fundsfor new Related to
2,000,000.00 500,000.00 1,500,000.00
flat panel assets
display
industry
Grant funds
for TFT-LCD
Related to
polarizer 5,633,333.34 649,999.97 4,983,333.37
assets
industry
project
Grant funds Related to
2,500,000.00 250,000.02 2,249,999.98
for TFT-LCD assets
polarizer
narrow line
(line 5)
project
Purchase of
imported
Related to
equipment 852,106.98 87,545.09 764,561.89
assets
and
technology
Innovation
and venture
capital for Related to
250,000.00 25,000.04 224,999.96
TFT-LCD assets
polarier I
project
Shenzhen
polarizing
materials and
Technology
Related to
Engineering 362,500.00 25,000.02 337,499.98
assets
Laboratory
innovation
venture
capital
Shenzzhen
Engineering
laboratory
Related to
polarizing 3,625,000.00 250,000.02 3,374,999.98
assets
material and
technical
engineeting
Capital
funding for Related to
2,175,000.00 150,000.00 2,025,000.00
Technology assets
Center
Subsidy fund
s to support t
Related to
he introductio 71,940.51 7,194.00 64,746.51
assets
n of advance
d technology
Grant funds
for TFT-LCD 15,000,000.0 Related to
15,000,000.00
polarizer 0 assets
narrow line
(line 6)
project
Grant funds
for TFT-LCD
polarizer 10,000,000.0 Related to
10,000,000.00
narrow line 0 assets
(line 6)
project
Grant funds
for TFT-LCD
polarizer Related to
500,000.00 500,000.00
narrow line assets
(line 6)
project
key technolo
gy
research and
development
Related to
projects of 4,625,000.00 250,000.02 4,374,999.98
assets
optical
compensation
film for
polarizer
Strategic
industries
Development 25,000,000.0 Related to
25,000,000.00
fund of 0 assets
Guangdong
Province
Grants of
Purchase
equipment of
30,000,000.0 Related to
TFT-LCD 30,000,000.00
0 assets
polarizing
film phase II
project
Energy
saving Related to
116,101.49 116,101.49
transformatio assets
n grant funds
Polarization
Industrializati 30,000,000.0 Related to
30,000,000.00
on Project for 0 assets
Super
Large-sized
TVs (Line 7)
Central
Budget
Investment
Old Elevator
Related to
Renovation 941,796.67 50,000.00 891,796.67
assets
Fund Subsidy
Shenzhen
standard
960,000.0 Related to
special 960,000.00
0 income
fund
subsidy
Research on
Key
Technology
of
Polarizer 2,000,000 Related to
0.00 2,000,000.00
for .00 assets
Ultra-thin
IPS
Smartphone
Terminal
Government
subsidies 2,436,000 Related to
2,436,000.00
related to .00 income
income
5,396,000 134,350,896.
Total 134,767,064.72 5,812,167.76 --
.00 96
(1).According to the "Notice on National Development and Reform Commission to the
General Office of the textile project management of the special funds" (Faigaiban [2006]2841), on
December 22, 2006, the Company received "Textile special" funds RMB 2,000,000.00 from
Shenzhen Finance Bureau. The company will use 14 years as asset depreciation period for
amortization with the corresponding equipment in current period. The amortization in accordance
with the corresponding equipment, The other income in current period is RMB71,428.58, the
ending balance of uncompleted amortization is RMB642,857.15 .
(2).According to the document of Shenzhen Municipal Development and Reform
Commission 【2009】 No. 416 that "The Notice On issued the Governmental Investment Plan in
2009 on Zhong Ke New Industrial Internet Security Audit System and Other High-tech
Industrialization Demonstration Project and the Public Testing and Consultation Service of
Information Security Industry and other National High-tech Industrial Base Platform Projects”, on
May 2009, the company received the Shenzhen Municipal Development and Reform Commission
high-tech industrialization demonstration project supporting Capital RMB 2 million allocated by
Shenzhen City Bureau of Finance for the construction of “The Project of the Construction Line of
Polaripiece for TFT-LCD”.Our company will use 10 years as asset depreciation period for
amortization in current period. The other income in current period is RMB100,000.00 and the
balance amount of unfinished final amortization is RMB300,000.00.
(3) According to the document of the Office of the State Development and Reform Commission
on "The Office of the State Development and Reform Commission on the Reply of New
Flat-Panel Display Industrialization Special Project” (Development and Reform Office High-Tech
【2008】No. 2104), the company obtained the state subsidies RMB 10,000,000.00 from the State
Development and Reform Commission New Flat-Panel Display Industrialization Special Project
for the construction of “The Project of Polaripiece Industrialization for TFT-LCD”. On June 2009,
December 2009 and April 2010, the company received the special subsidies of State Development
and Reform Commission RMB 10,000,000.00. Our company will use 10 years as asset
depreciation period for amortization. The non-operating income in current period is
RMB500,000.00, the balance amount of unfinished final amortization is RMB1,500,000.00.
(4) In accordance with the Notice of Forwarding the Reply of General Office of State
Development and Reform Commission Regarding Special Plan for Strategic Transformation and
Industrialization of Color TV Industry issued by Shenzhen Development and Reform Commission
(Shen Fa Gai (2011) No. 823), State Development and Reform Commission approved including
the project of industrialization of polarizer sheet for TFT-LCD of Shengbo Optoelectronic
Company into the special plan for strategic transformation and industrialization of color TV
industry in 2010 and appropriated national aid of RMB 10,000,000.00 to Shengbo Optoelectronic
Company for the research and development in the process of the project of industrialization and
the purchase of required software and hardware equipment. On June 2012 and September 2013,
the company received the national grants of RMB 10,000,000.00.. According to the Notice of
Issuing the Governmental Investment Plan for 2011 Regarding Demonstration Project of
High-tech Industrialization Including Specialized Services Such As Disaster Recovery of
Financial Information System issued by Shenzhen Development and Reform Commission (Shen
Fa Gai (2012) No. 3), the Company received subsidy of RMB 3,000,000.00 for the project of
industrialization of polarizer sheet for TFT-LCD in April 2012. Our company will use 10 years as
asset depreciation period for amortization in current period.The non-operating income in current
period is RMB649,999.97. and the balance amount of unfinished final amortization is
RMB4,983,333.37.
(5) According to the Notice about the Plan for Supporting the Second Group of Enterprises in
Biological, Internet, New Energy and New Material Industries with Special Development Funds
(Shen Fa Gai (2011) No. 1782), the Company received subsidy of RMB 5,000,000.00 for the
narrow-width line (line 5) of phase-I project of polarizer sheet for TFT-LCD on February 2012.
The Company planned to amortize the subsidy over 10 years according to the depreciation period
of relevant assets. The non-operating income in current period is RMB250,000.02 and the balance
amount of unfinished final amortization is RMB2,249,999.98.
(6) On October 2013, The company received the grants for the purchase of imported equipment
and technology in 2012 of RMB 1,750,902.00, the Company planned to amortize the subsidy over
10 years according to the depreciation period of relevant assets.The non-operating income in
current period is RMB87,545.09 and the balance amount of unfinished final amortization is
RMB764,561.89.
(7) On December 2013，The company received the funds for innovation and entrepreneurship of
TFT-LCD polarizing project from Pingshan New District Development and Finance Bureau of
RMB 500,000.00(matching funding category),the Company planned to amortize the subsidy over
10 years according to the depreciation period of relevant assets. The non-operating income in
current period is RMB25,000.04 and the balance amount of unfinished final amortization is
RMB224,999.96元.
(8) On December 2013，The company received the funds for innovation and entrepreneurship of
TFT-LCD polarizing project from Pingshan New District Development and Finance Bureau of
RMB 500,000.00(matching funding category),the Company planned to amortize the subsidy over
10 years according to the depreciation period of relevant assets. The non-operating income in
current period is RMB25,000.02 and the balance amount of unfinished final amortization is
RMB337,499.98.
(10) According to the Approval of Application of Shenzhen Shengbo Optoelectronic Technology
Co., Ltd. for Project Funds for Shenzhen Polarization Material and Technology Engineering
Laboratory (Shen Fa Gai (2012) No. 1385), Shenzhen Polarization Material and Technology
Engineering Laboratory was approved to be established on the strength of Shengbo Optoelectronic
with total project investment of RMB 24,390,000.00. As approved by Shenzhen Municipal
People's Government, this project was included in the plan for supporting the fourth group of
enterprises with special fund for the development of strategic new industries in Shenzhen in 2012
(new material industry). According to the Notice of Issuing the Plan for Supporting the Fourth
Group of Enterprises with Special Fund for Development of Strategic New Industries in Shenzhen
in 2012 (Shen Fa Gai (2012) No. 1241), the Company received subsidy of RMB 5,000,000.00 on
December 2012 for purchasing instruments and equipment and improving existing technological
equipment and test conditions. The fund gap will be filled by the Company through raising funds by
itself. the Company planned to amortize the subsidy over 10 years according to the depreciation
period of relevant assets. The non-operating income in current period is RMB250,000.02 and the
balance amount of unfinished final amortization is RMB3,374,999.98.
(10) According to the “Announcement on the Identification of Technology Centers of 24
Enterprises including Shenzhen Yuanwanggu Information Technology Joint Stock Company
Limited as the Municipal Research and Development Centers (Technical Center)” (SJMXXJS
[2013] No.137), the research and development center of Shenzhen SAPO Photoelectric Co., Ltd.
has been regarded as 2012 annual municipal R&D center. In December 2013, the company has
received the funding subsidy of RMB3 million for the construction of the technical center. the
Company planned to amortize the subsidy over 10 years according to the depreciation period of
relevant assets. The non-operating income in current period is RMB150,000.00 and the balance
amount of unfinished final amortization is RMB2,025,000.00.
(11)On March 2014 the company received the introduction of advanced technology import subsid
y funds of RMB 143,881.00 from Shenzhen Finance Committee, the Company planned to
amortize the subsidy over 10 years according to the depreciation period of relevant assets. The
non-operating income in current period is RMB7,194.00 and the balance amount of unfinished
final amortization is RMB64,746.51.
(12) According to the "Shenzhen Municipal Development and Reform Commission Reply for
Shenzhen Shengbo Optoelectronic Technology Co., Ltd. application for local matching funds of
TFT-LCD polarizing film II project (Line 6) " (Shenzhen DRC [2013]No. 1771), the company
obtained TFT-LCD polarizing film II project (line 6) local matching funds of RMB 15,000,000.00
in April 2014.The fund gap will be filled by the Company through raising funds by itself. The
subsidy will be amortized over the depreciation period from the day when relevant assets get
ready for intended use.
(13) According to "National Development and Reform Commission issued on industrial
transformation and upgrading projects (2nd industrial restructuring) notify the central budget for
2014 investment plan" (NDRC Investment [2014] No. 1280), the company obtained TFT- LCD
polarizer II project (line 6) state grants of RMB 10,000,000.00 in December 2014.The fund gap
will be filled by the Company through raising funds by itself. The subsidy will be amortized over
the depreciation period from the day when relevant assets get ready for intended use.
(14) In December 2014, the company received innovation venture capital (matching funding
category) for Ping Shan District Development and Finance Bureau of TFT-LCD polarizing film II
project (line 6) of RMB 500,000.00.The fund gap will be filled by the Company through raising
funds by itself. The subsidy will be amortized over the depreciation period from the day when
relevant assets get ready for intended use;
(15)On Jan. 2015, the company received RMB 5 million of grants for key technology
research and development projects of optical compensation film for polarizer from
Shenzhen Scientific and Technological Innovation Committee. The company has reached the
expected date of use of the assets., the Company planned to amortize the subsidy over 10 years
according to the depreciation period of relevant assets. The other income in current period is
RMB250,000.02 and the balance amount of unfinished final amortization is RMB4,374,999.98.
(16). According to “Reply on Congregating Development in Emerging Industrial Area
Strategic Pilot Implement Scheme of Guangdong Province ”(Reform and Development Office
High-Tech [2013] No.2552,On December 2015, the Company received RMB20 million of the
pilot project fund( period II project of TFT-LCD polarizer).On October 2016, the Company
received RMB 5 million of Shenzhen strategic emerging industries and the future development
of industrial matching funds,The company will defer income share transferred in the current
profit and loss on the basis of depreciation life as of the date of the predetermined workability
state the related assets
(17). According to Reform and Development Commission of Shenzhen Municipality sending
the notice of “Reply of National Reform and Development Office on Investing in Petrifaction and
Medicine Project within Central Budget of 2013 for Industry Structure Adjustment Special
Project”(Reform and Development Commission of Shenzhen Municipality [2013]No.1449) , the
Company received 30 million RMB of new production line of TFT-LCD polarizer project period
II and equipment purchase subsidy in August 2015 ,December 2015 and September 2016.The
company will defer income share transferred in the current profit and loss on the basis of
depreciation life as of the date of the predetermined workability state the related assets reach.
(18). In 2015 and In 2016, the Company received the subsidy funds of 202,608.00 RMB and
34,535.45 RMB on energy-saving reconstruction, amortized by 8-year depreciation life of the
relevant asset, the Other income was RMB 0.00 at the current period, the ending balance without
amortization was RMB 116,101.49.
19. According to the Notice of the Ministry of Industry and Information Technology of the
National Development and Reform Commission for Releasing the Central Budgetary Investment
Plan of the 2017 of the Technical Transformation of the Electronic Information Industry (NDRC
Investment {2017} No. 1649), the company received oversize TV for use in November 2017. In
November 2017, the company received an central budgetary investment of RMB 30,000,000.00 of
the oversized TV polarizer industry project. The company shall transfer the deferred income to the
current profit or loss for the period of depreciation from the date when the relevant assets are
ready for their intended use.
20. In 2017, the company received 1,218,640.00 yuan for the old elevator upgrade subsidy,
which was apportioned according to the depreciation period of the relevant assets. The current
period was included in other income of 50,000.00 yuan, and the unassessed balance at the end of
the period was 891,796.67 yuan.
21. According to the regulations of Management Measures of Shenzhen City to Build
Shenzhen Standard Special Funds (SCG [2016] No. 7) and Operating Procedures of Shenzhen
City to Create Shenzhen Standard Special Funding (SSZG [2017] No. 2), the national standard
“Determination Method for the Adhesion of Polarizer Optical Film Coating” developed by the
company was awarded 600,000 yuan by the Shenzhen Municipal Market and Quality Supervision
and Administration Committee; the national standard “Determination of Optical Compensation
Value of Polarizer” developed by the company was funded 360,000 yuan by Shenzhen Municipal
Committee of Market and Quality Supervision and Administration, and the money arrived on
January 26, 2018.
22. In accordance with the development plans and policies of Shenzhen Municipality for
Strategic emerging Industries, the Management Measures of Shenzhen City on Funds for Scientific
and Technological Research and Development, the Management Measures of Shenzhen City on
Science and Technology Plan Project and other relevant documents, Shenzhen Science and
Technology Innovation Commission and the company completed the development of the key
technology of the 20170535 ultra-thin polarizer used in IPS smart phone terminal in the Shenzhen
Science and Technology Plan issued by SFG [2017] No. 1447 document. In February 2018, the
company received funding from Shenzhen Science and Technology Innovation Commission of
2,000,000 yuan for R & D. The company will transfer the deferred income to the current profit
and loss according to the depreciation period from the date when the relevant assets reach the
expected usable status.
23. According to the notice on Certain Measures for Promoting Scientific and Technological
Innovation (SF [2016] No. 7), the company received a corporate R&D grant of RMB 2,436,000
from the Shenzhen Science and Technology Innovation Committee on January 25, 2018.
52.Other Non-current liabilities
53.Stock capital
In RMB
Changed（+，-）
Balance in Capitalization Balance in
Issuance of
year-begin Bonus shares of public Other Subtotal year-end
new share
reserve
Total of capital
511,274,149.00 511,274,149.00
shares
54. Other equity instruments
55. Capital reserves
In RMB
Items Year-beginning balance Increase in the current Decrease in the current Year-end balance
period period
Share premium 1,848,960,987.54 1,848,960,987.54
Other 17,040,487.63 3,451,194.00 20,491,681.63
Total 1,866,001,475.17 3,451,194.00 1,869,452,669.17
Other exlanation, including changes and reasons for changes：
Confirm the current restricted stock incentive fee of RMB 3,451,194.00.
56.Treasury stock
In RMB
Decrease in the current
Items Year-beginning balance Increase in the current Year-end balance
period
Treasury stock 27,230,679.00 27,230,679.00
Total 27,230,679.00 27,230,679.00
Notes：
57. Other comprehensive income
In RMB
Amount of current period
Year-beginni Amount for Less： After - ta After - t Year-end
Items Less：
ng balance the period Previously rec x attribut ax attrib balance
Income tax
before inco ognized in pro able to th utable to
me tax fit or loss in ot e parent minorit
her comprehen company y shareh
sive income olders
2.Other comprehensive income
2,218,703.8 -559,806. -170,038. -389,76
reclassifiable to profit or loss in 1,828,936.20
7 62 95 7.67
subsequent periods
Gains and losses from changes in fair
1,500,778.5 -680,155. -170,038. -510,11
value of financial assets available for 990,661.68
0 77 95 6.82
sale
Translation differences of
120,349.1 120,349
financial statements 717,925.37 838,274.52
5 .15
denominated
Total of other comprehensive income 2,218,703.8 -559,806. -170,038. -389,76
1,828,936.20
7 62 95 7.67
58. Special reserves
59. Surplus reserve
In RMB
Items Year-beginning balance Increase in the current Decrease in the current Year-end balance
period period
Statutory surplus reserve 77,477,042.19 77,477,042.19
Total 77,477,042.19 77,477,042.19
60. Retained profits
In RMB
Items Amount of current period Amount of previous period
Retained earnings before adjustments at the year
-32,266,087.44 -81,275,828.76
beginning
Retained earnings after adjustments at the year
-32,266,087.44 -81,275,828.76
end
Add: Net profit attributable to owners of the
9,646,976.15 14,457,841.63
Company for the period
Retained profits at the period end -22,619,111.29 -66,817,987.13
As regards the details of adjusted the beginning undistributed profits
(1)As the retroactive adjustment on Enterprise Accounting Standards and its related new
regulations, the affected beginning undistributed profits are RMB 0.00.
(2) As the change of the accounting policy, the affected beginning undistributed profits are RMB
0.00.
(3) As the correction of significant accounting error, the affected beginning undistributed profits
are RMB 0.00 .
(4) As the change of consolidation scope caused by the same control, the affected beginning
undistributed profits are RMB 0.00
(5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 .
61. Business income, Business cost
In RMB
Amount of current period Amount of previous period
Items
Income Cost Income Cost
Main business 469,020,785.79 413,056,967.08 563,241,779.76 507,497,595.29
Other business 69,267,264.82 66,061,633.29 176,095,977.11 170,119,600.50
Total 538,288,050.61 479,118,600.37 739,337,756.87 677,617,195.79
62. Business tax and subjoin
In RMB
Items Amount of current period Amount of previous period
Urban construction tax 293,239.29 1,877,415.61
Education surcharge 210,850.54 1,341,011.11
Property tax 2,891,819.92 2,827,811.60
Land use tax 176,423.79 172,077.94
vehicle and vessel usage tax 3,960.00 4,800.00
Stamp tax 260,786.33 335,365.36
Other 3,476.25 30,536.23
Total 3,840,556.12 6,589,017.85
63.Sales expenses
In RMB
Items Amount of current period Amount of previous period
Wage 1,477,791.73 1,442,735.16
Exhibition fee 124,705.56 128,319.69
Business expenses 214,533.49 344,967.24
Transportation changes 1,402,849.04 1,507,900.57
Samples and product loss 179,001.34 170,061.25
Other 381,530.37 413,059.23
Total 3,780,411.53 4,007,043.14
64. Administrative expenses
In RMB
Items Amount of current period Amount of previous period
Wage 23,790,598.33 18,043,421.42
Property insurance 123,836.06 144,107.56
Repair charge 1,804,835.86 351,038.26
Business entertainment 485,191.77 394,601.48
Travel expenses 512,976.10 400,427.52
Office expenses 515,020.20 351,040.92
Water and electricity 2,017,209.50 1,310,312.83
Agency expenses 1,639,670.22 1,163,200.26
R& D 21,189,099.82 10,940,877.48
Board fees 54,119.00 29,223.00
Other 4,848,892.78 3,718,815.43
Depreciation of fixed assets 4,788,853.45 3,360,019.17
Amortization of intangible assets 648,185.46 630,995.46
Low consumables amortization 9,731.00 8,487.70
Total 62,428,219.55 40,846,568.49
65. Financial expenses
In RMB
Items Amount of current period Amount of previous period
Interest expenses 3,428,083.94 2,240,228.08
Interest income -13,277,267.58 -17,274,220.29
Exchange loss 4,824,219.83 1,753,688.28
Fees and other 1,172,376.15 1,242,947.35
Total -3,852,587.66 -12,037,356.58
66.Loss of assets impairment
In RMB
Items Amount of current period Amount of previous period
I .Losses for bad debts 278,909.76 522,788.58
II. Losses for falling price of inventory 17,115,422.28 30,137,044.41
Total 17,394,332.04 30,659,832.99
67. Gains from changes in fair value
68. Investment income
In RMB
Items Amount of current period Amount of previous period
Investment income from the disposal of
616,945.67 1,620,115.63
long-term equity investment
Hold the investment income during from
574,774.15 526,586.44
available-for-sale financial assets
Other 27,360,990.33 20,808,333.32
Total 28,552,710.15 22,955,035.39
69. Assets disposal income
70.Other income
In RMB
Source Amount of current period Amount of previous period
Government Subsidy 5,812,167.76 5,143,961.90
71. Non-Operation income
In RMB
Items Amount of current period Amount of previous period Recorded in the amount of the
non-recurring gains and losses
Government Subsidy 55,009.21 517,000.00 55,009.21
Gains from disposal of
24,597.81 1,510.00 24,597.81
non-current assets
Other 10,301.15 9,910.24 10,301.15
Total 89,905.17 528,419.77 89,905.17
Government subsidy reckoned into current gains/losses
In RMB
Whether the
impact of
Whether Amount of Amount of Assets-relate
Issuing subsidies on
Items Reason Nature special current previous d/income
subject the current
subsidies period period -related
profit and
loss
Shenzhen
City
Market and Because
Supervision research and
and development,
Management technical Relate to
Subsidy Yes No 17,000.00
Commissiona updates and income
llocated transformatio
intellectual n
property of subsidies
patent
grant
Shenzhen
Science and
Technology Because
Innovation research and
Committee development,
allocated technical Relate to
Subsidy Yes No 500,000.00
2016 updates and income
annual transformatio
science n
and of subsidies
technology
award
Shenzhen
Social Relate to
Subsidy Yes No 55,009.21
Security income
Bureau
Total -- -- -- -- -- 55,009.21 517,000.00 --
72.Non-current expenses
In RMB
Items Amount of current period Amount of previous period The amount of non-operating
gains & lossed
Non-current asset Disposition
43,338.08 3,281.59 4,338.08
loss
Other 110,000.00 196.77 110,000.00
Total 153,338.08 3,478.36 153,338.08
73.Income tax expenses
(1)Income tax expenses
In RMB
Items Amount of current period Amount of previous period
Current income tax expense 5,972,581.36 7,902,446.59
Deferred income tax expense -650,716.83 -159,488.32
Total 5,321,864.53 7,742,958.27
(2)Reconciliation of account profit and income tax expenses：
In RMB
Items Amount of current period
Total profits 9,879,963.66
Income tax computed in accordance with the applicable tax rate 2,469,990.92
Effect of different tax rate applicable to the subsidiary Company 1,302,252.17
Influence of income tax before adjustment 10,551.90
Influence of non taxable income -210,923.73
Affect the use of deferred tax assets early unconfirmed
150,670.21
deductible losses
The current period does not affect the deferred tax assets
1,599,323.06
recognized deductible temporary differences or deductible loss
Other
Income tax expense 5,321,864.53
74 .Other comprehensive income
Seen in Note 57.
75.Items of Cash flow statement
（1）Other cash received from business operation
In RMB
Items Amount of current period Amount of previous period
Government Subsidy 5,396,000.00 3,409,000.00
Bank deposit interest income and other 20,764,799.70 32,239,684.61
Total 26,160,799.70 35,648,684.61
(2)Other cash paid related to oprating activities
In RMB
Items Amount of current period Amount of previous period
R&D 15,280,060.45 10,940,877.48
Office Expense 515,020.20 351,040.92
Business fee 699,725.26 739,568.72
Travel expenses 632,243.41 400,427.52
Transportation fee 1,402,849.04 1,507,900.57
Agency Charge 1,639,670.22 1,163,200.26
Insurance expenses 123,836.06 144,107.56
Water and electricity 2,017,209.50 1,310,312.83
Rental fee 1,804,835.86 351,038.26
Exhibition expenses 124,705.56 128,319.69
Other 1,340,140.71 75,148,367.33
Total 25,580,296.27 92,185,161.14
(3)Cash received related to other investment activities
In RMB
Items Amount of current period Amount of previous period
Structured deposits, financial products,
1,903,828,974.66 2,205,083,032.64
principal and income
Total 1,903,828,974.66 2,205,083,032.64
(4).Cash paid related to other investment activities
In RMB
Items Amount of current period Amount of previous period
Structure deposit investment 1,830,500,000.00 1,883,000,000.00
Total 1,830,500,000.00 1,883,000,000.00
（5）Other cash received in relation to financing activities
In RMB
Items Amount of current period Amount of previous period
Obtain loans from affiliated parties 6,809,000.00
Total 6,809,000.00
76. Supplement Information for cash flow statement
（1）Supplement Information for cash flow statement
In RMB
Items Amount of current period Amount of previous period
I. Adjusting net profit to cash flow from
-- --
operating activities
Net profit 4,558,099.13 12,536,435.62
Add: Impairment loss provision of assets -3,940,075.77 -164,403.72
Depreciation of fixed assets, oil and gas
40,523,419.76 40,264,166.05
assets and consumable biological assets
Amortization of intangible assets 620,162.74 630,995.46
Amortization of Long-term deferred
155,136.82 148,559.98
expenses
Loss on scrap of fixed assets 43,338.08 3,281.59
Financial cost -3,852,587.66 -13,992,394.49
Loss on investment -28,152,710.15 -22,955,035.39
Decrease in deferred income tax assets -650,716.83 159,488.32
Decrease of inventories -45,300,979.12 -13,178,629.92
Decease of operating receivables -78,431,655.56 -56,290,615.85
Increased of operating Payable -14,422,320.88 -45,338,248.59
Net cash flows arising from operating
-128,850,889.44 -98,176,400.94
activities
II. Significant investment and financing -- --
activities that without cash flows:
3．Movement of cash and cash equivalents： -- --
Ending balance of cash 1,014,735,793.86 1,017,636,623.46
Less: Beginning balance of cash equivalents 1,161,240,139.33 930,114,436.57
Net increase of cash and cash equivalents -146,504,345.47 87,522,186.89
(2) Composition of cash and cash equivalents
In RMB
Items Year-end balance Year-beginning balance
I. Cash 1,014,735,793.86 1,161,240,139.33
Including：Cash at hand 1,720.24 17,771.09
Demand bank deposit 1,012,714,691.65 1,159,202,998.15
Demand other monetary funds 2,019,381.97 2,019,370.09
III. Balance of cash and cash equivalents at
1,014,735,793.86 1,161,240,139.33
the period end
77. Note of statement of changes in the owner's equity
78. The assets with the ownership or use right restricted
79. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Closing foreign currency Closing convert to RMB
Items Exchange rate
balance balance
Including：USD 1,362,638.73 6.6166 9,016,035.42
HKD 471,035.43 0.8431 397,129.97
JPY 2,034,840.00 0.059914 121,915.40
Including：USD 5,663,343.89 6.6166 37,472,081.18
HKD 278,280.00 0.8431 234,617.87
Other receivable
Including：USD 37,399.02 6.6166 247,454.36
Account payable
Including： HKD 2,010,068.33 0.8431 1,694,688.61
USD 1,021,849.50 6.6166 6,761,169.40
JPY 211,992,000.00 0.059914 12,701,288.69
Account payable
Including：USD 2,512,331.38 6.6166 16,623,091.81
JPY 494,151,302.66 0.059914 29,606,581.15
Short-term loans
Including：USD 6,408,298.91 6.6166 42,401,150.57
JPY 768,403,787.00 0.059914 46,038,144.49
Interest payable
Including：USD 52,815.07 6.6166 349,456.19
80. Hedging
81.Other
VIII. Changes of consolidation scope
1. Enterprise consolidation not under the same control
2. Business combination under the same control
3. Counter purchase
4. The disposal of subsidiary
Whether there is a single disposal of the investment to subsidiary and lost control
□ Yes √ No
Whether there are multiple transactions step by step dispose the investment to subsidiary and lost
control in reporting period
□ Yes √ No
IX. Equity in other entity
1. Equity in subsidiary
（1）Constitute of enterprise group
Share-holding ratio
Subsidiary Main operation Registered place Business nature Acquired way
Directly Indirectly
Shenzhen Lishi
Domestic trade,
Industry 100.00% Establish
Shenzhen Shenzhen Property
Development Co.,
Management
Ltd
Accommodation, Establish
Shenzhen 100.00%
Shenzhen Shenzhen restaurants,
Huaqiang Hotel
business center;
Shenfang
Property Property 100.00% Establish
Shenzhen Shenzhen
Management Co., Management
Ltd.
Production of Establish
Shenzhen Beauty
fully electronic 100.00%
Century Garment Shenzhen Shenzhen
jacquard knitting
Co., Ltd.
whole shape
Shenzhen Establish
Polarizer
Shengbo
Ophotoelectric Shenzhen Shenzhen production and 60.00%
Technology Co.,
sales
Ltd
Shenzhen
Shenfang Import Operating import Establish
Shenzhen Shenzhen 60.00%
& export Co., and export
Ltd. business
Shengtou Establish
(Hongkong) Production and
Hongkong Hongkong 60.00%
sales of polarizer
Co.,Ltd.
（2）Significant not wholly-owned subsidiaries
In RMB
Profit or loss attributable
Holding proportion of Dividend declared to Closing balance of
Name to non-controlling
non-controlling interest non-controlling interest non-controlling interest
interest
Shenzhen Shengbo
Ophotoelectric 40.00% -5,088,877.02 0.00 1,121,281,524.77
Technology Co., Ltd
（3）Main financial information of significant not wholly-owned subsidiaries
In RMB
Closing balance Beginning balance
Non-curr Non-curr
Subsidia Non-curr Non-curr
Current Total Current ent Total Current Total Current ent Total
ries ent ent
assets assets liabilities Liabilitie liabilities assets assets liabilities Liabilitie liabilities
assets assets
s s
Shenzhe 2,238,5 1,109,9 3,348,5 2,225,7 1,056,0 3,281,8
393,602 172,700 566,302 328,224 172,994 501,219
n 54,050. 80,295. 34,345. 95,205. 83,463. 78,668.
,324.26 ,141.65 ,465.91 ,382.21 ,880.83 ,263.04
Shengbo 83 03 86 28 64 92
Ophotoel
ectric
Technolo
gy Co.,
Ltd
In RMB
Current term Last term
Cash flow Cash flow
Total Total
Subsidiaries Operating from Operating from
Net profit comprehensi Net profit comprehensi
revenue operating revenue operating
ve income ve income
activities activities
Shenzhen
Shengbo
392,382,938 -13,141,819 -13,141,819 -123,066,99 377,252,892 -9,376,931. -9,376,931. -129,287,75
Ophotoelectri
.55 .59 .59 7.41 .13 35 35 6.72
c Technology
Co., Ltd
2. The transaction of the Company with its owner’s equity share changed but still controlling the
subsidiary
3. Equity in joint venture arrangement or associated enterprise
(1) Significant joint venture arrangement or associated enterprise
Shareholding Ratio (%) The accounting
Name of Main Places of Registration Nature of treatment of
Subsidiary Operation Place Business direct indirect investment in
associates
Shenzhen Haohao
Property Leasing Shenzhen Shenzhen Property leasing 50.00% Equity method
Co., Ltd.
Shenzhen
Changlianfa
Shenzhen Shenzhen Property leasing 40.25% Equity method
Printing and
dyeing Company
Jordan Garment
Jordan Jordan Manufacturing 35.00% Equity method
Factory
Yehui
International Co., Hongkong Hongkong Manufacturing 22.75% Equity method
Ltd.
（2）.The Summarized Financial Information of Unimportant Joint Ventures and Associated
Enterprises
In RMB
Year-end balance/ Amount of current Year-beginning balance/ Amount of
period previous period
Joint venture： -- --
Total book value of the investment 5,363,311.33 5,369,450.56
Total amount of the pro rata calculation of
-- --
the following items
-- Net profit 393,860.77 262,962.99
-- Total comprehensive income 393,860.77 262,962.99
Associated enterprise： -- --
Total book value of the investment 15,156,262.05 15,011,284.00
Total amount of the pro rata calculation of
-- --
the following items
--Net profit 223,084.90 838,516.63
--Other Comprehensive income 120,349.15 -885,191.31
--Total comprehensive income 343,434.05 -46,674.68
(3) Significant common operation
Proportion /shareportion
Name Main operating place Registration place Business nature
Directly Indirectly
Guanhua Building Shenzhen Shenzhen Cooperate 50.16%
Other notes
According to the company along with Hongkong Qiaohui Industries Co.,Ltd. signed "Agreement
on cooperative development and construction of Guanhua building", jointly developed Guanhua b
uilding construction, the company invested 50.16%, Hong Qiao Hui Industrial Co., Ltd. invested 4
9.84%, the two sides need to agree matters affecting the cooperation projects.
Guanhua Building project has been completed in the current reporting period, and the two parities
carried out the
split according to the actual investment ratio of 50.16% and 49.84%.
X. The risk related financial instruments
XI. Disclosure of fair value
1. Ending fair value of the assets and liabiliies measured by fair value
In RMB
Ending fair value
Items
First-order Second-order Third-order Total
I. Consistent fair value
-- -- -- --
measurement
(1).Available for sale
7,314,138.86 7,314,138.86
financial assets
1.Equity instrument
7,314,138.86 7,314,138.86
investment
Total of Consistent fair
7,314,138.86 7,314,138.86
value measurement
II. Non –persistent
-- -- -- --
measure
2. Market price recognition basis for consistent and inconsistent fair value measurement items at
level
The fair value of financial assets available for sale at the end of period is measured based on the
closing price of Shenzhen Stock Exchange on June 29,2018.
XII. Related parties and related-party transactions
1.Parent company information of the enterprise
Registered capital The parent company The parent company
Name Registered address Nature of the Company's of the Company’s
（ten thousand） shareholding ratio vote ratio
18/F, Investment Equity investment ,
Shenzhen
Building, Shennan Real-estate
Investment Holdings 23,149 million 46.21% 49.39%
Road, Futian Development and
Co.,Ltd.
District, Shenzhen Guarantee
Notes
The company is authorized and approved to be state-owned independent company by Shenzhen
Government, and it Executes financial contributor function on state-owned enterprise within
authorization scope.
The finial control of the Company was Shenzhen People’s Govemment state owned assets
supervision & Administration Commission.
2.Subsidiaries of the Company
Details refer to the Note IX-1, Interest in the subsidiary
3. Information on the joint ventures and associated enterprises of the Company
Details refer to the Note IX-3, Interests in joint ventures or associates
Information on other joint venture and associated enterprise of occurring related party transactions
with the Company in reporting period, or form balance due to related party transactions in
previous period:
Name Relation of other Related parties with the company
Shenzhen Haohao Property Leasing Co., Ltd. Sharing Company
Shenzhen Changlianfa Printing and dyeing Company Sharing Company
Yehui International Co., Ltd. Sharing Company
Anhui Huapeng Textile Co., Ltd. Sharing Company
Shenzhen Xinfang Knitting Co., Ltd. Sharing Company
Shenzhen Dailishi Underwear Co., Ltd. Sharing Company
4.Other Related parties information
Other related party Relationship to the Company
Shenzhen Shenchao Technology Investment Co., Ltd. Subject to the same party controls
Shenzhen Tianma Microelectronics Co., Ltd. Chairman of the Board Is the Vice Chairman of the Company
Shengbo （HK）Co., Ltd. The Company Executives are Director of the company
Shenzhen Xiangjiang Trade Co., Ltd. Sharing Company
On the subsidiary Shenzhen Shengbo Optoelectronics Technology
Hangzhou Jinjiang Group Co., Ltd. Co., Ltd. has a significant impact on the actual control of the
shareholders controlled by the enterprise
Kunshan Zhiqimei Material Technology Co., Ltd. Sharing Company
5. Related transactions.
（1）Related transactions on purchasing goods and receiving services
Acquisition of goods and reception of labor service
In RMB
Whether over the
Related party Content Current amount Approval trading limit Last amount
trading limit(Y/N)
Kunshan Zhiqimei
Material Purchasing
14,103,038.28 18,602.39
Technology Co., polarizer
Ltd.
Related transactions on sale goods and receiving services
In RMB
Related parties Content of related transaction Amount of current period Amount of previous period
Shenzhen Tianma
Sales polarizer sheet 1,166,047.31 3,044,298.73
Microelectronics Co., Ltd.
（2）Key managements payment
In RMB
Items 2018 payment 2017 payment
Key managements payment 2,643,194.00 1,897,026.00
（3）Other related transactions
In order to carry out TFT-LCD polarizer project construction, the company signed an
entrusted loan contract with Shenzhen Shenchao Technology Investment Co., Ltd. and Shenzhen
Jiangsu Building Branch of Ping An Bank in 2010. The contract stipulates that Shenzhen
Shenchao Science & Technology Investment Co., Ltd. entrusts Shenzhen Jiangsu Building Branch
of Ping An Bank to loan 200,000,000.00 yuan to the Company. The term of the loan was 108
months from the date the first entrusted loan was issued to the company's account. The entrusted
loan interest rate was lowered by 2% based on the 5-year commercial loan interest rate announced
and issued by the People's Bank of China. In case of adjustments to the 5-year commercial loan
interest rate of the People's Bank of China, from the first day of the next month of the benchmark
interest rate adjustment, the entrusted loan interest rate will be lowered by two percentage points
according to the adjusted 5-year commercial loan interest rate. As of June 30, 2018, the balance of
the company's borrowings was 40 million yuan.
6. Receivables and payables of related parties
（1）Receivables
In RMB
Amount at year end Amount at year beginning
Name Related party
Balance of Book Bad debt Provision Balance of Book Bad debt Provision
Account receivable Shenzhen Tianma 688,530.73 34,426.54 1,555,500.44 77,775.02
Microelectronics
Co., Ltd.
Other Account Anhui Huapeng
1,800,000.00 1,800,000.00 1,800,000.00 1,800,000.00
receivable Textile Company
Other Account Shenzhen Dailishi
500,000.00 25,000.00 440,508.46 22,025.42
receivable Underwear Co., Ltd.
Kunshan Zhiqimei
Account receivable Material Technology 499,445.21 24,972.26
Co., Ltd.
（2）Payables
In RMB
Name Related party Amount at year end Amount at year beginning
Shenzhen Xinfang Knitting Co.,
Other payable 244,789.85 244,789.85
Ltd.
Shenzhen Changlianfa Printing
Other payable 1,178,449.95 1,178,449.95
and dyeing Co., Ltd.
Shenzhen Haohao Property
Other payable 4,454,489.85 4,104,489.85
Leasing Co., Ltd.
Other payable Yehui International Co.,Ltd. 1,145,111.18 1,135,399.49
Other payable Shengbo （Hongkong）Co., Ltd. 315,000.00 315,000.00
Shenzhen Shenchao Technology
Interest payable 46,643,162.06 45,570,662.08
Investment Co., Ltd.
XIII.Share payment
1. Overall situation of share payment
√ Applicable □Not applicable
In RMB
Total amount of various equity instruments granted by the company
0.00
during the current period
Total amount of various equity instruments that the company exercises
0.00
during the period
Total amount of various equity instruments that have expired in the
0.00
current period
The scope of executive price of the company’s other equity instruments at
the end of the period and the remaining term of the contract The company issued 4,752,300 restricted stocks at the
end of the period, and the grant price was 5.73
yuan/share. Restrictions shall be lifted at the rate of
40%, 30%, and 30% respectively after 12 months, 24
months, and 36 months after the first transaction date of
24 months after the completion of the registration. The
period of validity of the entire plan shall not exceed 60
months from the date of granting the restricted stock to
the date on which the restricted stocks granted to the
incentive object are all released from restrictions on
sale or cancelled by repurchase.
Other notes
On December 14, 2017, the company's 3rd Extraordinary General Meeting of Shareholders
in 2017 passed the Proposal on ‘Shenzhen Textile (Group) Co., Ltd. 2017 Restricted Stock
Incentive Plan (Draft) and Abstract’; on December 14, 2017, the board of directors of the
company reviewed and passed the Proposal on Adjusting the List of Incentive Objects of
Restricted Stock Incentive Plans and the Number of Equity Granted of 2017, and the Proposal on
Granting Restrictive Shares to Incentive Objects. On December 14, 2017, the company granted
4,752,300 restricted shares to the incentive object, the grant price was 5.73 yuan/share.
Restrictions shall be lifted at the rate of 40%, 30%, and 30% respectively after 12 months, 24
months, and 36 months after the first transaction date of 24 months after the completion of the
registration. The company's performance assessment for the restricted shares granted each period
is as follows:
Restriction lifting period：
The first restriction lifting period
In 2018, the earnings per share shall be no less than 0.07 yuan, and shall not be lower than
the 75 fractiles level of the comparable listed companies in the same industry; the growth rate of
operating revenue in 2018 compared with 2016 is not less than 70%, and is not lower than the 75
fractiles level of comparable listed companies in the same industry; in 2018, the proportion of
optical film business such as polarizers to operating revenue is no less than 70%.
The second restriction lifting period
In 2019, earnings per share shall be no less than 0.08 yuan, and shall not be lower than the
75 fractiles level of the comparable listed companies in the same industry; the growth rate of
operating revenue in 2019 compared with 2016 is not less than 130%, and is not lower than the 75
fractiles level of comparable listed companies in the same industry; in 2019, the proportion of
optical film business such as polarizers to operating revenue is not less than 75%
The third restriction lifting period
In 2020, the earnings per share shall be no less than 0.20 yuan, and shall not be lower than
the 75 fractiles level of comparable listed companies in the same industry; the growth rate of
operating revenue in 2020 is not less than 200% compared to 2016, and is not lower than the 75
fractiles level of comparable listed companies in the same industry. In 2020, the proportion of
optical film business such as polarizers to operating revenue will be no less than 80%.
2. Equity-settled share-based payment
√ Applicable □Not applicable
In RMB
Determination method of the fair value of equity instruments on the The closing price of the company's stock on grant date - grant
grant date price
On each balance sheet date of the waiting period, it is
determined based on the latest information such as the change
Determination basis of the number of vesting equity instruments
in the number of people that can be released from restrictions
and the completion of performance indicators
The reasons for the significant difference between the current
Nil
estimate and the previous estimate
Equity-settled share-based payment is included in the accumulated
3,735,685.54
amount of capital reserve
Total amount of fees confirmed by equity-settled share-based
4,277,070.00
payments in the current period
3. The Stock payment settled by cash
□ Applicable √ Not applicable
4. Modification and termination of the stock payment
Nil
5.Other
XIV. Commitments
1.Importance commitment events
Important commitments of not existence of balance sheet date
2. Contingency
(1) Significant contingency at balance sheet date
（2）The Company have no significant contingency to disclose, also should be stated
The was no significant contingency in the Company.
XV. Notes s of main items in financial reports of parent company
（1）Account receivable
1.Classification account receivables.
In RMB
Amount in year-end Amount in year-beginning
Book Balance Bad debt provision Book Balance Bad debt provision
Category Book
Amount Proportio Amount Proportio Amount Proportio Amount Proportion( Book value
value
n(%) n(%) n(%) %)
Account receivables
provided bad debt 575,125 28,756. 546,368. 473,19 23,659.7 449,536.2
100.00% 5.00% 100.00% 5.00%
provision in credit .08 25 83 6.00 9 1
risk groups
575,125 28,756. 546,368. 473,19 23,659.7 449,536.2
Total 100.00% 5.00% 100.00% 5.00%
.08 25 83 6.00 9 1
Receivable accounts with large amount individually and bad debt provisions were provided.
□ Applicable √ Not applicable
Account reveivable on which bad debt proisions are provided on age basis in the group
√ Applicable □Not applicable
In RMB
Amount in year-end
Aging
Account reivable Provision for bad debts Proportion%
Within item 1 year
Subtotal within 1 year 575,125.08 28,756.25 5.00%
Total 575,125.08 28,756.25 5.00%
Notes：
Receivable accounts on which had debt provisions are provided on percentage analyze basis in a
portfolio
□Applicable √Not applicable
Receivable accounts on which had debt provisions are provided by other ways in the portfolio
（2）Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision during the reporting period was of RMB
5,096.46;The amount of the reversed or collected part during the reporting period was of
RMB0.00.
2. Other accounts receivable
(1) Other accounts receivable disclosed by category
In RMB
Amount in year-end Amount in year- begin
Category
Book Balance Bad debt provision Book Book Balance Bad debt provision Book value
Proportio Proportio value Proportio Proportion(
Amount Amount Amount Amount
n(%) n(%) n(%) %)
Other Accounts
receivable of
individual 13,781
13,781, 13,781, 13,781,4
significance and 49.99% 92.28% ,464.6 67.70% 100.00%
464.60 464.60 64.60
subject to individual 0
impairment
assessment
Other Accounts
receivable subject to
impairment 13,477, 840,876 12,636,4 6,262, 480,146. 5,782,620
48.88% 5.63% 30.77% 7.67%
assessment by credit 375.01 .78 98.23 767.01 38 .63
risk characteristics of
a portfolio
Other Accounts
receivable of
individual
311,486 311,486 311,48 311,486.
insignificance but 1.13% 2.09% 1.53% 100.00%
.35 .35 6.35 35
subject to individual
impairment
assessment
20,355
27,570, 14,933, 12,636,4 14,573,0 5,782,620
Total 100.00% ,717.9 100.00%
325.96 827.73 98.23 97.33 .63
6
Other Receivable accounts with large amount individually and bad debt provisions were provided
√ Applicable □ Not applicable
In RMB
Balance at year-end
Other receivable （Unit）
Other receivable Provision for bad debts Proportion% Reason
Jiangxi Xuanli String Co., No executable property,
11,389,044.60 11,389,044.60 100.00%
Ltd. unlikely to recover.
Anhui Huapeng Textile
1,800,000.00 1,800,000.00 100.00% Estimated irrecoverable
Co.,Ltd.
Shenzhen Tianlong Has been conceled,
592,420.00 592,420.00 100.00%
Induatry& Trade Co., Ltd. unlikely to recover
Total 13,781,464.60 13,781,464.60 -- --
（2）In the groups, other accounts receivable adopting aging analysis method to withdraw
bad debt provision:
√ Applicable □ Not applicable
In RMB
Amount in year-end
Aging
Other receivable Bad debt provision Withdrawal proportion
Subitem Within 1 year
Subtotal within 1 year 12,208,426.23 610,421.31 5.00%
1-2 years 1,010,047.30 101,004.73 10.00%
Over 3 years 258,901.48 129,450.74 50.00%
Total 13,477,375.01 840,876.78
Notes：
Other receivable account in Group on which bad debt provisions were provided on percentage
basis：
□Applicable √Not applicable
Other Receivable accounts on which bad debt provisions are provided by other ways in the
portfolio：
□Applicable √Not applicable
（2）Bad debt provision accrual collected or switch back
Bad debt provision accrual was RMB335,730.40, the acount collected or switches back amounting
to RMB 0.00.
Significant amount of reversed or recovered bad debt provision：
In RMB
Name Amount Method
(3) Other account receivables category by nature of money
In RMB
Category Year-end balance Year-beginning balance
Internal current account 12,888,758.00 5,075,600.00
Unit account 14,607,817.96 15,206,367.96
Other 73,750.00 73,750.00
Total 27,570,325.96 20,355,717.96
(4)Top 5 of the closing balance of the other accounts receivable colleted according to the arrears
party
In RMB
Name Nature Year-end balance Age Portion in total other Bad debt provision
receivables(%) of year-end balance
First Unit account 12,575,600.00 Over 1-2 years 45.61% 11,389,044.60
Second Unit account 11,389,044.60 Over 5 years 41.31% 712,800.00
Third Unit account 1,800,000.00 1-2 years 6.53% 1,800,000.00
Fourth Unit account 592,420.00 Over 5 years 2.15% 592,420.00
Fifth Unit account 575,125.08 Within 1 year 2.08% 28,756.25
Total -- 26,932,189.68 -- 14,523,020.85
3.Long-term equity investment
In RMB
Year-end balance Year-beginning balance
Items Bad debt Bad debt
Book balance Book value Book balance Book value
provision provision
Investment to the
1,983,892,472. 1,967,309,843. 1,981,050,902. 1,964,468,273.
16,582,629.30 16,582,629.30
97 67 97 67
subsidiary
Investment to
joint ventures and
20,519,573.38 0.00 20,519,573.38 20,380,734.56 20,380,734.56
associated
enterprises
2,004,412,046. 1,987,829,417. 2,001,431,637. 1,984,849,008.
Total 16,582,629.30 16,582,629.30
35 05 53 23
（1）Investment to the subsidiary
In RMB
Withdrawn
Closing balance
impairment
Name Opening balance Increase Decrease Closing balance of impairment
provision in the
provision
reporting period
Shenzhen Shengbo
Optoelectrionc 1,924,842,841. 1,926,907,531.
2,064,690.00 0.00 14,415,288.09
Technology Co., 18 18
Ltd.
Shenzhen Lisi
Industrial
8,080,587.80 86,400.00 8,166,987.80
Development Co.,
Ltd.
Shenzhen Beauty
30,895,388.23 335,880.00 31,231,268.23 2,167,341.21
Centruty Garment
Co., Ltd.
Shenzhen
15,499,430.44 120,960.00 15,620,390.44
Huaqiang Hotal
Shenfang Property
Management Co., 1,732,655.32 233,640.00 1,966,295.32
Ltd.
1,981,050,902. 1,983,892,472.
Total 2,841,570.00 16,582,629.30
97 97
（2）Investment to joint ventures and associated enterprises
In RMB
Increase /decrease in reporting period
Closing
Adjustme
Withdraw balance
Decrease Gain/loss nt of Declarati
Opening Add Other n Closing of
Name d of other on of cash
balance investmen equity impairme Other balance impairme
investmen Investme comprehe dividends
t changes nt nt
t nt nsive or profit
provision provision
income
I. Joint ventures
Shenzhen
Haohao
5,369,45 393,860. 400,000. 5,363,31
Property
0.56 77 00 1.33
Leasing
Co., Ltd
5,369,45 393,860. 400,000. 5,363,31
Subtotal
0.56 77 00 1.33
II. Associated enterprises
Shenzhen
Changlian
fa
2,107,15 96,088.6 2,203,24
Printing
5.01 3 3.64
and
dyeing
Company
Jordan
2,233,90 -68,777. 27,739.8 2,192,86
Garnent
2.64 00 5 5.49
Factory
Yehui
Internatio 10,670,2 195,773. 92,609.3 198,456. 10,760,1
nal Co., 26.35 27 0 00 52.92
Ltd.
15,011,2 223,084. 120,349. 198,456. 15,156,2
Subtotal
84.00 90 15 00 62.05
20,380,7 616,945. 120,349. 598,456. 20,519,5
Total 0.00
34.56 67 15 00 73.38
4.Business income and Business cost
In RMB
Amount of current period Amount of previous period
Items
Business income Business cost Business income Business cost
Income from Main
31,576,065.65 5,166,425.81 30,244,081.73 4,477,749.55
Business
Other Business income 1,767,833.77 1,767,833.77 1,605,516.30 1,605,516.29
Total 33,343,899.42 6,934,259.58 31,849,598.03 6,083,265.84
5.Investment income
In RMB
Items Amount of current period Amount of previous period
Income from long-term equity investment
616,945.67 1,620,115.63
measured by adopting the Equity method
Investment income received from holding of
574,774.15 526,586.44
available-for –sale financial assets
Total 1,191,719.82 2,146,702.07
6.Other
XVI. Supplement information
1. Particulars about current non-recurring gains and loss
√ Applicable □ Not applicable
In RMB
Items Amount Notes
Non-current asset disposal gain/loss -43,338.08
Govemment subsidy recognized in current
gain and loss(excluding those closely related
5,812,167.76
to the Company’s business and granted
under the state’s policies)
Gain/loss on entrusting others with
28,152,710.15
investment or asset managemen
Other non-business income and expenditures -20,094.83
other than the above
Less :Influenced amount of income tax 231,421.06
Influenced amount of minor shareholders’
13,205,732.87
equity (after tax)
Total 20,464,291.07 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to
the definition in the Explanatory Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public-Extraordinary Gains and Losses, or classifies any
extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent
gain/loss item.
□ Applicable √Not applicable
2. Return on net asset and earnngs per share
Earningspershare
Profit of report period Weightedaverage retureon eqiuty(%) Basicearningspershare(R Diluted eqrnings per
MB/share） share(RMB/share)
Net profit attributable to the
Common stock shareholders of 0.40% 0.02 0.02
Company.
Net profit attributable to the
Common stock shareholders of
-0.45% -0.0212 -0.0212
Company after deducting of
non-recurring gain/loss.
3. Differences between accounting data under domestic and overseas accounting standards
(1) Differences of net profit and net assets disclosed in financial reports prepared under
international and
Chinese accounting standards
□ Applicable √Not applicable
(2) Differences of net profit and net assets disclosed in financial reports prepared under overseas
and
Chinese accounting standards
□ Applicable √Not applicable
4.Other
