2014 Semi-annual Report of Konka Group Co., Ltd.
KONKA GROUP CO., LTD.
2014 SEMI-ANNUAL REPORT
2014-42
August 2014
1
2014 Semi-annual Report of Konka Group Co., Ltd.
Section I. Important Reminders, Contents & Definitions
The Board of Directors, the Supervisory Committee as well as all directors,
supervisors and senior management staff of Konka Group Co., Ltd. (hereinafter
referred to as “the Company”) warrant that this report is factual, accurate and
complete without any false record, misleading statement or material omission. And
they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company plans not to distribute cash dividends or bonus shares or turn capital
reserve into share capital.
Wu Siyuan, company principal, Huang Zhiqiang, chief of the accounting work, and Xu
Youshan, chief of the accounting organ (chief of accounting), hereby confirm that
the Financial Report enclosed in this report is factual, accurate and complete.
This report is prepared in both Chinese and English. Should there be any discrepancy
between the two versions, the Chinese version shall prevail.
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2014 Semi-annual Report of Konka Group Co., Ltd.
Contents
2014 Semi-annual Report................................................................................................................ 1
Section I. Important Reminders, Contents & Definitions................................................. 2
Section II. Company Profile........................................................................................................7
Section III. Highlights of Accounting Data & Financial Indicators........................... 9
Section IV. Report of the Board of Directors................................................................... 11
Section V. Significant Events..................................................................................................24
Section VI. Change in Shares & Shareholders..................................................................... 40
Section VII. Preferred Shares..................................................................................................45
Section VIII. Directors, Supervisors & Senior Management Staff............................... 46
Section IX. Financial Report....................................................................................................47
Section X. Documents Available for Reference................................................................. 248
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2014 Semi-annual Report of Konka Group Co., Ltd.
Definitions
Refe
Term Definition
rs to
Refe
Company, the Company, the Group Konka Group Co., Ltd.
rs to
Refe
Telecommunication Technology Shenzhen Konka Telecommunications Technology Co., Ltd.
rs to
Video & Communication Systems Refe Shenzhen Konka Video & Communication Systems Engineering Co.,
Engineering rs to Ltd.
Refe
Precision Mold Shenzhen Konka Precision Mold Manufacturing Co., Ltd.
rs to
Refe
Konka Household Appliances Shenzhen Konka Household Appliances Co., Ltd.
rs to
Refe
Information Network Shenzhen Konka Information Network Co., Ltd.
rs to
Refe
Plastic Products Shenzhen Konka Plastic Products Co., Ltd.
rs to
Refe
Electrical Appliances Shenzhen Konka Electrical Appliances Co., Ltd.
rs to
Refe
Fittings Technology Shenzhen Konka Electronic Fittings Technology Co., Ltd.
rs to
Refe
Mudanjiang Appliances Mudanjiang Arctic Ocean Appliances Co., Ltd.
rs to
Refe
Shanxi Konka Shanxi Konka Electronic Co., Ltd.
rs to
Refe
Chongqing Konka Chongqing Konka Electronic Co., Ltd.
rs to
Refe
Chongqing Electronic Chongqing Konka Automotive Electronic Co., Ltd.
rs to
Refe
Chongqing Qingjia Chongqing Qingjia Electronics Co., Ltd.
rs to
Refe
Anhui Konka Anhui Konka Electronic Co., Ltd.
rs to
Refe
Anhui Household Appliances Anhui Konka Household Appliances Co., Ltd.
rs to
Refe
Changshu Konka Changshu Konka Electronic Co., Ltd.
rs to
Refe
Kunshan Konka Kunshan Konka Electronic Co., Ltd.
rs to
4
2014 Semi-annual Report of Konka Group Co., Ltd.
Refe
Dongguan Konka Dongguan Konka Electronic Co., Ltd.
rs to
Refe
Dongguan Packing Dongguan Konka Packing Materials Co., Ltd.
rs to
Refe
Dongguan Mould Plastic Dongguan Konka Mould Plastic Co., Ltd.
rs to
Refe
Boluo Konka Boluo Konka PCB Co., Ltd.
rs to
Refe
Boluo Precision Boluo Konka Precision Technology Co., Ltd.
rs to
Refe
Nanhai Institute Konka (Nanhai) Development Center
rs to
Refe
Hong Kong Konka Hong Kong Konka Co., Ltd.
rs to
Refe
Konka Household Appliances Investment Konka Household Appliances Investment & Development Co., Ltd.
rs to
Konka Household Appliances Refe
Konka Household Appliances International Trading Co., Ltd.
International Trading rs to
Refe
Konka America Konka America, Inc.
rs to
Refe
Konka Europe Konka (Europe) Co., Ltd.
rs to
Refe
Xutongda Dongguan Xutongda Mould Plastic Co., Ltd.
rs to
Refe
Konka Optoelectronic Shenzhen Konka Optoelectronic Technology Co., Ltd.
rs to
Refe
Wankaida Shenzhen Wankaida Science and Technology Co., Ltd.
rs to
Refe
Kunshan Kangsheng Kunshan Kangsheng Investment Development Co., Ltd.
rs to
Refe
Anhui Tongchuang Anhui Konka Tongchuang Household Appliances Co., Ltd.
rs to
Refe
Indonesia Konka Indonesia Konka Electronics Co., Ltd.
rs to
Refe
Shushida Logistics Shenzhen Shushida Logistics Service Co., Ltd.
rs to
Refe
Beijing Konka Electronic Beijing Konka Electronic Co., Ltd.
rs to
Refe
Kunshan Jielunte Kunshan Jielunte Mould Plastic Co. , Ltd.
rs to
Refe
Wuhan Jielunte Wuhan Jielunte Mould Plastic Co. , Ltd.
rs to
Refe
Chuzhou Jielunte Chuzhou Jielunte Mould Plastic Co. , Ltd.
rs to
CSRC Refe China Securities Regulation Commission
5
2014 Semi-annual Report of Konka Group Co., Ltd.
rs to
Refe
SZSE Shenzhen Stock Exchange
rs to
Refe
CSRC Shenzhen Bureau Shenzhen Bureau of China Securities Regulation Commission
rs to
Yuan, Ten thousand Yuan, One Hundred Refe
RMB Yuan, RMB Ten thousand, RMB One Hundred Million Yuan
Million Yuan rs to
6
2014 Semi-annual Report of Konka Group Co., Ltd.
Section II. Company Profile
I. Basic information of the Company
Stock abbreviation SKJA, SKJB Stock code 000016, 200016
Stock abbreviation
Naught
after change (if any)
Stock exchange listed
Shenzhen Stock Exchange
with
Chinese name of the
康佳集团股份有限公司
Company
Abbr. of the Chinese
name of the Company (if 康佳集团
any)
English name of the
KONKA GROUP CO.,LTD
Company (if any)
Abbr. of the English
name of the Company (if KONKA GROUP
any)
Legal representative of
Wu Siyuan
the Company
II. Contact information
Company Secretary Securities Affairs Representative
Name Xiao Qing Wu Yongjun
Secretariat to the Board of Secretariat to the Board of
Directors, Konka Group Co., Ltd., Directors, Konka Group Co., Ltd.,
Contact address Overseas Chinese Town, Nanshan Overseas Chinese Town, Nanshan
District, Shenzhen, Guangdong District, Shenzhen, Guangdong
Province, China Province, China
Tel. 0755-26608866 0755-26608866
Fax 0755-26600082 0755-26600082
E-mail szkonka@konka.com szkonka@konka.com
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2014 Semi-annual Report of Konka Group Co., Ltd.
III. Other information
1. Ways to contact the Company
Did any change occur to the registered address, office address and their postal codes,
website address and email address of the Company during the reporting period?
□ Applicable √ Inapplicable
The registered address, office address and their postal codes, website address and
email address of the Company did not change during the reporting period. The said
information can be found in the 2013 Annual Report.
2. About information disclosure and where this report is placed
Did any change occur to information disclosure media and where this report is placed
during the reporting period?
□ Applicable √ Inapplicable
The newspapers designated by the Company for information disclosure, the website
designated by CSRC for disclosing this report and the location where this report is
placed did not change during the reporting period. The said information can be found
in the 2013 Annual Report.
3. Change of the registered information
Did any change occur to the registered information during the reporting period?
□ Applicable √ Inapplicable
The registration date and place of the Company, its business license No., taxation
registration No. and organizational code did not change during the reporting period.
The said information can be found in the 2013 Annual Report.
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2014 Semi-annual Report of Konka Group Co., Ltd.
Section III. Highlights of Accounting Data & Financial
Indicators
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years
due to change of any accounting policy or correction of any accounting error?
□ Yes √ No
Same period of last
Reporting period YoY +/- (%)
year
Operating revenues (RMB Yuan) 8,398,300,541.63 9,421,399,281.00 -10.86%
Net profit attributable to
shareholders of the Company (RMB 45,360,110.62 40,547,673.62 11.87%
Yuan)
Net profit attributable to
shareholders of the Company after
-171,933,579.53 13,903,675.19 -1,336.61%
extraordinary gains and losses (RMB
Yuan)
Net cash flows from operating
1,207,928,081.12 2,271,690,220.43 -46.83%
activities (RMB Yuan)
Basic EPS (RMB Yuan/share) 0.0377 0.0337 11.87%
Diluted EPS (RMB Yuan/share) 0.0377 0.0337 11.87%
Weighted average ROE (%) 1.11% 1.00% 0.11%
As at the end of the As at the end of last
+/- (%)
reporting period year
Total assets (RMB Yuan) 15,158,666,102.78 15,743,284,335.49 -3.71%
Net assets attributable to
shareholders of the Company (RMB 4,115,975,334.28 4,080,458,151.63 0.87%
Yuan)
II. 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 √ Inapplicable
No difference.
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2014 Semi-annual Report of Konka Group Co., Ltd.
2. Differences of net profit and net assets disclosed in financial reports prepared
under overseas and Chinese accounting standards
□ Applicable √ Inapplicable
No difference.
III. Items and amounts of extraordinary gains and losses
√Applicable □ Inapplicable
Unit: RMB Yuan
Item Amount Explanation
Gains/losses on the disposal of non-current assets
(including the offset part of asset impairment 259,145,561.57
provisions)
Government grants recognized in the current period,
except for those acquired in the ordinary course of
18,563,326.67
business or granted at certain quotas or amounts
according to the country’s unified standards
Gains and losses on change in fair value from tradable
financial assets and tradable financial liabilities,
as well as investment income from disposal of tradable
financial assets and tradable financial liabilities 48,104.52
and financial assets available for sales except for
effective hedging related with normal businesses of
the Company
Non-operating income and expenses other than the above 5,859,380.45
Less: Income tax effects 66,795,954.71
Minority interests effects (after tax) -473,271.65
Total 217,293,690.15 --
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 √ Inapplicable
No such cases during the reporting period.
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2014 Semi-annual Report of Konka Group Co., Ltd.
Section IV. Report of the Board of Directors
I. Overview
The Company specializes in production and operation of color TVs, digital mobile
phones, consumer appliances, set-top boxes, LED products as well as the supporting
products (such as molds, injection, packages, etc), and belongs to the industries
of electronics manufacture and telecommunication equipment manufacture.
In the reporting period, our internet oriented strategy produced initial results,
with the product structure improved and the sales proportion of intelligent TVs
increased to some extent.
However, affected by the drop in the sales volume and amount of color TVs, the sales
income of our color TVs registerred a certain decrease, leading to a certain decrease
in the main business income and profit in the reporting period.
For the reporting period, the Company achieved operating revenues of RMB 8.398
billion, down 10.86% over the same period of last year; net profit attributable to
shareholders of the Company of RMB 45.3601 million, up 11.87% on the year-on-year
basis; and EPS of RMB 0.0377/share.
II. Main business analysis
Overview
(I) In the reporting period, we focused on enhancing the internet oriented strategy,
with details as follows:
1. We unveiled the E-strategy to build an intelligent TV-Internet operation platform.
With high responsiveness and being always one among the first to notice the
development trends in the industry, we put forward to build the first intelligent
TV-Internet operation platform in China. We not only could deepen the intelligent
TV division to include content production and distribution platforms, but also were
likely to build the largest precision marketing platform of it to achieve maximum
value. Under this strategic goal, we put forward the strategic slogan of
“ E-dominance ” and unveiled the Group ’ s E-strategy for the first time. The
E-strategy consists of two cores—E-end and E-platform, the “1+1 Strategy” for
short. “E-end”refers to the extremely easy-to-use TV intelligent end, the household
internet control center. “E-platform” refers to the open and easily enjoyable
intelligent TV Internet operation. For Konka, E-end is the technical support and
hardware basis for E-platform; and E-platform is E-end in the aggregate, platform
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2014 Semi-annual Report of Konka Group Co., Ltd.
and internet forms. E-platform is the future of the Company, and the most important
product in the future.
Konka E-platform is a fully open platform for content and application suppliers in
the vertical direction and for counterparts in the horizontal direction. In the
vertical direction, E-platform is a platform of information renewal. Through
information exchange among users on E-platform, we can analyze and integrate data
and renew information to help explore new production functions, application contents
and business modes, which helps form an interest community of the up-and-down-stream
industries. In the horizontal direction, E-platform helps us study the big picture
of the TV industry and promotes the formulation of exchange standards in the industry.
In this way, it will grow into a more convenient, faster and stronger operation
platform, as well as the hub with the richest contents and applications and a highland
for added value.
In the reporting period, our internet oriented consciousness deepened. We initiated
a series of activities and explorations, our products began to show the internet
oriented trend and we became more internet oriented in the specific work.
2. The Company proactively searched for opportunities to strengthen foreign
corporation such as the Internet and application content.
The Company achieved strategic corporation with Youku Tudou Group and the latter
offered video software services for the Internet TV promoted by the Company and
implanted the function and service of Youku TV App into the full line of products
of the Company.
3. The Company launched the YI-TV best series and the YIUI professional TV control
system.
In the reporting period, we launched three best series of YI-TV 9800, YI-TV 6680
and YI-TV 1800, as well as the YIUI professional TV control system. As such, we
implemented the “1+1 Strategy” to attract consumer attention with better products
and use experience. The YIUI system is a professional TV control system designed
for intelligent TVs, making intelligent control easier, more direct and more
thorough.
(II) Influence of the R&D input, technical innovation and independent innovation
on the core competitiveness and the position in the industry in the reporting period
In the reporting period, the Company continued to enhance the R&D input and laid
a solid foundation for the implementation of product differentiation through
constantly developing new products, studying new techniques, altering the existing
equipment and enriching the product variety and series. Meanwhile, it continuously
carried out measures such as technical innovation and rational suggesting to
constantly increase the production efficiency and core competitiveness to maintain
the leading momentum in the industry.
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2014 Semi-annual Report of Konka Group Co., Ltd.
YoY change of major financial data:
Unit: RMB Yuan
Same period of last
Reporting period YoY +/-% Main reasons for change
year
The business volume of color
Operating revenues 8,398,300,541.63 9,421,399,281.00 -10.86%
TVs decreased.
The revenues decreased as the
Operating costs 7,010,567,842.76 7,835,777,505.69 -10.53% sales volume of color TVs
decreased.
Selling expenses 1,155,868,360.85 1,211,403,089.80 -4.58%
Administrative
304,442,442.38 312,936,108.52 -2.71%
expenses
The exchange loss on exchange
Financial expenses 101,860,777.24 -21,707,338.29 569.25%
rate fluctuations increased.
Income tax expenses 35,836,725.94 23,047,922.18 55.49%
R&D inputs 104,169,480.26 101,602,125.00 2.53%
Net cash flows from
operating 1,207,928,081.12 2,271,690,220.43 -46.83%
activities
Net cash flows from
investing -779,118,652.95 -68,371,493.46 -1039.54%
activities
Net cash flows from
financing -579,139,400.35 -1,272,989,661.59 54.51%
activities
Net increase in cash
and cash -139,437,747.49 945,263,306.86 -114.75%
equivalents
Major changes to the profit structure or sources of the Company during the reporting
period:
□ Applicable √ Inapplicable
In the reporting period, the color TV market encountered a fall, with a drop in both
of the sales volume and amount of color TVs. Meanwhile, new forces with internet
as the representative were shaking the whole structure of the color TV industry.
The shrinking sales of color TVs and the fierce competition among color TV makers
were bringing down the prices of color TVs. All these factors affected our sales
income and profit in the first half of the year, leading to some decrease in the
main business income and profit in the reporting period.
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2014 Semi-annual Report of Konka Group Co., Ltd.
Reporting period progress of the future development planning in the disclosed
documents of the Company such as share-soliciting prospectuses, offering
prospectuses, asset reorganization reports, etc.:
□ Applicable √ Inapplicable
The Company did not mention any future planning for the reporting period in its
disclosed documents such as share-soliciting prospectuses, offering prospectuses,
asset reorganization reports, etc.
Review the progress of any previously disclosed business plan in the reporting
period:
During the reporting period, adhering to the annual operational plan, the Company
overcame difficulties and steadily pushed forward all the operational and management
tasks. In the reporting period, our internet oriented strategy produced initial
results, with the product structure improved and the sales proportion of intelligent
TVs increased to some extent. However, affected by the drop in the sales volume and
amount of color TVs, the sales income of our color TVs registerred a certain decrease,
leading to a certain decrease in the main business income and profit in the reporting
period. For more progress, see “Overview” and “Main business analysis”.
III. Breakdown of main business
Unit: RMB Yuan
Increase/decr
Increase/decr Increase/decr
ease of
ease of ease of gross
Gross operating
Operating operating profit rate
Operating costs profit revenues over
revenues costs over the over the same
rate (%) the same
same period of period of last
period of last
last year (%) year (%)
year (%)
Classified by industry:
Electronic 8,291,111,451.15 6,955,006,042.75 16.11% -11.13% -10.64% -0.46%
Classified by product:
Color TVs 6,177,727,430.58 5,085,270,590.27 17.68% -17.39% -17.69% 0.30%
Cell
772,672,737.46 711,453,764.98 7.92% 12.54% 14.96% -1.94%
phones
Customer
790,777,396.77 635,004,533.66 19.70% 0.71% -4.63% 4.50%
appliances
Other 549,933,886.34 523,277,153.84 4.85% 45.03% 63.62% -10.80%
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2014 Semi-annual Report of Konka Group Co., Ltd.
Classified by region:
Domestic 5,926,481,822.65 4,776,277,966.87 19.41% -23.85% -24.36% 0.54%
Overseas 2,364,629,628.50 2,178,728,075.88 7.86% 52.92% 48.37% 2.82%
IV. Core competitiveness analysis
The Company’s capability in R&D, the marketing network and manufacture constitutes
its competitive edges. Through resource integration, the Company will vigorously
try to make substantial breakthroughs in intelligent products, cloud computing,
application of the internet technology, application software, etc.. It will also
try to enhance the strength and thickness of technical innovations to increase its
overall competitiveness.
V. Investment analysis
1. Investments in equities of external parties
(1) Investments in external parties
√ Applicable □ Inapplicable
Investments in external parties
Investment amount in the reporting Investment amount in the same
+/-%
period (RMB Yuan) period of last year (RMB Yuan)
7,723,300.00 0.00 -
Particulars about investees
Proportion of the Company’s
Name of investee Main business investment in the investee’s total
equity interests (%)
(2) Equity-holdings in financial enterprises
□ Applicable √ Inapplicable
There was no any equity-holding in financial enterprises of the Company at the
period-end.
(3) Securities investments
□ Applicable √ Inapplicable
There was no any securities investment of the Company at the period-end.
The Company held common shares of Vanke A at the end of the reporting period, with
the initial investment cost being RMB 2,311,748.07, the opening fair value being
RMB 941,999.30 and the closing fair value being RMB 970,153.70.
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2014 Semi-annual Report of Konka Group Co., Ltd.
2. Wealth management entrustment, derivative investments and entrustment loans
(1) Wealth management entrustment
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Relat
Actual
ed-pa Payme Impairm
Produ Amoun gain/l
rty nt Principal ent Predi
Name of Relat ct t Beginni Ending oss in
trans deter actually provisi cted
trustee ion varie entru ng date date report
actio minat recovered on (if gain
ty sted ing
n or ion any)
period
not
Guara
ntee
the
OCT
Naugh Finan 26 Jun. 30 Jun. princ
Branch No 20000 20,000.00 0 10.96
t cing 2014 2014 ipal
of ICBC
and
inter
est
Guara
ntee
the
Shahe
Naugh Finan 14 May. 14 Aug. princ 325.1
Branch No 30000 0 0 175.58
t cing 2014 2014 ipal 5
of BC
and
inter
est
Guara
ntee
the
OCT
Naugh Finan 4 Jun. 8 Jul. princ
Branch No 10000 0 0 43.78 35.25
t cing 2014 2014 ipal
of ABC
and
inter
est
368.9
Total 60000 -- -- -- 20,000.00 0 221.79
3
Source of the entrusted funds Self-owned funds of the Company
Cumulative overdue principals
0
and gains
16
2014 Semi-annual Report of Konka Group Co., Ltd.
Lawsuit (if applicable) Inapplicable
Disclosure date of the board
announcement approving the
24 May 2014
wealth management entrustment
(if any)
Disclosure date of the general
meeting announcement approving
Inapplicable
the wealth management
entrustment (if any)
(2) Derivative investment
□ Applicable √ Inapplicable
The Company did not carry out any derivative investment in the reporting period.
(3) Entrustment loans
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Related
Loan Intere Guarantor or Use of funds by
Borrower party
amount st rate pawn the borrower
or not
Anhui Konka Tongchuang Household Appliances Capital
No 30,000 6.00% Naught
Co., Ltd. turnover
Kunshan Kangsheng Investment Development Capital
No 24,500 6.00% Naught
Co., Ltd. turnover
Total -- 54,500 -- -- --
Expanded, overdued period or lawsuits events
Naught
(if any)
Solutions of expanded, overdued period or
Naught
lawsuits events (if any)
Disclosure date of the board announcement
approving the entrustment loans (if any)
Disclosure date of the general meeting
announcement approving the entrustment loans
(if any)
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2014 Semi-annual Report of Konka Group Co., Ltd.
3. Use of raised funds
(1) Overview of the use of raised funds
□ Applicable √ Inapplicable
(2) Projects invested with raised funds as promised
□ Applicable √ Inapplicable
(3) Change of raised-funds-invested projects
□ Applicable √ Inapplicable
No change of raised-funds-invested projects during the reporting period.
(4) Projects invested with raised funds
Overview of the project Disclosure date Index for the disclosed information
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2014 Semi-annual Report of Konka Group Co., Ltd.
4. Analysis to main subsidiaries and stock-participating companies
√ Applicable □ Inapplicable
Main subsidiaries and stock-participating companies:
Unit: RMB Yuan
Main
Company Registered Operating Operating
Company name Industry products/servi Total assets Net assets Net profit
variety capital revenues profit
ces
Production and
Shenzhen Konka sale of mobile
Telecommunications Subsidi Manufact communication
RMB 120000000 560,207,719.96 -176,385,664.05 790,460,043.45 5,392,202.01 9,371,186.42
Technology Co., ary ure products & sale
Ltd. of multimedia
products
Production and
Shenzhen Konka
Subsidi Manufact sale of digital -10,033,434.7
Information RMB 30000000 193,947,599.83 1,155,475.05 91,906,427.92 -7,658,298.64
ary ure network 9
Network Co., Ltd.
products
Anhui Konka Production and
Subsidi Manufact sale of 1,950,159,308. -12,025,687.2 -10,849,659.8
Electronic Co., RMB 140000000 444,969,610.57 269,191,090.56
ary ure multimedia 59 8 1
Ltd.
products
Production and
sale of
Anhui Konka
household
Household Subsidi Manufact
appliances such RMB 78190000 181,173,319.45 92,050,891.00 61,721,160.92 -3,515,433.32 -3,449,496.95
Appliances Co., ary ure
as
Ltd.
refrigerators
and washing
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2014 Semi-annual Report of Konka Group Co., Ltd.
machines
Production and
Kunshan Konka
Subsidi Manufact sale of TFT-LCM
Electronic Co., RMB 350000000 511,555,476.01 372,324,699.31 805,630,251.42 -7,861,450.59 -3,162,267.26
ary ure and multimedia
Ltd.
products
Production and
Dongguan Konka
Subsidi Manufact sale of
Electronic Co., RMB 266670000 690,343,207.28 342,149,011.62 166,786,755.84 -8,645,544.60 -5,406,875.19
ary ure multimedia
Ltd.
products
Production and
Dongguan Konka
Subsidi Manufact sale of mould
Mould Plastic Co., RMB 10000000 321,088,208.93 115,620,245.01 145,203,294.42 5,903,538.35 4,508,902.22
ary ure and plastic
Ltd.
products
Production and
Boluo Konka sale
Exactitude Science Subsidi Manufact high-density
RMB 15000000 112,223,184.37 -35,002,572.61 60,235,206.95 1,504,330.26 2,104,364.50
Technology Co., ary ure circuit board
Ltd. electronic
products
Export & impor
Internat
Hong Kong Konka Subsidi t of electrome 1,945,861,272. 1,456,455,339.
ional HKD 500000 128,982,416.11 19,193,637.55 16,017,538.95
Co., Ltd. ary chanical and e 22 79
trade
lectronics
Konka Household
Internat Import and
Appliances Subsidi 4,983,882,941. 1,933,736,321. -41,994,900.7 -41,994,900.7
ional export of HKD 500000 -10,841,226.86
International ary 54 45 8 8
trade electronics
Trading Co., Ltd.
Dongguan City Xu Subsidi Manufact Production and RMB 5000000 84,767,992.72 17,375,313.89 80,172,167.88 6,115,890.59 5,374,021.36
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2014 Semi-annual Report of Konka Group Co., Ltd.
Tongda Mould ary ure sale of mould
Plastic Co., Ltd. and plastic
products
Shenzhen Wankaida Development and
Software
Science and Subsidi maintenance of
developm RMB 10000000 248,929,413.49 239,601,154.32 64,035,770.00 50,441,658.80 53,393,011.43
Technology Co., ary software
ent
Ltd. technology
Kunshan Kangsheng
Development,
Investment Subsidi Real operation and -19,850,642.2
RMB 350000000 777,102,109.58 291,715,196.67 -8,428,044.85
Development Co., ary estate investment of 0
Ltd. real estate
Production and
Anhui Konka
sale of
Tongchuang refrigerators,
Subsidi Manufact
Household washing RMB 180000000 965,446,882.82 34,499,484.29 701,450,822.87 1,391,383.63 1,078,274.02
ary ure
Appliances Co., machines and
other household
Ltd.
appliances
EnRay Tek
Shareho
Optoelectronics Manufact Production and -19,218,131.7
lding USD 50000000 581,592,075.39 280,132,603.15 49,861,829.96 -3,204,359.66
(Shanghai) Co., ure sale of LED 7
company
Ltd.
Production and
Shanghai Konka Shareho
Manufact sale of light
Green Technology lding RMB 520000000 628,716,270.94 526,998,851.76 77,088,855.89 -7,634,188.44 -7,819,659.41
ure emitting diod
Co., Ltd. company
e
21
2014 Semi-annual Report of Konka Group Co., Ltd.
5. Significant projects invested with non-raised funds
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Cumulative
Input for actual input as Project Project
Project name Total investment
this period at the progress earnings
period-end
Estimated could
The Phase I
realize partly
residence had
Kunshan Shuiyue of the sales
200,000 5,268 69,247 basically
Zhouzhuang Project revenue in the
completed the
second half year
construction
of 2014
Total 200,000 5,268 69,247 -- --
Query date of the assigned website of
the disclosure of the temporary 6 Jul. 2010
announcement (if any)
Query index of the assigned website of
the disclosure of the temporary www.cninfo.com.cn
announcement (if any)
VI. Predict the operating results of Jan.-Sept. 2014
Warning of possible loss or considerable YoY change of the accumulated net profit
made during the period-begin to the end of the next reporting period according to
prediction, as well as explanations on the reasons:
□ Applicable √ Inapplicable
VII. Explanation by the Board of Directors and the Supervisory Committee about the
“non-standard audit report” issued by the CPAs firm for the reporting period
□ Applicable √ Inapplicable
VIII. Explanation by the Board of Directors about the “non-standard audit report”
for last year
□ Applicable √ Inapplicable
IX. Implementation of profit allocation during the reporting period
Profit allocation plan implemented during the reporting period, especially execution
and adjustment of the cash dividend plan and the plan for turning capital reserve
into share capital:
22
2014 Semi-annual Report of Konka Group Co., Ltd.
√ Applicable □ Inapplicable
As reviewed at the 2013 Annual Shareholders’ General Meeting, the profit allocation
plan for 2013 was decided as follows:
Dividend distribution plan: Based on the Company ’ s total share capital of
1,203,972,704 shares as at the end of 2013, the Company distributed a cash dividend
of RMB 0.1 (tax included) to every 10 shares. The distributed profits aggregated
RMB 12,039,727.04 and the retained profit was carried forward into the next year
for distribution.
The profit allocation plan has been carried out. For A-shares, the date of record
was 28 May 2014 and the ex-dividend date was 29 May 2014; for B-shares, the last
trading date was 28 May 2014, the ex-dividend date was 29 May 2014 and the date of
record was 3 Jun. 2014.
Special statement about the cash dividend policy
In compliance with the Company’s Articles of Association
Yes
and the resolution of the general meeting
Specific and clear dividend standard and ratio Yes
Complete decision-making procedure and mechanism Yes
Independent directors fulfilled their responsibilities
Yes
and played their due role.
Minority shareholders have the chance to fully express
their opinion and desire and their legal rights and Yes
interests were fully protected.
In adjustment or alteration of the cash dividend policy,
the conditions and procedure were in compliance with Yes
regulations and transparent.
X. Preplan for profit distribution and turning capital reserve into share capital
for the reporting period
□ Applicable √ Inapplicable
The Company planed not to distribute cash dividends or bonus shares or turn capital
reserve into share capital for the reporting period.
XI. Researches, visits and interviews received in the reporting period
□ Applicable √ Inapplicable
The Company was not involved in any activity of researches, visits and interviews
in the reporting period.
23
2014 Semi-annual Report of Konka Group Co., Ltd.
Section V. Significant Events
I. Corporate governance
In the reporting period, in strict compliance with the Company Law, the Securities
Law and other relevant laws, regulations and rules governing corporate governance
of listed companies, as well as the Company’s Articles of Association, the Company
kept optimizing its corporate governance structure, promoted compliance with
applicable laws and regulations in its operation, and performed the information
disclosure duty strictly in accordance with the Stock Listing Rules of the Shenzhen
Stock Exchange. All directors, supervisors and senior executives of the Company
performed their duties diligently. The Shareholders’ General Meeting, the Board
of Directors and the Supervisory Committee all operated in compliance with relevant
laws and regulations. The Company’s existing internal control rules played the role
of supervision, control and guidance effectively in its production and operation.
Independence and transparency of the Company, together with a professional board
of directors, ensured that every decision of the Company was made in a scientific
procedure. The actual situation of the Company’s governance was in compliance with
the Company Law and the relevant CSRC requirements.
II. Significant lawsuits or arbitrations
√ Applicable □ Inapplicable
Amount
involved Enforcement
Progress
Basic in the Forming the Trial result on the
of the
information of lawsuit estimated and influence judgment of Disclosur Disclosur
lawsuit
the lawsuit (arbitrat liabilities of the lawsuit the lawsuit e date e index
(arbitra
(arbitration) ion) (RMB or not? (arbitration) (arbitratio
tion)
Ten n)
thousand)
For the Announcem
newest ent on the
progres Results of
Arbitration
s, Significa
events of
please nt
“Whether
refer For the Arbitrati
Konka Group
to the arbitration on, with
has the right
Announc results, Being 2 Aug. the
to be the Unknown No
ement please refer executing 2014 announcem
unique
on to the ent No.:
development
Signifi announcement 2014-39,
subject of the
cant and the
city renewal
Arbitra disclosin
project”
tion g website:
disclos www.cninf
ed on 2 o.com.cn
24
2014 Semi-annual Report of Konka Group Co., Ltd.
Aug.
2014.
III. Media’s queries
□Applicable √Inapplicable
There was no media’s common query during the reporting period.
IV. Bankruptcy reorganization
□ Applicable √ Inapplicable
No event involving bankruptcy reorganization occurred to the Company in the reporting
period.
V. Asset transactions
1. Purchase of assets
□ Applicable √ Inapplicable
There was no purchase of assets by the Company during the reporting period.
2. Sale of assets
√ Applicable □ Inapplicable
Net Ratio Relat
profi of ionsh
Wheth
t the ip
er or Wheth
contr net betwe
not er or
ibute profi en not
Influ the
d by t the the
Trans ence owner credi
the contr trans
actio of Relat ship tor’s
asset ibute actio right
n the ed-pa of
Trans from d to Prici n and
Date price sale rty the liabi Discl Discl
actio Asset the the ng party
of (RMB on trans asset litie osure osure
n sold perio Compa princ and s
sale Ten the actio invol date index
party d-beg ny by iple the invol
thous Compa n or ved ved
in to the Compa
and ny not has have
the asset ny been
Yuan) (note been
date sale (appl fully
3) fully trans
of to icabl
trans ferre
sale the e for d
ferre
(RMB total relat
d
Ten profi ed-pa
thous t (%) rty
25
2014 Semi-annual Report of Konka Group Co., Ltd.
and trans
Yuan) actio
ns)
Annou
nceme
nt on
the
Progr
ess
The
of
selli
trans
ng of
ferri
the
ng
equit
100%
y
equit
mainl
100% ies
y was
equit OTC of
the
ies Group Shenz
dispo
of Compa hen
sal
Shenz ny Konka
of
hen was Video
idle
Konka the &
OTC asset
Video 23 Asses contr 26 Commu
Group 24,76 s,
& Jun. sment Yes ollin Yes Yes Jun. nicat
Compa 8.78 funds
Commu 2014 price g 2014 ion
ny recov
nicat share Syste
ery,
ion holde ms
which
Syste r of Engin
were
ms the eerin
for
Engin Compa g
stren
eerin ny Co.,
gthen
g Co. with
the
the
mobil
annou
ity
nceme
of
nt
the
No:
capit
2014-
al.
34
and
the
discl
osing
websi
26
2014 Semi-annual Report of Konka Group Co., Ltd.
te:
www.c
ninfo
.com.
cn
27
2014 Semi-annual Report of Konka Group Co., Ltd.
3. Business combination
□ Applicable √ Inapplicable
No business combination occurred to the Company during the reporting period.
VI. Implementation of equity incentive and its influence
□ Applicable √ Inapplicable
The Company did not make or carry out any equity incentive plan during the reporting
period.
VII. Significant related-party transactions
1. Related-party transactions concerning routine operation
√ Applicable □ Inapplicable
Proport
Obtain
ion in
able
the
market
Type Transact total
Relate price
of Content Prici Trans ion amounts Method
d for Disclo Disclo
Relati the s of the ng actio amount of of
transa the sure sure
on trans transac princ n (RMB Ten transac settle
ction transa date index
actio tion iple price thousand tions ment
party ction
n Yuan) of the
of the
same
same
kind
kind
(%)
Anhui Under Purch
the ase Purchas
Huali Negot Marke www.cn
same of e of 4 Apr.
Packin iated t 1,526.24 0.32% Cash info.c
actual commo materia 2014
g Co., price price om.cn
contro ditie ls
Ltd.
ller s
Shangh
Under Purch
ai the ase Purchas
Negot Marke www.cn
Huali same of e of 4 Apr.
iated t 582.27 0.10% Cash info.c
Packin actual commo materia 2014
price price om.cn
g Co., contro ditie ls
Ltd. ller s
Huali
Packin Under Purch
the ase Purchas
g Negot Marke www.cn
same of e of 4 Apr.
(Huizh iated t 717.34 0.12% Cash info.c
actual commo materia 2014
ou) price price om.cn
contro ditie ls
Co.,
ller s
Ltd.
OCT Under Purch Purchas Negot Marke 332.16 0.07% Cash 4 Apr. www.cn
28
2014 Semi-annual Report of Konka Group Co., Ltd.
Water the ase e of iated t 2014 info.c
& same of water & price price om.cn
Electr actual commo electri
contro ditie
icity city
ller s
Compan
y
Shenzh Under Purch
en OCT the ase Purchas
Negot Marke www.cn
Hotel same of e of 4 Apr.
iated t 16.47 0.01% Cash info.c
Group actual commo materia 2014
price price om.cn
Co., contro ditie ls
Ltd. ller s
Under
Shenzh Sales
the Negot Marke www.cn
en OCT of
same Sales 4 Apr.
East commo iated t 37.18 0.80% Cash info.c
actual of LCD 2014
Co., ditie price price om.cn
contro
Ltd s
ller
Shangh
ai
Highpo Under
Sales
wer the Negot Marke www.cn
of
same Sales 4 Apr.
OCT commo iated t 1.07 0.02% Cash info.c
actual of LCD 2014
Invest ditie price price om.cn
contro
ment s
ller
Co.,
Ltd.
Yunnan
Under
OCT Sales
the Negot Marke www.cn
of
Indust same Sales 4 Apr.
commo iated t 1.28 0.02% Cash info.c
rial actual of LCD 2014
ditie price price om.cn
Co., contro
s
Ltd. ller
Total -- -- 3,214.01 -- -- -- -- --
Details of large amount of sales
Inapplicable
returns
The Company has published the Forecasting Public Notice on Routine Related
As for the prediction on the total Transaction for Y2014 (public notice No. 2014-11) on Securities Times,
amount of routine related-party Shanghai Securities News, China Securities Journal and Hong Kong Ta Kung
transactions to be occurred in the Pao as well as the Internet website designated by CSRC
reporting period by relevant http://www.cninfo.com.cn on 4 Apr. 2014. In the reporting period, the
types, the actual performance in basis for pricing, transaction price, transaction amount and settlement
the reporting period (if any) methods of raw materials purchased by the Company were basically in
accordance with the forecast. The total amount was RMB 32,140,100 Yuan.
29
2014 Semi-annual Report of Konka Group Co., Ltd.
Reason for significant difference
The transaction price was fixed by referring to the market price, which
between the transaction price and
had not any significant difference with the market price.
the market price
2. Related-party transactions arising from acquisition and sale of assets
√ Applicable □ Inapplicable
Asses
Book
sed
value
value
of the Marke Trans
of the Gain/
Relat Conte trans t fair fer
Type trans loss
ed nts of Prici ferre value price Mode
of the ferre (RMB Discl Discl
trans Relat the ng d (RMB (RMB of
trans d Ten osure osure
actio ion trans princ asset Ten Ten settl
actio asset thous date index
n actio iple (RMB thous thous ement
n (RMB and
party n Ten and and
Ten Yuan)
thous Yuan) Yuan)
thous
and
and
Yuan)
Yuan)
Annou
Trans nceme
ferri nt on
ng the
100% Progr
equit ess of
ies of trans
Shenz ferri
Contr Relat hen ng
ollin ed-tr Konka 100%
g ansac Video equit
OTC
share tion & Asses 26 ies of
Group -1,46 24,76 24,76 24,76 26,23
holde of Commu sment Cash Jun. Shenz
Compa 4.31 8.78 8.78 8.78 3.09
r of sales nicat price 2014 hen
ny
the of ion Konka
Compa asset Syste Video
ny s ms &
Engin Commu
eerin nicat
g Co. ion
held Syste
by the ms
Compa Engin
ny eerin
g Co.,
30
2014 Semi-annual Report of Konka Group Co., Ltd.
with
the
annou
nceme
nt No:
2014-
34 and
the
discl
osing
websi
te:
www.c
ninfo
.com.
cn
3. Related-party transactions arising from joint investment in external parties
□ Applicable √ Inapplicable
No related-party transaction arising from joint investment in external parties
occurred to the Company during the reporting period.
4. Credits and liabilities with related parties
√ Applicable □ Inapplicable
Was there any non-operating credit or liability with any related party?
□ Yes √ No
The Company was not involved in any non-operating credit or liability with any related
party during the reporting period.
5. Other significant related-party transactions
√ Applicable □ Inapplicable
In order to meet the development of the existing business capital need and reduce
fund cost, the Company reviewed and approved the Proposal on Borrowing Loans from
OCT ENTERPRISES CO on the 55th Session of the 7th Board of Directors, which agreed
the Company to apply on increasing a line of loans not over RMB 3 billion from OCT
ENTERPRISES CO. The balance of the line of loan was not over 150 million at any time.
According to the market condition, the interest rate of the aforesaid loans was lower
than the interest rate of other financial institution loans in the same period. In
predict the corresponding interest rate amount of this year and the aforesaid line
of loans was not over RMB 90 million.
Index for the interim reports on significant related-party transactions disclosed
31
2014 Semi-annual Report of Konka Group Co., Ltd.
on the relevant website
Title of the interim announcement Disclosure date Disclosure website
Announcement on Related-party
4 Apr. 2014 www. cninfo.com.cn
Transaction
VIII. Occupation of the Company ’ s funds for non-operating purposes by the
controlling shareholder and its related parties
□ Applicable √ Inapplicable
The controlling shareholder or its related parties did not occupy the Company’s
funds for non-operating purposes during the reporting period.
IX. Significant contracts and fulfillment thereof
1. Trusteeship, contracting and leasing
(1) Trusteeship
□ Applicable √ Inapplicable
The Company did not make any entrustment in the reporting period.
(2) Contracting
□ Applicable √ Inapplicable
The Company was not involved in any contracting in the reporting period.
(3) Leasing
√ Applicable □ Inapplicable
Particulars about lease
The Company’s Research and Development Building is rent with annual income of RMB
53,101,300 in the first half of 2014. In the reporting period, the profit and loss
accounts of single lease contract were not more than 10% of total profits.
Any leasing event incurring gain/loss reaching more than 10% of the total profits
of the Company in the reporting period
□ Applicable √ Inapplicable
No leasing event incurred gain/loss reaching more than 10% of the total profits of
the Company in the reporting period.
2. Guarantees provided by the Company
Unit: RMB Ten Thousand Yuan
Guarantees provided by the company for external parties (excluding those for subsidiaries)
Disclosu
Guaran
re date Actual
Amount tee
on occurrence Actual Period of Execut
Guaranteed for Type of for a
relevant date (date guarantee guarante ed or
party guarant guarantee relate
announce of amount e not
ee d
ment of agreement)
party
guarante
32
2014 Semi-annual Report of Konka Group Co., Ltd.
ed or not
amount
Dongguan Konka Joint
27 Apr.
Mould Plastic 4,631 1 Feb. 2014 1,389.3 liability 6 months No No
2013
Co., Ltd. guaranty
Kunshan
Joint
Jielunte Mould 29 Sep.
23,155 1 Jan. 2014 463.1 liability 5 years No No
Plastic Co., 2013
guaranty
Ltd.
Joint
Anhui Konka E
2750 18 Sep. 2013 2750 liability 3 years No No
lectronic
guaranty
Total actual occurred
Total external guarantee
amount of external
line approved during the 0 1,852.4
guarantee during the
reporting period (A1)
reporting period (A2)
Total external guarantee Total actual external
line that has been approved guarantee balance at the
30,536 4,602.40
at the end of the reporting end of the reporting
period (A3) period (A4)
Guarantees provided by the Company for its subsidiaries
Disclosu
re date Guaran
of Actual tee
Amount
relevant occurrence Actual Period of Execut for a
Guaranteed for Type of
announce date (date guarantee guarante ed or relate
party guarante guarantee
ment on of amount e not d
e
the agreement) party
guarante or not
e amount
Shenzhen Konka
Joint
Communication 13 Dec.
80,000 8 Dec. 2013 80,000 liability 1 year No No
technology Co., 2011
guaranty
Ltd.
Anhui Konka
Tongchuang Joint
2 Jun.
Household 41,000 29 Jun. 2013 18,500 liability 1 year No No
2012
Appliances Co., guaranty
Ltd.
Hong Kong Konka 1 Jan. Total Joint
14 Mar. 2013 29,140 2 years No No
Co., Ltd. 2012 amount liability
33
2014 Semi-annual Report of Konka Group Co., Ltd.
of RMB guaranty
186,000 Joint
Hong Kong Konka 13 Dec.
25 Mar. 2013 8,742 liability 2 years No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec
19 Jul. 2013 5,580 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
19 Jul. 2013 5,877.6 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
23 Jul. 2013 6,200 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
26 Aug. 2013 12,400 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
26 Sep. 2013 30,287 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
8 Jan. 2014 7,533 liability 1 year No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
15 Jan. 2014 30,070 liability 2 years No No
Co., Ltd. 2011
guaranty
Joint
Hong Kong Konka 13 Dec.
17 Mar. 2014 5,886.19 liability 1 year No No
Co., Ltd. 2011
guaranty
Konka Household
Appliances Joint
13 Dec.
International 16 Jan. 2014 4,340 liability 1 year No No
2011
Trading Co., guaranty
Ltd.
Konka Household
Appliances Joint
13 Dec.
International 6 Mar. 2014 2,790 liability 1 year No No
2011
Trading Co., guaranty
Ltd.
Konka Household Joint
13 Dec.
Appliances 27 May 2014 17,670 liability 0.5 year No No
2011
International guaranty
34
2014 Semi-annual Report of Konka Group Co., Ltd.
Trading Co.,
Ltd.
Total guarantee line Total actual occurred
approved for the amount of guarantee for
subsidiaries during the 0 the subsidiaries during 68,289.19
reporting period the reporting period
(B1) (B2)
Total actual guarantee
Total guarantee line that
balance for the
has been approved for the
549,474 subsidiaries at the end 265,015.79
subsidiaries at the end of
of the reporting period
the reporting period (B3)
(B4)
Total guarantee amount provided by the Company (total of the above-mentioned two kinds of guarantees)
Total actual occurred
Total guarantee line
amount of guarantee
approved during the 0 70,141.59
during the reporting
reporting period (A1+B1)
period (A2+B2)
Total guarantee line that Total actual guarantee
has been approved at the end balance at the end of the
580,010 269,618.19
of the reporting period reporting period
(A3+B3) (A4+B4)
Proportion of total guarantee amount (A4+B4) to the
65.51%
net assets of the Company
Of which:
Amount of guarantee for shareholders, actual
0
controller and related parties (C)
Amount of debt guarantee provided for the guaranteed
party whose asset-liability ratio is not less than 265,015.79
70% directly or indirectly (D)
Part of the amount of the total guarantee over 50%
63,819.42
of net assets (E)
Total amount of the above three guarantees (C+D+E) 328,835.21
Explanation on possible bearing joint responsibility
Inapplicable
of liquidation due to immature guarantee (if any)
Explanation on provision of guarantees for external
parties in violation of the prescribed procedure (if Inapplicable
any)
Explanation on guarantee that adopts complex method
There was no any guarantee that adopted complex method of the Company during the
reporting period.
35
2014 Semi-annual Report of Konka Group Co., Ltd.
(1) Illegal provision of guarantees for external parties
□ Applicable √ Inapplicable
The Company did not illegally provide any guarantee for any external party in the
reporting period.
3. Other significant contracts
□ Applicable √ Inapplicable
There was no other significant contract of the Company in the reporting period.
4. Other significant transactions
□ Applicable √ Inapplicable
The Company was not involved in any other significant transaction in the reporting
period.
X. Commitments made by the Company or any shareholder holding over 5% of the Company’
s shares in the reporting period or such commitments carried down into the reporting
period
□ Applicable √ Inapplicable
No such commitments in the reporting period.
XI. Engagement and disengagement of the CPAs firm
Has the semi-annual financial report been audited?
□ Yes √ No
XII. Punishments and rectifications
□ Applicable √ Inapplicable
No punishment or rectification in the reporting period.
XIII. Delisting risk due to violation of laws or regulations
□ Applicable √ Inapplicable
No such risk in the reporting period.
XIV. Other significant events
√ Applicable □ Inapplicable
Index for information disclosure of the first half year of 2014:
Link
No. Time Name of announcement Page
www.cninfo.com.cn
Y2014
Announcement of solutions Securities Times
th th
http://www.cninfo.com.cn/finalpage/2014-
2014-01 2014/1/3 of the 55 Session of the 7 B52, Ta Kung Pao
01-03/63442676.PDF
Board of Directors B2
Announcement on the
Securities Times http://www.cninfo.com.cn/finalpage/2014-
2014-02 2014/1/11 Resignation of Vice
B1, Ta Kung Pao B5 01-11/63473432.PDF
President
2014-03 2014/3/1 Announcement of solutions Securities Times http://www.cninfo.com.cn/finalpage/2014-
36
2014 Semi-annual Report of Konka Group Co., Ltd.
rd th
of the 53 Session of the 7 B25, Ta Kung Pao 03-01/63620067.PDF
Board of Directors B5
Securities Times
Announcement on Significant http://www.cninfo.com.cn/finalpage/2014-
2014-04 2014/3/1 B25, Ta Kung Pao
Arbitration 03-01/63620918.PDF
B5
Announcement of solutions Securities Times
th th
http://www.cninfo.com.cn/finalpage/2014-
2014-05 2014/3/7 of the 54 Session of the 7 B16, Ta Kung Pao
03-07/63645662.PDF
Board of Directors B10
Announcement on the
Securities Times
Progress of the Declaration http://www.cninfo.com.cn/finalpage/2014-
2014-06 2014/3/7 B16, Ta Kung Pao
of the Urban Renewal Plan 03-07/63645661.PDF
B10
Project
Securities Times
Announcement on Receipt of http://www.cninfo.com.cn/finalpage/2014-
2014-07 2014/3/27 B44, Ta Kung Pao
Tax Rebates 03-27/63730510.PDF
B3
Announcement of solutions Securities Times
th th
http://www.cninfo.com.cn/finalpage/2014-
2014-08 2014/4/4 of the 11 Session of the 7 B60, Ta Kung Pao
04-04/63788608.PDF
Board of Supervisors B16
Announcement on Authorizing
the Management Level of the Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-09 2014/4/4 Company to Sell the Shares B60, Ta Kung Pao
04-04/63788621.PDF
of the Participated Company B16
by Choosing the Time
Securities Times
Announcement on Related http://www.cninfo.com.cn/finalpage/2014-
2014-10 2014/4/4 B60, Ta Kung Pao
Party Transaction 04-04/63788626.PDF
B16
Forecasting Public Notice Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-11 2014/4/4 on Routine Related B60, Ta Kung Pao
04-04/63788553.PDF
Transaction for Y2014 B16
Securities Times
Abstract of the Annual http://www.cninfo.com.cn/finalpage/2014-
2014-12 2014/4/4 B60, Ta Kung Pao
Report for Y2013 04-04/63788554.PDF
B16
Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-13 2014/4/4 Annual Report for Y2013 B60, Ta Kung Pao
04-04/63788613.PDF
B16
Securities Times
Notice on Holding the 2013 http://www.cninfo.com.cn/finalpage/2014-
2014-14 2014/4/4 B60, Ta Kung Pao
Annual General Meeting 04-04/63788592.PDF
B16
th
Announcement on the 55 Securities Times
th
http://www.cninfo.com.cn/finalpage/2014-
2014-15 2014/4/4 Session of the 7 Board of B60, Ta Kung Pao
04-04/63788591.PDF
Directors B16
Announcement on the Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-16 2014/4/9 Progress of Significant B12, Ta Kung Pao
04-09/63805353.PDF
Arbitration Events A21
37
2014 Semi-annual Report of Konka Group Co., Ltd.
Securities Times
Text of 2014 First Quarter http://www.cninfo.com.cn/finalpage/2014-
2014-17 2014/4/15 B76, Ta Kung Pao
Report 04-15/63837774.PDF
B12
Securities Times
Text of 2014 First Quarter http://www.cninfo.com.cn/finalpage/2014-
2014-18 2014/4/15 B76, Ta Kung Pao
Report 04-15/63837778.PDF
B12
Announcement on the Changes
Securities Times
in the Dicastery of http://www.cninfo.com.cn/finalpage/2014-
2014-19 2014/4/16 B37, Ta Kung Pao
Significant Arbitration 04-16/63844382.PDF
B14
Events
Announcement on the Second
Securities Times
Session of Trial of http://www.cninfo.com.cn/finalpage/2014-
2014-20 2014/4/22 B29, Ta Kung Pao
Significant Arbitration 04-22/63884605.PDF
B9
Events
Announcement on Solutions Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-21 2014/4/26 of the 2013 Annual General B20, Ta Kung Pao
04-26/63924031.PDF
Meeting B7
Announcement on the Third
Securities Times
Session of Trial of http://www.cninfo.com.cn/finalpage/2014-
2014-22 2014/5/6 B32, Ta Kung Pao
Significant Arbitration 05-06/63970668.PDF
B15
Events
Announcement on the Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-23 2014/5/22 Implementation of the 2013 B33, Ta Kung Pao
05-22/64052436.PDF
Annual Dividend Plan B3
th
Announcement on the 57 Securities Times
th
http://www.cninfo.com.cn/finalpage/2014-
2014-24 2014/5/24 Session of the 7 Board of B40, Ta Kung Pao
05-24/64059687.PDF
Directors B12
Announcement on Purchasing Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-25 2014/5/24 Principal-guaranteed Bank B40, Ta Kung Pao
05-24/64059682.PDF
financial products B12
Notice on Holding the 2014 Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-26 2014/5/24 First Extraordinary General B40, Ta Kung Pao
05-24/64059681.PDF
Meeting B12
Announcement on Using the
Securities Times
Financial Instruments for http://www.cninfo.com.cn/finalpage/2014-
2014-27 2014/5/24 B40, Ta Kung Pao
Locking the USD Financing 05-24/64059684.PDF
B12
Cost
Announcement on
Transferring 100% Equities
of Shenzhen Konka Video & Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-28 2014/5/24 Communication Systems B40, Ta Kung Pao
05-24/64059683.PDF
Engineering Co. (After B12
Stripping off Partly Asset
Liabilities) and the
38
2014 Semi-annual Report of Konka Group Co., Ltd.
Related-transactions
Securities Times
Announcement on the http://www.cninfo.com.cn/finalpage/2014-
2014-29 2014/5/27 B25, Ta Kung Pao
Resignation of the CFO 05-27/64067762.PDF
B11
Announcement on the Securities Times
th
http://www.cninfo.com.cn/finalpage/2014-
2014-30 2014/5/28 Solutions of the 58 Session B28, Ta Kung Pao
th
05-28/64072795.PDF
of the 7 Board of Directors B16
Indicative Announcement on
Securities Times
Holding the 2014 First http://www.cninfo.com.cn/finalpage/2014-
2014-31 2014/5/30 B61, Ta Kung Pao
Extraordinary General 05-30/64081579.PDF
B21
Meeting
Announcement on the
Securities Times
Solutions of the 2014 First http://www.cninfo.com.cn/finalpage/2014-
2014-32 2014/6/10 B61, Ta Kung Pao
Extraordinary General 06-10/64119389.PDF
A19
Meeting
Announcement on the Fourth
Securities Times
Session of Trial of http://www.cninfo.com.cn/finalpage/2014-
2014-33 2014/6/12 B41, Ta Kung Pao
Significant Arbitration 06-12/64127660.PDF
B21
Events
Announcement on the
Progress of Transferring Securities Times
http://www.cninfo.com.cn/finalpage/2014-
2014-34 2014/6/26 100% Equities of Shenzhen B53, Ta Kung Pao
06-26/1200006958.PDF
Konka Video & Communication B3
Systems Engineering Co.
39
2014 Semi-annual Report of Konka Group Co., Ltd.
Section VI. Change in Shares & Shareholders
I. Change in shares
Unit: Share
Before the change Increase/decrease (+, -) After the change
Capita
lizati
on of
Percen New Bonus Subtot Percen
Number capita Other Number
tage shares shares al tage
l
reserv
e
I. Shares subject to
198,38 198,38
trading 16.48% 16.48%
1,940 1,940
trading moratorium
2. Shares held by
198,38 198,38
state-owned 16.48% 16.48%
1,940 1,940
corporation
II. Shares not 1,005, 1,005,
subject to trading 590,76 83.52% 590,76 83.52%
moratorium 4 4
1. RMB ordinary 599,91 599,91
49.83% 49.83%
shares 4,960 4,960
2. Domestically 405,67 405,67
33.69% 33.69%
listed foreign shares 5,804 5,804
1,203, 1,203,
100.00 100.00
III. Total shares 972,70 972,70
% %
4 4
Reasons for changes in shares
□ Applicable √ Inapplicable
Approval of share changes
□ Applicable √ Inapplicable
Transfer of share ownership
□ Applicable √ Inapplicable
Effects of changes in shares on the basic EPS, diluted EPS, net assets per share
attributable to common shareholders of the Company and other financial indexes over
the last year and the last reporting period
40
2014 Semi-annual Report of Konka Group Co., Ltd.
□ Applicable √ Inapplicable
Other contents that the Company considers necessary or is required by the securities
regulatory authorities to disclose
□ Applicable √ Inapplicable
Change of the total shares, shareholder structure, asset structure and liability
structure
□ Applicable √ Inapplicable
II. Total number of shareholders and their shareholdings
Unit: Share
Total number of preferred
share holders who had
Total number of common
resumed their voting
shareholders at the end of 82,786 0
right at the end of the
the reporting period
reporting period (if any)
(see note 8)
Shareholdings of shareholders holding more than 5% shares or top 10 shareholders
Increa Pledged or frozen
se/dec shares
Number of rease Number Number
Sharehold shares held of of of
Name of Nature of ing at the end shares restric non-res
Number
shareholder shareholder percentag of the during ted tricted Status of
of
e (%) reporting the shares shares shares
shares
period report held held
ing
period
OCT 2,142, 198,381 32,515, Pledged 0
State-owned
ENTERPRISES 19.18% 230,897,597
corporation 814 ,940 657 Frozen 0
CO.
HOLY TIME Foreign -13,12 45,786, Pledged Unknown
3.80% 45,786,241 0
GROUP LIMITED corporation 0,659 241 Frozen Unknown
GAOLING Foreign 26,400, Pledged Unknown
2.19% 26,400,625 0 0
FUND,L.P. corporation 625 Frozen Unknown
China Pledged Unknown
Resources SCP
Domestic
Trust Co., 23,238 23,238,
non-state-owne 1.93% 23,238,965 0
Ltd.－ ,965 965 Frozen Unknown
d corporation
Extraordinar
y No. 18
41
2014 Semi-annual Report of Konka Group Co., Ltd.
Capital Trust
Guoyuan Pledged Unknown
Securities Foreign 14,114 14,114,
1.17% 14,114,500 0
Broker (HK) corporation ,500 500
Frozen Unknown
Co., Ltd.
Domestic -362,5 14,093, Pledged Unknown
Sun Zhenxiang 1.17% 14,093,988 0
individual 00 988 Frozen Unknown
Foreign -70,00 11,690, Pledged Unknown
NAM NGAI 0.97% 11,690,520 0
individual 0 520 Frozen Unknown
Domestic 285,70 5,733,0 Pledged Unknown
Li Yichao 0.48% 5,733,081 0
individual 0 81 Frozen Unknown
Ping An Domestic Pledged Unknown
5,547, 5,547,3
Securities non-state-owne 0.46% 5,547,339 0
339 39 Frozen Unknown
Co., Ltd. d corporation
Domestic 5,006,5 Pledged Unknown
Xia Rui 0.42% 5,006,500 0 0
individual 00 Frozen Unknown
Strategic investor or general
corporation becoming a top ten
Naught
shareholder due to placing of
new shares (if any)
The first majority shareholder OVERSEAS CHINESE TOWN ENTERPRISES CO. has
Explanation on associated
no related-party relationship with other shareholders and they are not
relationship or/and persons
acting-in-concert parties, either. Except for that, the Company does not
acting in concert among the
know whether the other shareholders are related parties and whether they
above-mentioned shareholders:
are acting-in-concert parties.
Particulars about shares held by the top ten shareholders holding shares not subject to trading moratorium
Number of tradable shares held at the Type of shares
Name of shareholder
period-end Type Number
Domestically
listed
HOLY TIME GROUP LIMITED 45,786,241 45,786,241
foreign
shares
RMB ordinary
OCT ENTERPRISES CO. 32,515,657 32,515,657
share
Domestically
GAOLING FUND,L.P. 26,400,625 26,400,625
listed
42
2014 Semi-annual Report of Konka Group Co., Ltd.
foreign
shares
China Resources SCP Trust Co.,
RMB ordinary
Ltd.－Extraordinary No. 18 23,238,965 23,238,965
share
Capital Trust
Domestically
Guoyuan Securities Broker (HK) listed
14,114,500 14,114,500
Co., Ltd. foreign
shares
RMB ordinary
Sun Zhenxiang 14,093,988 14,093,988
share
Domestically
listed
NAM NGAI 11,690,520 11,690,520
foreign
shares
RMB ordinary
Li Yichao 5,733,081 5,733,081
share
RMB ordinary
Ping An Securities Co., Ltd. 5,547,339 5,547,339
share
RMB ordinary
Xia Rui 5,006,500 5,006,500
share
Explanation on associated
relationship or/and persons The first majority shareholder OVERSEAS CHINESE TOWN ENTERPRISES CO. has
acting in concert among the top no related-party relationship with other shareholders and they are not
ten tradable shareholders and acting-in-concert parties, either. Except for that, the Company does not
between the top ten tradable know whether the other shareholders are related parties and whether they
shareholders and the top ten are acting-in-concert parties.
shareholders
Explanation on the Top 10
shareholders participating in Sun Zhenxiang holds 14,093,988 A-shares through a client credit trading
the margin trading business (if guarantee securities account of GF Securities Co., Ltd.
any)(see notes 4)
Whether the shareholders of the Company in the trade agreement to buy back during
the reporting period
□ Yes √ No
There was no such deal of the Company during the reporting period.
Notes: according to the Report of Changes in Detailed Equity disclosed on 26 Jul.2014
by OVERSEAS CHINESE TOWN ENTERPRISES CO., up to 25 Jul. 2014, the 240,851,744 shares
of Shenzhen Konka A （000016） held by OVERSEAS CHINESE TOWN ENTERPRISES CO. was
of 20% of the equities of the Company.
III. Change of the controlling shareholder or the actual controller
43
2014 Semi-annual Report of Konka Group Co., Ltd.
Change of the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
The controlling shareholder of the Company did not change in the reporting period.
Change of the actual controller in the reporting period
□ Applicable √ Inapplicable
The actual controller of the Company did not change in the reporting period.
IV. Any shareholding increase plan proposed or implemented by any shareholder or
its act-in-concert party during the reporting period
□ Applicable √ Inapplicable
To the best knowledge of the Company, no shareholder or its act-in-concert party
proposed or implemented any shareholding increase plan during the reporting period.
44
2014 Semi-annual Report of Konka Group Co., Ltd.
Section VII. Preferred Shares
I. Issuance and listing of preferred shares in the reporting period
□ Applicable √ Inapplicable
II. Number of preferred share holder and their shareholdings
□ Applicable √ Inapplicable
III. Buy-back or conversion of preferred shares
1. Buy-back of preferred shares
□ Applicable √ Inapplicable
2. Conversion of preferred shares
□ Applicable √ Inapplicable
IV. Resumption and exercise of voting rights of preferred shares
□ Applicable √ Inapplicable
V. Accounting policies adopted for preferred shares and reasons
□ Applicable √ Inapplicable
45
2014 Semi-annual Report of Konka Group Co., Ltd.
Section VIII. Directors, Supervisors & Senior Management Staff
I. Change of shareholdings of directors, supervisors and senior management staff
□ Applicable √ Inapplicable
There was no change in the shareholdings of directors, supervisors and senior
management staff in the reporting period. For details, please refer to the 2013 Annual
Report.
Notes: During the reporting period, the original Vice President Mr. Cheng Dahou,
the original CFO Miss Yang Rong respectively resigned the position of Vice President
and CFO owning to personal reasons. Due to the working requirements, the Board of
the Directors decided to engage Mr. Huang Zhiqiang to act as the CFO of the Company.
Before resignation, Mr. Cheng Dahou and Miss Yang Rong were both not holding any
equity of the Company. Up to now, Mr. Huang Zhiqiang had not held any equity of the
Company.
II. Change of directors, supervisors and senior management staff
√ Applicable □ Inapplicable
Name Position Type Date Reason
Huang
CFO Engaged 26 May 2014 The Board of Directors decided to engage
Zhiqiang
Yang Rong CFO Left 23 May 2014 Resigned due to personal reasons
Vice
Cheng Dahou Left 11 Jan. 2014 Resigned due to personal reasons
President
46
2014 Semi-annual Report of Konka Group Co., Ltd.
Section IX. Financial Report
I. Audit report
Has this semi-annual report been audited?
□ Yes √ No
The semi-annual financial report has not been audited.
II. Financial statements
Currency unit for the statements in the notes to these financial statements: RMB
Yuan
1. Consolidated balance sheet
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 1,845,450,410.78 1,843,743,089.94
Settlement reserves
Intra-group lendings
Transactional financial
assets
Notes receivable 3,155,922,771.85 4,150,779,374.32
Accounts receivable 2,157,471,664.67 2,460,996,984.92
Accounts paid in advance 732,908,512.60 164,272,929.59
Premiums receivable
Reinsurance premiums
receivable
Receivable reinsurance
contract reserves
Interest receivable 5,820,820.78 2,898,419.90
Dividend receivable
Other accounts receivable 296,812,203.24 298,749,414.95
Financial assets purchased
under agreements to resell
Inventories 3,287,630,042.47 3,582,669,024.26
Non-current assets due within
1 year
Other current assets 418,115,952.51
47
2014 Semi-annual Report of Konka Group Co., Ltd.
Total current assets 11,900,132,378.90 12,504,109,237.88
Non-current assets:
Loans by mandate and advances
granted
Available-for-sale financial
970,153.70 941,999.30
assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 453,875,500.82 446,155,499.42
Investing property 235,182,598.79 237,986,524.12
Fixed assets 1,872,485,686.55 1,908,503,979.80
Construction in progress 102,548,970.02 49,924,027.97
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 355,535,205.35 359,585,571.12
R&D expense
Goodwill 3,914,638.11 3,943,671.53
Long-term deferred expenses 13,875,055.32 13,405,084.94
Deferred income tax assets 220,145,915.22 218,728,739.41
Other non-current assets
Total of non-current assets 3,258,533,723.88 3,239,175,097.61
Total assets 15,158,666,102.78 15,743,284,335.49
Current liabilities:
Short-term borrowings 5,111,696,625.00 5,239,069,764.48
Borrowings from Central Bank
Customer bank deposits and due
to banks and other financial
institutions
Intra-group borrowings
Transactional financial
liabilities
Notes payable 622,013,184.02 565,137,790.84
Accounts payable 2,759,994,170.27 3,341,804,144.12
48
2014 Semi-annual Report of Konka Group Co., Ltd.
Accounts received in advance 392,256,236.76 482,716,035.68
Financial assets sold for
repurchase
Handling charges and
commissions payable
Employee ’ s compensation
252,737,384.42 332,090,987.76
payable
Tax payable -97,335,503.73 -94,670,496.91
Interest payable 30,171,536.26 34,945,870.48
Dividend payable 0.00
Other accounts payable 1,274,735,048.69 1,391,396,130.97
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting
underwriting of securities
Non-current liabilities due
1,755,444.00 1,755,444.00
within 1 year
Other current liabilities
Total current liabilities 10,348,024,125.69 11,294,245,671.42
Non-current liabilities:
Long-term borrowings 326,110,836.38 5,000,000.00
Bonds payable
Long-term payables 30,584,573.59 31,366,530.13
Specific payables
Projected liabilities 911,085.41 911,085.41
Deferred income tax
liabilities
Other non-current liabilities 135,387,720.22 131,658,369.11
Total non-current liabilities 492,994,215.60 168,935,984.65
Total liabilities 10,841,018,341.29 11,463,181,656.07
Owners ’ equity (or
shareholders’ equity)
Paid-up capital (or share
1,203,972,704.00 1,203,972,704.00
capital)
49
2014 Semi-annual Report of Konka Group Co., Ltd.
Capital reserves 1,274,427,058.58 1,274,405,942.78
Less: Treasury stock
Specific reserves
Surplus reserves 847,908,466.28 847,908,466.28
Provisions for general risks
Retained profits 771,312,105.98 737,991,722.40
Foreign exchange difference 18,354,999.44 16,179,316.17
Total equity attributable to
4,115,975,334.28 4,080,458,151.63
owners of the Company
Minority interests 201,672,427.21 199,644,527.79
Total owners ’ (or
4,317,647,761.49 4,280,102,679.42
shareholders’) equity
Total liabilities and owners’
15,158,666,102.78 15,743,284,335.49
(or shareholders’) equity
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
2. Balance sheet of the Company
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 1,235,695,822.70 1,118,577,010.98
Transactional financial
assets
Notes receivable 3,043,058,380.00 3,963,969,934.07
Accounts receivable 1,298,576,509.59 1,543,050,476.67
Accounts paid in advance 705,836,671.18 239,011,903.60
Interest receivable 21,734,154.03 12,151,753.22
Dividend receivable
Other accounts receivable 567,953,508.84 668,297,184.77
Inventories 1,977,146,467.90 2,333,107,085.15
Non-current assets due within
1 year
Other current assets 418,115,952.51
Total current assets 9,268,117,466.75 9,878,165,348.46
Non-current assets:
50
2014 Semi-annual Report of Konka Group Co., Ltd.
Available-for-sale financial
970,153.70 941,999.30
assets
Held-to-maturity investments 545,000,000.00 505,000,000.00
Long-term accounts receivable
Long-term equity investment 1,664,124,024.93 1,675,299,526.82
Investing property 235,182,598.79 237,986,524.12
Fixed assets 597,800,017.06 599,950,784.99
Construction in progress 33,776,117.79 8,713,508.63
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 74,513,844.73 76,133,522.45
R&D expense
Goodwill
Long-term deferred expenses 5,060,387.05 4,597,304.79
Deferred income tax assets 190,925,315.55 183,062,820.76
Other non-current assets
Total of non-current assets 3,347,352,459.60 3,291,685,991.86
Total assets 12,615,469,926.35 13,169,851,340.32
Current liabilities:
Short-term borrowings 506,380,067.85 1,023,913,426.22
Transactional financial
liabilities
Notes payable 247,107,042.06 190,949,990.17
Accounts payable 6,476,327,109.03 6,320,384,438.01
Accounts received in advance 99,358,344.19 186,326,967.62
Employee ’ s compensation
139,975,271.85 187,697,895.87
payable
Tax payable -84,518,860.31 -92,265,968.33
Interest payable 4,635,289.28 21,189,076.79
Dividend payable
Other accounts payable 1,103,099,486.84 1,243,478,983.84
Non-current liabilities due
within 1 year
51
2014 Semi-annual Report of Konka Group Co., Ltd.
Other current liabilities
Total current liabilities 8,492,363,750.79 9,081,674,810.19
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Projected liabilities
Deferred income tax
liabilities
Other non-current liabilities 77,923,089.39 74,192,786.56
Total non-current liabilities 77,923,089.39 74,192,786.56
Total liabilities 8,570,286,840.18 9,155,867,596.75
Owners ’ equity (or
shareholders’ equity)
Paid-up capital (or share
1,203,972,704.00 1,203,972,704.00
capital)
Capital reserves 1,250,154,705.84 1,250,133,590.04
Less: Treasury stock
Specific reserves
Surplus reserves 847,908,466.28 847,908,466.28
General risk provision
Retained profits 743,147,210.05 711,968,983.25
Foreign exchange difference
Total owners ’ (or
4,045,183,086.17 4,013,983,743.57
shareholders’) equity
Total liabilities and owners’
12,615,469,926.35 13,169,851,340.32
(or shareholders’) equity
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
3. Consolidated income statement
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Total operating revenues 8,398,300,541.63 9,421,399,281.00
Including: Sales income 8,398,300,541.63 9,421,399,281.00
52
2014 Semi-annual Report of Konka Group Co., Ltd.
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 8,635,757,107.57 9,394,355,334.09
Including: Cost of sales 7,010,567,842.76 7,835,777,505.69
Interest expenses
Handling charge and
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for
the insurance contract reserve
Expenditure on policy
dividends
Reinsurance premium
Taxes and associate
27,413,731.56 33,034,164.50
charges
Selling and distribution
1,155,868,360.85 1,211,403,089.80
expenses
Administrative expenses 304,442,442.38 312,936,108.52
Financial expenses 101,860,777.24 -21,707,338.29
Asset impairment loss 35,603,952.78 22,911,803.87
Add: Gain/(loss) from change in
fair value (“-” means loss)
Gain/(loss) from investment
266,440,118.63 -8,176,580.12
(“-” means loss)
Including: share of profits in
1,720,001.40 -8,197,695.92
associates and joint ventures
Foreign exchange gains ( “ - ”
means loss)
III. Business profit (“-” means
28,983,552.69 18,867,366.79
loss)
Add: non-operating income 58,215,468.02 45,954,814.02
Less: non-operating expense 4,035,941.02 5,125,852.63
Including: loss from non-current
3,468,914.31 3,868,800.73
asset disposal
53
2014 Semi-annual Report of Konka Group Co., Ltd.
IV. Total profit ( “- ” means
83,163,079.69 59,696,328.18
loss)
Less: Income tax expense 35,836,725.94 23,047,922.18
V. Net profit (“-” means loss) 47,326,353.75 36,648,406.00
Including: Net profit
achieved by combined parties
before the combinations
Attributable to owners of
45,360,110.62 40,547,673.62
the Company
Minority shareholders ’
1,966,243.13 -3,899,267.62
income
VI. Earnings per share -- --
(I) Basic earnings per share 0.0377 0.0337
(II) Diluted earnings per
0.0377 0.0337
share
VII. Other comprehensive incomes 2,258,455.36 2,880,089.41
VIII. Total comprehensive
49,584,809.11 39,528,495.41
incomes
Attributable to owners of
47,556,909.69 43,427,763.03
the Company
Attributable to minority
2,027,899.42 -3,899,267.62
shareholders
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
4. Income statement of the Company
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Total sales 8,456,008,434.03 9,702,218,724.14
Less: cost of sales 7,493,298,863.06 8,499,715,386.70
Business taxes and surcharges 16,962,060.20 21,482,263.96
Distribution expenses 922,354,852.66 943,734,400.78
Administrative expenses 196,095,536.45 139,566,110.08
Financial costs 27,970,672.63 -6,425,825.96
Impairment loss 27,776,711.70 15,096,511.60
Add: gain/(loss) from change in
fair value (“-” means loss)
54
2014 Semi-annual Report of Konka Group Co., Ltd.
Gain/(loss) from investment (“-”
255,170,977.51 21,115.80
means loss)
Including: income form
investment on associates and -2,175,501.89
joint ventures
II. Business profit (“-” means
26,720,714.84 89,070,992.78
loss)
Add: non-business income 33,360,363.48 28,874,525.07
Less: non-business expense 1,608,736.38 1,367,346.85
Including: loss from non-current
1,514,063.10 708,641.08
asset disposal
III. Total profit (“-” means
58,472,341.94 116,578,171.00
loss)
Less: income tax expense 15,254,388.10 27,495,677.19
IV. Net profit (“-”means loss) 43,217,953.84 89,082,493.81
V. Earnings per share -- --
(I) Basic earnings per share
(II) Diluted earnings per share
VI. Other comprehensive income 21,115.80 -23,755.27
VII. Total comprehensive income 43,239,069.64 89,058,738.54
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
5. Consolidated cash flow statement
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Cash flows from operating
activities:
Cash received from sale of
commodities and rendering of 8,265,282,430.24 10,162,808,854.72
service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the
central bank
Net increase of funds borrowed
from other financial
55
2014 Semi-annual Report of Konka Group Co., Ltd.
institutions
Cash received from premium of
original insurance contracts
Net cash received from
reinsurance business
Net increase of deposits of
policy holders and investment
fund
Net increase of disposal of
tradable financial assets
Cash received from interest,
handling charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in
repurchase business
Tax refunds received 196,033,233.62 153,435,412.27
Other cash received relating
173,270,417.80 205,805,076.79
to operating activities
Subtotal of cash inflows from
8,634,586,081.66 10,522,049,343.78
operating activities
Cash paid for goods and
5,557,372,388.56 5,650,732,166.65
services
Net increase of customer
lendings and advances
Net increase of funds
deposited in the central bank and
amount due from banks
Cash for paying claims of the
original insurance contracts
Cash for paying interest,
handling charges and commissions
Cash for paying policy
dividends
Cash paid to and for employees 881,787,596.74 861,559,419.57
Various taxes paid 414,347,427.94 954,929,345.27
Other cash payment relating to
573,150,587.30 783,138,191.86
operating activities
56
2014 Semi-annual Report of Konka Group Co., Ltd.
Subtotal of cash outflows from
7,426,658,000.54 8,250,359,123.35
operating activities
Net cash flows from operating
1,207,928,081.12 2,271,690,220.43
activities
II. Cash flows from investing
activities:
Cash received from withdrawal
13,879,620.00 -
of investments
Cash received from return on
157,693.56 2,048,223.48
investments
Net cash received from
disposal of fixed assets,
7,917,613.23 29,550,434.18
intangible assets and other
long-term assets
Net cash received from
disposal of subsidiaries or 233,782,351.98 -
other business units
Other cash received relating
200,000,000.00
to investing activities
Subtotal of cash inflows
455,737,278.77 31,598,657.66
from investing activities
Cash paid to acquire fixed
assets, intangible assets and 626,949,134.37 99,970,151.12
other long-term assets
Cash paid for investment 7,723,300.00
Net increase of pledged loans
Net cash paid to acquire
subsidiaries and other business
units
Other cash payments relating
600,183,497.35
to investing activities
Subtotal of cash outflows from
1,234,855,931.72 99,970,151.12
investing activities
Net cash flows from investing
-779,118,652.95 -68,371,493.46
activities
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
57
2014 Semi-annual Report of Konka Group Co., Ltd.
Including: Cash received from
minority shareholder
investments by subsidiaries
Cash received from borrowings 1,671,417,041.46 2,508,372,133.01
Cash received from issuance
of bonds
Other cash received relating
236,460.60 1,089,113,577.37
to financing activities
Subtotal of cash inflows from
1,671,653,502.06 3,597,485,710.38
financing activities
Repayment of borrowings 2,027,899,932.25 4,376,015,648.31
Cash paid for interest
expenses and distribution of 44,821,809.15 85,282,170.19
dividends or profit
Including: dividends or
profit paid by subsidiaries to
minority shareholders
Other cash payments relating
178,071,161.01 409,177,553.47
to financing activities
Sub-total of cash outflows from
2,250,792,902.41 4,870,475,371.97
financing activities
Net cash flows from financing
-579,139,400.35 -1,272,989,661.59
activities
IV. Effect of foreign exchange
rate changes on cash and cash 10,892,224.69 14,934,241.48
equivalents
V. Net increase in cash and cash
-139,437,747.49 945,263,306.86
equivalents
Add: Opening balance of cash
1,771,489,421.21 824,043,169.37
and cash equivalents
VI. Closing balance of cash and
1,632,051,673.72 1,769,306,476.23
cash equivalents
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
58
2014 Semi-annual Report of Konka Group Co., Ltd.
6. Cash flow statement of the Company
Prepared by Konka Group Co., Ltd.
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Cash flows from operating
activities:
Cash received from sale of
commodities and rendering of 6,366,712,860.82 8,169,470,748.42
service
Tax refunds received 74,807,745.10 100,561,758.82
Other cash received relating
161,045,296.10 131,778,571.89
to operating activities
Subtotal of cash inflows from
6,602,565,902.02 8,401,811,079.13
operating activities
Cash paid for goods and
4,475,725,045.81 4,399,419,343.02
services
Cash paid to and for employees 485,469,053.36 486,682,695.14
Various taxes paid 191,472,856.18 733,498,583.63
Other cash payment relating to
616,128,790.00 567,857,933.56
operating activities
Subtotal of cash outflows from
5,768,795,745.35 6,187,458,555.35
operating activities
Net cash flows from operating
833,770,156.67 2,214,352,523.78
activities
II. Cash flows from investing
activities:
Cash received from retraction
261,567,420.00
of investments
Cash received from return on
8,624,360.22 11,780,384.78
investments
Net cash received from
disposal of fixed assets,
7,556,113.23 22,513,818.18
intangible assets and other
long-term assets
Net cash received from
disposal of subsidiaries or
other business units
Other cash received relating 200,000,000.00 30,000,000.00
59
2014 Semi-annual Report of Konka Group Co., Ltd.
to investing activities
Subtotal of cash inflows
477,747,893.45 64,294,202.96
from investing activities
Cash paid to acquire fixed
assets, intangible assets and 540,291,381.68 52,560,352.69
other long-term assets
Cash paid for investment 1,723,300.00
Net cash paid to acquire
subsidiaries and other business
units
Other cash payments relating
640,000,000.00 140,000,000.00
to investing activities
Subtotal of cash outflows from
1,182,014,681.68 192,560,352.69
investing activities
Net cash flows from investing
-704,266,788.23 -128,266,149.73
activities
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Cash received from borrowings 142,130,800.00
Cash received from issuance
of bonds
Other cash received relating
235,988.85 1,089,113,577.37
to financing activities
Subtotal of cash inflows from
235,988.85 1,231,244,377.37
financing activities
Repayment of borrowings 2,001,719,302.86
Cash paid for interest
expenses and distribution of 11,854,357.13 60,306,800.51
dividends or profit
Other cash payments relating
176,578,387.43 407,569,308.18
to financing activities
Sub-total of cash outflows from
188,432,744.56 2,469,595,411.55
financing activities
Net cash flows from financing
-188,196,755.71 -1,238,351,034.18
activities
IV. Effect of foreign exchange
-530,199.59 4,658,418.09
rate changes on cash and cash
60
2014 Semi-annual Report of Konka Group Co., Ltd.
equivalents
V. Net increase in cash and cash
-59,223,586.86 852,393,757.96
equivalents
Add: Opening balance of cash
1,117,689,643.16 365,891,615.75
and cash equivalents
VI. Closing balance of cash and
1,058,466,056.30 1,218,285,373.71
cash equivalents
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
7. Consolidated statement of changes in owners’ equity
Prepared by Konka Group Co., Ltd.
Jan.-Jun. 2014
Unit: RMB Yuan
Reporting period
Equity attributable to owners of the Company
Paid-u
p Gener Minori
Capit Less: Speci Surpl Retai Total
Item capita al ty
al treas fic us ned Other owners’
l (or risk intere
reser ury reser reser profi s equity
share reser sts
ve stock ve ve t
capita ve
l)
1,274
1,203, 847,9 737,9 16,17 199,64 4,280,1
I. Balance at the end of ,405,
972,70 08,46 91,72 9,316 4,527. 02,679.
the previous year 942.7
4.00 6.28 2.40 .17 79 42
8
Add: change of
accounting policy
Correction of errors
in previous periods
Other
1,274
1,203, 847,9 737,9 16,17 199,64 4,280,1
II. Balance at the ,405,
972,70 08,46 91,72 9,316 4,527. 02,679.
beginning of the year 942.7
4.00 6.28 2.40 .17 79 42
8
III. Increase/ decrease 33,32 2,175
21,11 2,027, 37,545,
of amount in the year 0,383 ,683.
5.80 899.42 082.07
(“-” means decrease) .58 27
45,36
(I) Net profit 1,966, 47,326,
0,110
61
2014 Semi-annual Report of Konka Group Co., Ltd.
.62 243.13 353.75
2,175
(II) Other 21,11 61,656 2,258,4
,683.
comprehensive incomes 5.80 .29 55.36
27
45,36 2,175
Subtotal of (I) and 21,11 2,027, 49,584,
0,110 ,683.
(II) 5.80 899.42 809.11
.62 27
(III) Capital paid in
and reduced by owners
1. Capital paid in
by owners
2. Amounts of
share-based payments
recognized in owners ’
equity
3. Others
-12,0
(IV) Profit -12,039
39,72
distribution ,727.04
7.04
1. Appropriations
to surplus reserves
2. Appropriations
to general risk
provisions
3. Appropriations -12,0
-12,039
to owners (or 39,72
,727.04
shareholders) 7.04
4. Other
(V) Internal
carry-forward of
owners’ equity
1. New increase of
capital (or share
capital) from capital
public reserves
2. New increase of
capital (or share
capital) from surplus
reserves
3. Surplus reserves
62
2014 Semi-annual Report of Konka Group Co., Ltd.
for making up losses
4. Other
(VI) Specific reserve
1. Withdrawn for the
period
2. Used in the
period
(VII) Other
1,274
1,203, 847,9 771,3 18,35 201,67 4,317,6
,427,
IV. Closing balance 972,70 08,46 12,10 4,999 2,427. 47,761.
058.5
4.00 6.28 5.98 .44 21 49
8
Jan.-Jun. 2013
Unit: RMB Yuan
Last year
Equity attributable to owners of the Company
Paid-
up
Gener Minori
capit Capit Less: Speci Surpl Retai Total
Item al ty
al al treas fic us ned Other owners’
risk intere
(or reser ury reser reser profi s equity
reser sts
share ve stock ve ve t
ve
capit
al)
1,203 1,272
827,2 725,4 14,42 203,25 4,246,8
I. Balance at the end of ,972, ,420,
91,20 85,70 1,594 6,243. 47,782.
the previous year 704.0 328.4
7.52 4.10 .77 27 12
0 6
Add: retrospective
adjustments due to
business combinations
under the same control
Add: change of
accounting policy
Correction of errors in
previous periods
Other
1,203 1,272 827,2 725,4 14,42 203,25 4,246,8
II. Balance at the
,972, ,420, 91,20 85,70 1,594 6,243. 47,782.
63
2014 Semi-annual Report of Konka Group Co., Ltd.
beginning of the year 704.0 328.4 7.52 4.10 .77 27 12
0 6
III. Increase/ decrease 28,50 2,903 -3,899
-23,7 27,488,
of amount in the year (“-” 7,946 ,844. ,267.6
55.27 768.37
means decrease) .58 68 2
40,54 -3,899
36,648,
(I) Net profit 7,673 ,267.6
406.00
.62 2
2,903
(II) Other -23,7 2,880,0
,844.
comprehensive incomes 55.27 89.41
68
40,54 2,903 -3,899
Subtotal of (I) and -23,7 39,528,
7,673 ,844. ,267.6
(II) 55.27 495.41
.62 68 2
(III) Capital paid in
and reduced by owners
1. Capital paid in by
owners
2. Amounts of
share-based payments
recognized in owners ’
equity
3. Others
-12,0
(IV) Profit -12,039
39,72
distribution ,727.04
7.04
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
-12,0
3. Appropriations to -12,039
39,72
owners (or shareholders) ,727.04
7.04
4. Other
(V) Internal
carry-forward of owners’
equity
1. New increase of
capital (or share
capital) from capital
64
2014 Semi-annual Report of Konka Group Co., Ltd.
public reserves
2. New increase of
capital (or share
capital) from surplus
reserves
3. Surplus reserves
for making up losses
4. Other
(VI) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(VII) Other
1,203 1,272
827,2 753,9 17,32 199,35 4,274,3
,972, ,396,
IV. Closing balance 91,20 93,65 5,439 6,975. 36,550.
704.0 573.1
7.52 0.68 .45 65 49
0 9
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
8. Statement of changes in owners’ equity of the Company
Prepared by Konka Group Co., Ltd.
Jan.-Jun. 2014
Unit: RMB Yuan
Reporting period
Paid-up
capital
Less: Specifi General Retaine Total
Item (or Capital Surplus
treasur c risk d owners’
share reserve reserve
y stock reserve reserve profit equity
capital
)
1,203,9 1,250,1 4,013,9
I. Balance at the end of the 847,908 711,968
72,704. 33,590. 83,743.
previous year ,466.28 ,983.25
00 04 57
Add: change of
accounting policy
Correction of errors in
previous periods
Other
65
2014 Semi-annual Report of Konka Group Co., Ltd.
1,203,9 1,250,1 4,013,9
II. Balance at the 847,908 711,968
72,704. 33,590. 83,743.
beginning of the year ,466.28 ,983.25
00 04 57
III. Increase/ decrease in
21,115. 31,178, 31,199,
the period ( “ - ” means
80 226.80 342.60
decrease)
43,217, 43,217,
(I) Net profit
953.84 953.84
(II) Other comprehensive 21,115. 21,115.
incomes 80 80
21,115. 43,217, 43,239,
Subtotal of (I) and (II)
80 953.84 069.64
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of
share-based payments
recognized in owners ’
equity
3. Others
-12,039 -12,039
(IV) Profit distribution
,727.04 ,727.04
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
3. Appropriations to -12,039 -12,039
owners (or shareholders) ,727.04 ,727.04
4. Other
(V) Internal
carry-forward of owners’
equity
1. New increase of
capital (or share capital)
from capital public
reserves
2. New increase of
capital (or share capital)
66
2014 Semi-annual Report of Konka Group Co., Ltd.
from surplus reserves
3. Surplus reserves
for making up losses
4. Other
(VI) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(VII) Other
1,203,9 1,250,1 4,045,1
847,908 743,147
IV. Closing balance 72,704. 54,705. 83,086.
,466.28 ,210.05
00 84 17
Jan.-Jun. 2013
Unit: RMB Yuan
Same period of last year
Paid-up
capital
Less: Specifi General Retaine Total
Item (or Capital Surplus
treasur c risk d owners’
share reserve reserve
y stock reserve reserve profit equity
capital
)
1,203,9 1,249,2 3,819,0
I. Balance at the end of the 827,291 538,453
72,704. 90,161. 07,454.
previous year ,207.52 ,381.46
00 88 86
Add: change of
accounting policy
Correction of errors in
previous periods
Other
1,203,9 1,249,2 3,819,0
II. Balance at the 827,291 538,453
72,704. 90,161. 07,454.
beginning of the year ,207.52 ,381.46
00 88 86
III. Increase/ decrease in
-23,755 77,042, 77,019,
the period ( “ - ” means
.27 766.77 011.50
decrease)
89,082, 89,082,
(I) Net profit
493.81 493.81
(II) Other comprehensive -23,755 -23,755
incomes .27 .27
67
2014 Semi-annual Report of Konka Group Co., Ltd.
-23,755 89,082, 89,058,
Subtotal of (I) and (II)
.27 493.81 738.54
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of
share-based payments
recognized in owners ’
equity
3. Others
-12,039 -12,039
(IV) Profit distribution
,727.04 ,727.04
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
3. Appropriations to -12,039 -12,039
owners (or shareholders) ,727.04 ,727.04
4. Other
(V) Internal
carry-forward of owners’
equity
1. New increase of
capital (or share capital)
from capital public
reserves
2. New increase of
capital (or share capital)
from surplus reserves
3. Surplus reserves
for making up losses
4. Other
(VI) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(VII) Other
68
2014 Semi-annual Report of Konka Group Co., Ltd.
1,203,9 1,249,2 3,896,0
827,291 615,496
IV. Closing balance 72,704. 66,406. 26,466.
,207.52 ,148.23
00 61 36
Legal representative: Wu Siyuan Chief of the accounting work: Huang Zhiqiang
Chief of the accounting organ: Xu Youshan
69
III. Company Profile
1. Establishment
Konka Group Co., Ltd. (hereinafter referred to as “Company” or “the Company”),
is a joint-stock limited company reorganized from the former Shenzhen Konka
Electronic Co., Ltd. in August 1991 upon approval of the People’s Government of
Shenzhen Municipality, and has its ordinary shares (A-share and B-share) listed on
Shenzhen Stock Exchange with prior consent from the People’s Bank of China Shenzhen
Special Economic Zone Branch. On August 29, 1995, the Company, renamed to “Konka
Group Co., Ltd. ” , obtained corporate business license (registration No.:
440301501121863) with its main business falling into electronic industry.
2. Share Capital Changes upon Establishment
On November 27, 1991, with approval from the SRYFZ No. 102 [1991] document as issued
by the People’s Bank of China Shenzhen Special Economic Zone Branch, Shenzhen Konka
Electronic Co., Ltd., during December 8—December 31, 1991, has issued 128,869,000
RMB ordinary shares (A-share) at a par value of RMB1.00 per share, of which the
original net assets were converted into 98,719,000 state-owned institutional shares,
30,150,000 new shares were issued, including 26,500,000 circulating shares issued
to the public and 3,650,000 staff shares issued to the staff of the Company.
On January 29, 1992, with approval from the SRYFZ No. 106 [1991] document as issued
by the People’s Bank of China Shenzhen Special Economic Zone Branch, Shenzhen Konka
Electronic Co., Ltd., during December 20, 1991— January 31, 1992, has issued to
investors abroad 58,372,300 RMB special shares (B-share) at a par value of RMB1.00
per share, of which 48,372,300 shares held by the former foreign investor and founder
—Hong Kong Ganghua Electronic Group Co., Ltd. are converted into foreign legal
person’s shares, and 10,000,000 B-shares are issued additionally.
On April 10, 1993, the Proposal on Profit Distribution and Dividend Payout 1992 was
adopted at the second general meeting of shareholders of the Company. With approval
from the SZBF No. 2 [1993] document as issued by Shenzhen Securities Regulatory Office,
the Company began to perform dividend policy for FY 1992 as of April 30, 1993:
distributing RMB 0.90 in cash plus 3.5 bonus shares for every 10 shares to all
shareholders. The total capital stock reached 187,473,150 shares after this
distribution.
On April 18, 1994, the Proposal on Profit Distribution and Dividend Payout 1993 was
adopted at the third general meeting of shareholders of the Company. With approval
from the SZBF No. 115 [1994] document as issued by Shenzhen Securities Regulatory
Office, the Company began to perform dividend policy for FY1993 as of June 10, 1994:
distributing RMB 1.10 in cash plus 5 bonus shares (including 4.4 profit bonus shares
70
and 0.6 bonus share capitalized from capital public reserve) for every 10 shares
to all shareholders. The total capital stock reached 281,209,724 shares after this
distribution and capitalization from capital public reserve.
On June 2, 1994, in accordance with the provisions that “staff shares could go public
and be transferred six months after listing”, as jointly promulgated by the State
Commission for Restructuring the Economic System and the State Council’s Securities
Commission, the staff shares of the Company was planned to be listed on the flow
on June 6, 1994, with the prior consent of Shenzhen Securities Regulatory Office
and Shenzhen Stock Exchange.
On October 8, 1994, the Proposal on Negotiable Bonus Shares of B-Share Corporate
Shareholders 1992 was adopted at the 1994 interim general meeting of shareholders
of the Company. With approval from the SZBF No. 224 [1994] document as issued by
Shenzhen Securities Regulatory Office, the 16,930,305 bonus shares for FY 1992
granted to foreign legal persons were listed and negotiated at B-share market on
October 26, 1994.
On February 6, 1996, the Proposal on Share Allotment Modes 1996 was adopted at the
1996 interim general metering of shareholders of the Company. With approval from
the SZBF No. 5 [1996] document as issued by Shenzhen Securities Regulatory Office,
and reexamination from the ZJPSZ No. 16 [1996] document and ZJGZ No. 2 [1996] document
as issued by China Securities Regulatory Commission, on July 16, 1996 and October
29, 1996, all shareholders were respectively allotted three shares for every ten
existing shares held at RMB 6.28/A-share and HKD 5.85/B-share. Corporate
shareholders took their respective existing shares as bases for full subscription
of the allocable shares. The total capital stock reached 365,572,641 shares after
this allotment.
On January 25, 1998, the Plan on Share Allotment 1998 was adopted at the 1998 interim
general meeting of shareholders of the Company. With approval from the ZZBZ No. 29
[1998] document as issued by Shenzhen Securities Regulatory Office, and ZJSZ No.64
[1998] document as issued by China Securities Regulatory Commission, on July 15,
1998, negotiable A-shares were allotted in proportion of 3:10 at RMB 10.50/A-share.
For such reasons as continued weakness in B-share secondary market (lower than share
allotment price), B-share negotiation and allotment plan was canceled, and the
corporate shareholders of the Company waived the preemptive right. The total capital
stock reached 389,383,603 shares after this allotment.
On June 30, 1999, the Proposal on Profit Distribution and Capitalization from Capital
Public Reserve 1998 was adopted at the eighth general meeting of shareholders of
the Company. On August 20, 1999, the profit distribution for FY 1998 was carried
out: all shareholders were presented RMB3.00 in cash for every 10 shares, plus 2
71
shares capitalized from capital public reserve. The total capital stock reached
467,260,323 shares after this capitalization.
On June 30, 1999, the Plan on A-Share Issue for Capital Increase was adopted at the
eighth general meeting of shareholders of the Company. With approval from the ZJFXZ
No.140 [1999] document as issued by China Securities Regulatory Commission, on
November 1, 1999, 80,000,000 A-shares were additionally issued to the public at
RMB15.50/share. The total capital stock reached 547,260,323 shares after this
additional issue.
On May 30, 2000, the Plan on Profit Distribution and Dividend Payout 1999 was adopted
at the ninth general meeting of shareholders of the Company. On July 25, 2000, the
profit distribution for FY 1999 was carried out: all shareholders were distributed
RMB4.00 in cash plus 1 bonus shares for every 10 shares. The total capital stock
reached 601,986,352 shares after this distribution.
On April 3, 2008, the 7th meeting of the sixth Board of Directors was convened, during
which the following resolutions were discussed and adopted: based on the total
capital stock of 601,986,352 shares for the year ended December 31, 2007,
capitalization from capital public reserve was made to all shareholders at a
proportion of 1:1, namely 10 new shares for every 10 existing shares. And the said
resolution was subject to approval by the 2007 annual general meeting of shareholders
convened on May 26, 2008. The Company, in June 2008, implemented the capitalization
from capital public reserve and went through the formalities for transfer
registration with China Securities Depository and Clearing Corporation Limited. On
December 16, 2008, with approval from the SMGZF No. 2662 [2008] document as issued
by Shenzhen Bureau of Trade and Industry, the Company was agreed to increase its
share capital, and went through the formalities for registration of changes with
the administration for industry and commerce on April 10, 2009. The total capital
stock reached 1,203,972,704 shares after change.
3. Approved business scope: research and development, production and operation of
such household appliances as televisions, refrigerators, washing machines, and
personal electronic appliances; manufacturing and application of home AV, IPTV
set-top boxes, digital TV receivers (including ground receiving equipment of
satellite television broadcasting), digital products, mobile communication
equipments and terminal products, daily-use electronic products, automotive
electronic products, satellite navigation systems, intelligent transportation
systems, fire-fighting and security systems, office equipments, computers, displays,
large screen display systems; LED (OLED) back light, illumination, light-emitting
devices, and packaging thereof; Touch TV AIO, wireless broadcasting television
transiting equipment; electronic parts and components, moulds, plastic and rubber
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products, and packing materials, design and in-door installation security products,
monitoring products, wireless and cable digital television system and system
integration, and technical consultancy and after-sale paid services of related
products( except mobile phone, the other products in the above business scope are
manufactured in other places outside Shenzhen); Wholesale, retail, import & export
and relevant support services of the aforesaid products (including spare parts)
(Commodities subject to state trading management are not involved. Products involved
in quota, license management and other specified management shall be subject to the
relevant state provisions.); sale of self-developed technological achievements;
provision of maintenance services, technical consultant service for electronic
products; ordinary cargo transportation, domestic freight forwarding, warehousing
services; consultancy on enterprise management; and self-owned property leasing and
management services, recovery of waste electrical appliances and electronic products
(excluding dissembling) (operated by branch offices); and outsourcing services of
information technology and business procedures by means of undertaking services in
the way of outsourcing, including management and maintenance of system application,
management of information technology, bank background service, financial settlement,
human resource service, software development, call center, and data processing.
4. The parent company, as well as the actual controller of the Group is Overseas
Chinese Town Group Co., Ltd., and the ultimate controller is the State-owned Assets
Supervision and Administration Commission of the State Council.
5. The financial statements of the Company were submitted upon approval of the Board
of Directors on 26 Aug 2014.
6. A check list of corporate names and their abbreviations mentioned in this Report
Corporate name Abbreviation
Shenzhen Konka Telecommunications Technology Co., Ltd. Telecommunication Technology
Video & Communication Systems
Shenzhen Konka Video & Communication Systems Engineering Co., Ltd.
Engineering
Shenzhen Konka Precision Mold Manufacturing Co., Ltd. Precision Mold
Shenzhen Konka Electronic Co., Ltd. Konka Electronic
Shenzhen Konka Information Network Co., Ltd. Information Network
Shenzhen Konka Plastic Products Co., Ltd. Plastic Products
Shenzhen Konka Life Electric Appliance Co., Ltd. Life Electric Appliance
Shenzhen Electronic Fittings Technology Co., Ltd. Fittings Technology
Mudanjiang Arctic Ocean Appliances Co., Ltd. Mudanjiang Appliances
Shaanxi Konka Electronic Co., Ltd. Shaanxi Konka
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Corporate name Abbreviation
Chongqing Konka Electronic Co., Ltd. Chongqing Konka
Chongqing Konka Automotive Electronic Co., Ltd. Chongqing Electronic
Chongqing Qingjia Electronics Co., Ltd. Chongqing Qingjia
Anhui Konka Electronic Co., Ltd. Anhui Konka
Anhui Konka Household Appliances Co., Ltd. Anhui Household Appliances
Changshu Konka Electronic Co., Ltd. Changshu Konka
Kunshan Konka Electronic Co., Ltd. Kunshan Konka
Dongguan Konka Electronic Co., Ltd. Dongguan Konka
Dongguan Konka Packing Materials Co., Ltd. Dongguan Packing
Dongguan Konka Mould Plastic Co., Ltd. Dongguan Mould Plastic
Boluo Konka PCB Co., Ltd. Boluo Konka
Boluo Konka Precision Technology Co., Ltd. Boluo Precision
Konka (Nanhai) Development Center Nanhai Institute
Hong Kong Konka Co., Ltd. Hong Kong Konka
Konka Household Appliances
Konka Household Appliances Investment & Development Co., Ltd.
Investment
Konka Household Appliances
Konka Household Appliances International Trading Co., Ltd.
International Trading
KONKA AMERICA,INC. KONKA AMERICA
Konka (Europe) Co., Ltd. Konka Europe
Dongguan Xutongda Mould Plastic Co., Ltd. Xutongda
Shenzhen Konka Optoelectronic Technology Co., Ltd. Konka Optoelectronic
Shenzhen Wankaida Science and Technology Co., Ltd. Wankaida
Kunshan Kangsheng Investment Development Co., Ltd. Kunshan Kangsheng
Anhui Konka Tongchuang Household Appliances Co., Ltd. Anhui Tongchuang
Indonesia Konka Electronics Co., Ltd. Indonesia Konka
Shenzhen Shushida Logistics Service Co., Ltd. Shushida Logistics
Beijing Konka Electronic Co., Ltd. Beijing Konka Electronic
Kunshan Jielunte Mould Plastic Co. , Ltd. Kunshan Jielunte
Wuhan Jielunte Mould Plastic Co. , Ltd. Wuhan Jielunte
Chuzhou Jielunte Mould Plastic Co. , Ltd. Chuzhou Jielunte
V. Main accounting policies, accounting estimates and early errors
1. Basis for the preparation of financial statements
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With the going-concern assumption as the basis, the Group prepared its financial
statements in light of the actual transactions and events, as well as the Basic
Standard and 38 specific standards of Accounting Standards for Business Enterprises
issued by the Ministry of Finance of the PRC on 15 Feb. 2006, the Application Guidance
of Accounting Standards for Business Enterprises, the Interpretation of Accounting
Standards for Business Enterprises and other regulations issued thereafter (jointly
referred to as “the Accounting Standards for Business Enterprises”), and the Rules
for Preparation Convention of Disclosure of Public Offering Companies No.15—General
Regulations for Financial Reporting (revised in 2010) by China Securities Regulatory
Commission (CSRC).
In accordance with the Accounting Standards for Business Enterprises, accounting
activities of the Group were conducted on the accrual basis. Except for some financial
instruments, the financial statements were prepared on the basis of historical costs.
Where impairment occurred in an asset, the corresponding impairment provision was
withdrawn according to relevant rules.
2. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements for the first half of 2014 prepared by the Group are in
compliance with the requirements of the Accounting Standards for Business
Enterprises, factually and completely presenting the Company’s and the Group’s
financial positions as at 30 Jun. 2014, and operating results, cash flows and other
relevant information for the six months then ended. Furthermore, these financial
statements, in all material respects, are also in line with relevant disclosure
requirements for financial statements and notes thereof stipulated in the Rules for
Preparation Convention of Disclosure of Public Offering Companies No.15—General
Regulations for Financial Reporting (revised in 2010) by CSRC.
3. Fiscal period
The Group’s accounting periods are divided into annual periods (yearly) and interim
periods. The interim period is a reporting period which is shorter than a full fiscal
year. Gregorian calendar is adopted for fiscal year of the Company, namely from 1
Jan. to 31 Dec. every year.
4. Recording currency
Renminbi (RMB) is the prevailing currency used in the main economic circumstances
of the Company and its domestic subsidiaries. The Company and its domestic
subsidiaries adopt RMB as the recording currency. When preparing the financial
statements, the Group adopted RMB as the recording currency.
5. Accounting methods for business combinations under the same control and not under
the same control
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(1) Business combinations under the same control
A business combination refers to a transaction or event bringing together two or
more separate enterprises into one reporting entity. Business combinations are
divided into business combinations under the same control and those not under the
same control.
Business combinations under the same control
A business combination under the same control is a business combination in which
all the enterprises involved in the combination are ultimately controlled by the
same party or parties both before and after the business combination and on which
the control is not temporary. In a business combination under the same control, the
party which obtains control of other enterprise(s) involved in the business
combination on the combining date is the combining party, and the other enterprise(s)
involved in the business combination is (are) the combined party. The "combining
date" refers to the date on which the combining party obtains actual control on the
combined party.
The assets and liabilities that the combining party obtains in a business combination
shall be measured on the basis of their carrying amount in the combined party on
the combining date. As for the balance between the carrying amount of the net assets
obtained by the combining party and the carrying amount of the consideration paid
by it (or the total par value of the shares issued), the additional paid-in capital
shall be adjusted. If the additional paid-in capital is not sufficient to be offset,
the retained earnings shall be adjusted.
The direct cost for the business combination of the combining party shall be recorded
into the profits and losses at the current period.
(2) Business combinations not under the same control
A business combination not under the same control is a business combination in which
the combining enterprises are not ultimately controlled by the same party or the
same parties both before and after the business combination. In a business
combination not under the same control, the party which obtains the control on other
combining enterprise(s) on the purchase date is the acquirer, and other combining
enterprise(s) is (are) the acquiree. The "acquisition date" refers to the date on
which the acquirer actually obtains the control on the acquiree.
As for business combinations not under the same control, the combination costs shall
be the fair values, on the acquisition date, of the assets paid, the liabilities
incurred or assumed and the equity securities issued by the acquirer in exchange
for the control on the acquiree, and intermediary agency fees for auditing, legal,
consulting services, etc. and other administrative expenditures incurred for the
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business combination, which were recorded in the profits and losses at the current
period when incurred. The trading expenditures arising from the acquirer’s issuance
of equity or liabilities securities as the consideration for the business combination
are recorded in the initial recognition amount for the equity or liabilities
securities. The contingent consideration involved is recorded in the combination
costs according to its fair value on the acquisition date. Where new or further
evidence against the existing circumstances on the acquisition date occurs within
12 months after the acquisition date, which makes it necessary to adjust the
contingent consideration, the combined business reputation is adjusted accordingly.
For a business combination realized by two or more transactions of exchange, in the
Group’s consolidated financial statements, as for the equity interests of the
acquiree held by the Group before the acquisition date, they are re-measured
according to their fair value on the acquisition date. The difference between their
fair value and their carrying amount is recorded in investment gains for the period
comprising the acquisition date. Other comprehensive incomes arising from the equity
interests of the acquiree held by the Group before the acquisition date are
transferred to investment gains at the current period. The combination costs are
the summation of the fair value on the acquisition date of the equity interests of
the acquiree held by the Group before the acquisition date and the fair value on
the acquisition date of the equity interests of the acquiree acquired by the Group
on the acquisition date.
The combination costs of the acquirer and the identifiable net assets obtained in
the combination are both measured at their fair values on the acquisition date. The
positive balance between the combination costs and the fair value of the identifiable
net assets the acquirer obtains from the acquiree is recognized as business
reputation. The acquirer shall, pursuant to the following provisions, treat the
balance between the combination costs and the fair value of the identifiable net
assets it obtains from the acquiree: a. it shall reexamine the measurement of the
fair values of the identifiable assets, liabilities and contingent liabilities it
obtains from the acquiree as well as the combination costs; b. if, after the
reexamination, the combination costs are still less than the fair value of the
identifiable net assets it obtains from the acquiree, it shall record the balance
into the profits and losses of the current period.
As for the unrecognized deductible temporary differences of the acquiree obtained
by the acquirer due to their not satisfying the recognition criteria for deferred
income tax assets on the acquisition date, if new or further information within 12
months after the acquisition date shows that the relevant circumstances on the
acquisition date has existed and that the economic benefits arising from the
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deductible temporary differences of the acquiree on the acquisition date are expected
to be realized, the corresponding deferred income tax assets are recognized and the
business reputation is written down in the mean time. If the business reputation
is not sufficient to offset, the difference is recognized in the profits and losses
at the current period. Except for the aforesaid circumstance, the recognized deferred
income tax assets in relation to the business combination are recorded in the profits
and losses at the current period.
6. Detailed accounting policies of equity disposal by stages to control loss
(1) Principle of judgment of “package deal”
The non-controlled enterprise merger of transactions by stages, according to Notice
about Ministry of Finance Releasing Enterprise Accounting Standards Explanation No.5
(CK [2012]19) for the criteria judgment of “package deal” (refer to note 4 and
5) to judge whether several transactions are part of “package deal”.
(2) Accounting treatment methods of “package deal”
Any transactions of “package deal”should be handled according to former description
of this part and Note 4, 13 Long-term Equity Investment.
(3) Accounting treatment methods of non “package deal”
Any transactions not belonging to “package deal”, it should be handled according
to individual financial report or consolidated financial report:
In individual financial report, the sum of book value of Buyer’s equity investment
held before purchase date and new investment costs on purchase data should be regarded
as the initial investment costs. Stock equity held by acquiree before purchase date
involving other comprehensive income should transfer in current investment income
together with other comprehensive income when disposing the investment.
In consolidated financial report, the stock equity hold by acquiree before purchase
date should be revalued by fair value on purchase date. Difference of fair value
and book value should transfer in current investment income. Stock equity hold by
acquiree before purchase date involving other comprehensive income and other
comprehensive income should transfer in current investment income of the purchase
date.
7. Preparation of consolidated financial statements
(1) Preparation of consolidated financial statements
(1) Ascertainment of the consolidation scope
The scope of consolidated financial statements shall be confirmed based on the
control. Control means the Company can decide the financial and manage policy of
investee entity and have authority to earn the benefit from the investee entity.
The consolidation scope includes the Company and all its subsidiaries. The Company’
s subsidiaries refer to the enterprises or entities controlled by the Company.
(2) Preparation methods for consolidated financial statements
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The Group consolidates a subsidiary from the date when the Group obtains actual
control over the subsidiary ’ s net assets and production and operation
decision-making and de-consolidates it from the date when such control ceases. As
for a disposed subsidiary, its operating results and cash flows before the disposal
date are properly included in the consolidated income statement and the consolidated
cash flow statement. As for a subsidiary disposed in the current period, the opening
accounts in the consolidated balance sheet are not restated. For a subsidiary
acquired in a business combination not under the same control, its operating results
and cash flows after the acquisition date are properly included in the consolidated
income statement and the consolidated cash flow statement, and the opening accounts
and comparative accounts in the consolidated financial statements are not restated.
For a subsidiary acquired in a business combination under the same control or a merged
party under merge and consolidation, its operating results and cash flows for the
period from the beginning of the reporting period to the combination date are properly
included in the consolidated income statement and the consolidated cash flow
statement, and the comparative accounts in the consolidated financial statements
are restated in the mean time.
In the preparation of the consolidated financial statements, where a subsidiary
adopts different accounting policies or accounting periods from those of the Company,
the subsidiary’s financial statements are adjusted according to the Company’s
accounting policy and accounting periods. For a subsidiary obtained in a business
combination not under the same control, its financial statements are adjusted on
the basis of the fair value of its identifiable net assets on the acquisition date.
All significant balances, transactions and unrealized profits within the Group are
offset in the preparation of the consolidated financial statements.
The portions in a subsidiary’s shareholders’ equity and net current profits and
losses that are not attributable to the Company are separately presented, as minority
interests and minority shareholder gains and losses respectively, under the
shareholders’ equity item and the net profit item in the consolidated financial
statements. The portion in the subsidiary’s current net gains and losses that belongs
to minority interests is presented as “minority shareholder gains and losses” under
the net profit item in the consolidated income statement. Where the subsidiary’
s losses attributable to minority shareholders exceed the portion in the subsidiary’
s opening owners’ equity attributable to minority shareholders, minority interests
are offset.
Where the Company loses control over a former subsidiary due to disposal of some
equity investment or other reasons, the residual equity interests are re-measured
according to the fair value on the date when such control ceases. The summation of
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the consideration obtained from the equity disposal and the fair value of the residual
equity interests, minus the portion in the former subsidiary’s net assets measured
on a continuous basis from the acquisition date that is attributable to the Company
according to its former shareholding ratio in the subsidiary, is recorded in the
investment gains for the reporting period when the Company’s control over the
subsidiary ceases. Other comprehensive incomes in relation to the former equity
investment in the subsidiary are transferred to the investment gains at the current
period when the Company’s control over the subsidiary ceases. Later on, subsequent
measurement is carried out on the residual equity interests in accordance with the
“Accounting Standards for Business Enterprises No.2—Long-term Equity Investment”
or the “ Accounting Standards for Business Enterprises No.22 — Recognition and
Measurement of Financial Instruments” and other relevant regulations. For more
details, please refer to “12. Long-term Equity Investment” or “9. Financial
Instruments” under the Note IV.
If the Company disposes the equity investment of subsidiaries by stages until rights
of control are lost, it should handle all transactions of equity investment of
subsidiaries until control rights lost by distinguishing whether it belongs to
package deal. If the terms, conditions or economic impact of transactions of equity
investment of subsidiaries comply with one or more conditions, the transactions would
be handled as package deal: ① transactions are concluded considering the influences;
② transactions achieve integrated commercial results as a whole; ③ occurrence of
one transaction depends on other transactions; ④ one transaction is not economic
independently but economic with other transactions. Non package deal transaction
should be handled according to “ Partial Disposal of Long-term Equity Right
Investment without Losing the Controlling Rights ” (Note IV, 13) and “Losing
Controlling Rights of Original Subsidiaries Due to Handling Partial Equity
Investment or other Reasons”. If the transactions of handling equity investment
of subsidiaries and losing controlling rights are package deal, the transactions
should be handled with accounts as that of subsidiaries losing controlling rights.
However, difference of disposing price payment and shares of net assets of
subsidiaries of disposing investment before losing controlling rights, other
comprehensive income in consolidated financial report should transfer in current
profits and losses of losing controlling rights.
(2) If stock rights of the same subsidiary have been bought and sold in two continuous
accounting years, or sold and bought, accounting treatment methods should be
published.
There was no stock right belonging to the same subsidiary have been bought and sold
in two continuous accounting years, or sold and bought.
8. Recognition standard for cash and cash equivalents
The term “cash” refers to cash on hand and deposits that are available for payment
at any time. The term “cash equivalents” refers to short-term (within 3 months
from the purchase date) and highly liquid investments that are readily convertible
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to known amounts of cash and which are subject to an insignificant risk of change
in value.
9. Foreign currency businesses and translation of foreign currency financial
statements
(1) Foreign currency transaction
(1) Translation of foreign currency transactions
At the time of initial recognition of a foreign currency transaction, the Group shall
convert the amount in a foreign currency into amount in its Renminbi at the spot
exchange rate (generally refer to the middle price of market exchange rate published
by the People’s Bank of China, the same below) on the day the transaction is occurred.
Of which, as for such transactions as foreign exchange or involving in foreign
exchange, the Company shall converted into amount in the Renminbi at actual exchange
rate the transaction is occurred.
(2) Treatment method for the foreign currency monetary items and foreign currency
non-monetary items:
On the balance sheet date, the foreign currency monetary items are translated at
the spot exchange rate on the date. Exchange differences are recorded in the profits
and losses at the current period except for the following circumstances: ① Exchange
differences arising from the special foreign currency borrowings for the acquisition
and construction of assets eligible for capitalization are treated in accordance
with the principle of borrowing cost capitalization; ② Exchange differences
arising from the net investment hedging instruments in an overseas operation are
recorded in other comprehensive incomes and can be recognized in the profits and
losses at the current period only when the net investment is disposed (the balance
was recorded into other comprehensive income, or current profits and losses until
the net investment being disposed); and ③ Exchange differences arising from changes
in the carrying balances other than the amortized costs of foreign currency monetary
items available for sale are recorded in other comprehensive incomes.
Foreign currency non-monetary items measured at historical costs are translated into
RMB at the spot exchange rate on the transaction date. The foreign currency
non-monetary items measured at the fair value are translated at the spot exchange
rate on the fair value confirming date, from which the exchange difference is treated
as change in fair value (including change in exchange rate) and recorded in the profit
and loss of the current period, or treated as other comprehensive incomes and recorded
in the capital reserves.
(2) Translation of foreign currency financial statements
Where the consolidated financial statements involve an overseas operation and
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foreign currency monetary items form in a substantial basis on the net investment
in the overseas operation, exchange differences arising from exchange rate changes
are recorded in the “translation difference of foreign currency statements” item
under the owners’equity item; and recorded in the profits and losses at the reporting
period of the disposal when the overseas operation is disposed.
The foreign currency financial statements of an overseas operation are translated
in RMB in accordance with the following methods: The asset and liability items in
the balance sheets shall be translated at a spot exchange rate on the balance sheet
date. Among the owner’s equity items, except the ones as “retained profits”, others
shall be translated at the spot exchange rate at the time when they are incurred.
The income and expense items in the profits statements shall be translated at the
average exchange rate of the current period on transaction date. The opening retained
profit is the closing retained profit as of the previous year after translation;
The closing retained profit is measured and stated according to profit distribution
items after translation; And the difference between the asset items and the summation
of the liability and shareholders ’ equity items after translation, as the
translation difference of foreign currency statements, is recognized in other
comprehensive incomes and is presented separately under the shareholders’ equity
item in the balance sheet. Where an overseas operation is disposed and the Group’
s control on the overseas operation ceases, the foreign currency statement
translation difference in relation to the overseas operation and presented under
the shareholders’ equity items in the balance sheet is, all or according to the
disposal rate of the overseas operation, transferred to the profits and losses at
the reporting period comprising the disposal.
Foreign currency cash flows and cash flows generated by overseas subsidiaries are
translated at the average exchange rate for the current period on the date when the
cash flow is generated. The influence on cash due to change of exchange rate shall
be presented separately under the cash flow statement.
The opening amounts and the actual amounts in the previous year are presented on
the basis of the translated financial statements for the previous year.
10. Financial instruments
(1) Classification of financial instruments
Classification of financial assets
Financial assets in the initial confirmation shall be divided into financial assets
which are calculated by fair value and whose variation shall be reckoned into current
gains and losses, held-to-maturity investment, loads, account receivables and
available-for-sale financial assets.
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Classification of financial liabilities
Financial liabilities in the initial confirmation shall be divided into financial
liabilities which are calculated by fair value and whose variation shall be reckoned
into current gains and losses and other financial liabilities.
(2) Recognition basis and measurement of financial instruments
(a) Recognition basis and measurement of financial instruments
Financial assets bought in and sold out in the conventional way are recognized and
de-recognized in accordance with the transaction dates. In the initial recognition,
financial assets are divided into financial assets measured at fair values and whose
changes are recorded in current profits and losses, held-to-maturity investments,
loans and accounts receivables, and available-for-sale financial assets. In the
initial recognition, a financial asset is measured at its fair value. For a financial
asset measured at fair value and whose changes are recorded in current gains and
losses, the relevant trading expenditures are directly recorded in the gains and
losses at the current period. And the trading expenditures for the other financial
assets are recorded in the initially recognized amount.
① Financial assets measured at fair values and whose changes are recorded in current
profits and losses
Such financial assets include transactional financial assets and financial assets
designated to be measured at fair values and whose changes are recorded in current
gains and losses.
A transactional financial asset refers to a financial asset meeting any of the
following requirements: A. The purpose to acquire the financial asset is mainly for
selling or repurchase of it in the near future; B. Forming a part of the identifiable
combination of financial instruments which are managed in a centralized way and for
which there are objective evidences proving that the Group may manage the combination
by way of short-term profit making in the near future; and C. Being a derivative
instrument, excluding the designated derivative instruments which are effective
hedging instruments, or derivative instruments to financial guarantee contracts,
and the derivative instruments which are connected with the equity instrument
investments for which there is no quoted price in the active market, whose fair value
cannot be reliably measured, and which shall be settled by delivering the said equity
instruments.
Financial asset complying with one of following conditions can be measured at fair
value when being initially recognized and changes in that financial asset are
recorded in gains and losses of the current period: A. The designation can eliminate
or greatly reduce situations where related profits or losses were in inconformity
83
due to different measurement base of the financial asset; B. The formal written
document of concerning risk management or investment strategy of the Group has stated
that the Group shall manage and assess on financial asset group and financial asset
and financial liability group on the basis of fair value, and report to key management
staffs.
A transactional financial asset, which is measured at the fair value and changes
thereof are recorded in gains and losses of the current period, is subsequently
measured at the fair value. The gains and losses arising from the fair value changes,
as well as the dividend and interest incomes from the financial asset, are recorded
in the gains and losses for the current period.
② Held-to-maturity investments
A held-to-maturity investment refers to a non-derivative financial asset with a fixed
date of maturity, a fixed or determinable amount of repo price and which the Group
holds for a definite purpose or the Group is able to hold until its maturity.
A held-to-maturity investment is subsequently measured according to the amortized
cost using the actual interest rate method. The gains or losses arising from
de-recognition, impairment or amortization of the investment are recorded in the
profits and losses for the current period.
The actual interest rate method refers to the method by which the post-amortization
costs and the interest incomes of different installments or interest expenses are
calculated in light of the actual interest rates of the financial assets or financial
liabilities (including a set of financial assets or financial liabilities). The
actual interest rate refers to the interest rate adopted to cash the future cash
flow of a financial asset or financial liability within the predicted term of
existence or within a shorter applicable term into the current carrying amount of
the financial asset or financial liability.
When calculating the actual interest rate, the Group predicts the future cash flow
(not taking into account the future credit losses) on the basis of taking into account
all the contractual provisions concerning the financial asset or financial liability.
The various fee charges, trading expenses, reduced values, premiums, etc., which
are paid or collected by the parties to a financial asset or financial liability
contract and which form a part of the actual interest rate, are also taken into account
in the determination of the actual interest rate.
③ Loans and accounts receivable
Loans and accounts receivable refer to the non-derivative financial assets for which
there is no quoted price in the active market and of which the repo amount is fixed
or determinable. The financial assets defined by the Group as loans and accounts
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receivable include notes receivable, accounts receivable, interest receivable,
dividend receivable, other receivables, etc..
Loans and accounts receivable are subsequently measured according to the amortized
cost using the actual interest rate method. The gains or losses arising from
de-recognition, impairment or amortization of the loans and accounts receivable are
recorded in the profits and losses for the current period.
④ Available-for-sale financial assets
Available-for-sale financial assets include the non-derivative financial assets
which are designated as available for sale when they are initially recognized, as
well as the financial assets other than the financial assets measured at fair values
and whose changes are recorded in current gains and losses, loans and accounts
receivable and held-to-maturity investments.
Available-for-sale financial assets are subsequently measured at their fair values.
Impairment losses and the exchange differences of foreign currency monetary
financial assets in relation to the amortized cost are recorded in the profits and
losses for the current period. Other gains or losses arising from fair value changes
are recognized as other comprehensive incomes and recorded in the capital reserves,
and transferred out and recorded in the profits and losses for the current period
when the financial asset is de-recognized.
Interest obtained during the period of holding an available-for-sale financial asset
and the cash dividends declared and distributed by an invested party are recorded
in investment gains.
(b) Classification and measurement of financial liabilities
In the initial recognition, financial liabilities are divided into the financial
liabilities measured at fair values and whose changes are recorded in current gains
and losses and other financial liabilities. Financial liabilities are initially
recognized at their fair values. As for a financial liability measured at fair value
and whose changes are recorded in current gains and losses, the relevant trading
expense is directly recorded in the profits and losses for the current period. As
for other financial liabilities, the relevant trading expenses are recorded in the
initially recognized amounts.
① Financial liabilities measured at fair values and whose changes are recorded in
current gains and losses
Such financial liabilities are divided into transactional financial liabilities and
financial liabilities designated to be measured at fair values and whose changes
are recorded in current gains and losses in the initial recognition under the same
conditions where such financial assets are divided into transactional financial
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assets and financial assets designated to be measured at fair values and whose changes
are recorded in current gains and losses in the initial recognition.
Financial liabilities measured at fair values and whose changes are recorded in
current gains and losses are subsequently measured at their fair values. Gains or
losses arising from the fair value changes, as well as the dividend and interest
expenses in relation to the said financial liabilities, are recorded in the profits
and losses for the current period.
② Other financial liabilities
As for a derivative financial liability connected to an equity instrument for which
there is not quoted price in an active market and whose fair value cannot be reliably
measured and which must be settled by delivering the equity instrument, it is
subsequently measured on the basis of costs. Other financial liabilities are
subsequently measured according to the amortized cost using the actual interest rate
method. Gains or losses arising from de-recognition or amortizations of the said
financial liabilities are recorded in the profits and losses for the current period.
③ Financial guarantee contract
For the financial guarantee contracts which are not designated as a financial
liability measured at its fair value and the variation thereof is recorded into the
profits and losses of the current period, which shall be initially recognized by
fair value, and the subsequent measurement shall be made after they are initially
recognized according to the higher one of the following: a. the amount as determined
according to the Accounting Standards for Enterprises No. 13 – Contingencies; b.
the surplus after accumulative amortization as determined according to the
principles of the Accounting Standards for Enterprises No. 14 - Revenues is
subtracted from the initially recognized amount.
(c) Derivative instrument and embedded derivative instrument
Derivative instrument shall be initially measured at its fair value on the signing
date for relevant contracts, and made the follow-up measurement at fair value. The
changes in the fair value of the derivative instrument shall be recorded into
gain/loss at current period.
Where a mixed instrument including an embedded derivative instrument fails to be
designated as a financial asset or financial liability measured at its fair value
and of which the variation is included in the current profits and losses, and it
can simultaneously meet the two conditions that there is no close relationship
between it and the principal contract in terms of economic features and risks, as
well as there is no close relationship between it and the principal contract in terms
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of economic features and risks. Then the embedded derivative instrument shall be
separated from the mixed instrument and treated as an independent derivative
instrument. Where it is impossible to make an independent measurement when it is
obtained or subsequently on the balance sheet date, the mixed instrument shall be
designated entirely as a financial asset or financial liability measured at its fair
value and of which the variation is included in the current profits and losses.
(d) The offset of financial assets and financial liabilities
When the Group has the legal right to offset the confirmed financial assets and
financial liabilities, and can execute this legal right now, meanwhile, the Group
plans to settle them at their net amount or realize the financial assets and pay
off the financial liabilities at the same time, the financial assets and financial
liabilities should be listed in the balance sheet by the amount after their offset
with each other. Apart from this, the financial assets and financial liabilities
should be listed in the balance sheet respectively and should not offset with each
other.
(e) Equity instruments
The "equity instruments" refers to the contracts which can prove that the Group holds
the surplus equities of the assets after the deduction of all the debts. For equity
instruments, the consideration received in the issuance of equity instruments after
deducting the transaction cost shall be recorded in the owners’ equity.
The owners’ equity decreased from the Group’s various distributions (excluding
the dividend distribution) to the owners of equity instruments, the Group shall not
make it as the change in the fair value of equity instruments.
(3) Recognition and measurement of financial asset transfers
Where a financial asset satisfies any of the following requirements, the recognition
of it is terminated: ① The contractual rights for collecting the cash flow of the
said financial asset are terminated; ② The said financial asset has been
transferred and nearly all of the risks and rewards related to the ownership of the
financial asset to the transferee; or ③ The said financial asset has been
transferred. And the Group has ceased its control on the said financial asset though
it neither transfers nor retains nearly all of the risks and rewards related to the
ownership of the financial asset.
Where the Group neither transfers nor retains nearly all of the risks and rewards
related to the ownership of a financial asset, and it does not cease its control
on the said financial asset, it recognizes the relevant financial asset and liability
accordingly according to the extent of its continuous involvement in the transferred
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financial asset. The term "continuous involvement in the transferred financial
asset" refers to the risk level that the enterprise faces resulting from the change
of the value of the financial asset.
If the transfer of an entire financial asset satisfies the conditions for stopping
recognition, the difference between the amounts of the following 2 items is recorded
in the profits and losses of the current period: (1) The book value of the transferred
financial asset; and (2) The sum of consideration received from the transfer, and
the accumulative amount of the changes of the fair value originally recorded in other
comprehensive incomes.
If the transfer of partial financial asset satisfies the conditions to stop the
recognition, the book value of the transferred financial asset is apportioned between
the portion whose recognition has been stopped and the portion whose recognition
has not been stopped according to their respective relative fair value, and the
difference between the amounts of the following 2 items is included into the profits
and losses of the current period: (1) The summation of the consideration received
from the transfer and the portion of the accumulative amount of changes in the fair
value originally recorded in other comprehensive incomes which corresponds to the
portion whose recognition has been stopped; and (2) The amortized carrying amounts
of the aforesaid amounts.
(4) De-recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all
or in part may the recognition of the financial liability be terminated in all or
partly. Where the Group (debtor) enters into an agreement with a creditor so as to
substitute the existing financial liabilities by way of any new financial liability,
and if the contractual stipulations regarding the new financial liability is
substantially different from that regarding the existing financial liability, it
terminates the recognition of the existing financial liability, and at the same time
recognizes the new financial liability.
Where the recognition of a financial liability is totally or partially terminated,
the enterprise concerned shall include into the profits and losses of the current
period for the gap between the book value which has been terminated from recognition
and the considerations it has paid (including the non-cash assets it has transferred
out and the new financial liabilities it has assumed)
(5) Ascertainment of fair values of financial assets and liabilities
The “fair value” refers to the amount, at which both parties to a transaction who
are familiar with the condition exchange assets or clear off debts under fair
conditions. As for the financial instrument for which there is an active market,
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the Group determines its fair value using the quoted price in the active market.
The quoted prices in the active market refer to the prices, which are easily available
from the stock exchange, brokers, industry associations, pricing service
institutions, etc. at a fixed term, and which represent the prices at which actually
incurred market transactions are made under fair conditions. Where there is no active
market for a financial instrument, the Group adopts value appraisal techniques to
determine its fair value. The value appraisal techniques mainly include the prices
adopted by the parties, who are familiar with the condition, in the latest market
transaction upon their own free will, the current fair value obtained by referring
to other financial instruments of the same essential nature, the cash flow
capitalization method and the option pricing model, etc.
(6) Impairment testing methods and provision withdrawing methods of financial
assets (excluding account receivables)
For the financial assets other than the financial assets measured at fair values
and whose changes are recorded in current gains and losses, the Group runs a check
on their carrying amounts on every balance sheet date. Where there is any objective
evidence proving that such a financial asset has been impaired, an impairment
provision is made.
The Group carries out a separate impairment test for every financial asset which
is individually significant. As for a financial asset which is individually
insignificant, an impairment test is carried out separately or in the financial asset
group with similar credit risk. Where the financial asset (individually significant
or insignificant) is found not impaired after the separate impairment test, it is
included in the financial asset group with similar credit risk and tested again on
the group basis. Where the impairment loss is recognized for an individual financial
asset, it is not included in the financial asset group with similar credit risk for
an impairment test.
① Impairment of held-to-maturity investments, loans and accounts receivable
Where a financial asset measured on the basis of costs or amortized costs is impaired,
the carrying amount of the said financial asset is written down to the current value
of the predicted future cash flow. The amount written down is recognized as the
impairment loss of the asset and is recorded in the profits and losses for the current
period. Where a financial asset is recognized as having suffered from any impairment
loss, if there is any objective evidence proving that the value of the said financial
asset has been restored, and it is objectively related to the events that occur after
such loss is recognized, the impairment losses as originally recognized are reversed.
The reversed carrying amount of the said financial asset does not exceed the amortized
cost of the said financial asset on the day of reverse under the assumption that
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no provision is made for the impairment.
② Impairment of available-for-sale financial assets
When it judged that the decrease of fair value of the available-for-sale equity
instrument investment is serious and not temporarily after comprehensive considering
relevant factors, it reflected that the available-for-sale equity instrument
investment occurred impairment. Of which, the “serious decline” refers to the
accumulative decline range of the fair value over 20%; while the “non-temporary
decline” refers to the consecutive decline time of the fair value over 12 months.
Where an available-for-sale financial asset is impaired, the accumulative losses
arising from the decrease of the fair value of the capital reserve which is directly
included are transferred out and recorded in the profits and losses for the current
period. The accumulative losses transferred out are the balance obtained from the
initially obtained cost of the said financial asset after deducting the principals
as taken back, the amortized amount, the current fair value and the impairment loss
originally recorded in the profits and losses.
Where the impairment loss has been recognized for an available-for-sale financial
asset, if, within the accounting periods thereafter, there is any objective evidence
proving that the value of the said financial asset has been restored and the
restoration is objectively related to the events that occur after the impairment
loss was recognized, the originally recognized impairment loss is reversed. The
impairment losses on the available-for-sale equity instrument investments are
reversed and recognized as other comprehensive incomes, and the impairment losses
on the available-for-sale liability instruments are reversed and recorded in the
profits and losses for the current period.
The impairment loss incurred to an equity instrument investment for which there is
no quoted price in the active market and whose fair value cannot be reliably measured,
or incurred to a derivative financial asset which is connected with the said equity
instrument investment and which must be settled by delivering the said equity
investment, is not reversed.
(7) Reclassifying undue held-to-maturity investment into available-for-sale
financial assets and illustrating intention or basis of ability to change
There existed not reclassification of undue held-to-maturity investment into
available-for-sale financial assets in the Company.
11. Recognition and withdrawing methods of bad debt provision of accounts
receivables
Receivables include account receivables and other accounts receivables.
(1) Recognition of provision for bad debts:
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The Group shall test the carrying amount of receivables on the balance sheet date.
Where there is any objective evidence proving that such receivables have been
impaired, an impairment provision shall be made.
① debtor has serious financial difficult;
② debtor goes against the contract clause (for instance, breach of faith or overdue
paying interests or principal);
③ debtors has a great probability of bankruptcy or other financial reorganization;
④ other objective evidence proving such accounts receivable has been impaired;
(2) Withdraw method of provision for bad debts
① The recognition criteria and method of individual provision for bad debts of
receivables that are individually significant
The Group recognized the receivables with amount above RMB 20 million and other
receivables above 10 million as receivables with significant single amounts and
withdrawn the provision for bad debts.
The Group made an independent impairment test on receivables with significant single
amounts; the financial assets without impairment by independent impairment test
should be included in financial assets portfolio with similar credit risk to take
the impairment test. Receivables was recognized with impairment should no longer
be included in receivables portfolio with similar credit risk to take the impairment
test.
② The recognition and method of provision for bad debts of receivables by credit
risk portfolio
A. Recognition of credit risk group
Receivables that not individually significant and individually significant but
without impairment by independent impairment test, are grouped on the basis of
similarity and relevance of credit risk. This credit risk usually reflects the
debtor’s ability to repay all the due accounts in accordance with contract for such
assets, which also are related with the measurement on future cash flow of the
examined assets.
(1) Bad debt provision for individual significant accounts receivables
Individual amounts with accounts receivables over
Recognition of individual significant accounts 20 millions, Individual amounts with other
accounts receivables over 10 millions
Individual accounts receivables with significant
Withdrawing method of individual accounts with amounts shall be individually made impairment
significant amounts and individual withdrawn of bad debt test. As for financial assets without impairment
provision after the impairment test, it shall be included
into financial assets groups similar to credit risk
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and made impairment test. As for accounts
receivables affirmed with impairments after the
test, it shall not be included into financial
assets groups similar to credit risk and made
impairment test.
(2) Accounts receivables withdrawn bad debt provision on the basis of groups
Name of group Withdrawing method Recognition basis
Defining group on the basis of accounts receivables
Aging group Aging analyzing method
aging as credit risk
Balance percentage Defining group on the basis of credit risk of whether
Relevant parties group
method the obligator is related to the Group
In the group, withdrawal method for provision for bad debts by aging analysis
√ Applicable □ Inapplicable
Proportion of provision for bad Proportion of provision for bad debts of
Age
debts of accounts receivable other accounts receivable
Within 1 year (including 1
2.00% 2.00%
year, the same below)
1-2 years 5.00% 5.00%
2-3 years 20.00% 20.00%
3-4 years 50.00% 50.00%
4-5 years 50.00% 50.00%
Over 5 years 100.00% 100.00%
In the group, withdrawal method for provision for bad debts by balance percentage
□ Applicable √ Inapplicable
In the group, withdrawal method for provision for bad debts by other methods
□ Applicable √ Inapplicable
Name of group notes
Group related to the Group Without withdrawal
(3) Receivables with insignificant amount but being individually withdrawn the
provision for bad debts
A. Receivables have dispute with the other parties or involving lawsuit
Reason for individual withdrawal of and arbitration;
provision for bad debts B. Receivables have obvious indication showing that the debtors are
likely to fail to perform the duty of repayment.
The Group made independent impairment test on receivables with
Withdrawal methods for bad debts insignificant amount but with the following characteristics, if any
provision objective evidence shows that the accounts receivable has been
impaired, impairment loss shall be recognized on the basis of the gap
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between the current values of the future cash flow lower than its book
value so as to withdraw provision for bad debts.
12. Inventory
(1) Classification
The Group’s inventories are classified as non-property inventories and property
inventories. And the non-property inventories include raw materials, goods in
process; merchandise on hand, goods delivered and circulating materials, etc; while
the property inventories include property in process and finished property, etc.
① The finished property refers to the finished and held-for-sale property.
② The property in process (development costs) refers to the unfinished property
with the development purpose for sale.
(2) Pricing method of outgoing and obtaining inventories
Pricing method: weighted average method
The inventories shall be measured in light of their cost when obtained. The cost
of inventory consists of purchase costs, processing costs and other costs. Inventory
is accounted by weight average method upon receiving and giving. For merchandise
on hand shall be accounted by planned cost, if the difference between planned cost
of and actual cost of raw materials is accounted through the cost variance item,
and the planned cost is adjusted to the actual cost according to the cost difference
which the carryover and given-out inventory should shoulder in the period.
The property inventories are initially measured at the costs, and the costs of the
developed property include the land premium, expenditures for supporting
infrastructures, expenditures for construction and installation projects, the
borrowing costs before the completion of the developed project and other expenses
occurred during the development process.
① The public supporting facilities recorded the development costs at the actual
costs, the amortization upon completion was transferred to the costs of houses and
other available-for-sale property, while as for the supporting facilities with
operating value and beneficiary rights owned by the Group as well as available for
individual sale and measurement, which shall be recorded into the “investment
property”.
② For the accounting policies on borrowing costs occurred for developing property,
please refer to Note V. 17 in the eighth chapter “Pricing of borrowing Costs”.
(3) Recognition standard of net realizable value and withdrawal method of
depreciation reserves for inventories
The net realizable value refers, in the ordinary course of business, to the account
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after deducting the estimated cost of completion, estimated sale expense and relevant
taxes from the estimated sale price of inventories. The net realizable value of
inventories shall be fixed on the basis of valid evidence as well as under
consideration of purpose of inventories and the effect of events after
balance-sheet-date.
On the balance sheet date, the inventories shall be measured according to the cost
or the net realizable value, whichever is lower. If the net realizable value is lower
than the cost, it shall withdraw the depreciation reserves for inventories, which
was withdrawn in accordance with the balance that the cost of individual inventory
item exceeding the net realizable value.
After withdrawing the depreciation reserves for inventories, if the factors, which
cause any write-down of the inventories, have disappeared, causing the net realizable
value of inventories is higher than its carrying amount; the amount of write-down
shall be reversed from the original amount of depreciation reserve for inventories.
The reversed amount shall be included in the profits and losses of the current period.
(4) Inventory system for inventories
Inventory system for inventories: Perpetual inventory system
(5) Amortization method of the low-value consumption goods and packing articles
Low-value consumption goods:
Amortization method: one-off amortization method
Packing articles
Amortization method: one-off amortization method
The Company shall amortize the low-value consumption goods and packing through the
one-off amortization method.
13. Long-term equity investment
(1) Recognition of investment cost
The initial cost of the long-term equity investment formed in business combination
shall be ascertained in accordance with the following provisions: For the business
combination under the same control, it shall regard the share of the carrying amount
of the owner's equity of the combined party on the date of combination as the initial
cost of the long-term equity investment. For the business combination under different
control, the combination costs shall be the sum of the fair values of the assets
paid, the liabilities incurred or assumed and the equity securities issued by the
Company; the commission fees for audit, law services, assessment & consultancy
services and other relevant expenses occurred in the business combination by the
combining party, shall be recorded into current profits and losses upon their
occurrence; the transaction expense from the issuance of equity securities or bonds
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securities which are as consideration for combination by the combining party, should
be recorded as the initial amount of equity securities and bonds securities.
Besides the long-term equity investments formed by business combination, the other
long-term equity investments shall be initially measured by cost, the cost is fixed
in accordance with the ways of gaining, such as actual cash payment paid by the Group,
the fair value of equity securities issued by the Group, the agreed value of the
investment contract or agreement, the fair value or original carrying amount of
exchanged assets from non-monetary assets exchange transaction, the fair value of
the long-term equity investments, etc. The expenses, taxes and other necessary
expenditures directly related with gaining the long-term equity investments shall
also be recorded into investment cost.
(2) Follow-up measurement of long-term equity investment and recognized method of
profits and losses
The long-term equity investment that the Company does not have joint control or
significant influences on the invested entity, and has no offer in the active market
and its fair value cannot be reliably measured, it shall be measured by adopting
the cost method; a long-term equity investment that the Company has joint control
or significant influences over the invested entity shall be measured by employing
the equity method; a long-term equity investment that the Company does not have
control, joint control or significant influence on the invested entity, as well as
its fair value can be reliably measured, it shall be accounted as financial assets
available-for-sale.
Moreover, long-term equity investment adopting the cost method in the financial
statements, and which the Company has control on invested entity.
① Long-term equity investment measured by adopting cost method
The price of a long-term equity investment measured by adopting the cost method shall
be included at its initial investment cost, the return on investment at current period
shall be recognized in accordance with the cash dividend or profit announced to
distribute by the invested entity, except the announced but not distributed cash
dividend or profit included in the actual payment or consideration upon gaining the
investment.
②Long-term equity investment measured by adopting equity method
If the initial cost of a long-term equity investment is more than the Company's
attributable share of the fair value of the invested entity's identifiable net assets
for the investment, the initial cost of the long-term equity investment may not be
adjusted. If the initial cost of a long-term equity investment is less than the
Company's attributable share of the fair value of the invested entity's identifiable
net assets for the investment, the difference shall be included in the current profits
and losses and the cost of the long-term equity investment shall be adjusted
simultaneously.
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When measured by adopting equity method, the investment profits or losses at current
period shall be the attributable share of the net profits or losses of the invested
entity. The investing enterprise shall, on the ground of the fair value of all
identifiable assets of the invested entity when it obtains the investment, and in
accordance with the accounting policies and accounting periods, recognize the
attributable share of the net profits and losses of the invested entity after it
adjusts the net profits of the invested entity. For the profits and losses of
unrealized insider dealing between the Group and joint-operative enterprise or
co-operative enterprise, the investment profits and losses shall be recognized after
the part attributable to the Group calculated by proportion of shares held being
offset. However, if the losses of unrealized insider dealing between the Group and
joint-operative enterprise or co-operative enterprise was attributed to the
impairment losses of the transferred assets in accordance with the Accounting
Standards for Enterprises No. 8— Asset Impairment, which shall not be offset. The
other comprehensive profits from invested entity shall be recognized as other
comprehensive profits after adjusting the book value of long-term equity investment,
and then recorded into capital reserves
The Group shall recognize the net losses of the invested enterprise until the book
value of the long-term equity investment and other long-term rights and interests
which substantially form the net investment made to the invested entity are reduced
to zero. However, if the Group has the obligation to undertake extra losses, it shall
be recognized as the estimated liabilities in accordance with the estimated duties
and then recorded into investment losses at current period. If the invested entity
realizes any net profits later, the Group shall, after the amount of its attributable
share of profits offsets against its attributable share of the un-recognized losses,
resume recognition of its attributable share of profits.
For the long-term equity investment on joint-enterprise and co-operative enterprise
held by the Group before the initial execution of New Accounting Standards for
Enterprise, if there existed the balance of debtor for equity investment related
with such long-term equity investment, which shall be recorded into current profits
and losses with the amount by straight-line amortization in the remained period.
③ Acquiring shares of minority interest
In the preparation for the financial statements, the balance existed between the
long-term equity investment increased by acquiring shares of minority interest and
the attributable net assets on the subsidiary calculated by the increased shares
held since the purchase date (or combination date), the capital reserves shall be
adjusted, if the capital reserves are not sufficient to offset, the retained profits
shall be adjusted.
④ Disposal of long-term equity investment
In the preparation of financial statements, the Company disposed part of the
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long-term equity investment on subsidiaries without losing its controlling right
on them, the balance between the disposed price and attributable net assets of
subsidiaries by disposing the long-term equity investment shall be recorded into
owners’ equity; where the Company losses the controlling right by disposing part
of long-term equity investment on such subsidiaries, it shall treated in accordance
with the relevant accounting policies in Note IV. 7 “Method on preparation of
combined financial statements”.
For other ways on disposal of long-term equity investment, the balance between the
book value of the disposed equity and its actual payment gained shall be recorded
into current profits and losses; for the long-term equity investment measured by
adopting equity method, the other comprehensive income originally recorded into
owners’ equity shall be transferred into current profits and losses by proportions
upon the disposal. The remained equity shall be recognized as long-term equity
investment or other relevant financial assets in accordance with the book value,
and carried out the follow-up measurement in accordance with the above accounting
policies for the long-term equity investment or financial assets. If the measurement
method of remained equity is transferred from cost method to equity method, it shall
be subject to retrospective adjustment in accordance with relevant rules and
stipulations.
(3) Recognition basis of joint control and significant influences
The term "control" refers to the power to determine the financial and operating
polices of an enterprise and obtain benefits from its operating activities of the
enterprise. The term "joint control" refers to the control over an economic activity
in accordance with the contracts and agreements, which does not exist unless the
investing parties of the economic activity with one an assent on sharing the control
power over the relevant important financial and operating decisions. The term
"significant influences" refers to the power to participate in making decisions on
the financial and operating policies of an enterprise, but not to control or do joint
control together with other parties over the formulation of these policies. When
ascertaining whether or not it is able to control or have significant influences
on an invested entity, an enterprise shall take into consideration the invested
enterprises' current convertible corporate bonds and current executable warrants
held by the investing enterprise and other parties, as well as other potential factors
concerning the voting rights.
(4) Testing method of impairment and withdrawal method of provision for impairment
The Group shall, on the day of balance sheet, make a judgment on whether there is
any sign of possible impairment of the long-term equity investment. Where there is
sign of impairment, the Group shall estimate the recoverable amount of the long-term
equity investment. Where the recoverable amount of the long-term equity investment
is lower than its book value, which balance shall be withdrawn the provision for
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impairment and recorded into current profits and losses.
Once any loss of impairment of the long-term equity investment is recognized, it
shall not be switched back in the future accounting periods.
14. Investment real estates
The term "investment real estates" refers to the real estates held for generating
rent and/or capital appreciation. Investment real estates of the Group include the
right to use any land which has already been rented; the right to use any land which
is held and prepared for transfer after appreciation; and the right to use any
building which has already been rented. Besides, as for the vacant buildings held
for operating lease, if the Board (or similar institution) made a written resolution,
and clearly expressed to hold it as operating lease with no change in the short time,
which shall be listed as investment real estates.
The initial measurement of the investment real estate shall be made at its cost.
Subsequent expenditures incurred for an investment real estate is included in the
cost of the investment real estate when it is probable that economic benefits
associated with the investment real estate will flow to the Group and the cost can
be reliably measured, otherwise the expenditure is recognized in profit or loss in
the period in which they are incurred.
The Group shall make a follow-up measurement to the investment real estates by
employing the cost pattern on the date of the balance sheet. An accrual depreciation
or amortization shall be made for the investment real estates in the light of the
accounting policies of the use right of buildings or lands.
For details of impairment test method and withdrawal method of impairment provision
of investment real estates, please refer to Note IV. 35 in the eighth chapter
“Impairment of Non-current Non-financial Assets”.
When owner-occupied real estate or inventories are changed into investment real
estate or investment real estate is changed into owner-occupied real estate, whose
book value prior to the change shall be the entry value after the change.
When an investment real estate is changed to an owner-occupied real estate, it is
transferred to fixed assets or intangible assets at the date of such change. When
an owner-occupied real estate is changed to be held to earn rental or for capital
appreciation, the fixed asset or intangible asset is transferred to investment real
estate at the date of such change. If the fixed asset or intangible asset is changed
into investment real estate measured by adopting the cost pattern, whose book value
prior to the change shall be the entry value after the change; if the fixed asset
or intangible asset is changed into investment real estate measured by adopting the
fair value pattern, whose fair value on the date of such change shall be the entry
value after the change
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An investment real estate is derecognized on disposal or when the investment real
estate is permanently withdrawn from use and no future economic benefits are expected
from its disposal. The amount of proceeds on sale, transfer, retirement or damage
of an investment real estate less its carrying amount and related taxes and expenses
is recognized in profit or loss in the period in which it is incurred.
15. Fixed assets
(1) Recognized standard of fixed assets
The term "fixed assets" refers to the tangible assets that simultaneously possess
the features as follows: they 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.
(2) Recognition basis and pricing method of fixed assets by finance lease
The "finance lease" shall refer to a lease that has transferred in substance all
the risks and rewards related to the ownership of an asset. Its ownership may or
may not eventually be transferred. The fixed assets by finance lease shall adopt
the same depreciation policy for self-owned fixed assets. If it is reasonable to
be certain that the lessee will obtain the ownership of the leased asset when the
lease term expires, the leased asset shall be fully depreciated over its useful life.
If it is not reasonable to be certain that the lessee will obtain the ownership of
the leased asset at the expiry of the lease term, the leased asset shall be fully
depreciated over the shorter one of the lease term or its useful life.
(3) Category of fixed assets and depreciation
The initial measurement of a fixed asset shall be made at its cost after considering
the effect of expected discard expenses. The Group shall withdraw the depreciation
of fixed assets by adopting the straight-line method since the second month of its
useful life. Useful life, expected net salvage value and annual depreciation rate
of each fixed assets are as below:
Expected net salvage
Category of fixed assets Useful life (Y) value Annual deprecation rate
Housing and building 20-40 10.00% 2.25-4.50
Machinery equipments 10 10.00% 9.00
Transportation vehicle 5 10.00% 18.00
Electronic equipments 5 10.00% 18.00
Other equipments 5 10.00% 18.00
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(4) Testing method of impairment and withdrawal method of provision for impairment
on fixed assets
For details, please refer to Note IV. 35 in the eighth chapter “Impairment of
non-current non financial assets”
(5) Other explanations
The follow-up expenses related to a fixed asset, if the economic benefits pertinent
to this fixed asset are likely to flow into the enterprise and its cost can be reliably
measured, shall be recorded into cost of fixed assets and ultimately recognized as
the book value of the replaced part; otherwise, they shall be included in the current
profits and losses.
When the Group sells, transfers or discards any fixed assets, or when any fixed assets
of the Group is damaged or destroyed, the Group shall deduct the book value of the
fixed assets as well as the relevant taxes from the disposal income, and include
the amount in the current profits and losses.
The Group shall check the useful life, expected net salvage value and depreciation
method of the fixed assets at the end of the year at least, if there is any change,
it shall be regarded as a change of the accounting estimates.
16. Construction in progress
(1) Classification
Construction in progress is measured at actual cost. Actual cost comprises
construction costs, borrowing costs that are eligible for capitalization before the
fixed assets being ready for their intended us and other relevant costs.
(2) Standard and time-point of transformation of construction in progress into fixed
assets
Construction in progress is transferred to fixed assets when the assets are ready
for their intended use.
(3) Testing method and provision withdrawal method for impairment of construction
in progress
For details of the testing method of impairment and withdraw method of impairment
provision on construction in progress, please refer to Note IV. 35 in the Eighth
chapter “Impairment of non-current non financial assets”.
17. Borrowing costs
(1) Recognition basis of capitalized borrowing costs
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The borrowing costs shall include interest on borrowings, amortization of discounts
or premiums on borrowings, ancillary expenses, and exchange balance on foreign
currency borrowings. If borrowing costs meet the following three conditions
simultaneously, it shall be capitalized:
① Expenditures have happened;
② Borrowing costs have happened;
③ Necessary constructions or activities in order to make assets reaching expected
usable or salable stage have happened.
(2) Period of capitalized borrowing costs
Where the borrowing costs incurred to an enterprise can be directly attributable
to the acquisition and construction or production of assets eligible for
capitalization, it shall start to be capitalized when the asset disbursements have
already incurred, the borrowing costs has already incurred and the acquisition and
construction or production activities which are necessary to prepare the asset for
its intended use or sale have already started; When the qualified asset under
acquisition and construction or production is ready for the intended use or sale,
it shall stop to be capitalized. Other borrowing costs shall be recognized as costs
upon their occurrence.
(3) Period of suspension of capitalization
Where the acquisition and construction or production of a qualified asset is
interrupted abnormally and the interruption period lasts for more than 3 months,
the capitalization of the borrowing costs shall be suspended until the acquisition
and construction or production of a qualified asset resume again.
(4) Calculating method of amounts of capitalized borrowing costs
The to-be-capitalized amount of interests shall be determined in light of the actual
interests incurred of the specially borrowed loan at the present period minus the
income of interests earned on the unused borrowing loans as a deposit in the bank
or as a temporary investment; the enterprise shall calculate and determine the
to-be-capitalized amount on the general borrowing by multiplying the weighted
average asset disbursement of the part of the accumulative asset disbursements minus
the general borrowing by the capitalization rate of the general borrowing used. The
capitalization rate shall be calculated and determined in light of the weighted
average interest rate of the general borrowing.
18. Biological assets
19. Oil and gas assets
20. Intangible assets
(1) Intangible assets
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The term "intangible asset" refers to the identifiable non-monetary assets possessed
or controlled by enterprises which have no physical shape.
The intangible assets shall be initially measured according to its cost. The costs
related with the intangible assets, if the economic benefits related to intangible
assets are likely to flow into the enterprise and the cost of intangible assets can
be measured reliably, shall be recorded into the costs of intangible assets;
otherwise, it shall be recorded into current profits and losses upon the occurrence.
The use right of land gained is usually measured as intangible assets. For the
self-developed and constructed factories and other constructions, the related
expenditures on use right of land and construction costs shall be respectively
measured as intangible assets and fixed assets. For the purchased houses and
buildings, the related payment shall be distributed into the payment for use right
of land and the payment for buildings, if it is difficult to be distributed, the
whole payment shall be treated as fixed assets.
For intangible assets with a finite service life, from the time when it is available
for use, the cost after deducting the sum of the expected salvage value and the
accumulated impairment provision shall be amortized by straight line method during
the service life. While the intangible assets without certain service life shall
not be amortized.
(2) Life estimation of intangible assets with finite life
At the end of period, the Group shall check the service life and amortization method
of intangible assets with finite service life, if there is any change, it shall be
regarded as a change of the accounting estimates. Besides, the Group shall check
the service life of intangible assets without certain service life, if there is any
evidence showing that the period of intangible assets to bring the economic benefits
to the enterprise can be prospected, it shall be estimated the service life and
amortized in accordance with the amortization policies for intangible assets with
finite service life.
Item Estimated useful life Basis
Domestic trade mark
5 years Validity of trade mark registration
registration fee
Patent and proprietary
5-10 years Benefit period of patent and proprietary technology
technology
Software and others 5-10 years Benefit period of assets
Land usage right 50 years Usage life of land
(3) Recognition basis of intangible assets with indefinite life
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Judging from available situation, if there is any intangible asset with unambiguous
evidence that the usage life of intangible assets can’t be estimated, it shall be
defined as intangible assets with indefinite life.
(4) Withdrawal method of impairment provision for intangible assets
For details, please refer to Note IV. 35 in the Eighth chapter “Impairment of
non-current non financial assets”.
(5) Standard of dividing research stage and development stage of internal R&D
project of the Company
Research stage: Research is planned investigation with a intention to obtain new
technology and knowledge, including activities to obtain knowledge; research
achievement or research, evaluation of the appliance and ultimate choice of other
knowledge; research of materials, devices, products, processes, systems or
substitutes of services; configuration, design, evaluation and ultimate choice of
new or modified materials, devices, products, processes, systems or substitutes of
services.
Development stage: Development refers to application of research achievements or
other knowledge in a plan or design before commercial production or usage in order
to produce new or substantially modified materials, devices and products, etc.
(6) Expenditures for research and development
The expenditures for its internal research and development projects of the Company
shall be classified into research expenditures and development expenditures.
Expenditures for research and development shall be recorded into current profits
and losses upon the occurrence.
The development expenditures for its internal research and development projects of
an enterprise may be confirmed as intangible assets when they satisfy the following
conditions simultaneously, otherwise，it shall be recorded into current profits and
losses.
① It is feasible technically to finish intangible assets for use or sale;
② It is intended to finish and use or sell the intangible assets;
③ The usefulness of methods for intangible assets to generate economic benefits
shall be proved, including being able to prove that there is a potential market for
the products manufactured by applying the intangible assets or there is a potential
market for the intangible assets itself or the intangible assets will be used
internally;
④ It is able to finish the development of the intangible assets, and able to use
or sell the intangible assets, with the support of sufficient technologies, financial
resources and other resources;
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⑤ The development expenditures of the intangible assets can be reliably measured.
If the expenditures for research and expenditures for development can not be
distinguished from each other, all the expenditures for research and development
shall be recorded into current profits and losses.
21. Long-term deferred expenses
Long-term deferred expenses refer to general expenses with the apportioned period
over one year (one year excluded) that have occurred but attributable to the current
and future periods. Long-term deferred expense shall be amortized averagely within
benefit period.
22. Assets transference with counter purchase conditions
23. Estimated liabilities
(1) Recognition basis of estimated liabilities
The obligation pertinent to a Contingencies shall be recognized as an estimated
liability when the following conditions are satisfied simultaneously: (1) That
obligation is a current obligation of the enterprise; (2) It is likely to cause any
economic benefit to flow out of the enterprise as a result of performance of the
obligation; and (3) The amount of the obligation can be measured in a reliable way.
(2) Calculating method of estimated liabilities
On the balance sheet date, an enterprise shall take into full consideration of the
risks, uncertainty, time value of money, and other factors pertinent to the
Contingencies to measure the estimated liabilities in accordance with the best
estimate of the necessary expenses for the performance of the current obligation.
When all or some of the expenses necessary for the liquidation of an estimated
liabilities of an enterprise is expected to be compensated by a third party, the
compensation should be separately recognized as an asset only when it is virtually
certain that the reimbursement will be obtained. Besides, the amount recognized for
the reimbursement should not exceed the book value of the estimated liabilities.
24. Stock payment and equity instrument
(1) Classification of stock payment
Stock payment refers to awards of equity instrument in order to obtain services form
employees and other parties, or transactions of liabilities on the basis of equity
instruments.
(2) Recognition of fair value of equity instruments
(3) Recognition basis of the best estimation of available equity instrument
(4) Relevant accounting methods for implementation, revise and termination of stock
payment plan
25. Counter-purchase of the Company stocks
26. Revenue
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(1) Specific standard of time recognition of revenues from selling goods
(a) Revenues from selling goods
No revenue from selling goods may be recognized unless the following conditions are
met simultaneously: the significant risks and rewards of ownership of the goods have
been transferred to the buyer by the enterprise; the enterprise retains neither
continuous management right that usually keeps relation with the ownership nor
effective control over the sold goods; the relevant amount of revenue can be measured
in a reliable way; the relevant economic benefits may flow into the enterprise; and
the relevant costs incurred or to be incurred can be measured in a reliable way.
The recognition of revenue from exported goods: For good exported by way of FOB,
the revenue shall be recognized once the goods were delivered to the carrier
designated by the purchaser; for goods exported by way of CIF, the revenue shall
be recognized once the goods reach the port of the purchase.
(b) Recognition method of revenue from sales of property
(c) It can recognize the realization of revenue of sales after signing the sales
contract, the property completed and accepted as qualified, reaching the deliverable
conditions agreed on the sales contract and the property payment totally paid
according to the sales contract
(2) Recognition basis of revenues from releasing the right to use assets
(a) Royalty revenue
In accordance with relevant contract or agreement, the amount of royalty revenue
should be recognized as revenue on accrual basis.
(b) Interest revenue
The amount of interest revenue should be measured and confirmed in accordance with
the length of time for which the Group’s monetary fund is used by others and the
agreed interest rate;
(c) Property rental revenue
For details about the recognition method of property rental revenue, please refer
to Note IV. 28 “Operating lease, Finance lease”.
(3) Revenue from providing labor services
If the Company can reliably estimate the outcome of a transaction concerning the
labor services it provides, it shall recognize the revenue from providing services
employing the percentage-of-completion method on the date of the balance sheet. The
completed proportion of a transaction concerning the providing of labor services
shall be decided by the proportion of the labor service already provided to the total
labor service to provide.
The outcome of a transaction concerning the providing of labor services can be
measured in a reliable way, means that the following conditions shall be met
simultaneously: ① The amount of revenue can be measured in a reliable way; ② The
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relevant economic benefits are likely to flow into the enterprise; ③ The schedule
of completion under the transaction can be confirmed in a reliable way; and ④ The
costs incurred or to be incurred in the transaction can be measured in a reliable
way.
If the outcome of a transaction concerning the providing of labor services can not
be measured in a reliable way, the revenue from the providing of labor services shall
be recognized in accordance with the amount of the cost of labor services incurred
and expected to be compensated, and make the cost of labor services incurred as the
current expenses. If it is predicted that the cost of labor services incurred could
not be compensated, thus no revenue shall be recognized.
Where a contract or agreement signed between Group and other enterprises concerns
selling goods and providing of labor services, if the part of sale of goods and the
part of providing labor services can be distinguished from each other and can be
measured respectively, the part of sale of goods and the part of providing labor
services shall be treated respectively. If the part of selling goods and the part
of providing labor services can not be distinguished from each other, or if the part
of sale of goods and the part of providing labor services can be distinguished from
each other but can not be measured respectively, both parts shall be conducted as
selling goods.
(4) Recognition basis of completion progress of contracts when confirming revenues
from providing services and constructing contracts in a way of completion percentage
27. Government subsidies
(1) Classification
A government subsidy means the monetary or non-monetary assets obtained free by the
Group from the government, but excluding the capital invested by the government as
the owner of the enterprise. Government subsidies consist of the government subsidies
pertinent to assets and government subsidies pertinent to income.
(2) Accounting method
If a government subsidy is a monetary asset, it shall be measured in the light of
the received or receivable amount. If a government subsidy is a non-monetary asset,
it shall be measured at its fair value. If its fair value cannot be obtained in a
reliable way, it shall be measured at its nominal amount. The government subsidies
measured at their nominal amounts shall be directly included in the current profits
and losses.
The government subsidies pertinent to assets shall be recognized as deferred income,
equally distributed within the useful lives of the relevant assets, and included
in the current profits and losses. The government subsidies pertinent to incomes
shall be treated respectively in accordance with the circumstances as follows: those
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subsidies used for compensating the related future expenses or losses of the
enterprise shall be recognized as deferred income and shall included in the current
profits and losses during the period when the relevant expenses are recognized; or
those subsidies used for compensating the related expenses or losses incurred to
the enterprise shall be directly included in the current profits and losses.
Where it is necessary to refund any government subsidy which has been recognized,
it shall be treated respectively in accordance with the circumstances as follows:
if there is the deferred income concerned, the book balance of the deferred income
shall be offset against, but the excessive part shall be included in the current
profits and losses; or if there is no deferred income concerned to the government
subsidy, it shall be directly included in the current profits and losses.
28. Deferred income tax assets and deferred income tax liabilities
(1) Recognition basis of deferred income tax assets
Generally speaking, deferred income tax assets are from deductible temporary
differences. When deductible temporary differences occur from differences between
fair value of assets, liabilities and its tax basis, and enough taxable incomes are
estimated retrievable in the future by taking advantages of the deductible temporary
differences, deferred income tax assets shall be confirmed by retrievable taxable
income tax which can be used to deduct deductible temporary differences.
No deferred taxable assets should be recognized for the deductible temporary
difference of initial recognition of assets and liabilities arising from the
transaction which is not business combination, the accounting profits will not be
affected, nor will the taxable amount or deductible loss be affected at the time
of transaction. Besides, no deferred taxable assets should be recognized for the
deductible temporary difference related to the investments of the subsidiary
companies, associated enterprises and joint enterprises, which are not likely to
be reversed in the expected future or is not likely to acquire any amount of taxable
income tax that may be used for making up such deductible temporary differences.
Otherwise, the Company shall recognize the deferred income tax assets arising from
a deductible temporary difference basing on the extent of the amount of the taxable
income that is likely to be acquired to make up such deductible temporary differences
For any deductible loss or tax deduction that can be carried forward to the next
year, the corresponding deferred income tax asset shall be determined to the extent
that the amount of future taxable income to be offset by the deductible loss or tax
deduction to be likely obtained.
On the balance sheet date, the deferred income assets shall be measured at the tax
rate applicable to the period during which the assets are expected to be recovered
or the liabilities are expected to be settled.
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The book value of deferred income tax assets shall be reviewed at each balance sheet
date. If it is unlikely to obtain sufficient taxable income to offset against the
benefit of the deferred income tax asset, the book value of the deferred income tax
assets shall be written down. Any such write-down should be subsequently reversed
where it becomes probable that sufficient taxable income will be available.
(2) Recognition basis of deferred income tax liabilities
Deferred income tax liabilities are from taxable temporary differences. During the
transferring period, taxable temporary differences would increase taxable incomes
and income tax payable, which leads to the outflow of economic benefits of enterprises.
Therefore, those referred to as tax payable of enterprises shall be confirmed as
liabilities.
No deferred tax liability is recognized for a temporary difference arising from the
initial recognition of goodwill, the initial recognition of assets or liabilities
due to a transaction other than a business combination, which affects neither
accounting profit nor taxable profit (or deductible loss). Besides, no deferred tax
assets is recognized for the taxable temporary differences related to the investments
of subsidiary companies, associated enterprises and joint enterprises, and the
investing enterprise can control the time of the reverse of temporary differences
as well as the temporary differences are unlikely to be reversed in the excepted
future. Otherwise, the Group should recognize the deferred income tax liabilities
arising form other taxable temporary difference.
On the balance sheet date, deferred income tax liabilities shall be measured at the
tax rate applicable to the period during which the assets are expected to be recovered
or the liabilities are expected to be settled.
29. Operating leases and finance leases
(1) Accounting method of operating leases
(a) Business of operating leases recorded by the Group as the lessee
The rent expenses from operating leases shall be recorded by the lessee in the
relevant asset costs or the profits and losses of the current period by using the
straight-line method over each period of the lease term. The initial direct costs
shall be recognized as the profits and losses of the current period. The contingent
rents shall be recorded into the profits and losses of the current period in which
they actually arise.
(b) Business of operating leases recorded by the Group as the lessor
The rent incomes from operating leases shall be recognized as the profits and losses
of the current period by using the straight-line method over each period of the lease
term. The initial direct costs of great amount shall be capitalized when incurred,
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and be recorded into current profits and losses in accordance with the same basis
for recognition of rent incomes over the whole lease term. The initial direct costs
of small amount shall be recorded into current profits and losses when incurred.
The contingent rents shall be recorded into the profits and losses of the current
period in which they actually arise.
(2) Accounting method of finance leases
(a) Business of finance leases recorded by the Group as the lessee
On the lease beginning date, the Group shall record the lower one of the fair value
of the leased asset and the present value of the minimum lease payments on the lease
beginning date as the entering value in an account, recognize the amount of the
minimum lease payments as the entering value in an account of long-term account
payable, and treat the balance between the recorded amount of the leased asset and
the long-term account payable as unrecognized financing charges. Besides, the
initial direct costs directly attributable to the leased item incurred during the
process of lease negotiating and signing the leasing agreement shall be recorded
in the asset value of the current period. The balance through deducting unrecognized
financing charges from the minimum lease payments shall be respectively stated in
long-term liabilities and long-term liabilities due within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method
in the lease term, so as to calculate and recognize current financing charges. The
contingent rents shall be recorded into the profits and losses of the current period
in which they actually arise.
(b) Business of finance leases recorded by the Group as the lessor
On the beginning date of the lease term, the Group shall recognize the sum of the
minimum lease receipts on the lease beginning date and the initial direct costs as
the entering value in an account of the financing lease values receivable, and record
the unguaranteed residual value at the same time. The balance between the sum of
the minimum lease receipts, the initial direct costs and the unguaranteed residual
value and the sum of their present values shall be recognized as unrealized financing
income. The balance through deducting unrealized financing incomes from the finance
lease accounts receivable shall be respectively stated in long-term claims and
long-term claims due within 1 year.
Unrecognized financing incomes shall be adopted by the effective interest rate method
in the lease term, so as to calculate and recognize current financing revenues. The
contingent rents shall be recorded into the profits and losses of the current period
in which they actually arise.
(3) Accounting method of leaseback
30. Available-for-sale assets
(1) Recognition standard of available-for-sale assets
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(2) Accounting method of available-for-sale assets
31. Asset securitization services
32. Hedge accounting
33. Change in major accounting policies and accounting estimates
In the reporting period, did any change in major accounting policies and accounting
estimates
□Yes √No
Three is not change in major accounting policies and accounting estimates in the
reporting period.
(1) Change in accounting policies
Did any accounting policies changed in the Group during the reporting period?
□Yes √No
(2) Change in accounting estimates
Did any accounting estimate changed in the Group during the reporting period?
□Yes √No
34. Corrections of prior accounting errors
Did any corrections of prior accounting error?
□Yes √No
In this period, the Group has no matter related to correction of prior-period errors.
(1) Retrospective restatement method
Did any corrections of prior accounting error by retrospective restatement method?
□Yes √No
(2) Perspective application method
Did any corrections of prior accounting error by Perspective application method?
□Yes √No
35. Other accounting policies, accounting estimates and compilation methods of
financial statements
Employee compensation
The Group recorded the employee compensation payables as liabilities during the
service period of employee.
The Group joins in the employee social security system established by the government
institution in accordance with relevant rules and laws, which include the basic
retirement insurance, medical insurance and other social insurances, as well as the
housing accumulation fund, and relevant expenditures should be recorded into cost
of relevant assets or current profits and losses upon the occurrence.
If an enterprise cancels the labor relationship with any employee prior to the
expiration of the relevant labor contract or brings forward any compensation proposal
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for the purpose of encouraging the employee to accept a layoff, and the following
conditions are met concurrently, the enterprise shall recognize the expected
liabilities incurred due to the compensation for the cancellation of the labor
relationship with the employee, and shall simultaneously record them into the profit
or loss for the current period: the enterprise has formulated a formal plan on the
cancellation of labor relationship or has brought forward a proposal on voluntary
layoff and will execute it soon; and the enterprise is unable to unilaterally withdraw
the plan on the cancellation of labor relationship or the layoff proposal.
The inside employee retirement plan is treated by adopting the same principle with
the above dismission welfare. The group would recorded the salary and the social
security insurance fees paid and so on from the employee’s service terminative date
to normal retirement date into current profits and losses (dismission welfare) under
the condition that they meet the recognition conditions of estimated liabilities.
Impairment of non-current non-financial assets
For the non-current non-financial assets, such as fixed assets, construction in
progress, intangible assets with finite service life, investment real assets
measured by cost mode as well as long-term equity investment on subsidiaries,
co-operative enterprise and joint-operative enterprise, etc., are tested for
impairment if there is any indication that an asset may be impaired at the balance
date. If there is any sign of possible assets impairment, the Group shall estimate
the recoverable amount and made the impairment tests. No matter whether there is
any sign of possible assets impairment, the good will, intangible assets without
certain service life, intangible assets not ready for use shall be subject to
impairment test every year.
If the result of the impairment test indicates that the recoverable amount of the
asset is less than its book value, a provision for impairment and an impairment loss
are recognized for the amount by which the asset’s book value exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s fair value less costs
to sell and the present value of the future cash flows expected to be derived from
the asset. The fair value of an asset shall be determined in light of the basis of
the price as stipulated in the sales agreement. Where there is no sales agreement
but there is an active market of assets, the fair value of the asset shall be
determined according to the price bidden by the buyer of the asset; Where there is
no sales agreement and no active market of assets, the fair value of an asset shall
be estimated in light of the best information available. The disposal expenses shall
include the relevant legal expenses, relevant taxes, trucking charge as well as the
direct expenses for bringing the assets into a marketable state. The current value
of the expected future cash flow of an asset shall be determined by the discounted
cash with an appropriate discount rate, on the basis of the expected future cash
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flow generated during the continuous use or final disposal of an asset. A provision
for asset Impairment is determined and recognized on an individual asset basis. If
it is not possible to estimate the recoverable amount of an individual asset, the
recoverable amount of the group of assets to which the asset belongs is determined.
A group of assets is the smallest group of assets that is able to generate independent
cash inflows.
For the goodwill separately listed in the financial statements, during the impairment
test, the book value of this goodwill is allocated to the related asset group or
groups of asset group which is expected to benefit from the synergies of the business
combination. If the result of the test indicates that the recoverable amount of an
asset group or groups of asset group including the goodwill allocated is lower than
its book value, the corresponding impairment loss is recognized. The impairment loss
is first deducted from the book value of goodwill allocated to the asset group or
groups of asset group, and then deducted from the book value of the remaining assets
of the asset group or groups of asset group pro rata with goodwill.
Once the asset impairment loss mentioned above is recognized, it is not allowed to
be reversed even if the value is recovered in the subsequent periods.
Critical accounting judgments and estimates
Due to the inside uncertainty of operating activity, the Group needed to make
judgments, estimates and assumption on the book value of the accounts without
accurate measurement during the employment of accounting policies. And these
judgments, estimates and assumption were made basing on the prior experience of the
senior executives of the Group, as well as in consideration of other factors. These
judgments, estimates and assumption would also affect the report amount of income,
costs, assets and liabilities, as well as the disclosure of contingent liabilities
on balance sheet date. However, the uncertainty of these estimates was likely to
cause significant adjustment on the book value of the affected assets and
liabilities.
The Group would check periodically the above judgments, estimates and assumption
on the basis of continuing operation. For the changes in accounting estimates only
affected on the current period, the influence should be recognized at the period
of change occurred; for the changes in accounting estimates affected the current
period and also the future period, the influence should be recognized at the period
of change occurred and future period.
On the balance sheet date, the Group needed to make judgments, estimates and
assumption on the accounts in the following important items:
(1) Categorization of leasing
In accordance with Accounting Standards for Enterprises No. 21 – Leasing, the Group
categorized the leasing into operating lease and finance lease. During the
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categorization, the management level needed to make analysis and judgment on whether
all the risk and compensation related with the leased assets had been transferred
to the leasee, or whether the Group had already undertaken all the risk and
compensation related with the leased assets.
(2) Provision for bad debts
In accordance with the accounting policies of accounts receivable, the Group measured
the losses for bad debts by adopting allowance method. The impairment of accounts
receivable was based on the appraisal of the recoverability of accounts receivable.
The impairment of accounts receivable was dependent on the judgment and estimates.
The actual amount and the difference of previous estimates would affect the book
value of accounts receivable and the withdrawal and reversal on provision for bad
debts of accounts receivable during the period of estimates being changed.
(3) Provision for falling price of inventories
In accordance with the accounting policies of inventories, for the inventories that
the costs were more than the net realizable value as well as out-of-date and dull-sale
inventories, the Group withdrew the provision for falling price of inventories on
the lower one between costs and net realizable value. Evaluating the falling price
of inventories needed the management level gain the valid evidence and take full
consideration of the purpose of inventories, influence of events after balance sheet
date and other factors, and then made relevant judgments and estimates. The actual
amount and the difference of previous estimates would affect the book value of
inventories and the withdrawal and reversal on provision for bad debts of inventories
during the period of estimates being changed.
(4) The fair value of financial instrument
For the financial instruments without active market, the Group recognized the fair
value by various methods. These evaluation methods included discounted cash flow
mode analysis, etc. The Group needed to estimate the future cash flow, credit risk,
fluctuation rate of market and relativity and other factors, as well as choose the
property discount rate. Due to the uncertainty of relevant assumptions, so their
changes would affect the fair value of financial instrument.
(5) The impairment of financial assets available for sale
The Group judged whether the financial assets available for sale were impaired
relying heavily on the judgment and assumption of the management team, so as to decide
whether recognized the impairment losses in the income statement. During the process
of making the judgment and assumption, the Group needed to appraise the balance of
the cost of the investment exceeding its fair value and the continuous period, the
financial status and business forecast in a short period, including the industrial
situation, technical reform, credit level, default rate and risk of counter-party.
(6) Provision for impairment of non-financial non-current assets
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The Group made a judgment on the non-current assets other than financial assets
whether they had any indication of impairment on the balance sheet date. For the
intangible assets without finite service life, other than the annual impairment test,
they should be subject to the impairment test when there was any indication of
impairment. For other non-current non-financial assets, it should subject to
impairment test when there was indication of impairment showing that the book value
can’t be recoverable.
When the book value of the assets or assets portfolio was more than the recoverable
amount, which was the higher one between the net amount of fair value after deducting
the disposal expenses and the discounted amount of the estimated future cash flow,
it means impairment incurred.
The net amount of fair value after deducting the disposal expenses should be fixed
the price in the sale agreement for similar assets in the fair transaction minus
the increased costs directly attributable to the assets disposal.
When estimated the discounted value of future cash flow, the Group needed to make
important judgment on the output, selling price, relevant costs and the discount
rate for calculating the discounted amount, etc. When estimated the recoverable
amount, the Group would adopt all the available documents, including the predictions
for relevant output, selling price and relevant operating costs arising from
reasonable and supportive assumptions.
The Group made the impairment test on goodwill at least one time per year, which
required to predict the discounted amount of the future cash flow of the assets or
assets portfolio with the distributed good will, for which, the Group needed to
predict the future cash flow of the assets or assets portfolio, and adopt the property
discounted rate to decide the discounted amount of future cash flow.
(7) Depreciation and amortization
For the investment real estate, fixed assets and intangible assets, the Group
withdrew the depreciation and amortization by adopting the straight-line method
during the service life after full consideration of the salvage value. The Group
checked the service life periodically so as to decide the amount of depreciation
and amortization at each reporting period. The service life was fixed by the Group
in accordance with the previous experience of the similar assets and the expected
technical update. If there was any significant change on the previous estimates,
the depreciation and amortization expenses should be adjusted.
(8) Expenditures for development
When fixing the amount of capitalization, the management level of the Group needed
to make assumption on the predicted future cash flow, property discounted rate and
estimated beneficiary period for relevant assets.
(9) Deferred income tax assets
114
Within the limit that it was likely to have sufficient taxable profits to offset
the losses, the Group recognized the deferred income tax assets by all the unused
tax losses, which needed the management level of the Group to estimate time and amount
of the future taxable profits incurred with many judgments, as well as integrate
strategy of tax payment, to decide the amount of deferred income tax assets which
should be recognized.
(10) Income tax
During the routine operating activities, there were some uncertainty in the ultimate
tax treatment and calculation for parts of transactions. Some accounts of such
transaction could be listed as pre-tax expenditures only after the approval of
taxation authorities. If there were any differences between the ultimate result of
recognition for these taxation maters and their initial estimates, the differences
would affect the current income tax and deferred income tax at the period of ultimate
recognition.
(11) Estimated liabilities
The Group made the estimation on product quality guarantee, predicted loss of
contract and the fine for delayed delivery, etc. and withdrew the relevant provision
for estimated liabilities in accordance the provisions of contract, current
knowledge and experience. Under the condition that the contingent event has formed
a current duty and fulfilling the duty is likely to cause the economical interest
outflow the Group, the Group measures the estimated liabilities in accordance with
the best estimate of the necessary expenses for the performance of the current duty.
The recognition and measurement of estimated liabilities were heavily relied on the
judgment of the management team. During the process of making judgment, the Group
needed to appraise the relevant risks, uncertainty and the time value of money and
etc.
Of which, the Group estimated the liabilities basing on the after-sale services
commitments to the customers upon the sale, repair and reform of goods. When
estimating the liabilities, the Group has fully taken the consideration of the latest
repair experience, but which may not reflect the repair situation in the future.
Any increase / decrease of the provision for estimated liabilities may affect the
profits and losses in the future periods.
V. Taxation
1. Main taxes and tax rate
Category of taxes Tax basis Tax rate
Calculated the output tax at 17%
of taxable income and paid the VAT
VAT 17%
by the amount after deducting the
deductible withholding VAT at
115
current period.
Paid by 5% of taxable business
Business tax income 5%
Paid at 7% of the circulating tax
Urban maintenance and construction tax 7%
actually paid
Paid at 25% of the taxable income,
Hong Kong Company at 16.5%,
Paid according to the income Wankaida at 12.5%, Chongqing
Enterprise income tax amount of the taxes payable and Konka, Dongguan Mould and
the applicable income tax rate plastic, Anhui Tongchuang and
Anhui Konka, Kunshan Konka,
Information network at 15%.
Education surtax Paid at 3% of the circulating tax
3%
actually paid
Local education surtax Paid at 2% of the circulating tax
2%
actually paid
The income tax rates adopted by each subsidiary and branch factory
As for the transportation revenue of the logistic business of the Company ’ s
subsidiary Shushida Logistics, in accordance with the Notice on Carrying out the
Pilot of Change on Charging the Business Taxes of Transportation Industry and Partial
Modern Service Industry to Value Added Taxes in Eight Provinces and Cities including
Beijing issued by the Ministry of Finance and the National Taxation Bureau (CS [2012]
No. 71) and other regulations, it was changed to charge the VAT since 1 Sept. 2012,
with the tax rate of 3%. From 1 Jun. 2013, Shushida Logistics received the general
taxpayer qualification with the VAT rate of the transportation revenue of 11% and
the other service of 6%.
In accordance with the Notice on Printing the Administration Method on Charging and
Use of the Treatment Funds of Discarded Electronic Appliance and Electric Products
issued by the Ministry of Finance, Ministry of Environmental Protection, National
Development and Reform Commission, Ministry of Industry and Information, General
Administration of Customs and National Taxation Bureau (CZ [2012] No. 34), and the
Administration Method on Charging and Use of the Treatment Funds of Discarded
Electronic Appliance and Electric Products issued by National Taxation Bureau
(GJSWZJGG [2012] No. 41), the domestic manufacturer of the electrical appliances
and electronic products of PRC started to pay the treatment funds for discarded
electrical appliance and electronic products according the sales volume (trusted
processing amount) and relevant charging standards from 1 Jul. 2012. According to
the regulations, the Group’s charging standards were RMB 13 per set of TV, RMB 12
per set of refrigerator and RMB 7 per set of washing machine.
According to regulations of Temporary Provisions of Income Tax of Trans-boundary
116
Tax Payment Enterprises by State Administration of Taxation, resident enterprises
without business establishment or places of legal persons should be tax payment
enterprises with the administrative measures of income tax of “unified computing,
level-to-level administration, local prepayment, liquidation summary, and finance
transfer”. It came into force from January 1, 2008.
According to the above methods, the Company’s sales branch companies in each area
will hand in the corporate income taxes in advance from 1 Jan. 2008 and will be final
settled uniformly by the Company at the year-end.
The tax rate should paid at 25% of the taxable income, Hong Kong Company at 16.5%,
Wankaida at 12.5%, Chongqing Konka, Dongguan Mould and plastic, Anhui Tongchuang
and Anhui Konka, Kunshan Konka, Information network at 15%.
2. Tax preference and approved document
(1) On 14 Oct., 2013, the subsidiary of the Company, Anhui Konka, received the
certificate of high-technology enterprises (No.: GF2013342000298) awarded by Anhui
Science and Technology Department, Anhui Department of Finance, Anhui State Taxation
Bureau and Anhui Local Taxation Bureau. The period of validity is three years.
According to taxation rules, Anhui Konka would enjoy the preferential tax privileges
of high-technology enterprises from 2013 to 2015 and pay the enterprise income tax
at the preferential rate of 15%.
(2) On 22 Jul. 2013, the wholly-owned subsidiary of the Company-Shenzhen Konka
Telecommunications Technology Co., Ltd. obtained the Certificate of High-Tech
Enterprise No. GR201344200179 jointly issued by Shenzhen Bureau of Science
Technology & Information, Shenzhen Financial Bureau, Shenzhen Municipal State
Taxation Bureau, and Shenzhen Municipal Local Taxation Bureau, valid for three years.
According to Enterprise Income Tax Law and Implementation Rules of the People's
Republic of China, the Company of Telecommunications Technology enjoys the
referential tax privileges of high-technology enterprises and pays the enterprise
income tax at the preferential rate of 15%.
(3) On 12 Sept. 2012, the Company’s subsidiary— Dongguan Konka Mould Plastic was
filed for the high-tech enterprise certification by Ministry of Science and
Technology, and received Certificate of High-Tech Enterprise with No. GF201244000053,
was valid for three years. According to relevant taxation regulations, Dongguan Konka
Mould Plastic would enjoy relevant preferential policies for high-tech enterprises
for successive three years since 2012 and was levied at the preferential enterprise
income tax rate of 15%.
(4) On 3 Jul. 2012, the Company ’ s subsidiary Anhui Tongchuang received the
Certificate of Hi-tech Enterprise jointly issued by Department of Science &
Technology, Finance Bureau, National Taxation Bureau and Local Taxation Bureau of
117
Anhui Province (No. GR201234000074) with valid term of three years. In accordance
with relevant stipulations of taxation, Anhui Tongchuang will enjoy relevant
preferential policies for high-tech enterprises for successive three years since
2012 and was levied at the preferential enterprise income tax rate of 15%.
(5) On 8 Nov., 2014, the subsidiary of the Company, Kunshan Konka Electronic Co.,
Ltd, obtained the Certificate of High-Tech Enterprise No.: GR201132000506 jointly
issued by Jiangsu Science and Technology Department, Jiangsu Department of Finance,
Jiangsu State Taxation Bureau and Jiangsu Local Taxation Bureau. The period of
validity is three years. According to taxation rules, Kunshan Konka would enjoy the
preferential tax privileges of high-technology enterprises from 2014 to 2017 and
pay the enterprise income tax at the preferential rate of 15%.
(6) The Company’s subsidiary—Chongqing Qingjia Electronics Co., Ltd. is levied
the business income tax at the preferential tariff of 15% from 1 Jan. 2011 to 31
Dec. 2020 in accordance with CS (2011) No. 58 Notice on Relevant Tax Policies on
Deeply Implementing the western development strategy.
(7) According to the CS No. [2008] 1 Article issued by Ministry of Finance and State
Administration of Taxation, the identified new software manufacturing enterprises
in China would be exempted from enterprise income tax in the first and second year,
and halved the enterprise income tax from the 3rd year to the 5th year. Shenzhen
Wankaida Science and Technology Co., Ltd was exempted from 2010 to 2011 and halved
the enterprises income tax from 2012 to 2014. The applicable tax rate of this year
is 12.5%.
(8) According to the CS No. [2011] 100 Article issued by Ministry of Finance and
State Administration of Taxation, if the ordinary VAT payer sells software products
developed by itself, the VAT is levied at the rate of 17% and after that, the part
of actual tax burden of VAT which exceeds 3% can enjoy the policy of refunding taxes
immediately after levying taxes. The Company and its subsidiaries
Shenzhen Konka Telecommunications Technology Co., Ltd., Shenzhen Konka Video &
Communication Systems Engineering Co., Ltd., Shenzhen Konka Information Network Co.,
Ltd., Shenzhen Wankaida Technology Co., Ltd. can enjoy such favorable policy.
3. Other explanations
VI. Business Combination and Consolidated Financial Statements
1. Subsidiaries
(1) Subsidiaries obtained through establishment or investment
Unit: RMB Yuan
Subsi Regis Busin Regis Busin Actua Other The The Inclu Minor Deduc Balan
Type
diari tered ess tered ess l essen propo propo ded ity tible ce of
118
es place natur capit scope amoun tial rtion rtion in inter minor paren
e al t of inves of of conso est ity t
inves tment holdi votin lidat inter compa
tment ng g ed ests ny’s
s at share right state equit
the s s ment y
perio after
d-end deduc
ting
the
diffe
rence
that
loss
of
minor
ity
inter
ests
excee
d
equit
y
obtai
ned
by
minor
ity
share
holde
rs
Produ
Shenz ction
hen and
Konka sales
Telec Wholl Manuf of
Shenz
ommun y-own actur RMB12 mobil
hen, 12,00 100.0 100.0
icati ed ing ,000. e Yes
Guang 0.00 0% 0%
ons subsi indus 00 commu
dong
Techn diary try nicat
ology ion
Co., produ
Ltd. cts
and
119
sales
of
multi
-medi
a
produ
cts
Shenz
Produ
hen
ction
Konka
and
Preci Manuf
Holdi Shenz sales
sion actur RMB4,
ng hen, of 739.5 46.31 52.49 4,447
Mould ing 000.0 Yes
subsi Guang plast 0 % % .77
Manuf indus 0
diary dong ics
actur try
and
ing
mould
Co.,
s
Ltd.
Produ
Shenz ction
Sales
hen and
Holdi Shenz of
Konka sales
ng hen, elect RMB83 1,073 51.00 51.00 -862.
Elect of Yes
subsi Guang ronic 0.00 .25 % % 79
ronic house
diary dong appli
Co., hold
ance
Ltd. appli
ance
Produ
Shenz
ction
hen
and
Konka
Wholl Manuf sales
Infor Shenz
y-own actur RMB3, of
matio hen, 3,000 100.0 100.0
ed ing 000.0 digit Yes
n Guang .00 0% 0%
subsi indus 0 al
Netwo dong
diary try netwo
rk
rk
Co.,
produ
Ltd.
cts
Shenz Wholl Manuf Produ
Shenz
hen y-own actur ction
hen, RMB95 950.0 100.0 100.0
Konka ed ing and Yes
Guang 0.00 0 0% 0%
Plast subsi indus sales
dong
ic diary try of
120
Produ plast
cts ics
Co.,
Ltd.
Resea
rch,
Shenz
devel
hen
opmen
Konka
Wholl Manuf t,
Life Shenz
y-own actur RMB4, desig
Elect hen, 4,200 100.0 100.0
ed ing 200.0 n and Yes
rical Guang .00 0% 0%
subsi indus 0 sales
Appli dong
diary try of
ance
elect
Co.,
ric
Ltd.
produ
cts
Shenz
hen
Konka
Elect Wholl
Shenz Inves
ronic y-own RMB6,
hen, tment Inves 6,500 100.0 100.0
Fitti ed 500.0 Yes
Guang holdi tment .00 0% 0%
ngs subsi 0
dong ng
Techn diary
ology
Co.,
Ltd.
Produ
Mudan
ction
jiang
Mudan and
Arcti Manuf
Holdi jiang sales
c actur RMB6,
ng , of 3,600 60.00 60.00 1,119
Ocean ing 000.0 Yes
subsi Heilo multi .00 % % .68
Appli indus 0
diary ngjia -medi
ances try
ng a
Co.,
produ
Ltd.
cts
Shanx Holdi Manuf Produ
Xiany
i ng actur RMB6, ction
ang, 5,529 60.00 60.00 2,925
Konka subsi ing 950.0 and Yes
Shaan .48 % % .05
Elect diary indus 0 sales
xi
ronic (alre try of
121
Co., ady multi
Ltd. been -medi
trans a
ferre produ
d and cts
wheth
er
was
also
the
subsi
diary
of
the
Compa
ny)
Produ
Chong ction
qing and
Konka Manuf sales
Holdi
Autom actur RMB3, of
ng Chong 1,710 57.00 57.00 -800.
otive ing 000.0 Autom Yes
subsi qing .00 % % 96
Elect indus 0 otive
diary
ronic try elect
Co., ronic
Ltd. equip
ment
Produ
ction
and
Chong
sales
qing
Manuf of
Qingj Holdi
actur RMB1, elect
ia ng Chong 600.0 40.00 40.00 1,179
ing 500.0 ronic Yes
Elect subsi qing 0 % % .20
indus 0 turne
ronic diary
try rs
Co.,
and
Ltd.
3D
glass
es
Anhui Holdi Chuzh Manuf RMB14 Produ
12,27 78.00 78.00 5,922
Konka ng ou, actur ,000. ction Yes
8.09 % % .20
Elect subsi Anhui ing 00 and
122
ronic diary indus sales
Co., try of
Ltd. multi
-medi
a
produ
cts
Produ
ction
and
sales
of
house
Anhui hold
Manuf
Konka Holdi appli
Chuzh actur RMB7,
Appli ng ance 8,087 96.46 97.45 235.6
ou, ing 819.0 Yes
ance subsi like .17 % % 5
Anhui indus 0
Co., diary refri
try
Ltd. gerat
ors
and
washi
ng
machi
ne
Produ
ction
Chang
and
shu
sales
Konka
of
Elect
Manuf elect
ronic Holdi Chang
actur RMB2, ronic
Co., ng shu, 2,027 60.00 60.00 793.2
ing 465.0 produ Yes
Ltd. subsi Jiang .89 % % 0
indus 0 cts
Konka diary su
try and
Elect
elect
ronic
ronic
Co.,
trans
Ltd.
forme
r
Kunsh Wholl Kunsh Manuf RMB35 Produ
35,00 100.0 100.0
an y-own an, actur ,000. ction Yes
0.00 0% 0%
Konka ed Jiang ing 00 and
123
Elect subsi su indus sales
ronic diary try of
Co., liqui
Ltd. d
cryst
al
modul
es
and
multi
-medi
a
produ
cts
Produ
ction
Dongg
and
uan Wholl Manuf
Dongg sales
Konka y-own actur RMB26
uan, of 26,66 7,478 100.0 100.0
Elect ed ing ,667. Yes
Guang multi 7.00 .40 0% 0%
ronic subsi indus 00
dong -medi
Co., diary try
a
Ltd.
produ
cts
Produ
ction
and
Dongg
sales
uan
of
Konka Wholl Manuf
Dongg plast
Packi y-own actur RMB1,
uan, ic 1,000 100.0 100.0
ng ed ing 000.0 Yes
Guang produ .00 0% 0%
Mater subsi indus 0
dong cts
ials diary try
and
Co.,
plast
Ltd.
ic
packa
ging
Dongg Manuf Produ
Holdi Dongg
uan actur RMB1, ction
ng uan, 1,000 59.73 59.73 4,511
Konka ing 000.0 and Yes
subsi Guang .00 % % .18
Mould indus 0 sales
diary dong
Plast try of
124
ic mould
Co., s and
Ltd. plast
ics
Produ
ction
and
sales
of
singl
e-fac
Boluo Manuf ed
Holdi Boluo
Konka actur RMB4, and
ng ， 2,428 51.00 51.00 275.1
PCB ing 000.0 doubl Yes
subsi Guang .52 % % 6
Co., indus 0 e-fac
diary dong
Ltd. try ed
circu
it
board
elect
ronic
produ
cts
Produ
ction
and
sales
Boluo of
Konka high-
Wholl Manuf
Preci Boluo densi
y-own actur RMB1,
sion , ty 1,125 100.0 100.0
ed ing 500.0 Yes
Techn Guang circu .00 0% 0%
subsi indus 0
ology dong it
diary try
Co., board
Ltd. elect
ronic
produ
ction
s
Konka Wholl Fosha Resea R&D
RMB50 100.0 100.0
(Nanh y-own n, rch of 50.00 Yes
.00 0% 0%
ai) ed Guang and flat
125
Devel subsi dong devel panel
opmen diary opmen displ
t t ay
Cente techn
r ologi
es
and
produ
cts
Expor
ting
and
impor
Hong Wholl
Inter ting
Kong y-own Hong
natio HKD50 machi 100.0 100.0
Konka ed Kong， 78.18 Yes
nal .00 nery 0% 0%
Co., subsi China
trade and
Ltd. diary
elect
ronic
produ
cts
Konka
House
hold
Appli
ances Wholl
Inves
Inves y-own Hong
tment HKD50 Inves 100.0 100.0
tment ed Kong, 53.06 Yes
holdi .00 tment 0% 0%
& subsi China
ng
Devel diary
opmen
t
Co.,
Ltd.
Konka
Expor
House
t and
hold Wholl
Inter impor
Appli y-own Hong
natio HKD50 t of 100.0 100.0
ances ed Kong, 53.31 Yes
nal .00 elect 0% 0%
Inter subsi China
trade ronic
natio diary
produ
nal
cts
Tradi
126
ng
Co.,
Ltd.
Sales
Wholl
KONKA Inter of
y-own
AMERI The natio USD10 elect 806.2 100.0 100.0
ed Yes
CA,IN USA nal 0.00 ronic 5 0% 0%
subsi
C. trade produ
diary
cts
Frank Sales
Konka Wholl
furt, Inter of
(Euro y-own
Germa natio EUR2. elect 100.0 100.0
pe) ed 26.15 Yes
ny, nal 50 ronic 0% 0%
Co., subsi
Europ trade produ
Ltd. diary
e cts
Dongg Produ
uan ction
Xuton Manuf and
Holdi Dongg
gda actur sales
ng uan RMB50 231.5 46.31 52.49 624.7
Mould ing of Yes
subsi Guang 0.00 5 % % 8
Plast indus mould
diary dong
ic try s and
Co., plast
Ltd. ics
Devel
opmen
t,
sales
Shenz and
hen maint
Konka Resea enanc
Wholl
Optoe Shenz rch e of
y-own RMB1,
lectr hen and techn 1,000 100.0 100.0
ed 000.0 Yes
onic Guang devel ologi .00 0% 0%
subsi 0
Techn dong opmen es
diary
ology t like
Co., liqui
Ltd. d
cryst
al
modul
es
Shenz Wholl Shenz Softw RMB1, Devel 1,000 100.0 100.0 Yes
127
hen y-own hen are 000.0 opmen .00 0% 0%
Wanka ed Guang devel 0 t and
ida subsi dong opmen maint
Scien diary t enanc
ce e of
and softw
Techn are
ology techn
Co., ologi
Ltd. es
Devel
Kunsh
opmen
an
t,
Kangs
opera
heng Wholl
Kunsh Prope tion
Inves y-own RMB35
an rty and 35,00 100.0 100.0
tment ed ,000. Yes
Jiang indus inves 0.00 0% 0%
Devel subsi 00
su try tment
opmen diary
of
t
real
Co.,
estat
Ltd.
e
Produ
ction
and
sales
Anhui of
Konka house
Tongc hold
Wholl Manuf
huang appli
y-own Chuzh actur RMB18
House ance 9,000 75.00 100.0
ed ou ing ,000. Yes
hold like .00 % 0%
subsi Anhui indus 00
Appli refri
diary try
ances gerat
Co., ors
Ltd. and
washi
ng
machi
ne
Indon Holdi Inter Sales
Indon USD15 497.1 51.00 51.00 -100.
esia ng natio of Yes
esia 0.00 7 % % 98
Konka subsi nal elect
128
Elect diary trade ronic
ronic produ
s cts
Co.,
Ltd.
Shenz
hen
Shush Ordin
Wholl
ida Shenz ary
y-own RMB1,
Logis hen Logis freig 1,000 100.0 100.0
ed 000.0 Yes
tics Guang tics ht .00 0% 0%
subsi 0
Servi dong trans
diary
ce port
Co.,
Ltd.
Beiji
Sales Sales
ng Wholl
of of
Konka y-own RMB3,
Beiji house elect 3,000 100.0 100.0
Elect ed 000.0 Yes
ng hold ronic .00 0% 0%
ronic subsi 0
appli produ
Co., diary
ance cts
Ltd.
Kunsh Produ
an ction
Jielu Manuf and
Holdi Kunsh
nte actur RMB10 sales
ng an 4,631 46.31 52.49 -74.1
Mould ing ,000. of Yes
subsi Jiang .00 % % 1
Plast indus 00 mould
diary su
ic try s and
Co. , plast
Ltd. ics
Resea
rch,
Wuhan devel
Jielu opmen
Manuf
nte Holdi t,
actur RMB3,
Mould ng Hubei produ 1,389 46.31 52.49 -28.7
ing 000.0 Yes
Plast subsi Wuhan ction .30 % % 3
indus 0
ic diary ,
try
Co. , sales
Ltd. of
mould
produ
129
ction
s and
hardw
are
produ
cts.
Resea
rch,
devel
opmen
t,
produ
ction
Chuzh ,
ou sales
Jielu Manuf of
Holdi
nte Anhui actur RMB2, mould
ng 926.2 46.31 52.49
Mould Chuzh ing 000.0 produ Yes -5.22
subsi 0 % %
Plast ou indus 0 ction
diary
ic try s,
Co. , plast
Ltd. ic
produ
cts
and
hardw
are
produ
cts.
Other notes to subsidiaries obtained by establishment and investment:
Notes: ① The Company holds 46.31% of shares of Shenzhen Konka Precision Mold
Manufacturing Co., Ltd., Konka Household Appliances Investment & Development Co.,
Ltd, a subsidiary company of the Company, are entrusted to manage 6.18% shares held
by Shenzhen Dingshengxin Mould Technology Consultation Co., Ltd. After the
entrustment, the percentage of voting rights of the Company increases to 52.49%.
Therefore, the financial statements of Shenzhen Konka Precision Mold Manufacturing
Co., Ltd. are combined into the consolidated financial statements. Xutongda is a
wholly funded subsidiary of Dongguan Konka Mould Plastic Co., Ltd and is also combined
into the consolidated financial statements.
② The Company holds 40.00% shares of Chongqing Qingjia Electronic Co., Ltd that
all senior managers of Chongqing Qingjia Electronic Co., Ltd are appointed and
dismissed by the Company. Among the directors, half of them or over half are
dispatched directly or indirectly by the Company. Moreover, in Chongqing Qingjia,
130
70% to 80% of its products are sold to the Company and thus the Company has absolute
influence and control over the production and operation of Chongqing Qingjia
Electronic Co., Ltd., which is combined into the consolidated financial statement.
③ Shenzhen Konka Precision Mold Manufacturing Co., Ltd. held 100% equity of Dongguan
Xutongda Mould Plastic Co., Ltd., and the Company is the actual controller of Dongguan
Xutongda Mould Plastic Co., Ltd., for the Company indirectly held 46.31% shares and
52.49% voting right of Dongguan Xutongda Mould Plastic Co., Ltd., which is combined
into the consolidated financial statement.
④ Anhui Tongchuang is a limited company jointly invested and established by the
Company and Chuzhou Tongchuang Construction Investment Co., Ltd. (hereinafter refer
to as “Tongchuang Construction”) with registration capital of RMB 180 million,
of which each party invested in RMB 90 million respectively on contract. As to 31
Dec. 2010, Anhui Tongchuang with a paid-up capital of RMB 120 million (including
paid-up capital of RMB 90 million of the Company, 75.00% of total paid-up capital;
and paid-up capital of RMB 30 million of Tongchuang Construction, 25.00% of total
paid-up capital ). According to contract sign by two parties, Tongchuang Construction
has the rights of transferring stock ownership three years after the establishment
of Anhui Tongchuang Company. Meanwhile, the Company can repurchase the said stock
ownership and contracted with Tongchuang Investment Company that the Company shall
receive fixed investment gains at 2% of actual capital invested by the Group annually.
So the Company can conduct actual control to Anhui Tongchuang Company, and combines
it into the consolidated financial statement.
⑤ Precision Mould held 100% equity of Kunshan Jielunte, Wuhan Jielunte and Chuzhou
Jielunte and was actually controlled by the Company. The Company indirectly held
46.31% equity of Jielunte and the 52.49% voting right of it, ，which is combined
into the consolidated financial statement.
⑥ The Company held 6.55% equity of Anhui Electronic; the controlling subsidiary
Anhui Konka of the Company held 4.48% equity of Anhui Electronic; the wholly owned
subsidiary of the Company Anhui Tongchuang held 86.42% equity of Anhui Electronic.
(2) Subsidiaries obtained by business combination under the same control
Unit: RMB Yuan
Actua The The Inclu Deduc Balan
Other
Busin Regis l propo propo ded Minor tible ce of
Subsi Regis Busin essen
ess tered amoun rtion rtion in ity minor paren
diari Type tered ess tial
natur capit t of of of conso inter ity t
es place scope inves
e al inves holdi votin lidat est inter compa
tment
tment ng g ed ests ny’s
131
s at share right state equit
the s s ment y
perio after
d-end deduc
ting
the
diffe
rence
that
loss
of
minor
ity
inter
ests
excee
d
equit
y
obtai
ned
by
minor
ity
share
holde
rs
Other explanation on subsidiaries obtained by business combination under same
control
(3) Subsidiaries obtained by business combination not under the same control
Unit: RMB Yuan
Balan
Actua ce of
l The The Inclu paren
amoun propo propo ded Deduc t
Other
Busin Regis t of rtion rtion in Minor tible compa
Subsi Regis Busin essen
ess tered inves of of conso ity minor ny’s
diari Type tered ess tial
natur capit tment holdi votin lidat inter ity equit
es place scope inves
e al s at ng g ed est inter y
tment
the share right state ests after
perio s s ment deduc
d-end ting
the
132
diffe
rence
that
loss
of
minor
ity
inter
ests
excee
d
equit
y
obtai
ned
by
minor
ity
share
holde
rs
Other explanation on subsidiaries obtained by business combination not under same
control
2. Special purpose entities or operating entities with control right formed by
entrusted operation or lease
Unit: RMB Yuan
Main business with the Closing balance of the recognized main assets and
Name
Company liabilities in the consolidate financial statement
Other explanation on special purpose entities or operating entities with control
right formed by entrusted operation or lease
3. Explanations on changes of consolidation scope
Notes to change in consolidation scope
The Company held the Board Meeting on 22 May, 2014 and the 2014 1st General Meeting
of Shareholders on 9 Jul. 2014. It was decided to sell the 100% stock rights of the
wholly-owned subsidiary, Shenzhen Konka Video System Engineering Co., Ltd, to the
parent company, OCT ENTERPRISES CO. with actual purchase price of RMB 247,687,800.
The share transfer was completed on 23 Jun. 2014. After the share right transfer,
the Company ’ s control over this enterprise ceased. Therefore, it has been
deconsolidated since 1 Jun. 2014.
√Applicable □Not applicable
This year (period) newly increased 0 combined units over the last year and the reasons
as:
133
There is not new subsidiary included within the consolidation scope, special purpose
entity or other operational entity by trust or tenant.
This year (period) newly reduced 1 combined unit over the last year and the reasons
as:
On 22 May 2014, the Company held the Board Meeting. It was decided to sell the 100%
stock rights of the wholly-owned subsidiary, Shenzhen Konka Video System Engineering
Co., Ltd, to the parent company, OCT Holdings Company with actual purchase price
of 265,803,800 Yuan. The share transfer would be completed on 23 June, 2014. After
share right transfer, the Company would not control this Company. Therefore, it would
not be incorporated into consolidation scope since 1 Jun. 2014.
4. Main entities which are newly included into or are not included into
consolidation scope during the reporting period
Subsidiaries, special purpose entities and operation entities which formed their
control rights through method such as entrusted management or accepting leases that
newly included into consolidation scope during the reporting period.
Unit: RMB Yuan
Net profits of the reporting
Name Closing net assets
period
Subsidiaries, special purpose entities and operation entities which formed their
control rights through method such as entrusted management or accepting leases which
not newly included into consolidation scope during the reporting period.
Unit: RMB Yuan
Net profits from the
Name Net assets on the disposal date year-begin to the disposal
date
Konka Video & Communication 899,358.99 1,473,537.34
Other explanation of the entities newly included into consolidation scope and the
entities not included into
(1) There was no any subsidiary, special purpose entity and operation entity which
formed their control rights through method such as entrusted management or accepting
leases that newly included into consolidation scope during the reporting period.
(2) On 23 Jun. 2014, the Company disposed all of the 100% equity of Konka Video &
Communication and lost the control right, which was not included into the
consolidation scope any more.
5. Business combination under the same control during the reporting period
Unit: RMB Yuan
Judgment data Actual control Revenue from Net profits Cash flow of the
Combined party
attributed to person under the from the operation
134
the business the same period-begin to reporting activities from
combination control the combination period to the the reporting
under the same date of the combination period to the
control combination date of the combination
combination date of the
combination
Other explanation of the business combination under the same control
6. Business combination not under same control during the reporting period
Unit: RMB Yuan
Combined party Amount of the goodwill Calculation method of the goodwill
Other explanation of the business combination not under the same control
Whether there was any situation of multiple transactions which realized the enterprise merger step by step and
gained the control right during the reporting period?
□ Applicable √ Inapplicable
7. Subsidiaries reduced by selling equities without control right during the reporting period
Reorganization method of gains
Name of the subsidiary Sales date
and losses
Recognized the difference when
the consideration minusing the
disposed equity which entitled
the value lower than that of the
Konka Video & Communication 23 Jun. 2014
consolidation statement of the
Company when the subsidiary
disposing the daily net assets as
the disposing gains and losses.
Other explanation of the subsidiaries sold the equities without control right.
On 23 Jun. 2014, the Company transferred all of the 100% equity of Konka Video &
Communication to OCT Group. The selling date was the date that Company actually lost
the control right of the net assets, finance and operation decision of Konka Video
& Communication.
Whether there was situation of multiple transactions which disposed the investment of the subsidiaries step
by step till lost the control right during the reporting period?
□ Applicable √ Inapplicable
① The disposing price and the cash flow were listed as follows:
Item Amount
Disposing price 265,803,752.51
Cash and cash equivalence received when disposing 247,687,800.00
Less: cash and cash equivalence held by Konka Video & Communication 13,905,448.02
135
Item Amount
Cash net amount received when disposing 233,782,351.98
② The net assets when disposing Konka Video & Communication were listed as follows:
Item Net assets when disposing Last year
Current assets 76,412,504.99 202,438,108.09
Non-current assets 141,501,505.44 5,859,288.36
Current liabilities 215,814,651.44 206,721,574.80
Non-current liabilities 1,200,000.00 2,150,000.00
Total of net assets 899,358.99 -574,178.35
③ Calculation of the disposing of gains and losses were as follows:
Item Amount
Disposing price 265,803,752.51
Net assets of Konka Video & Communication on disposing date 899,358.99
Proportion of the Company 100%
Less: net assets amount of the Company enjoyed on disposing date 3,349,662.17
Add: amount of the other comprehensive income that related to Konka Video
& Communication that transferred in to the disposing of current gains and
losses —
Investment income when disposing 262,454,090.34
④ The income, expenses and profits of Konka Video & Communication from the
year-begin to the disposing date were as follows:
Item Amount
Income 44,076,837.32
Less: cost and expenses 44,395,937.09
Add: net amount of non-operation income and expenses 1,792,637.11
Total amount of profits 1,473,537.34
Less: income tax expenses
Net profits 1,473,537.34
8. The counter purchases in the reporting period
Calculation method of the
Basis of judging the Determination method of
Counter purchased party recognized goodwill or
counter purchases the combination cost
the gains and losses
136
accrued into the
reporting period of the
combination
Other explanation of the counter purchases
9. Mergers in the reporting period
Unit: RMB Yuan
Type of the mergers Main assets mergered Main liabilities mergered
Mergers under the same control Item Amount Item Amount
Mergers not under the same control Item Amount Item Amount
Other explanation of the mergers
10. Exchange rates of major items in financial statements for foreign entities
Item of assets and liabilities
Item
30 Jun. 2014 31 Dec. 2013
USA Konka USD 1 = RMB 6.1528 USD 1 = RMB 6.0969
Hong Kong Konka, Konka
Household Appliances
Investment, Konka
Household Appliances
Trade HKD 1= RMB 0.79375 HKD 1= RMB 0.7862
Indonesia Konka IDR 100= RMB 0.05237 IDR 100= RMB 0.04978
Europe Konka EUR 1 = RMB 8.3946 EUR 1 = RMB 8.4189
Item of income, expense and cash flow
Item
First half year of 2014 First half year of 2013
USA Konka USD 1 = RMB 6.1387 USD 1 = RMB 6.1928
Hong Kong Konka, Konka
Household Appliances
Investment, Konka
Household Appliances
Trade HKD 1 = RMB 0.7915 HKD 1 = RMB 0.7984
Indonesia Konka IDR 100= RMB 0.05289 IDR 100= RMB 0.05948
Europe Konka EUR 1 = RMB 8.4180 EUR 1 = RMB 8.2211
VII. Notes on major items in consolidated financial statements of the Company
1. Monetary funds
Unit: RMB Yuan
Closing balance Opening balance
Item
Amount in Exchang Amount in RMB Amount in Exchang Amount in RMB
137
foreign e rate foreign e rate
currency currency
Cash: -- -- 31,099.17 -- -- 18,884.53
RMB -- -- 6,565.54 -- -- 15,434.03
HKD 496.29 0.79375 393.93 282.31 0.7862 221.95
USD 476.59 6.1528 2,932.36 79.73 6.0969 486.10
40,495,213.9 0.00052 0.00049
21,207.34 5,509,145.45 2,742.45
EUR 3 37 78
1,632,020,574 1,771,470,536.6
-- -- -- --
Bank deposit: .55 8
1,295,207,885 1,459,709,622.3
-- -- -- --
RMB .61 2
12,523,490.1 14,308,150.6
0.79375 9,940,520.27 0.7862 11,249,068.07
HKD 1 9
52,555,654.2 323,364,429.7 48,845,385.9
6.1528 6.0969 297,805,433.63
USD 9 2 6
EUR 354,654.33 8.3946 2,977,181.24 230,458.44 8.4189 1,940,206.56
GBP 1.32 10.4978 13.86 1.32 10.0556 13.27
1,012,991,61 0.00052 1,539,041,19 0.00049
IDR 530,503.71 766,134.71
3.30 37 8.51 78
Other 6.96 5.7686 40.15 10.15 5.7259 58.12
Other monetary 213,398,737.0
-- -- -- -- 72,253,668.73
funds: 6
RMB -- -- 50,400,913.80 -- -- 66,730,960.14
26,491,649.8 162,997,823.2
USD 6.1528 905,822.40 6.0969 5,522,708.59
6 6
1,845,450,410 1,843,743,089.9
Total -- -- -- --
.78 4
If there was any account limited by being mortgaged, pledged or frozen, deposited overseas or with potential
collecting risks of the Company during the reporting period should explain individually
2. Trading financial assets
(1) Trading financial assets
Unit: RMB Yuan
Item Closing fair value Opening fair value
138
(2) Trading financial assets with realizable limit
Unit: RMB Yuan
Other significant restriction of the
Item Closing amount
restricted conditions or the realization
(3) Hedging instruments and notes to relevant hedging transaction
3. Notes receivable
(1) Category of notes receivable
Unit: RMB Yuan
Category Closing amount Opening amount
Banker's acceptance bill 3,155,022,771.85 4,148,179,374.32
Commercial acceptance bill 900,000.00 2,600,000.00
Total 3,155,922,771.85 4,150,779,374.32
(2) Notes receivable pledged at period-end
Unit: RMB Yuan
Issuing entity Issuing date Maturity date Amount Remark
Beijing Jingdong Beijing Jingdong
Century Information Century Information
Technology Co., Technology Co.,
Ltd. 2014/5/29 2014/8/29 23,043,104.70 Ltd.
Beijing Jingdong Beijing Jingdong
Century Information Century Information
Technology Co., Technology Co.,
Ltd. 2014/5/19 2014/8/19 13,801,183.52 Ltd.
Nanning Gome Nanning Gome
Logistics Co., Ltd. 2014/3/7 2014/9/7 10,000,000.00 Logistics Co., Ltd.
Nanning Gome Nanning Gome
Logistics Co., Ltd. 2014/3/7 2014/9/7 10,000,000.00 Logistics Co., Ltd.
Kunming Gome Kunming Gome
Logistics Co., Ltd. 2014/3/7 2014/9/7 10,000,000.00 Logistics Co., Ltd.
Total 66,844,288.22 Total
(3) Notes transferred to accounts receivable because drawer of the notes fails to execute the contract or
agreement, and undue notes endorsed to other parties at the end of the period
Notes transferred to accounts receivable because drawer of the notes fails to executed the contract or agreement
139
Unit: RMB Yuan
Issuing entity Issuing date Maturity date Amount Remark
Total -- -- --
Notes:
Notes that are endorsed but not due of Company
Unit: RMB Yuan
Issuing entity Issuing date Maturity date Amount Remark
Changchun Suning
Cloud Commercial 9 May 2014 9 Nov. 2014 10,000,000.00
Sales Co., Ltd.
Suning Purchasing
Center of Suning
15 Feb. 2014 15 Aug. 2014 10,000,000.00
Cloud Commercial
Group Co., Ltd.
Suning Purchasing
Center of Suning
15 Feb. 2014 15 Aug. 2014 10,000,000.00
Cloud Commercial
Group Co., Ltd.
Suning Purchasing
Center of Suning
29 Apr. 2014 28 Oct. 2014 7,364,521.99
Cloud Commercial
Group Co., Ltd.
Suning Purchasing
Center of Suning
27 Dec. 2013 27 Jun. 2014 7,317,401.06
Cloud Commercial
Group Co., Ltd.
Total -- -- 44,681,923.05 --
Notes:
Explanation of the discounted or pledged trade acceptance
4. Dividends receivable
Unit: RMB Yuan
Whether
there was
Opening Closing Reason of impairment
Item Increase Decrease
amount amount unreturned of the
relevant
accounts
Of which: -- -- -- -- -- --
140
Of which: -- -- -- -- -- --
Notes:
5. Interest receivable
(1) Interest receivable
Unit: RMB Yuan
Item Opening amount Increase Decrease Closing amount
Income of deposit
2,898,419.90 9,281,764.21 6,359,363.33 5,820,820.78
interest
Total 2,898,419.90 9,281,764.21 6,359,363.33 5,820,820.78
(2) Overdue interest
Unit：RMB Yuan
The loan equity Overdue time( days) Amount of overdue interest
(3) Interest receivable
6. Accounts receivable
(1) Accounts receivable are listed according to category
Unit：RMB Yuan
Closing amount Opening amount
Book balance Bad debt provision Book balance Bad debt provision
Category
Amount Proport Amount Proport Amount Proport Amount Proportio
ion ion ion n
Accounts
receivable with
significant
103,35
individual amount 153,384 306,769 5,167,865
6.30% 0.20% 7,300. 3.76% 5.00%
and make ,966.13 .93 .00
00
independent
provision for bad
debt
Accounts receivable that make independent provision for bad debt by age combination
2,253,9 251,558 2,616, 256,068,7
Age group 92.58% 11.16% 95.25% 9.79%
19,498. ,687.27 862,12 63.63
141
83 4.57
2,253,9 2,616,
Subtotal of 251,558 256,068,7
19,498. 92.58% 11.16% 862,12 95.25% 9.79%
combination ,687.27 63.63
83 4.57
Accounts
receivable not with
significant 27,085
27,330, 25,297, 25,071,33
individual amount 1.12% 92.56% ,525.4 0.99% 92.56%
228.20 571.29 6.44
but make independent 2
provision for bad
debt
2,434,6 2,747,
277,163 286,307,9
Total 34,693. -- -- 304,94 -- --
,028.49 65.07
16 9.99
Note:
There is no particular about closing balance of account receivable of shareholder entity of holding over 5%
shares of the Company in the reporting period.
Accounts receivable with significant individual amount and make independent provision for bad debt at closing
period
√ Applicable □ Inapplicable
Unit：RMB Yuan
Bad debt Withdrawal
Content Book balance Withdrawal ratio
provision reason
Shenzhen Konka Video &
Communication System Engineering 153,384,966.13 306,769.93 0.20% See Notes XIII
Co., Ltd.
Total 153,384,966.13 306,769.93 -- --
Accounts receivable are listed according to account age
√ Applicable □ Inapplicable
Unit：RMB Yuan
Closing amount Opening amount
Book balance Book balance
Item Bad debt Bad debt
Proport Proport
Amount provision Amount provision
ion ion
Within one year
Of which: -- -- -- -- -- --
Within one 1,913,082,237.6 2,273,369,466
84.87% 38,261,644.75 86.87% 45,467,389.34
year 4 .84
142
Subtotal of
1,913,082,237.6 2,273,369,466
Within one 84.87% 38,261,644.75 86.87% 45,467,389.34
4 .84
year
One to two 114,861,556.6
96,665,501.70 4.29% 4,833,275.09 4.39% 5,743,077.83
years 3
Two to three
36,227,781.90 1.61% 7,245,556.38 19,911,559.50 0.76% 3,982,311.90
years
Three to four
8,319,369.51 0.37% 4,159,684.76 6,653,659.08 0.25% 3,326,829.54
years
Four to five
5,132,163.59 0.23% 2,566,081.80 9,033,455.00 0.35% 4,516,727.50
years
Over five 193,032,427.5 193,032,427.5
194,492,444.49 8.63% 194,492,444.49 7.38%
years 2 2
Total 2,253,919,498.8 2,616,862,124 256,068,763.6
-- 251,558,687.27 --
3 .57 3
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□Applicable √Inapplicable
In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
□Applicable √Inapplicable
Accounts receivable not with significant individual amount but make independent provision for bad debt
√ Applicable □ Inapplicable
Unit：RMB Yuan
Content Book balance Bad debt provision Withdrawal ratio Reason
Involved with
Client 1 6,769,906.27 4,738,934.39 70.00%
lawsuit
Involved with
Client 2 1,223,622.25 1,223,622.25 100.00%
lawsuit
Difficult in
enterprise
operation and
Client 3 1,422,433.01 1,422,433.01 100.00% possibly cannot
execute the
repayment
obligation
Difficult in
enterprise
Client 4 16,978,047.94 16,978,047.94 100.00% operation and
possibly cannot
execute the
143
repayment
obligation
Difficult in
enterprise
operation and
Client 5 936,218.73 934,533.70 99.82% possibly cannot
execute the
repayment
obligation
Total 27,330,228.20 25,297,571.29 -- --
(2) Accounts receivable reversed or recovered in the reporting period
Unit：RMB Yuan
Reversed or
Recognition basis
Content of accounts Reversed or recovered amount of Reversed or
of original bad
receivable recovered reason the accrued bad debt recovered amount
debt provision
provision
The withdrawal of bad debt provision of accounts receivable with significant single amount or insignificant
single amount but individually made impairment test at the end of reporting period:
Unit: RMB Yuan
Content Book balance Bad debt provision Withdrawal ratio Reason
Notes to accounts receivable with insignificant single amount but large risks of groups after grouping by credit
risks characteristics
(3) The write-off accounts receivable
Unit: RMB Yuan
Whether arising
Nature of from related
Write-off Write-off
Name of entity accounts Write-off time party
amount reason
receivable transaction or
not?
Notes to write off of accounts receivable:
(4) Shareholders with more than 5% (including 5%) of the voting shares of the Company in
accounts receivable in reporting period
Unit: RMB Yuan
Closing amount Opening amount
Name of entity Amount Amount
Book balance Book balance
withdrawing withdrawing
144
bed-debt bed-debt
provision provision
(5) Information of top five accounts receivable:
Unit: RMB Yuan
The relationship
Name of entity Amount Aging Proportion
with the Company
Client 1 Customer 224,884,011.82 Within 1 year 9.86%
Client 2 Customer 205,836,110.07 Within 1 year 9.02%
Client 3 Customer 202,655,599.12 Within 1 year 8.88%
Client 4 Customer 155,461,694.39 Within 1 year 6.81%
Client 5 Customer 154,978,421.35 Within 1 year 6.79%
Total -- 943,815,836.75 -- 41.36%
(6) The amounts due from related parties
Unit: RMB Yuan
The relationship with the
Name of entity Amount Proportion
Company
Shanghai Konka Green
Joint Stock Company of the
Lighting Technology 5,449,283.73 0.25%
Company
Co., Ltd.
Shenzhen Refond
Joint Stock Company of the
Optoelectronics Co. 6,282,496.64 0.29%
Company
Ltd.
Shenzhen Refond
The same actual
Optoelectronics Co. 153,384,966.13 7.11%
controlling party
Ltd
Total 165,116,746.50 7.65%
(7) Accounts receivable derecognized
Unit: RMB Yuan
Profit or losses related to
Item Amount
derecognization
145
(8) Amount of assets and liabilities formed by using accounts receivable as a target for
securitization, listed and continuous involvement
Unit: RMB Yuan
Item Closing balance
Assets:
Liabilities:
(9) List of original amount of the foreign accounts receivable and the exchange rates
Item Closing amount Opening amount
Foreign currency Exchange Convert into Foreign currency Exchange Convert into
amount rate Renminbi amount rate Renminbi
639,711,758.7
USD 104,924,102.20 6.0969
108,341,677.42 6.1528 666,604,672.84 0
HKD 123,972.09 0.79375 98,402.85 2,170,681.57 0.7862 1,706,589.85
EUR 1,008,371.25 8.3946 8,464,873.30 391,085.69 8.4189 3,292,511.32
22,722,316,482.7
IDR 14,444,305,477.66 0.0004978 7,190,375.27
2 0.0005237 11,899,677.14
AUD 49,764.00 5.8064 288,949.69 49,764.00 5.4301 270,223.50
7. Other accounts receivable
(1) Other accounts receivable disclosed by Category
Unit: RMB Yuan
Closing balance Opening balance
Provision for bad Provision for bad
Book balance Book balance
Category debts debts
Propor Propor Proport Propor
Amount Amount Amount Amount
tion tion ion tion
Other accounts receivable that provisions for bad debts by group
324,169,9 100.00 27,357,75 321,659,0 22,909,588
Aging group 8.44% 100.00% 7.12%
60.09 % 6.85 03.24 .29
324,169,9 100.00 27,357,75 321,659,0 22,909,588
Subtotal of group 8.44% 100.00% 7.12%
60.09 % 6.85 03.24 .29
Total 324,169,9 -- 27,357,75 -- 321,659,0 -- 22,909,588 --
146
60.09 6.85 03.24 .29
Notes to category of other accounts receivable:
There was no any shareholder with more than 5% (including 5%) of the voting shares
of the Company in accounts receivable in reporting period.
(2) Other accounts receivable listed by aging
Closing amount Opening amount
Item
Amount Proportion (%) Amount Proportion (%)
Within 1 year 168,893,385.43 52.10 257,598,340.37 80.08
1 to 2 years 129,942,749.47 40.08 37,263,771.00 11.59
2 to 3 years 5,808,014.76 1.79 11,910,476.35 3.70
3 to 4 years 5,028,490.71 1.55 1,711,938.72 0.53
4 to 5 years 1,380,832.70 0.43 1,036,216.98 0.32
Over 5 years 13,116,487.02 4.05 12,138,259.82 3.78
Total 324,169,960.09 100.00 321,659,003.24 100.00
Other accounts receivable with significant single amount and individually withdrawn bad debt provision
□ Applicable √ Inapplicable
In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing amount Opening amount
Book balance Book balance
Item Bad debt Bad debt
Prop Prop
Amount orti provision Amount orti provision
on on
Within one year
Of which:
52.1 257,598,340.3 80.0
Within one year 168,893,385.43 3,377,867.70 5,151,966.80
0% 7 8%
Subtotal of Within 52.1 257,598,340.3 80.0
168,893,385.43 3,377,867.70 5,151,966.80
one year 0% 7 8%
One to two years 40.0 11.5
129,942,749.47 6,497,137.47 37,263,771.00 1,863,188.55
8% 9%
Two to three years 1.79 3.70
5,808,014.76 1,161,602.95 11,910,476.35 2,382,095.27
% %
147
1.55 0.53
Three to four years 5,028,490.71 2,514,245.36 1,711,938.72 855,969.36
% %
0.43 0.32
Four to five years 1,380,832.70 690,416.35 1,036,216.98 518,108.49
% %
4.05 3.78
Over five years 13,116,487.02 13,116,487.02 12,138,259.82 12,138,259.82
% %
Total 321,659,003.2
324,169,960.09 -- 27,357,756.85 -- 22,909,588.29
4
In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt provision
□Applicable√ Inapplicable
In the groups, other accounts receivable adopting other methods to withdraw bad debt provision
□Applicable√ Inapplicable
Other accounts receivable not with significant individual amount but make independent provision for bad debt
□Applicable√ Inapplicable
(2) Information of other accounts receivable reversed or recovered in the reporting period
Unit: RMB Yuan
Reason for Basis for Accrued amount
Content of other Amount of reversed
reversed or determination of before reversal or
accounts receivable or recovered
recovered bad debts provision recovery
Withdrawal of closing individually significant or insignificant but provisions for bad debts individually
accounts receivable:
Unit: RMB Yuan
Withdrawal
Content Book balance Amount of bad debts Reason
percentage
Notes of individually insignificant but was of big risk after grouped by credit risk other accounts receivable:
(3) The write-off other accounts receivable
Unit: RMB Yuan
Whether arising
Nature of other
Write-off Write-off from related party
Name of entity accounts Write-off time
amount reason transaction or
receivable
not?
Notes to write off of accounts receivable:
(4) Shareholders with more than 5% (including 5%) of the voting shares of the Company in
other accounts receivable in reporting period
Unit: RMB Yuan
148
Closing amount Opening amount
Amount Amount
Name of entity withdrawing withdrawing
Book balance Book balance
bed-debt bed-debt
provision provision
(5) Nature or details of other significant accounts receivable
Unit: RMB Yuan
Nature or details of
Name of entity Amount Proportion of the total
the amount
Notes
(6) Information of top five other accounts receivable
Unit: RMB Yuan
Relationship with Proportion of the
Name of entity Amount Aging
the Company total
Client 1 Non-related party 152,326,500.00 Within 2 years 46.99%
Shareholder of the
Client 2 subsidiary of the 42,495,725.46 Within 1 year 13.11%
Company
Client 3 Non-related party 5,460,390.00 1 to 2 years 1.68%
Client 4 Non-related party 2,570,568.00 Within 1 year 0.79%
Client 5 Non-related party 2,480,401.90 1 to 2 years 0.77%
Total -- 205,333,585.36 -- 63.34%
(7) Information of the amounts due from related parties
Unit: RMB Yuan
Relationship with the
Name of entity Amount Proportion of the total
Company
Shenzhen Overseas
The same actual
Chinese Town Gas Station 80,000.00 0.03%
controlling party
Co., Ltd.
Shenzhen OCT Real Estate The same actual
1,209,064.86 0.41%
Co., Ltd controlling party
Shenzhen OCT Property The same actual
77,402.65 0.03%
Management Co., Ltd controlling party
Shenzhen OCT Water and The same actual 1,640,550.61 0.55%
149
Power Co., Ltd controlling party
Total 1.01%
(8) Other accounts receivable derecognized
Unit: RMB Yuan
Profit or losses related to
Item Amount
derecognization
(9) Amount of assets and liabilities formed by using other accounts receivable as a target
for securitization, listed and continuous involvement
Unit: RMB Yuan
Item Closing balance
Assets:
Liabilities:
(10) Governmental subsidy derecognized by account receivable in the end of reporting period
Unit: RMB Yuan
Reason of
failing to
Estimated Estimated receive the
Name of Name of the Closing Closing
receiving receiving Judgment estimated
entity project balance aging
time amount amount at
estimated time
(if any)
(11) List of the original amount of the foreign currency of other accounts receivable
and the exchange rates
Closing amount Opening amount
Item Foreign currency Exchange Convert into Foreign currency Exchange Convert into
amount rate Renminbi amount rate Renminbi
USD 803,923.30 6.1528 4,946,379.28 258,590.65 6.0969 1,576,601.33
HKD 56,501.10 0.79375 44,847.75 75,680.14 0.7862 59,499.73
EUR 3,779.14 8.3946 31,724.37 3,749.97 8.4189 31,570.62
IDR 149,872,086.50 0.0005237 78,488.01 423,230,364.50 0.0004978 210,684.08
150
8. Prepayment
(1) List by aging analysis
Unit: RMB Yuan
Closing balance Opening balance
Aging Proportio Proportio
Amount Amount
n n
Within 1
730,060,919.07 99.61% 162,235,497.39 98.76%
year
1 year to 2
2,104,718.42 0.29% 1,559,201.36 0.95%
years
2 years to 3
742,875.11 0.10% 478,230.84 0.29%
years
Over 3
0.00 0.00% 0.00 0.00%
years
Total 732,908,512.60 -- 164,272,929.59 --
Notes of aging of prepayment
There was no any shareholder with more than 5% (including 5%) of the voting shares of the Company in prepayment
in reporting period.
(2) Information of the top five prepayment equities
Unit: RMB Yuan
Relationship with Reason for
Name of entity Amount Aging
the Company unsettled
Prepayment of land
Supplier 1 Non-related party 488,063,979.00 Y2014
account
Prepayment of
Supplier 2 Non-related party 71,046,108.81 Y2014
materials account
Prepayment of
Supplier 3 Non-related party 13,888,945.86 Y2014
materials account
Prepayment of
Supplier 4 Non-related party 9,530,329.96 Y2014
materials account
Prepayment of
Supplier 5 Non-related party 6,799,573.07 Y2014
materials account
Total -- 589,328,936.70 -- --
Notes of important companies of prepayment:
(3) Shareholders with more than 5% (including 5%) of the voting shares of the Company in
151
prepayment in reporting period
Unit: RMB Yuan
Closing amount Opening amount
Amount Amount
Name of entity withdrawing withdrawing
Book balance Book balance
bed-debt bed-debt
provision provision
(4) Note to prepayment
9. Inventory
(1) Category
Unit: RMB Yuan
Closing balance Opening balance
Impairment
Impairment
Item of
Book balance Book value Book balance of Book value
inventorie
inventories
s
1,070,472,497 297,042,07 773,430,425. 1,122,928,41 337,943,507. 784,984,908.
Raw materials
.30 1.79 51 6.97 99 98
Construction 333,637,409.6 180,262,68 153,374,727. 346,780,797. 180,414,495. 166,366,301.
contract assets 1 1.85 76 38 68 70
2,005,173,449 266,611,41 1,738,562,03 2,327,973,29 258,385,468. 2,069,587,83
Inventory goods
.44 2.07 7.37 9.87 08 1.79
Turnover 1,041,221.
8,375,534.40 7,334,313.37 5,144,913.85 1,041,221.03 4,103,692.82
material 03
Development 614,928,538.4 614,928,538. 557,626,288. 557,626,288.
cost 6 46 97 97
4,032,587,429 744,957,38 3,287,630,04 4,360,453,71 777,784,692. 3,582,669,02
Total
.21 6.74 2.47 7.04 78 4.26
(2) Impairment of inventories
Unit: RMB Yuan
Opening book Decrease Closing book
Category Increase
balance Reversal Written off balance
Raw materials 337,943,507.99 3,681,972.84 44,583,409.04 297,042,071.79
Construction 180,414,495.68 151,813.83 180,262,681.85
152
contract assets
Inventory goods 258,385,468.08 33,818,633.22 25,592,689.23 266,611,412.07
Turnover material 1,041,221.03 1,041,221.03
Total 777,784,692.78 37,500,606.06 70,327,912.10 744,957,386.74
(3) Details of provision for falling price of inventories
Proportion of reversal of
Basis on provision for
provision for impairment
Item falling price of Reasons for reversal
of inventories to closing
inventories
balance
Realizable net value for
Raw materials the products is lower than —
the cost
Realizable net value for
the products is lower than —
Inventory goods the cost
Realizable net value for
Construction contract
the products is lower than —
assets
the cost
Realizable net value for
Turnover material the products is lower than —
the cost
Notes of inventory
① The amount of the current capitalization interests among the development cost
was of RMB 356,256.69.
② Up to 30 Jun. 2014, the land use right which was of the book value of RMB
264,604,094.91 among the development cost was used for pledging the long-term
borrowings which was of RMB 19,990,000 (see Notes VII. 42).
10. Other current assets
Unit: RMB Yuan
Item Closing balance Opening balance
Financial products 400,000,000.00
Other 18,115,952.51
Total 418,115,952.51
Notes of other current assets:
153
11. Available-for-sale financial assets
(1) Information of available-for-sale financial assets
Unit: RMB Yuan
Item Closing fair value Opening fair value
Debt instrument available-for-sale 970,153.70 941,999.30
Total 970,153.70 941,999.30
In the reporting period, the Company reclassified the held-to-maturity investment into available-for-sale
financial assets, a total of RMB0.00 was reclassified, which takes 0% of total matured investment before
reclassification.
Notes of available-for-sale financial assets:
(2) Long-term debt investment in available-for-sale financial assets
Unit: RMB Yuan
Accumulat
ive
Initial interest
Face Maturity Opening Current Closing
Item Type investmen receivabl
value date balance interest balance
t cost e or
interest
received
Note to long-term debt investment in available-for-sale financial assets
(3) Impairment available-for-sale financial assets
Unit: RMB Yuan
Available-for-sal Available-for-sale
Classification e equity liability Other Total
instruments instruments
Cost of equity instrument/
amortized cost of liability 2,311,748.07 0.00 2,311,748.07
instrument
Closing fair value 970,153.70 0.00 970,153.70
Changed amount of the fair
value accumulatively included
28,154.40 0.00 28,154.40
into other comprehensive
income
Amount of the withdrawn
1,369,748.77 0.00 1,369,748.77
impairment
154
(4) Particulars about change in impairment available-for-sale financial assets
Unit: RMB Yuan
Available-for- Available-for-s
Classification sale equity ale liability Other Total
instruments instruments
Opening amount of
1,369,748.77 1,369,748.77
impairment provision
Closing amount of
1,369,748.77 1,369,748.77
impairment provision
(5) Particulars about the closing fair value of available-for-sale equity instruments falling
sharply or continuously
Unit: RMB Yuan
Available- The
for-sale falling Reason of impairment
continuous amount of
equity fair of cost provision not according to
Cost ly falling impairment
instrument value relative the difference between the
time provision
s to fair cost and closing fair value
(subentry) value
12. Held-to-maturity investment
(1) Information
Unit: RMB Yuan
Item Closing book balance Opening book balance
Notes:
(2) Particular about sale in the reporting period but not held-to-maturity investment
Unit: RMB Yuan
Item Amount The proportion of the investment before sale
Notes:
13. Long-term accounts receivable
Unit: RMB Yuan
Category Closing balance Opening balance
155
14. Investment to joint ventures and associated enterprises
Unit: RMB Yuan
Total
Voting
Percentage Total operation Net profit
percentage Total
Name of of holding closing Net closing revenue of of the
of the closing
investee shares of liabilitie assets the reporting
Company in assets
the Company s reporting period
investee
period
I. Joint ventures
II. Associated enterprises
Shenzhen
Refond
Optoelectr 18.90% 18.90%
onics Co.,
Ltd
Enray Tek
Optoelectr 581,592,07 301,459,47 280,132,60 49,861,829 -3,204,359
33.16% 33.16%
onic Co., 5.39 2.24 3.15 .96 .66
Ltd
Shenzhen
Konka
13,767,056 1,643,585. 12,123,470
Energy 30.00% 30.00%
.15 59 .56
Technology
Co., Ltd
Shanghai
Konka Green 628,716,27 101,717,41 526,998,85 77,088,855 -7,819,659
39.00% 39.00%
Technology 0.94 9.18 1.76 .89 .41
Co., Ltd.
Shenzhen
Qianhai
Qingsong
Venture
Capital 76,000,975 75,962,976
6.00% 6.00% 37,999.50 -36,024.00
Fund .50 .00
Management
Enterprise
(Limited
partner)
Notes if significant differences exist between the important accounting policies and accounting estimations
of joint ventures, associated enterprises and the Company:
156
15. Long-term equity investment
(1) Category of long-term equity investment
Increase of the
Decrease of the
Item Opening amount reporting Closing amount
reporting period
period
Investment in joint venture —
Investment in affiliated bu
siness 428,065,074.59 9,895,503.29 2,175,501.89 435,785,075.99
Other equity investment 19,975,424.83 19,975,424.83
Less: depreciation provision
of long-term equity
investment 1,885,000.00 1,885,000.00
Total 446,155,499.42 9,895,503.29 2,175,501.89 453,875,500.82
(2) List of long-term equity investment
Unit: RMB Yuan
Explan
ation
for
indiff
erence
s Withdr
Share betwee awn
holdin Voting n the impair Cash
Initia
Openin Closin g percen share Impair ment bonus
Accoun l Increa
Invest g g percen tage holdin ment provis in the
ting invest se/dec
ee balanc balanc tage in g provis ion in report
method ment rease
e e in invest percen ion the ing
cost
invest ee tage report period
ee and ing
voting period
percen
tage
in
invest
ee
157
Shenzh
en
Refond
26,983 114,29 118,01
Optoel Equity 3,712,
,691.7 9,265. 1,831. 18.90% 18.90% —
ectron method 566.58
9 34 92
ics
Co.,
Ltd
Enray
Tek
Optoel 148,03 108,63 108,81
Equity 182,93
ectron 6,152. 3,724. 6,660. 33.16% 33.16% —
method 6.71
ic 86 22 93
Co.,
Ltd
Shenzh
en
Konka
Energy Equity 5,983, 3,649, 3,649,
30.00% 30.00% —
Techno method 965.19 728.08 728.08
logy
Co.,
Ltd
Shenzh
en
Konka
Equity 3,000, 7,137, 7,137,
Electr 30.00% 30.00% —
method 000.00 424.83 424.83
onics
Co.,
Ltd.
Feihon
g
Electr Cost 1,300, 1,300, 1,300, 1,300,
8.33% 8.33% —
onics method 000.00 000.00 000.00 000.00
Co.,
Ltd.
Shenzh
en
Associ
Cost 100,00 100,00 100,00 100,00
ation —
method 0.00 0.00 0.00 0.00
of
Enterp
rises
158
with
Foreig
n
Invest
ment
Shenzh
en
Make-p
lan
Invest Cost 485,00 485,00 485,00 485,00
1.00% 1.00% —
ment method 0.00 0.00 0.00 0.00
Develo
pment
Co.,
Ltd.
IGRS
Inform
ation
Techno
logy Cost 5,000, 5,000, 5,000,
9.62% 9.62% —
Engine method 000.00 000.00 000.00
ering
Center
Co.,
Ltd.
Shenzh
en CTU Cost 1,153, 1,153, 1,153,
11.50% 11.50% —
Hi-tec method 000.00 000.00 000.00
h Ltd.
Shenzh
en
Digita
l TV
Nation
Cost 2,400, 2,400, 2,400,
al 6.00% 6.00% —
method 000.00 000.00 000.00
Engine
ering
Lab
Co.,
Ltd.
Shangh
Cost 2,400, 2,400, 2,400,
ai 4.26% 4.26% —
method 000.00 000.00 000.00
Digita
159
l TV
Nation
al
Engine
ering
R&D
Center
Co.,
Ltd.
Shangh
ai
Konka
202,80 201,48 -2,175 199,30
Green Equity
0,000. 2,356. ,501.8 6,855. 39.00% 39.00% —
Techno method
00 95 9 06
logy
Co.,
Ltd.
Shenzh
en
Qianha
i
Qingso
ng
Ventur
e
Capita Cost 6,000, 6,000, 6,000,
6.00% 6.00% —
l Fund method 000.00 000.00 000.00
Manage
ment
Enterp
rise
(Limit
ed
partne
r)
405,64 448,04 455,76
7,720, 1,885,
Total -- 1,809. 0,499. 0,500. -- -- --
001.40 000.00
84 42 82
(3) Limitation of the ability to transfer funds to investment enterprises
Unit: RMB Yuan
Item Reason The cumulative investment losses
160
amount unrecognized in current
period
Notes:
(4) List of the impairment provision of long-term equity investment
Decrease of the
Increase of the
Item Opening amount reporting Closing amount
reporting period
period
Shenzhen Make-plan Investment — —
Development Co., Ltd. 485,000.00 485,000.00
— —
Feihong Electronics Co., Ltd. 1,300,000.00 1,300,000.00
— —
Shenzhen Association of
Enterprises with Foreign
Investment 100,000.00 100,000.00
— —
Total 1,885,000.00 1,885,000.00
16. Investment property
(1) List of investment property
Increase of the
Decrease of the
Item Opening amount reporting Closing amount
reporting period
period
Investment property adopting the
cost mode to have subsequent 237,986,524.12 — 2,803,925.33 235,182,598.79
measurement
Less: impairment provision of
— —
investment real estate
Total 237,986,524.12 — 2,803,925.33 235,182,598.79
(2) Investment property calculated by cost
Unit: RMB Yuan
Item Opening book balance Increase Decrease Closing book balance
I. Total cost 248,881,997.54 248,881,997.54
1. Property and 248,881,997.54 248,881,997.54
161
buildings
II Accumulated
depreciation and 10,895,473.42 2,803,925.33 13,699,398.75
amortization
1. Property and
10,895,473.42 2,803,925.33 13,699,398.75
buildings
III. Total book
value of
237,986,524.12 -2,803,925.33 0.00 235,182,598.79
investment real
estate
1. Property and
237,986,524.12 -2,803,925.33 0.00 235,182,598.79
buildings
V. Total book
value of
237,986,524.12 -2,803,925.33 235,182,598.79
investment real
estate
1. Property and
237,986,524.12 235,182,598.79
buildings
Unit: RMB Yuan
The reporting period
Amount of amortization and depreciation in the reporting
2,803,925.33
period
(3) Investment property calculated by fair value
Unit: RMB Yuan
Increase Decrease
Self-use Changes
property in fair
Opening Transfer Closing
or value
Item fair into fair
Purchase transfer recogniz Disposal
value self-use value
red by ed in
property
inventor profits
y or loss
1. Total cost 0.00 0.00
2. Total change of fair
0.00 0.00
value
3. Total book value of
0.00 0.00
investing property
Note of change measurement model of the investment real estate and the investment real estate had not completed
162
the property right certificate, explain the reason and the estimated completing time.
Up to 30 Jun. 2014, the above mentioned investment property were not completed the
housing authority.
17. Fixed assets
(1) Fixed assets details
Unit: RMB Yuan
Decrease in the
Opening book Closing book
Item Increase in the reporting period reporting
balance balance
period
I. Total original book 3,296,096,765 3,284,698,186
177,985,739.76 189,384,318.72
value .14 .18
Including: Property 1,697,364,872 1,707,866,043
147,428,848.95 136,927,678.18
and building .78 .55
1,077,095,834 1,052,151,072
Machineries 12,778,964.22 37,723,726.63
.75 .34
Vehicles 74,040,180.94 1,862,341.83 2,071,710.28 73,830,812.49
252,082,489.3 253,898,567.3
Electronic equipment 9,541,318.65 7,725,240.72
7 0
195,513,387.3 196,951,690.5
Other equipment 6,374,266.11 4,935,962.91
0 0
Increase in
Withdrawing in Decrease in the
Opening book the Closing book
-- the reporting reporting
balance reporting balance
period period
period
II. Total accumulated 1,373,882,997 68,425,826.8 1,398,386,598
43,922,226.19
depreciation： .76 2 .39
Including: Property 378,833,362.7 20,483,260.7 398,546,405.2
770,218.26
and building 6 4 4
606,302,322.7 30,555,133.4 607,198,892.5
Machineries 29,658,563.61
3 4 6
Vehicles 53,846,303.98 3,560,969.77 1,603,538.96 55,803,734.79
206,847,412.3 205,153,956.4
Electronic equipment 5,128,876.56 6,822,332.51
8 3
128,053,595.9 131,683,609.3
Other equipment 8,697,586.31 5,067,572.85
1 7
163
Opening book Closing book
-- --
balance balance
III. Total net book 1,922,213,767 1,886,311,587
--
value .38 .79
Including: Property 1,318,531,510 1,309,319,638
--
and building .02 .31
470,793,512.0 444,952,179.7
Machineries --
2 8
Vehicles 20,193,876.96 -- 18,027,077.70
Electronic equipment 45,235,076.99 -- 48,744,610.87
Other equipment 67,459,791.39 -- 65,268,081.13
IV. Total provisions
13,709,787.58 -- 13,825,901.24
for depreciation
Including: Property
2,451,004.74 -- 2,451,004.74
and building
Machineries 6,876,144.66 -- 6,994,285.12
Vehicles 847,673.85 -- 847,673.85
Electronic equipment 1,945,464.65 -- 1,943,437.85
Other equipment 1,589,499.68 -- 1,589,499.68
1,908,503,979 1,872,485,686
V. Total book value --
.80 .55
Including: Property 1,316,080,505 1,306,868,633
--
and building .28 .57
463,917,367.3 437,957,894.6
Machineries --
6 6
Vehicles 19,346,203.11 -- 17,179,403.85
Electronic equipment 43,289,612.34 -- 46,801,173.02
Other equipment 65,870,291.71 -- 63,678,581.45
Notes: Depreciation amount in 2014 was RMB 68,425,826.82. Original value of fixed assets transferred from project
in process in 2014 was RMB 2,571,340.21.
(2) Limitation of the ownership of the fixed assets
As of 30 Jun. 2014, the Company gained short term loan of RMB 55 million by mortgaging
house and buildings with book value of RMB 44,161,334.77 (Original value RMB
51,696,497.26) ( for details, please refer to note VII, 29).
164
(2) Temporary idle fixed assets
Unit: RMB Yuan
Book original Accumulated Provision for
Item Book value Remark
value depreciation impairment
House and
56,002,044.54 29,580,820.79 1041162.02 25,380,061.73
buildings
Mechanical
21,727,081.05 17,951,988.65 2,347,498.32 1,427,594.08
equipments
Vehicles 3,152,578.80 2,825,650.99 35,702.87 291,224.94
Electronical
20,293,901.76 18,363,491.31 1,504,232.16 426,178.29
equipments
Other
6,014,548.50 5,282,672.61 249,331.80 482,544.09
equipments
(3) Fixed assets leased in from financing lease
Unit: RMB Yuan
Item Book value Accumulated depreciation Net book value
House and buildings 5,321,552.85 496,504.95 4,825,047.90
Mechanical equipments
Vehicles
(4) Fixed assets rent out by operational lease
Unit: RMB Yuan
Category of assets rent out by operational lease Closing book value
House and buildings 19,621,392.95
(5) Particulars about available for sale fixed assets at closing period
Unit: RMB Yuan
Estimated disposal Estimated disposal
Item Book value Fair value
expense time
(6) Particulars about fixed assets whose certificates of title are not prepared
Item Reason Estimated completing time
Has not obtained the state-owned
Yikang building of Group
land uses card, can not to deal with Cannot predict estimate
headquarter
house property card
R&D mansion Under processing Cannot predict estimate
165
Legal disputes, has won the case,
Jingyuan office building Cannot predict estimate
certificate is under processing
Office building of Changshu Konka Has not obtained land uses card, can
Cannot predict estimate
Color TV etc. not to deal with house property card
The water club Under processing Cannot predict estimate
Has not obtained the state-owned
Mudangjiang electric appliances
land uses card, can not to deal with Cannot predict estimate
etc.
house property card
Note:
18. Construction in progress
(1) Information about construction in progress
Unit: RMB Yuan
Closing amount Opening amount
Item Book Impairment Book Impairment
Book value Book value
balance provision balance provision
23,680,639 23,680,639 18,495,377 18,495,377.3
Kunshan Hotel project
.38 .38 .38 8
1,643,881. 1,643,881. 1,643,881.
Kunshan Gallery project 1,643,881.07
07 07 07
Kunshan Geraint new 18,926,682 18,926,682 9,556,522.
9,556,522.65
factory .85 .85 65
Chuzhou Geraint plant 3,048,390. 3,048,390.
136,383.03 136,383.03
construction phase I 83 83
Wuhan Geraint 11,618,352 11,618,352
68,714.00 68,714.00
industrial park .38 .38
1,001,759.
Project to be installed 50,000.00 50,000.00 1,001,759.03
03
43,581,023 43,581,023 19,021,390 19,021,390.8
Other small projects
.51 .51 .81 1
102,548,97 102,548,97 49,924,027 49,924,027.9
Total
0.02 0.02 .97 7
(2) Significant changes in construction in progress
Unit: RMB
Yuan
Name Openi Trans Proje Proje Capit Inclu Capit Sourc Closi
Budge Other
ng Incre ferre
of decre ct ct aliza ding: aliza e of ng
t balan ase d to
ase
proje ce fixed input proce tion capit tion fundi balan
166
ct asset perce ss of aliza of ng ce
s
ntage inter tion inter
of est of est
budge inter rate
t est (%)
this
perio
d
Kunsh
an 441,6 18,49 5,185 23,68
Owned
Hotel 00,00 5,377 ,262. 0,639
fund
proje 0.00 .38 00 .38
ct
Kunsh
an
26,32 1,643 1,643
Galle Owned
0,000 ,881. ,881.
ry fund
.00 07 07
proje
ct
Kunsh
an
7,980 9,556 9,370 18,92
Gerai Owned
,000. ,522. ,160. 6,682
nt new fund
00 65 20 .85
facto
ry
Chuzh
ou
Gerai
nt
31,68 2,912 3,048
plant 136,3 Owned
0,000 ,007. ,390.
const 83.03 fund
.00 80 83
ructi
on
phase
I
Wuhan
Gerai
13,78 11,54 11,61
nt 68,71 Owned
8,400 9,638 8,352
indus 4.00 fund
.00 .38 .38
trial
park
Proje 13,78 1,001 79,05 911,0 119,7 Owned 50,00
167
ct to 8,400 ,759. 9.83 75.28 43.58 fund 0.00
be .00 03
insta
lled
Other
19,02 26,22 1,660 43,58
small 5,692 Owned
1,390 5,589 ,264. 1,023
proje .30 fund
.81 .93 93 .51
cts
535,1 49,92 55,32 2,571 102,5
125,4
Total 56,80 4,027 1,718 ,340. -- -- -- -- 48,97
35.88
0.00 .97 .14 21 0.02
Note:
(3) Impairment provision of construction in progress
Unit: RMB Yuan
Increase in the Decrease in the
Reason for
Item Opening amount reporting reporting Closing balance
withdrawal
period period
(4) Particulars about the progress of significant construction in process
Item Progress Remark
Kunshan Hotel project 5.36% —
Kunshan Gallery project 6.00% —
Wuhan Geraint industrial park 38.00% —
(5) Note of construction in process
19. Project material
Unit: RMB Yuan
Increase in Decrease in the
Item Opening amount the reporting reporting Closing balance
period period
Note:
20. Disposal of fixed assets
Unit: RMB Yuan
Reason transfer into
Item Opening book value Closing book value
disposal
Note of the progress of fix assets transfer into disposal over one year
168
21. Productive biological asset
(1) Calculated by cost
Unit: RMB Yuan
Opening book Increase in the Decrease in the Closing book
Item
balance reporting period reporting period balance
I. Planting industry
II. Livestock
II. Forestry
IV. Fishing industry
(2) Calculated by fair value
Unit: RMB Yuan
Opening book Increase in the Decrease in the Closing book
Item
balance reporting period reporting period balance
I. Planting industry
II. Livestock
II. Forestry
IV. Fishing industry
Total 0.00 0.00 0.00 0.00
Note：
22．Oil and gas assets
Unit: RMB Yuan
Opening book Increase in the Decrease in the Closing book
Item
balance reporting period reporting period balance
Note:
23. Intangible assets
(1) Information
Unit: RMB Yuan
Opening book Increase in the Decrease in the Closing book
Item
balance reporting period reporting period balance
I. Total original book
442,439,507.25 1,982,778.29 444,422,285.54
value
169
Land use right 374,671,561.19 374,671,561.19
Trademark registration
costs in foreign 3,519,159.61 3,519,159.61
countries
Patents and proprietary
38,668,756.51 1,353,462.00 40,022,218.51
technologies
Others 25,580,029.94 629,316.29 26,209,346.23
II. Total accumulated
79,952,853.52 6,033,144.06 85,985,997.58
damage
Land use right 34,367,987.40 4,151,587.83 38,519,575.23
Trademark registration
costs in foreign 3,319,116.47 22,530.20 3,341,646.67
countries
Patents and proprietary
30,935,481.51 657,034.25 31,592,515.76
technologies
Others 11,330,268.14 1,201,991.78 12,532,259.92
III. Total net book
value of intangible 362,486,653.73 -4,050,365.77 0.00 358,436,287.96
assets
Land use right 340,303,573.79 -4,151,587.83 0.00 336,151,985.96
Trademark registration
costs in foreign 200,043.14 -22,530.20 0.00 177,512.94
countries
Patents and proprietary
7,733,275.00 696,427.75 0.00 8,429,702.75
technologies
Others 14,249,761.80 -572,675.49 0.00 13,677,086.31
IV. Total book value 2,901,082.61 2,901,082.61
Land use right
Trademark registration
costs in foreign
countries
Patents and proprietary
2,901,082.61 2,901,082.61
technologies
Others
Total book value of
359,585,571.12 -4,050,365.77 0.00 355,535,205.35
intangible assets
Land use right 340,303,573.79 -4,151,587.83 336,151,985.96
Trademark registration 200,043.14 -22,530.20 177,512.94
170
costs in foreign
countries
Patents and proprietary
4,832,192.39 696,427.75 5,528,620.14
technologies
Others 14,249,761.80 -572,675.49 13,677,086.31
Note: The amortized amount of the current period is RMB6, 033,144.06.
(2) Company development expense
Unit: RMB Yuan
Decrease
Recognized into Recognized as
Item Opening balance Increase Closing balance
current intangible
gains/losses assets
The percentage of development expense accounted for 90% of the total expenditure of R&D projects in the reporting
period.
The percentage of the value of intangible assets formed from the internal R&D of the Company accounted for 0%
of the closing book value of intangible assets.
Notes of the developed projects of the Company, including the projects with individual value more than RMB 1
million and recorded with the assessed value, relevant assessment agency and method shall be disclosed:
Note: ①The amortized amount of the current year is RMB6, 033,144.06.
②As of 30 Jun. 2014, the Company gained short term loan of RMB 55 million by
mortgaging house and buildings with book value of RMB 44,161,334.77 (Original value
RMB 51,696,497.26) ( for details, please refer to note VII, 29). Long term loan of
RMB 19.9 million was gained by mortgaging land using right of RMB 81,402,509.76
(Original value RMB 88,201,364.97).
24. Goodwill
Unit: RMB Yuan
Impairment
Increase in Decrease in
Name of investee or event Opening Closing provision
the reporting the reporting
that generated goodwill balance balance at
period period
period-end
Shaanxi Konka 316,980.96 316,980.96
Video Engineering 29,033.42 29,033.42
Anhui Konka 3,597,657.15 3,597,657.15
Total 3,943,671.53 29,033.42 3,914,638.11
171
Notes of test method of goodwill impairment and impairment withdrawal method:
(1) For details about method to test goodwill impairment and provision for impairment,
please refer to No. 35 in Note IV.
(2) As of 30 Jun. 2014, there was no book value higher than amount recoverable in
goodwill.
25. Long-term amortization expense
Unit: RMB Yuan
Reason for
Opening Amortization Other Closing
Item Increase other
balance balance decrease balance
decrease
Decoration
7,014,202.08 1,951,194.20 1,094,818.94 397,222.12 7,473,355.22
expenses
Other 6,390,882.86 843,892.53 833,075.29 6,401,700.10
13,405,084.9 13,875,055.3
Total 2,795,086.73 1,927,894.23 397,222.12 --
4 2
Note:
26. Deferred tax assets and liabilities
(1) Deferred tax assets and liabilities are not listed as the net value after offset
Deferred tax assets and liabilities that already recognized
Unit: RMB Yuan
Item Closing balance Opening balance
Deferred income tax assets:
Provision for impairment of assets 158,846,303.03 151,863,198.25
Deductible losses 9,673,216.54 15,581,935.44
Compensated for unrealized internal
11,914,747.18 12,279,905.48
profit
Warranty expenses 15,016,803.62 14,978,181.10
Other non-current liabilities-deferred
24,694,844.85 24,025,519.14
income
Subtotal 220,145,915.22 218,728,739.41
Deferred income tax liabilities:
valuation of trading financial
instruments, derivative financial 0.00
instruments
172
List of unrecognized deferred income tax assets
Unit: RMB Yuan
Item Closing balance Opening balance
Deductible temporary difference 476,417,633.92 467,226,060.72
Deductible losses 413,120,454.69 229,913,859.17
Total 889,538,088.61 697,139,919.89
Deductible losses of unrecognized deferred income tax assets will due in the following years
Unit: RMB Yuan
Year Closing balance Opening balance Remark
List of taxable differences and deductible differences items
Unit: RMB Yuan
Temporary differences amount
Item
Closing balance Opening balance
Taxable differences items
Deductible differences item
(2) Deferred tax assets and liabilities are listed as the net value after offset
Underlying exposures of deferred tax assets and liabilities after offset
Unit: RMB Yuan
Temporary Temporary
Deferred tax differences of Deferred tax differences of
assets or deferred tax assets or deferred tax
Item liabilities assets or liabilities assets or
after offset at liabilities after offset at liabilities
closing period after offset at opening period after offset at
closing period opening period
Deferred tax assets 220,145,915.22 218,728,739.41
Particulars of deferred tax assets and liabilities after offset
Unit: RMB Yuan
Item Amount of offset
Note:
27. List of provision for assets impairment
Unit: RMB Yuan
Opening book Decrease Closing book
Item Increase
balance Reversal Written off balance
173
I. Provision for bad 312,273,573.1
316,598,942.29 8,545,822.51 10,607,270.36 2,263,921.28
debt 6
II. Provision for 744,957,386.7
777,784,692.78 37,500,606.06 70,327,912.10
inventory falling price 4
III. Impairment
provision of
1,369,748.77 1,369,748.77
available-for-sale
financial assets
V. Impairment provision
of long-term equity 1,885,000.00 1,885,000.00
investment
VII. Impairment
provision of fixed 13,709,787.58 164,794.58 48,680.92 13,825,901.24
assets
XII. Impairment
provision of intangible 2,901,082.61 2,901,082.61
assets
1,114,249,254. 1,077,212,692
Total 46,211,223.15 10,607,270.36 72,640,514.30
03 .52
Notes of the list of assets impairment:
27. The assets of ownership or use right restricted
Item Closing amount Restricted reason
Subtotal of assets to guarantee 395,588,088.90
Inventory 264,604,094.91
Fixed assets 44,161,334.77
Intangible assets 86,822,659.22
Subtotal of assets of ownership or use right
1,586,203,376.19
restricted causing by other reasons
Other monetary funds 213,398,737.06 Margin deposit can not withdraw at any
time 不可随时支取的各类保证金存款
Notes receivable 1,372,804,639.13 Pledged in the bank as the note
Total 1,981,791,465.09 financing
28. Other non-current assets
Unit: RMB Yuan
Item Closing balance Opening balance
Notes of other non-current assets:
174
29. Short-term loan
(1) Category
Unit: RMB Yuan
Item Closing balance Opening balance
Pledge loan 55,000,000.00 55,000,000.00
Guarantee loan 1,354,157,491.35 1,701,468,525.61
Credit loan 3,702,539,133.65 3,482,601,238.87
Total 5,111,696,625.00 5,239,069,764.48
Notes of category of short-term loan:
① No. 2011 Chu-Zhong YDZ 003 Ceiling Value Mortgage Contract was resigned by the Company’s subsidiary Anhui
Electric Appliances and Bank of China Co., Ltd Chuzhou Branch on 13 Jan., 2011. The contract term was from 10
Jan., 2011 to 10 Jan., 2014. Ceiling principal balance of the contracted secure claims was RMB 55,000,000 and
the mortgage was CGY(2007) No. 00464 land use right, CGY(2008) No. 09579, CFQZ 2008 No. 00886 Building, FDQZCZ
No. 20100006538 Building, FDQZCZ No. 20100006539, and CFQZ 2008 No. 009579 Building. Until 30 Jun. 2014, the
book value of above mortgaged land use rights was RMB 5,420,149.46 (original value was RMB 6,353,848.80); book
value of mortgaged houses and buildings was RMB 44,161,334.77 (original value was RMB 51,696,497.26).
②Guarantee loan was the Company gaining short term loan by issuing letter of guarantee to the oversea subsidiary
through cooperative bank.
(2) Non-existent due outstanding short-term loans at the end of term
(2) Particulars of maturity unpaid short-term loan
Unit: RMB Yuan
Reason of failing Estimated repayment
The loan entity Amount Ratio The loan unit
to pay period
The repayment amount RMB after balance sheet date.
Note to short-tem loan, including extension of maturity short-term loan, explain the extending conditions and
new maturity date
30. Transaction financial liabilities
Unit: RMB Yuan
Item Closing fair value Opening fair value
Note:
31. Notes payable
Unit: RMB Yuan
Category Closing balance Opening balance
175
Commercial acceptance bill 50,103,060.64
Bank acceptance bill 622,013,184.02 515,034,730.20
Total 622,013,184.02 565,137,790.84
RMB 622,013,184.02 will be due in next fiscal period.
Notes of notes payable:
32. Accounts payable
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Within one year 2,685,121,623.93 3,261,181,383.46
One to two years 37,834,259.85 55,110,361.00
Two to three years 11,940,365.26 5,156,630.71
Three years or longer 25,097,921.23 20,355,768.95
Total 2,759,994,170.27 3,341,804,144.12
(2) Particulars about accounts payable due to shareholders holding 5% (including 5%) voting
rights of the Company
Unit: RMB Yuan
Name of entity Closing amount Opening amount
(3) There was no particular about loan due to shareholders holding 5% (including 5%) voting rights
of the Company
(4) Account payable due to related party, please refer to Note: VIII, 6 Account receivable/
payable of related party.
(5) Particular about significant accounts payable with aging over 1 year
Reason of failing Repay or not after
Name of creditors Amount
repayment balance sheet date
Installation project 22,034,270.49 Unsettled No
Outer walls project 11,104,610.78 Unsettled No
Survey and design expense 7,720,541.04 Unsettled No
Exterior components 4,453,592.44 Unsettled No
176
Reason of failing Repay or not after
Name of creditors Amount
repayment balance sheet date
Supervision and management expenses of
4,434,015.27 Unsettled No
projects
Total 49,747,030.02
(6) List of account payable including foreign currency balance
Closing amount Opening amount
Item Foreign currency Exchange Foreign currency Exchange
amount rate RMB amount rate RMB
USD 263,067,582.51 6.1528 1,618,602,221.67 153,111,034.12 6.0969 933,502,663.93
HKD 305,933,022.57 0.79375 242,834,336.66 213,412,725.69 0.7862 167,785,084.94
33 Advance from customers
(1) Advance from customers
Unit: RMB Yuan
Item Closing balance Opening balance
Within one year 344,602,973.75 458,960,747.24
One to two years 28,707,385.85 4,306,679.21
Two to three years 1,884,071.35 8,319,702.44
Over three years 17,061,805.81 11,128,906.79
Total 392,256,236.76 482,716,035.68
(2) Particulars about advance from customers due to shareholders holding 5% (including 5%)
voting rights of the Company
Unit: RMB Yuan
Item Closing amount Opening amount
(3) Particular about significant advance from customers with aging over 1 year
Particulars about advance from customers due to shareholders holding 5% (including 5%) voting
rights of the Company
The significant advance from customers with aging over 1 year is the sale amount
unsettled.
177
(4) List of advance from customers including foreign currency balance
Closing amount Opening amount
Item Foreign currency Exchange Foreign currency Exchange
amount rate RMB amount rate RMB
USD 5,443,935.92 6.1528 33,495,448.93 20,546,883.68 6.0969 125,272,295.11
HKD 139,313.57 0.79375 110,580.15 1,074,618.93 0.7862 844,865.40
EUR — — — — — —
34. Payroll payable
Unit: RMB Yuan
Item Opening book Increase Decrease Closing book
balance balance
I. Salary,
bonus,
315,245,828.12 675,592,141.71 761,856,886.16 228,981,083.67
allowance,
subsidy
II. Employee
1,387,563.03 35,708,482.69 31,474,598.70 5,621,447.02
welfare
III. Social
4,520,848.21 95,392,711.37 95,399,057.85 4,514,501.73
insurance
1.Medical
insurance 1,261,209.04 21,269,268.45 21,205,632.21 1,324,845.28
premiums
2. Basic
endowment 2,810,718.26 66,234,593.59 66,222,795.02 2,822,516.83
insurance
3. Pension
98,022.46 98,022.46
expense
4. Unemployment
196,583.42 3,753,180.29 3,814,229.13 135,534.58
insurance
5. Maternity
117,451.25 1,403,331.10 1,376,598.02 144,184.33
insurance
6. Insurance
against 134,886.24 2,634,315.48 2,681,781.01 87,420.71
injuries at work
IV. Public
1,591,150.93 15,232,602.95 15,451,817.13 1,371,936.75
reserve for
178
housing
construction
V. Welfare for
846,909.00 2,387,165.52 3,135,392.02 98,682.50
dismissing
VI. other 8,498,688.47 19,696,443.87 16,045,399.59 12,149,732.75
Total 332,090,987.76 844,009,548.11 923,363,151.45 252,737,384.42
RMB 0.00 is the amounts in arrears in the payroll payable.
The labor union budget and employee education budget is RMB 0.00, and the non-monetary benefits are RMB0.00,
as well as the compensation for terminating the labour contract is RMB 0.00.
The estimated distribution date and amount as well as other arrangements for payroll payable:
35. Taxes payable
Unit: RMB Yuan
Item Closing balance Opening balance
VAT -144,254,645.84 -142,717,407.04
Business tax -5,321,247.83 -2,190,048.93
Corporate income tax 17,036,207.19 6,244,782.78
Urban maintenance and construction tax 3,981,816.15 2,768,939.98
Educational Surtax 1,257,070.90 3,557,044.66
Flood control fund, fund for embankment, fund
for water conservancy and fund for river 874,353.32 2,160,526.97
management
Fund for disposing abandoned appliances and
3,086,238.18 2,353,064.80
electronic products
VAT 14,763,093.00 24,839,026.00
Land value increment tax -3,048,622.29 -2,052,242.92
Others 14,290,233.49 10,365,816.79
Total -97,335,503.73 -94,670,496.91
Note: Income tax belongs to subordinated subsidies of the Company was taxed by locating area, and the Company
made final accounts and clearance at the end of the year.
36. Interest payable
Unit: RMB Yuan
Item Closing balance Opening balance
Interest payable of short-term borrowings 30,171,536.26 34,945,870.48
Total 30,171,536.26 34,945,870.48
179
Notes:
37. Dividends payable
Unit: RMB Yuan
Reason for unsettlement over
Name of company Closing balance Opening balance
1 year
Total 0.00 --
Notes:
38. Other accounts payable
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 1,182,247,970.25 1,025,034,236.75
1-2 years 37,297,724.67 184,992,447.00
2-3 years 20,809,592.32 118,564,660.08
Over 3 years 34,379,761.45 62,804,787.14
Total 1,274,735,048.69 1,391,396,130.97
(2) Particulars about other accounts payable due to shareholders holding 5% (including 5%)
voting rights of the Company
Unit: RMB Yuan
Name of the entity Closing amount Opening amount
(3) The significant other accounts payable with aging over 1 year
(4) There was no particular about other accounts payable due to shareholders holding 5% (including
5%) voting rights of the Company
(5) Account payable due to related party, please refer to Note: VIII, 6 Account receivable/
payable of related party.
(6) Particular about significant other accounts payable with aging over 1 year
Whether returning
Reason for
Name of creditor Amount after the reporting
unsettlement
date or not
180
Zhenhua Group (Kunshan) Construction
No
Engineering Co., Ltd. 10,400,000.00 Guarantee money
Anhui Sijian Holding Group Co., Ltd. 3,045,000.00 Guarantee money No
Shanghai Shensy Logistics Co., Ltd. 2,600,000.00 Guarantee money No
Shanghai Yude International Logistics Co.,
Guarantee money No
Ltd. 2,500,000.00
Chuzhou Jinshida Automobile Transportation
Guarantee money No
Company 2,200,000.00
Xianyang Weiye Logistics Co., Ltd. 2,200,000.00 Guarantee money No
Shanghai Yongxin Color CRT Ltd. Co., Ltd. 2,075,485.15 Guarantee money No
Total 25,020,485.15
(7) Explanation about other accounts payable with large amount
Name of creditor Closing amount Nature or content
Zhenhua Group (Kunshan) Construction
Guarantee money
Engineering Co., Ltd. 10,400,000.00
Nantong Xinhua Construction Group Co.,
Guarantee money
Ltd. 5,000,000.00
Anhui Sijian Holding Group Co., Ltd. 3,045,000.00 Guarantee money
Shanghai Shensy Logistics Co., Ltd. 2,600,000.00 Guarantee money
Shanghai Yude International Logistics
Guarantee money
Co., Ltd. 2,500,000.00
Total 23,545,000.00
39. Estimated liabilities
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Welfare for
911,085.41 911,085.41
dismissing
Total 911,085.41 911,085.41
181
Notes:
40. Non-current liabilities due within 1 year
(1)
Unit: RMB Yuan
Item Closing amount Opening amount
1. Long-term loan due within 1 year
1,755,444.00 1,755,444.00
Total 1,755,444.00 1,755,444.00
(2) Long-term loan due within 1 year
Long-term loan due within 1 year
Unit: RMB Yuan
Item Closing amount Opening amount
RMB0.00 of long-term loan due within 1 year was of mature loan with extended term.
Top five long-term loans due within 1 year
Unit: RMB Yuan
Closing balance Opening balance
Starting Ending Foreign Foreign
Creditor Currency Rate (%) RMB RMB
date date currency currency
balance balance
balance balance
Mature loan of long-term loan due within 1 year
Unit: RMB Yuan
The annual Estimated
The loan Uses of loan Reason of
Amount Mature time interest rate repayment
entity amount failing repay
(%) period
RMB000 was paid back after Balance Sheet Date:
Notes of long-term borrowings due within 1 year:
(3) Bonds payable due within 1 year
Unit: RMB Yuan
Interest Interest
Name of Opening accrued paid in Closing
Face Issuing Bond Issuing Closing
the interest in the the interest
value date period amount balance
bonds payable reportin reportin payable
g period g period
Note
182
(4) Long-term payables due within one year
Unit: RMB Yuan
The loan Initial Interest rate Accrued Closing Conditions of
Time limit
entity amount (%) interest balance a loan
Note:
41. Other current liabilities
Unit: RMB Yuan
Item Closing book balance Opening book balance
Note:
42. Long-term borrowings
(1) Categories of long-term borrowings
Unit: RMB Yuan
Item Closing amount Opening amount
Pledge loan 19,900,000.00 5,000,000.00
Guarantee loan 298,410,836.38
Credit loan 7,800,000.00
Total 326,110,836.38 5,000,000.00
Notes:
As of 30 Jun. 2014, the above book value RMB 81,402,509.76(original value RMB 88,201,364.97)
and RMB 264,604,094.91 of the land use right was used for mortgaging the long term loan of RMB
19.9 million,
(2) The top five long-term loans
Unit: RMB Yuan
Closing balance Opening balance
Starting Ending Foreign Foreign
Creditor Currency Rate (%) RMB RMB
date date currency currency
amount amount
amount amount
Hong Kong
15 Jan, 15 Jan, 48,500,00 298,410,8
Construct USD
2014 2016 0.00 36.38
ion Bank
Kunshan
Rural 21 Jan. 21 Jan. 5,000,000
RMB 6.87%
Commercia 2014 2018 .00
l Bank
183
Kunshan
9 Jan. 11 Aug. 5,000,000
Branch of RMB 6.46%
2014 2016 .00
CCB
Kunshan
14 May 11 Aug. 5,000,000
Branch of RMB 6.46%
2014 2016 .00
CCB
Kunshan
6 Jun. 11 Aug. 5,000,000
Branch of RMB 6.46%
2014 2016 .00
CCB
318,410,8
Total -- -- -- -- -- --
36.38
Notes of long-term loan: for the long-term loans arising from mature loans with extended term, the Company shall
explain the conditions of extension, principal, interest, expected repayment arrangement:
43．Bonds payable
Unit: RMB Yuan
Interest Interest
Name of Opening accrued paid in Closing
Face Issuing Bond Issuing Closing
the interest in the the interest
value date period amount balance
bonds payable reportin reportin payable
g period g period
Note to bonds payable including convertible bonds convertible conditions and time.
44. Long-term accounts payable
(1) Category of long-term payable
Item Closing amount Opening amount
Chuzhou Tongchuang Jianshe Investment Co., Ltd. 30,000,000.00 30,000,000.00
Accrued financial lease outlay 2,563,670.00 3,441,392.00
Less: due within 1 year (Note: VII, 40) 1,755,444.00 1,755,444.00
Subtotal 30,808,226.00 31,685,948.00
Less: Unrecognized finance fees 223,652.41 319,417.87
Total 30,584,573.59 31,366,530.13
(2) Particulars about the top five long-term accounts payable
Unit: RMB Yuan
Entity Time limit The initial Ratio% Accrued Closing Conditions of
184
amount interest balance a loan
(3) Particulars about accrued financial lease in long-term account payable
Unit: RMB Yuan
Closing amount Opening amount
Entity
Closing amount Opening amount Closing amount Opening amount
International Far Eastern
— 2,563,670.00 — 3,441,392.00
Leasing Co., Ltd.
Total — 2,563,670.00 — 3,441,392.00
Guarantee amount provided by an independent third party financing lease
Note to long-term accounts payable
45. Special accounts payable
Unit: RMB Yuan
Increase in Decrease in
Opening the the Closing
Item Remark
amount reporting reporting amount
period period
Note
46. Other non-current liabilities
Unit: RMB Yuan
Item Closing book balance Opening book balance
Deferred income 135,387,720.22 131,658,369.11
Total 135,387,720.22 131,658,369.11
Note to other non-current liabilities
Particulars about deferred income involving government subsidy：
Unit: RMB Yuan
Amount of Amount of
newly non-operating Related to
Opening balan Other Closing am
Item increase income assets/ related
ce changes ount
subsidy recorded this to income
this year year
Industrializati 5,600,000. Related to
6,800,000.00
on project of 00 assets
185
large size
liquid crystal
display module
(LCM)
R&D and
industrializati
2,175,000. Related to
on of integrated 2,625,000.00
00 assets
module of flat TV
set
R&D and
industrializati 3,689,999. Related to
4,509,999.93
on of integrated 91 assets
DTMB
Fund for flat
panel display 7,499,999. Related to
8,499,999.98
industry in year 96 assets
2008
Key technology
and
industrializati 5,000,000. Related to
5,000,000.00
on of LED 00 assets
Backlight of
flat TV set
R&D of mating
core chip based 5,620,000. Related to
3,750,000.00
on the terminal 00 assets
of AVS/DRA
R&D and
industrializati
on of new-type 5,620,000. Related to
3,750,000.00
smart television 00 assets
with man-machine
interaction
R&D and
industrializati
on of new-type
2,350,000. Related to
terminal 2,650,000.00
00 assets
application
service system
of internet
Subsidies for 19,305,000 Related to
21,060,000.00
supporting .00 assets
186
equipment of
liquid crystal
module project
Funds for
scientific and
technological
3,000,000. Related to
innovation and 3,000,000.00
00 assets
special guidance
of achievements
transfer
Special Fund of
Strategic
Emerging
Industry
Development of 4,800,000. Related to
4,800,000.00
Dongguan 00 assets
Financial Bureau
(High-End New
Electronic
Information)
R&D and
industrializati
4,800,000. Related to
on of large size 6,000,000.00
00 assets
liquid crystal
display module
Infrastructure 11,550,000 Related to
11,550,000.00
subsidy .00 assets
Smart TV 7,000,000. Related to
0.00
industry chain 00 assets
Module complete
2,925,000. Related to
machine 0.00
00 assets
integration
34,074,863 Related to
Other 35,687,160.40
.27 assets
10,377,857 Related to
Other 11,976,208.80
.08 income
131,658,369.1 135,387,72
Total --
1 0.22
47. Share capital
Unit: RMB Yuan
187
Increase/Decrease (+/-)
Capitaliza
Opening Opening
Issuing new Bonus tion of
balance Other Subtotal balance
shares shares public
reserves
Total 1,203,972, 1,203,972,
shares 704.00 704.00
Notes of changes in share capital, for those action of increasing capital or decreasing capital in the reporting
period, the Company shall disclose the name of the accounting firm executing the capital verification and document
number of the capital verification report; for joint-stock companies running for less than three years, only
the net assets shall be specified for particulars before establishment; while for case of totally changing the
limited liability companies into joint-stock companies, capital verification on the establishment shall be
specified:
48. Treasury stock
Note
49. Special reserves
Note
50. Capital reserves
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Capital premium (share 1,211,366,082.5
1,211,366,082.55
capital premium) 5
Other capital reserves 63,039,860.23 21,115.80 63,060,976.03
1,274,427,058.5
Total 1,274,405,942.78 21,115.80
8
Note:
The increase of other capital reserves was due to the available for sale assets - fair value changes.
51. Surplus reserves
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Statutory surplus
593,846,200.71 593,846,200.71
reserves
188
Discretional surplus
254,062,265.57 254,062,265.57
reserves
Total 847,908,466.28 847,908,466.28
Notes of surplus reserves: for surplus reserves transferred to share capital, compensating losses and distributed
as dividends, relevant resolutions shall be explained:
The Company according to 10% of net profit withdraws surplus reserves in line with Company law, the provisions
of the Articles of Association, the accumulative amount of legal surplus reserves over 50% of the Company
registered capital can stop been withdrawn. The Company can withdraw discretional surplus reserves after
withdrawing legal surplus reserves. Been approved, discretional surplus reserves can be used for making up
previous annual loss and increasing share capital.
52. Provision for general risk
Notes of provision for general risk:
53. Retained profits
Unit: RMB Yuan
Extracting or
Item Amount
allocation proportion
Opening balance of retained profits
737,991,722.40 --
before adjustments
Opening balance of retained profits after
737,991,722.40 --
adjustments
Add: Net profit attributable to owners of
45,360,110.62 --
the Company
Dividend of common stock payable 12,039,727.04
Closing retained profits 771,312,105.98 --
Adjustment of undistributed profit details at the beginning of the year:
1) Affected undistributed profit at the beginning of the year was RMB 0.00 due to retroactive adjustment of
Accounting Standards for Business Enterprise and relevant regulations.
2) Affected undistributed profit at the beginning of the year was RMB 0.00 due to changes of accounting policies.
3) Affected undistributed profit at the beginning of the year was RMB 0.00 due to major accounting error
correction.
4) Affected undistributed profit at the beginning of the year was RMB 0.00 due to changes of merge range y the
same control.
5) Affected undistributed profit at the beginning of the year was RMB 0.00 of other adjustments.
Undistributed profits: for the first IPO companies, if the accumulated profits before IPO were shared by the
old and new shareholders decided by the Board of Directors, it should be specified. If the accumulated profits
189
before IPO were allocated and shared by old shareholders decided by the Board of Directors, the Company should
specify the audited profit values held by old shareholders in dividends payable.
(2) Note to profit distribution
Approved by the 2013 Annual General Meeting of Shareholders, as the basic of total
share of 1,203,972,704, the Company distributed cash bonus RMB 0.1(Tax included)
for every 10 shares to every shareholder. Total distribution of dividends was RMB
12039727.04, the remaining undistributed profits were carried forward to distribute
in the following years.
54. Revenue and Cost of Sales
(1) Revenue, Cost of Sales
Unit: RMB Yuan
Item Reporting period Same period of last year
Sales of main business 8,291,111,451.15 9,329,229,395.36
Other operating income 107,189,090.48 92,169,885.64
Cost of sales 7,010,567,842.76 7,835,777,505.69
(2) Main business (Classified by industry)
Unit: RMB Yuan
Reporting period Same period of last year
Industry
Revenue of sales Costs of sales Revenue of sales Costs of sales
Electronic industry 8,291,111,451.15 6,955,006,042.75 9,329,229,395.36 7,783,071,113.88
Total 8,291,111,451.15 6,955,006,042.75 9,329,229,395.36 7,783,071,113.88
(3) Main business (Classified by product)
Unit: RMB Yuan
Reporting period Same period of last year
Product
Revenue of sales Costs of sales Revenue of sales Costs of sales
Color TV business 6,177,727,430.58 5,085,270,590.27 7,478,282,465.06 6,178,528,941.50
Mobile phone business 772,672,737.46 711,453,764.98 686,575,916.65 618,861,444.21
Consumer appliances
790,777,396.77 635,004,533.66 785,194,995.56 665,864,686.59
business
Others 549,933,886.34 523,277,153.84 379,176,018.09 319,816,041.58
190
Total 8,291,111,451.15 6,955,006,042.75 9,329,229,395.36 7,783,071,113.88
(4) Main business (Classified by area)
Unit: RMB Yuan
Reporting period Same period of last year
Area
Revenue of sales Costs of sales Revenue of sales Costs of sales
Domestic sales 5,926,481,822.65 4,776,277,966.87 7,782,919,179.42 6,314,646,566.63
Overseas sales 2,364,629,628.50 2,178,728,075.88 1,546,310,215.94 1,468,424,547.25
Total 8,291,111,451.15 6,955,006,042.75 9,329,229,395.36 7,783,071,113.88
(5) The revenue of sales from the top five customers
Unit: RMB Yuan
Customer Main business revenue Proportion of total business revenue (%)
Total of the top five
1,807,073,728.48 21.52%
customers
Total 1,807,073,728.48 21.52%
Note:
55. The revenue of contract project
Unit: RMB Yuan
The cumulative
Fixed price The cumulative gross margin Settlement
Contract item Amount
contract cost occurred recognized amount
( loss with“-”)
The cumulative
Cost plus The cumulative gross margin Settlement
Contract item Amount
contract cost occurred recognized amount
( loss with“-”)
Note:
56. Business tax and surcharges
Unit: RMB Yuan
Same period of last Calculation and payment
Item Reporting period
year standard
Business tax 4,042,401.68 1,475,839.91
Urban maintenance and 13,399,122.34 18,018,626.18
191
construction tax
Education surtax 6,041,419.73 8,371,564.25
Local education surtax 3,738,583.41 4,902,454.38
Other 192,204.40 265,679.78
Total 27,413,731.56 33,034,164.50 --
Notes:
For calculation and payment standard of business tax and surcharges please refer to note V, tax.
57. Selling expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Wages 151,749,324.64 162,510,473.38
Expenses for promotion activities 359,141,687.30 364,417,645.15
Expenses for logistics 141,945,921.72 159,743,609.13
Advertising expense 171,880,170.75 159,060,890.75
Maintenance charges 142,074,650.38 154,895,890.42
Travel charge 23,423,793.92 23,810,439.27
Social security charges 20,712,564.48 34,261,911.29
Housing fund 969,589.86 910,837.48
Rental charges 22,047,847.15 19,872,418.40
Entertainment expense 17,250,259.42 20,508,329.56
Employees welfare cost 12,633,750.82 13,033,537.39
Taxes fees and fund 34,938,990.00 40,450,564.00
Other 57,099,810.41 57,926,543.58
Total 1,155,868,360.85 1,211,403,089.80
58. Administration expense
Unit: RMB Yuan
Item Reporting period Same period of last year
R & D expenses 104,169,480.26 101,602,125.00
Payroll 72,840,329.19 73,218,938.17
Depreciation expense 19,008,083.68 16,897,047.83
Taxes and fund 12,860,882.54 13,694,092.19
192
Entertainment expense 10,104,937.16 11,341,531.79
Consulting fees 3,781,502.23 4,990,559.53
Travel charge 6,680,915.98 6,794,316.49
Social security charges 8,807,907.28 9,129,792.51
Labor union expenditure 5,643,131.66 5,258,947.85
Water and electricity charges 3,338,089.72 4,090,061.80
Patent fee 3,613,461.56 3,713,744.62
Employees welfare cost 7,614,581.68
Other 45,979,139.44 62,204,950.74
Total 304,442,442.38 312,936,108.52
59. Financial expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Interest expense 79,441,547.99 107,675,645.05
Less: Interest income 38,095,548.80 25,539,623.72
Less: Capitalization of interest
356,256.69 2,744,842.52
amount
Gains or losses on exchange 58,538,407.94 -104,264,106.93
Less: Capitalization of gains or
2,332,626.81 3,165,589.83
losses on interest amount
Other 101,860,777.24 -21,707,338.29
60. Income from change of fair value
Unit: RMB Yuan
Source of income from change of fair value Reporting period Same period of last year
Note:
61. Income from investment
(1) Particulars about income from investment
Unit: RMB Yuan
Item Reporting period Same period of last year
Long-term equity investment income
1,720,001.40 -8,197,695.92
accounted by equity method
193
Investment income arising from disposal of
262,454,090.34
long-term equity investments
Investment income received from holding of
48,104.52 21,115.80
held-to-maturity investments
Investment income received from
2,217,922.37
available-for-sale financial assets
Other 266,440,118.63 -8,176,580.12
(2) Long-term equity investment income accounted by equity method
Unit: RMB Yuan
Same period of
Name of investee Reporting period Reason for increase/decrease
last year
(3) Long-term equity investment income accounted by equity method
Unit: RMB Yuan
Same period of
Name of investee Reporting period Reason for increase/decrease
last year
Shenzhen Refond Optoelectronics
3,712,566.58 5,063,615.84
Co., Ltd.
Enray Tek Optoelectronic
182,936.71 -13,261,186.76
(Shanghai) Co., Ltd.
Shanghai Konka Green Science and
-2,175,501.89
Technology Co., Ltd.
Chongqing Jingkang Plastic
-125.00
Products Co., Ltd.
Total 1,720,001.40 -8,197,695.92 --
Notes of investment income: make notes if there is significant limitation for recovery of investment income.
If there isn’t the said limitation, notes too:
62. Impairment losses
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Bad debts losses -2,061,447.86 12,043,363.71
II. Inventory falling price losses 37,500,606.06 10,868,440.16
VII. Impairment losses of fixed assets 164,794.58
Total 35,603,952.78 22,911,803.87
194
63. Non-operating income
(1)
Unit: RMB Yuan
The amount included in
Same period of last the current
Item Reporting period
year non-recurring gains
and losses
Total gains from disposal of
160,385.54 12,182,289.25 160,385.54
non-current assets
Including：Gains from disposal of
160,385.54 12,182,289.25 160,385.54
fixed assets
Government grants 51,628,675.32 31,471,202.07 18,563,326.67
Income from penalty 2,620,502.92 1,535,922.81 2,620,502.92
Other 3,805,904.24 765,399.89 3,805,904.24
Total 58,215,468.02 45,954,814.02 25,150,119.37
Note:
(2) Details about government grants recorded into current profit or loss:
Unit: RMB Yuan
Whether belong to
Same period of last Related to assets/
Item Reporting period non-recurring
year
related to income profit and loss
R&D subsidy 3,692,856.61 2,731,240.32 Yes
Special funds for
transformation and
upgrade of 1,320,000.00 Yes
provincial industry
in 2010
Industrialization
of large-size
liquid crystal 1,200,000.00 1,200,000.00 Yes
display module
(LCM)
R&D and
industrialization
of large-size 1,200,000.00 1,200,000.00 Yes
liquid crystal
display module
R&D and 820,000.02 820,000.02 Yes
195
industrialization
of integrated DTMB
Fund for flat panel
display industry in 1,000,000.02 500,000.01 Yes
year 2008
Special funds of
enterprise 1,902,900.00 Yes
development
Subsidy for LCD
module project 1,755,000.00 Yes
equipment matching
Software drawback 33,065,348.65 4,730,137.72 Yes
Finance discount 5,000,000.00 Yes
The L/C export
820,722.00 Yes
subsidy
Special fund of
Shenzhen brand 1,000,000.00 Yes
cultivation
Industrialization
of new generation of
intelligent 1,800,000.00 Yes
multimedia mobile
phone
Land supporting
1,755,000.00 Yes
fund
Other 2,199,748.02 13,386,924.00 Yes
Total 51,628,675.32 31,471,202.07 -- --
64. Non-operating expenses
Unit: RMB Yuan
The amount recorded
Same period of last in the current
Item Reporting period
year non-recurring gains
and losses
Total losses from disposal of non-current
3,468,914.31 3,868,800.73 3,468,914.31
assets
Including：losses from disposal of fixed
3,468,914.31 3,868,800.73 3,468,914.31
assets
External donation expenses 118,001.24 118,001.24
196
Penalty expenses 68,973.65 159,482.03 68,973.65
Other 380,051.82 1,097,569.87 380,051.82
Total 4,035,941.02 5,125,852.63 4,035,941.02
Note
65 Income tax expense
Unit: RMB Yuan
Item Reporting period Same period of last year
Income tax of the current year calculated according
37,260,940.35 3,800,578.66
to the tax law and relevant regulations
Adjustment of deferred income tax -1,424,214.41 19,247,343.52
Total 35,836,725.94 23,047,922.18
66. Basic earnings per share and diluted earnings per share
For the Company, the basic earnings per share shall be calculated by dividing the current net
profits belonging to the shareholders of ordinary shares by the weighted average number of
ordinary shares issued to the public. In accordance with the specific terms and clauses of the
issuance contract, the number of newly issued ordinary shares shall be calculated and decided
as of the date of receivable consideration (generally the date of issuance of stocks).
Based on net profit attributable to ordinary shareholders of the Company of the current year,
numerators of diluted earnings per share shall be determined after adjusting the following
factors: (1) Interests of diluted potential ordinary shares recognized as expenses at the current
year; (2) Incomes or expenses arising from the transfer of diluted potential ordinary shares;
and (3) Income tax influence related to the aforesaid adjustment.
Denominators of diluted earnings per share equal to the sum of the following two items: (1)
The weighted average number of ordinary shares issued by the parent company in basic earning
per share; and (2) The weighted average number of ordinary shares which are newly added due
to the transfer of the assumed diluted potential ordinary shares to ordinary shares.
When calculating the weighted average number of increased ordinary shares resulted from that
the diluted potential ordinary shares convert into ordinary shares already issued, the diluted
potential ordinary shares issued in prior periods shall be supposed to be converted at the
beginning of the current year. The diluted potential ordinary shares issued in the current year
shall be supposed to be converted on the date of issuance.
(1) Basic earnings per share and diluted earnings per share of each period
Reporting period Same period of last year
Profits of the reporting
Basic earning Diluted earnings per Basic earning per Diluted earnings per
period
per share share share share
Net profit attributable
to shareholder of
0.0377 0.0377 0.0337 0.0337
ordinary shares of the
Company
197
Net profit attributable
to shareholders of
ordinary shares of the
-0.1428 -0.1428 0.0115 0.0115
Company after deducting
non-recurring gains and
losses
(2) Process of calculating basic earnings per share and diluted earnings per share
In the reporting period, the Company did not hold diluted potential common shares, so diluted
earnings per share equaled to basic earnings per share.
① When basic earnings per share are being calculated, the net profits attributable to
shareholders of ordinary shares are:
Item Reporting period Same period of last year
Net profits attributable to shareholders of
ordinary shares of the current year 45,360,110.62 40,547,673.62
Of which: net profits attributable to sustainable
operation 45,360,110.62 40,547,673.62
Net profits attributable to terminated operation — —
Net profits attributable to shareholders of
ordinary shares of the Company after deducting
non-recurring profits and losses -171,913,337.99 13,903,675.19
Of which: net profits attributable to sustainable
operation -171,913,337.99 13,903,675.19
Net profits attributable to terminated operation — —
②While basic earnings per share are being calculated, the denominator is the average weighted
number of ordinary shares issued publicly, and the calculation is as the following:
Item Reporting period Same period of last year
Ordinary shares publicly issued at the beginning of
1,203,972,704.00 1,203,972,704.00
2014
Add: Weighted average number of ordinary shares
— —
issued in 2014
Less: Weighted average number of ordinary share
— —
repurchased in 2014
Weighted average number publicly issued at the end
1,203,972,704.00 1,203,972,704.00
of 2014
67. Other comprehensive income
Unit: RMB Yuan
198
Item Reporting period Last period
1. Profits/(losses) from available-for-sale
28,154.40 -31,673.70
financial assets
Less: Effects on income tax generating from
7,038.60 -7,918.43
available-for-sale financial assets
Subtotal 21,115.80 -23,755.27
4. Converted amount of foreign currency financial
2,237,339.56 2,903,844.68
statements
Subtotal 2,237,339.56 2,903,844.68
Total 2,258,455.36 2,880,089.41
Note:
68. Notes of Cash Flow Statement
(1) Other cash received relevant to operating activities
Unit: RMB Yuan
Item Amount
Income from government subsidy 31,908,463.07
Bargain money and deposit 27,554,760.14
Interest income from bank deposits 14,135,184.41
Income from waste 8,071,360.46
Repayment of individual borrowing 5,802,642.86
Insurance claims 4,333,841.05
Temporary received repair fund 509,158.87
Other and current accounts 75,915,536.30
Total 168,230,947.16
Notes:
(2) Other cash paid relevant to operating activities
Unit: RMB Yuan
Item Amount
Expense for cash payment 459,673,582.63
Payment for pledges, guarantee and repair 17,680,792.70
Employee reserve fund 17,293,013.87
Advanced payment 4,023,198.50
199
Expense for bank handling charges 25,208,406.51
Donation expense 118,001.24
Other expense 44,114,121.21
Total 568,111,116.66
Note:
(3) Other cash received relevant to investment activities
Unit: RMB Yuan
Item Amount
Short-term financial deposit products, etc 200,000,000.00
Total 200,000,000.00
Note:
(4) Other cash paid relevant to investment activities
Unit: RMB Yuan
Item Amount
Short-term financial deposit products, etc 600,000,000.00
Other 3,365,645.37
Total 603,365,645.37
Note:
(5) Other cash received relevant to financing activities
Unit: RMB Yuan
Item Amount
Receipt and return of pledged RMB fixed deposits upon maturity 236,460.60
Total 236,460.60
Note:
(6) Other cash paid relevant to financing activities
Unit: RMB Yuan
Item Amount
Receipt and return of pledged RMB fixed deposits upon maturity 176,578,387.43
Other 1,492,773.58
Total 178,071,161.01
200
Note:
69. Supplemental information for Cash Flow Statement
(1) Supplemental information for Cash Flow Statement
Unit: RMB Yuan
Supplemental information Reporting period Last period
1. Reconciliation of net profit to net cash flows
-- --
generated from operations：
Net profit 47,326,353.75 36,648,406.00
Add: Provision for assets impairments 35,603,952.78 22,911,803.87
Depreciation of fixed assets, oil-gas assets and
68,425,826.82 67,001,921.02
productive biological assets
Amortization of intangible assets 6,033,144.06 4,975,346.55
Amortization of long-term deferred expense 1,927,894.23 1,392,781.58
Losses/gains on disposal of property,
intangible asset and other long-term assets 583,210.94 -12,182,289.25
(gains: negative)
Loss on retirement of fixed assets (gains:
2,725,317.83 3,868,800.73
negative)
Losses/gains from variation of fair value
0.00
(gains: negative)
Financial cost (income: negative) 101,976,435.69 79,391,178.80
Investment loss (gains: negative) -266,440,118.63 8,176,580.12
Decrease in deferred tax assets (increase:
-1,417,175.81 19,247,343.52
negative)
Increase in deferred tax liabilities (decrease:
0.00 0.00
negative)
Decrease in inventory (increase: negative) 295,038,981.79 483,369,713.85
Decrease in accounts receivable from operating
1,224,444,298.44 1,102,292,669.90
activities (increase: negative)
Increase in accounts payable from operating
-308,300,040.77 454,595,963.74
activities (decrease: negative)
The net cash flow from operating activities 1,207,928,081.12 2,271,690,220.43
2. Significant investing and financing
activities without involvement of cash receipts -- --
and payments
201
3. Change of cash and cash equivalent: -- --
Closing balance of Cash 1,632,051,673.72 1,769,306,476.23
Less: opening balance of cash 1,771,489,421.21 824,043,169.37
Net increase of cash and cash equivalent -139,437,747.49 945,263,306.86
(2) Relevant information of acquisition or disposal of subsidiaries and other operation
entities in the reporting period
Unit: RMB Yuan
Supplemental information Reporting period Same period of last year
I. Relevant information on acquisition of
-- --
subsidiaries and other operation entities:
II. Relevant information on disposal of
-- --
subsidiaries and other operation entities
1. Price of disposal of subsidiaries and other
265,803,752.51
operation entities
2. Cash and cash equivalents received for
disposal of subsidiaries and other operation 247,687,800.00
entities
Less: Cash and cash equivalents held by the
13,905,448.02
subsidiary and other operating entities
4．Net assets of disposal of subsidiary 899,358.99
Current assets 76,412,504.99
Non-current assets 141,501,505.44
Current liabilities 215,814,651.44
Non-current liabilities 1,200,000.00
(3) Constitution of cash and cash equivalents
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Cash 1,632,051,673.72 1,771,489,421.21
Including: Cash on hand 31,099.17 18,884.53
Bank deposit on demand 1,632,020,574.55 1,771,470,536.68
III. Balance of cash and cash equivalent at
1,632,051,673.72 1,771,489,421.21
period-end
Note:
202
70. Notes to statement of changes in owners’ equity
Notes on the items under “Other” for adjusting the opening balance and the relevant adjusted amounts as well
as retrospective adjustment arising from business combination under the same control, etc.:
VIII. Accounting treatment of assets securitization
1. Main trade arrangements, accounting treatment and bankruptcy isolation terms of assets
securitization
2. Particulars of main part with special purpose of the Company has no actual control right
but actual take the risk
Unit: RMB Yuan
Operating
Net profit in
Closing total Closing total Closing net revenue in
Name the reporting Remark
assets liabilities assets the reporting
period
period
IX. Related Parties and Related-party Transactions
1. Information of the parent company of the Company
The
The The
ultimat
parent parent
e
Registe Legal Busines Registe company company Organiz
Parent Relatio Busines control
red Represe s red 's 's ation
company nship s Type ling
place ntative nature Capital shareho voting Code
party
lding right
of the
(%) (%)
Company
Tourism
, real
OCT Parent State-o estate
Duan
Enterpr company wned Shenzhe and 6300000 1903461
Xiannia 20.00% 20.00% SASAC
ises of the holding n electro 000 7-5
n
Co. Company s nic
industr
y
Note:
203
2. Information of subsidiaries of the Company
Percenta
Percenta
Legal Register ge of Organiza
Full Business Register Business ge of
Type represen ed voting tion
name type ed place nature Sharehol
tative capital right code
ding (%)
(%)
Shenzhen
Konka
Telecomm Shenzhen
Manufact
unicatio Limited , LI RMB12,00 70848057
uring 100.00% 100.00%
ns company Guangdon HONGTAO 0.00 -2
industry
Technolo g
gy Co.,
Ltd.
Shenzhen
Konka
Precisio Controll Shenzhen
Manufact
n Mould ing Limited , LOU RMB4,000 61881661
uring 46.31% 52.49%
Manufact subsidia company Guangdon YILIANG .00 -8
industry
uring ry g
Co.,
Ltd.
Shenzhen Sales of
Controll Shenzhen
Konka HUANG electron
ing Limited , RMB830.0 61881678
Electron ZHONGTIA ic 51.00% 51.00%
subsidia company Guangdon 0 -1
ic Co., N applianc
ry g
Ltd. e
Shenzhen
Konka
Shenzhen
Informat Manufact
Limited , LIN RMB3,000 73416472
ion uring 100.00% 100.00%
company Guangdon GAIKE .00 -5
Network industry
g
Co.,
Ltd.
Shenzhen
Konka Shenzhen
Manufact
Plastic Limited , SUN RMB950.0 61881662
uring 100.00% 100.00%
Products company Guangdon WENBO 0 -6
industry
Co., g
Ltd.
Shenzhen Limited Shenzhen HUANG Manufact RMB4,200 100.00% 100.00% 70841244
204
Konka company , ZHONGTIA uring .00 -9
Life Guangdon N industry
Electron g
ic Co.,
Ltd.
Shenzhen
Konka
Electron Shenzhen
Investme
ic Limited , NIU RMB6,500 79389213
nt 100.00% 100.00%
Fittings company Guangdon WEIDONG .00 2
holding
Technolo g
gy Co.,
Ltd.
Mudanjia
ng
Controll Mudanjia
Arctic Manufact
ing Limited ng, CHUAI RMB6,000 60610286
Ocean uring 60.00% 60.00%
subsidia company Huilongj RONGWEI .00 1
Applianc industry
ry iang
es Co.,
Ltd.
Shanxi
Controll
Konka Xianyang Manufact
ing Limited SU RMB6,950 62310230
Electron , uring 60.00% 60.00%
subsidia company ZENGMENG .00 2
ic Co., Shaanxi industry
ry
Ltd.
Chongqin
g Konka
Controll
Eurotomo Manufact
ing Limited Chongqin RMB3,000 78155925
tive ZENG HUI uring 57.00% 57.00%
subsidia company g .00 2
Electron industry
ry
ic Co.,
Ltd.
Chongqin
g Controll
Manufact
Qingjia ing Limited Chongqin WANG RMB1,500 62192187
uring 40.00% 40.00%
Electron subsidia company g XIAOYONG .00 3
industry
ic Co., ry
Ltd.
Anhui Controll
Manufact
Konka ing Limited Chuzhou, GONG RMB14,00 61056872
uring 78.00% 78.00%
Electron subsidia company Anhui ZHIPING 0.00 -8
industry
ic Co., ry
205
Ltd.
Anhui
Controll
Konka Manufact
ing Limited Chuzhou, RMB7,819 74890634
Applianc Lv Jian uring 96.46% 97.45%
subsidia company Anhui .00 7
e Co., industry
ry
Ltd.
Changshu
Konka
Electron
Controll
ic Co., Changshu Manufact
ing Limited WANG RMB2,465 62822347
Ltd. , uring 60.00% 60.00%
subsidia company YOULAI .00 X
Konka Jiangsu industry
ry
Electron
ic Co.,
Ltd.
Kunshan
Konka HUANG Manufact
Limited Kunshan, RMB35,00 68053275
Electron ZHONGTIA uring 100.00% 100.00%
company Jiangsu 0.00 -5
ic Co., N industry
Ltd.
Dongguan
Dongguan
Konka HUANG Manufact
Limited , RMB26,66 61811698
Electron ZHONGTIA uring 100.00% 100.00%
company Guangdon 7.00 -8
ic Co., N industry
g
Ltd.
Dongguan
Konka Dongguan
Manufact
Packing Limited , LI RMB1,000 72245604
uring 100.00% 100.00%
Material company Guangdon YUNFEI .00 -2
industry
s Co., g
Ltd.
Dongguan
Konka Controll Dongguan
Manufact
Mould ing Limited , LOU RMB1,000 75109846
uring 59.73% 59.73%
Plastic subsidia company Guangdon YILIANG .00 -7
industry
Co., ry g
Ltd.
Boluo Controll
Boluo， Manufact
Konka ing Limited LIN RMB4,000 72112128
Guangdon uring 51.00% 51.00%
PCB Co., subsidia company GAIKE .00 -3
g industry
Ltd. ry
Boluo Limited Boluo, LIN Manufact RMB1,500 100.00% 100.00% 79931620
206
Konka company Guangdon GAIKE uring .00 -8
Precisio g industry
n
Technolo
gy Co.,
Ltd.
Konka
Private Research
(Nanhai) Foshan,
non-ente LIN and 68243005
Developm Guangdon RMB50.00 100.00% 100.00%
rprise GAIKE developm 8
ent g
units ent
Center
Hong
Kong Hong HUANG Internat
Limited
Konka Kong， ZHONGTIA ional HKD50.00 100.00% 100.00% —
company
Co., China N trade
Ltd.
Konka
Househol
d
Applianc
Hong Investme
es Limited NIU
Kong, nt HKD50.00 100.00% 100.00% —
Investme company WEIDONG
China holding
nt &
Developm
ent Co.,
Ltd.
Konka
Househol
d
Applianc
Hong Internat
es Limited NIU
Kong, ional HKD50.00 100.00% 100.00% —
Internat company WEIDONG
China trade
ional
Trading
Co.,
Ltd.
KONKA Internat
Limited CHANG USD100.0
AMERICA, The USA ional 100.00% 100.00% —
company DONG 0
INC. trade
Konka Frankfur Internat
Limited CHANG
(Europe) t, ional EUR2.50 100.00% 100.00% —
company DONG
Co., Germany, trade
207
Ltd. Europe
Dongguan
Xutongda Controll
Dongguan Manufact
Mould ing Limited RMB500.0 69649113
Guangdon Xu Hao uring 46.31% 52.49%
Plastic subsidia company 0 -4
g industry
Co., ry
Ltd.
Shenzhen
Konka
Reserach
Optoelec Shenzhen
Limited and RMB1,000 55719393
tronic guangdon LI GAIKE 100.00% 100.00%
company developm .00 8
Technolo g
ent
gy Co.,
Ltd.
Shenzhen
Wankaida
Science Shenzhen Software
Limited RMB1,000 55718505
and Guangdon LI GAIKE developm 100.00% 100.00%
company .00 7
Technolo g ent
gy Co.,
Ltd.
Kunshan
Kangshen
g
Investme Limited Kunshan SUN Property RMB35,00 55806907
100.00% 100.00%
nt company Jiangsu WENBO industry 0.00 -4
Developm
ent Co.,
Ltd.
Anhui
Konka
Tongchua
ng Manufact
Limited Chuzhou Xu RMB18,00 55922811
Househol uring 75.00% 100.00%
company Anhui Gansen 0.00 0
d industry
Applianc
es Co.,
Ltd.
Indonesi Controll
Internat
a Konka ing Limited Indonesi CHANG USD150.0
ional 51.00% 51.00% —
Electron subsidia company a DONG 0
trade
ics Co., ry
208
Ltd.
Shenzhen
Shushida
Logistic Shenzhen
Limited NIU Logistic RMB1,000 58791087
s Guangdon 100.00% 100.00%
company WEIDONG s .00 0
Service g
Co.,
Ltd.
Beijing Sales of
Konka househol
Limited CHEN RMB3,000 59067865
Electron Beijing d 100.00% 100.00%
company YUEHUA .00 4
ic Co., applianc
Ltd. e
Kunshan
Jielunte Controll
Manufact
Mould ing Limited Kunshan LOU RMB10,00 57672944
uring 46.31% 52.49%
Plastic subsidia company Jiangsu YILIANG 0.00 3
industry
Co. , ry
Ltd.
Wuhan
Jielunte Controll
Manufact
Mould ing Limited WuhanHub LOU RMB3,000 06680713
uring 46.31% 52.49%
Plastic subsidia company ei YILIANG .00 -0
industry
Co. , ry
Ltd.
Chuzhou
Jielunte Controll
Manufact
Mould ing Limited Chuzhou LOU RMB2,000 06247828
uring 46.31% 52.49%
Plastic subsidia company Anhui YILIANG .00 -8
industry
Co. , ry
Ltd.
3. Information of joint ventures and associated enterprise
Percenta
Percenta
Register Legal Register ge of Organiza
Name of Business Business ge of Relation
ed represen ed voting tion
investee type nature sharehol ship
address tative capital rights code
ding (%)
(%)
I. Joint venture
II. Associated enterprise
209
Shenzhen
Manufact
Refond
uring RMB216,7
Optoelec Limited Gong Joint 71526660
Shenzhen and 05,093.0 18.90% 18.90%
tronics company Weibin venture 3
selling 0
Co.,
LEDs
Ltd.
Enray
Tek Manufact
Optoelec uring
Limited Zhang USD50,00 Joint 56013355
tronic Shanghai and 33.16% 33.16%
company Rujing 0,000.00 venture 7
(Shangha selling
i) Co., LEDs
Ltd.
New
Shenzhen
energy
Konka Under
products
Energy Limited Dong RMB20,00 same 71520435
Shenzhen for 30.00% 30.00%
Technolo company Yaping 0,000.00 controll 7
mobile
gy Co., er
equipmen
Ltd.
t
Shanghai
Konka
Manufact
Green
uring RMB520,0
Science Limited Joint 05933302
Shanghai Hu Wen and 00,000.0 39.00% 39.00%
and company venture -9
selling 0
Technolo
LEDs
gy Co.,
Ltd.
Shenzhen
Qianhai
Qingson
g
Venture
Investm
ent Business RMB333,3
Partners Joint 30606317
Fund Shenzhen investme 30,000.0 6.00% 6.00%
hip venture -8
Managem nt etc. 0
ent
Corpora
tion
(Limite
d
partner
210
ship)
4. Information of other related parties of the Company
Name of other related party Relationship with the Company Organization code
Shenzhen OCT East Co., Ltd. Under the same actual controller 75252879-9
Shanghai OCT Investment
Under the same actual controller 78589775-0
Development Co., Ltd.
Chengdu Tianfu OCT Industrial
Under the same actual controller 78012858-1
Development Co., Ltd.
Beijing Century OCT Industrial Co.,
Under the same actual controller 74005033-7
Ltd.
Taizhou OCT Co., Ltd. Under the same actual controller 79457788-X
Shanghai Tianxiang OCT Investment
Under the same actual controller 74805502-8
Co., Ltd.
Anhui Huali Packaging Co., Ltd. Under the same actual controller 76276957X
Shenzhen OCT Water and Power Co.,
Under the same actual controller 19217869-7
Ltd
Shanghai Huali Packaging Co., Ltd Under the same actual controller 60737971-5
Shenzhen Huayou Packaging Co., Ltd Under the same actual controller 76198355-8
Shenzhen Huali Packing & Trading
Under the same actual controller 61881654-6
Co., Ltd
Huali Packaging (Huizhou)Co.,Ltd. Under the same actual controller 68061271-2
Huizhou Huali Packaging Co., Ltd. Under the same actual controller 79932011-9
Shenzhen Overseas Chinese Town Gas
Under the same actual controller 70849783-3
Station Co., Ltd.
Chongqing Machinery & Electronics
Shareholder of subsidiary 45041726-8
Holding (Group) Co., Ltd
Dongyangyi Industry Co., Ltd Shareholder of subsidiary —
Wuhan OCT Industry Development Co.,
Under the same actual controller 69531802-2
Ltd.
Shenzhen Konka Video &
Communication Systems Engineering Under the same actual controller 72858645-4
Co., Ltd.
Note：
211
5. Related-party transactions
(1) Purchase of goods and acceptance of service
Unit: RMB Yuan
Transaction Reporting period Same period of last year
pricing
Related Transaction
principle and Propor Propor
party content Amount tion Amount tion
decision
(%) (%)
procedure
Anhui Huali
Purchase Negotiated
Packaging Co., 15,262,384.20 0.32% 19,481,890.89 0.34%
materials price
Ltd.
Shanghai HuaLi
Purchase Negotiated
packing Co., 5,822,678.56 0.10% 5,022,236.58 0.09%
materials price
Ltd.
Huali Packaging
Purchase Negotiated
(Huizhou)Co.,Lt 7,173,404.45 0.12% 4,892,321.12 0.09%
materials price
d.
Shenzhen OCT
Negotiated
Water and Power Water and Power 3,321,585.10 0.07% 4,497,926.08 0.08%
price
Co., Ltd
Purchase Negotiated
OCT Hotel Group 164,714.48 0.01% 77,082.20 0.01%
materials price
Shenzhen Refond
Purchase Negotiated
Optoelectronics 51,323,181.02 0.95% 55,194,380.11 0.98%
materials price
Co., Ltd.
Transactions of selling commodities and providing labor services
Unit: RMB Yuan
Transaction Reporting period Same period of last year
pricing
Related Transaction
principle and Propor Propor
party content Amount tion Amount tion
decision
(%) (%)
procedure
Pricing
Shenzhen OCT
Selling LCDs through 371,794.87 0.80% 210,000.00 0.80%
East Co., Ltd
negotiation
Chengdu Tianfu
Pricing
OCT Industrial
Selling LCDs through 380,000.00 1.45%
Development
negotiation
Co., Ltd
212
Shanghai
Pricing
Tianxiang OCT
Selling LCDs through 10,683.76 0.02%
Investment Co.,
negotiation
Ltd.
Yunnan OCT Pricing
Industry Co., Selling LCDs through 12,820.51 0.02%
Ltd. negotiation
Shanghai Konka
Pricing
Green Lighting
Sale of material through 11,087,208.54 23.85%
Technology Co.,
negotiation
Ltd.
Shenzhen Refond Pricing
Optoelectronics Sale of material through 7,538,825.26 12.51% 12,498,597.92 41.41%
Co., Ltd. negotiation
(2) Related trusteeship/contract
Unit: RMB Yuan
Income
Name of the Name of the
Pricing recognized in
entruster/co entrustee/ Type Initial date Due date
basis the reporting
ntractee contractor
period
Particulars about entrust/contractee
Unit: RMB Yuan
Charge
Name of the Name of the
Pricing recognized in
entruster/co entrustee/ Type Initial date Due date
basis the reporting
ntractee contractor
period
Note
(3) Information of related-party lease
Related-party lease of the Company
Unit: RMB Yuan
Rental Rental income
Category of Pricing basis
Name of Name of situation of recognized in
the leased Ending date for the
lessor lessee the Company the reporting
assets rental income
Initial date period
Related-party Lessee of the Company
213
Unit: RMB Yuan
Rental Rental charge
Category of Pricing basis
Name of Name of situation of recognized in
the leased Ending date for the
lessor lessee the Company the reporting
assets rental income
Initial date period
Note
(4) Information of related-party guarantee
Unit: RMB Yuan
Whether the
Guarantee guarantee was
Guarantor Secured party Initial date Due date
amount accomplished or
not
Shenzhen Konka
Dongguan Konka
Precision Mould
Mould Plastic 1,000.00 24 Feb. 2014 24 Aug. 2014 No
Manufacturing
Co., Ltd.
Co., Ltd.
Shenzhen Konka Kunshan
Precision Mould Jielunte Mould
780.00 21 Jan. 2014 21 Jan. 2019 No
Manufacturing Plastic Co. ,
Co., Ltd. Ltd.
Anhui Konka
Tongchuang Anhui Konka
Household Appliance Co., 5,500.00 18 Sep. 2014 18 Sep. 2016 No
Appliances Co., Ltd.
Ltd.
Konka
Konka Group Co., Telecommunicati
80,000.00 1 Dec. 2013 1 De. 2014 No
Ltd. ons Technology
Co., Ltd.
Konka Group Co., Hong Kong Konka
5,000.00 13 Apr. 2013 13 Apr. 2015 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
1,500.00 22 Apr. 2013 22 Apr. 2015 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
5,580.00 19 Jul. 2013 19 Jul. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
6,140.50 19 Jul. 2013 19 Jul. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
1,000.00 23 Jul. 2013 23 Jul. 2014 No
Ltd. Co., Ltd.
214
Konka Group Co., Hong Kong Konka
2,000.00 25 Jul. 2013 25 Jul. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
30,000.00 26 Oct. 2013 26 Oct. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
7,500.00 27 Nov. 2013 27 Nov. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
5,000.00 14 Feb. 2014x 14 Feb. 2016 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
6,131.00 17 Mar. 2014 17 Mar. 2015 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
302.00 27 Nov. 2013 27 Nov. 2014 No
Ltd. Co., Ltd.
Konka Group Co., Hong Kong Konka
6,300.00 30 Jun. 2014 30 Jun. 2015 No
Ltd. Co., Ltd.
Konka Household
Appliances
Konka Group Co.,
International 4,570.00 27 Nov. 2013 27 Nov. 2014 No
Ltd.
Trading Co.,
Ltd.
Konka Household
Appliances
Konka Group Co.,
International 2,905.88 6 Mar. 2014 6 Mar. 2015 No
Ltd.
Trading Co.,
Ltd.
Konka Household
Appliances
Konka Group Co.,
International 3,000.00 27 May 2014 26 Nov. 2014 No
Ltd.
Trading Co.,
Ltd.
Note
(5) Inter-bank lending of capital of related parties：
Unit: RMB Yuan
Amount borrowed and
Related party Initial date Due date Explanation
loaned
Borrowed
loaned
(6) Related party asset transfer and debt restructuring
Unit: RMB Yuan
215
Reporting period Same period of last year
Related pricing
Type Content Propor Propor
party principle Amount tion Amount tion
(%) (%)
(7) Other related-party transactions
6. Receivables and payables of related parties
Receivables and payables of related parties of listed Company
Unit: RMB Yuan
Closing period Opening period
Item Related party Bad debt Bad debt
Book balance Book balance
provision provision
Shanghai Konka Green
Joint -stock
Lighting Technology 5,449,283.73 108,985.67 5,537,935.26 110,758.71
company
Co.,Ltd.
Under the same
Yunnan Oct Industrial
actual 38,500.00 770.00
Co., Ltd
controller
Shanghai Tianxiang Under the same
OCT Investment Co., actual 585,136.00 11,702.72
Ltd. controller
Shanghai OCT Under the same
Investment actual 743,700.00 14,874.00
Development Co., Ltd. controller
Under the same
Shenzhen the Windows
actual 2,821,500.00 56,430.00
of the world Co., Ltd
controller
Under the same
Tianjin OCT Industry
actual 3,024,000.00 60,480.00
Co., Ltd.
controller
Chengdu Tianfu OCT Under the same
Industrial actual 512.40 256.20
Development Co., Ltd. controller
Under the same
Shenzhen OCT Hotel
actual 69,500.00 3,475.00
Co., Ltd.
controller
Shenzhen Splendid Under the same
76,500.00 76,500.00
China Development actual
216
Co., Ltd controller
Under the same
Shenzhen OCT East
actual 83,000.00 16,600.00
Interlaken Hotel
controller
Under the same
Shenzhen OCT East
actual 385,260.00 192,630.00
Co., Ltd
controller
Shenzhen OCT East Joint -stock
6,282,496.64 125,649.93
Co., Ltd company
Shenzhen Konka Video
Under the same
& Communication 153,384,966.1
actual 306,769.93
Systems Engineering 3
controller
Co., Ltd.
Under the same
Shenzhen Oct Gas
actual 80,000.00 80,000.00 80,000.00 80,000.00
Station Co., Ltd.
controller
Under the same
Shenzhen OCT Real
actual 1,209,064.86 1,128,337.25 1,209,064.86 1,128,337.25
Estate Co., Ltd.
controller
Under the same
Shenzhen Oct Property
actual 77,402.65 77,402.65 77,402.65 77,402.65
Management Co., Ltd.
controller
Under the same
Shenzhen OCT Water
actual 1,640,550.61 43,239.55 1,069,029.14 213.81
and Power Co., Ltd.
controller
Account payable of listed Company
Unit: RMB Yuan
Item Related party Closing amount Opening amount
Anhui Huali Packaging Co., Under the same actual
10,641,071.05 9,240,802.15
Ltd. controller
Huali Packaging (Huizhou) Co., Under the same actual
1,488,179.76 1,491,833.53
Ltd. controller
Shenzhen Refond
Joint -stock company 1,312,238.21 84,065.78
Optoelectronics Co., Ltd.
Shanghai Huali Packing Co., Under the same actual
3,645,219.90 1,753,863.52
Ltd. controller
Shenzhen Huali Packing and Under the same actual
13,957.02
Trading Co., Ltd. controller
Shenzhen Dekon Electronics Joint -stock company 358,929.03 356,545.32
217
Co.,Ltd.
X. Stock payment
1. The Stock payment overall situation
Unit: RMB Yuan
Note
2. The Stock payment settled by equity
Unit: RMB Yuan
Note
3. The Stock payment settled by cash
Unit: RMB Yuan
Note
4. The Stock payment service
Unit: RMB Yuan
5. Modification and termination of the stock payment
IX. Contingency
1. Contingent liabilities and its financial effect arising from unsettled litigation or
arbitration
1. Contingent liabilities and financial effects caused by pending litigation or arbitration
On 4 Feb. 2013, the Company’s subsidiary Kunshan Konka signed Purchase Order (Hereinafter
referred to as "PO") with Italy customer MOTOM ELECTRONICS GROUP SPA (Hereinafter referred to
as the "MEG"). Then the Kunshan Konka entrusted Ningbo United International Freight Forwarding
Co., Ltd. (Hereinafter referred to as the “Ningbo United”) to book space, and Ningbo United
signed and issued the carrier's bill of lading of Econolines Ltd. (Hereinafter referred to as
the “Econolines”) on 5, 14 and 19 May 2013. According to the verification, after the goods
arrived to the port of destination in Italy, the empty cargo container had returned to the
shipping company, but the full set of original bill of lading was still in Kunshan Konka; Ningbo
United and Econolines ‘s behavious of delivery of goods without original bill of lading had
violated the "maritime law" and other relevant laws and regulations, which caused large loss
218
to Kunshan Konka, the payment in arrears of MEG to Kunshan Konka was USD 1,099,423.52
Kunshan Konka filed a suit from Shanghai Maritime Court, requested Ningbo United and Econolines
compensate for the loss of payment for goods USD 1,099,423.52 and its interest; meanwhile,
applied for being granted to property preservation of Ningbo United.
In May 2014, Shanghai Maritime Court made the first-instance judgment, which ordered Ningbo
United and Econolines compensate for the loss of payment for goods USD 1,099,423.52 and its
interest, Ningbo United appealed to the Shanghai Higher People's Court against its sentence.
Now the case waits for a second trial.
2. Other contingent liabilities and the effects on financial affairs
As of 30 Jun. 2016 there was no significant contingent to disclose.
2. Contingent liabilities and its financial effect arising from loan guarantee offered to other
companies
Other contingent liabilities and the effects on financial affairs
XII. Commitments
1. Significant commitments
(1) Commitments on capital
Unit: RMB Yuan
Item Closing amount Opening amount
Large contract awarding contract 316,111,419.06 99,377,084.00
Total 316,111,419.06 99,377,084.00
(2) Commitments on operation lease
Up to the date of Balance Sheet, details about irrevocable contract of operation lease that
the Group signed with foreign companies are as follows:
Unit: RMB Yuan
Item Closing amount Opening amount
The lowest payment of irrecoverable operation
lease:
The first year after the balance sheet date 16,570,549.33 14,847,302.73
The second year after the balance sheet date 12,504,595.37 10,295,864.04
The third year after the balance sheet date 11,723,172.40 9,344,862.38
219
The following years 5,070,903.29 8,757,379.65
Total 45,869,220.39 43,245,408.80
2. Fulfillment of previous commitments
Up to 30 Jun. 2014, the Company didn’t have other commitments that need to be disclosed.
XIII. Events after balance sheet date
1. Other significant events after balance sheet date
Unit: RMB Yuan
Influence on the
Inestimable influence
Item Content financial position and
reasons
operating results
2. Profit distribution after balance sheet date
Unit: RMB Yuan
3. Notes of other significant events
Notes of other significant events
At the beginning of 2014, The Ministry of Finance released the No. CK [2014]6
Accounting Standards for Business Enterprises No.39- Fair Value Measurements, No.
CK[2014]7 Accounting Standards for Business Enterprises No.30- Presentation of
Financial Statements (revised in 2014), No. CK[2014]8 Accounting Standards for
Business Enterprises No.9- Employee Compensation (revised in 2014), No. CK[2014]10
Accounting Standards for Business Enterprises No.33- Consolidated Financial
Statement (revised in 2014) and No. CK[2014]11 Accounting Standards for Business
Enterprises No.40- Joint Venture Arrangement. All requirements would be implemented
from 1 Jul, 2014 for all enterprises executing Accounting Standards for Business
Enterprises. All overseas listed enterprises are encouraged to implement it in
advance.
Since 1 Jul, 2014, the Company would start to implement the above standards and revise
all accounting policies according to the above standards. Modified clauses related
to accounting policies and predicated effects on financial condition and business
performance include:
220
(1) Accounting Standards for Business Enterprises No.9- Employee Compensation
(revised in 2014) standardize the accounting treatment of welfare after departure.
The welfare plan after departure is defined as contribution plans and benefit plans.
Defined contribution plans regulate that enterprises would not assume further
payment obligations after deposited fixed expenses for independent fund. Defined
benefit plans regulates the welfare plans besides defined contribution plans after
departure. During the accounting period that enterprises provide services to
employees, the amount payable for defined contribution plans should be calculated
in to current profits and losses or relevant asset costs. For the defined benefit
plans, enterprises should make the actuarial assumption by expected accumulative
total welfare unit method. The obligations in defined benefit plans and welfare
obligations in the formula of defined benefit plans during working period should
be calculated into current profits and losses, net liabilities of recalculated
defined benefit plans or other comprehensive income for the changes of net assets.
Moreover, the revised standards enrich the short-term payroll accounting treatment
specifications, accounting treatment specifications about demission welfare,
introduce other long-term employee benefits and complete the accounting treatment
of employee compensation. No signification impacts would occur for the enterprise
financial statements.
(2) Accounting Standards for Business Enterprises No.30- Presentation of Financial
Statements (revised in 2014) further standardize the presentation of financial
statements, revise and amend the contents of going concern evaluation, normal period
of operation cycle and notes. The profit statement supplementary materials divided
by nature of expense are regarded as mandatory disclosure. The Standards require
presentation of other comprehensive income in the profit statement. The
comprehensive income items are divided into: 1. Items that would not be divided again
into profits and losses; 2. Under specified conditions, items could be divided again
into profits and losses. The Company would modify the presentation of financial
statement according to the revised standards.
(3) According to Accounting Standards for Business Enterprises No.33- Consolidated
Financial Statement (revised in 2014), the consolidation scope of consolidated
financial statements should be determined on the basis of control. The Standards
establish the single model to judge whether the control exists and regulate the three
elements required for controlling of invested parties, including: 1. Authority of
invested parties; 2. Variable returns in the events related to invested parties;
3. Abilities of using the rights from invested parties to affect the return amounts.
On this basis, the Standards provide more guidance to the original ones. According
to the regulation, the Company management possesses the control power for major
judgments of the invested units.
(4) Accounting Standards for Business Enterprises No.40- Joint Venture Arrangement
standardize the recognition, classification and business accounting for two or more
221
participants. Joint venture arrangement would be divided into joint operation and
joint ventures according to different rights and obligations. Joint operation refers
that the joint parties would enjoy the joint arrangements of related assets and
liabilities. Joint ventures refer that the joint parties would only enjoy the joint
arrangements of net assets. In the Standards, joint parties should adopt the equity
method for investment and determine the assets (including amounts of jointly owned
assets), liabilities (including amounts of joint liabilities), income (including
amounts from selling the joint shares) and other expenses (including amounts of joint
operation). No signification impacts could occur for the financial statements of
the Company.
(5) Accounting Standards for Business Enterprises No.39- Fair Value Measurements
standardize the definition of fair value, measurement methods and three levels of
fair value measurement according to the input value and make detailed requirements
for the disclosure. However, the Standards could not modify the application of fair
value measurements in different occasions. The Company management considers that
the Standards would result in modification of related policies and procedures about
fair value measurements and disclose more fair value information in financial
statements. Besides, no significant impacts could occur for the determination and
measurements of items in financial statements.
2. Note to the profit distribution after balance sheet date
th th
The Company held 55 Meeting of the 7 Session of the Board of Directors on 21 May
2014, the meeting reviewed and approved the preplan of 2013 Annual Profits
Distribution which was: As the basis of the total shares capital of 1,203,972,704
shares, distribute RMB 0.1 for every 10 shares to every shareholder; the preplan
will be implemented after the review and approval of the board of directors.
XIV. Other significant events
1. Exchange of non-monetary assets
2. Debt restructuring
3. Business combination
Business combination in the reporting period, please referred to Note VI, Business combination and consolidated
financial statement
4. Lease
Lease
222
(1) The closing original price accumulated depreciation and accumulated impairment provision
of all kinds of the rented fixed assets.
Particulars of the financing lease of the rented fixed assets, please refer to note VII, 17
(2) Minimum lease payment will be paid in future
The remaining lease term The minimum lease payment
Within 1 year (including 1 year) 1,755,444.00
Within 1 year and 2 years (including 2 years) 584,573.59
Total 2,340,017.59
(3) The balance of unrecognized financing charges, and the method used to allocate
the unrecognized financing charges.
As of the balance sheet date, the balance of unrecognized financing charges was RMB223,
652.41; amortization method is the actual interest rate method.
Category of fixed assets leased by operating lease, please refer to note VII, 17
5. Financial instruments issued outstanding and can be converted into shares
6. Assets and liabilities measured by fair value
Unit: RMB Yuan
Changes of
gains and Accumulative Withdrawn
losses of fair changes of fair impairment in
Item Opening amount Closing amount
value in the value included reporting
reporting in equity period
period
Financial assets
3.Available-for-sal
941,999.30 28,154.40 28,154.40 970,153.70
e financial assets
Subtotal of
941,999.30 28,154.40 28,154.40 970,153.70
financial assets
Investment property 0.00 0.00
Productive
0.00 0.00
biological asset
Total 941,999.30 970,153.70
223
Financial
0.00 0.00
liabilities
7. Foreign financial assets and financial liability
Unit: RMB Yuan
Changes of
gains and Accumulative Withdrawn
losses of fair changes of fair impairment in
Item Opening amount Closing amount
value in the value included reporting
reporting in equity period
period
Financial assets
3. Loan and accounts
652,171,458.64 -1,467,219.80 687,356,575.81
receivable
Subtotal of 1,297,854,975.
989,382,571.29
financial assets 47
Financial 1,101,287,748. 1,861,436,558.
liabilities 87 33
8. Main content and major changes of pension plan
9. Other
(1) The Company’s subsidiaries Mudanjiang Konka, Changshu Konka and Chongqing
Electronic were under liquidation.
(2) On 22 May 2014, the 57th Meeting of the 7th Board of Directors reviewed and approved
the Proposal of Transferring All Share Equity of Video & Communication Company. The
details were as followed: the meeting decided to transfer 100% equity of Shenzhen
Konka Video & Communication Systems Engineering Co., Ltd. held by the Konka Group
to OCT Group Company. The share equity transfer was performed on 23 Jun. 2014. After
the transfer, the Company had no control to the company, thus, since 1 Jun. 2014,
Shenzhen Konka Video & Communication Systems Engineering Co., Ltd. has no longer
included into consolidation scope.
(3) Urban updating projects of Konka headquarter plant
According to the application proposed by the Company, Shenzhen Nanshan
Reconstruction Office of Urban Village (old village) published the Notice about the
Subject of Implementation of Urban Updating Projects of Shenzhen Nanshan Konka Group
Headquarter Plant in November, 2012 for the publicity of the subject of
implementation of urban updating projects of Konka Group headquarter plant.
224
In August, 2013, Overseas Chinese Town Group submitted the Comment Letter of Opposing
Konka Group to be the Only Subject of: Implementation of the Urban Updating Projects
of Konka Headquarter Plant” for application to stop the formalities of Konka Group
headquarter plant and handle it after appropriate discussion between Overseas
Chinese Town Group and the Company. According to the Comment Letter, the Shenzhen
Nanshan Reconstruction Office of Urban Village (old village) released the Comment
Letter of Konka Group to be the Subject of Implementation of Urban Updating Projects
of Konka Headquarter Plant in August, 2013 to coordinate the rights and interests
of all Parties and make suggestions to the Comment Letter.
Hereafter, no agreement of Konka Group to be the only subject of implementation of
the urban updating projects has been reached after several negotiations.
In order to resolve the differences and promote the implementation of urban updating
rd th
projects of Konka headquarter plant, according to the 53 meeting of the 7 Board
of Directors, the Company decided to submit the dispute of Konka Group to be the
only subject of implementation of the urban updating projects to Shenzhen Court of
International Arbitration. In order to promote the implementation of urban updating
th
projects of Konka headquarter plant, according to the resolution of 54 meeting of
th
the 7 Board of Directors, Konka Group shall pay the land funds for the projects
in advance before the arbitration result. If the arbitral agency identifies the
Company as the only development subject, the Company should continue implementing
the project. If the arbitral agent asserts that the Company could not be the only
development subject, the development plan should be discussed and agreed by the
Company and OCT Group to handle the transfer formalities of the land and share the
paid prices on land.
On 10 Mar., 2014, the Company has applied to Shenzhen Court of International
Arbitration for arbitration of the subject of implementation of urban updating
project of Konka headquarter plant to regard Overseas Chinese Town Group as the
respondent and the Company as the only subject of implementation to develop the urban
updating project of Shenzhen Nanshan Konka Group headquarter plant.
During 16 April, 2014 to 17 June, 2014, four court sessions were held by Shenzhen
Court of International Arbitration. Overseas Chinese Group and the Company submitted
the request for arbitration, evidence materials, written pleas and defending
opinions.
On 31 July, 2014, the Company received the consent award from Shenzhen Court of
International Arbitration (No. HNGZC [2014] D97) with decisions:
(1) Rejecting the request of Konka Group to be the only subject of implementation
of Urban Updating Projects of Shenzhen Nanshan Konka Group Headquarter Plant.
225
(2) Rejecting the request about counsel fees from Konka Group.
(3) Rejecting the counterclaim about counsel fees from Overseas Chinese Town Group.
(4) The arbitration fee of this case is 490,926.54 Yuan, totally assuming by Overseas
Chinese Town Group. The repaid 29,050 Yuan by Overseas Chinese Town Group could be
included in the arbitration fees paid by Overseas Chinese Town Group.
(5) The case with a counterclaim arbitration fee of RMB 29050, shall be borne fully
by the OCT Group. OCT Group prepaid RMB 29050 as the arbitration fee that OCT Group
shall bear.
(4) The Company ’ s subsidiary, Shenzhen Konka Information Network Co., Ltd
(hereinafter referred to as “Information Network”) and Shenzhen Champion Maxiumic
Group Co., Ltd (hereinafter referred to as “Champion Company”) signed Memorandum
of Understanding of Two-Way Set-Top-Box and supplementary agreements, Purchase
Contract of Remote Control and Procurement Framework Contract of Set-Top-Box on 5
April, 2012, 1 June, 2012 and 3 July, 2012 respectively. It is contracted that
Information Network would purchase the set-top-box and remote control from Champion
Company with load of RMB 5,822,250.00, including RMB 5,565,000.00 for set-top-box
and RMB 257,250.00 for remote control.
After several ineffective requirements for payment, Information Network brought the
lawsuit in Shenzhen Nanshan People’s Court in November, 2013. It is to request
Champion Company to pay the loan of RMB 5,565,000.00, interests of RMB 336,186.99
and to undertake the liabilities for breach of the contract. Information Network
could not bring the lawsuit of Procurement Contract of Remote Control because these
disputes have been arbitrated. At the same day, it submitted the application for
property preservation to seize the accounts of Champion Company.
On 11 Mar., 2014, Shenzhen Nanshan People ’ s Court opened the session to for
conciliation between Information Network and Champion Company. The conciliation
statement issued by the Court regulated that Champion Company should pay the load
of RMB 5,822,250.00 for the set-top box and remote control to Information Network;
thereinto 10% should be paid to Information Network before 31 Mar., 2014 and the
rest and liquidated damages of RMB 6,020,025.00 should be paid before 31 May, 2014.
After the conciliation statement had come into effect. Champion Company did not
perform in accordance with the provisions of the conciliation statement. On 1 Jun.
2014, Information Network applied for enforcement in Shenzhen Nanshan People’s Court.
At present, the case was still in the process of enforcement. On 25 Jul. 2014
Information Network received RMB 1 million payments of good from Beijing Champion
Maxiumic Group Co., Ltd for Shenzhen Champion Maxiumic Group Co., Ltd.
(5) On 4 Nov. 2013, the Company and its subsidiary Shenzhen Konka Telecommunications
Technology Co., Ltd. signed Credit Limit Agreement No. 2013ZZYEXZ0001005, which
agree that the Company and Shenzhen Konka Telecommunications Technology Co., Ltd.
gained general credit limit no more than RMB 5,300,000,000 by mortgaging bank
226
acceptance no more than RMB 1,300,000,000, of which the Company performed as
accreditor and Shenzhen Konka Telecommunications Technology Co., Ltd. as personnel
with drawn right. Period of credit: 4 Nov. 2013 to 4 Nov. 2014.
(6) On 11 Jun. 2014, the Company signed Credit Contract No. J2014Z241JTB with CCB
Shenzhen Sub-branch and gained general credit limit no more than RMB 5,000,000,000.
Period of credit: 11 Jun. 2014 to 2016.
(7) 21 Oct. 2013, the Company and its subsidiary Shenzhen Konka Telecommunications
Technology Co., Ltd. signed Credit Contract No. 2013 SDZZEZ015 with China Minsheng
Banking Co., Ltd. Shenzhen Sub- branch and gained general credit limit no more than
RMB 500,000,000, of which the Company performed as accreditor and Shenzhen Konka
Telecommunications Technology Co., Ltd. as personnel with drawn right. Period of
credit: 21 Oct. 2013 to 21 Oct. 2014.
(8) As of 30 Jun. 2014, the Company opened L/G balance USD 145,000,000.00 and RMB
619,535,000.00 to its subsidiary Hong Kong Konka through credit bank and L/G balance
USD 30,000,000.00 and RMB 74,758,750.00 to its subsidiary Konka Household Appliances
International Trading.
XV. Notes of main items in the financial statements of the Company
1. Accounts receivable
(1) Accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Provision for bad Provision for bad
Book balance Balance
debts debts
Pro
Category Prop Prop Prop
por
orti orti orti
Amount tio Amount Amount Amount
on on on
n
(%) (%) (%)
(%)
Accounts receivable
with significant
single amount and 153,384,96 10. 0.20
306,769.93
individually 6.13 17% %
withdrawn bad debt
provision
Accounts receivable for which bad debt provisions are made on the group basis
227
1,274,189, 84. 208,756,272. 16.3 1,726,375, 98.2 213,570,680. 12.3
Aging group
723.20 52% 42 8% 307.32 8% 61 7%
The company related 80,064,862 5.3 0.00 30,245,849 1.72
0.00
party group .61 1% % .96 %
1,354,254, 89. 208,756,272. 15.4 1,756,621, 100. 213,570,680. 12.1
Subtotal of the group
585.81 83% 42 1% 157.28 00% 61 6%
1,507,639, 209,063,042. 1,756,621, 213,570,680.
Total -- -- -- --
551.94 35 157.28 61
Notes to category of accounts receivable:
Accounts receivable with significant single amount and individually withdrawn bad debt provision at period-end
√Applicable □Inapplicable
Unit: RMB Yuan
Bad debt Withdrawal Withdrawal
Content Book balance
provision proportion %) reason
Shenzhen Konka Video &
Communication Systems 153,384,966.13 306,769.93 0.20%
Engineering Co., Ltd.
Total 153,384,966.13 306,769.93 -- --
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√Applicable □Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging Prop Prop
Bad debt Bad debt
orti orti
Amount provision Amount provision
on on
(%) (%)
Within 1 year
Of which： -- -- -- -- -- --
Within 1 80.0 87.0
1,020,250,128.05 20,405,002.56 1,503,542,564.48 30,070,851.29
year 7% 9%
Subtotal
80.0 87.0
of within 1,020,250,128.05 20,405,002.56 1,503,542,564.48 30,070,851.29
7% 9%
1 year
1-2 years 4.19 1.73
53,327,749.84 2,666,387.49 29,928,642.40 1,496,432.12
% %
2-3 years 1.04 0.65
13,309,197.24 2,661,839.45 11,179,817.35 2,235,963.47
% %
228
3-4 years 0.44 0.14
5,587,558.20 2,793,779.10 2,357,290.44 1,178,645.22
% %
4-5 years 0.23 0.09
2,971,652.10 1,485,826.05 1,556,408.29 778,204.15
% %
Over 5 14.0 178,743,437.7 10.3
178,743,437.77 177,810,584.36 177,810,584.36
years 3% 7 0%
Total 208,756,272.4
1,274,189,723.20 -- 1,726,375,307.32 -- 213,570,680.61
2
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□Applicable √Inapplicable
In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
√Applicable □Inapplicable
Accounts receivable with significant single amount and individually withdrawn bad debt provision at period-end
□Applicable √Inapplicable
(2) Information of accounts receivable reversed or recovered in the report period
Unit: RMB Yuan
Withdrawal amount
Basis on
Reason for of bad debt
Content of accounts recognition of Reversed or
reversal or provision before
receivable provision for bad recovered amount
recovery the reversal or
debts
recovery
The withdrawal of bad debt provision of accounts receivable with significant single amount or insignificant
single amount but individually made impairment test at the end of report period:
Unit: RMB Yuan
Content of accounts Withdrawal
Book balance Amount of bad debts Reason
receivable proportion (%)
Notes to accounts receivable with insignificant single amount but large risks of groups after grouping by credit
risks characteristics:
(3) Particulars of the actual verification of accounts receivable during the reporting period
Unit: RMB Yuan
Whether
occurred
Name of the
Nature Time Amount Reason because of
entity
related party
transactions
Note：
(4) Particulars of accounts receivable due from the shareholders of the Company who held over
229
5% (including 5%) shares with voting rights during the reporting period
Unit: RMB Yuan
Closing amount Opening amount
Name of entity Amount of bad Amount of bad debt
Book balance Book balance
debt provision provision
(5) Nature or content of large amounts of other receivables
(6) Top five accounts receivable
Unit: RMB Yuan
Relationship with
Name of the entity Amount Term Proportion (%)
the Company
Customer 1 Customer 205,836,110.07 Within 1 year 13.65%
Customer 2 Customer 202,655,599.12 Within 1 year 13.44%
The same actual
Customer 3 153,384,966.13 Within 1 year 10.17%
controller
Subsidiary of the
Customer 4 80,064,862.61 Within 1 year 5.31%
Company
Customer 5 Customer 54,412,751.12 Within 1 year 3.61%
Total -- 696,354,289.05 -- 46.18%
(7) Accounts receivable due from related parties
Unit: RMB Yuan
Relationship with the
Name of the entity Amount Proportion (%)
Company
Hong Kong Konka Co.,
The Company’ subsidiary 80,064,862.61 5.31%
Ltd.
Shenzhen Konka Video &
Communication Systems The same actual controller 153,384,966.13 10.17%
Engineering Co., Ltd.
Total -- 233,449,828.74 15.48%
(8)
Transfer amount of account receivable not confirm to recognition was RMB 0.00
230
(9) The asset securitization use accounts receivable as standard shall briefly explain related
arrangements
(10) Lists of accounts receivable of foreign currency, and discount rate
Closing amount Opening amount
Item Exchange Exchange
Foreign currency rate RMB amount Foreign currency rate RMB amount
USD 18,760,365.61 6.1528 115,428,777.53 13,872,319.74 6.0969 84,578,146.22
HKD 123,972.09 0.79375 98,402.85 914,592.71 0.7862 719,052.79
AUD 49,764.00 5.8064 288,949.69 49,764.00 5.4301 270,223.50
2. Other accounts receivable
(1) Other accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Provision for bad Provision for bad
Book balance Book balance
debts debts
Category
Pro Pro Pro Pro
por por por por
Amount tio Amount tio Amount tio Amount tio
n n n n
(%) (%) (%) (%)
Other accounts
receivable with
100 100
significant single 2.2 13,391,926.0 13,363,045.1 1.9 13,363,045
13,391,926.08 .00 .00
amount and 2% 8 1 1% .11
% %
individually withdrawn
bad debt provision
Other accounts receivable for which bad debt provisions are made on the group basis
195,671,468.3 32. 22,070,684.2 11. 174,127,894. 24. 18,303,959 10.
Aging group
6 43% 0 28% 50 88% .09 51%
The company related 394,352,724.6 65. 512,473,249. 73.
party group 8 35% 36 21%
590,024,193.0 97. 22,070,684.2 3.7 686,601,143. 98. 18,303,959 2.6
Subtotal of the group
4 78% 0 4% 86 09% .09 7%
231
603,416,119.1 35,462,610.2 699,964,188. 31,667,004
Total -- -- -- --
2 8 97 .20
Notes:
Other accounts receivable with significant single amount and individually withdrawn bad debt
provision at period-end:
√Applicable □Inapplicable
Unit: RMB Yuan
Withdrawal Reason for
Content Book balance Bad debt provision
proportion (%) withdrawal
Chongqing Stopping production
13,391,926.08 13,391,926.08 100.00%
Electronic and under deficit
Total 13,391,926.08 13,391,926.08 -- --
In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt
provision:
√Applicable □Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging Prop Prop
Provision for Provision for bad
orti orti
Amount bad debts Amount debts
on on
(%) (%)
Within 1 year
Of which： -- -- -- -- -- --
Within 1 35.5 65.3
69,567,330.49 1,391,346.61 113,714,606.77 2,274,292.13
year 5% 1%
Subtotal of
35.5 65.3
within 1 69,567,330.49 1,391,346.61 113,714,606.77 2,274,292.13
5% 1%
year
1-2 years 53.8 24.5
105,342,764.16 5,267,138.21 42,699,523.20 2,134,976.16
4% 2%
2-3 years 2.52 1.81
4,926,986.28 985,397.26 3,146,162.80 629,232.56
% %
3-4 years 0.73 0.84
1,435,337.90 717,668.95 1,466,512.94 733,256.47
% %
4-5 years 0.71 0.65
1,379,832.70 689,916.35 1,137,774.05 568,887.03
% %
Over 5 years 13,019,216.83 6.65 13,019,216.83 11,963,314.74 6.87 11,963,314.74
232
% %
Total 195,671,468.36 -- 22,070,684.20 174,127,894.50 -- 18,303,959.09
In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt provision:
□Applicable √Inapplicable
In the groups, other accounts receivable adopting other methods to withdraw bad debt provision:
√Applicable □Inapplicable
Other accounts receivable with significant single amount and individually withdrawn bad debt provision at
period-end:
□Applicable √Inapplicable
(2) Information of accounts receivable reversed or recovered in the report period
Unit: RMB Yuan
Withdrawal amount
Basis on
Reason for of bad debt
Content of accounts recognition of Reversed or
reversal or provision before
receivable provision for bad recovered amount
recovery the reversal or
debts
recovery
The withdrawal of bad debt provision of accounts receivable with significant single amount or insignificant
single amount but individually made impairment test at the end of report period:
Unit: RMB Yuan
Content of accounts Withdrawal
Book balance Amount of bad debts Reason
receivable proportion (%)
Notes to other accounts receivable with insignificant single amount but large risks of groups after grouping
by credit risks characteristics:
(3) Particulars of the actual verification o f other accounts receivable during the reporting
period
Unit: RMB Yuan
Whether occurred
Name of the
Nature Time Amount Reason because of related
entity
party transactions
Note:
(4) Particulars of other accounts receivable due from the shareholders of the Company who held
over 5% (including 5%) shares with voting rights during the reporting period
Unit: RMB Yuan
Closing amount Opening amount
Name of entity Amount of bad debt Amount of bad
Book balance Book balance
provision debt provision
233
(5) Nature or content of large amounts of other account receivables
(6) Top five other accounts receivable
Unit: RMB Yuan
Relationship with
Name of the entity Amount Term Proportion (%)
the Company
Dongguan Konka
Subsidiary of the
Electronic Co., Within 1 year
Company
Ltd. 152,681,149.31 25.30%
Shenzhen Konka
Subsidiary of the
Information Network Within 1 year
Company
Co., Ltd. 104,132,903.14 17.26%
Boluo Konka
Precision Subsidiary of the
Within 1 year
Technology Co., Company
Ltd. 92,623,783.98 15.35%
Chongqing Konka
Eurotomotive
Within 1 year
Electronic Co., Shareholder of the
Ltd. subsidiary 42,495,725.46 7.04%
Non- related
Within 1 year
Other party 62,894,650.00 10.42%
Total 454,828,211.89 75.38%
(7) Other accounts receivable from related parties
Unit: RMB Yuan
Relationship with Percentage in total other
Name of entity Amount
the Company account receivables (%)
Subsidiary of the
Dongguan Konka Company 152,681,149.31 25.30%
Subsidiary of the
Information Network
Company 104,132,903.14 17.26%
Subsidiary of the
Boluo Precision
Company 92,623,783.98 15.35%
Subsidiary of the
Boluo Konka Company 22,058,530.15 3.66%
Subsidiary of the
Konka Electronic Company 16,297,996.30 2.70%
234
Relationship with Percentage in total other
Name of entity Amount
the Company account receivables (%)
Subsidiary of the
Mudanjiang Konka Company 4,089,193.57 0.68%
Subsidiary of the
Beijing Konka Company 26,600.00 0.00
Shenzhen OCT Real Estate Co., The same actual
Ltd. controller 1,209,064.86 0.20%
Subsidiary of the
Shushida Company 1,766,238.89 0.29%
Shenzhen Oct Water And Power Co., The same actual
Ltd controller 1,640,550.61 0.27%
Subsidiary of the
The South China Sea Institute Company 658,329.34 0.11%
Subsidiary of the
Xutongda Company 18,000.00 0.00
Shenzhen OCT Gas Station Co., The same actual
Ltd. controller 80,000.00 0.01%
Shenzhen OCT Property Service The same actual
Co., Ltd. controller 77,402.65 0.01%
Shareholder of
Chongqing Electronic the subsidiary 42,495,725.46 7.03%
Total 439,855,468.26 72.89%
(8)
Transfer amount of other account receivable not confirm to recognition was RMB 0.00
(9) The asset securitization use other accounts receivable as standard shall briefly explain
related arrangements
3. Long-term equity investments
Unit: RMB Yuan
(1) Category of long-term equity investments
Item Opening amount Increase Decrease Closing amount
Investment to the 1,557,259,154.56 1,723,300.00 10,723,300.00 1,548,259,154.56
235
Item Opening amount Increase Decrease Closing amount
subsidiary
Investment to
cooperative - 0.00
enterprise
Investment to
201,482,356.95 2,175,501.89 199,306,855.06
joint venture
Other equity
12,838,000.00 12,838,000.00
investments
Less: impairment
provision for
96,279,984.69 96,279,984.69
long term equity
investment
Total 1,675,299,526.82 1,723,300.00 12,898,801.89 1,664,124,024.93
(2) Details of long-term equity investment
Unit: RMB Yuan
Explan
ations
on Withdr
differ awal
ences amount
betwee Provis of Cash
Initia
Openin Increa Closin Shareh Voting n ion impair bonus
The Accoun l
g se/ g olding right shareh for ment in the
invest ting invest
balanc decrea balanc Propor Propor olding impair provis report
ee method ment
e se e tion tion propor ment ion in ing
cost
tion loss the period
and report
voting ing
right period
propor
tion
Mudanj 36,000 36,000 36,000 36,000
Cost
iang ,000.0 ,000.0 ,000.0 60.00% 60.00% — ,000.0
method
Konka 0 0 0 0
236
Shaanx 44,869 44,869 44,869
Cost
i ,809.8 ,809.8 ,809.8 60.00% 60.00% —
method
Konka 0 0 0
122,78 122,78 122,78
Anhui Cost
0,937. 0,937. 0,937. 78.00% 78.00% —
Konka method
98 98 98
Donggu 274,78 274,78 274,78
Cost 100.00 100.00
an 3,988. 3,988. 3,988. —
method % %
Konka 91 91 91
Hong
Cost 781,82 781,82 781,82 100.00 100.00
Kong —
method 8.61 8.61 8.61 % %
Konka
See
Anhui Cost 5,278, 5,278, 5,278,
6.55% 97.45% note
Konka method 509.85 509.85 509.85
①
Konka Cost 261,48 261,48 261,48 100.00 100.00
—
Europe method 2.50 2.50 2.50 % %
Nanhai Cost 500,00 500,00 500,00 100.00 100.00
—
Konka method 0.00 0.00 0.00 % %
Kunsha 350,00 350,00 350,00
Cost 100.00 100.00
n 0,000. 0,000. 0,000. —
method % %
Konka 00 00 00
Plasti
c Cost 4,655, 4,655, 4,655, 100.00 100.00
—
Produc method 000.00 000.00 000.00 % %
ts
Konka
Househ 10,732 10,732 10,732 10,732
Cost
old ,484.6 ,484.6 ,484.6 51.00% 51.00% — ,484.6
method
Applia 9 9 9 9
nces
Teleco
mmunic 90,000 90,000 90,000 See
Cost 100.00
ation ,000.0 ,000.0 ,000.0 75.00% note
method %
Techno 0 0 0 ②
logy
Konka
Cost 8,062, 8,062, 8,062, 100.00 100.00 8,062,
Americ —
method 500.00 500.00 500.00 % % 500.00
a
Inform 22,500 22,500 22,500 22,500
Cost 100.00 100.00 —
ation ,000.0 ,000.0 ,000.0 ,000.0
237
Networ method 0 0 0 % % 0
k
31,500 31,500 31,500
Shushi Cost 100.00 100.00
,000.0 ,000.0 ,000.0 —
da method % %
0 0 0
Video
&
Commun
icatio -9,000
Cost 9,000, 9,000,
n ,000.0 0.00 60.00% 60.00% —
method 000.00 000.00
System 0
s
Engine
ering
Chongq
17,100 17,100 17,100 17,100
ing Cost
,000.0 ,000.0 ,000.0 57.00% 57.00% — ,000.0
Electr method
0 0 0 0
onic
Fittin
48,750 48,750 48,750
gs Cost 100.00 100.00
,000.0 ,000.0 ,000.0 —
Techno method % %
0 0 0
logy
Kunsha
350,00 350,00 350,00
n Cost 100.00 100.00
0,000. 0,000. 0,000. —
Kangsh method % %
00 00 00
eng
Anhui 69,702 69,702 69,702 See
Cost 100.00 100.00
Tongch ,612.2 ,612.2 ,612.2 note
method % %
uang 2 2 2 ③
Konka
10,000 10,000 10,000
Optoel Cost 100.00 100.00
,000.0 ,000.0 ,000.0 —
ectron method % %
0 0 0
ic
10,000 10,000 10,000
Wankai Cost 100.00 100.00
,000.0 ,000.0 ,000.0 —
da method % %
0 0 0
Feihon
g
Cost 1,300, 1,300, 1,300, 1,300,
Electr 8.33% 8.33% —
method 000.00 000.00 000.00 000.00
onics
Co.,
238
Ltd.
Shenzh
en
Associ
ation
of
Enterp Cost 100,00 100,00 100,00 100,00
8.33% 8.33% —
rises method 0.00 0.00 0.00 0.00
with
Foreig
n
Invest
ment
Shenzh
en
Make-p
lan
Invest Cost 485,00 485,00 485,00 485,00
1.00% 1.00% —
ment method 0.00 0.00 0.00 0.00
Develo
pment
Co.,
Ltd.
IGRS
Inform
ation
Techno
logy Cost 5,000, 5,000, 5,000, 485,00
9.62% 9.62% —
Engine method 000.00 000.00 000.00 0.00
ering
Center
Co.,
Ltd.
Shenzh
en CTU Cost 1,153, 1,153, 1,153,
11.50% 11.50% —
Hi-tec method 000.00 000.00 000.00
h Ltd.
Shenzh
en
Digita Cost 2,400, 2,400, 2,400,
6.00% 6.00% —
l TV method 000.00 000.00 000.00
Nation
al
239
Engine
ering
Lab
Co.,
Ltd.
Shangh
ai
Digita
l TV
Nation
al Cost 2,400, 2,400, 2,400,
4.26% 4.26% —
Engine method 000.00 000.00 000.00
ering
R&D
Center
Co.,
Ltd.
Beijin
g 30,000 30,000 30,000
Cost 100.00 100.00
Konka ,000.0 ,000.0 ,000.0 —
method % %
Electr 0 0 0
onic
Shenzh
en
Shushi
da 10,000 10,000 10,000
Cost 100.00 100.00
Logist ,000.0 ,000.0 ,000.0 —
method % %
ics 0 0 0
Servic
e Co.,
Ltd.
Shangh
ai
Konka
Green
202,80 201,48 -2,175 199,30
Scienc Equity
0,000. 2,356. ,501.8 6,855. 39.00% 39.00% —
e and method
00 95 9 06
Techno
logy
Co.,
Ltd.
1,772, 1,771, -11,17 1,760, 96,764
Total -- -- --
897,15 579,51 5,501. 404,00 ,984.6
240
4.56 1.51 89 9.62 9
Note:
①The reason of the inconsistent of shareholding proportion, refer to Note VI, 1, ⑥
② The Company held 75% share equity of Telecommunication Technology, indirectly held 25%
share equity of Telecommunication Technology through the investment of subsidiary Konka
Household Appliances.
③The reason of the inconsistent of shareholding proportion, refer to Note VI, 1, ④
(3) Details of the impairment provision of long-term equity investment
Item Opening amount Increase Decrease Closing amount
Investment to the subsidiary
Mudanjiang Konka 36,000,000.00 36,000,000.00
Konka Household Appliances 10,732,484.69 10,732,484.69
KONKA AMERICA,INC. 8,062,500.00 8,062,500.00
Information Network 22,500,000.00 22,500,000.00
Chongqing Electronic 17,100,000.00 17,100,000.00
Other long-term equity investment
Feihong Electronics Co., Ltd. 1,300,000.00 1,300,000.00
Shenzhen Association of
Enterprises with Foreign 100,000.00 100,000.00
Investment
Shenzhen Make-plan Investment
485,000.00 485,000.00
Development Co., Ltd.
Total 96,279,984.69 96,279,984.69
4. Revenues and operating costs
(1) Revenues and operating costs
Unit: RMB Yuan
Item Reporting period Same period of last year
Revenues from main
6,107,837,519.70 7,585,146,118.79
operations
Revenues from other
2,348,170,914.33 2,117,072,605.35
operations
Total revenues 8,456,008,434.03 9,702,218,724.14
Operating costs 7,493,298,863.06 8,499,715,386.70
(2) Main operations (by industries)
Unit: RMB Yuan
241
Reporting period Same period of last year
Industry
Revenues Operating costs Revenues Operating costs
Electronic industry 6,107,837,519.70 5,173,842,033.18 7,585,146,118.79 6,399,306,613.49
Total 6,107,837,519.70 5,173,842,033.18 7,585,146,118.79 6,399,306,613.49
(3) Main operations (by products)
Unit: RMB Yuan
Reporting period Same period of last year
Industry
Revenues Operating costs Revenues Operating costs
Color TV business 5,759,146,947.22 4,852,910,947.89 7,193,714,335.47 6,038,011,984.73
Consumer appliances
308,491,356.79 280,926,543.15 314,564,511.73 284,545,946.01
business
Others 40,199,215.69 40,004,542.14 76,867,271.59 76,748,682.75
Subtotal 6,107,837,519.70 5,173,842,033.18 7,585,146,118.79 6,399,306,613.49
(4) Main operations (by regions)
Unit: RMB Yuan
Reporting period Same period of last year
Region
Revenues Operating costs Revenues Operating costs
Domestic sales 5,144,713,192.68 4,237,235,966.65 6,691,973,676.52 5,507,625,473.12
Overseas sales 963,124,327.02 936,606,066.53 893,172,442.27 891,681,140.37
Subtotal 6,107,837,519.70 5,173,842,033.18 7,585,146,118.79 6,399,306,613.49
(5) Revenues from the top five customers
Unit: RMB Yuan
Customer Name Total operating income Proportion
Jan.-Jun. 2014 1,617,573,267.76 19.13%
Total 1,617,573,267.76 19.13%
Note:
5. Investment income
(1) List of investment income
Unit: RMB Yuan
Item Reporting period Same period of last year
Long-term equity investment income accounted by
-2,175,501.89
equity method
Investment income arising from disposal of
255,080,452.51
long-term equity investments
242
Investment income received from holding of
48,104.52 21,115.80
available-for-sale financial assets
Other 2,217,922.37
Total 255,170,977.51 21,115.80
(2) Long-term equity investment income accounted by cost method
Unit: RMB Yuan
Same period of
Name of investee Reporting period Reason for increase/decrease
last year
(3) Long-term equity investment income accounted by equity method
Unit: RMB Yuan
Same period of
Name of investee Reporting period Reason for increase/decrease
last year
Shanghai Konka Green Technology Co.,
-2,175,501.89
Ltd.
Total -2,175,501.89 --
Note:
6. Supplemental information for Cash Flow Statement
Unit: RMB Yuan
Supplemental information Reporting period Same period of last year
1. Reconciliation of net profit to net cash flows
-- --
generated from operations：
Net profit 43,217,953.84 89,082,493.81
Add: Provision for assets impairments 27,776,711.70 15,096,511.60
Depreciation of fixed assets, oil-gas assets and
14,903,834.34 14,155,355.84
productive biological assets
Amortization of intangible assets 2,018,224.71 1,074,662.30
Amortization of long-term deferred expense 719,192.70 414,627.07
Losses/gains on disposal of property, intangible asset
34,633.28 -10,673,034.17
and other long-term assets (gains: negative)
Losses on scrapped of fixed assets (gains: negative) 1,474,982.32 708,641.08
Financial expense (gains: negative) 41,324,170.57 40,285,879.28
Investment loss (gains: negative) -255,170,977.51 -21,115.80
243
Decrease in deferred tax assets (increase: negative) -7,862,494.79 27,487,758.76
Increase in deferred tax liabilities (decrease:
0.00
negative)
Decrease in inventory (increase: negative) 355,960,617.25 610,239,785.09
Decrease in accounts receivable from operating
664,597,221.78 1,160,265,454.56
activities (increase: negative)
Increase in accounts payable from operating activities
-55,223,913.52 266,235,504.36
(decrease: negative)
Net cash flow from operating activities 833,770,156.67 2,214,352,523.78
2. Significant investing and financing activities
-- --
without involvement of cash receipts and payments
3. Change of cash and cash equivalent: -- --
Closing balance of Cash 1,058,466,056.30 1,218,285,373.71
Less: opening balance of cash 1,117,689,643.16 365,891,615.75
Net increase of cash and cash equivalents -59,223,586.86 852,393,757.96
7. Assets and liabilities recorded by assessed value under counter purchase
Assets and liabilities recorded by fair value under counter purchase
Unit: RMB Yuan
Computational
Item Fair value Determine method Original book value
process
Long-term equity investment formed by counter purchase
Unit: RMB Yuan
Item Amount Computational process
XVI. Supplemental information
1. Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Item Amount Note
Gains/losses on the disposal of non-current assets
(including the offset part of asset impairment 259,145,561.57
provisions)
Tax rebates, reductions or exemptions due to approval
beyond authority or the lack of official approval 18,563,326.67
documents
Gains and losses on change in fair value from tradable 48,104.52
244
financial assets and tradable financial liabilities,
as well as investment income from disposal of tradable
financial assets and tradable financial liabilities
and financial assets available for sales except for
effective hedging related with normal businesses of
the Company
Other non-operating income and expenses other than the
5,859,380.45
above
Less: Income tax effects 66,795,954.71
Minority interests effects (after tax) -473,271.65
Total 217,293,690.15 --
The government subsidy recorded into current profits or losses was current profits or losses, shall be disclosed
the recognition reason one by one.
□ Applicable √ Inapplicable
2. 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
Unit: RMB Yuan
Net profit attributable to shareholders Net assets attributable to
of the Company shareholders of the Company
2014 2013 Closing amount Opening amount
According to Chinese
45,360,110.62 40,547,673.62 4,115,975,334.28 4,080,458,151.63
accounting standards
Items and amounts adjusted according to international accounting standards
(2) Differences of net profit and net assets disclosed in financial reports prepared under
overseas and Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders Net assets attributable to
of the Company shareholders of the Company
2014 2013 Closing amount Opening amount
According to Chinese
45,360,110.62 40,547,673.62 4,115,975,334.28 4,080,458,151.63
accounting standards
Items and amounts adjusted according to international accounting standards
245
(3) Explain reasons for the differences between accounting data under domestic and overseas
accounting standards
No difference for 2014
3. Return on equity and earnings per share
Unit: RMB Yuan
The weighted average EPS
Profit in the reporting period
ROE (%) Basic EPS Diluted EPS
Net profit attributable to the
1.11% 0.0377 0.0377
Company's common stock shareholders
Net profit attributable to the
Company's common stock shareholders
-4.19% -0.1428 -0.1428
after deducting non-recurring profit
and loss
4. Particulars on the abnormal conditions of main items in the financial statements
of the Company and relevant reasons
1. Items of balance sheet:
(1) Interest receivable on 30 Jun. 2014 was RMB 5,820,820.78, increased by 100.83%
than that in the opening period, mainly due to the increase of structured products
and wealth management products.
(2) Prepayment on 30 Jun. 2014 was RMB 732，908，512.60, increased by 346.15% than
that in the opening period, mainly due to ① prepaid payment of land RMB 488,063,979,
② the increase of prepayment of purchase of materials.
(3) Construction in progress on Jun. 2014 was RMB 102,548,970.02, increased by
105.41% than that in the opening period, mainly due to the increase of the expense
of factory and infrastructure.
(4) Long-term borrowing on 30 Jun. 2014 was RMB 326,110,836.38 increased by 6422.22%
than that in the opening period, mainly due to the increase of the long-term borrowing
gained by the subsidiary.
2. Items of profit statement and cash flow statement
(1) The operating income in the first half of 2014 was RMB 8,398,300,541.63, decreased
by 10.86, than that in same period of last year, mainly due to the decrease of color
TV business scale.
(2) Operating cost in the first half of 2014 was RMB 7,010,567,842.76, decreased
by 10.53% than that in same period of last year, mainly due to the decrease of color
246
TV business scale, the related income and the cost.
(4) Financial expense in the first half of 2014 was RMB 101,860,777.24, increased
by 569.25%, than that in same period of last year, mainly due to exchange rate
fluctuation leading to the increase of exchange gain or loss.
(6) Investment income in the first half of 2014 was RMB 266,440,118.63, increased
by 3358.58% than that in same period of last year, mainly due to profits from the
transfer of Konka Video in the reporting period.
(9) Cash received from the sale of products and rendering service in the first half
of 2014 was RMB 8,265,282,430.24 than that in same period of last year, mainly due
to the sale income decreased than that in same period of last year, and returned
money decreased either.
(10) Receivable of refund of tax in the first half of 2014 was RMB 196,033,233.62,
increased by 27.76 than that in same period of last year, mainly due to the increase
of software VAT refund
(11) Other tax payment in the first half of 2014 was RMB 414,347,427.94, decreased
by 56.61% than that in same period of last year, mainly due to import link value-added
tax and tariff was included into other tax payment in same period of last year, and
was adjusted into the cash received from the sale of products and rendering service.
(12) Cash received from the gain of investment income in the first half of 2014 was
RMB 237,122,193.56 than that in same period of last year, mainly due to investment
income gained from the transfer of Konka Video.
(13) Cash received from other related investment activities in the first half of
2014 was RMB 200,000,000, increased by 100% than that in same period of last year,
mainly due to the wealth management products due to pay.
(14) Cash paid to other related investment activities in the first half of 2014 was
RMB 603,365,645.37 increased by 100% than that in same period of last year, mainly
due to the expense of purchasing finance products.
247
Section X. Documents Available for Reference
I. Financial statements with the signatures and seals of the company principal, the
principal of accounting work and the principal of the accounting organ (financial
manager);
III. Texts of all the Company’s documents ever publicly disclosed in newspapers
designated by CSRC in the reporting period, and the originals of the public notices.
III. Other relevant materials.
Chairman of the Board: Wu Siyuan
The Board of Directors
Konka Group Co., Ltd.
28 August 2014
248
