Konka Group Co., Ltd. Annual Report 2020
KONKA GROUP CO., LTD.
ANNUAL REPORT 2020
2021-28
March 2021
1
Konka Group Co., Ltd. Annual Report 2020
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of Konka Group Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
Liu Fengxi, the Company’s legal representative, Li Chunlei, the Company’s Chief Financial
Officer (CFO), and Guo Zhihua, head of the Company’s financial department (equivalent to
financial manager) hereby guarantee that the Financial Statements carried in this Report are
factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Any plans for the future or other forward-looking statements mentioned in this Report and its
summary shall NOT be considered as absolute promises of the Company to investors.
Therefore, investors are reminded to exercise caution when making investment decisions.
The Board has approved a final dividend plan as follows: based on the 2,407,945,408 shares, a
cash dividend of RMB1 (tax inclusive) per 10 shares is to be distributed to the shareholders,
with no bonus issue from either profit or capital reserves.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
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Konka Group Co., Ltd. Annual Report 2020
Table of Contents
Part I Important Notes, Table of Contents and Definitions........................................................... 2
Part II Corporate Information and Key Financial Information................................................. 10
Part III Business Summary............................................................................................................. 15
Part IV Operating Performance Discussion and Analysis............................................................18
Part V Significant Events.................................................................................................................44
Part VI Share Changes and Shareholder Information................................................................. 98
Part VII Preferred Shares..............................................................................................................105
Part VIII Convertible Corporate Bonds...................................................................................... 106
Part IX Directors, Supervisors, Senior Management and Staff.................................................107
Part X Corporate Governance...................................................................................................... 118
Part XI Corporate Bonds...............................................................................................................130
Part XII Financial Statements.......................................................................................................134
Part XIII Documents Available for Reference............................................................................. 418
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Konka Group Co., Ltd. Annual Report 2020
Definitions
Term Definition
The “Company”, the “Group”, “Konka Group” or Konka Group Co., Ltd. and its consolidated subsidiaries, except where the
“we” context otherwise requires
Konka Ventures Konka Ventures Development (Shenzhen) Co., Ltd.
Yantai Konka Yantai Konka Healthcare Enterprise Service Co., Ltd.
Chengdu Anren Chengdu Anren Konka Cultural and Creative Incubator Management Co., Ltd.
Konka Enterprise Service Guiyang Konka Enterprise Service Co., Ltd.
Chuanghui Smart Nanjing Chuanghui Smart Technology Co., Ltd.
Yibin Konka Incubator Yibin Konka Incubator Management Co., Ltd.
Anhui Konka Anhui Konka Electronic Co., Ltd.
Kangzhi Trade Anhui Kangzhi Trade Co., Ltd.
Konka Factoring Konka Factoring (Shenzhen) Co., Ltd.
Konka Unifortune Shenzhen Konka Unifortune Technology Co., Ltd.
Jiali International Jiali International (Hong Kong) Limited
Wankaida Shenzhen Wankaida Science and Technology Co., Ltd.
Dongguan Konka Dongguan Konka Electronic Co., Ltd.
Suining Konka Smart Suining Konka Smart Technology Co., Ltd.
Konka Europe Konka (Europe) Co., Ltd.
Konka Electrical Appliances Shenzhen Konka Electrical Appliances Co., Ltd.
Telecommunication Technology Shenzhen Konka Telecommunications Technology Co., Ltd.
Konka Mobility Konka Mobility Co., Limited
Mobile Interconnection Shenzhen Konka Mobile Interconnection Technology Co., Ltd.
Sichuan Konka Sichuan Konka Smart Terminal Technology Co., Ltd
Yibin Smart Yibin Konka Smart Technology Co., Ltd.
Anhui Tongchuang Anhui Konka Tongchuang Electrical Appliances Co., Ltd.
Anhui Electrical Appliance Anhui Konka Electrical Appliance Technology Co., Ltd.
Frestec Refrigeration Henan Frestec Refrigeration Appliance Co., Ltd.
Frestec Smart Home Henan Frestec Smart Home Technology Co., Ltd.
Frestec Electrical Appliances Henan Frestec Electrical Appliances Co., Ltd.
Frestec Household Appliances Henan Frestec Household Appliances Co., Ltd.
Jiangsu Konka Smart Jiangsu Konka Smart Electrical Appliances Co., Ltd.
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Konka Group Co., Ltd. Annual Report 2020
Kangjiatong Sichuan Kangjiatong Technology Co., Ltd.
Pengrun Technology Shenzhen Konka Pengrun Technology & Industry Co., Ltd.
Jiaxin Technology Jiaxin Technology Co., Ltd.
Dongguan Packing Dongguan Konka Packing Materials Co., Ltd.
E2info Shenzhen E2info Network Technology Co., Ltd.
E2info (Hainan) E2info (Hainan) Network Technology Co., Ltd.
Beijing Konka Electronic Beijing Konka Electronic Co., Ltd.
Konka Leasing Konka Financial Leasing (Tianjin) Co., Ltd.
Konka Circuit Shenzhen Kangjia circuit Co., Ltd.
Boluo Konka Precision Boluo Konka Precision Technology Co., Ltd.
Xiamen Dalong Xiamen Dalong Trading Co., Ltd.
Boluo Konka Boluo Konka PCB Co., Ltd.
Hong Kong Konka Hong Kong Konka Limited
Konka Electrical Appliances Investment Konka Electrical Appliances Investment & Development Co., Ltd.
Chain Kingdom Memory Technologies Chain Kingdom Memory Technologies Co., Limited
Chain Kingdom Memory Technologies
Chain Kingdom Memory Technologies (Shenzhen) Co., Ltd.
(Shenzhen)
Hefei KONSEMI Hefei KONSEMI Storage Technology Co., Ltd.
Konka SmartTech Konka SmartTech Limited
Kangjietong Kangjietong (Hong Kong) Limited
Konka Electrical Appliances International Trading Konka Electrical Appliances International Trading Co., Ltd.
Kanghao Technology Kanghao Technology Co., Ltd.
Konka North America Konka North America LLC
Konka Investment Shenzhen Konka Investment Holding Co., Ltd.
Yibin Konka Technology Park Yibin Konka Technology Park Operation Co., Ltd.
Konka Capital Shenzhen Konka Capital Equity Investment Management Co., Ltd.
Konka Suiyong Konka Suiyong Investment (Shenzhen) Co., Ltd.
Kangquan Enterprise Shenzhen Kangquan Enterprise Management Consulting Co., Ltd.
Konka Suyuan Shenzhen Konka Suyuan Investment Industrial Co., Ltd.
Shengxing Industrial Shenzhen Konka Shengxing Industrial Co., Ltd.
Industrial Park Development Shenzhen Konka Industrial Park Development Co., Ltd.
Zhitong Technology Shenzhen Konka Zhitong Technology Co., Ltd.
Electronics Technology Shenzhen Konka Electronics Technology Co., Ltd.
Anhui Zhilian Anhui Konka Zhilian E-Commerce Co., Ltd.
Youzhihui Shenzhen Youzhihui Technology Co., Ltd.
Xiaojia Technology Shenzhen Xiaojia Technology Co., Ltd.
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Konka Group Co., Ltd. Annual Report 2020
Haimen Konka Haimen Konka Smart Technology Co., Ltd.
Chengdu Konka Smart Chengdu Konka Smart Technology Co., Ltd.
Chengdu Konka Electronic Chengdu Konka Electronic Co., Ltd.
XingDa HongYe GuangDong XingDa HongYe Electronic Co., Ltd.
Shanghai Xinfeng Shanghai Xinfeng Zhuoqun PCB Co., Ltd.
Liaoyang Kangshun Smart Liaoyang Kangshun Smart Technology Co., Ltd.
Liaoyang Kangshun Renewable Liaoyang Kangshun Renewable Energy Co., Ltd.
Nanjing Konka Nanjing Konka Electronics Co., Ltd.
Yantai Laikang Yantai Laikang Industrial Development Co., Ltd.
Econ Technology Shandong Econ Technology Co., Ltd.
Beijing Econ Beijing Econ Runfeng Technology Co., Ltd.
Shanghai Jiyi Shanghai Jiyi Environmental Technology Co., Ltd.
Binzhou Econ Zhongke Binzhou Econ Zhongke Environmental Technology Co., Ltd.
Lairun Holding Laizhou Lairun Holding Co., Ltd.
Lairun Environmental Protection Laizhou Lairun Environmental Protection Co., Ltd.
Lairun Wastewater Laizhou Lairun Wastewater Treatment Co., Ltd.
Binhai Wastewater Laizhou Binhai Wastewater Treatment Co., Ltd.
Econ Environmental Engineering Econ Environmental Engineering Co., Ltd.
Rushan Econ Rushan Econ Water Environment Management Co., Ltd.
Binzhou Weiyijie Binzhou Weiyijie Environmental Technology Co., Ltd.
Binzhou Beihai Jingmai Binzhou Beihai Jingmai Industrial Development Co., Ltd.
Chunzhiran Yantai Chunzhiran Environmental Technology Co., Ltd.
Donggang Kangrun Donggang Kangrun Environmental Management Co., Ltd.
Kangrunhong Environmental Kangrunhong Environmental Technology (Yantai) Co., Ltd.
Dayi Kangrun Water Dayi Kangrun Water Co., Ltd.
Suining Pengxi Kangrun Suining Pengxi Kangrun Environmental Management Co., Ltd.
Subei Kangrun Water Subei Mongol Autonomous County Kangrun Water Co., Ltd.
Weifang Sihai Kangrun Weifang Sihai Kangrun Investment Operation Co., Ltd.
Lushan Kangrun Environmental Lushan Kangrun Environmental Management Co., Ltd.
Funan Kangrun Water Funan Kangrun Water Co., Ltd.
Wuhan Runyuan Wastewater Wuhan Runyuan Wastewater Treatment Co., Ltd.
Tongchuan Kangrun Honghui Tongchuan Kangrun Honghui Environmental Management Co., Ltd.
Tingyuan Environmental Tingyuan Environmental Technology (Shanghai) Co., Ltd.
Gaoping Kangrun Gaoping Kangrun Environmental Protection & Water Co., Ltd.
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Konka Group Co., Ltd. Annual Report 2020
Mengcheng Kangrun Mengcheng Kangrun Anjian Water Co., Ltd.
Xixian Kangrun Xixian Kangrun Xijian Water Environment Development Co., Ltd.
Chongzhou Kangrun Chongzhou Kangrun Environment Co., Ltd.
Xi’an Kangrun Xi’an Gaoling Kangrun Environmental Engineering Co., Ltd.
Ankang Kangrun Ankang Kangrun Xinheng Water Environment Co., Ltd.
Changning Kangrun Changning Kangrun Water Co., Ltd.
Bokang Renewable Bokang Renewable Resources (Yantai) Co., Ltd.
Linfen Kangrun Linfen Kangrun Jinze Water Supply Co., Ltd.
Konka Huanjia Konka Huanjia (Dalian) Environmental Technology Co., Ltd.
Konka Huanjia (Henan) Konka Huanjia (Henan) Environmental Technology Co., Ltd.
Shanghai Konka Shanghai Konka Industrial Co., Ltd.
Yantai Kangjin Yantai Kangjin Technology Development Co., Ltd.
Jiangxi Konka Jiangxi Konka New Material Technology Co., Ltd.
Xinfeng Microcrystalline Jiangxi Xinfeng Microcrystalline Jade Co., Ltd.
Nano Crystallized Glass Jiangxi Golden Phoenix Nano Crystallized Glass Co., Ltd.
Jiangsu Konka Special Material Jiangsu Konka Special Material Technology Co., Ltd.
Shenzhen Nianhua Shenzhen Nianhua Enterprise Management Co., Ltd.
Shenzhen KONSEMI Shenzhen KONSEMI Co., Ltd.
Hefei KONSEMI Hefei KONSEMI Storage Technology Co., Ltd.
Yihe Electronic Hefei Yihe Electronic Co., Ltd.
Chongqing Konka Chongqing Konka Technology Development Co., Ltd.
Shenzhen Huiying Technology Shenzhen Konka Huiying Technology Co., Ltd.
Chongqing Huiying Technology Chongqing Konka Huiying Technology Co., Ltd.
Konka Eco-Development Shenzhen Konka Eco-Development Investment Co., Ltd.
Suining Konka Industrial Park Suining Konka Industrial Park Development Co., Ltd.
Konka Ronghe Konka Ronghe Industrial Technology (Zhejiang) Co., Ltd.
Suining Electronic Technological Innovation Suining Konka Electronic Technological Innovation Co., Ltd.
Shenzhen Chuangzhi Electrical Appliances Shenzhen Konka Chuangzhi Electrical Appliances Co., Ltd.
Kanghong (Yantai) Environmental Kanghong (Yantai) Environmental Technology Co., Ltd.
Chongqing Kangxingrui Chongqing Kangxingrui Environmental Technology Co., Ltd.
Chongqing Kangxingrui Automobile Recycling Chongqing Kangxingrui Scraped Automobile Recycling Co., Ltd.
Chongqing Optoelectronic Technology Research
Chongqing Konka Optoelectronic Technology Research Institute Co., Ltd.
Institute
Xinying Semiconductor Konka Xinying Semiconductor Technology (Shenzhen) Co., Ltd.
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Konka Group Co., Ltd. Annual Report 2020
Konka Xinyun Semiconductor Konka Xinyun Semiconductor Technology (Yancheng) Co., Ltd.
Jiangkang (Shanghai) Technology Jiangkang (Shanghai) Technology Co., Ltd.
Ningbo Kanghanrui Electrical Appliances Ningbo Kanghanrui Electrical Appliances Co., Ltd.
Konka Intelligent Manufacturing Shenzhen Konka Intelligent Manufacturing Technology Co., Ltd.
Suining Jiarun Property Suining Jiarun Property Co., Ltd.
Yantai Kangyun Yantai Kangyun Industrial Development Co., Ltd.
Yantai Kangyun Property Yantai Kangyun Property Development Co., Ltd.
Chongqing Kanglei Optoelectronic Chongqing Kanglei Optoelectronic Technology Co., Ltd.
Yibin Kangrun Yibin Kangrun Environmental Technology Co., Ltd.
Henan Kangxin Property Henan Kangxin Property Co., Ltd.
Konka Material Hainan Konka Material Technology Co., Ltd.
Shenzhen Kangxin Property Shenzhen Kangxin Property Co., Ltd.
Henan Kanghan Property Henan Kanghan Property Co., Ltd.
Chengdu Konka Incubator Chengdu Konka Incubator Management Co., Ltd.
Cross-Border Technological Innovation Shenzhen Konka Cross-Border Technological Innovation Service Co., Ltd.
Konka Enterprise Management Guizhou Konka Enterprise Management Service Co., Ltd.
Youshi Kangrong Youshi Kangrong Culture Communication Co., Ltd.
Life Electric Appliance Shenzhen Konka Life Electric Appliance Co., Ltd.
Commercial System Technology Shenzhen Konka Commercial System Technology Co., Ltd.
Frestec Smart Henan Frestec Smart Eco Electrical Appliances Co., Ltd.
E3info E3info (Hainan) Technology Co., Ltd.
Yifang Technology Shenzhen Konka Yifang Technology Co., Ltd.
Yuekang Semiconductor Yuekang Semiconductor Technology (Yantai) Co., Ltd.
Kangshi Virtual Kangshi Virtual Technology (Yantai) Co., Ltd.
Industrial New Town Sichuan Konka Industrial New Town Development Co., Ltd.
Kangxin Technology Shenzhen Konka Kangxin Technology Co., Ltd.
Hainan Technology Hainan Konka Technology Industry Development Co., Ltd.
Nanjing Konka Nanjing Konka Smart Technology Co., Ltd.
Zhongshan Kangxin Electronic Zhongshan Kangxin Electronic Technology Co., Ltd.
Zhongshan Kang’ao Zhongshan Kang’ao Electronic Co., Ltd.
Boxing Xingkang Environmental Boxing Xingkang Environmental Technology Co., Ltd.
Yantai Konka Industrial Yantai Konka Industrial Co., Ltd.
Shandong Kangxin Shandong Kangxin Industrial Development Co., Ltd.
Shenzhen Morsemi Shenzhen Morsemi Semiconductor Technology Co., Ltd.
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Konka Group Co., Ltd. Annual Report 2020
Zhengmao Semiconductor Chongqing Zhengmao Semiconductor Co., Ltd.
Dongguan Konka Investment Dongguan Konka Investment Co., Ltd.
Kanghong (Yantai) Environmental Technology
Kanghong (Yantai) Environmental Technology Park Co., Ltd.
Park
Chongqing Konka Property Development Chongqing Konka Property Development Co., Ltd.
Chongqing Xingyi Property Chongqing Konka Xingyi Property Co., Ltd.
Chongqing Fuze Property Chongqing Konka Fuze Property Co., Ltd.
Debao New Material Anhui Konka Debao New Material Technology Co., Ltd.
Chuzhou Kangxin Health Industry Chuzhou Kangxin Health Industry Development Co., Ltd.
Kangxinlong Environmental Protection Hubei Kangxinlong Environmental Protection Co., Ltd.
Chongqing Chengda Chongqing Chengda Property Co., Ltd.
Chongqing Chunfu Chongqing Chunfu Property Co., Ltd.
Chongqing Langheng Chongqing Langheng Property Co., Ltd.
Morsemi Hong Kong Morsemi Semiconductor Technology (Hong Kong) Limited
CSRC The China Securities Regulatory Commission
SZSE The Shenzhen Stock Exchange
CSRC Shenzhen The Shenzhen Bureau of the China Securities Regulatory Commission
Expressed in the Chinese currency of Renminbi, expressed in tens of thousands
RMB, RMB’0,000, RMB’00,000,000
of Renminbi, expressed in hundreds of millions of Renminbi
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Konka Group Co., Ltd. Annual Report 2020
Part II Corporate Information and Key Financial Information
I Corporate Information
Konka Group-A, Konka
Stock name Stock code 000016, 200016
Group-B
Changed stock name (if any) N/A
Stock exchange for stock listing Shenzhen Stock Exchange
Company name in Chinese 康佳集团股份有限公司
Abbr. 康佳集团
Company name in English (if
KONKA GROUP CO.,LTD
any)
Abbr. (if any) KONKA GROUP
Legal representative Liu Fengxi
15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology Park,
Registered address
Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China
Zip code 518057
15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology Park,
Office address
Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China
Zip code 518057
Company website www.konka.com
Email address szkonka@konka.com
II Contact Information
Board Secretary Securities Representative
Name Wu Yongjun Miao Leiqiang
Board Secretariat, 24/F, Konka R&D Center, Board Secretariat, 24/F, Konka R&D Center,
28 Keji South Twelfth Road, Science and 28 Keji South Twelfth Road, Science and
Address Technology Park, Yuehai Street, Nanshan Technology Park, Yuehai Street, Nanshan
District, Shenzhen, Guangdong Province, District, Shenzhen, Guangdong Province,
China China
Tel. 0755-26609138 0755-26609138
Fax 0755-26601139 0755-26601139
Email address szkonka@konka.com szkonka@konka.com
III Media for Information Disclosure and Place where this Report Is Lodged
Newspapers designated by the Company for
Securities Times, etc.
information disclosure
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Konka Group Co., Ltd. Annual Report 2020
Website designated by CSRC for publication of
http://www.cninfo.com.cn/new/index
this Report
Board Secretariat, 24/F, Konka R&D Center, 28 Keji South Twelfth Road,
Place where this Report is lodged Science and Technology Park, Yuehai Street, Nanshan District, Shenzhen,
Guangdong Province, China
IV Change to Company Registered Information
Unified social credit code 914403006188155783
Change to principal activity of the Company
No change
since going public (if any)
Every change of controlling shareholder since
No change
incorporation (if any)
V Other Information
The independent audit firm hired by the Company:
Name Shinewing Certified Public Accountants LLP
9/F, Block A, Fuhua Mansion, No.8 Chaoyangmen North Street, Dongcheng District,
Office address
Beijing, China
Accountants writing signatures Guo Dongchao and Zhan Miaoling
The independent sponsor hired by the Company to exercise constant supervision over the Company
in the Reporting Period:
□ Applicable √ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the
Company in the Reporting Period:
□ Applicable √ Not applicable
VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
2020-over-20
2020 2019 19 change 2018
(%)
Operating revenue (RMB) 50,351,836,554.87 55,119,125,478.72 -8.65% 46,126,797,341.33
Net profit attributable to the listed
477,633,250.14 212,034,210.08 125.26% 411,289,744.68
company’s shareholders (RMB)
Net profit attributable to the listed -2,367,590,806.95 -1,875,722,546.18 -26.22% -795,400,491.44
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Konka Group Co., Ltd. Annual Report 2020
company’s shareholders before
exceptional gains and losses (RMB)
Net cash generated from/used in
178,616,528.21 -1,543,947,284.59 111.57% -3,229,823,872.66
operating activities (RMB)
Basic earnings per share
0.1984 0.0881 125.20% 0.1708
(RMB/share)
Diluted earnings per share
0.1984 0.0881 125.20% 0.1708
(RMB/share)
Weighted average return on equity
5.79% 2.62% 3.17% 5.11%
(%)
Change of 31
December
31 December 2020 31 December 2019 2020 over 31 31 December 2018
December
2019 (%)
Total assets (RMB) 49,876,267,493.61 42,586,955,452.27 17.12% 32,985,061,889.03
Equity attributable to the listed
8,428,640,176.97 8,068,505,598.13 4.46% 8,104,736,790.53
company’s shareholders (RMB)
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative for the last three accounting
years, and the latest independent auditor’s report indicated that there was uncertainty about the
Company’s ability to continue as a going concern.
□ Yes √ No
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative.
√ Yes □ No
Item 2020 2019 Note
Operating revenue (RMB) 50,351,836,554.87 55,119,125,478.72
Revenue from scrap sales,
utilities revenue, handling
Deductions from operating
56,103,050.39 31,986,803.24 charges received and other
revenue (RMB)
revenue not related to the
principal business activities
Operating revenue net of
50,295,733,504.48 55,087,138,675.48
deductions (RMB)
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Konka Group Co., Ltd. Annual Report 2020
VII Accounting Data Differences under China’s Accounting Standards for Business
Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign
Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
No difference for the Reporting Period.
VIII Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 7,806,520,237.49 9,717,663,659.25 12,276,961,374.42 20,550,691,283.71
Net profit attributable to the
-220,602,940.37 315,304,733.00 520,661,894.19 -137,730,436.68
listed company’s shareholders
Net profit attributable to the
listed company’s shareholders
-333,520,116.21 -316,490,379.26 -843,908,630.71 -873,671,680.77
before exceptional gains and
losses
Net cash generated from/used in
-1,031,223,468.58 -45,143,458.90 -99,506,432.85 1,354,489,888.54
operating activities
Indicate by tick mark whether any of the quarterly financial data in the table above or their
summations differs materially from what have been disclosed in the Company’s quarterly or interim
reports.
□ Yes √ No
IX Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item 2020 2019 2018 Note
Gain or loss on disposal of non-current assets
2,431,648,255.26 1,202,401,420.41 732,818,574.90
(inclusive of impairment allowance write-offs)
Government subsidies charged to current profit 908,546,202.24 1,204,519,346.40 259,609,022.27
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Konka Group Co., Ltd. Annual Report 2020
or loss (exclusive of government subsidies given
in the Company’s ordinary course of business at
fixed quotas or amounts as per the government’s
uniform standards)
Gain equal to the amount by which investment
costs for the Company to obtain subsidiaries,
associates and joint ventures are lower than the 220,045,229.63
Company’s enjoyable fair value of identifiable
net assets of investees when making investments
Gain or loss on assets entrusted to other entities
18,476,648.12 71,541,978.85 182,022,653.32
for investment or management
Gain or loss on debt restructuring 1,127,066.94 14,515,006.57
Gain or loss on fair-value changes in
held-for-trading and derivative financial assets
and liabilities & income from disposal of
held-for-trading and derivative financial assets
96,316,772.78 49,472,415.17 39,542,461.74
and liabilities and other investments in debt
obligations (exclusive of the effective portion of
hedges that arise in the Company’s ordinary
course of business)
Gain or loss on loan entrustments 64,616,181.90 1,992,676.20 1,389,042.48
Non-operating income and expense other than
54,271,037.60 121,189,478.51 73,907,331.00
the above
Other gains and losses that meet the definition of
1,081,111.64 145,586,810.18 17,974,523.98
exceptional gain/loss
Less: Income tax effects 544,211,364.67 545,067,993.60 253,497,204.45
Non-controlling interests effects (net of
186,647,854.72 178,394,382.43 67,121,398.75
tax)
Total 2,845,224,057.09 2,087,756,756.26 1,206,690,236.12 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or
listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering
Their Securities to the Public—Exceptional Gain/Loss Items:
√ Applicable □ Not applicable
Amount involved
Item Reason
(RMB)
Tax
Government subsidies given in the Company’s ordinary course of business at fixed quotas
rebates on 30,710,313.50
or amounts as per government’s uniform standards
software
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Konka Group Co., Ltd. Annual Report 2020
Part III Business Summary
I Principal Activity of the Company in the Reporting Period
(I) The Consumer Electronic Division
This division primarily comprises the multimedia sub-division and the white goods sub-division,
with details as follows:
1. The Multimedia Sub-Division
The Company provides multimedia products and services, including colour TVs and Internet TV
services, for both domestic and overseas markets.
The domestic sales of the Company’s colour TVs are realized mainly through B2B
(Business-to-Business) and B2C (Business-to-Consumer), with its branch companies, business
departments and after-sales maintenance points operating across the country. And the Company
profits from the margins between the costs and the selling prices of its colour TVs.
As for selling its colour TVs abroad, the Company mainly relies on B2B. Its colour TVs are sold to
Asia Pacific, Middle East, Central & South America, East Europe, etc. And operating profit source
is also the differences between the costs and the selling prices of its colour TVs.
Internet business is based on the intelligent TV terminals sold by our company. It mainly carries out
three aspects of business. Firstly, it works with other Internet companies to provide end users with,
among other content, video, educational, music, medical and game content to generate earnings.
Secondly, it analyses user behaviours and offer certain free, interactive services to increase
attractiveness to users, promote its brand and stimulate desire for its hardware products. Finally, it is
trying to build an Internet TV platform with tens of millions of users, on which it will profit through
commercial and application distribution. This Internet TV business is key to the Company’s
Internet-oriented transformation and upgrade to a development model of “hardware + software” and
“smart TV + end users”.
2. The White Goods Sub-Division
The white goods produced by the Company mainly include refrigerators, washing machines, air
conditioners, freezers, etc., which are sold through B2B and B2C mainly to the domestic market.
And the Company profits from the margins between the costs and the selling prices of its white
goods. The Company strengthened the foundation of our white goods brands through the acquisition
of the Frestec brand. The Company also optimized the internal R&D, production, procurement,
sales, and services processes and integrated the external channel resources to enable channel sharing
between the upstream procurement processes and downstream sales processes. By taking advantage
of this opportunity, the Company improved the product and sales structure and enhanced the
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Konka Group Co., Ltd. Annual Report 2020
management of online channels.
(II) The Industry Trade Business
In the industry trade business, the Company benefits from purchasing and processing IC chips, LC
D screens, etc., which are raw materials in its traditional core business, from upstream suppliers and
selling them to downstream customers. The industry trade business can help the Company establish
good relationships with its upstream suppliers and downstream customers, and keep it informed of
prices of the materials used in its production for better cost control over its existing products.
Additionally, it is able to facilitate the development of the semiconductor business by helping
accumulate customer resources for the semiconductor and chip business, provide sales channels,
and achieve accurate matching of market demand, with a shortened product development period and
a lower risk of mismatching of R&D and market demand.
(III) The Environmental Protection Division
Currently, this business focuses on water treatment, recycling of renewable resources and the new
material of glass ceramic. Water engineering PPP (Public-Private Partnership) projects are
undertaken under BOT (Build-Operate-Transfer) or EPC (Energy Performance Contracting) models.
Renewable resources are collected, sorted, processed, distributed and sold.
(IV) The Semi-Conductor Division
Currently, the Company is engaged in storage, optoelectronics, etc. with respect to the
semi-conductor business. In storage, the Company primarily designs and markets master storage
chips, and engage in packaging and testing of storage products. In optoelectronics, the Company
primarily develops Micro LED-related products.
II Significant Changes in Major Assets
1. Significant Changes in Major Assets
Major
Main reason for significant changes
assets
Equity
No significant change
assets
Fixed
No significant change
assets
Intangible
No significant change
assets
Constructi
The ending amount increased 115.23% from the beginning amount, primarily driven by new environment
on in
engineering in progress.
progress
16
Konka Group Co., Ltd. Annual Report 2020
2. Major Assets Overseas
□ Applicable √ Not applicable
III Core Competitiveness Analysis
The Company’s core competitiveness lies in its R&D ability, brand, marketing network and human
resources. It has developed a three-level R&D system of “Konka Research Institute-Multimedia
R&D Centre-specialized design institutes”, established artificial intelligence internet of things
comprehensive laboratory and 5g Ultra HD laboratory with major universities or scientific research
institutions, established academician workstation, and built a technology research alliance matching
the industrial layout, with nearly 100 core key technologies and about 150 talents The company has
a R & D team of more than 20 people, and has introduced two projects of micro led and memory
master chip, with more than 100 industry technical talents. In terms of brand, the company
continues to promote brand strategy construction, system construction, image construction and
cultural construction, focuses on improving the scientific and international image of the enterprise,
strengthens the brand status, has a certain brand awareness and reputation in the consumer group,
and has good brand credit in banks and other financing channels. In terms of marketing channels,
the company innovates channel reform, cooperates online and offline for win-win results, and
strives for development at home and abroad. Offline channel, the company has more than 40
branches, more than 200 offices, more than 3000 after-sales service stores in all provinces and cities
of China, and the marketing and service network is all over the country; online channel, the
company has settled in tmall, Jingdong, Suning, vipshop and other mainstream e-commerce
platforms to innovate and develop live e-commerce business, and seek a new growth pole for
business development; overseas channel, the company The company's business covers Latin
America, Europe, Asia Pacific and other countries and regions, with a sound marketing network.
The company has many years of experience in senior management and executive team.
17
Konka Group Co., Ltd. Annual Report 2020
Part IV Operating Performance Discussion and Analysis
I Overview
In 2020, the Company continued to drive business development through technological innovation,
implement the development model of "Technology + Industry + Parks", and foster a development
strategy that aims to promote industrial businesses through technological innovation, incubate
industrial clusters through the core industrial businesses, drive regional development through the
industrial clusters, and nurture the technology and industrial businesses through regional
development-enabled resources, while pursuing the mission of developing the Company into an
innovation and technology-driven industrial group.
For 2020, the Company recorded operating revenue of RMB50.352 billion. Net profit attributable to
the Company as the parent stood at RMB478 million, representing a year-on-year rise of 125.26%.
What the Company has accomplished in 2020 is summarized as follows:
(I) Increased investment in innovation and achieved technological breakthroughs
In 2020, following the guiding principle of "independent innovation + technology acquisition," the
Company increased investment in R&D, focusing on semiconductor, AI (artificial intelligence) and
other sectors. The annual R&D investment was RMB684 million, up 36.57% year-on-year.
For the R&D system, the Company established technological research partnerships with notable
universities, technology enterprises and research institutions that match our industrial layout. This
initiative led to the establishment of several joint laboratories, including the AI IoT Comprehensive
Laboratory, 5G Ultra-High-Definition Laboratory, and Guangdong-Hong Kong Big Data Image and
Communication Application Joint Laboratory.
In terms of talent acquisition, the Company acquired a Micro-LED team of 269 people, attracted 18
doctoral and postdoctoral researchers to join us and partnered with a team of academicians to
establish an academician workstation.
In terms of R&D achievements, the Company realized the mass production and commercial launch
of memory master chips, and the Micro LED project successfully illuminated ultra-small chips
and successfully developed 7-inch flexible Micro LED displays. In addition, the programme led by
the Company the Research and Industrialization of the Next-generation Internet Intelligent Terminal
Key Technology won the Guangdong Provincial Second Prize for Progress in Science and
Technology in 2019, the programme Research and Industrialization of Key Quality Management
Technologies for Food in Refrigerators won the Third Prize of Anhui Provincial Award for Progress
in Science and Technology, and a patent titled Fuzzy Control Method for Rotating Speed of
Refrigerator Inverter Compressor won the Henan Provincial Award for Achievement in Science and
18
Konka Group Co., Ltd. Annual Report 2020
Technology.
(II) Industry fund system that enables the implementation of strategies was established
In 2020, the Company established an industry fund system to enable coordinated strategy
implementation and industrial development. The initiative has established a series of industry funds,
such as Yibin Kanghui Electronic Information Equity Investment Fund, Yancheng Kangyan
Information Industry Equity Investment Fund, Chongqing Kangxin Semiconductor Industry Equity
Investment Fund, Kunshan Xinjia Emerging Industries Equity Investment Fund and
Tongxiang-Wuzhen Jiayu Digital Economy Industry Fund.
(III) Business Operation Introduction
1. Industrial Product Division
(1) The Multimedia Sub-division
In 2020, focusing on reform and innovation, the Multimedia Sub-division continued to drive
organization optimization and implemented a series of organization restructuring, sales model
re-engineering, cost reduction, and efficiency improvement measures. Centering on the theme of
“building high-end brands, localizing overseas resources and diversifying manufacturing," the
sub-division implemented several operation optimization and management improvement projects
and significantly reduced operating costs, laying a foundation for further reform and continuous
operation upgrading.
(2) The White Goods Sub-division
In 2020, with the acquisition of Changzhou Beko's front loading washing machine production lines,
the White Goods Sub-division improved the overall strength of our washing machine product
businesses and enriched the portfolio of white goods products (refrigerators, washing machines, and
air conditioners) with upgraded development strategies. In addition, with the coordinated operation
of the Konka and Frestec brands, the Sub-division made further breakthroughs in brand building,
increased the production capacity for air conditioners, focused on strategies for creating hot-selling
products, and realized a growth in our white goods businesses.
(3) The Environmental Protection Sub-division
In 2020, the Environmental Protection Sub-division developed our environmental protection
businesses into a more systematic structure that centers on water and solid waste treatment,
renewable resources and new materials. Active efforts were also made for expansion into new
sectors, such as bio-organisms (Please confirm my translation or clarify the intended message.) and
chemical treatment of solid waste and exhaust gas.
(4) The Semiconductor Sub-division
In 2020, in the optoelectronics sector, the Company established R&D and production lines covering
the entire manufacturing process of Micro LED, realized small-batch pilot production runs,
complete the application for nearly 700 core patents, and launched small-pitch Micro LED
19
Konka Group Co., Ltd. Annual Report 2020
microcrystalline displays, flexible displays, 8K Micro LED commercial displays, Micro LED
watches and other products. In the storage field, the company independently designs the storage
master chip products to realize mass production and sales; secondly, the company has developed
nearly 45 embedded hardware and solid-state hard disk products and realized the marketing; in
addition, the company is actively promoting the implementation of the storage chip packaging test
base, and completing the layout in the "design + seal test + sales" link of the storage industry.
(5) The Mobile Internet Sub-division
In 2020, the Mobile Internet Sub-division defined communication technology as a core enabler,
focused on exploring the 5G IoT sector, and implemented the "1 (smart phone) + 3 (tablet computer,
wireless router and smart access control) + N (mobile communication accessories)" product
strategy.
(6) The PCB Sub-division
In 2020, the PCB Sub-division built Shenzhen Konka Circuit Co., Ltd. into a platform for unified
procurement and sales, thereby improving operations management efficiency. With the kick off of
the Suining Konka Circuit Industrial Park project, the "industry + park" mode achieved initial
success.
2. Technology Park Division
In 2020, continuing to pursue the "Technology + Industry + Parks" development mode, the
Company launched more than ten technology park projects -- including the upgraded old facility of
Dongguan Konka Electronic Co., Ltd., Konka Minghu K-Care Town, Yancheng Yangtze River
Delta Headquarters Base, Frestech Refrigeration Industrial Park and Smart Terminals Export and
Production Base -- and developed the new "Industry + Parks + Fund" expansion mode. At present,
while continuing to upgrade existing businesses through means of smart technologies and
improving the core competitiveness of the technology industry sector by taking advantage of the
industry clusters, the Technology Park Sub-division worked to optimize asset allocation through
equity transfer and other means and accelerate the turnover of capital, with the aim of further
nurturing the development of the technology industry sector.
3. Platform Service Division
(1) The Industry Trade Business
In 2020, the Industry Trade Sub-division actively promotes the transformation from trade to
industry, and continuously adjusts the business structure while continuously improving and
improving the risk control mode.
(2) The Internet Sub-division
In 2020, with stepped up efforts to enhance our products' basic functionalities, the Internet
Sub-division planned, developed, and commercially launched several major products, including
Douping, Yixue and Yihudong. With continuous efforts to upgrade our multi-scenario operation
20
Konka Group Co., Ltd. Annual Report 2020
mode, the Company recorded a continuous growth in advertisement businesses, OTT membership
revenue above RMB200 million and a growth of 55% in operating income from digital
entertainment businesses.
4. Financial Investment Division
(1) The Investment Sub-division
In 2020, the Company established several industry funds, including Yibin Kanghui Electronic
Information Equity Investment Fund, Yancheng Kangyan Information Industry Equity Investment
Fund, Chongqing Kangxin Semiconductor Industry Equity Investment Fund, Kunshan Xinjia
Emerging Industries Equity Investment Fund and Tongxiang-Wuzhen Jiayu Digital Economy
Industry Fund. These funds served well to support the implementation of strategies and
development of industrial businesses.
(2) The Venture Capital Investment Sub-division
In 2020, the Venture Capital Investment Sub-division completed the construction of a national
makerspace, which has attracted a batch of high-tech enterprises to participate.
II Core Business Analysis
(I) Overview
See “I Overview” above.
(II) Revenue and Cost Analysis
1. Breakdown of Operating Revenue
Unit: RMB
2020 2019
As % of total As % of total Change (%)
Operating revenue Operating revenue
operating revenue (%) operating revenue (%)
Total 50,351,836,554.87 100% 55,119,125,478.72 100% -8.65%
By operating division
Electronics 14,279,587,069.66 28.36% 14,746,927,518.74 26.75% -3.17%
Industry trade 30,483,602,365.87 60.54% 32,744,925,411.86 59.41% -6.91%
Environmental
4,823,779,902.39 9.58% 7,079,397,665.91 12.85% -31.86%
business
Semiconductor 282,969,230.63 0.56% ① - -
Other 481,897,986.32 0.96% 547,874,882.21 0.99% -12.04%
By product category
21
Konka Group Co., Ltd. Annual Report 2020
Color TVs 7,519,625,331.33 14.93% 8,765,607,417.92 15.90% -14.21%
White goods 3,842,051,456.02 7.63% 3,829,318,820.56 6.95% 0.33%
Industry trade 30,483,602,365.87 60.55% 32,744,925,411.86 59.41% -6.91%
Environmental
4,823,779,902.39 9.58% 7,079,397,665.91 12.84% -31.86%
business
Semiconductor 282,969,230.63 0.56% ② - -
Other 3,399,808,268.63 6.75% 2,699,876,162.47 4.90% 25.92%
By operating segment
Domestic 19,911,879,269.36 39.55% 20,324,715,174.80 36.87% -2.03%
Overseas 30,439,957,285.51 60.45% 34,794,410,303.92 63.13% -12.51%
①②the semiconductor business of the company is not accounted separately in 2019, so there is no comparable
data.
2. Operating Division, Product Category or Operating Segment Contributing over 10% of
Operating Revenue or Operating Profit
√ Applicable □ Not applicable
Unit: RMB
YoY change in YoY change in
Gross profit YoY change in
Operating revenue Cost of sales operating revenue gross profit
margin cost of sales (%)
(%) margin (%)
By operating division
Electronics 14,279,587,069.66 12,768,278,497.25 10.58% -3.17% -2.67% -0.46%
Industry
30,483,602,365.87 30,183,532,940.90 0.98% -6.91% -6.77% -0.14%
trade
Environme
ntal 4,823,779,902.39 4,097,138,754.02 15.06% -31.86% -35.77% 5.17%
business
By product category
Color TVs 7,519,625,331.33 6,925,658,808.00 7.90% -14.21% -13.49% -0.77%
Industry
30,483,602,365.87 30,183,532,940.90 0.98% -6.91% -6.77% -0.14%
trade
Environme
ntal 4,823,779,902.39 4,097,138,754.02 15.06% -31.86% -35.77% 5.17%
business
By operating segment
Domestic 19,911,879,269.36 17,538,443,668.86 11.92% -2.03% -1.51% -0.47%
22
Konka Group Co., Ltd. Annual Report 2020
Overseas 30,439,957,285.51 30,056,620,681.12 1.26% -12.51% -12.45% -0.07%
Core business data of the prior year restated according to the changed statistical caliber for the
Reporting Period:
□ Applicable √ Not applicable
3. Whether Revenue from Physical Sales Is Higher than Service Revenue
√ Yes □ No
Operating division Item Unit 2020 2019 Change (%)
Unit sales 0,000 units 1,269 1,434 -11.51%
Electronics Output 0,000 units 1,244 1,523 -18.32%
Inventory 0,000 units 89 105 -15.24%
Any over 30% YoY movements in the data above and why:
□ Applicable √ Not applicable
4. Execution Progress of Major Signed Sales Contracts in the Reporting Period
□ Applicable √ Not applicable
5. Breakdown of Cost of Sales
By product category
Unit: RMB
2020 2019
Product As % of total Change
Item As % of total
category Cost of sales cost of sales Cost of sales (%)
cost of sales (%)
(%)
Color TVs Color TVs 6,925,658,808.00 14.55% 8,005,508,211.90 15.35% -13.49%
White White
3,317,107,750.97 6.97% 3,299,314,084.65 6.33% 0.54%
goods goods
Industry Industry
30,183,532,940.90 63.42% 32,376,857,384.01 62.10% -6.77%
trade trade
Environment Environment
4,097,138,754.02 8.61% 6,379,216,880.51 12.24% -35.77%
al business al business
Semiconduct Semiconduct
275,286,437.09 0.58% ③ - -
or or
Other Other 2,796,339,659.00 5.87% 2,077,301,939.97 3.98% 34.61%
③The company did not conduct separate accounting for semiconductor business in 2019, so there is no
comparable data.
Note:
Cost of sales changed accordingly with operating revenue.
6. Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
23
Konka Group Co., Ltd. Annual Report 2020
Unit: RMB
The Company’s
Name of subsidiary Registered capital Date of change Reason for change
interest (%)
Boxing Xingkang Environmental Technology
100,000,000.00 35.70% 2020-11-19 De-registered
Co., Ltd.
Anhui Konka Debao New Material
5,000,000.00 60.00% 2020-12-7 De-registered
Technology Co., Ltd.
Kanghong (Yantai) Environmental Technology
10,000,000.00 51.00% 2020-9-29 De-registered
Park Co., Ltd.
Hubei Kangxinlong Environmental Protection
30,000,000.00 51.00% 2020-12-8 De-registered
Co., Ltd.
Shenzhen Konka Kangxin Technology Co.,
10,000,000.00 51.00% 2020-11-20 De-registered
Ltd.
Henan Frestec Smart Eco Electrical
10,000,000.00 51.00% 2020-9-27 De-registered
Appliances Co., Ltd.
Yuekang Semiconductor Technology (Yantai)
100,000,000.00 100.00% 2020-2-24 De-registered
Co., Ltd.
Sichuan Konka Industrial New Town
100,000,000.00 51.00% 2020-12-8 De-registered
Development Co., Ltd.
Hainan Konka Technology Industry
100,000,000.00 51.00% 2020-11-17 De-registered
Development Co., Ltd.
Guizhou Konka Enterprise Management
5,000,000.00 51.00% 2020-8-26 De-registered
Service Co., Ltd.
Nanjing Konka Smart Technology Co., Ltd. 50,000,000.00 100.00% 2020-11-17 De-registered
Shandong Kangxin Industrial Development
100,000,000.00 51.00% 2020-12-24 De-registered
Co., Ltd.
Shenzhen Konka Commercial System
12,000,000.00 81.00% 2020-12-7 De-registered
Technology Co., Ltd.
Shenzhen Konka Life Electric Appliance Co.,
42,000,000.00 75.00% 2020-12-10 De-registered
Ltd.
Yantai Konka Industrial Co., Ltd. 100,000,000.00 89.71% 2020-12-31 De-registered
Youshi Kangrong Culture Communication
70,000,000.00 70.00% 2020-7-1 De-registered
Co., Ltd.
Weifang Sikang Investment Operation Co.,
150,000,000.00 32.8338% 2020-3-25 De-registered
Ltd.
Zhongshan Kangxin Electronic Technology
1,000,000.00 51.00% 2020-12-4 De-registered
Co., Ltd.
24
Konka Group Co., Ltd. Annual Report 2020
Kangshi Virtual Technology (Yantai) Co., Ltd. 100,000,000.00 100.00% 2020-12-28 De-registered
Suining Konka Smart Technology Co., Ltd. 100,000,000.00 100.00% 2020-12-21 Newly incorporated
Henan Frestec Smart Home Technology Co.,
50,000,000.00 51.00% 2020-8-26 Newly incorporated
Ltd.
Jiangsu Konka Smart Electrical Appliances
120,000,000.00 51.00% 2020-9-11 Newly incorporated
Co., Ltd.
Kangshi Virtual Technology (Yantai) Co., Ltd. 100,000,000.00 100.00% 2020-9-21 Newly incorporated
Zhongshan Kangxin Electronic Technology
1,000,000.00 51.00% 2020-6-9 Newly incorporated
Co., Ltd.
Zhongshan Kang’ao Electronic Co., Ltd. 43,500,000.00 51.00% 2020-9-3 Newly incorporated
Liaoyang Kangshun Smart Technology Co.,
10,000,000.00 100.00% 2020-5-9 Newly incorporated
Ltd.
Liaoyang Kangshun Renewable Energy Co.,
50,000,000.00 100.00% 2020-9-10 Newly incorporated
Ltd.
Nanjing Konka Electronics Co., Ltd. 10,000,000.00 100.00% 2020-6-18 Newly incorporated
Gaoping Kangrun Environmental Protection &
100,000,000.00 48.45% 2020-5-29 Newly incorporated
Water Co., Ltd.
Mengcheng Kangrun Anjian Water Co., Ltd. 100,000,000.00 43.35% 2020-6-19 Newly incorporated
Xixian Kangrun Xijian Water Environment
163,780,500.00 26.01% 2020-4-16 Newly incorporated
Development Co., Ltd.
Chongzhou Kangrun Environment Co., Ltd. 50,000,000.00 42.67% 2020-8-28 Newly incorporated
Xi’an Gaoling Kangrun Environmental
73,710,000.00 48.45% 2020-8-28 Newly incorporated
Engineering Co., Ltd.
Ankang Kangrun Xinheng Water Environment
100,000,000.00 26.01% 2020-9-10 Newly incorporated
Co., Ltd.
Linfen Kangrun Jinze Water Supply Co., Ltd. 95,000,000.00 39.24% 2020-12-30 Newly incorporated
Changning Kangrun Water Co., Ltd. 50,000,000.00 45.89% 2020-10-19 Newly incorporated
Bokang Renewable Resources (Yantai) Co.,
30,000,000.00 26.01% 2020-12-28 Acquired
Ltd.
Jiangsu Konka Special Material Technology
100,000,000.00 51.00% 2020-12-24 Newly incorporated
Co., Ltd.
Chongqing Kangxingrui Scraped Automobile
100,000,000.00 51.00% 2020-4-17 Newly incorporated
Recycling Co., Ltd.
Konka Xinyun Semiconductor Technology
100,000,000.00 56.00% 2020-4-17 Newly incorporated
(Yancheng) Co., Ltd.
Yantai Kangyun Property Development Co., 10,000,000.00 51.00% 2020-11-27 Newly incorporated
25
Konka Group Co., Ltd. Annual Report 2020
Ltd.
Chongqing Kanglei Optoelectronic
50,000,000.00 51.00% 2020-2-27 Newly incorporated
Technology Co., Ltd.
Yibin Kangrun Environmental Technology
100,000,000.00 83.83% 2020-4-21 Newly incorporated
Co., Ltd.
Henan Kangxin Property Co., Ltd. 50,000,000.00 51.00% 2020-8-24 Newly incorporated
Shenzhen Kangxin Property Co., Ltd. 50,000,000.00 51.00% 2020-12-21 Newly incorporated
Henan Kanghan Property Co., Ltd. 50,000,000.00 51.00% 2020-12-28 Newly incorporated
Chongqing Chengda Property Co., Ltd. 50,000,000.00 51.00% 2020-9-14 Newly incorporated
Chongqing Chunfu Property Co., Ltd. 50,000,000.00 51.00% 2020-9-21 Newly incorporated
Chongqing Langheng Property Co., Ltd. 50,000,000.00 51.00% 2020-9-23 Newly incorporated
Chongqing Chengda Property Co., Ltd. 50,000,000.00 33.00% 2020-12-24 Losing control power
Chongqing Chunfu Property Co., Ltd. 50,000,000.00 33.00% 2020-12-24 Losing control power
Chongqing Langheng Property Co., Ltd. 50,000,000.00 33.00% 2020-12-24 Losing control power
Morsemi Semiconductor Technology (Hong
HKD10,000.00 30.00% 2020-9-21 Losing control power
Kong) Limited
Chuzhou Kangxin Health Industry
30,000,000.00 49.00% 2020-12-21 Losing control power
Development Co., Ltd.
Dongguan Konka Investment Co., Ltd. 100,000,000.00 49.00% 2020-9-25 Losing control power
Chongqing Zhengmao Semiconductor Co.,
10,000,000.00 30.00% 2020-9-21 Losing control power
Ltd.
Chongqing Konka Fuze Property Co., Ltd. 50,000,000.00 33.00% 2020-11-25 Losing control power
Chongqing Konka Xingyi Property Co., Ltd. 50,000,000.00 33.00% 2020-11-25 Losing control power
Chongqing Konka Property Development Co.,
50,000,000.00 33.00% 2020-11-25 Losing control power
Ltd.
Chengdu Konka Incubator Management Co.,
5,000,000.00 15.30% 2020-12-21 Losing control power
Ltd.
Shenzhen Konka Cross-Border Technological
1,000,000.00 15.30% 2020-12-22 Losing control power
Innovation Service Co., Ltd.
Shenzhen Morsemi Semiconductor
10,000,000.00 30.00% 2020-9-21 Losing control power
Technology Co., Ltd.
Shenzhen Konka Yifang Technology Co., Ltd. 10,000,000.00 40.00% 2020-6-11 Losing control power
E3info (Hainan) Technology Co., Ltd. 20,000,000.00 40.00% 2020-6-11 Losing control power
Zhongshan Kang’ao Electronic Co., Ltd. 43,500,000.00 0.00% 2020-12-24 Losing control power
26
Konka Group Co., Ltd. Annual Report 2020
7. Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable √ Not applicable
8. Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB) 21,341,550,423.86
Total sales to top five customers as % of total sales of the 42.38%
Reporting Period (%)
Total sales to related parties among top five customers as % 0.00%
of total sales of the Reporting Period (%)
Top five customers:
Sales revenue contributed
No. Customer for the Reporting Period As % of total sales revenue (%)
(RMB)
1 Customer A 7,088,945,710.19 14.08%
2 Customer B 5,732,788,382.07 11.39%
3 Customer C 5,039,393,889.26 10.01%
4 Customer D 1,952,295,474.93 3.88%
5 Customer E 1,528,126,967.40 3.03%
Total -- 21,341,550,423.86 42.38%
Other information about major customers:
√ Applicable □ Not applicable
None of the top five customers were related parties of the Company. And none of the Company’s
directors, supervisors, executive officers, core technicians, over 5% shareholders, actual controller
or any other related parties held equity interests in the major customers, directly or indirectly.
Major suppliers:
Total purchases from top five suppliers (RMB) 21,908,733,213.06
Total purchases from top five suppliers as % of total purchases of 46.71%
the Reporting Period (%)
Total purchases from related parties among top five suppliers 0.00%
as % of total purchases of the Reporting Period (%)
Top five suppliers:
Purchase in the Reporting
No. Supplier As % of total purchases (%)
Period (RMB)
1 Supplier A 7,868,804,100.18 16.78%
2 Supplier B 6,855,261,976.07 14.61%
3 Supplier C 3,031,001,228.37 6.46%
27
Konka Group Co., Ltd. Annual Report 2020
4 Supplier D 2,505,747,474.44 5.34%
5 Supplier E 1,647,918,434.00 3.52%
Total -- 21,908,733,213.06 46.71%
Other information about major suppliers:
√ Applicable □ Not applicable
None of the top five customers were related parties of the Company. And none of the Company’s
directors, supervisors, executive officers, core technicians, over 5% shareholders, actual controller
or any other related parties held equity interests in the major customers, directly or indirectly.
(III) Expense
Unit: RMB
2020 2019 Change (%) Reason for any significant change
Selling
1,825,626,804.27 2,303,132,732.06 -20.73%
expense
Administr
ative 1,022,981,943.34 856,529,327.62 19.43%
expense
Finance
1,091,609,967.76 775,888,813.14 40.69% Greater fluctuations in exchange rates in the year
costs
R&D
681,878,611.65 500,600,102.23 36.21% Continuous increase in R&D investments
expense
(IV) R&D Investments
√ Applicable □ Not applicable
Within the Reporting Period, the Company invested RMB684 million as the R&D Investment,
realizing a year-on-year growth of 36.57%. The programmes led by the Company the Research and
Industrialization of the Next-generation Internet Intelligent Terminal Key Technology, Fuzzy
Control Method for Rotating Speed of Refrigerator Inverter Compressor and the Research and
Industrialization of Key Quality Management Technologies for Food in Refrigerators won the
Guangdong Provincial Second Prize for Progress in Science and Technology, Henan Award for
Achievement in Science and Technology, and the Third Prize of Henan Provincial Award for
Progress in Science and Technology, respectively. The 5G+8K multimodal live streaming system
developed by the Company was one of the five winners of the Product Excellence Award of the
Global 5G Application Competition (held in Shenzhen, China). The Company used the technology
to support the Xinhua News Agency for 5G+8K+satellite live report of the 2020 annual sessions of
the CPC and CPPCC. Public financial support was granted to three research projects, which were
applied by the Company independently or jointly -- the Guangdong-Hong Kong Big Data Image
and Communication Application Joint Laboratory project approved by the 2020 Guangdong Special
Fund for Science and Technology Innovation Strategy, the Development of MiniLED Backlights for
28
Konka Group Co., Ltd. Annual Report 2020
High-Performance Displays project approved as a Special Project of the Open Competition category
by the 2020 Anhui Fund for Major and Special Science and Technology Projects and the Shenzhen
Research Center of Smart Integrated Displays Engineering Technology project approved as a 2021
project by Shenzhen Engineering Technology Research Center, Shenzhen Science and Technology
Innovation Commission. While the Company was continuously improving the core competitiveness,
it continued corresponding technical innovation and various proposals for rationalization so as to
increase the production efficiency and enhance the core competitiveness.
Details about R&D investments:
2020 2019 Change (%)
Number of R&D personnel 1504 1,494 0.67%
R&D personnel as % of total employees 8.74% 7.75% 0.99%
R&D investments (RMB) 681,878,611.65 500,600,102.23 36.57%
R&D investments as % of operating
1.36% 0.91% 0.45%
revenue
Capitalized R&D investments (RMB) 1,811,835.62 0
Capitalized R&D investments as % of
0.27% 0% 0.27%
total R&D investments
Reasons for any significant YoY change in the percentage of R&D investments in operating
revenue:
□ Applicable √ Not applicable
Reason for any sharp variation in the percentage of capitalized R&D investments and rationale:
□ Applicable √ Not applicable
(V) Cash Flows
Unit: RMB
Item 2020 2019 Change (%)
Subtotal of cash generated from
52,043,626,482.73 59,732,534,490.78 -12.85%
operating activities
Subtotal of cash used in operating
51,865,009,954.52 61,276,481,775.37 -15.34%
activities
Net cash generated from/used in
178,616,528.21 -1,543,947,284.59 111.57%
operating activities
Subtotal of cash generated from
4,798,350,613.92 2,952,154,902.91 62.54%
investing activities
Subtotal of cash used in investing
7,250,899,403.98 6,814,764,242.49 6.40%
activities
Net cash generated from/used in
-2,452,548,790.06 -3,862,609,339.58 36.51%
investing activities
Subtotal of cash generated from
22,866,838,295.94 32,403,367,267.48 -29.43%
financing activities
29
Konka Group Co., Ltd. Annual Report 2020
Subtotal of cash used in financing
20,731,825,242.51 25,938,350,195.40 -20.07%
activities
Net cash generated from/used in
2,135,013,053.43 6,465,017,072.08 -66.98%
financing activities
Net increase in cash and cash
-195,645,803.98 1,059,552,435.50 -118.46%
equivalents
Explanation of why any of the data above varies significantly:
√ Applicable □ Not applicable
Net cash generated from/used in financing activities changed primarily because there was an issue
of corporate bonds of RMB5 billion last year, with no comparable events in the Reporting Period.
Net cash generated from/used in financing activities changed primarily due to during the reporting
period, the company's inventory turnover accelerated, the amount of inventory decreased, and the
amount of advance receipts increased year on year.
Reason for any big difference between the net operating cash flow and the net profit for this
Reporting Period: the increase in cash deposits that cannot be withdrawn at any time.
□ Applicable √ Not applicable
III Analysis of Non-Core Businesses
√ Applicable □ Not applicable
Unit: RMB
As % of total
Amount Source/Reason Exceptional or recurrent
profit
Return on Income from transfer of
2,433,336,004.85 484.86% Exceptional
investment equity interests
Gain/loss on
changes in fair 19,089,541.66 3.80% Exceptional
value
Impairment loss
Asset impairments -462,407,098.47 -92.14% Exceptional
allowances
Tax rebates of software is
Non-operating
87,126,795.41 17.36% recurrent and others are
income
uncertain
Non-operating
25,590,474.86 5.10% Exceptional
expense
30
Konka Group Co., Ltd. Annual Report 2020
IV Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Indicate by tick mark whether the Company has adopted the new accounting standards governing
revenue and leases since 2020 and restated the beginning amounts of relevant financial statement
line items in the year.
√ Applicable □ Not applicable
Unit: RMB
31 December 2020 1 January 2020
Change in Reason for any
As % of As % of
percentage significant
Amount total Amount total
(%) change
assets assets
Monetary
5,431,530,180.90 10.89% 6,599,360,051.61 15.49% -4.60%
assets
Accounts
3,900,897,623.59 7.82% 3,804,339,643.15 8.93% -1.11%
receivable
Inventories 4,521,300,677.41 9.07% 5,307,497,440.88 12.46% -3.39%
Investment
538,585,668.29 1.08% 400,197,374.07 0.94% 0.14%
property
Long-term
equity 4,375,833,584.65 8.77% 3,465,541,196.89 8.13% 0.64%
investments
Fixed assets 3,178,642,017.84 6.37% 2,561,254,191.55 6.01% 0.36%
Construction in
9,236,643,931.68 18.52% 4,291,544,368.52 10.07% 8.45%
progress
Short-term
10,990,550,475.78 22.04% 10,332,687,239.63 24.25% -2.21%
borrowings
Long-term
5,964,748,997.54 11.96% 4,890,315,729.90 11.48% 0.48%
borrowings
2. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Impa
irme Ot
Gain/loss on Cumulative
nt her
fair-value fair-value Purchased in Sold in the
Beginning allow ch
Item changes in the changes the Reporting Reporting Ending amount
amount ance an
Reporting charged to Period Period
for ge
Period equity
the s
Repo
31
Konka Group Co., Ltd. Annual Report 2020
rting
Perio
d
Financial assets
1. Trading financial
assets (derivative
61,494,666.97 19,089,541.66 599,160,000.00 61,494,666.97 618,249,541.66
financial assets
excluded)
4. Other equity
21,642,170.36 -98,878.20 -98,878.20 5,000,001.00 1,200,000.00 25,343,293.16
instrument investment
Subtotal of financial
83,136,837.33 18,990,663.46 -98,878.20 604,160,001.00 62,694,666.97 643,592,834.82
assets
Other 1,896,295,999.65 -244,596.77 209,334,863.14 143,174,271.82 1,962,211,994.20
Total of the above 1,979,432,836.98 18,746,066.69 -98,878.20 813,494,864.14 205,868,938.79 2,605,804,829.02
Financial liabilities 0 0
Particulars about other changes:
Gain/loss on Cumulative
Impairment
fair-value fair-value Purchased in Sold in the Other
Beginning allowance for
Item changes in the changes the Reporting Reporting chang Ending amount
amount the Reporting
Reporting charged to Period Period es
Period
Period equity
1,896,295,999.65 -244,596.77 209,334,863.1 143,174,271.8 - 1,962,211,994.20
Other ：
4 2
Other non-current 1,753,121,727.83 -244,596.77 125,277,665.7 1,878,154,796.76
financial assets 0
143,174,271.82 84,057,197.44 143,174,271.8 84,057,197.44
Receivables financing
2
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
3. Restricted Asset Rights as at the Period-End
Ending carrying
Item Reason for restriction
value (RMB)
RMB1,067,872,557.16 was security deposits as pledge for borrowing or for bank
acceptance notes; RMB37,701,403.94 was deposited in the financial regulation
Monetary assets 1,133,474,067.66
account; RMB20,903,555.17 was term deposits with no early withdrawal allowed;
and RMB6,996,551.39 was restricted for other reasons.
Trading financial assets 618,249,541.66 Structural deposits are used to pledge loans。
32
Konka Group Co., Ltd. Annual Report 2020
Bank acceptance notes in the carrying amount of RMB784,932,739.73 were put in
Notes receivable 784,732,739.73 pledge for comprehensive financing with respect to bank acceptance notes, letters of
credit, letters of guarantee, trade financing, paper pools, etc.
Investment property 131,321,568.34 As collaterals for guarantees
Fixed assets 768,741,766.12 For mortgage loan, finance lease and guarantee
Construction in progress 328,756,028.19 As collaterals for guarantees
Intangible assets 191,106,846.79 For mortgage loan, finance lease and guarantee
Long-term receivables 351,107,041.45 As collaterals for guarantees
Total 4,307,489,599.94
V Investments Made
1. Total Investment Amount
√ Applicable □ Not applicable
Amount of the same period of last year
Amount of Reporting Period (RMB) Change (%)
(RMB)
5,893,962,083.15 1,357,746,303.50 334.10%
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
√ Applicable □ Not applicable
Unit: RMB
E reason
s
t for not
i
m meeting
P
a
r Accumul the Disclos
t
Inve Fixed o ative Disclosure
Indu Accumulative Capit e
stme assets Input amount in g realized schedul ure
stry actual input al d
Item nt invest the Reporting r revenues date (if
invol amount as of the resou e and index (if
meth ment Period e as of the
ved period-end rces r any)
od or not s period-en
e expecte any)
s d
v
e d
n
u revenue
e
s s
Dongguan Elect
Self-
Konka Self- ronic 11 March
Yes 15,455,030.00 219,020,000.00 fund N/A http://w
Intelligent build indu 2017
ed ww.cnin
Industrial Park stry
fo.com.
Yibin Konka Elect
Self- 16 cn/new/i
Intelligent Self- ronic
Yes 70,980,707.03 164,056,542.25 fund N/A December ndex
Terminal build indu
ed 2017
High-Tech stry
33
Konka Group Co., Ltd. Annual Report 2020
Park
Suining Konka Elect
Self- 17
Electronic Self- ronic
Yes 122,463,664.30 185,785,142.07 fund N/A October
Technology build indu
ed 2018
Industrial Park stry
Konka
Chuzhou Elect
Self- 25
Smart Self- ronic
Yes 290,409,075.00 483,201,475.00 fund N/A December
Appliances and build indu
ed 2018
Equipment stry
Industrial Park
Chongqing
Elect
Konka Self-
Self- ronic 14 June
Semiconductor Yes 36,672,823.47 103,442,487.27 fund N/A
build indu 2019
Photoelectric ed
stry
Industrial Park
Envi
ron
Guxian
ment
Environmental Self- 26
Self- al
Protection Yes 666,557,122.23 666,557,122.23 fund N/A November
build prote
Technology ed 2019
ction
Town
indu
stry
Yancheng Elect
Self- 26
Semiconductor Self- ronic
Yes 800,664.00 800,664.00 fund N/A November
Assembly & build indu
ed 2019
Test Base stry
Konka
Intelligent Elect
Self-
Terminal Self- ronic 6 June
Yes 8,239,200.00 8,239,200.00 fund N/A
Manufacturing build indu 2020
ed
Base for stry
Export
Elect
Frestec Self-
Self- ronic 21 July
Refrigeration Yes 96,683,675.61 96,683,675.61 fund N/A
build indu 2020
Park ed
stry
Total -- -- -- 1,308,261,961.64 1,927,786,308.43 -- - - -- -- --
Note: Yibin Konka Intelligent Terminal High-Tech Park has been completed and is currently
bringing in business. With respect to Dongguan Konka Intelligent Industrial Park, Konka Chuzhou
34
Konka Group Co., Ltd. Annual Report 2020
Smart Appliances and Equipment Industrial Park, Chongqing Konka Semiconductor Photoelectric
Industrial Park, Suining Konka Electronic Technology Industrial Park, and Frestec Refrigeration
Park, the land has been obtained for the projects and they are now under construction. As for
Guxian Environmental Protection Technology Town, the land has been obtained for the project and
it is waiting for construction.The main body of Yancheng Semiconductor Assembly & Test Base
was put in place, and interior decoration and equipment purchase are ongoing. Konka Intelligent
Terminal Manufacturing Base for Export has started production as scheduled.
4. Financial Investments
(1) Securities Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
5. Use of Funds Raised
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VI Sale of Major Assets and Equity Interests
1. Sale of Major Assets
√ Applicable □ Not applicable
(1) Transfer of some of the cloud big data operation-related patents: On 23 June 2020, the 29th
session of the ninth Board of Directors of the Company reviewed and approved the Proposal on the
Transfer of Some of the Could Big Data-Related Patents, which allows the Company to transfer 68
could big data operation-related patents to Shenzhen Konka Holdings Group Co., Ltd. at a price of
RMB98.60 million. At present, the Company has received the payment for the transfer of these
patents from Shenzhen Konka Holdings Group Co., Ltd., which has been registered at the
competent authority as the new owner of these patents.
(2) Transfer of some of the IoT, smart healthcare, and UHD display terminal-related patents: On 17
July and 10 August 2020, the 30th session of the ninth Board of Directors and the second
extraordinary general meeting 2020 reviewed and approved the Proposal on the Transfer of Some of
the IoT, Smart Healthcare and UHD Display-Related Patents, which allows the Company to transfer
67 could big data operation-related patents to Shenzhen Konka Holdings Group Co., Ltd. at a price
of RMB89.60 million. At present, the Company has received the payment for the transfer of these
patents from Shenzhen Konka Holdings Group Co., Ltd., which has been registered at the
competent authority as the new owner of these patents.
Title of public announcement Disclosure date Disclosure website
35
Konka Group Co., Ltd. Annual Report 2020
Announcement on the Transfer of Some of the Cloud Big Data Operation-Related Patents
24 June 2020
and the Related-Party Transaction http://www.cninfo.com.c
Announcement on the Transfer of Some of the IoT, K-care and Ultra-High-Definition n/new/index
21 July 2020
Display Terminal-Related Patents and the Related-Party Transaction
2. Sale of Major Equity Interests
√ Applicable □ Not applicable
Amount Amount
contributed contribute
by the d by the Relati
Rel
equity sale to net onship
ated Inde
interests to Effect income of betwe Owner Executed as
Pric -par x to
Selling net income of the the en ship scheduled or Disc
Equity ing ty discl
Counte Date price of the sale Company counte fully not, if not, losu
interests prin tran osed
rparty of sale (RMB’ Company on the as a rparty transfe state reason re
sold cipl sact infor
0,000) from Comp percentage and rred or and actions date
e ion mati
period-begi any of the the not taken
or on
nning to Company’ Comp
not
date of sale s net any
(RMB’0,0 income
00) (%)
34%
equity of
Shenzh
Nanjing
en
K-Star Ass The
Konka Opti 6
Technolog 28 esse same
Holdin 47,098. mizin June
ical June 0 68.88% d Yes actual Yes Yes
gs 65 g the 202
Industrial 2020 valu contr
Group Comp 0
Park e oller
Co., any’s
http://
Manageme
Ltd. alloca
www.
nt Co.,
tion
cninf
Ltd.
of
o.co
Shenzhe assets
51% equity m.cn/
n , Ass
of 18 new/i
Yuhong increa esse 21
Dongguan Septem ndex
Rongji 58,650 -712.61 sing 245.26% d No No Yes Yes July
Konka ber
Investm capita valu 2020
Investment 2020
ent Co., l e
Co., Ltd.
Ltd. liquid
ity
Dangdai 18% equity 25 Asse 16
Green of Novem ssed Septe
2,700 -0.13 9.95% No No Yes Yes
Property Chongqing ber valu mber
(Xi’an) Konka 2020 e 2020
36
Konka Group Co., Ltd. Annual Report 2020
Co., Ltd. Property
Developmen
t Co., Ltd.
Yuefei 51% equity
Real of Chuzhou
21 Asse 24
Estate Kangxin
Decem ssed Octo
Develop Health 19,482 0.44 64.30% No No Yes Yes
ber valu ber
ment Industrial
2020 e 2020
(Yichun) Developmen
Co., Ltd. t Co., Ltd.
VII Major Subsidiaries
√ Applicable □ Not applicable
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10%
effect on the Company’s net profit
Unit: RMB
Rel
atio
nshi
p
Principal Register
wit Total Operating Operating
Name activity ed Net assets Net profit
h assets revenue profit
capital
the
Co
mp
any
Shandong Econ 352,051,340.40 320,737,166.02
Sub Public
Technology RMB164, 13,217,858, 1,552,101,3 3,272,636,8
sidi service-water
Co., Ltd. 000,000 947.58 80.37 35.33
ary management
(Consolidated)
Shenzhen 71,219,856.76 56,209,537.09
Wankaida Sub Software design
RMB10,0 90,053,235. 86,907,070. 73,355,880.
Science and sidi and technology
00,000 21 90 00
Technology ary development
Co., Ltd.
Chain Kingdom 37,006,046.48 31,266,708.21
Sub
Memory USD1,500 1,223,448,7 127,984,61 8,261,027,3
sidi Industry trade
Technologies ,000 77.49 8.61 64.98
ary
Co., Limited
37
Konka Group Co., Ltd. Annual Report 2020
Export & 135,566,078.28 121,559,146.43
Sub import of 2,692,913,9 241,589,03 4,058,498,2
Hong Kong HKD500,
sidi electromechanic 48.54 6.07 51.38
Konka Co., Ltd. 000
ary al and
electronics
Konka - 70,406,707.51 65,434,592.80
Electrical 529,465,237 132,791,28
Sub
Appliances Investment HKD500, .62 8.95
sidi
Investment & platform 000
ary
Development
Co., Ltd.
Konka Export & 43,956,192.18 43,956,192.18
Electrical Sub import of 1,262,482,9 -104,295,23 1,365,097,5
Appliances HKD500,
sidi electromechanic 40.82 6.62 12.51
International 000
ary al and
Trading Co.,
Ltd. electronics
Subsidiaries obtained or disposed in the Reporting Period:
√ Applicable □ Not applicable
How subsidiary was obtained or Effects on overall operations and
Subsidiary
disposed in the Reporting Period operating performance
Boxing Xingkang Environmental Technology Co.,
De-registered
Ltd.
Anhui Konka Debao New Material Technology Co.,
De-registered
Ltd.
Kanghong (Yantai) Environmental Technology Park
De-registered
Co., Ltd.
Hubei Kangxinlong Environmental Protection Co.,
De-registered
Ltd.
Shenzhen Konka Kangxin Technology Co., Ltd. De-registered
Henan Frestec Smart Eco Electrical Appliances Co., Better allocation of assets
De-registered
Ltd.
Yuekang Semiconductor Technology (Yantai) Co.,
De-registered
Ltd.
Sichuan Konka Industrial New Town Development
De-registered
Co., Ltd.
Hainan Konka Technology Industry Development Co.,
De-registered
Ltd.
Guizhou Konka Enterprise Management Service Co.,
De-registered
Ltd.
38
Konka Group Co., Ltd. Annual Report 2020
Nanjing Konka Smart Technology Co., Ltd. De-registered
Shandong Kangxin Industrial Development Co., Ltd. De-registered
Shenzhen Konka Commercial System Technology
De-registered
Co., Ltd.
Shenzhen Konka Life Electric Appliance Co., Ltd. De-registered
Yantai Konka Industrial Co., Ltd. De-registered
Youshi Kangrong Culture Communication Co., Ltd. De-registered
Weifang Sikang Investment Operation Co., Ltd. De-registered
Zhongshan Kangxin Electronic Technology Co., Ltd. De-registered
Kangshi Virtual Technology (Yantai) Co., Ltd. De-registered
Suining Konka Smart Technology Co., Ltd. Newly incorporated
Henan Frestec Smart Home Technology Co., Ltd. Newly incorporated
Jiangsu Konka Smart Electrical Appliances Co., Ltd. Newly incorporated
Kangshi Virtual Technology (Yantai) Co., Ltd. Newly incorporated
Zhongshan Kangxin Electronic Technology Co., Ltd. Newly incorporated
Zhongshan Kang’ao Electronic Co., Ltd. Newly incorporated
Liaoyang Kangshun Smart Technology Co., Ltd. Newly incorporated
Liaoyang Kangshun Renewable Energy Co., Ltd. Newly incorporated
Nanjing Konka Electronics Co., Ltd. Newly incorporated
Gaoping Kangrun Environmental Protection & Water
Newly incorporated
Co., Ltd.
Mengcheng Kangrun Anjian Water Co., Ltd. Newly incorporated
Xixian Kangrun Xijian Water Environment Beneficial to the development of
Newly incorporated the Company’s relevant business
Development Co., Ltd.
Chongzhou Kangrun Environment Co., Ltd. Newly incorporated
Xi’an Gaoling Kangrun Environmental Engineering
Newly incorporated
Co., Ltd.
Ankang Kangrun Xinheng Water Environment Co.,
Newly incorporated
Ltd.
Linfen Kangrun Jinze Water Supply Co., Ltd. Newly incorporated
Changning Kangrun Water Co., Ltd. Newly incorporated
Bokang Renewable Resources (Yantai) Co., Ltd. Acquired
Jiangsu Konka Special Material Technology Co., Ltd. Newly incorporated
Chongqing Kangxingrui Scraped Automobile
Newly incorporated
Recycling Co., Ltd.
Konka Xinyun Semiconductor Technology Newly incorporated
39
Konka Group Co., Ltd. Annual Report 2020
(Yancheng) Co., Ltd.
Yantai Kangyun Property Development Co., Ltd. Newly incorporated
Chongqing Kanglei Optoelectronic Technology Co.,
Newly incorporated
Ltd.
Yibin Kangrun Environmental Technology Co., Ltd. Newly incorporated
Henan Kangxin Property Co., Ltd. Newly incorporated
Shenzhen Kangxin Property Co., Ltd. Newly incorporated
Henan Kanghan Property Co., Ltd. Newly incorporated
Chongqing Chengda Property Co., Ltd. Newly incorporated
Chongqing Chunfu Property Co., Ltd. Newly incorporated
Chongqing Langheng Property Co., Ltd. Newly incorporated
Chongqing Chengda Property Co., Ltd. Equity transfer
Chongqing Chunfu Property Co., Ltd. Equity transfer
Chongqing Langheng Property Co., Ltd. Equity transfer
Morsemi Semiconductor Technology (Hong Kong)
Equity transfer
Limited
Chuzhou Kangxin Health Industry Development Co.,
Equity transfer
Ltd.
Dongguan Konka Investment Co., Ltd. Equity transfer
Chongqing Zhengmao Semiconductor Co., Ltd. Equity transfer
Beneficial to the development of
Chongqing Konka Fuze Property Co., Ltd. Equity transfer the Company’s relevant business
Chongqing Konka Xingyi Property Co., Ltd. Equity transfer and bring about a certain amount
of gains
Chongqing Konka Property Development Co., Ltd. Equity transfer
Chengdu Konka Incubator Management Co., Ltd. Equity transfer
Shenzhen Konka Cross-Border Technological
Equity transfer
Innovation Service Co., Ltd.
Shenzhen Morsemi Semiconductor Technology Co.,
Equity transfer
Ltd.
Shenzhen Konka Yifang Technology Co., Ltd. Equity transfer
E3info (Hainan) Technology Co., Ltd. Equity transfer
Zhongshan Kang’ao Electronic Co., Ltd. Equity transfer
Information about major majority- and minority-owned subsidiaries:
None
VIII Structured Bodies Controlled by the Company
□ Applicable √ Not applicable
40
Konka Group Co., Ltd. Annual Report 2020
IX. Prospect of the Company’s Future Development
In 2021, the Company will firmly implement the "Technology + Industry + Park" development
strategy, and drive high-quality development of the Company.
The Company’s work plan for 2021 is as follows:
(I) To continue to increase investment in R&D and drive science and technology innovation
In 2021, the Company will continue to increase investment in R&D, focusing on core technologies
in the semiconductor sector and targeting to realize breakthroughs in chip, mass transfer and other
core technologies and commercial application and industrialization of Micro LED. In addition, the
Company will continuously improve our strategic layout of intellectual property rights, strengthen
our technological advantages in 5G, 8K, IoT, Micro LED, semiconductor memory and other areas
and make substantive efforts to transform "Konka Electronics" into "Konka Technology."
(II) To step up efforts to improve product quality
As a product manufacturing enterprise, the Company will continue to pursue the philosophy of
driving development through high-quality and hot-selling products in 2021 and work hard to create
a series of high-quality products that are integrated with high technologies, enable high gross
margins, have high aesthetic values and receive high praise from consumers.
(III) To further improve risk control mechanism
In 2021, the Company will continue to improve our risk control mechanisms. The Company will
continue to improve and optimize the decision-making process, implement and improve the
three-level risk control mechanism and strengthen the process approach to the control of reviews
and decision-makings, thereby creating effective closed-loop mechanisms and improving
decision-making efficiency. The Company will also improve the identification of risks associated
with our operating processes, continuously improve the basic work of risk control, and continuously
improve our work quality and efficiency through means such as strengthening the control of the
front end of operating processes, conducting regular risk reviews, and implementing special
inspections.
(IV) Main Works of Various Business Divisions
1. Industrial Product Division
(1) The Multimedia Sub-division
In 2021, the Multimedia Sub-division will continue to optimize its business and product structures,
focus on creating high-quality products, improve gross margins and continuously improve operating
quality.
(2) The White Goods Sub-division
In 2021, the White Goods Sub-division will improve the overall competitiveness of our white goods
businesses by centering on the theme of "diversify brands, channels and categories and create
high-end products." The Company will also continue to review and re-engineer our organizational
41
Konka Group Co., Ltd. Annual Report 2020
structure and systematically re-engineer the organizational system of our white goods businesses to
improve management efficiency through coordinated operation of the Konka and Frestec brands.
(3) The Environmental Protection Sub-division
In 2021, the Environmental Protection Sub-division will improve the operating performance
through multiple means such as upgrading production lines and improving sales capacity.
(4) The Semiconductor Sub-division
In 2021, the Semiconductor Sub-division will increase investment in R&D of optoelectronics,
memory, third-generation compound semiconductors and other technologies and accelerate efforts
to make and commercialize technological breakthroughs. In addition, the semiconductor business
will complete the implementation of Yancheng memory chip packaging and testing base as soon as
possible, and do a good job in iteration and sales planning of storage products.
(5) The Mobile Internet Sub-division
In 2021, the Mobile Internet Sub-division will fine-tune its guidelines of development and strategic
plan and drive business transformation and strategic breakthroughs.
(6) The PCB Sub-division
In 2021, the PCB Sub-division will strive for expansion and increase our presence in the PCB
industry, leverage Suining PCB Industrial Park as a platform to drive product structure upgrading
and accelerate business growth. Efforts will also be made to realize the operation of the PCB
business unified procurement and sales platform as soon as possible.
2. Technology Park Division
In 2021, the Technology Park Division will actively drive the implementation of the "Investment +
Parks" and "Technology + Parks" modes to realize integrated and coordinated development of
investment, fund, technology and industrial park businesses. Active efforts will also be made to
drive the implementation of major projects following the principle of planning with high
requirements, implementing according to high standards and completing with high quality, thereby
continuously improving our capacity for industry investment attraction, project implementation,
post-investment management and park operation.
3. Platform Service Division
(1) The Industry Trade Business
In 2021, the Industry Trade Sub-division will continue to drive the trade-to-manufacturing
transformation,. Active efforts will also be made to develop new customers and new businesses,
continuously adjust the business structure and improve profitability.
(2) The Internet Sub-division
In 2021, the Internet Sub-division will further advance multi-scenario operation, deepen the
utilization of web traffic through the Yijuping strategy, improve our capacity for commercialize
multi-scenario traffic, continuously improve user structure, expand user channels and diversify user
42
Konka Group Co., Ltd. Annual Report 2020
sources.
4. Financial Investment Division
(1) The Investment Sub-division
In 2021, the Investment Sub-division will actively develop new businesses through investment and
acquisition. The Company will also further increase the size of the funds following the principle of
"able to attract capital, able to invest the attracted capital and able to withdraw investments,"
implement the "Investment + Parks" mode and strengthen the coordination and synergy with
industrial park projects.
(2) The Venture Capital Investment Sub-division
In 2021, the Venture Capital Investment Sub-division will further improve its systems and
mechanism, innovate business models and develop new and profitable businesses. The Sub-division
will also accelerate efforts to foster national incubators.
X Communications with the Investment Community such as Researches, Inquiries and
Interviews
1. During the Reporting Period
√ Applicable □ Not applicable
Way of Type of Communi Index to main
Main discussions and materials
Date Place communi communicatio cation information
provided by the Company
cation n party party communicated
Discussions were about the
development, production and
sales of Micro LED-related
Conferenc
products, the purpose of the
e Room
Guo Lili acquisition of Frestec Electrical
of Office One-on-o
2 Jan. (Founder Appliances equities, the purpose http://www.cninfo.co
Building ne Institution
2020 Securities of the expansion to the m.cn/new/index
of Konka meeting
) environmental industry and the
R&D
specific segments involved in
Building
the environmental industry. And
no materials were provided by
the Company.
Times of communications 1
Number of institutions communicated with 1
Number of individuals communicated with 0
Number of other communication parties 0
Tip-offs or leakages of substantial
supposedly-confidential information during None
communications
43
Konka Group Co., Ltd. Annual Report 2020
Part V Significant Events
I Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)
How the profit distribution policy, especially the cash dividend policy, for ordinary shareholders
was formulated, executed or revised in the Reporting Period:
√ Applicable □ Not applicable
The cash dividend policy of the Company was clearly stated in its Articles of Association, with
specific and clear dividend standards and ratios. The relevant decision-making procedure and
mechanism were sound; the independent directors faithfully performed their duties and played their
due role; and the non-controlling interests were able to fully express their opinion and desire and
their legal rights and interests were fully protected. The Company strictly followed the cash
dividend policy in its Articles of Association, and the cash dividend payout of the Company was in
line with its Articles of Association and the relevant resolution of the Shareholders’ Meeting.
According to the requirements of the Listed Company Supervision Guideline No. 3-Listed
Companies’ Cash Dividend issued by the CSRC, the Company has revised the dividend payout
policy in its Articles of Association, further clarifying the priority and proportion of cash dividend
in dividend payouts. In order to further normalize its shareholder return mechanism, push forward
the establishment of a scientific, sustained and stable shareholder return mechanism, enhance the
transparency and operability of decision-making for its dividend payout policy, and effectively
protect the legal rights and interests of public investors, the Company strictly followed the
Shareholder Return Planning for Subsequent Three Years (2019-2021), which was formulated in
2019.
Special statement about the cash dividend policy
In compliance with the Company’s Articles of Association and resolution of general
Yes
meeting
Specific and clear dividend standard and ratio Yes
Complete decision-making procedure and mechanism Yes
Independent directors faithfully performed their duties and played their due role Yes
Non-controlling interests are able to fully express their opinion and desire and their
Yes
legal rights and interests are fully protected
In case of adjusting or changing the cash dividend policy, the conditions and
Yes
procedures involved are in compliance with applicable regulations and transparent
The profit distributions to ordinary shareholders, either in the form of cash or stock, in the past three
years (including the Reporting Period) are summarized as follows:
1. Dividend Payout Plan for 2020
44
Konka Group Co., Ltd. Annual Report 2020
Based on the total shares of 2,407,945,408 as of the end of 2020, a cash dividend of RMB1.00 (tax
inclusive) per 10 shares was planned to be distributed to all the shareholders, with the total dividend
payout reaching RMB240,794,540.80. And the retained earnings should carry forward for future
payout without bonus issue from capital reserves and profit.
2. Dividend Payout Plan for 2019
Based on the total shares of 2,407,945,408 as of the end of 2019, a cash dividend of RMB0.50 (tax
inclusive) per 10 shares was distributed to all the shareholders, with the total dividend payout
reaching RMB120,397,270.40. And the retained earnings should carry forward for future payout
without bonus issue from capital reserves and profit.
2. Dividend Payout Plan for 2018
Based on the total shares of 2,407,945,408 as of the end of 2018, a cash dividend of RMB1.00 (tax
inclusive) per 10 shares was distributed to all the shareholders, with the total dividend payout
reaching RMB240,794,540.80. And the retained earnings should carry forward for future payout
without bonus issue from capital reserves and profit.
Cash dividend for ordinary shareholders in the past three years (including the Reporting Period)
Unit: RMB
Net profit
attributable to
Cash Total cash
ordinary
dividends dividends
Cash shareholders of in other
A as % of B forms C as % of B (including D as % of B
Year dividends (tax the listed
(%) (such as (%) those in (%)
inclusive) (A) company in share
repurchas other
consolidated
e) (C) forms) (D)
statements for
the year (B)
240,794,540. 477,633,250.1 240,794,
2020 50.41% 0 0.00% 50.41%
80 4 540.80
120,397,270. 212,034,210.0 120,397,
2019 56.78% 0.00 0.00% 56.78%
40 8 270.40
240,794,540. 411,289,744.6 240,794,
2018 58.55% 0.00 0.00% 58.55%
80 8 540.80
Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for the
ordinary shareholders despite the facts that the Company has made profits in the Reporting Period
and the profits of the Company as the parent distributable to the ordinary shareholders are positive.
□ Applicable √ Not applicable
II Final Dividend Plan for the Reporting Period
√Applicable □ Not applicable
Share dividend per 10 shares from retained earnings 0
45
Konka Group Co., Ltd. Annual Report 2020
(share)
Cash dividend per 10 shares (RMB) (tax inclusive) 1.00
Share base (share) 2,407,945,408
Total cash dividends (RMB) (tax inclusive) 240,794,540.80
Cash dividends in other ways (such as share repurchase)
0
(RMB)
Total cash dividends (including other ways) (RMB) 240,794,540.80
Distributable profits (RMB) 4,595,371,391.63
Cash dividends as a percentage of total profits to be 100%
distributed (%)
Details of cash dividend for the Reporting Period
The minimum proportion of cash dividend to this profit distribution should be 80% when the Company distributed the profits
under the condition that the Company was in mature stage with large capital cost.
Details of plan for profit distribution or bonus issue from capital reserves
The audited net profit attributable to owners of the Company as the parent in 2020 was RMB477,633,250.14, retained earnings
were RMB4,595,371,391.63. In accordance with relevant laws and regulations, provisions of Articles of Associations and
demand of the Company for sustainable development, the Company didn’t withdrew statutory surplus reserve and discretionary
reserve, and the profit distribution plan was supposed to be as follows: based on the total shares of 2,407,945,408 as of the end of
2020, a cash dividend of RMB1.00 (tax inclusive) per 10 shares was distributed to all the shareholders, with the total dividend
payout expected reaching RMB240,794,540.80. And the retained earnings should carry forward for future payout without bonus
issue from capital reserves and profit. If the share capital changed after the Board of directors reviewed the profit distribution
plan, the cash dividend per share shall be adjusted in the principle of the unchanged total distribution amount.
III Fulfillment of Commitments
1. Commitments of the Company’s Actual Controller, Shareholders, Related Parties and
Acquirers, as well as the Company Itself and other Entities Fulfilled in the Reporting Period
or Ongoing at the Period-end
√Applicable □ Not applicable
Date Ter
Type of m
of com of Fulfi
Commit
Promisor com Details of commitment mitm com llme
ment
mitm ent mit nt
ent maki men
ng t
Commit Othe The Company and other companies under the control of the
28 1
ment Overseas Chinese r Company and persons acting in concert have no share Com
Septe July
made in Town Enterprises com reduction plan during the period from six months before the plete
mber 202
IPO or Co. mitm Private Placement Board Meeting (28 September 2018) to the d
2018 0
refinanc ent issuance date of the commitment. To avoid the short-swing
46
Konka Group Co., Ltd. Annual Report 2020
ing trading stipulated in the Securities Law, the Company and
other companies under the control of the Company and persons
acting in concert don’t reduce the shares of Konka directly or
indirectly during the period from six months before the Private
Placement Board Meeting (28 September 2018) to six months
after the completion of share issue.
If Konka Group and its majority-owned subsidiaries are
subject to any administrative punishment or investigated due to
any real estate-related illegal acts within the Reporting Period 31
Othe
including the undisclosed idle land, the land speculation, the Dec
Overseas Chinese r 13 Com
property hoarding and the housing price gouging etc., which emb
Town Enterprises com May plete
has caused any losses to the listed company or the investor, the er
Co. mitm 2019 d
Company will burden corresponding liabilities for 202
ent
compensation according to relevant laws, regulations and 0
provisions issued by the securities market supervision
department.
1. Companies excluding Konka Group and various subsidiaries
under the Company’s control (hereinafter referred to as “Other
Companies”) will maximally reduce and avoid any related
transaction with the Konka Group, and shall neither take
Com advantage of its status as Konka Group’s controlling
mitm shareholder to seek any improper privilege and illegitimate
ents right superior than any third party on the market in the aspect
on of business cooperation with Konka Group, nor to obtain the
horiz priority in concluding any transaction with Konka Group. 2. If
ontal any necessary transaction cannot be avoided, the Company and
comp other companies under the Company’s control will legally sign
etitio corresponding agreement with Konka Group according to such 31
n, principles as fairness, objectiveness and valuable 28 Dec
Overseas Chinese Com
relate compensation, fulfill various legal procedures and perform Marc emb
Town Enterprises plete
d-par their obligation in information disclosure and relevant internal h er
Co. d
ty decision making and approval procedures according to 2019 202
trans applicable laws, regulations and the Articles of Association so 0
actio as to guarantee the fairness of the related transaction price.
n and However, they shall not take advantage of such transaction to
capit take any act which will damage the legitimate interests of
al Konka Group and the group’s other shareholders. 3. The
occu Company will fulfill its due obligations as Konka Group’s
patio controlling shareholder based on good faith, fully respect
n Konka Group’s status of an independent legal person and
guarantee its independent management and decision making.
Meanwhile, the Company guarantees that, it will attend the
General Meeting according to the Articles of Association,
equally exercise various rights and burden due obligations, and
47
Konka Group Co., Ltd. Annual Report 2020
restrain itself from seeking any illegitimate interests in the
name of the Group’s controlling shareholder and illegally
transferring any capital and profit of Konka Group and its
controlled subsidiaries by taking advantage of any related
transaction. In addition, the Company commits not to damage
any legitimate rights and interests of Konka Group and other
shareholders. 4. If the Company breaks the above-mentioned
promise and guarantee, it shall compensate any losses suffered
by Konka Group and its investors for this reason.
1. As of the issuance date of the letter of commitment, the
Company neither directly or indirectly involves in any business
competing with Konka Group’s main business, nor directly or
indirectly carry on any business competing with Konka
Group’s main business by holding any shares or controlling
any third party. 2. If the existing business of the Company and
companies excluding Konka Group and various subsidiaries
under the Company’s control (hereinafter referred to as “Other
Com
Companies”) competes with the Konka Group’s main business
mitm
or other companies’ business development competes with
ents
Konka Group’s main business during the Company’s serving
on
as the Konka Group’s controlling shareholder, the Company
horiz
and other companies under the Company’s control shall
ontal
(including but not limited to) cease such business operation or
comp
integrate such competing business into Konka Group or
etitio 31
transfer it other irrelevant third parties, preventing the
n, 28 Dec
Overseas Chinese Company and other companies under its control from Com
relate Marc emb
Town Enterprises involving in any business competing with Konka Group’s main plete
d-par h er
Co. business. If any business opportunity obtained from any third d
ty 2019 202
party substantially or possibly competes with Konka Group’s
trans 0
main business, the Company will immediately inform Konka
actio
Group of that and transfer such business opportunity to Konka
n and
Group unless one of the following conditions is met: (1) such
capit
business opportunity is administratively transferred to or
al
assigned to the Company and other companies under its
occu
control by the government based on the directional agreement
patio
according to applicable national laws, regulations and policies;
n
or (2) Konka Group fails to meet special requirements
positioned to the bidder or the assignee in corresponding
project bidding, transfer and assignment conditions, but the
Company or other companies under its control does. 3. If
Konka Group gives up the above-mentioned business
opportunity and the Company and other companies under the
Company’s control take advantage of such opportunity to
conduct any business substantially or possibly competing with
48
Konka Group Co., Ltd. Annual Report 2020
the Konka Group’s main business, the Company will give
Konka Group any option. Namely, if permitted by applicable
laws and regulations and relevant provisions stated in the
Articles of Association, Konka Group shall have the right to
completely or gradually purchase any equity, assets and other
interests related to the above-mentioned business from the
Company and other companies under the Company’s control,
or Konka Group shall own or actually control corresponding
assets or business obtained by the Company and other
companies the Company’s control from the above-mentioned
business by means of entrusted operation, lease or contract
operation according to applicable national laws and
regulations. If the third party on an equal footing has the right
to execute and will execute its legal preemptive right, the
above-mentioned commitment shall not apply. However, in
this case, the Company and other companies under the
Company’s control shall try their best to prompt the third party
to give up such preemptive right. 4. The Company shall
confirm that each commitment made herein constitutes an
independent executable commitment, and any commitment’s
ineffectiveness or termination will not influence the validity of
other commitments; if any of the above-mentioned
commitments and guarantees is violated, the Company is
willing to burden all resulting economic losses suffered by
Konka Group.
I. Konka Group’s personnel shall be kept independent. 1. It’s
required that the Konka Group’s senior managers shall
exclusively work for and receive compensation from Konka
Group, and shall not hold other posts other than directors and
supervisors in other companies excluding Konka Group and
various subsidiaries under the Company’s control (hereinafter
referred to as “Other Companies”). 2. It’s guaranteed that
31
Othe Konka Group’s HR relations and labor relations independent of
28 Dec
Overseas Chinese r the Company and other companies under the Company’s Com
Marc emb
Town Enterprises com control. 3. It’s guaranteed that all candidates recommended by plete
h er
Co. mitm the Company to serve as Konka Group’s directors, supervisors d
2019 202
ent and senior managers are subject to legal procedures, and the
0
Company shall not interfere any decision on personnel
appointment and removal made by Konka Group’s Board of
Directors and Shareholder’s Meeting. II. Konka Group’s
finance shall be kept independent. 1. Konka Group and its
controlled subsidiaries shall establish their independent
financial accounting department, financial calculation system
and financial management system. 2. It shall be guaranteed
49
Konka Group Co., Ltd. Annual Report 2020
that Konka Group and its subsidiaries could make independent
financial decisions and would not interfere Konka Group’s use
of funds. The capital of Konka Group and its subsidiaries shall
not be occupied by the Company and other companies under
the Company’s control by means of borrowing, debt
repayment, advance payment or in other ways with their rights
and interests not seriously damaged by the Company and other
companies under the Company’s control. 3. The Konka Group
and its subsidiaries shall independently open their accounts in
the bank, and shall not share the same bank account with the
Company and other companies under the Company’s control.
4. Konka Group and its subsidiaries shall legally and
independently pay taxes. III. The Konka Group’s institutional
independence shall be kept. 1. The Konka Group and its
subsidiaries shall legally establish and perfect their corporate
governance structure, set up their independent and complete
institutional framework, and completely separate from the
Company and other companies under the Company’s control.
Namely, the Konka Group and its subsidiaries and the
Company and other companies under the Company’s control
shall respectively establish their own offices and business
operation sites. 2. It’s guaranteed that the Konka Group and its
subsidiaries could operate independently, and the Company
would not bypass the Shareholder’s Meeting to directly or
indirectly interfere Konka Group’s decision making and
business operation. IV. Konka Group shall keep its assets
independent and complete. 1. Konka Group and its subsidiaries
shall possess complete operating assets. 2. It’s guaranteed that
the capital, assets and other resources of Konka Group and its
subsidiaries would not be illegally occupied. V. The Konka
Group shall guarantee its business independence. 1. After this
issue, Konka Group shall possess corresponding assets,
personnel and qualification for independently carry out
business operations and the ability of independent management
based on the market without relying on the Company and other
companies under the Company’s control. 2. The Company and
other companies under the Company’s control shall avoid any
horizontal competition with Konka Group’s main business. 3.
Various related transactions shall be strictly controlled, and
corresponding continuous related transaction must be reduced
between the Konka Group and its subsidiaries and the
Company and its affiliated companies. It’s not allowed to
illegally occupy the Company’s assets and funds. However,
any unavoidable related transactions will be priced based on
50
Konka Group Co., Ltd. Annual Report 2020
such principles as Fairness, Justice and Openness. Meanwhile,
for any significant related transaction, it’s required to fulfill
corresponding information disclosure obligation, complete
relevant approval procedures and disclose related information
according to Konka Group’s Articles of Association and
applicable laws and regulations. 4. It is not allowed to interfere
any major decision made by the Konka Group and affect the
independence of Konka Group’s assets, personnel, finance,
institution and business via independent operation or act in
concert in any way other than the execution of shareholder’s
right.
1. It’s not allowed to interfere the operation and management
activities of the Company excessively; 2. It’s not allowed to
encroach the interest of the Company; 3. During the period
from the issuance date of the commitment to the completion, if
China Securities Regulatory Commission (hereinafter referred
to as “CSRC”) publishes any new regulatory provisions on
31
Othe such compensation and reward measures and the
28 Dec
Overseas Chinese r above-mentioned commitments are not in conformity with Com
Marc emb
Town Enterprises com such provisions, the Company will make a supplementary plete
h er
Co. mitm commitment then according to the latest provisions issued by d
2019 202
ent CSRC. 4. The Company earnestly promises to adhere to
0
various compensations and reward policies established by the
Company and make corresponding promises; if the Company
breaks such promises and cause any losses to the Company or
the investor, the Company is willing to legally compensate any
losses suffered by the Company or the investor due to the
violation against such commitment.
1. The restricted stock trade period of Konka Group subscribed
by the Company is 36 months. Namely, the stock subscribed
by the Company shall not be transferred within 36 months
from the end of the day of this issue (calculating from the day
when the additional issue of stocks obtained is registered in the
Shenzhen name of the Company and the same below); all stocks derived 31
Othe
Overseas Chinese from any stocks obtained by the Company during this issue 28 Dec
r Com
Town Capital (including new stocks obtained by distributing stock dividends Febr emb
com plete
Investment and adding the capital reserve into the capital stock) shall also uary er
mitm d
Management Co., be subject to the above-mentioned lock-up arrangement. After 2019 202
ent
Ltd. the above-mentioned lock-up period expires, the transfer and 0
transaction of corresponding stocks shall be performed
according to the then effective laws, regulations and various
rules, provisions and requirements put forward by China
Securities Regulatory Commission (hereinafter referred to as
“CSRC”) and Shenzhen Stock Exchange (hereinafter referred
51
Konka Group Co., Ltd. Annual Report 2020
to as “SSE”). 2. Before this issue, all stocks held by the
Company and the persons acting in concert from Konka Group
shall be locked up for 12 months from the end of the day of
this issue. Stocks held by the Company and the persons acting
in concert from Konka Group before this issue correspond to
additional stocks held in Konka Group due to the distribution
of dividends and the conversion into share capital, which shall
also be subject to the above-mentioned agreement.
I. The Company is legally established and exists validly
according to applicable Chinese laws and regulations with full
capacity for civil rights and civil conduct, possesses
corresponding qualification for subscribing stocks issued by
Konka Group as stipulated in Chinese laws, administrative
laws and regulations, departmental regulations and normative
documents, and has obtained all due internal approvals or
licenses for subscribing this issue of stocks. II. The Company
shall not involve in any of the following situations: 1. the
Company damages the legitimate rights and interests of Konka
Group and its shareholders during the subscription of stocks
from Konka Group; 2. the Company is encumbered with a
relatively large amount of outstanding debts;3. the Company
has any severe unlawful act or is a suspect of any severe
unlawful act in the recent 3 years; 4. the Company has any
Shenzhen severe dishonest conduct on the stock market in the recent 3 31
Othe
Overseas Chinese years; 5. any situation under which the subscription of the 28 Dec
r Com
Town Capital listed company’s stocks is not allowed according to applicable Marc emb
com plete
Investment laws, administrative regulations and various provisions issued h er
mitm d
Management Co., by CSRC.III. The Company, the Company’s directors, 2019 202
ent
Ltd. supervisors and senior managers (or key personnel) are not 0
subject to any administrative punishment (except those
obviously irrelevant to the stock market), criminal punishment
or any major civil action related to any economic disputes in
the recent 5 years, and any major civil arbitration related to any
economic disputes in the recent 5 years is concluded. IV. After
this subscription, any business conducted by the Company
shall not compete with or potentially compete with that of
Konka Group. V. Within 24 months before Konka Group’s
disclosure of this stock issue plan, all major transactions
between the Company and Konka Group shall be subject to all
necessary decision-making procedures according to various
provisions geared to the related transaction, and corresponding
information is disclosed. Such related transaction is conducted
for the need of normal business development of Konka Group
without damaging the interests of Konka Group and other
52
Konka Group Co., Ltd. Annual Report 2020
shareholders. VI. This subscription made by the Company
shall base on corresponding analysis and judgment on the
stock trade market, and the Company has a good vision on
Konka Group’s development prospect and investment value.
VII. Various stocks subscribed during this issue shall be
completely and directly owned by the Company without any
entrustment or trust or other similar arrangements by any
means. VIII. The Company’s funds for this subscription shall
be its legal self-owned funds or self-raised funds, and the
Company promises that, after this issue by Konka Group is
approved by CSRC and the notice on the stock subscription
payment is sent by Konka Group, the Company would transfer
the full stock subscription payment into the designated funds
supervision bank account according to Conditional Non-public
Issue of Stocks Subscription Agreement and its supplementary
agreement. IX. The Company’s sole shareholder is OCT Group
Co., Ltd., and actual controller is the State-owned Assets
Supervision and Administration Commission of the State
Council. For any contribution by the Company’s shareholders,
any graded income and structured arrangement shall neither be
applied, nor any leverage financing structured design product.
X. The Company will provide Konka Group with various
information related to this subscription, and guarantee that all
provided information are true, correct and complete. XI. The
Company shall guarantee not to transfer any subscribed stock
within the restricted stock transfer period as stipulated in
applicable laws, administrative regulations and various
provisions issued by CSRC from the end of the day of
subscription.
1. It’s allowed neither to convey any interest to other units or
individuals free of charge or in an unfair way, nor to damage
the Company’s interest in other ways; 2. It’s required to
restrain my position-related consumption behavior; 3. It’s not
allowed to conduct any investment and consumption activities
Shenzhen 31
Othe irrelevant to my execution of duty by using the Company’s
Overseas Chinese 28 Dec
r assets; 4. The remuneration system established by the Board of Com
Town Capital Marc emb
com Directors or the remuneration and appraisal committee shall be plete
Investment h er
mitm linked up with the Company’s implementation of d
Management Co., 2019 202
ent compensation and reward measures; 5. If the Company
Ltd. 0
executes the equity-based incentives, the vesting conditions of
the proposed equity-based incentives shall correspond with the
Company’s implementation of compensation and reward
measures; 6. From the day of issuing the Letter of
Commitment to the issue, if China Securities Regulatory
53
Konka Group Co., Ltd. Annual Report 2020
Commission (hereinafter referred to as “CSRC”) publishes any
new regulatory provisions on such compensation and reward
measures and the above-mentioned commitments are not in
conformity with such provisions, I will make a supplementary
commitment then according to the latest provisions issued by
CSRC. 7. I earnestly promise to adhere to various
compensation and reward policies established by the Company
and make corresponding promises; if I break such promises
and cause any losses to the Company or the investor, I’m
willing to legally compensate any losses suffered by the
Company or the investor due to my violation against such
commitment.
If Konka Group and its holding subsidiaries are subject to any
administrative punishment or investigated due to any real
Shenzhen 31
Othe estate-related illegal acts within the Reporting Period including
Overseas Chinese Dec
r the undisclosed idle land, the land speculation, the property 13 Com
Town Capital emb
com hoarding and the housing price gouging etc., which has caused May plete
Investment er
mitm any losses to the listed company or the investor, the Company 2019 d
Management Co., 202
ent will burden corresponding liabilities for compensation
Ltd. 0
according to relevant laws, regulations and provisions issued
by the securities market supervision department.
1. It’s allowed neither to convey any interest to other units or
individuals free of charge or in an unfair way, nor to damage
the Company’s interest in other ways; 2. It’s required to
restrain my position-related consumption behavior; 3. It’s not
allowed to conduct any investment and consumption activities
irrelevant to my execution of duty by using the Company’s
assets; 4. The remuneration system established by the Board of
Directors or the remuneration and appraisal committee shall be
linked up with the Company’s implementation of
31
The directors, Othe compensation and reward measures; 5. If the Company
28 Dec
supervisors and r executes the equity-based incentives, the vesting conditions of Com
Marc emb
senior managers com the proposed equity-based incentives shall correspond with the plete
h er
of Konka Group mitm Company’s implementation of compensation and reward d
2019 202
Co., Ltd. ent measures; 6. From the day of issuing the Letter of
0
Commitment to the issue, if China Securities Regulatory
Commission (hereinafter referred to as “CSRC”) publishes any
new regulatory provisions on such compensation and reward
measures and the above-mentioned commitments are not in
conformity with such provisions, I will make a supplementary
commitment then according to the latest provisions issued by
CSRC. 7. I earnestly promise to adhere to various
compensation and reward policies established by the Company
and make corresponding promises; if I break such promises
54
Konka Group Co., Ltd. Annual Report 2020
and cause any losses to the Company or the investor, I’m
willing to legally compensate any losses suffered by the
Company or the investor due to my violation against such
commitment.
If Konka Group and its holding subsidiaries are subject to any
administrative punishment or investigated due to any real
31
Othe estate-related illegal acts within the Reporting Period including
The directors and Dec
r the undisclosed idle land, the land speculation, the property 13 Com
senior managers emb
com hoarding and the housing price gouging etc., which has caused May plete
of Konka Group er
mitm any losses to the listed company or the investor, the Company 2019 d
Co., Ltd. 202
ent will burden corresponding liabilities for compensation
0
according to relevant laws, regulations and provisions issued
by the securities market supervision department.
Fulfill on time or not Yes
Specific reasons for failing to fulfill commitments on time and plans for next step (if any) None
2. Where there had an earnings forecast for an asset or project and the Reporting Period was
still within the forecast period, explain why the forecast has been reached for the Reporting
Period.
□ Applicable √ Not applicable
IV Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
V Explanations Given by the Board of Directors, the Supervisory Board and the Independent
Directors (if any) Regarding the Independent Auditor's “Modified Opinion” on the Financial
Statements of the Reporting Period
□ Applicable √ Not applicable
VI YoY Changes to Accounting Policies, Estimates and Methods
√ Applicable □ Not applicable
In 2017, the Ministry of Finance issued the revised "Accounting Standards for Business Enterprises
No. 14-Revenue" (referred to as the "New Revenue Standards"). The Company starts to implement
the above newly revised standards since 1 January 2020. In accordance with the link up provision,
no adjustment was made to information of comparative period, and the Company retroactively
adjusted the retained earnings of period-begin or other comprehensive income based on the
difference between the current standards and the new standards on the first execution date.
VII Retrospective Restatements due to Correction of Material Accounting Errors in the
Reporting Period
□ Applicable √ Not applicable
55
Konka Group Co., Ltd. Annual Report 2020
No such cases in the Reporting Period.
VIII YoY Changes to the Scope of the Consolidated Financial Statements
□ Applicable √ Not applicable
Refer to Part IV-II-2-(6) for details.
IX Engagement and Disengagement of Independent Auditor
Current independent auditor:
Name of the domestic independent auditor ShineWing Certified Public Accountants LLP
The Company’s payment to the domestic independent auditor
330
(RMB’0,000)
How many consecutive years the domestic independent auditor
2 years
has provided audit service for the Company
Names of the certified public accountants from the domestic
Guo Dongchao, Zhan Miaoling
independent auditor writing signatures on the auditor’s report
How many consecutive years the certified public accountants
2 years
have provided audit service for the Company
Name of the overseas independent auditor (if any) N/A
The Company’s payment to the overseas independent auditor
0
(RMB’0,000) (if any)
How many consecutive years the overseas independent auditor
N/A
has provided audit service for the Company (if any)
Names of the certified public accountants from the overseas
independent auditor writing signatures on the auditor’s report N/A
(if any)
How many consecutive years the certified public accountants
N/A
have provided audit service for the Company (if any)
Indicate by tick mark whether the independent auditor was changed for the Reporting Period
□ Yes √ No
Independent auditor, financial advisor or sponsor engaged for the audit of internal controls:
√ Applicable □ Not applicable
The Company appointed ShineWing Certified Public Accountants LLP as the internal control
auditor in 2020 with RMB0.6 million of payment for the internal control audit.
X Possibility of Listing Suspension or Termination after Disclosure of this Report
□ Applicable √ Not applicable
XI Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XII Major Legal Matters
56
Konka Group Co., Ltd. Annual Report 2020
√ Applicable □ Not applicable
Index
to
Disclos disclo
Involved amount Provisi Progres Decisions and Execution of
General information ure sed
(RMB’0,000) on s effects decisions
date infor
matio
n
The Company
won the case. The court has
As matured notes were failed At present, it adopted
to be accepted, the Company The is in the property
has filed a lawsuit with the Compa execution preservation,
court to request China Energy ny has stage. Based which are
Electric Fuel Co., Ltd., China won on the currently in the
Energy (Shanghai) Enterprise the principle of implementation 25
Co., Ltd.., Shanghai 5,000 Not case prudence, the stage. The June
Nengping industrial Co., and the Company has Company has 2019
Ltd., and Shenzhen Qianhai judgme withdrawn applied for the
Baoying Factoring Co., Ltd. nt was relevant corresponding
to pay the bill and the in impairment shareholder to
corresponding interest to the effect. provision be the
Company. according to additional http://
accounting respondent. www.
policies. cninf
The Company o.co
won the case. m.cn/
At present, it new/i
As matured notes were failed The is in the ndex
to be accepted, the Company Compa execution
The court has
has filed a lawsuit with the ny has stage. Based
adopted
court to request Shanghai won on the
property
Huaxin International Group the principle of 25
preservation,
Co., Ltd. and Tianjin 5,000 Not case prudence, the June
which are
International Trade and the Company has 2019
currently in the
Petrochemical Co., Ltd. to judgme withdrawn
implementation
pay the bill and the nt was relevant
stage.
corresponding interest to the in impairment
Company. effect. provision
according to
accounting
policies.
As matured notes were failed 15,000 Not The The Company The court has 25
57
Konka Group Co., Ltd. Annual Report 2020
to be accepted, the Company Compa won the case. adopted June
has filed a lawsuit with the ny has At present, it property 2019
court to request Shanghai won is in the preservation,
Huaxin International Group the execution which are
Co., Ltd. Qingdao Bonded case stage. Based currently in the
Zhongshe International and the on the implementation
Trading Co., Ltd. and judgme principle of stage.
Shenzhen Qianhai Benniu nt was prudence, the
Agricultural Technology Co., in Company has
Ltd. to pay the bill and the effect. withdrawn
corresponding interest to the relevant
Company. impairment
provision
according to
accounting
policies.
The case is
The
under trial
court
with no
As matured notes were failed has
effective
to be accepted, Konka adopte
judgment yet. The court has
Factoring has filed a lawsuit d
Based on the adopted
with the court to request propert
principle of property
Tahoe Group Co., Ltd., y 25
prudence, the preservation,
Fuzhou Taijia Enterprise Co., 5,067.67 Not preserv June
Company has and the case is
Ltd., and Xiamen Lianchuang ation, 2019
withdrawn under trial with
Microelectronics Co., Ltd. to and the
relevant no effective
pay the bill and the case is
impairment judgment yet.
corresponding interest to at the
provision
Konka Factoring. trial
according to
stage.
accounting
policies.
The Company
The
As matured notes were failed won the case.
Compa
to be accepted, the Company At present, it The court has
ny has
has filed a lawsuit with the is in the adopted
won
court to request Hefei Huajun execution property
the 25
Trading Co., Ltd. and Wuhan stage. Based preservation,
7,830.07 Not case June
Jialian Agricultural on the which are
and the 2019
Technology Development principle of currently in the
judgme
Co., Ltd. to pay the bill and prudence, the implementation
nt was
the corresponding interest to Company has stage.
in
the Company. withdrawn
effect.
relevant
58
Konka Group Co., Ltd. Annual Report 2020
impairment
provision
according to
accounting
policies.
The
court
support
ed the
objecti
The customer of Hong Kong ons of
Konka, H-BUSTER SAO some Bankruptcy
PAULO INDUSTRIAE creditor proceedings
COMERCIO S.A (Brazil) s to the are under way.
was insolvent, and obtained reorgan Based on the
the approval of the judicial ization principle of
reorganization application of plan prudence, the
Bankruptcy 25
Cotia Third Civil Court of the and Company has
1,939.38 Not proceedings are June
Court of Sao Paulo, Brazil in declare withdrawn
under way 2019
May 2013. As the creditor of d HB relevant
H-BUSTER, Hong Kong bankru impairment
Konka filed the debt pt. At provision
declaration documents, and in present, according to
August 2014, the amount the accounting
confirmed of debt was bankru policies.
USD2.78 million. ptcy
procee
dings
are
under
way.
Due to the Jiangxi Xinxin The
Jian’an Engineering Co., Ltd. corresponding
(hereinafter referred to as the liability of risk
“Jiangxi Xinxin”), Jiangxi assumed by
The
Shanshi Technology the Company's
case is
Development Co., Ltd. controlled 25
in the
(hereinafter referred to as the 31,375.80 Not companies Suit pending June
second
“Jiangxi Shanshi”), Jiangxi involved in the 2019
instanc
Zhongyi Decoration case is
e.
Materials Co., Ltd. controllable.
(hereinafter referred to as the Other
“Jiangxi Zhongyi”) failed to defendants
repay the loan and its interest exclusive of
59
Konka Group Co., Ltd. Annual Report 2020
of China Great Wall AMC the controlled
Jiangxi Branch (hereinafter companies of
referred to as the “Great Wall the Company
Jiangxi Branch”), the Great are solvent,
Wall Jiangxi Branch sued to and at the
the court, and required same time, the
Jiangxi Xinxin, Jiangxi Company has
Shanshi, Jiangxi Zhongyi to outstanding
repay RMB300 million with payments to
RMB108,000 liquidated the other
damages, and RMB13.65 defendants in
million of interest. this case. The
Meanwhile, 9 guarantors above amount
including Jiangxi Konka, can be offset
Xinfeng Microcrystalline and against the
Nanocrystal are required to Company’s
undertake joint liability debt
guaranty. The judgment of obligations in
first instance was required the future.
Jiangxi Xinxin, Jiangxi
Zhongyi and Jiangxi Shanshi
shall repay the principal,
interest and liquidated
damages to Great Wall
Jiangxi Branch and the
guarantors bear the joint
liability for satisfaction to the
debts. The defendants have
appealed against the first
instance judgment. So far, the
case has not yet been heard in
court.
The case is
pending
Due to the dispute of sales retrial. Based
contract, Wumart Chain Co., on the
Ltd. sued the Beijing Branch The principle of
25
of Wumart to the court of case is prudence, the
2,051.65 Not Suit pending June
Shijingshan District of under Company has
2019
Beijing, and requested the retrial. withdrawn
Beijing Branch to return the relevant
prepayment of goods. impairment
provision
according to
60
Konka Group Co., Ltd. Annual Report 2020
accounting
policies.
All of our
Due to dispute arisen from a
demands were
logistics contract, the The
basically
Company’s subsidiary Anhui case is
supported by 19
Konka filed a lawsuit to in trial The case is in
the court of Septem
request the freight forwarder 3,796.60 Not of trial of second
first instance. ber
Shanghai Triangle Link second instance.
Property 2020
Logistics Co., Ltd. Shenzhen instanc
preservation
Branch to make e.
measures were
compensation.
adopted.
Judgment of
first instance
has come into
effect and is
Due to dispute arisen from an being
advertising contract, the executed.
The Property
Company’s subsidiary E2info Based on the
case is preservation 19
filed a lawsuit with Nanshan principle of
in the measures are Septem
District Court of Shenzhen 758.11 Not prudence, the
executi taken by the ber
Municipality to request Company has
on court and under 2020
Tansuo Media to pay the made
stage. execution.
principal due and liquidated corresponding
damages. provision for
impairment
according to
accounting
policies.
Propert The case is in
y the stage of
Due to dispute arisen form a preserv public
sales contract, the Company’s ation announcement
subsidiary Konka Huanjia before and service.
filed a lawsuit to request litigatio Based on the 19
Dalian Jinshunda Material n was principle of The case is Septem
9,383.08 Not
Recycling Co., Ltd., Huanjia comple prudence, the under trial. ber
Group, Wang Bingde, Zhang ted. Company has 2020
Xueyin, Wang Renping to The made
return the advance payment case is corresponding
and pay liquidated damages. in the provision for
stage of impairment
public according to
61
Konka Group Co., Ltd. Annual Report 2020
announ accounting
cement policies.
and
service.
Propert
y The case is in
preserv the stage of
ation public
Due to dispute arisen form a before announcement
sales contract, the Company’s litigatio and service.
subsidiary Konka Huanjia n was Based on the
filed a lawsuit to request comple principle of 19
Dalian Xinjie Renewable ted. prudence, the The case is Septem
9,383.08 Not
Resources Co., Ltd., Huanjia The Company has under trial. ber
Group, Wang Bingde, Zhang case is made 2020
Xueyin, Wang Renping to in the corresponding
return the advance payment stage of provision for
and pay liquidated damages. public impairment
announ according to
cement accounting
and policies.
service.
The Judgment of
Compa first instance
Due to dispute arisen from a
ny won was made. At
loan contract, the Company 19
the present, Judgment of
filed a lawsuit to the court to Septem
1,035.71 Not case in Finance Dept. first instance
request Chongqing Qingjia ber
trial of records the was made.
Electronics Co., Ltd. to repay 2020
first original value
the loan and interest.
instanc without
e. impairment.
The
Due to contract dispute, the Compa
Company’s subsidiary ny has
Shenzhen Nianhua applied won
The Company 19
for arbitration to request the the
won the case Execution is in Septem
respondent Fang Xianglong 2,045.16 Not case
and execution process. ber
and Jiang Yan to make and the
is in process. 2020
compensation for judgme
corresponding annual profit nt was
and fund possession cost. in
effect.
Due to dispute arisen form a 2,307.90 Not The The case is in The case is 19
62
Konka Group Co., Ltd. Annual Report 2020
sales contract, the Company’s case is the stage of under trial. Septem
subsidiary Konka Huanjia in the public ber
filed a lawsuit to request stage of announcement 2020
Liantianxing Renewable public and service.
Resources Co., Ltd., Huanjia announ Based on the
Group, Wang Bingde, Zhang cement principle of
Xueyin, Wang Renping to and prudence, the
return the advance payment service. Company has
and pay liquidated damages. made
corresponding
provision for
impairment
according to
accounting
policies.
The case is in
the stage of
public
Due to dispute arisen form a
announcement
sales contract, the Company’s The
and service.
subsidiary Konka Huanjia case is
Based on the
filed a lawsuit to request in the
principle of 19
Huanjia Mingtai (Dalian) stage of
prudence, the The case is Septem
Renewable Resources Co., 3,302.64 Not public
Company has under trial. ber
Ltd., Huanjia Group, Wang announ
made 2020
Bingde, Zhang Xueyin, Wang cement
corresponding
Renping to return the and
provision for
advance payment and pay service.
impairment
liquidated damages.
according to
accounting
policies.
The case is in
Due to dispute arisen form a the stage of
sales contract, the Company’s The public
subsidiary Konka Huanjia case is announcement
filed a lawsuit to request in the and service.
19
Lankao Shunjia Renewable stage of Based on the
The case is Septem
Resources Recycling Co., 3,358.80 Not public principle of
under trial. ber
Ltd., Huanjia Group, Wang announ prudence, the
2020
Bingde, Zhang Xueyin, Wang cement Company has
Renping to return the and made
advance payment and pay service. corresponding
liquidated damages. provision for
impairment
63
Konka Group Co., Ltd. Annual Report 2020
according to
accounting
policies.
The case is in
the stage of
public
Due to dispute arisen form a
announcement
sales contract, the Company’s The
and service.
subsidiary Konka Huanjia case is
Based on the
filed a lawsuit to request in the
principle of 19
Henan Shunhenghui stage of
prudence, the The case is Septem
Renewable Resources 3,337.29 Not public
Company has under trial. ber
Recycling Co., Ltd., Huanjia announ
made 2020
Group, Wang Bingde, Zhang cement
corresponding
Xueyin, Wang Renping to and
provision for
return the advance payment service.
impairment
and pay liquidated damages.
according to
accounting
policies.
The case is in
the stage of
public
Due to dispute arisen form a
announcement
sales contract, the Company’s The
and service.
subsidiary Konka Huanjia case is
Based on the
filed a lawsuit to request in the
principle of 19
Henan Jiaxin Renewable stage of
prudence, the The case is Septem
Resources Recycling Co., 3,358.09 Not public
Company has under trial. ber
Ltd., Huanjia Group, Wang announ
made 2020
Bingde, Zhang Xueyin, Wang cement
corresponding
Renping to return the and
provision for
advance payment and pay service.
impairment
liquidated damages.
according to
accounting
policies.
Due to dispute arisen form a The The case is in
sales contract, the Company’s case is the stage of
subsidiary Konka Huanjia in the public 19
filed a lawsuit to request stage of announcement The case is Septem
2,922 Not
Henan Shengxiang public and service. under trial. ber
Renewable Resources announ Based on the 2020
Recycling Co., Ltd., Huanjia cement principle of
Group, Wang Bingde, Zhang and prudence, the
64
Konka Group Co., Ltd. Annual Report 2020
Xueyin, Wang Renping to service. Company has
return the advance payment made
and pay liquidated damages. corresponding
provision for
impairment
according to
accounting
policies.
The case is in
trial of first
instance,
Due to dispute arisen form a pending
Trial of
sales contract, the Company’s judgment.
first
subsidiary Konka Huanjia Based on the
instanc
filed a lawsuit to request principle of 19
e was
Dalian Guangxin prudence, the The case is Septem
3,137.20 Not held,
Environmental Protection Company has under trial. ber
pendin
Equipment Technology made 2020
g
Development Co., Ltd. to corresponding
judgme
return payment for equipment provision for
nt.
and pay liquidated damages. impairment
according to
accounting
policies.
The case is in
trial of first
instance.
Trial of
As matured notes were failed Based on the
first
to be accepted, the Company principle of
instanc
filed a lawsuit with the court prudence, the 19
e was
to request Wuhan Jialian Company has The case is Septem
20,000 Not held,
Agricultural Technology made under trial. ber
pendin
Development Co., Ltd. to pay corresponding 2020
g
the bill and corresponding provision for
judgme
interest to the Company. impairment
nt.
according to
accounting
policies.
Due to payment dispute, the The Arbitration
19
Company’s subsidiary Hong Compa award. The
Arbitration Septem
Kong Konka applied for an 1,023.51 Not ny has Company has
award. ber
arbitration to Shenzhen Court won won the case.
2020
of International Arbitration to the Based on the
65
Konka Group Co., Ltd. Annual Report 2020
request the respondent case. principle of
Makena Electronic (Hong prudence, the
Kong) to pay for goods and Company has
liquidated damages. made
corresponding
provision for
impairment
according to
accounting
policies.
Due to payment dispute, the
Company’s subsidiary Anhui Arbitration
Electrical Appliance applied Arbitra award. The
19
for an arbitration to Chuzhou tion has arbitration
Arbitration Septem
Arbitration Commission to 2,141.50 Not been tribunal
award. ber
request the respondent awarde basically
2020
Makena Electronic d. supports all
(Shenzhen) to make our demands.
guarantee.
The case was
settled through
The
mediation and
case
mediation
was
document is
Due to contract dispute, the settled
being Property
Company filed a lawsuit with through
executed. preservation
Zhengzhou Intermediate mediati
Based on the measures were 19
People’s Court to request on and
principle of taken by the Septem
Henan Radio and Television 3,904.90 Not the
prudence, the court, and ber
Network Co., Ltd. to pick up mediati
Company has mediation 2020
goods and make payment and on
made document is
liquidated damages according docum
corresponding being executed.
to the contract. ent has
provision for
come
impairment
into
according to
effect.
accounting
policies.
Due to condominium The
ownership dispute, the case is Trial of second 19
owners’ committee of in trial instance was The case is Septem
598.56 Not
Jingyuan Building filed a of held, pending under trial. ber
lawsuit to request Zhongfang second judgment. 2020
Group Nanfang Real Estate instanc
66
Konka Group Co., Ltd. Annual Report 2020
Co., Ltd. to make e.
supplementary payment of
maintenance fund.
Zhongfang Group Nanfang
Real Estate Co., Ltd.
submitted a defense on the
ground that the Company
jointly developed Jingyuan
Building, and the Company
was filed as the defendant.
Due to dispute arisen from a
logistics contract, Aluda
Judgme
Logistics filed a lawsuit with Judgment of
nt of
Nanqiao People’s Court of second Judgment of
second 19
Chuzhou to request the instance was second instance
instanc Septem
Company’s subsidiary Anhui 1,282.80 Not made, and the was executed
e has ber
Tongchuan to return the Company and to petition
come 2020
performance bond, pay partly lost the for retrial.
into
transportation costs and case.
effect.
interests incurred, and bear
the litigation costs.
Due to dispute arisen from a Judgme
Judgment of Judgment of
sales contract, Zhao nt of 19
first instance second instance
Yonghong filed a lawsuit second Septem
805.74 Not was held in was made and
with the court to request the instanc ber
trial of second retrial is in
Company’s Konka Huanjia to e was 2020
instance. process.
pay for goods. made.
XIII Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIV Credit Quality of the Company as well as Its Controlling Shareholder and Actual
Controller
□ Applicable √ Not applicable
XV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures
for Employees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVI Major Related-Party Transactions
1. Continuing Related-Party Transactions
√ Applicable □ Not applicable
67
Konka Group Co., Ltd. Annual Report 2020
As % Obtain
of Appro Over able Index
Relati Tra Met
Total total ved the marke to
onship Type Speci Prici nsa hod
value value transac appr t price Disclo discl
Related with of fic ng ctio of
(RM of all tion oved for sure osed
party the transa transa princ n settl
B’0,0 same- line line same-t date infor
Comp ction ction iple pric eme
00) type (RMB’ or ype matio
any e nt
transa 0,000) not transa n
ctions ctions
OCT Purch
Under
Enterprise ase of Purch Neg Mar
the 22
comm
s Co., Ltd same ase of otiat ket 5,497. Cas
oditie 0.54 5,500 Not N/A April http:/
and its actual mater ed pric 07 h
s and 2020 /ww
subsidiarie control ials price e
servic w.cni
s ler
es nfo.c
OCT Sales om.c
Under
of n/ne
Enterprise the Neg Mar
goods Sales 22 w/ind
s Co., Ltd same otiat ket 1,852. Cas
and of 0.13 20,000 Not N/A April ex
and its actual ed pric 41 h
servic LCD 2020
subsidiarie control price e
es
s ler
7,349.
Total -- -- -- 25,500 -- -- -- -- --
48
Large-amount sales return in detail N/A
The Company has published the Forecasting Public Notice on Routine Related-party
Transaction for Y2020 on Securities Times, Shanghai Securities News, China Securities
Journal as well as the Internet website designated by CSRC
Give the actual situation in the http://www.cninfo.com.cn/new/index on 22 April 2020. The Company held the
Reporting Period (if any) where an 36th Meeting of the 9th Board of Directors on 15 December 2020, on which the Proposal
estimate had been made for the total on Increase in Limit of 2020 Routine Related-party Transaction for Y2020 was
value of continuing related-party reviewed and approved. The Company was agreed to increase the quota of routine
transactions by type to occur in the related-party transactions for 2020 regarding purchasing services and products from
Reporting Period OCT Enterprises Co., Ltd and its subsidiaries with an increase of RMB25 million.
During the Reporting Period, the basis for pricing, transaction price, transaction amount
and settlement methods of raw materials purchased by the Company were basically in
accordance with the forecast. The total amount was RMB73.4948 million.
Reason for any significant difference
between the transaction price and the N/A
market reference price
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
√Applicable □ Not applicable
68
Konka Group Co., Ltd. Annual Report 2020
Refer to Part V -5. Other Major Related-Party Transactions for details.
3. Related Transactions Regarding Joint Investments in Third Parties
√Applicable □ Not applicable
Refer to Part V -5. Other Major Related-Party Transactions for details.
4. Credits and Liabilities with Related Parties
√ Applicable □ Not applicable
Indicate by tick mark whether there were any credits and liabilities with related parties for
non-operating purposes.
√ Yes □ No
Credits receivable with related parties:
Whether
Increased Recovere Interest in
there is Beginni
in the d in the the Ending
Related occupation ng Intere
Forming Reporting Reporting Reporting balance
Related party relation on balance st
reason Period Period Period (RMB’0,0
ship non-operati (RMB’ rate
(RMB’0,00 (RMB’0,0 (RMB’0, 00)
ng capital or 0,000)
0) 00) 000)
not
Subsidi
Demand
Yibin OCT ary of
of
Sanjiang controlli 5.70
business No 10,000 0 2,500 572.77 7,500.00
Properties ng %
develop
Co., Ltd. sharehol
ment
der
Chuzhou Subsidi
Demand
Kangjin ary of
of
Health controlli 7.00
business No 5,880 11,270.00 1,065.26 993.00
Industry ng % 16,084.74
develop
Development sharehol
ment
Co., Ltd. der
Effects of credits with
related parties on the No effect to the normal operation of the Company. Other shareholders of Yibin OCT Sanjiang
Company’s operating Properties Co., Ltd. and Chuzhou Kangjin Health Industry Development Co., Ltd. offer financial
results and financial assistance under the same conditions in accordance to their shareholding ratio.
conditions
Liabilities payable with related parties:
Increased Recovered Interest in
Beginning Ending
Related in the in the the
Related Forming balance Interest balance
relationshi Reporting Reporting Reporting
party reason (RMB’0,0 rate (RMB’0,00
p Period Period Period
00) 0)
(RMB’0,0 (RMB’0,0 (RMB’0,0
69
Konka Group Co., Ltd. Annual Report 2020
00) 00) 00)
150,000.00 150,000.00 4.06% 2,926.58 -
90,000.00 90,000.00 3.93% 2,359.22 -
The
Controllin 93,406.00 93,406.00 4.14% 1,904.75 -
OCT Company
g
Enterprises applies 50,000.00 47,594.00 4.56% 226.85 2,406.00
shareholde
Co., Ltd. entrusted
r
loan to it 50,000.00 41,300.00 4.56% 269.58 8,700.00
60,000.00 60,000.00 4.56% 240.22 -
50,000.00 4.22% 146.53 50,000.00
Effects of liabilities with
related parties on the
The Company applies entrusted loan from OCT Enterprises Co., Ltd. which meets the needs of the
Company’s operating
company's existing business development and reduces the financing cost.
results and financial
conditions
5. Other Major Related-Party Transactions
√ Applicable □ Not applicable
(1) Transferring 34% equity of Nanjing K-Star Science and Technology Industry Park Operation
and Management Co., Ltd.: At the Twenty-Eighth Meeting of the Ninth Session of the Board of
Directors on 5 June 2020 and the First Extraordinary General Meeting of 2020 on 22 June 2020, the
Company considered and approved the Proposal on the Transfer of 34% Equity of Nanjing K-Star
Science and Technology Industry Park Operation and Management Co., Ltd.. According to the
decision, the Company would transfer to Shenzhen Konka Holdings Group Co., Ltd. 34% equity of
Nanjing K-Star it held through non-disclosure agreement at a price of RMB470,986,500. As of now,
the Company has received all equity transfer payments and shareholders’ borrowings, and the
administrative procedures for changes in the business registration of Nanjing K-Star Science and
Technology Industry Park Operation and Management Co., Ltd. have been completed.
(2) Transferring some patents in relation to cloud big data operations: At the Twenty-Ninth Meeting
of the Ninth Session of the Board of Directors on 23 June 2020, the Company considered and
approved the Proposal on the Transfer of Some Patents in Relation to Cloud Big Data. According to
the decision, the Company would transfer to Shenzhen Konka Holdings Group Co., Ltd. 68 patents
in relation to cloud big data at a price of RMB98,600,000. As of now, the Company has received the
patent transfer payment from Shenzhen Konka Holdings Group Co., Ltd., and the administrative
procedures for changes in the registration of patentee have been completed.
(3) Initiating the establishment of Wuzhen Jiayu Digital Economy Industry Fund: At the
Twenty-Fourth Meeting of the Ninth Session of the Board of Directors on 27 March 2020 and the
Annual General Meeting of 2019 on 18 May 2020, the Company considered and approved the
Proposal on Initiating the Establishment of Wuzhen Jiayu Digital Economy Industry Fund.
According to the decision, the Company (or its wholly-owned subsidiary) would contribute a capital
70
Konka Group Co., Ltd. Annual Report 2020
of no more than RMB200 million as a limited partner to initiate the establishment of Wuzhen Jiayu
Digital Economy Industry Fund of no more than RMB500 million together with the cooperator. As
of now, business registration and filing with Asset Management Association of China for the Fund
has been completed.
(4) Signing with the subscription object a termination contract for the share subscription agreement
with conditional entry into force: At the Twenty-Seventh Meeting of the Ninth Session of the Board
of Directors and the Eighth Meeting of the Ninth Session of the Board of Supervisors on 22 May
2020, the Company considered and approved the Proposal on the Company Signing with the
Subscription Object a ‘Termination Contract for the Share Subscription Agreement with
Conditional Entry into Force’. It was agreed that the Company would sign the Termination
Contract for the Share Subscription Agreement with Conditional Entry into Force with Shenzhen
Overseas Chinese Town Capital Investment Management Co., Ltd. (hereinafter referred to as “OCT
Capital”), a wholly-owned subsidiary of OCT Group. As of now, the Company has entered into the
Termination Contract for the Share Subscription Agreement with Conditional Entry into Force,
specifying the termination of the Agreement for the Subscription of Non-Public Offering of Stock
with Conditional Entry into Force signed by and between the Company and OCT Capital on 28
March 2019.
(5) Providing advertising services to OCT Group: At the Twenty-Eighth Meeting of the Ninth
Session of the Board of Directors on 5 June 2020, the Company considered and approved the
Proposal on Providing Advertising Services to OCT Group. According to the decision, the Company
would provide OCT Group with advertising services at intelligent terminals with a service
transaction price of RMB100 million.
(6) Transferring some patents in relation to IOT, smart health and UHD display terminals: On 17
July 2020 and 10 August 2020, AT the 30th Meeting of the 9th Board of Directors and the 2nd
Extraordinary General Meeting of 2020 on July 17, 2020 and 10 August 2020, the Company
considered and approved the Proposal on the Transferring Some Patents In Relation To IOT, Smart
Health and UHD Display Terminals. According to the decision, the Company would transfer to
Shenzhen Konka Holdings Group Co., Ltd. 67 patents in relation to cloud big data at a price of
RMB89,600,000. As of now, the Company has received the patent transfer payment from Shenzhen
Konka Holdings Group Co., Ltd., and the administrative procedures for changes in the registration
of patentee have been completed.
Index to the public announcements about the said related-party transactions disclosed
Title of public announcement Disclosure date Disclosure website
Proposal on Initiating the Establishment of Wuzhen Jiayu Digital Economy
28 March 2020 http://www.cninfo.co
Industry Fund and Related-party Transaction
m.cn/new/index
Announcement on the Company Signing with the Subscription Object a 23 May 2020
71
Konka Group Co., Ltd. Annual Report 2020
‘Termination Contract for the Share Subscription Agreement with Conditional
Entry into Force’ and Related-party Transaction
Announcement on Providing Advertising Services to OCT Group and
6 June 2020
Related-party Transaction
Announcement on the Transfer of 34% Equity of Nanjing K-Star Science and
Technology Industry Park Operation and Management Co., Ltd. and 6 June 2020
Related-party Transaction
Announcement on the Transfer of Some Patents in Relation to Cloud Big Data
24 June 2020
and Related-party Transaction
Announcement on Completing Changes of Registration for the Transfer of 34%
Equity of Nanjing K-Star Science and Technology Industry Park Operation and 30 June 2020
Management Co., Ltd.
Announcement on Transferring Some Patents in relation to IOT, Smart Health
21 July 2020
and UHD Display Terminals and Related-party Transaction
XVII Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
√ Applicable □ Not applicable
Note to leases
No significant leases in the Reporting Period.
The rent of Konka Development Building has received RMB67.6924 million in the Reporting
Period.
The project bringing about gains or losses as over 10% of total profit in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major Guarantees
√ Applicable □ Not applicable
(1) Guarantees
Unit: RMB'0,000
Guarantees provided by the Company and its subsidiaries for external parties (exclusive of those for subsidiaries)
Obligor Disclosure date of the Line of Actual occurrence Actual Type of Term Havi Guarante
72
Konka Group Co., Ltd. Annual Report 2020
guarantee line guarante date guarantee guarantee of ng e for a
announcement e amount guara expir related
ntee ed or party or
not not
Yibin OCT
Sanjiang 3
19 September 2018 40,000 29 September 2019 14,000 Joint-liability Not Yes
Properties Co., years
Ltd.
Kunshan
Kangsheng
3
Investment 19 September 2018 24,500 23 September 2019 24,500 Joint-liability Not Yes
years
Development
Co., Ltd.
Jiangxi Xinxin
Jian’an
10,000 12 December 2016 10,000 Joint-liability Not Not
Engineering
Co., Ltd.
Jiangxi
Zhongyi
Decoration 10,000 12 December 2016 10,000 Joint-liability Not Not
Materials Co.,
Ltd.
Jiangxi
Shanshi
Technological 10,000 12 December 2016 10,000 Joint-liability Not Not
Development
Co., Ltd.
Total approved line for such guarantees in the Total actual amount of such guarantees in the
39,200 0
Reporting Period (A1) Reporting Period (A2)
Total approved line for such guarantees at the end of Total actual balance of such guarantees at the end of
133,700 68,500
the Reporting Period (A3) the Reporting Period (A4)
Guarantees provided between the Company and subsidiaries
Havi Guarante
Term
Disclosure date of the Line of Actual ng e for a
Actual occurrence Type of of
Obligor guarantee line guarante guarantee expir related
date guarantee guara
announcement e amount ed or party or
ntee
not not
1 August 2019 4,500 Joint-liability One Not Not
31 March 2017,
Anhui and a
23 May 2018 and 90,000
Tongchuang 25 December 2019 5,000 Joint-liability half Not Not
19 September 2018
years
73
Konka Group Co., Ltd. Annual Report 2020
1
13 January 2020 3,500 Joint-liability Not Not
year
1
5 November 2019 3,000 Joint-liability Not Not
year
1
11 March 2020 5,800 Joint-liability Not Not
year
1
6 August 2020 3,000 Joint-liability Not Not
year
1
19 October 2020 3,000 Joint-liability Not Not
year
1
6 March 2020 13,050 Joint-liability Not Not
Hong Kong 31 March 2017 and years
355,000
Konka 31 October 2018
1
28 December 2020 20,000 Joint-liability Not Not
year
2
20 February 2019 2,500 Joint-liability Not Not
Boluo Konka years
31 March 2018 5,000
Precision 3
19 August 2020 2,480 Joint-liability Not Not
years
1
24 July 2020 10,000 Joint-liability Not Not
year
16 November 202 1
50,000 Joint-liability Not Not
Electronics 0 year
19 September 2018 350,000
Technology 1
9 June 2020 6,000 Joint-liability Not Not
year
1
14 August 2020 8,000 Joint-liability Not Not
year
5
8 November 2019 2,000 Joint-liability Not Not
Dongguan years
19 September 2018 10,000
Konka 1
16 January 2020 3,000 Joint-liability Not Not
year
One
14 November 201 and a
Econ 5,000 Joint-liability Not Not
19 September 2018 120,000 9 half
Technology
years
29 April 2020 8,800 Joint-liability 1 Not Not
74
Konka Group Co., Ltd. Annual Report 2020
year
1
25 May 2020 5,000 Joint-liability Not Not
year
1
5 June 2020 24,000 Joint-liability Not Not
year
1
21 August 2020 5,000 Joint-liability Not Not
year
22 September 202 1
5,000 Joint-liability Not Not
0 year
12 November 202 2
5,800 Joint-liability Not Not
XingDa 0 years
19 September 2018 10,000
HongYe 3
25 December 2020 2,000 Joint-liability Not Not
years
2
18 March 2019 11,961 Joint-liability Not Not
years
1
28 June 2020 6,000 Joint-liability Not Not
year
3
26 June 2019 5,500 Joint-liability Not Not
years
3
30 October 2019 6,500 Joint-liability Not Not
years
2
20 March 2020 990 Joint-liability Not Not
years
Jiangxi Konka 31 October 2018 60,000
1
4 August 2020 3,000 Joint-liability Not Not
year
29 September 202 3
10,000 Joint-liability Not Not
0 years
3
30 December 2020 1,000 Joint-liability Not Not
years
3
6 November 2020 10,000 Joint-liability Not Not
years
2
21 December 2020 5,000 Joint-liability Not Not
years
Sichuan 3
31 March 2018 55,000 18 March 2019 4,000 Joint-liability Not Not
Konka years
Pengrun 1
19 September 2018 20,000 25 August 2020 5,000 Joint-liability Not Not
Technology year
Xinfeng 3
30 March 2019 25,000 19 May 2020 5,000 Joint-liability Not Not
Microcrystalli years
75
Konka Group Co., Ltd. Annual Report 2020
ne 2
29 May 2020 3,479 Joint-liability Not Not
years
1
18 June 2020 7,200 Joint-liability Not Not
year
3
8 December 2020 2,100 Joint-liability Not Not
years
1
28 December 2020 7,200 Joint-liability Not Not
year
26 June 2019 3
10,000 Joint-liability Not Not
years
20 December 2019 3
5,000 Joint-liability Not Not
years
3
8 January 2020 5,000 Joint-liability Not Not
years
2
Nano 8 January 2020 5,000 Joint-liability Not Not
years
Crystallized 30 March 2019 45,000
2
Glass 20 March 2020 990 Joint-liability Not Not
years
2
29 May 2020 5,975 Joint-liability Not Not
years
1
24 June 2020 7,000 Joint-liability Not Not
year
3
14 July 2020 6,000 Joint-liability Not Not
years
Ningbo 1
6 June 2020 180,000 27 July 2020 6,000 Joint-liability Not Not
Kanghanrui year
4
Yibin Kangrun 24 October 2020 10,000 13 November 2020 10,000 Joint-liability Not Not
years
Telecommunic
1
ation 31 March 2017 50,000 26 August 2020 7,500 Joint-liability Not Not
year
Technology
1
25 November 2020 10,000 Joint-liability Not Not
year
Anhui Konka 31 March 2017 110,000
1
24 December 2020 26,800 Joint-liability Not Not
year
Total approved line for such guarantees in the Reporting Total actual amount of such guarantees in the
48,000 409,073
Period (B1) Reporting Period (B2)
Total approved line for such guarantees at the end of the Total actual balance of such guarantees at the
1,981,504 404,625
Reporting Period (B3) end of the Reporting Period (B4)
76
Konka Group Co., Ltd. Annual Report 2020
Guarantees provided between subsidiaries
Havi Guarante
Term
Disclosure date of the Line of Actual ng e for a
Actual occurrence Type of of
Obligor guarantee line guarante guarantee expir related
date guarantee guara
announcement e amount ed or party or
ntee
not not
Sichuan 7
14,000 28 May 2018 14,000 Joint-liability Not Not
Konka years
Rushan Yike
Water
10
Environment 29,000 29 December 2016 29,000 Joint-liability Not Not
years
Management
Co., Ltd.
Wuhan
Runyuan
20
Wastewater 21 January 2020 55,200 20 January 2020 55,200 Joint-liability Not Not
years
Treatment Co.,
Ltd.
Subei Mongol
Autonomous
15
County 24 March 2020 77,600 10 March 2020 77,600 Joint-liability Not Not
years
Kangrun Water
Co., Ltd.
Dayi Kangrun
15
Water Co., 13 May 2020 27,400 29 April 2020 27,400 Joint-liability Not Not
years
Ltd.
Xi’an Gaoling
Kangrun
15
Environmental 17 December 2020 24,571 17 December 2020 24,571 Joint-liability Not Not
years
Engineering
Co., Ltd.
Total approved line for such guarantees in the Reporting Total actual amount of such guarantees in the
202,771 184,771
Period (C1) Reporting Period (C2)
Total approved line for such guarantees at the end of the Total actual balance of such guarantees at the
227,771 227,771
Reporting Period (C3) end of the Reporting Period (C4)
Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line approved in the Reporting Period Total actual guarantee amount in the Reporting
289,971 593,844
(A1+B1+C1) Period (A2+B2+C2)
Total approved guarantee line at the end of the Reporting Total actual guarantee balance at the end of the
2,342,975 700,896
Period (A3+B3+C3) Reporting Period (A4+B4+C4)
77
Konka Group Co., Ltd. Annual Report 2020
Total actual guarantee amount (A4+B4+C4) as % of the
83.16%
Company’s net assets
Of which:
Balance of guarantees provided for shareholders, actual controller and their related parties (D) 38,500
Balance of debt guarantees provided directly or indirectly for obligors with an over 70% debt/asset
648,096
ratio (E)
Amount by which the total guarantee amount exceeds 50% of the Company’s net assets (F) 279,464
Total of the three amounts above (D+E+F) 700,896
Joint responsibilities possibly borne in the Reporting Period for undue guarantees (if any) N/A
Provision of external guarantees in breach of the prescribed procedures (if any) N/A
Compound guarantees:
None
(2) Irregularities in Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
√ Applicable □ Not applicable
Overview of cash entrusted for wealth management
Unit: RMB'0,000
Type Capital resource Amount Outstanding balance Overdue amount
Bank financial
Self-owned funds 63,916.00 61,824.95 0
products
Total 63,916.00 61,824.95 0
High-risk entrusted asset management with significant single amount or low security, poor liquidity
and no capital preservation:
□ Applicable √ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case which
may cause impairment for entrusted asset management
□ Applicable √ Not applicable
(2) Entrusted Loans
√ Applicable □ Not applicable
Overview of entrusted loans
Unit: RMB'0,000
Total amount Capital resource Outstanding amount Overdue amount
2,000 Self-owned funds 0 0
78
Konka Group Co., Ltd. Annual Report 2020
High-risk entrusted loans with significant single amount or low security, poor liquidity and no
capital preservation:
□ Applicable √ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case which
may cause impairment for entrusted loans
□ Applicable √ Not applicable
4. Major Routine Contracts
□ Applicable √ Not applicable
5. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVIII Corporate Social Responsibility (CSR)
1. Measures Taken to Fulfill CSR Commitment
The Company insists the principle of health, stability and sustainable development to benefit
shareholders and employees and satisfy customers. In pursuit of economic profits and protection of
shareholders’ profits, the Company is active in protecting legal rights of debtors and employees,
treating suppliers, customers and consumers in good faith, and participating in environmental
protection and community establishment for harmonious development of the Company and society.
1. To protect rights of shareholders and creditors
(1) The Company protects rights of shareholders
The Company insists protection of rights for all shareholders, especially equal status and legal
rights for medium and small shareholders, and make insurance of rights to be informed,
participation and vote.
The Company would perform all obligations of information disclosure to ensure timely, accurate
and complete information and strictly execute confidential system of registrar and insider
information to guarantee justice.
The Company pays attention to repay to shareholders, and insists mutual development with
investors. In the previous three years, the Company shares dividends with all shareholders. The
Company strict executes dividend policies regulated in Articles of Association. All cash dividends
comply with regulations in Articles of Association and requirements in shareholders’ conference.
(2) The Company protects rights of creditors
In full consideration of legal rights of creditors, the Company complies with strict business rules of
credit cooperation to guarantee legal rights of creditors. No damages upon rights of creditors
happened.
2. The Company performs responsibilities to suppliers and customers
(1) It is devoted to improve customer service quality.
79
Konka Group Co., Ltd. Annual Report 2020
The Company is insisting philosophy of customer orientation to strengthen customer service
management, service consciousness for employees, service levels and to protect rights for
customers. Through customer service hot-line, field visit and follow-up service, the Company has
set a good corporate image for customers.
(2) Be honest to suppliers
Following the principle of integrity and mutually beneficial cooperation, the Company keeps good
cooperative relations with suppliers at each level. The corporate principle is open, fair and impartial
to standardize procurement, protect suppliers’ legal rights and lay solid foundation for further
cooperation.
3. Be enthusiastic to social and public welfare undertakings
Based on the principle of appreciating and repaying the society, the Company has participated in all
kinds of activities for public welfare, cooperated with society, undertaken social responsibilities
actively and promoted harmonious development between enterprise and society.
4. Be responsible for employees
The Company insists the principle of people orientation to improve working environment, promote
occupational skills, provide opportunity and platform for development and growth and encourage
self upgradation and realization for employees. Mutual improvement for employees and enterprise
could be achieved.
(1) Be honest and law-abiding to protect legal rights for employees
The Company would strictly comply with laws and regulations in Labor Law and Labor Contract
Law to sign labor contract with employees with fair treatment in employment, payment, promotion,
training, demission and retirement. Also, the Company would pay all kinds of insurances and
housing fund for employees. Regular physical examination would be organized for each year. Any
problems found would require re-examination and consultation from a doctor.
The Company would improve living quality; enhance cohesive force and sense of belongings
through a series of safeguard measures.
(2) To protect occupational health for employees
The Company would establish and perfect training, safety assessment by security system to
guarantee the safety and occupational health for employees. On the other hand, by promotion of the
importance of safety, safety awareness would be rooted in the heart to make all employees abide by
safety standards and fully play subjective initiative in protecting self-occupational safety and
production safety.
(3) To promote occupational skills by diversified professional training
The Company has always paid great attention on diversified training for employees. On the one
hand, the Company would be meticulous in training of regular business and occupational skills and
carry out all requirements positively to improve professional levels by normal training management.
80
Konka Group Co., Ltd. Annual Report 2020
On the other hand, the Company would establish methods of self-training platform, training
instructor, theme training and lectures to provide colorful training activities. Besides the work,
professional and comprehensive quality would be fully promoted.
5. Be responsible for environment
The Company concerns about environmental changes and close relationships with environment by
creating low carbon economy in technical innovation, from green manufacturing, green products to
green industry circular economy. The Company would provide efforts in protecting global
ecological environment. In June 2012, subsidized products catalogue had been released jointly by
National Development and Reform Commission, Ministry of Industry and Information and Ministry
of Finance.
In the new year, the Company would undertake all social responsibilities by improving strategic
management, sustainable development and enterprise economic efficiency. It would reattribute all
shareholders and would protect legal rights for creditors and employees. To be honest to suppliers
and customers, the Company would serve local economic development and participate in social
public welfare activities and environment protection. It would undertake all responsibilities in many
fields and make attributions to social, economic, and environmental sustainable development for a
socialism harmonious society.
2. Measures Taken for Targeted Poverty Alleviation
(1) Plans
In accordance with the guiding principles of the state on the development of precision poverty
alleviation, the Company has proactively carried out critical work on poverty alleviation and
engaged in the targeted support in Sansui County and Tianzhu County in Guizhou Province.
(2) Summary of the Related Work Done in the Reporting Period
In 2020, the Company donated money to and purchased agricultural products from Sansui County
and Tianzhu County in Guizhou Province with a total of RMB1.2 million.
(3) Results of Targeted Poverty Alleviation
Unit of
Index Amount/implementation
measurement
I. Overall situation —— ——
Of which: 1. Money RMB’0,000 120
II. Itemized investment —— ——
9. Other plans —— ——
Of which: 9.2 Investment amount RMB’0,000 120
(4) Subsequent Plans
To fully perform its duties of targeted poverty alleviation, in 2021, the Company plans to
continuously conduct the targeted poverty alleviation affairs for Tianzhu and Sansui two counties of
Guizhou Province.
81
Konka Group Co., Ltd. Annual Report 2020
3. Issues Related to Environmental Protection
Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major
polluter by the environmental protection authorities.
√ Yes □ No
Nu
mbe
Way Distribu Exce
r of
Name of of tion of Discharge Total ssive
Name of disc Discharge Approved total
major disc dischar standards discha disc
polluter harg concentration discharge
pollutants harg ge implemented rge harg
e
e outlets e
outl
ets
Pollution
sources of
PH 6-9; total
waste
copper≤0.3mg/L;
water: PH,
COD≤50mg/L;
total Total discharge
ammonia
copper, 448,500
nitrogen≤8mg/L;
COD, Disc tons/year;
total
ammonia n harg pollutant COD
Main nitrogen≤15mg/L;
itrogen, e of 19.061250
dischar total 0.448
total stati GB 21900-2008 tons/year;
ge phosphorus≤0.5m 5
nitrogen, onar Discharge ammonia nitro
outlet g/L; total millio Non
total y 1 Standard For gen 3.0498
of the cyanide≤0.2mg/L; n e
phosphorus poll Pollutants From tons/year; total
waste total tons/y
, total utio Electroplating nitrogen
water nickel≤0.1mg/L; ear
cyanide, n 32.9792
XingDa station total iron≤2mg/L;
total sour tons/year; total
HongYe total
nickel, ces phosphorus
aluminum≤2mg/L
total iron, 0.2082
;
total tons/year
petroleum≤2mg/L
aluminum,
; suspended
petroleum,
solids≤30mg/L
suspended
solids
waste gas Disc Three sulfuric acid Emission Standard Total
2,986,
pollutants: harg on the fume≤30mg/m3; for Electroplating discharge:
560,0
sulfuric e of roof of nitrogen Pollutants 2,986,560,000
00
acid fume, stati plant 1, oxide≤200mg/m3; GB21900-2008 standard Non
14 standa
hydrogen onar ten on hydrogen Air Emission cube/year e
rd
chloride, y the roof chloride≤30mg/m Limits Table 5, (note: the total
cube/y
formaldehy poll of plant 3; hydrogen Emission standard discharge is
ear
de, utio 2 and cyanide≤0.5mg/m of Volatile not stated in
82
Konka Group Co., Ltd. Annual Report 2020
hydrogen n one on 3; Organic the latest
cyanide, sour the roof TVOC≤90mg/m3; Compounds for version of
nitrogen ces of the benzene≤1mg/m3; Printing Industry national
oxide, canteen toluene+xylene≤1 DB44/815-2010; discharge
ammonia, 5mg/m3; tin and Guangdong Air permit in 2021;
benzene, its Pollutant two exhaust
toluene+xy compounds≤8.5m Emission Standard towers were
lene, g/m3; DB44/27-2001 the added in 2021;
TVOC, tin PM(dust)≤120mg/ Second Level calculated
and its m3 Standard in the based on air
compounds Second Period, volume in
, PM(dust) Emission standard environmental
for Odor impact
Pollutants (GB assessment)
14554-1993)
Table 2 Standard
1. Discharge
standard of
1. Emission
discharge permit:
standard for
Discharge
pollution
Standard of
discharge
Electroplating
certificate:
Water Pollutant Total discharge
copper≤0.5mg/L;
for Electroplating amount is
COD≤80mg/L;
DB44/1597-2015 318,300
Wastewate Disc ammonia
Table 1 Pearl 318,3 tons/year;
r pollution: harg nitrogen≤15mg/L;
Main River Delta 00 COD is 25.464
Boluo PH, e of total
dischar Discharge tons/y tons/year;
Konka copper, stati nitrogen≤20mg/L;
ge Standard; 2. Local ear ammonia
and COD, onar total
outlet discharge Note: nitrogen is Non
Boluo ammonia y 1 phosphorus≤1mg/
of the standard: BFBH accord 4.775 e
Konka nitrogen, poll L; 2. local
waste [2019] No. 58 ing to tons/year; total
Precisio total utio emission
water Document: COD, discha nitrogen is 4.8
n nitrogen, n standard:
station ammonia nitrogen, rge tons/year.
total sour copper≤0.5mg /L;
total phosphorus permit Note:
phosphorus ces COD≤30mg/L;
based on according to
ammonia
"Environmental the discharge
nitrogen≤1.5mg/L
Quality Standards certificate
; total
for Surface Water
nitrogen≤10mg/L;
GB3838-2002 "
total
Category IV water
phosphorus≤0.3m
standard, the total
g/L
nitrogen discharge
reaches 50% of
83
Konka Group Co., Ltd. Annual Report 2020
discharge limit
requirement of the
corresponding
industry
waste
Emission Standard
gas polluta sulfuric acid
for Electroplating
nts: fume≤30mg/m3；
Pollutants
sulfuric nitrogen
GB21900-2008
acid fume, oxide≤200mg/m3
Air Emission
hydrogen Six on ；hydrogen
Disc Limits Table 5,
chloride, the roof chloride≤30mg/m
harg Guangdong Air
formaldehy of plant 3； The total
e of Pollutant
de,hydroge 1, TVOC≤90mg/m3 discharge is
stati Emission Standard
n cyanide, thirteen ； not stated in
onar DB44/27-2001 the
nitrogen on the benzene≤12mg/m the latest Non
y 20 Second Level /
oxide, roof of 3； version of e
poll Standard in the
ammonia, plant 2 methylbenzen≤40 national
utio Second Period,
benzene, and one mg/m3； discharge
n Emission standard
methylben in dimethylbenzene≤ permit in 2020
sour for Odor
zene, sewage 70mg/m3；tin and
ces Pollutants (GB
TVOC, tin station its
14554-1993)
and its compounds≤8.5m
Table 2 Standard,
compounds g/m3；PM（dust）
Emission standard
, PM ≤120mg/m3；oil
of cooking fume
(dust), oil fume≤2mg/m3
(GB18483-2001)
fume
The construction of anti-pollution facilities and its operation situation
① XingDa HongYe
All production equipment of Guangdong Xingda Hongye Electronics Co., Ltd. has been set up with
supporting environmental protection facilities according to the requirements of environmental
impact assessment. The discharge of wastewater, waste gas and noise as well as the disposal of all
solid wastes in the Company all met the standards during the Reporting Period.
The sewage treatment centre of Guangdong Xingda Hongye Electronics Co., Ltd. with an
investment of about RMB15 million was formally put into production in June 2007, and the
treatment capacity of the sewage treatment facility was 2,566 tons/day. After technical improvement
and expansion, the capacity increased to 2,900 tons/day with the treatment process remaining
unchanged. Currently, the sewage treatment facilities are functioning well and the main pollutant
discharge meets the discharge standards and environmental assessment standards. The pollutants are
discharged to Fushachong after being treated at the self-built sewage treatment station.
② Boluo Konka and Boluo Konka Precision
All production equipment of Boluo Konka and Boluo Konka Precision has been reported for
environmental assessment, review and approval. The supporting environmental protection and
pollution control facilities have been designed by pollutant type and concentration and effectively
operated in a targeted manner. During the Reporting Period, the discharge standards were met in
84
Konka Group Co., Ltd. Annual Report 2020
terms of industrial waste water, exhaust and factory noise, and all industrial waste generated was
disposed of in compliance with environmental laws and regulations.
Boluo Konka was established in 2000. To manufacture single sided PCBs, it invested approximately
RMB 5 million in constructing a sewage treatment station without the biochemical treatment
function and featuring a discharge capacity of 300 tons per day. In 2007, Boluo Konka expanded its
factory by starting the Phase II project, which was submitted for environmental assessment as
Boluo Konka PCB Double Sided and Multi-Layer PCB Project (later the project owner was
changed into Boluo Konka Precision). It spent about RMB 10 million on constructing the Phase II
sewage treatment station to add the biochemical treatment function with a discharge capacity of 800
tons per day.
In 2019, according to the requirements in the documents issued by Boluo County Ecology and
Environment Bureau, the two sewage treatment stations of Boluo Konka and Boluo Konka
Precision must be upgraded towards higher standards. Through comprehensive assessment of the
professional environmental protection company, it was decided that the sewage treatment stations of
the said companies be combined to meet the upgrading requirements. Boluo County Ecology and
Environment Bureau approved the combination of the discharge outlets of the aforementioned
companies, and Boluo Konka would appoint Boluo Konka Precision to treat sewage. After the
combination, the discharge capacity would reach 1,100 tons per day. The aforementioned
companies spent about RMB 20 million between 2019 and 2020 on upgrading the sewage treatment
stations towards higher standards, and added industrial advanced processes and treatment systems,
such as RO water treatment, Fenton oxidation and MBR films. After the technological
improvements and expansion, the sewage treatment reaches 2,200 tons per day (with a discharge
capacity of 1,100 tons per day) with a reuse rate of more than 60%. At present, the waste water
treatment facilities are operating in good conditions; the discharge of major pollutants meets the
discharge standards. After advanced treatment of the water reuse facilities, the water treated by the
sewage stations that meets the standards will be reused in the plants, while the remaining water will
be discharged to the municipal pipe network to be processed by the urban and rural water treatment
factory before being discharged to the Dongjiang River.
Environmental impact assessment and other environmental protection administrative licenses of the
construction project
① XingDa HongYe
Guangdong Xingda Hongye Electronics Co., Ltd. obtained the approval from Zhongshan
Environmental Protection Bureau (ZHJ [2004] No. 61) for the operations and construction here in
2004. Subsequently, it obtained the documents of ZHJD [2008] No. 06250 and ZHJD [2010] No.
04469 respectively in 2008 and 2010. After the operations of its original project, Guangdong
Xingda Hongye Electronics Co., Ltd. passed the two phases of acceptance assessment, including the
Phase I acceptance assessment in 2008 (HY [2008] No. 02) and the Phase II acceptance assessment
in 2012 (ZHYBG [2012] No. 000092).
In December 2012, Guangdong Xingda Hongye Electronics Co., Ltd. commissioned Zhongshan
Research Institute of Environmental Protection Science to conduct the assessment of environmental
impact for the technical improvement and expansion project of Guangdong Xingda Hongye
Electronics Co., Ltd. On 31 December 2012, it obtained the approval document titled Reply to the
Report on the Environmental Impact of the Technical Improvement and Expansion Project of
Guangdong Xingda Hongye Electronics Co., Ltd. (ZHJS (2012) No. 115) from Zhongshan
85
Konka Group Co., Ltd. Annual Report 2020
Environmental Protection Bureau. The document granted the approval for addition of the
production of six-layer PCB, eight-layer PCB and above and HDI boards and for reduction of the
production of single-sided PCB. After the technical improvement and expansion, the total
production capacity of single-sided PCB would be 200,000 m2/year, of double-sided PCB would be
250,000 m2/year, of four-layer PCB would be 300,000 m2/year, of six-layer PCB would be 200,000
m2/year, of eight-layer PCB and above would be 150,000 m2/year and of HDI boards would be
100,000 m2/year. In the project, while the original plating equipment and processes remained
unchanged, the brown oxide process was added to the original production process; all the increased
plating capacity would be outsourced. The technical improvement and expansion project was
commenced in 2013 and completed in January 2018. The commissioning was carried out from 10
February 2018 to 8 July 2018. The construction of the project complied with the requirements for
environmental impact assessment and met the criteria for the acceptance of environmental
protection for the completion of construction projects. In 2021, the Company renewed/changed the
state sewage permit, certificate No.: 91442000768405216J001P.
②Boluo Konka and Boluo Konka Precision
In 2000, Boluo Konka obtained the approval from the Huizhou Municipal Ecology and
Environment Bureau (HSHJ [2000] No. 23). The project was completed and put into operation in
the same year. The pollutant discharge permit No. is 91441322721121283N001U.
In January 2007, Boluo Konka appointed Huizhou Institute of Environmental Sciences to conduct
the environmental impact assessement of the Boluo Konka Expansion Project. On February 8, 2007,
Boluo Konka received the Document of Approval for the Environmental Impact Report on the
Project of Boluo Konka Double Sided and Multi-Layer Boards (HSHJ [2007] No. J32). According
to the Document, approval was given to the addition of double sided and multi-layer circuit boards
in the project expansion. The production capacity for single sided circuit boards would reach 1
million square meters per year, and double sided and multi-layer circuit boards would reach
650,000 square meters per year after the project expansion. In addition, electroplating equipment
and process would be added in the expansion project. The construction of the project met the
environmental assessment requirements and satisfied the conditions for the environmental
protection in the project inspection and acceptance. The pollutant discharge permit was obtained in
the same year. The aforementioned project was later renamed as Boluo Konka Precision. In 2020,
Boluo Konka Precision obtained the national pollutant discharge permit with the permit No.
91441322799316208F001V.
Contingency plan for emergent environmental incident
① XingDa HongYe
In strict accordance with requirements of laws, regulations and relevant documents, such as Law of
the People’s Republic of China on Emergency Response and Interim Measures on Environmental
Emergency Response Plan, Guangdong Xingda Hongye Electronics Co., Ltd. has established risk
prevention measures and emergency response plans, kept its emergency equipment in a normal state,
formulated the Contingency Plan for Emergent Environmental Incident, and put on records at
Zhongshan Environmental Protection Bureau, Guangdong Province, record No.: 4420002017044M.
In addition, the Company conducts a drill of major environmental pollution incident on its factory
to enhance its emergency response capabilities for emergent environmental pollution incidents.
Furthermore, Guangdong Xingda Hongye Electronics Co., Ltd. has built an emergency pool (which
is the comprehensive water tank in the sewage treatment station covering an area of 800m3) and set
86
Konka Group Co., Ltd. Annual Report 2020
up a fire pool (500m3 and located on Floor 1 of Factory Building No. 2), which serve as temporary
storage pools for exterior drainage or fire drainage to eradicate accidental discharge of wastewater
in the case of failed operation of the sewage transmission pipeline or fire accident due to outage or
other special circumstances. The sewage transmission pipeline has been equipped with
anti-corrosion and cathodic protection using anti-corrosion pipes and carbon steel pipes. Pursuant to
the new discharge standards, the related discharge pipeline has been modified and the production
department has been required to discharge strictly in accordance with discharge standards to cut the
costs of wastewater treatment. Different types of wastewater are normally and properly treated
through fine shunting. Personnel have been specially arranged to manage the chemical liquid
warehouse and exert reasonable control and requirements over the liquid discharge by the plant and
timely transportation of the liquid by suppliers; emergency tools such as protective masks, boots
and immiscible pumps have been equipped.
② Boluo Konka and Boluo Konka Precision
Boluo Konka and Boluo Konka Precision strictly abides by Emergency Response Law of the
People's Republic of China, Interim Measures for the Management of Emergency Plans for
Unexpected Environmental Incidents, other related laws and regulations as well as the requirements
of relevant documents. They have established risk prevention measures and emergency plans, such
as Emergency Plan for Unexpected Environmental Incidents, and have their emergency equipment
run in a normal status. In addition, they have filed with Boluo County Branch of Ecology and
Environment Bureau in Huizhou, Guangdong and Huizhou Ecology and Environment Bureau
respectively with the file No. 441322-2020-0073-M and 441301-2021-004-M. They organize all
staff to conduct drills for major environmental pollution incidents every year to improve their
ability for the emergency response to unexpected environmental pollution incidents.
Boluo Konka and Boluo Konka Precision are well equipped with all necessary facilities for
emergency response to unexpected incidents, including an emergency response pool of industrial
waste water (500m3, under the ground of the sewage treatment station) and a firefighting reservoir
(300m3, located beside the staff dormitory building). In the event of an unexpected environmental
incident, such as leakage or failure of a waste water transporting pipe, the emergency response pool
will prevent any accident of industrial waste water; in the event of a fire safety accident, the
firefighting reservoir will be put into use. All departments are required to discharge pollutants
strictly in accordance with pollutant discharge standards to reduce the costs of waste water
treatment by properly and reasonably dividing solution and waste water discharged from the plants.
The chemical warehouses are managed by designated personnel, with standard control and
requirements over the loading and unloading of chemical products by suppliers. In terms of
emergency response supplies, a full set of emergency rescue tools are prepared, including gas masks,
acid and alkaline resistant boots, gloves, goggles, safety ropes, helmets, fire sand and submersible
pumps.
Environmental self-monitoring plan
① XingDa HongYe
According to the requirements of the Environmental Protection Administration, Xingda Hongye
attaches great importance to environmental monitoring management. Thus, pursuant to the
Measures for Self-Monitoring and Information Disclosure of National Key Monitored Enterprises,
the Report on the Environmental Impact of the Technical Improvement and Expansion Project of
Guangdong Xingda Hongye Electronics Co., Ltd. and the reply opinions for environmental impact
87
Konka Group Co., Ltd. Annual Report 2020
assessment, the Company has formulated the Environmental Self-Monitoring Plan and reported to
the municipal environmental protection bureau for approval and record. It implements online
monitoring for the PH, COD and ammonia nitrogen pollutants discharged in wastewater through
real-time monitoring and an automatic frequency of every two hours, entrusts the qualified
third-party online monitoring equipment operation and maintenance institute to carry out periodic
maintenance on automatic monitoring equipment and monitoring data networking equipment, and
entrusts the qualified third-party monitoring unit to carry out the “three wastes” project monitoring.
All self-monitoring plan results will be reported and disclosed on public platforms on a periodic
basis.
In the case of normal production, the results will be updated on a daily basis, with online
monitoring data disclosed in real time and manual monitoring data disclosed on the Real time
publicity or every 2 hours after completion. Items monitored on a monthly basis will be disclosed
by the 10th day of the month. In the case of public holidays, the operation monitoring data for the
holiday period will be disclosed on the first working day after the holiday. The annual
self-monitoring report for the previous year will be disclosed at the end of January each year. In the
case of shutdown with days off, the number of days off will be indicated in the information bar and
related proofs will be submitted to the monitoring center of the municipal environmental bureau for
record. The results are disclosed on Guangdong Province Key Pollution Source Regulatory
Information Platform and on National Pollution Source Monitoring Information Management and
Sharing Platform for public monitoring.
②Boluo Konka and Boluo Konka Precision
In line with the requirements of environmental departments, Boluo Konka and Boluo Konka
Precision attach great importance to environmental monitoring and management. Based on the
Measures for the Self-Monitoring and Information Publicity of Enterprises under National Key
Monitoring, Environmental Impact Report and the opinions stated in reply to the environmental
assessment, they have established the Environmental Self-Monitoring Plan of Enterprises and filed
a record with the municipal ecology and environment bureau. According to the plan, they have
installed an online monitoring system to monitor the PH value, total flow, COD, ammonia nitrogen
and total phosphorus of the waste water, and networked with the ecology and environment bureau.
They appoint a qualified third-party online monitoring equipment operation and maintenance
organization to perform regular maintenance of the automatic monitoring equipment and the
monitoring data networking equipment, and a qualified third-party monitoring organization to
perform the monitoring of the “three wastes”. All self-monitoring results will be reported and
published on public platforms and subject to public monitoring.
Other environmental information that should be disclosed
①XingDa HongYe
The environmental protection investment of Guangdong Xingda Hongye Electronics Co., Ltd. for
2020 was approximately RMB10.85 million, mainly used as the environmental engineering
investment (approximately RMB4.5 million) and the operation of environmental protection
equipment (approximately RMB6.35 million).
② Boluo Konka and Boluo Konka Precision
Boluo Konka and Boluo Konka Precision invested RMB20 million on environmental protection in
2020 in total, including RMB17.1 million used in environmental protection projects (RMB12.85
million for wastewater station upgrading, RMB1.45 million for phase II waste gas treatment project,
88
Konka Group Co., Ltd. Annual Report 2020
RMB1.85 million for overhead pipe network, RMB750,000 for expansion of solid waste warehouse
and RMB200,000 for other minor projects) and RMB2.9 million used in operation of environmental
protection treatment facilities.
Other Environmental Information
According to the examination by the Company, the Company and its other holding subsidiaries are
not key pollutant units. All have faithfully implemented the laws and regulations related to
environmental protection, such as Environmental Protection Law of the People's Republic of China,
Water Pollution Prevention and Control Law of the People's Republic of China, Law of the People's
Republic of China on the Prevention and Control of Atmospheric Pollution, Law of the People's
Republic of China on Prevention and Control of Pollution From Environmental Noise, Law of the
People's Republic of China on the Prevention and Control of Environmental Pollution by Solid
Waste in the daily production and operation, without being punished for violations of laws and
regulations during the Reporting Period.
XIX Other Significant Events
√ Applicable □ Not applicable
(I) Private placement of corporate bonds: as for the private placement of corporate bonds of
RMB2.3 billion, currently, RMB1 billion of corporate bonds have been issued successfully on 8
January 2021, and the rest corporate bonds of RMB1.3 billion and the corporate bond business of
RMB0.6 billion are in moving forward.
(II) Private placement of A-shares: CSRC has terminated its review on the Company’s private
placement of A-shares at the request of the Company.
(III) Launch and establishment of the fund: Currently, Orient Konka Industry M&A Fund
respectively holds 7.26%, 2.07%, 11.73%, 9.21%, 3.00%, and 3.84% equity interest in Jiangxi
Yahua Electronic Materials Co., Ltd., Genew Technologies Co., Ltd., Shenzhen Grentech RF
Communication Co., Ltd., Huizhou Xuxin Intelligent Technology Co., Ltd., Yimeide Automation
Technology Co., Ltd., Gma Optoelectronic Technology Co., Ltd. Wuzhen Jiayu Digital Economy
Industry Fund holds 12.00% equity interest in Flying Science And Technology (Shenzhen) Co., Ltd.
Yibin Kanghui Emerging Industry Fund and Konka Yancheng Electronic Information Industry Fund
have completed the filing in Asset Management Association of China. Chongqing Kangxin
Semiconductor Industry Fund has accomplished the signing of the partnership agreement and now
the filing in Asset Management Association of China is underway.
(IV) Disclosure index of significant information
Link on
Announc
http://w
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ww.cninf
No.
o.com.cn
Announcement on Resignation of Vice President of theSecurities Times B29, Shanghai
2020-01 2020-1-14
Company Securities News 40 etc.
http://www
Announcement on the Progress of Offering Guarantees toSecurities Times B24, Shanghai .cninfo.co
2020-02 2020-1-17
the Majority-owned Subsidiary Securities News 68 etc. m.cn/new/i
ndex
Announcement on the Progress of Offering Guarantees toSecurities Times B64, Shanghai
2020-03 2020-1-21
the Majority-owned Subsidiary Securities News 89 etc.
89
Konka Group Co., Ltd. Annual Report 2020
Announcement on Signing Strategic Framework Securities Times B64, Shanghai
2020-04 2020-1-21
Agreement Securities News 89 etc.
Securities Times B33, Shanghai
2020-05 2020-2-5 Announcement on Abnormal Volatility of Stock Trading
Securities News 60 etc.
Securities Times B46, Shanghai
2020-06 2020-2-7 Announcement on Abnormal Volatility of Stock Trading
Securities News 68 etc.
Securities Times B11, Shanghai
2020-07 2020-2-10 Announcement on Abnormal Volatility of Stock Trading
Securities News 44 etc.
Securities Times B31, Shanghai
2020-08 2020-2-13 Announcement on Abnormal Volatility of Stock Trading
Securities News 52 etc.
Securities Times B29, Shanghai
2020-09 2020-2-21 Announcement on Abnormal Volatility of Stock Trading
Securities News 57 etc.
Announcement on Reply for the Concern Letter ofSecurities Times B19, Shanghai
2020-10 2020-2-25
Shenzhen Stock Exchange Securities News 5 etc.
Announcement on Progress of Reply for the Concern Securities Times B79, Shanghai
2020-11 2020-2-27
Letter of Shenzhen Stock Exchange Securities News 76 etc.
Announcement on the Resolution of the 23rd Meeting of Securities Times B44, Shanghai
2020-12 2020-3-3
the 9 Board of Directors
th
Securities News 65 etc.
Announcement on Launch and Establishment of Securities Times B44, Shanghai
2020-13 2020-3-3
Emergying Industry Development Investment Fund Securities News 65 etc.
Announcement on Receiving the Reply on Enquiry of
Securities Times B44, Shanghai
2020-14 2020-3-3 Any Planned Events with Significant Effects on the
Securities News 65 etc.
Company by Controlling Shareholders
Supplementary Announcement on Launch and
Securities Times B6, Shanghai Securities
2020-15 2020-3-4 Establishment of Emergying Industry Development
News 36 etc.
Investment Fund
Announcement on Offering Overseas Loan underSecurities Times B25, Shanghai
2020-16 2020-3-18
Domestic Guarantee to Foreign Wholly-owned Subsidiary Securities News 44 etc.
Announcement on Offering Guarantees by the
Securities Times B24, Shanghai
2020-17 2020-3-24 Majority-owned Subsidiary to its Majority-owned
Securities News 60 etc.
Subsidiary
Announcement on the Resolution of the 24th Meeting of Securities Times B33, Shanghai
2020-18 2020-3-28
the 9 Board of Directors
th
Securities News 28 etc.
Proposal on Initiating the Establishment of Wuzhen Jiayu
Securities Times B33, Shanghai
2020-19 2020-3-28 Digital Economy Industry Fund and Related-party
Securities News 28 etc.
Transaction
Announcement on the Progress of Offering Guarantees toSecurities Times B40, Shanghai
2020-20 2020-4-11
the Wholly-owned Subsidiary Securities News 24 etc.
90
Konka Group Co., Ltd. Annual Report 2020
Announcement on Expiration of Financial Aids of Securities Times B18, Shanghai
2020-21 2020-4-14
RMB8.9 million to Chongqing Qingjia Securities News 81 etc.
Securities Times B214, Shanghai
2020-22 2020-4-15 Announcement on the 2019 Earnings Forecasts
Securities News 249 etc.
Announcement on the 2020 First Quarter Earnings Securities Times B214, Shanghai
2020-23 2020-4-15
Forecasts Securities News 249 etc.
Announcement on the Resolution of the 6th Meeting of the Securities Times B226, Shanghai
2020-24 2020-4-22
9 Supervisory Committee
th
Securities News etc.
Announcement on the Expectation of the 2020 Routine Securities Times B226, Shanghai
2020-25 2020-4-22
Related Transaction Securities News etc.
Announcement on Revising Corporate Systems such as Securities Times B225, Shanghai
2020-26 2020-4-22
Articles of Associations, etc. Securities News etc.
Announcement on Appointment of the Auditor for Securities Times B226, Shanghai
2020-27 2020-4-22
Financial Statements and Internal Control in 2020 Securities News etc.
Announcement on the Changes of Part of Accounting Securities Times B226, Shanghai
2020-28 2020-4-22
Policies Securities News etc.
Securities Times B226, Shanghai
2020-29 2020-4-22 Announcement on Plan of Profit Distribution for 2019
Securities News etc.
2020-30 2020-4-22 2019 Annual Report
Securities Times B225, Shanghai
2020-31 2020-4-22 Abstract of the 2019 Annual Report
Securities News etc.
Securities Times B226, Shanghai
2020-32 2020-4-22 Announcement on Assets Impairment Provision in 2019
Securities News etc.
Announcement on the Resolution of the 25th Meeting of Securities Times B226, Shanghai
2020-33 2020-4-22
the 9 Board of Directors
th
Securities News etc.
Securities Times B226, Shanghai
2020-34 2020-4-22 Notice on Convening the 2019 Annual General Meeting
Securities News etc.
Securities Times, Shanghai Securities
2020-35 2020-4-30 Text of the 2020 First Quarter Report
News 609 etc.
2020-36 2020-4-30 2020 First Quarter Report
Announcement on Offering Guarantees by the
Securities Times B56, Shanghai
2020-37 2020-5-13 Majority-owned Subsidiary to its Majority-owned
Securities News 108 etc.
Subsidiary
Announcement on the Progress of Offering Guarantees toSecurities Times B24, Shanghai
2020-38 2020-5-15
the Majority-owned Subsidiary Securities News 64 etc.
Indicative Announcement on Do’s and Don’ts for Securities Times B24, Shanghai
2020-39 2020-5-15
Participating in the Annual General Meeting of 2019 Securities News 64 etc.
91
Konka Group Co., Ltd. Annual Report 2020
during the Period of the Epidemic Preservation and
Control
Announcement on Resolutions of the 2019 Annual Securities Times B87, Shanghai
2020-40 2020-5-19
General Meeting Securities News 25 etc.
Announcement on the Progress of Offering Guarantees toSecurities Times B58, Shanghai
2020-41 2020-5-23
the Majority-owned Subsidiary Securities News 49 etc.
Announcement on the Resolution of the 27th Meeting of Securities Times B58, Shanghai
2020-42 2020-5-23
the 9 Board of Directors
th
Securities News 49 etc.
Announcement on Terminating Private Placement ofSecurities Times B58, Shanghai
2020-43 2020-5-23
A-Shares Securities News 49 etc.
Announcement on the Company Signing with the
Subscription Object a ‘Termination Contract for the ShareSecurities Times B58, Shanghai
2020-44 2020-5-23
Subscription Agreement with Conditional Entry into Securities News 49 etc.
Force’ and Related-party Transaction
Announcement on the Resolution of the 8th Meeting of the Securities Times B58, Shanghai
2020-45 2020-5-23
9 Supervisory Committee
th
Securities News 49 etc.
Announcement on Signing Project Cooperative Securities Times B45, Shanghai
2020-46 2020-6-5
Agreement with Municipal Government of Xinxiang Securities News 100 etc.
Announcement on Plan of Private Placement of CorporateSecurities Times B74, Shanghai
2020-47 2020-6-6
Bonds Securities News 65 etc.
Announcement on Providing Advertising Services to OCT Securities Times B74, Shanghai
2020-48 2020-6-6
Group and Related-party Transaction Securities News 65 etc.
Announcement on the Transfer of 34% Equity of Nanjing
Securities Times B75, Shanghai
2020-49 2020-6-6 K-Star Science and Technology Industry Park Operation
Securities News 65 etc.
and Management Co., Ltd. and Related-party Transaction
Notice on Convening the 1st Extraordinary General Securities Times B74, Shanghai
2020-50 2020-6-6
Meeting of 2020 Securities News 65 etc.
Announcement on Constructing the Manufacturing Base Securities Times B74, Shanghai
2020-51 2020-6-6
of Konka Smart Terminal for Export by Investments Securities News 65 etc.
Announcement on Offering Guarantee Limit to the JointSecurities Times B74, Shanghai
2020-52 2020-6-6
Stock Companies and Related-party Transactions Securities News 65 etc.
Securities Times B74, Shanghai
2020-53 2020-6-6 Announcement on External Guarantees
Securities News 65 etc.
Announcement on the Resolution of the 28th Meeting of Securities Times B74, Shanghai
2020-54 2020-6-6
the 9 Board of Directors
th
Securities News 65 etc.
Announcement on the Progress of Offering Guarantees toSecurities Times A41, Shanghai
2020-55 2020-6-12
the Majority-owned Subsidiary Securities News 60 etc.
2020-56 2020-6-16 Announcement on Receiving the Notice on TerminatingSecurities Times B84, Shanghai
92
Konka Group Co., Ltd. Annual Report 2020
the Review of the Application for Administration Securities News 108 etc.
Permission of China Securities Regulatory Commission
Announcement on the Progress of Offering Guarantees toSecurities Times B28, Shanghai
2020-57 2020-6-17
the Majority-owned Subsidiary Securities News 89 etc.
Announcement on Resolutions of the 1st Extraordinary Securities Times B2, Shanghai Securities
2020-58 2020-6-23
General Meeting of 2020 News 100 etc.
Announcement on the Resolution of the 29th Meeting of Securities Times B106, Shanghai
2020-59 2020-6-24
the 9 Board of Directors
th
Securities News 124 etc.
Announcement on Extending the Investment Term ofSecurities Times B106, Shanghai
2020-60 2020-6-24
Orient Konka Industrial M&A Fund Securities News 124 etc.
Announcement on the Transfer of Some Patents in Securities Times B106, Shanghai
2020-61 2020-6-24
Relation to Cloud Big Data and Related-party Transaction Securities News 124 etc.
Announcement on Completing Changes of Registration
for the Transfer of 34% Equity of Nanjing K-Star ScienceSecurities Times B11, Shanghai
2020-62 2020-6-30
and Technology Industry Park Operation and Securities News 224 etc.
Management Co., Ltd.
Securities Times B112, Shanghai Securities
2020-63 2020-7-1 Announcement of Equity Allocation 2019
News 108 etc.
Announcement on the progress of transferring some Securities Times B124, Shanghai Securities
2020-64 2020-7-1
patents related to cloud big data News 108 etc.
Announcement on Receiving Government Subsidy to the Securities Times B124, Shanghai Securities
2020-65 2020-7-1
Majority-owned Subsidiary News 108 etc.
Announcement on the Progress of Offering Guarantees to Securities Times B34, Shanghai Securities
2020-66 2020-7-3
the Majority-owned Subsidiary News 108 etc.
Announcement on the Completion of Registration of
Securities Times B34, Shanghai Securities
2020-67 2020-7-10 Private Fund of Emerging Industrial Development
News 140etc.
Investment Fund initiated by the Company
Announcement on the Progress of Offering Guarantees to Securities Times B86, Shanghai Securities
2020-68 2020-7-14
the Majority-owned Subsidiary News 64etc.
Announcement on the 2020 Semi-Annual Earnings Securities Times B26, Shanghai Securities
2020-69 2020-7-15
Forecasts News 108etc.
Announcement on Resolutions of the 30th Meeting of the Securities Times B11, Shanghai Securities
2020-70 2020-7-21
9th Board of Directors News 121etc.
Announcement on Transfer of Partial Equity in Dongguan Securities Times B11, Shanghai Securities
2020-71 2020-7-21
Konka Investment by Listing News 121etc.
Notice on Convening the 2nd Extraordinary General Securities Times B11, Shanghai Securities
2020-72 2020-7-21
Meeting of 2020 News 121etc.
2020-73 2020-7-21 Announcement on Offering Financial Aid for Dongguan Securities Times B11, Shanghai Securities
93
Konka Group Co., Ltd. Annual Report 2020
Konka Investment Based on the Shareholding Ratio News 121etc.
Announcement on Participating in the Establishment of Securities Times B11, Shanghai Securities
2020-74 2020-7-21
Yibin Kanghui Emerging Industry Fund News 121etc.
Announcement on Investment and Construction of Frestec Securities Times B11, Shanghai Securities
2020-75 2020-7-21
Refrigeration Industrial Park News 121etc.
Announcement on the Transferring Some Patents in
Securities Times B11, Shanghai Securities
2020-76 2020-7-21 Relation to IOT, Smart Health and UHD Display
News 121etc.
Terminals and Related-party Transactions
Announcement on the Progress of Offering Guarantees to Securities Times B48, Shanghai Securities
2020-77 2020-7-30
the Majority-owned Sub-subsidiary News 49etc.
Announcement on Capital Increase of Shenzhen Konka Securities Times B28, Shanghai Securities
2020-78 2020-7-31
Circuit Co., Ltd. of the Wholly-owned Subsidiary News 105etc.
Announcement on Resolutions of the 31st Meeting of the Securities Times B28, Shanghai Securities
2020-79 2020-7-31
9th Board of Directors News 105etc.
Announcement on the Progress of Offering Guarantees to Securities Times B26, Shanghai Securities
2020-80 2020-8-7
the Wholly-owned Subsidiary News 119etc.
Announcement on Resignation of Directors of the Securities Times B68, Shanghai Securities
2020-81 2020-8-11
Company News 124etc.
Announcement on Resolutions of the 2nd Extraordinary Securities Times B68, Shanghai Securities
2020-82 2020-8-11
General Meeting of 2020 News 124etc.
Announcement on Cooperation Framework Agreement Securities Times B106, Shanghai Securities
2020-83 2020-8-18
Signed with Yancheng Government News 140etc.
Announcement on the Progress of Offering Guarantees to Securities Times B106, Shanghai Securities
2020-84 2020-8-18
the Majority-owned Subsidiary News 140etc.
Announcement on Investment Agreement Signed with
Securities Times B36, Shanghai Securities
2020-85 2020-8-20 Management Committee of Yancheng High-tech
News 132etc.
Industrial Development Zone
Announcement on the Progress of Offering Guarantees to Securities Times B11, Shanghai Securities
2020-86 2020-8-22
the Majority-owned Subsidiary News 28etc.
Announcement on Resolutions of the 32nd Meeting of the Securities Times B315, Shanghai Securities
2020-87 2020-8-28
9th Board of Directors News 305etc.
Notice on Convening the 3rd Extraordinary General Securities Times B315, Shanghai Securities
2020-88 2020-8-28
Meeting of 2020 News 305etc.
Announcement on the Acquisition and Storage of Some Securities Times B315, Shanghai Securities
2020-89 2020-8-28
Land of Frestec Household Appliances News 305etc.
2020-90 2020-8-28 Semi-Annual Report 2020
2020-91 2020-8-28 Summary of Semi-Annual Report 2020 Securities Times B315, Shanghai Securities
94
Konka Group Co., Ltd. Annual Report 2020
News 305etc.
Announcement on the Progress of Offering Guarantees to Securities Times B70, Shanghai Securities
2020-92 2020-8-29
the Majority-owned Subsidiary News 140etc.
Announcement on the Progress of Offering Guarantees to Securities Times B45, Shanghai Securities
2020-93 2020-9-2
the wholly-owned subsidiary News 105etc.
Announcement on the Progress of Offering Guarantees to Securities Times B15, Shanghai Securities
2020-94 2020-9-10
the Majority-owned Subsidiary News 105etc.
Announcement on Resolutions of the 3rd Extraordinary Securities Times B45, Shanghai Securities
2020-95 2020-9-15
General Meeting of 2020 News 148etc.
Announcement on Transfer of Partial Equity in Securities Times A32, Shanghai Securities
2020-96 2020-9-16
Chongqing Konka Real Estate Development by Listing News 92etc.
Announcement on Pending Lawsuits and Arbitrations Securities Times B59, Shanghai Securities
2020-97 2020-9-19
with large amount News 44etc.
Announcement on the Progress of Transfer of Partial Securities Times B59, Shanghai Securities
2020-98 2020-9-19
Equity in Dongguan Konka Investment by Listing News 44etc.
Announcement on Resolutions of the 33th Meeting of the Securities Times B25, Shanghai Securities
2020-99 2020-9-23
9th Board of Directors News 128etc.
Announcement on Participating in the Establishment of Securities Times B11, Shanghai Securities
2020-100 2020-9-23
Konka Yancheng Electronic Information Industry Fund News 125etc.
Announcement on Offering Financial Aid for Chongqing Securities Times B25, Shanghai Securities
2020-101 2020-9-23
Konka Fuze Based on the Shareholding Ratio News 128etc.
Announcement on Participating in the Bidding for
Securities Times B25, Shanghai Securities
2020-102 2020-9-23 Supporting Land of Konka (Chongqing) Semiconductor
News 128etc.
Optoelectronic Industrial Park
Announcement on the Progress of Offering Guarantees to Securities Times B15, Shanghai Securities
2020-103 2020-9-26
the Majority-owned Subsidiary News 28etc.
Announcement on the Completion of Registration of
Securities Times B49, Shanghai Securities
2020-104 2020-9-26 Private Fund of Konka Yancheng Electronic Information
News 28etc.
Industry Fund established by the Company
Announcement on Receiving Government Subsidy to the Securities Times B61, Shanghai Securities
2020-105 2020-10-9
Majority-owned Subsidiary News 52etc.
Announcement on the Progress of Offering Guarantees to Securities Times B38, Shanghai Securities
2020-106 2020-10-14
the Majority-owned Subsidiary News 76etc.
Reminder Announcement on Planning to Transfer 51% Securities Times B23, Shanghai Securities
2020-107 2020-10-16
Equity Interests of Chuzhou Kangxin News 52etc.
Announcement on Strategic Cooperation Agreement Securities Times B20, Shanghai Securities
2020-108 2020-10-17
Signed with Cinda Investment News 20etc.
95
Konka Group Co., Ltd. Annual Report 2020
Announcement on the Completion of Registration of
Securities Times B18, Shanghai Securities
2020-109 2020-10-22 Private Fund of Yibin Kanghui Emerging Industry Fund
News 100etc.
established by the Company
Announcement on the Receipt of A No-Action Letter that
Meets the Transfer Conditions of Shenzhen Stock Securities Times B69, Shanghai Securities
2020-110 2020-10-22
Exchange for Non-Public Issuance of Corporate Bonds In News 100etc.
2020
Securities Times B42, Shanghai Securities
2020-111 2020-10-24 Announcement on External Guarantees
News 28etc.
Notice on Convening the 4th Extraordinary General Securities Times B42, Shanghai Securities
2020-112 2020-10-24
Meeting of 2020 News 28etc.
Announcement on Resolutions of the 34th Meeting of the Securities Times B42, Shanghai Securities
2020-113 2020-10-24
9th Board of Directors News 28etc.
Announcement on Transfer 51% Equity Interests of Securities Times B42, Shanghai Securities
2020-114 2020-10-24
Chuzhou Kangxin by Listing News 28etc.
Announcement on Offering Financial Aid for Chuzhou Securities Times B42, Shanghai Securities
2020-115 2020-10-24
Kangxin Based on the Shareholding Ratio News 28etc.
Securities Times B40, Shanghai Securities
2020-116 2020-10-31 Announcement on Provision for Impairment of Assets
News 31etc.
Securities Times B40, Shanghai Securities
2020-117 2020-10-31 Text of the Third Quarter Report 2020
News 31etc.
2020-118 2020-10-31 Third Quarter Report 2020
Announcement on the Progress of Offering Guarantees to Securities Times B31, Shanghai Securities
2020-119 2020-11-5
the Wholly-owned Subsidiary News 68etc.
Announcement on Resolutions of the 4th Extraordinary Securities Times B40, Shanghai Securities
2020-120 2020-11-10
General Meeting of 2020 News 32etc.
Announcement on Cooperation Framework Agreement
Signed with Management Committee of Nanchang Securities Times A6, Shanghai Securities
2020-121 2020-11-12
Economic and Technological Development Zone News 36etc.
Management Committee
Announcement on the Progress of Offering Guarantees to Securities Times B30, Shanghai Securities
2020-122 2020-11-20
the Majority-owned Sub-subsidiary News 89etc.
Announcement on the Progress of Offering Guarantees to Securities Times B15, Shanghai Securities
2020-123 2020-11-26
the Majority-owned Subsidiary News 76etc.
Announcement on the Progress of Transfer of Partial
Securities Times B30, Shanghai Securities
2020-124 2020-11-26 Equity in Chongqing Konka Property Development Co.,
News 76etc.
Ltd. by Listing
2020-125 2020-12-1 Announcement on the Progress of Offering Guarantees to Securities Times B22, Shanghai Securities
96
Konka Group Co., Ltd. Annual Report 2020
the Majority-owned Subsidiary News 105etc.
Announcement on Participating in the Online Collective
Reception Day for Investors of Listed Companies in the Securities Times B22, Shanghai Securities
2020-126 2020-12-1
"Honesty and Trustworthy, Respectful Listed Company" News 105etc.
in Shenzhen Area in 2020
Announcement on Completing the Industrial and
Commercial Registration of Changes for Transfer of Securities Times B35, Shanghai Securities
2020-127 2020-12-1
Partial Equity in Chongqing Konka Real Estate News 105etc.
Development by Listing
Announcement on the Progress of Investment and
Securities Times B17, Shanghai Securities
2020-128 2020-12-1 Construction of An Environmental Protection Technology
News 105etc.
Town Project in Yantai
Announcement on Resolutions of the 36th Meeting of the Securities Times B77, Shanghai Securities
2020-129 2020-12-16
9th Board of Directors News 89etc.
Announcement on Participating in the Establishment of Securities Times B77, Shanghai Securities
2020-130 2020-12-16
Chongqing Kangxin Semiconductor Industry Fund News 89etc.
Announcement on the Progress of Offering Guarantees to Securities Times B64, Shanghai Securities
2020-131 2020-12-17
the Majority-owned Sub-subsidiary News 52etc.
Announcement on the Progress of Transfer 51% Equity Securities Times B39, Shanghai Securities
2020-132 2020-12-22
Interests of Chuzhou Kangxin by Listing News 105etc.
Announcement on Majority-owned Subsidiary's Loan to Securities Times B65, Shanghai Securities
2020-133 2020-12-23
Shareholders Based on the Shareholding Ratio News 81etc.
Announcement on Resolutions of the 37th Meeting of the Securities Times B65, Shanghai Securities
2020-134 2020-12-23
9th Board of Directors News 81etc.
Announcement on the Progress of Offering Guarantees to Securities Times B18, Shanghai Securities
2020-135 2020-12-25
the Majority-owned Subsidiary News 76etc.
Announcement on Receiving Government Subsidy to the Securities Times B77, Shanghai Securities
2020-136 2020-12-26
Majority-owned Subsidiary News 97etc.
Announcement on Receiving Government Subsidy to the Securities Times B68, Shanghai Securities
2020-137 2020-12-30
Wholly-owned Subsidiary News 124etc.
Announcement on Application for Initial Public Offering
Securities Times B34, Shanghai Securities
2020-138 2021-1-4 of Shares of Joint Stock Companies approved by CSRC
News 49etc.
Issuance Examination Committee
Announcement on the Completion of Registration of
Securities Times B35, Shanghai Securities
2020-139 2021-1-4 Private Fund of Konka Yancheng Electronic Information
News 49etc.
Industry Fund established by the Company
XX Significant Events of Subsidiaries
□ Applicable √ Not applicable
97
Konka Group Co., Ltd. Annual Report 2020
Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the Reporting Period (+/-) After
Shar
es
as
divi
Shares as
den
dividend
Percen d
New converted Subt Percent
Shares tage con Other Shares
issues from otal age (%)
(%) vert
capital
ed
reserves
fro
m
prof
it
1. Restricted shares 19,500 0.00% 19,500 0.00%
1.3 Shares held by
other domestic 19,500 0.00% 19,500 0.00%
investors
Shares held by
domestic natural 19,500 0.00% 19,500 0.00%
persons
2. Unrestricted 2,407,925,90 100.00 100.00
2,407,925,908
shares 8 % %
2.1
1,596,574,30 66.31
RMB-denominated 1,596,574,300 66.31%
0 %
ordinary shares
2.2 Domestically 33.69
811,351,608 811,351,608 33.69%
listed foreign shares %
2,407,945,40 100.00 100.00
3. Total shares 2,407,945,408
8 % %
Reasons for share changes:
□ Applicable √ Not applicable
Approval of share changes:
98
Konka Group Co., Ltd. Annual Report 2020
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Progress on any share repurchases:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Effects of share changes on the basic and diluted earnings per share, equity per share attributable to
the Company’s ordinary shareholders and other financial indicators of the prior year and the prior
accounting period, respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to
be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
□ Applicable √ Not applicable
II. Issuance and Listing of Securities
1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period
□ Applicable √ Not applicable
2. Changes to Total Shares, Shareholder Structure and Asset and Liability Structures
□ Applicable √ Not applicable
3. Existing Staff-Held Shares
□ Applicable √ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
Unit: share
Number of ordinary Number of preferred
Number of preferred
Number of shareholders at the shareholders with resumed
shareholders with
ordinary 129,637 month-end prior to 122,570 0 voting rights at the month-end 0
resumed voting
shareholders the disclosure of this prior to the disclosure of this
rights (if any)
Report Report (if any)
5% or greater shareholders or top 10 shareholders
Increase/de Shares in
Sharehol
Nature of Total shares crease in Restricte Unrestricte pledge or
ding
Name of shareholder shareholde held at the the d shares d shares frozen
percenta
r period-end Reporting held held Sha
ge Status
Period res
99
Konka Group Co., Ltd. Annual Report 2020
OVERSEAS CHINESE State-own
523,746,93 523,746,93
TOWN ENTERPRISES ed legal 21.75% 0 0
2 2
CO., LTD person
CITIC SECURITIES Foreign
182,100,20 182,100,20
BROKERAGE (HONG legal 7.56% 0 0
2 2
KONG) CO., LTD. person
Domestic
WANG JINGFENG natural 2.42% 58,327,758 50,627,758 0 58,327,758
person
Foreign
GUOYUAN SECURITIES
legal 2.41% 58,100,325 3,896,546 0 58,100,325
BROKER (HK) CO., LTD.
person
Foreign
HOLY TIME GROUP
legal 2.38% 57,289,100 1,150,000 0 57,289,100
LIMITED
person
Foreign
GAOLING FUND,L.P. legal 2.19% 52,801,250 0 0 52,801,250
person
Foreign
NAM NGAI natural 0.94% 22,567,540 1,360,200 0 22,567,540
person
CHINA MERCHANTS State-own
SECURITIES (HK) ed legal 0.81% 19,490,320 -3,503,704 0 19,490,320
LIMITED person
Haitong International Sec Foreign
urities Company Limited- legal 0.50% 12,146,654 -1,675,500 0 12,146,654
Account Client person
Foreign
Hong Kong Securities -10,027,60
legal 0.47% 11,329,823 0 11,329,823
Clearing Company Ltd. 2
person
Strategic investor or general legal
person becoming a top-10 ordinary
N/A
shareholder due to rights issue (if
any) (see note 3)
Happy Bloom Investment Limited, a wholly-owned subsidiary of the Company’s first
majority shareholder Overseas Chinese Town Enterprises Co. (“OCT Group” for short),
holds 180,001,110 and 18,360,000 ordinary shares in the Company respectively through
Related or acting-in-concert parties
CITIC Securities Brokerage (Hong Kong) Co., Ltd. and China Merchants Securities
among the shareholders above
(HK) Limited. Happy Bloom Investment Limited and Overseas Chinese Town
Enterprises Co. are parties acting in concert. Other than that, it is unknown whether the
other shareholders are related parties or acting-in-concert parties or not.
100
Konka Group Co., Ltd. Annual Report 2020
Above shareholders involved in
entrusting/being entrusted with voting N/A
rights and giving up voting rights
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held at the period-end
Type Shares
OVERSEAS CHINESE TOWN RMB-denominate
523,746,932 523,746,932
ENTERPRISES CO., LTD d ordinary stock
Domestically
CITIC SECURITIES BROKERAGE
182,100,202 listed foreign 182,100,202
(HONG KONG) CO., LTD.
stock
RMB-denominate
WANG JINGFENG 58,327,758 58,327,758
d ordinary stock
Domestically
GUOYUAN SECURITIES BROKER
58,100,325 listed foreign 58,100,325
(HK) CO., LTD.
stock
Domestically
HOLY TIME GROUP LIMITED 57,289,100 listed foreign 57,289,100
stock
Domestically
GAOLING FUND,L.P. 52,801,250 listed foreign 52,801,250
stock
Domestically
NAM NGAI 22,567,540 listed foreign 22,567,540
stock
Domestically
CHINA MERCHANTS SECURITIES
19,490,320 listed foreign 19,490,320
(HK) LIMITED
stock
Domestically
Haitong International Securities Compa
12,146,654 listed foreign 12,146,654
ny Limited-Account Client
stock
Hong Kong Securities Clearing Company RMB-denominate
11,329,823 11,329,823
Ltd. d ordinary stock
Happy Bloom Investment Limited, a wholly-owned subsidiary of the Company’s first
Related or acting-in-concert parties majority shareholder Overseas Chinese Town Enterprises Co. (“OCT Group” for short),
among top 10 unrestricted public holds 180,001,110 and 18,360,000 common shares in the Company respectively through
shareholders, as well as between top CITIC Securities Brokerage (Hong Kong) Co., Ltd. and China Merchants Securities (HK)
10 unrestricted public shareholders Limited. Happy Bloom Investment Limited and Overseas Chinese Town Enterprises Co.
and top 10 shareholders are parties acting in concert. Other than that, it is unknown whether the other shareholders
are related parties or acting-in-concert parties or not.
101
Konka Group Co., Ltd. Annual Report 2020
Top 10 ordinary shareholders
Wang Jingfeng holds 58,327,758 A-shares in the Company through his securities account
involved in securities margin trading
for customer credit trading guarantee in Guotai Junan Securities Co., Ltd.
(if any) (see note 4)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted
ordinary shareholders of the Company conducted any promissory repo during the Reporting Period.
□ Yes √ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a central state-owned legal person
Type of the controlling shareholder: legal person
Legal Unified
Name of Date of
representati social
actual establishm Principal activity
ve/person credit
controller ent
in charge code
Export of textile, light industrial products, etc; import of self-used goods
in Shenzhen, mechanical equipment, light industrial products, etc. as
approved by the relevant authorities of Shenzhen (under Government
Document JMB [92] WJMGTSZZ No. A19024); compensation trade;
Overseas investment in tourism and relevant cultural industry (including art
Chinese 11 9144030 performance, entertainment and their services, etc), industry, real estate,
Duan
Town November 0190346 commerce & trade, packaging, decoration and investment in printing
Xiannian
Enterprises 1985 175T industry. The convert of export commodities into domestic sale and the
Co. domestic sales of import commodities. Travelling, rental of warehouses,
culture and art, bonded warehouse of car donation, convention and
exhibition services (the projects involved in license management can be
operated after getting the relevant license first ); sales of automobile
(sedan car included)
As of 31 December 2020, Overseas Chinese Town Enterprises Co. directly held 47.01% equity of Shenzhen
Overseas Chinese Town Co., Ltd. (a company listed in Shenzhen Stock Exchange, SZ. 000069) and
indirectly held 0.39% equity of Shenzhen Overseas Chinese Town Co., Ltd. through OCT Capital
Investment Management Co., Ltd. Meanwhile, Shenzhen Overseas Chinese Town Co., Ltd. indirectly held
Controlling 70.94% equity of OCT (Asia) Holdings Ltd. (a company listed on the main Board of Hong Kong Stock
shareholder’s Exchange, 3366.HK). Overseas Chinese Town Enterprises Co. indirectly held 53.88% equity of Yunnan
holdings in other Tourism Co., Ltd. (a company listed in Shenzhen Stock Exchange, SZ.002059).Overseas Chinese Town
listed companies Enterprises Co. held 8% equity of China Everbright Bank Company Limited (a company listed on the main
at home or abroad Board of Shanghai Stock Exchange (SH.601818) and the main Board of Hong Kong Stock Exchange
in the Reporting (6818.HK). Overseas Chinese Town Enterprises Co. indirectly held 2.74% equity of Zhejiang Century
Period Huatong Group Co., Ltd. (a company listed in Shenzhen Stock Exchange, SZ.002602) through its
subsidiary Shenzhen OCT Capital Investment Management Co., Ltd. Overseas Chinese Town Enterprises
Co. indirectly held 11.12% of equity of Jiangsu Guoxin Corporation Limited (a company listed in Shenzhen
Stock Exchange, SZ. 002608) through its subsidiary Shenzhen OCT Cultural Group Co., Ltd.. Overseas
Chinese Town Enterprises Co. indirectly held 0.14% of equity of Yihai Kerry Arawana Holdings Co., Ltd (a
102
Konka Group Co., Ltd. Annual Report 2020
company listed on GEM of Shenzhen Stock Exchange, SZ. 300999) through its subordinate enterprise
Shenzhen OCT Cultural Industry Equity Investment Parent Fund Partnership (Limited Partnership).
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: Central institution for state-owned assets management
Type of the actual controller: legal person
Legal
Date of Unified social
Name of actual controller representative/person in Principal activity
establishment credit code
charge
State-owned Assets Supervision and
Administration Commission of the Hao Peng Not applicable Not applicable
State Council
Actual controller’s holdings in other listed companies at home or
Not applicable
abroad in the Reporting Period
Change of the actual controller during the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of
asset management.
□ Applicable √ Not applicable
4. Other 10% or Greater Corporate Shareholders
□ Applicable √ Not applicable
103
Konka Group Co., Ltd. Annual Report 2020
5. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder, Actual
Controller, Reorganizer and Other Commitment Makers
□ Applicable √ Not applicable
104
Konka Group Co., Ltd. Annual Report 2020
Part VII Preferred Shares
□ Applicable √ Not applicable
No preferred shares in the Reporting Period.
105
Konka Group Co., Ltd. Annual Report 2020
Part VIII Convertible Corporate Bonds
□ Applicable √ Not applicable
No convertible corporate bonds in the Reporting Period.
106
Konka Group Co., Ltd. Annual Report 2020
Part IX Directors, Supervisors, Senior Management and Staff
I Change in Shareholdings of Directors, Supervisors and Senior Management
Incr Decr
ease ease
Beg Othe
G in in Endi
Incu inni r
e the the ng
mbe A ng incre
Name Office title n Start of tenure End of tenure Rep Rep share
nt/Fo ge shar ase/d
d ortin ortin holdi
rmer ehol ecrea
er g g ng
ding se
Peri Peri
od od
Director, Incu M
Liu
Chairman of the mbe al 49 3 December 2018 3 December 2021 0 0 0 0 0
Fengxi
Board nt e
Incu M
Yao 14 September
Director mbe al 46 3 December 2021 0 0 0 0 0
Wei 2020
nt e
Incu M
Zhang
Director mbe al 39 3 December 2018 3 December 2021 0 0 0 0 0
Jing
nt e
Incu M
Zhou
Director mbe al 42 3 December 2018 3 December 2021 0 0 0 0 0
Bin
nt e
Sun Incu M
Independent
Shengd mbe al 66 3 December 2018 3 December 2021 0 0 0 0 0
director
ian nt e
Wang Incu M
Independent
Shugua mbe al 50 3 December 2018 3 December 2021 0 0 0 0 0
director
ng nt e
F
Deng Incu e
Independent
Chunhu mbe m 58 3 December 2018 3 December 2021 0 0 0 0 0
director
a nt al
e
Supervisor,
Incu M
Cai chairman of the
mbe al 48 15 March 2021 3 December 2021 0 0 0 0 0
Weibin Supervisory
nt e
Committee
107
Konka Group Co., Ltd. Annual Report 2020
Incu M
Yang
Supervisor mbe al 52 3 December 2018 3 December 2021 0 0 0 0 0
Guobin
nt e
Incu M
29 November
Li Jun Supervisor mbe al 50 3 December 2021 0 0 0 0 0
2018
nt e
Incu M
Zhou
President mbe al 42 27 March 2020 27 March 2023 0 0 0 0 0
Bin
nt e
Li Incu M
Hongta Vice president mbe al 53 27 March 2020 27 March 2023 0 0 0 0 0
o nt e
Wu Incu M
Yongju Board Secretary mbe al 46 27 March 2020 27 March 2023 0 0 0 0 0
n nt e
Incu M
Li
CFO mbe al 48 27 March 2020 27 March 2023 0 0 0 0 0
Chunlei
nt e
Incu M
Yang
Vice president mbe al 51 27 March 2020 27 March 2023 0 0 0 0 0
Bo
nt e
Incu M
Cao
Vice president mbe al 43 27 March 2020 27 March 2023 0 0 0 0 0
Shiping
nt e
Sun Incu M
26,0 26,0
Qingya Vice president mbe al 49 27 March 2020 27 March 2023 0 0 0
00 00
n nt e
M
He For
Director al 47 3 December 2018 10 August 2020 0 0 0 0 0
Haibin mer
e
Supervisor,
M
Wang chairman of the For
al 60 3 December 2018 15 March 2021 0 0 0 0 0
Youlai Supervisory mer
e
Committee
M
He For
Vice president al 51 10 March 2017 13 January 2020 0 0 0 0 0
Jianjun mer
e
26,0 26,0
Total - - - - - - 0 0 0
00 00
108
Konka Group Co., Ltd. Annual Report 2020
II Change of Directors, Supervisors and Senior Management
√Applicable □ Not applicable
Name Office title Type of change Date of change Reason for change
He Jianjun Vice president Expired 13 January 2020 Resign for job change
He Haibin Director Expired 10 August 2020 Resign for job change
Supervisor,
chairman of
Wang Youlai the Expired 15 March 2021 Resign for job change (retirement)
Supervisory
Committee
Elected as a director by the general meeting of
Yao Wei Director Appoint 14 September 2020
shareholders
Elected as a supervisor by the general meeting of
Cai Weibin Supervisor Appoint 15 March 2021
shareholders
chairman of
the The chairman of the board of supervisors is
Cai Weibin Appoint 15 March 2021
Supervisory elected by the board of supervisors
Committee
III Biographical Information
Professional backgrounds, major work experience and current duties in the Company of the
incumbent directors, supervisors and senior management:
1. Director
Liu Fengxi, male, ethnic group of Han, born in 1972, was the Chairman of the Board with a master
degree. He once worked as the marketing GM for the multi-media division of Konka Group,
Assistant GM and then Vice GM of Shenzhen Konka Telecommunications Technology Co., Ltd.,
Chief of the Operation Management Center of Konka Group, Assistant to President and Vice
President of Konka Group, etc. And now he is acting as the member of the Standing Committee and
Deputy GM of OCT Group, Director and GM of Shenzhen Konka Holding Group Co., Ltd. as well
as the Board Chairman and CEO of Konka Group.
Yao Wei, Director, male, ethnic group of Han, bachelor degree, was born in 1975. He once served
as Chief Accountant in CGN Wind Power Co., Ltd., Chief Accountant in CGN New Energy
Holdings Co., Ltd., Vice GM (in charge) of Financial Department, GM of Financial Department,
GM of Finance and Asset Management Department in China General Nuclear Power Corporation.
Currently, he acts as the member of the Standing Committee and Chief Accountant in Overseas
Chinese Town Enterprises Co. and Director of Konka Group.
Zhang Jing, Director, male, ethnic group of Han, was born in 1982, MBA. He served as Manager of
109
Konka Group Co., Ltd. Annual Report 2020
the CEO’s Office in OCT Group, Senior Manager of the Strategic Development Department in
Shenzhen OCT Co., Ltd., a member of the Preparatory Work Group of Qingdao OCT, Director of
the Administration Department (Deputy Director of the Party Committee Office) in Shenzhen OCT
Properties Co., Ltd., Deputy Director and Director of the Strategic Development Department in
Shenzhen OCT Co., Ltd., General Manager of the Strategic Planning Department in OCT Group,
General Manager of the Corporate Management Department in OCT Group, and Director of the
Corporate Management Department in Shenzhen OCT Co., Ltd.. Currently, he serves as Executive
Deputy General Manager of OCT West Investment Co., Ltd., Executive Director&GM of OCT
(Xi'an) Development Co., Ltd., Director & General Manager of Xi’an Fengdong OCT Development
Co., Ltd., Director of OCT (Yunnan) Investment Co., Ltd., and Director of Konka Group.
Zhou Bin, male, ethnic group of Han, born in 1979, was the director and president of the Company
with a bachelor degree. He once served as the director assistant, deputy director and director in
Operating Management Center in Konka Group, assistant of the president in the Board of Directors
& Director in Operating Management Center in Konka Group and President of Konka Group. Now,
he acts as the director and president in Konka Group, director in Shenzhen Konka Holding Group
Co., Ltd.
2. Independent Director
Sun Shengdian, a male senior economist, ethnic group of Han, born in 1955, was the independent
director of the Company with a doctor degree in engineering. Formerly vice GM, deputy secretary
of the Party committee, GM and president of Shenzhen SEG, Hitachi Color Display Devices Co.,
Ltd., president, secretary of Party Committee of Shenzhen SEG Group Co., Ltd. director of
Shenzhen China Star Optoelectronics Technology Co., Ltd., independent director of Skyworth
Holding Ltd., the vice president of Shenzhen Huakong SEG Co., Ltd., and the head of Shenzhen
Electronics Industries Association. Now, he serves as the independent director of Konka Group.
Wang Shuguang, Independent Director, male, ethnic group of Han, was born in 1971, PhD in
economics, professor and doctoral supervisor. He served as Independent Director of Yantai Rural
Commercial Bank, Jinan Rural Commercial Bank, Ningbo Yuyao Rural Commercial Bank and
SDIC Zhonglu, and External Supervisor and Convener of the Board of Supervisors of Industrial
Bank Co., Ltd. Currently, he serves as Professor and Doctoral Supervisor in the School of
Economics of Peking University, Executive Deputy Director of the Institute for Cultural Industries,
Peking University and Independent Director of Konka Group.
Deng Chunhua, Independent Director, female, ethnic group of Han, born in 1963, MBA, professor
110
Konka Group Co., Ltd. Annual Report 2020
and master’s supervisor of accounting, Certified Public Accountant in China (non-practicing
member). She served as Chief Accountant and Project Manager of WUYIGE Certified Public
Accounts LLP, Zhongnan University of Economics and Law, Member of the Fifth Session of the
Corporate Special Committee of the Chinese Association of Quantitative Economics and Member
of the Professional Jury Committee of Hubei Administration of Sport. From July 1984 till now, she
has been teaching in the School of Accounting of Zhongnan University of Economics and Law as
Assistant Lecturer, Lecturer, Associate Professor and Professor. Currently, she serves as
Independent Director of Zhejiang Goldensea Hi Tech Co.,Ltd, Independent Director of Zhejiang
Jinke Culture Industry Co., Ltd., Independent Director of Wolong Electric Group Co., Ltd. and
Independent Director of Konka Group.
3. Supervisor
Cai Weibin, Chairman of the Supervisory Committee, male, ethnic group of Han, Master’s Degree,
was born in 1973. He once served as vice GM, deputy secretary of the Party Committee and
Secretary of Committee for Discipline Inspection in Chongqing OCT Industry Development Co.,
Ltd. Vice Minister of Discipline Inspection and Supervision and Director of the Discipline
Inspection Office in Overseas Chinese Town Enterprises Co. Currently, he acts as GM of Legal
Compliance Department in Overseas Chinese Town Enterprises Co. and Chairman of the
Supervisory Committee of Konka Group.
Yang Guobin, Supervisor, male, was born in 1969, Bachelor’s Degree, Certified Public Accountant.
He served as Deputy Director of the Finance Department of OCT Group, CFO of Konka Group and
Deputy Director of the Corporate Management Department of OCT Group. Currently, he serves as a
full-time Director in OCT Group, Director of Shenzhen Guangming Group and Supervisor of
Konka Group.
Li Jun, male, ethnic group of Han, born in 1971, member of Communist Party, was an employee
supervisor of the Company with a bachelor degree. Formerly worked as the financial manager of
Nanchang Branch of Telecommunications Technology Co., Ltd., Senior Manager of the Financial
Department in Telecommunications Technology Co., Ltd., the Senior Manager and assistant to the
chief and deputy director of Auditing and Legal Affairs Department in Konka Group, leader of
discipline inspection commission of Konka Group, and employee supervisor of the 8th Supervisory
Committee of Konka Group. Presently working as the deputy secretary of discipline inspection
commission of Konka Group, General counsel, the director of Discipline inspection and
Supervision Center, Chief of the Auditing and Legal Affairs Department.
4. Senior Executive
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Konka Group Co., Ltd. Annual Report 2020
Zhou Bin, male, ethnic group of Han, born in 1979, was the director and president of the Company
with a bachelor degree. He once served as the director assistant, deputy director and director in
Operating Management Center in Konka Group, assistant of the president in the Board of Directors
& Director in Operating Management Center in Konka Group and president of Konka Group. He is
currently a director of Shenzhen Konka Holdings Group Co., Ltd., a director and president of
Konka Group.
Li Hongtao, male, Han nationality, born in 1968, was the vice president of the Company with a
bachelor degree. He successively took the post such as Assistant to GM, GM, Chairman of the
Board and GM of Shenzhen Konka Telecommunication Technology Co., Ltd and Assistant to
President and vice president of Konka Group etc. He now is acting as Vice President of Konka
Group.
Wu Yongjun, male, Han nationality, born in 1975, was the Board Secretary with a master degree.
Formerly he worked as the senior manager of Secretariat, assistant to the chief, vice chief, chief,
Securities Affairs representative and Board Secretary in Konka Group. Presently he is working as
the secretary of the board of directors of Konka Group.
Li Chunlei, male, Han nationality, born in 1973, was the CFO of the Company with a master degree.
Once served as the director in Real Estate Business Division in Konka Group, vice GM and GM in
Kunshan Kangsheng Investment Development Co., Ltd., deputy director (preside the work) and
director in Strategic Development Center, GM in Financial Center and GM in Asset Settlement
Center and CFO of Konka Group. now he acts as the CFO in Konka Group.
Yang Bo, male, Han nationality, born in 1970, was the vice president of the Company with a master
degree. Once served as the director in Shenzhen Cable Television Education Financial Channel,
director in the market sales and support region of US Tailiyang Communications Company, GM in
Program Operating Department in Shenzhen Topway Video Communication Co., Ltd., director and
GM in Shenzhen Tianhua Century Media Co., Ltd., GM in Market Sales Center in Shenzhen
Topway Video Communication Co., Ltd. and vice president of Konka Group. Now he acts as the
vice president in Konka Group.
Cao Shiping, male, Han nationality, born in 1978, was the vice president of the Company with a
master degree. Once served as the GM in Jinzhou Branch and Tianjin Branch of Konka Group
Multi-media, GM in Multi-media Business Division Customer Cooperation Department, vice GM
in Multi-media Marketing Business Division, vice GM in Multi-media Business Division and GM
in Marketing Center, GM in Multi-media Business Division, GM in Internet Business Division and
vice president of Konka Group. Now he acts as the vice president in Konka Group.
Sun Qingyan, a male senior economist, Han nationality, born in 1972, was the vice president of the
Company with a doctor degree. Once served as the tutor in Northeast University of Finance and
Economies, vice GM in Shenzhen Huaixin Enterprise Investment Consulting Co., Ltd., CEO in
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Konka Group Co., Ltd. Annual Report 2020
Shenzhen Xinheng Lida Capital Management Co., Ltd., vice GM in Shanying Investment
Management Co., Ltd., GM in Shenzhen Shenwo Asset Management Co., Ltd. and vice president of
Konka Group. He now acts as the vice president of Konka Group.
Offices held concurrently in shareholding entities:
√Applicable □Not applicable
Remuneration or
Office held in the allowance from
Name Shareholding entity Start of tenure End of tenure
shareholding entity the shareholding
entity
Party Committee
Liu
OCT Group Standing Committee 22 February 2016 Yes
Fengxi
and vice GM
Liu Shenzhen Konka Holding Group
Director and GM 14 April 2020
Fengxi Co., Ltd.
Party Committee
Yao
OCT Group Standing Committee July 2020 Yes
Wei
and Chief Accountant
Zhang OCT (Yunnan) Investment Co.,
Director 18 January 2018
Jing Ltd
Zhang Deputy General
OCT West Investment Co., Ltd. 14 March 2019 Yes
Jing Manager
Zhang Xi’an Fengdong OCT
Director, GM 14 March 2019
Jing Development Co., Ltd
Zhang OCT (Xi'an) Development Co., Executive Director,
9 August 2019
Jing Ltd GM
Zhou Shenzhen Konka Holding Group
Director 9 14 April 2020
Bin Co., Ltd.
GM of Legal
Cai
OCT Group Compliance December 2020 Yes
Weibin
Department
Yang Full-time director in
OCT Group 7 March 2018 Yes
Guobin Board Office
1. Except the above situation, other directors, supervisors and senior management didn’t hold any position in
the shareholders’ units.
Notes
2. It is unknown the ending date of the posts of Mr. Liu Fengxi, Mr. Yao Wei, Mr. Zhang Jing, Mr. Cai Weibin,
Mr. Zhou Bin and Mr. yang Guobin held in the shareholders’ units.
Offices held concurrently in other entities:
√Applicable □Not applicable
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Konka Group Co., Ltd. Annual Report 2020
Remuneration or
Office held
Name Other entity Start of tenure End of tenure allowance from the
in the entity
entity
Wang
School of Economics of Peking
Shugua Professor Yes
University
ng
Wang
Institute for Cultural Industries of Deputy
Shugua
Peking University director
ng
Deng
Zhongnan University of
Chunhu Professor Yes
Economics and Law
a
Deng
Zhejiang Goldensea Hi Tech Independent
Chunhu 15 May 2019 Yes
Co.,Ltd director
a
Deng
Zhejiang Jinke Culture Industry Independent
Chunhu Yes
Co., Ltd. director
a
Deng
Independent
Chunhu Wolong Electric Group Co., Ltd. Yes
director
a
Punishments imposed in the recent three years by the securities regulator on the incumbent directors,
supervisors and senior management as well as those who left in the Reporting Period:
□ Applicable √ Not applicable
IV Remuneration of Directors, Supervisors and Senior Management
Decision-making procedure, determination basis and actual payments of remuneration for directors,
supervisors and senior management:
The salary of directors and supervisors of the Company should be submitted to the shareholders
meeting for review after the approval and consent by the Board of directors. Referred to the salary
level of the Directors and Supervisor of the domestic listed companies of same industry, the salary
proposal of the Director and Supervisors of the Company which approved and reviewed by the 2nd
Extraordinary General Meeting of 2015 were as follows: (1) the basic annual salary standard of the
Board Chairman was of RMB1.2 million, the subsidy standard of other Directors (excluding the
Directors serving in the Company) was of RMB0.3 million per person per year and the subsidy
standard of the Supervisors (excluding the Employee Supervisors) was of RMB0.2 million per
person per year; which was executed since June 2015. (2) the above standards were all pre-tax
standard with the individual income tax burdened in person as well as the Company withheld and
remitted tax.
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Konka Group Co., Ltd. Annual Report 2020
Other treatment for independent directors: travel expense when they went to attend the Board
sessions, Supervisory sessions or Shareholders’ General Meetings and the expenses when they were
performing their duties as stipulated in the relevant regulations and the Articles of Association and
other relevant systems, all these could be reported for deletion.
The Board of Directors determined the remuneration of senior management staffs referring to the
following factors: a. scope of jobs and responsibility shouldered; b. actual profit of the Company; c.
market remuneration level in the same industry and same area.
Remuneration of the directors, supervisors and senior management of the Company during the
Reporting Period
Unit: RMB'0,000
Total
Any
before-tax
Incumbent/For remuneration
Name Office title Gender Age remuneration
mer from related
from the
party
Company
Chairman of the Board and
Liu Fengxi Male 49 Incumbent Yes
CEO
Yao Wei Director Male 46 Incumbent Yes
Zhang Jing Director Male 39 Incumbent Yes
Zhou Bin Director and president Male 42 Incumbent 613.46 No
Sun
Independent director Male 66 Incumbent 30 No
Shengdian
Wang
Independent director Male 50 Incumbent 30 No
Shuguang
Deng
Independent director Female 58 Incumbent 30 No
Chunhua
Chairman of the Supervisory
Cai Weibin Male 48 Incumbent Yes
Committee
Yang
Supervisor Male 52 Incumbent Yes
Guobin
Li Jun Employee supervisor Male 50 Incumbent 139.23 No
Li Hongtao Vice president Male 53 Incumbent 303.47 No
Wu
Board secretary Male 46 Incumbent 312.29 No
Yongjun
Li Chunlei CFO Male 48 Incumbent 347.14 No
Yang Bo Vice president Male 51 Incumbent 296.26 No
Cao Vice president Male 43 Incumbent 327.07 No
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Konka Group Co., Ltd. Annual Report 2020
Shiping
Sun
Vice president Male 49 Incumbent 292.28 No
Qingyan
He Haibin Director Male 47 Former Yes
Wang Chairman of the Supervisory
Male 60 Former Yes
Youlai Committee
He Jianjun Vice president Male 51 Former 232.67 Yes
Equity incentives for directors, supervisors and senior management in the Reporting Period:
□ Applicable □ Not applicable
V Employees
1. Number, Functions and Educational Backgrounds of Employees
Number of in-service employees of the Company as the parent 1,776
Number of in-service employees of major subsidiaries 15,440
Total number of in-service employees 17,216
Total number of paid employees in the Reporting Period 17,216
Number of retirees to whom the Company as the parent or its
0
major subsidiaries need to pay retirement pensions
Functions
Function Employees
Production 9,118
Sales 4,461
Technical 1,504
Financial 686
Administrative 1,447
Total 17,216
Educational backgrounds
Educational background Employees
Master and above 309
Bachelor 3,061
Junior college 4,966
High school and below 8,880
Total 17,216
2. Employee Remuneration Policy
The Company promulgated its remuneration system with the operating strategy of serving for the
enterprise development and enhancement, and the principle of deciding the remuneration according
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Konka Group Co., Ltd. Annual Report 2020
to the post, business performance and capabilities, as well as the market competitiveness and
internal fairness. And it decided the employee’s remuneration level according to its business
earnings, the posts and fulfillment of the business performance of the employee.
3. Employee Training Plans
The Company adhered to the people-oriented and paid special attention to cultivate the talents.
Surrounded by the business development and the construction of talent team, the Company actively
organized and carried out various training activities, and continuously perfected its talents
cultivation system, as well as further enhanced the employee’s professional skills and overall quality,
so as to strengthen the construction of management talents, professional talents and technical talents
teams.
In 2020, guided by closing to the business needs, the Company centralized the superior resources to
promote the cultivation of key talents. And it organized and carried out the open class project for all
the employees, and organized and carried out the new employee’s training & cultivation projects
respectively for the graduates from campus recruiting and personnel from social recruitment.
Meanwhile, it centralized to organize the pointed the training projects of general management skills
and post professional knowledge, etc for the personnel from marketing, R&D, manufacturing,
financial and human resources systems, so as to better complete its annual training plan.
4. Labor Outsourcing
□ Applicable √ Not applicable
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Konka Group Co., Ltd. Annual Report 2020
Part X Corporate Governance
I General Information of Corporate Governance
I General Information of Corporate Governance
In the Reporting Period, strictly in accordance with the Company Law, Securities Law of the PRC,
Code of Corporate Governance for Listed Companies, Share Listing Rules of Shenzhen Stock
Exchange and the relevant rules and regulations of the CSRC, the Company timely amended the
internal control systems such as the Articles of Association and Administrative Method on Provision
of External Financial Aids as well as Management System on Investors Relationship, continuously
perfected the corporate governance structure and standardized the Company’s operation. By the end
of the Reporting Period, the actual conditions of corporate governance basically met the
requirements of the regulatory documents in respect of corporate governance structure of listed
companies issued by CSRC.
(I) Shareholders and the Shareholders’ General Meeting
The Company drew up Articles of Association and Rules for Procedure of Shareholders’ General
Meeting, ensured that all shareholders, in particular medium and minor shareholders, enjoy legal
rights and equal standard. In the Reporting Period, the Company was able to publish announcement
on Shareholders’ General Meetings in advance, convened Shareholders’ General Meeting with
strictly accordance to relevant requirements, so as to enable the shareholders have their rights of
information to the Company’s material issues and the participation rights. In 2020, the Company
convened five Shareholders’ General Meeting in total. The Company seriously did well the
registration, arrangement and organization work for the Shareholders’ General Meeting before the
circular on convening the Shareholders’ General Meeting being published at the designated media.
The Company convened the Shareholders’ General Meeting at the office address of the Company
strictly in line with relevant stipulations, which was convenient in traffic, and the shareholders
could attend the session in accordance with their actual situation. The Company’s directors,
supervisors and senior management staffs made explanations and description for the shareholders’
questions and advices at the session.
(II) Controlling shareholder and the Company
In the Reporting Period, the controlling shareholders and actual controllers strictly regulated its
behavior and complied with laws in exercising their rights and obligations, not bypassed the
Shareholders’ General Meeting to intervene in the Company’s decisions and operations directly or
indirectly. The Company was separated from the controlling shareholders and actual controllers in
aspects of its business, personnel, assets, organ and finance, the Board of Directors, Supervisory
Committee and the internal departments of the Company functioned independently.
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Konka Group Co., Ltd. Annual Report 2020
(III) Directors and the Board of Directors
The number and structure of the Board Bureau of the Company were in compliance with laws and
regulations. The Company drew up Rules for Procedures of the Board Bureau, so as to ensure a
high efficient operation and scientific decision-making of the Board Bureau; the Company has set
up Independent Director System and engaged three independent directors. In the Reporting Period,
the number of directors and composition of the Board of Directors of the Company as well as the
procedure of selection was in accordance with the requirements of the rules and laws as well as
Articles of Association. The Company set up four special committees, which were Financial Audit
Committee, Nomination Committee, Remuneration & Appraisal Committee, Strategy Committee to
provide profession opinion for the decision of the Board of Directors. All the directors carried out
their work, fulfilled their duties and scrupulously attended the Board sessions in accordance with
Rules of Procedure for the Board of Directors, Rules for Independent Directors, etc. 16 Board
sessions were convened by the Company during the Reporting Period, which brought the
decision-making mechanism of the Board of Directors into full play.
(IV) Supervisors and supervisory committee
The Company has established Rules for Procedures of the Supervisory Committee, persons and
structure of the Supervisory Committee was in line with relevant laws and statutes, supervisors can
earnestly perform their responsibilities, independently and efficiently executed supervision and
check responsibilities with a spirit of being responsible to shareholders. In the Reporting Period, the
number of supervisors and composition of the Supervisory Committee of the Company as well as
their selecting procedure complied with the laws, regulations. In accordance with the requirement of
the Rules of Procedure for Supervisory Committee, the supervisors performed their duties in an
earnest and responsible manner, and exercised their functions of supervision on the decision-making
procedure of the Board of Directors, resolutions and the Company’s operation by law, and took
effective supervision over the Company’s significant events, related transactions, financial position,
as well as the legality and compliance on duty performance by the directors, president and other
senior management members.
(V) Performance Appraisal and Incentive & Restrictive Mechanism
The senior management staffs of the Company were recruited on an open basis and in compliance
with the laws and regulations. The Company has established and gradually improved the
performance appraisal standards and incentive & restrictive mechanism for senior management
staffs, so as to attract qualified personnel, and ensure the stability of senior management staffs.
(VI) Interested parties
During the Reporting Period, the Company fully respected and maintained the legal rights of the
interested parties, and realized the balance of interest among the parties such as society,
shareholders and employees, etc. Meanwhile, the Company protected the rights of the employees,
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Konka Group Co., Ltd. Annual Report 2020
promoted the environmental protection, and actively joined in the social benefit and charitable
cause so as to jointly promote sustainable and healthy development.
(VII) Information disclosure and transparency
The Company formulated the Management System for Investor Relations and the Management
System for Information Disclosure and the Rules on Implementation for Information Disclosure
Committee. And the Company designated specially-assigned person to take charge of the
information disclosure, and designated specialized department to be responsible for the reception of
shareholders and consultation, actively carrying out the work for investor relations management to
ensure equal access to information for all shareholders. The Company strictly complied with the
requirements of the laws, regulations and the Articles of Association to disclose its information as
required by the relevant regulations on an timely, honest, complete and accurate basis, to ensure the
accurate and timely information disclosure, while ensure equal access to information for all
shareholders.
(VIII) Non-standard governance
1. Type of non-standard governance matter existed
There was a situation that the Company disclosed undisclosed information.
2. Types and cycle of undisclosed information provided to the principal shareholder
The Company provided monthly financial data to the principal shareholder.
3. Reasons for the related non-standard governance existed
The Company submitted the undisclosed information such as monthly financial data to the
substantial shareholder directly administrated by the State-owned Assets Supervision and
Administration Commission of State Council in accordance with the managerial demand of
SASAC.
4. Impact on Company independence
After the self-inspection, the Company kept strictly to the requirements of “Notice on Strengthening
the Supervision of Listed Company’s Provision of Non-public Information to Substantial
Shareholders and Actual Controllers”, and “Supplementary Notice Concerning Strengthening the
Supervision of the Non-standard Governance Behavior of Listed Company's Provision of
Non-public Information to Substantial Shareholders and Actual Controllers”, while stringently
performed the necessary procedures. There existed no circumstances of substantial shareholder’s
abuse of control and disclosure of undisclosed information for insider trading, and hence, it has no
impact on the independence of the Company.
(IX) Development of company’s special governance activity, formulation and implementation
of registration and management system for the insider of inside information
1. Establishment and perfection of management system for the insider of inside information
To further standardize the company’s inside information management behavior, strengthen the
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Konka Group Co., Ltd. Annual Report 2020
company’s inside information confidential work, and maintain the fair principle of information
disclosure, the Company established Inside Information and Insider Management System in Konka
Group Co., Ltd. The Company strictly implements the system in the information disclosure work,
meanwhile, carefully implements the Company’s inside information and insider registration and
management method, registers the insider of inside information, and report to Shenzhen Stock
Exchange and Shenzhen Security Regulatory Bureau according to the provision.
The Company conducted the special inspection on the inside information management during the
occurrence of major event in 2020 and the annual report in 2020. After the inspection, the Company
actually realized that the insider of inside information strictly kept the confidential provision, did
not disclose, divulge and spread the Company’s inside information to the outside, the insider of
inside information did not buy and sell the Company’s share with the inside information before
disclosing the major sensitive information influencing the Company’s share price, there was no
investigation and rectification from the regulatory department during the editing, review and
disclosure of regular report and major event. Management Rules for Inside Information and Insider
Management System was implemented in place and controlled effectively.
2. Establishment and implementation of external information user’s management system
To strengthen the management on the reporting of Company’s inside information, the Company
establishes Inside Information Reporting Management System, and prescribes the inside
information reporting range, reporting procedure, responsibility division and other matters
according to Security Law in People’s Republic of China, Information Disclosure Management
Method in Listed Company, Inside Information and Insider Management System in Konka Group
Co., Ltd. and other related provisions in the laws, regulations and regulatory documents.
The Company conducted the special inspection on the inside information reporting status during the
occurrence of major event in 2020 and the annual report in 2020. After the inspection, the
Company’s inside information reporting status complies with the requirements in Inside
Information Reporting Management System. Inside Information Reporting Management System
was implemented in place and controlled effectively.
Indicate by tick market whether there is any material incompliance with the regulatory documents
issued by the CSRC governing the governance of listed companies.
□ Yes √ No
No such cases in the Reporting Period.
II The Company’s Independence from Its Controlling Shareholder in Business, Personnel,
Asset, Organization and Financial Affairs
During the Reporting Period, the company was fully separated from the controlling shareholders in
terms of business, staff, assets, organs, and finance, which owned independent legal representative
and main status in market competition and had independent accounting, as well as possessed
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Konka Group Co., Ltd. Annual Report 2020
complete business and the ability of independent operation to face the market.
(I) Business: the Company owned complete supply, R&D, production and sales system, possessed
ability of independent operation to face the market by independent operation, independent
accounting & decision-making, independent bearing responsibility & risks, didn’t subject to the
interference and control of the controlling shareholders, actual controller and its controlled
enterprises.
(II) Staff: the Company was independent of the controlling shareholder with respect to labor,
personnel and salaries management. The Company owned independent team of staffs, the senior
management staff, financial personnel and business personnel received their remunerations in the
Company, and they were full-time staffs of the Company without holding any post, except directors
and supervisors, in shareholders’ units or other related enterprises.
(III) Assets integrity: the Company had production and operation premises completely separated
from the controlling shareholder, and the unaffiliated and integral assets structure, as well as the
independent production system, ancillary production system, the ancillary facilities, house property
right and other assets, which also possessed independent procurement and sales system.
(IV) Organ: the Company had its own functional organs adapting to the needs of self-development
and market competitiveness, all the functional organs were separated from each other in aspects of
personnel, office premises and management rules, etc., there existed no particulars about any
shareholders, other units or individuals interfering the organ setting of the Company.
(V) Finance: the Company established an independent finance department with full-time financial
personnel and an independent finance and accounting system, and independently carried out the
financial work in line with requirements of relevant accounting rules; the Company promulgated
sound financial management system to operate independently without sharing common accounts
with the controlling shareholder, related enterprise, other units or individual; the Company
independently declared and paid the tax by laws without particulars on paying taxes together with
shareholders’ units.
III Horizontal Competition
□ Applicable √ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Investor Index to
Meeting Type participati Date of the meeting Disclosure date disclosed
on ratio information
Annual
The 2019 Annual General http://www.cni
General 24.38% 18 May 2020 19 May 2020
Meeting nfo.com.cn/ne
Meeting
w/index
The 1st Extraordinary General Extraordinary 24.32% 22 June 2020 23 June 2020
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Konka Group Co., Ltd. Annual Report 2020
Meeting of 2020 General
Meeting
Extraordinary
The 2nd Extraordinary General
General 24.42% 10 August 2020 11 August 2020
Meeting of 2020
Meeting
Extraordinary
The 3rd Extraordinary General
General 24.43% 14 September 2020 15 September 2020
Meeting of 2020
Meeting
Extraordinary
The 4th Extraordinary General
General 24.52% 9 November 2020 10 November 2020
Meeting of 2020
Meeting
2. Special General Meetings Convened at the Request of Preferred Shareholders with
Resumed Voting Rights
□ Applicable √ Not applicable
V Performance of Duty by Independent Directors in the Reporting Period
1. Attendance of Independent Directors at Board Meetings and General Meetings
Attendance of independent directors at board meetings and general meetings
Total number
Board The independent
Indep of board Board meetings Board
Board meetings the director failed to
enden meetings the attended by way meetings General
meetings independent attend two
t independent of attended meetings
attended on director consecutive
direct director was telecommunicati through a attended
site failed to board meetings
or eligible to on proxy
attend (yes/no)
attend
Sun No
Sheng 16 2 14 0 0 3
dian
Wang No
Shug 16 2 14 0 0 0
uang
Deng No
Chun 16 2 14 0 0 0
hua
Why any independent director failed to attend two consecutive board meetings:
Not applicable.
2. Objections Raised by Independent Directors on Matters of the Company
Indicate by tick mark whether any independent directors raised any objections on any matter of the
Company.
□ Yes √ No
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Konka Group Co., Ltd. Annual Report 2020
No such cases in the Reporting Period.
3. Other Information about the Performance of Duty by Independent Directors
Indicate by tick mark whether any suggestions from independent directors were adopted by the
Company.
√ Yes □ No
Suggestions from independent directors adopted or not adopted by the Company:
During the Reporting Period, the Independent Directors of the Company vigorously attended the
relevant meetings, carefully reviewed each proposal, objectively stated their own views and
opinions, gained insight into the present situation of new businesses of the Company such as the
industry and Trade, semi-conductor, environment protection and advanced materials, the R&D and
brand building progress, the operating situation, and the execution situation of the internal control
construction and the resolutions of the meetings of the Board of Directors as well as the Annual
General Meeting.
As the expert of the involved each field, the Independent Directors put forward the constructive
advices by use of their own professional knowledge towards the internal management, including: to
actively promote the refinement and implementation of the Company’s development strategy plan,
provide advices on the expansion of businesses, focus on risk control matters such as cash flow and
accounts receivable management. The Company carefully adopted the advices from the
Independent Directors and constantly improved and enhanced the management level of the
Company.
VI Performance of Duties by Specialized Committees under the Board during this Reporting
Period
(I) Summary Report on the Performance of the Audit Committee Subject to the Board of
Directors
The Company had constituted the Work Rules for the Financial Audit Committee under the Board
which was revised in 2019 and illustrated the exact personnel, obligations and rights and working
process of annual report of the Financial Audit Committee under the Board. In 2020, based on the
principle of faithfulness, the major execution situations of the Financial Audit Committee under the
Board were as follows:
1. Reviewed financial statements of Annual Report 2019, First Quarter Report 2020, Interim Report
2020, and the Third Quarter Report 2020, and had no objection to the aforesaid financial statements.
2. Submitted the Proposal on Hiring CPA in 2020 to the Board on 10 April 2020 in which proposing
to continue to hire Shine Wing Certified Public Accountants as the audit institution of financial
statements of the Company in 2020.
3. During the preparation of Annual Report 2020 of the Company, it fulfilled the following duties:
(1) Issued the Notes of the Events such as the Audit Work Arrangement of the Financial Audit
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Konka Group Co., Ltd. Annual Report 2020
Committee and approved the arrangement for 2020 annual auditing of the Company;
(2) Issued Audit Opinion of the Financial Audit Committee on Financial Accounting Statements
Prepared by the Company before CPAs’ entry of Audit;
(3) Communicated and exchanged ideas with the CPAs responsible for annual auditing on the
problems occurring during the auditing;
(4) Issued Audit Opinion on Financial Accounting Statements of the Company after CPAs Issued
the Preliminary Audit Opinion;
(5) Supervised and urged CPAs in writing to submit he audit report within the agreed time period
for many times.
(6) Issued Summary Report on 2020 Annual Auditing by Shine Wing Certified Public Accountants;
(7) Submitted the Resolution of the 2020 Annual Financial Statement of the Company to the Board;
(8) Submitted the Proposal on Engagement of the CPAs in 2021 to the Board;
4. In 2020, according to the authorization of the Board of Directors, the Financial Audit Committee
accepted the report on the work of the Company’s Internal Auditing Department and carried out
management over the Internal Auditing Department of the Company and its work.
(II) Summary Report on the Performance of the Remuneration and Appraisal Committee
Subject to the Board of Directors
The Company had constituted the Work Rules for the Remuneration and Appraisal Committee
under the Board which illustrated the exact personnel, obligations and rights of the Remuneration
and Appraisal Committee under the Board. In 2020, based on the principle of faithfulness, the major
execution situations of the Remuneration and Appraisal Committee under the Board were as
follows:
1. On 14 August 2020, the Remuneration and Appraisal Committee subject to the Board of
Directors submitted the Audit Opinion on the Reward Planning for the Management of the
Company in 2019 to the Board.
2. During the preparation of Annual Report 2020, the Remuneration and Appraisal Committee
subject to the Board of Directors issued the Audit Opinion on the Disclosed Remuneration Situation
of the Directors, Supervisors and Senior Executives of the Company, which considered the
condition of the remuneration of the Directors, Supervisors and Senior Executives of the Company
disclosed in the 2020 Annual Report was verified. The disclosed remuneration situation of the
Directors, Supervisors and Senior Executives of the Company met with the remuneration
management system without any situation that violated the remuneration management system of the
Company.
(III) Summary report on performance of nomination committee of the Board of Directors
The Company formulated the Code of Practice of Nomination Committee of the Board of Directors,
which specifies members, responsibilities and authorities of the nomination committee of the Board
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Konka Group Co., Ltd. Annual Report 2020
of Directors. Main performance of the Company’s Nomination Committee of the Board of Directors
in 2020 includes:
1. Submission of Proposal on the Change of Senior Management to the Board of Directors of the
Company on 17 March 2020.
2. Submission of Approval Opinions on Co-opted Directors of the 9th Board of Directors to the
Board of Directors of the Company on 14 August 2020.
VII Performance of Duty by the Supervisory Committee
Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its
supervision in the Reporting Period.
□ Yes √ No
The Supervisory Committee raised no objections in the Reporting Period.
VIII Appraisal of and Incentive for Senior Management
In order to enable the senior management staffs of the Company give better performance of their
duties, and clarify their rights and obligations, the Company established and improved a fair,
transparent and efficient Performance Appraisal Standard and Incentive & Restraint Mechanism for
the senior management staffs. The Company assessed the duty performance and completion of
business of senior management staffs in terms of professional skills, management level and job
performance; took the salary plus bonus as a main incentive way, to improve the incentive of senior
management. The senior management staff was appraised by the Board of Directors, which was
supervised by the Supervisory Committee.
IX Internal Control
1. Material Internal Control Weaknesses Identified for the Reporting Period
□ Yes √ No
2. Internal Control Self-Evaluation Report
Disclosure date of the internal control self-evaluation report 24 March 2021
Index to the disclosed internal control self-evaluation report http://www.cninfo.com.cn/new/index
Evaluated entities’ combined assets as % of consolidated total assets 90.00%
Evaluated entities’ combined operating revenue as % of consolidated
90.00%
operating revenue
Identification standards for internal control weaknesses
Weaknesses in internal control not related to
Type Weaknesses in internal control over financial reporting
financial reporting
Those with the following characteristics should be recognized as great The following signs indicated there may exist
Natur
defect: (1) found out there were malpractices of the Directors, great defect among the internal control of the
e
Supervisors and Senior Executives of the Company that formed non-financial report; (1) the operating
stand
significant influences on the financial report; (2) the Company revised activities of the enterprises seriously violated
ard
the published financial report and revised the great misstatements the national laws and regulations; (2) negative
126
Konka Group Co., Ltd. Annual Report 2020
caused by the malpractices or the mistakes; (3) CPA found out there news frequently disclosed by the media which
was great misstatement of the current financial report while didn’t caused significant harm to the Company’s
found during the operating process of the internal control; (4) the reputation; (3) the core management team left
supervision of the internal control by the Finance Audit Committee their positions one after another or the outflow
and the internal audit institution of the Company was invalid; (5) not of the key position personnel was serious; (4)
yet revised the great defect after the reasonable period as which was significant business lacked of systematic
discovered among the internal control assessment; (6) the significant control of the system was invalid; (5) great
business lacked of systematic control or the systematic control was defect discovered among the internal control
invalid.. Those with the following characteristics should be recognized assessment not yet be revised in time. The
as significant defect: (1) not yet chosen or applied the accounting following signs indicated there may exist
polices according to the generally accepted accounting standards; (2) significant defect among the internal control
not yet constructed the anti-spam process or control measures; (3) as of the non-financial report: (1) negative news
for the accounts disposal of the unconventional or special transactions, occurred rather frequently which caused
there was no corresponding control mechanism or execution or the rather big harm to the Company’s reputation;
existence of the corresponding supplement control; (4) there was one (2) the outflow of the key position personnel
or multiple defects during the control of the compile of the financial was rather serious; (3) there was obvious
report at the period-end and could not reasonable guarantee the defect among the control system of the
statement of the compiled financial report reach the real and accurate significant business; (4) the significant defect
target; (5) not yet revised the significant defect after the reasonable found among the internal control assessment
period as which was discovered among the internal control assessment. not yet be revised in time. 3. Other defects
3. Other defects from the internal control hadn’t reached the from the internal control hadn’t reached the
recognition standards of the great defect or significant defect should be recognition standards of the great defect or
recognized as general defect. significant defect should be recognized as
general defect.
Great defect: potential misstatement amount≥1% of the gross profit
margin of the 2020 consolidated financial report of the Company;
Quan
significant defect: 0.5% of the gross profit margin of the 2020
titativ Implement in accordance with the quantitative
consolidated financial report of the Company ≤potential misstatement
e criteria of internal control defect evaluation in
amount ＜ 1% of the gross profit margin of the 2020 consolidated
stand financial statements
financial report of the Company; general defect: potential
ard
misstatement amount ＜ 0.5% of the gross profit margin of the 2020
consolidated financial report of the Company.
Number of material weaknesses in internal control over financial reporting 0
Number of material weaknesses in internal control not related to financial
0
reporting
Number of serious weaknesses in internal control over financial reporting 0
Number of serious weaknesses in internal control not related to financial
0
reporting
X Independent Auditor’s Report on Internal Control
√ Applicable □ Not applicable
Opinion paragraph in the independent auditor’s report on internal control
We considered that, in all the significant aspects, Konka Group maintained efficient internal control of the financial report
127
Konka Group Co., Ltd. Annual Report 2020
according to the C-SOX and the relevant regulations on 31 December 2020.
Disclosure date 24 March 2021
Index to such report disclosed http://www.cninfo.com.cn/new/index
Type of the auditor’s opinion Unmodified unqualified opinion
Material weaknesses in internal
control not related to financial None
reporting
Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s report
on the Company’s internal control.
□ Yes √ No
Indicate by tick mark whether the independent auditor’s report on the Company’s internal control is
consistent with the internal control self-evaluation report issued by the Company’s Board.
√ Yes □ No
128
Konka Group Co., Ltd. Annual Report 2020
Part XI Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were
outstanding before the date of this Report’s approval or were due but could not be redeemed in full?
Please refer to the relevant information disclosed.
I. Basic Information of the Corporate Bonds
Bonds
Coup
balance Way of
Name Abbr. Code Release date Due date on
(RMB’0, redemption
rate
000)
Interests shall
be paid every
Privately placed corporate bonds 19
11441 14 January 14 January 5.00 year and the
in 2019 of Konka Group Co., Ltd Konka -
8 2019 2022 % principals
(Tranche I) (Variety I) 01
shall be repaid
when expired.
Interests shall
be paid every
Privately placed corporate bonds 19
11442 14 January 14 January 5.00 year and the
in 2019 of Konka Group Co., Ltd Konka 150,000
3 2019 2022 % principals
(Tranche I) (Variety II) 02
shall be repaid
when expired.
Interests shall
be paid every
Privately placed corporate bonds 19
11448 4.50 year and the
in 2019 of Konka Group Co., Ltd Konka 3 June 2019 3 June 2022 50,000
8 % principals
(Tranche II) (Variety I) 03
shall be repaid
when expired.
Interests shall
be paid every
Privately placed corporate bonds 19
11448 4.70 year and the
in 2019 of Konka Group Co., Ltd Konka 3 June 2019 3 June 2022 50,000
9 % principals
(Tranche II) (Variety II) 04
shall be repaid
when expired.
Interests shall
Privately placed corporate bonds 19 be paid every
11452 4.53
in 2019 of Konka Group Co., Ltd Konka 22 July 2019 22 July 2022 80,000 year and the
3 %
(Tranche III) (Variety I) 05 principals
shall be repaid
129
Konka Group Co., Ltd. Annual Report 2020
when expired.
Interests shall
be paid every
Privately placed corporate bonds 19
11452 4.70 year and the
in 2019 of Konka Group Co., Ltd Konka 22 July 2019 22 July 2022 70,000
4 % principals
(Tranche III) (Variety II) 06
shall be repaid
when expired.
Interests shall
be paid every
Privately placed corporate bonds 21
11489 8 January 8 January 4.46 year and the
in 2021 of Konka Group Co., Ltd Konka 100,000
4 2021 2024 % principals
(Tranche I) 01
shall be repaid
when expired.
Listed or transferred trading place of the
Shenzhen Stock Exchange
Company bonds
“19 Konka 01”, ” 19 Konka 02”, “19 Konka 03”, “19 Konka 04”, “19 Konka
05”, “19 Konka 06” were placed privately to qualified institutional investors
meeting the requirements of management method for investors eligibility in
Appropriate arrangement of the investors bonds market of Shenzhen Stock Exchange, and “21 Konka 01” was placed
privately to professional investors meeting the requirements of management
method for investors eligibility of Shenzhen Stock Exchange, which not
exceeding 200 persons .
During the Reporting Period, as for “19 Konka 01”, ” 19 Konka 02”, “19
Konka 03”, “19 Konka 04”, “19 Konka 05” and “19 Konka 06”, interest has
Interest payment during the Reporting Period
been paid on schedule; as for “21 Konka 01”, the first interest payment date
did not arrive.
1. Option for issuer to adjust coupon rate; 2. Put-backs option for investors;
there was no implementation of relevant clauses. The option to adjust coupon
Execution of the relevant regulations during
rate and investors’ put option of “19 Konka 01” were implemented on 14
the Reporting Period such as the affiliated
January 2021. Details are as follows: the issuer adjusted the coupon rate of last
option clause of the issuers or investors,
year of “19 Konka 01” to 2.80%. Put option of “19 Konka 01” reached
special clauses such as the exchangeable
10,000,000, with an amount of RMB1,000,000,000.00. Put option principal
regulations of the Company bonds (if
and current interest were fully transferred to the account designated by China
applicable)
Securities Depository and Clearing Corporation Limited. “19 Konka 01” were
put in full and delisted from the exchange.
II. List of the Bond Trustee and the Rating Organization
Bond trustee:
Room 601, No. 35 Pu Hang, and
Nam Industrial Securities Co., Office Contact Contact 010-5091120
Jinshifang Street, Zhang
e Ltd address person number 3
Xicheng District, Huifang
130
Konka Group Co., Ltd. Annual Report 2020
Beijing
Rating organization executed the tracking rating of the corporate bonds of the Reporting Period:
Nam Office No.2 Jianwai Street, Chaoyang District,
United Ratings Co., Ltd.
e address Beijing
Alternation reasons, execution process and influences on the investors’ interests
etc. if there was alternation of the bond trustees and the credit rating agencies No
engaged by the Company during the Reporting Period (if applicable)
III. List of the Usage of the Raised Funds of the Corporate Bonds
The Company has used the raised funds and disclosed related information in a
timely, authentic, accurate and complete manner strictly in accordance with the terms
in the prospectus for current bonds, related provisions and requirements in the
List of the usage of the raised funds and Measures for Issuance and Trading of Corporate Bonds, CSRC Releases No. 2
the execution process of the Company Guideline for the Supervision of Listed Companies-Administration of Funds Raised
bonds by Listed Companies and Applicable Supervision Requirements, the Stock Listing
Rules of the Shenzhen Stock Exchange and Guidelines for Standardized Operation of
Listed Companies in Shenzhen Stock Exchange. It has not engaged in any violations
in respect of the use and management of the raised funds.
Ending balance (RMB'0,000) 0
Operating situation of the raised funds The operation was in good condition without any violations for relevant regulations
special account or capital supervision agreement
Whether the usage of the raised funds
met with the usage, using plan and other Yes
agreements committed on the prospectus
IV. Rating Situation of the Corporate Bonds Information
In June 2020, United Credit Ratings Co., Ltd. made the tracking rating for the entity and relevant
bonds (including “19 Konka 01”, “19 Konka 02”, “19 Konka 03”, “19 Konka 04”, “19 Konka 05”
and “19 Konka 06”) of the Company. The entity of the Company was rated as Grade AA invariably
and as “Stable” for its rating prospect; the bonds “19 Konka 01”, “19 Konka 02”, “19 Konka 03”,
“19 Konka 04”, “19 Konka 05” and “19 Konka 06” issued by Konka Group Co., Ltd. were rated as
Grade AAA invariably for their credit and as “Stable” for their rating prospect. In December 2020,
United Credit Ratings Co., Ltd. made the tracking rating for the entity and “21 Konka 01” of the
Company. The entity of the Company was rated as Grade AA and as “Stable” for its rating prospect;
the bonds “21 Konka 01” issued by Konka Group Co., Ltd. were rated as Grade AAA for their
credit and as “Stable” for their rating prospect. The tracking rating result is consistent with that
issued at the time of corporate bonds issuance. The related rating report has been published on the
website of Shenzhen Stock Exchange.
131
Konka Group Co., Ltd. Annual Report 2020
V. Credit-adding Mechanism, Repayment Plan and Other Repayment Guarantee Measures of
the Corporate Bonds
OCT Group provided the unconditional and irrevocable joint liability guarantee in full amount for
the bonds “19 Konka 01”, ” 19 Konka 02”, “19 Konka 03”, “19 Konka 04”, “19 Konka 05”, “19
Konka 06” and “21 Konka 01” in the Reporting Period.
VI. Convene Situation of the Bonds Holders Meeting during the Reporting Period
No bonds holders meeting was convened during the Reporting Period.
VII. List of the Duty Execution of the Bonds Trustee during the Reporting Period
During the Reporting Period, Industrial Securities Co., Ltd., the Company’s bond trustee manager,
proactively performed its trusteeship, continued to be concerned with the Company’s routine
production and operation and financial conditions, and endeavored to maintain the legitimate rights
and interests of the bond holder strictly in accordance with related laws, regulations, the
Management Measures for the Issue and Trading of Corporate Bonds, the Prospectus and the
Agreement for the Bond Trusteeship Management.
VIII. The Major Accounting Data and the Financial Indicators of the Recent 2 Years of the
Company up the Period-end
Unit: RMB’0,000
Item 2020 2019 Change (%)
EBITDA 180,180.33 164,356.08 9.63%
Current ratio 93.18% 114.80% -21.62%
Debt/asset ratio 78.51% 76.69% 1.82%
Quick ratio 76.42% 90.78% -14.36%
Debt/EBITDA ratio 7.61% 7.56% -0.05%
Times interest earned 1.40 1.42 -1.41%
Times interest earned of cash 1.63 -0.61 -367.21%
Times interest earned of
1.92 1.89 1.59%
EBITDA
Loan repayment rate 100.00% 100.00% 0.00%
Interest coverage 100.00% 100.00% 0.00%
Main reason of the above accounting data and the financial indicators with the YoY change
exceeded 30%
√ Applicable □ Not applicable
The remarkable change of times interest earned of cash is due to the sharp improvement of cash
flow from operating activities.
132
Konka Group Co., Ltd. Annual Report 2020
IX. List of the Interest Payment of Other Bonds and Debt Financing Instruments during the
Reporting Period
Except for above corporate bonds, there are no other bonds and debt financing instruments for the
Company during the Reporting Period.
X. List of the Acquired Bank Credit Lines, Usage and the Repayment of the Bank Loans
As of the end of the Reporting Period, the Company acquired bank credit lines of RMB24.65 billion,
and used RMB11.546 billion. All bank loans can be repaid on schedule without any overdue
situations.
XI. List of the Execution of the Agreements or the Commitments Related to the Company
Bonds Raising Specification during the Reporting Period
During the Reporting Period, the Company strictly observed the agreements and performed the
commitments related to the Company Bonds raising specification.
XII. Significant Events Occurring during the Reporting Period
During the Reporting Period, the Company has timely disclosed current announcements regarding
significant events occurring the website of Shenzhen Stock Exchange (http://www.szse.cn/) and
cninfo (http://www.cninfo.com.cn/new/index). As of the disclosure date of this Report, related
significant events have no subsequent progress yet.
XIII. Whether there Was Guarantor of the Corporate Bonds
√ Yes □ No
Whether the guarantor of the corporate bonds was legal person or other organizations
√ Yes □ No
Whether separately disclose the financial statements (including Balance Sheet, Income Statement,
Cash Flow Statement, and Changes in owners’ (shareholders’) Equity, and notes for Financial
Statements) of guarantor in the Reporting Period within 4 months from the ending date of every
accounting year
□ Yes √ No
133
Konka Group Co., Ltd. Annual Report 2020
Part XII Financial Statements
I Independent Auditor’s Report
Type of the independent auditor’s opinion Unmodified unqualified opinion
Date of signing this report 22 March 2021
ShineWing Certified Public Accountants (Special General
Name of the independent auditor
Partnership)
Reference number of audit report XYZH/2021GZAA70014
Name of the certified public accountants Guo Dongchao, Zhan Miaoling
Independent Auditor’s Report
XYZH/2021GZAA70014
All shareholders of Konka Group Co., Ltd.
I. Opinion
We have audited the accompanying financial statements of Konka Group Co., Ltd. (the
“Company”), which comprise the Company’s and consolidated balance sheets of the parent
company as at 31 December 2020, the Company’s and consolidated income statements of the parent
company, the Company’s and consolidated cash flow statements of the parent company, the
Company’s and consolidated statements of changes in shareholders’ equity of the parent company
for the year then ended, as well as the notes to the financial statements.
In our opinion, the financial statements attached were prepared in line with the regulations of
Accounting Standards for Business Enterprises in all significant aspects which gave a true and fair
view of the consolidated and parent financial position of the Company as at 31 December 2020 and
the consolidated and parent business performance and cash flow of the Company for 2020.
II. Basis for Opinion
We conducted our audit in accordance with Standards on Auditing for Certified Public Accountants.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of our report. In accordance with professional ethics
for certified public accountants, we are independent with Foshan Huaxin Packing Co., Ltd. and we
have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the Current Period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and
134
Konka Group Co., Ltd. Annual Report 2020
we do not provide a separate opinion on these matters.
1. Recognition of operating revenues
Key audit matters Countermeasures of audit
Please refer to the notes to the financial (1) Evaluate and test income to confirm the effectiveness of key internal control design
statements "six, notes to the and operation;
consolidated financial statements" 46.In (2) Select samples to check supporting documents such as sales contracts, construction
2020, Konka Group's consolidated contracts, sales support documents, orders, invoices, delivery receipts, cargo rights
financial statements confirmed operating transfer vouchers, bank transfer vouchers, invoices, customs declarations, etc.
income of RMB5,035,183.66, the mainly Accounting policies identify contract terms and conditions related to risks and reward
revenue comes from the electronic transfers in commodity ownership, check whether the company is the main responsible
business, trading business,and person or agent in the sales business, and evaluate whether the company's revenue
environmental protection business, confirms that the accounting policies meet the requirements of the enterprise accounting
environmental protection business, etc. standards;
Due to the importance of revenue to the (3) Perform analytical procedures on revenue and costs, analyze the fluctuations and
financial statements as a whole for causes of sales prices this year, and evaluate the rationality of sales gross profit margin
implementing the new standards changes;
governing revenue, and the inherent (4) According to the characteristics and nature of the customer's transaction, select
misstatement risk of management's important customers to implement the letter and letter procedure for the transaction
manipulation of revenue recognition in amount and the balance of the transaction, and strictly control the letter and letter
order to achieve specific goals or procedure;
expectations, we make revenue (5) For environmental protection projects, obtain engineering measurement payment
recognition a key audit matter. certificates and other documents; for major projects, check the progress of the image on
the spot;
(6) Select samples of important customers and suppliers to check industrial and
commercial information and background, and evaluate the commercial rationality of
transactions with customers; entrust lawyers to check whether there is an association
between important overseas customers and suppliers. Visit customers and suppliers with
large amounts on the spot;
(7) For environmental protection projects, obtain engineering measurement payment
certificate and other documents, and observe the image progress of main projects on site.
(8)Conduct a cut-off test on sales revenue.
2. Recognition of investment income
Key audit matters Countermeasures of audit
Please refer to the notes to the financial (1) Evaluate and test the effectiveness of management's key internal control design and
statements "six, notes to the operation related to investment;
consolidated financial statements"53In (2) Interview the company's management and the transferee to understand the business
135
Konka Group Co., Ltd. Annual Report 2020
2020, Konka Group's consolidated background of the equity transfer, whether the transfer is true, whether there are other
financial statements confirmed agreements, and whether it constitutes a package transaction;
investment income of RMB243,333.60 (3) Understand the method of equity sale and check the setting of listing conditions;
Mainly for the disposal of investment (4) Check the contract terms of the equity transfer, the equity structure of the subsidiary
income generated by long-term equity before and after the loss of control, the appointment of major directors and supervisors,
investment, the gains from the changes in the board of directors, major resolutions, changes in the main management,
remeasurement of the remaining equity and the main body of performance evaluation before and after the transfer
after the loss of control rights at fair (5) Check the recovery of equity transfer funds;
value. Since the amount of investment (6) Review the fairness of the equity transaction consideration, review the judgment of
income has a significant impact on loss of control and the remaining equity to be recognized at fair value measurement after
profits, professional judgment is required loss of control;
on the date of loss of control, so we (7) Review the calculation process of the company's equity transfer investment income
confirm the confirmation of investment to check whether the investment income is calculated correctly.
income as a key audit matter.
IV. Other Information
The management of the Company is responsible for the other information. The other information
comprises all of the information included in the annual report for 2020 other than the financial
statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the audit or otherwise appears to be
materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
V. Responsibility of Management and Those Charged with Governance for the Financial
Statements
The management of the Company is responsible for the preparation and fair presentation of these
financial statements in accordance with Accounting Standards for Business Enterprises to make
them a fair presentation and designing, implementing and maintaining internal control relevant to
the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the management of the Company is responsible for assessing
the Company’s ability to continue as a going concern, disclosing, if applicable, matters related to
going concern and using the going concern basis of accounting unless the management either
intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
136
Konka Group Co., Ltd. Annual Report 2020
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
VI. CPA’s Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. We report our opinion solely to you, as a body, and for no other purpose.
We do not assume responsibility towards or accept liability to any other person for the contents of
this report. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with auditing standards will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken
on the basis of these financial statements.
As part of an audit in accordance with auditing standards, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of major misstatement of financial statements due to fraud or errors,
design and implement audit procedures to deal with these risks, and obtain sufficient and
appropriate audit evidence as the basis for issuing audit opinions. Since fraud may involve collusion,
forgery, intentional omissions, misrepresentation, or overriding internal control, the risk of failing to
detect a major misstatement due to fraud is higher than the risk of failing to detect a major
misstatement due to error.
(2) Understand the internal control related to auditing in order to design appropriate auditing
procedures.
(3) Evaluate the appropriateness of management's selection of accounting policies and the
rationality of accounting estimates and related disclosures.
(4) To draw conclusions on the appropriateness of the management's use of continuous operation
assumptions. At the same time, based on the audit evidence obtained, a conclusion can be drawn on
whether there is a material uncertainty that may cause significant doubts about Konka Group's
ability to continue operations. If we conclude that there are significant uncertainties, the auditing
standards require us to draw the attention of the users of the statements to the relevant disclosures in
the financial statements in the audit report; if the disclosures are insufficient, we should issue a
non-reserved opinion. Our conclusion is based on the information available as of the date of the
audit report. However, future events or circumstances may prevent Konka Group from continuing
its operations.
(5) Evaluate the overall presentation, structure, and content of the financial statements, and evaluate
whether the financial statements fairly reflect related transactions and events.
(6) Obtain sufficient and appropriate audit evidence on the financial information of the entities or
137
Konka Group Co., Ltd. Annual Report 2020
business activities in Konka Group to express audit opinions on the financial statements. We are
responsible for guiding, supervising and executing group audits, and assume full responsibility for
audit opinions.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
related safeguards (if applicable).
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the financial statements of the Current Period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances,
we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of
such communication.
ShineWing Certified Public Accountants CPA: (Engagement Partner)
(Special General Partnership)
CPA:
BeijingChina 22 March 2021
II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by Konka Group Co., Ltd.
31 December 2020
Unit: RMB
Item 31 December 2020 31 December 2019
Current assets:
Monetary assets 5,431,530,180.90 6,599,360,051.61
Settlement reserve
Interbank loans granted
138
Konka Group Co., Ltd. Annual Report 2020
Held-for-trading financial assets 618,249,541.66 61,494,666.97
Derivative financial assets
Notes receivable 2,358,180,193.96 2,838,041,432.89
Accounts receivable 3,900,897,623.59 4,416,179,657.87
Accounts receivable financing 84,057,197.44 143,174,271.82
Prepayments 1,183,270,543.41 2,072,550,811.86
Premiums receivable
Reinsurance receivables
Receivable reinsurance contract reserve
Other receivables 2,145,736,640.60 1,772,183,366.49
Including: Interest receivable 45,109,425.85 7,807,400.40
Dividends receivable 4,947,848.62 547,848.62
Financial assets purchased under resale agreements
Inventories 4,521,300,677.41 5,318,503,044.69
Contract assets 2,870,006,710.39
Assets held for sale
Current portion of non-current assets 112,310,158.82 108,087,016.22
Other current assets 1,913,146,483.39 2,093,212,552.25
Total current assets 25,138,685,951.57 25,422,786,872.67
Non-current assets:
Loans and advances to customers
Investments in debt obligations
Investments in other debt obligations
Long-term receivables 399,497,204.03 410,509,555.85
Long-term equity investments 4,375,833,584.65 3,465,541,196.89
Investments in other equity instruments 25,343,293.16 21,642,170.36
Other non-current financial assets 1,878,154,796.76 1,753,121,727.83
Investment property 538,585,668.29 400,197,374.07
Fixed assets 3,178,642,017.84 2,561,254,191.55
Construction in progress 9,236,643,931.68 4,291,544,368.52
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 1,189,191,001.51 1,213,271,713.22
139
Konka Group Co., Ltd. Annual Report 2020
Development costs
Goodwill 675,795,873.17 779,260,296.41
Long-term prepaid expense 153,198,562.82 107,590,078.88
Deferred income tax assets 1,265,916,437.39 987,763,182.17
Other non-current assets 1,820,779,170.74 1,172,472,723.85
Total non-current assets 24,737,581,542.04 17,164,168,579.60
Total assets 49,876,267,493.61 42,586,955,452.27
Current liabilities:
Short-term borrowings 10,990,550,475.78 10,332,687,239.63
Borrowings from the central bank
Interbank loans obtained
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 1,335,987,026.21 1,319,396,374.37
Accounts payable 9,632,366,325.76 5,797,822,479.60
Advances from customers - 1,076,856,387.08
Contract liabilities 1,217,367,735.94
Financial assets sold under repurchase agreements
Customer deposits and interbank deposits
Payables for acting trading of securities
Payables for underwriting of securities
Employee benefits payable 476,616,244.45 426,870,498.58
Taxes payable 508,214,059.16 607,845,294.99
Other payables 1,999,430,899.69 2,374,287,243.20
Including: Interest payable 220,837,380.17 227,831,108.53
Dividends payable
Handling charges and commissions payable
Reinsurance payables
Liabilities directly associated with assets held for sale
Current portion of non-current liabilities 376,896,566.29 210,066,077.13
Other current liabilities 441,774,317.23
Total current liabilities 26,979,203,650.51 22,145,831,594.58
Non-current liabilities:
Insurance contract reserve
140
Konka Group Co., Ltd. Annual Report 2020
Long-term borrowings 5,964,748,997.54 4,890,315,729.90
Bonds payable 4,993,212,788.32 4,987,709,643.64
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables 481,409,849.96 383,287,104.62
Long-term employee benefits payable 5,248,309.14 5,565,646.72
Provisions 102,353,567.91 206,591.51
Deferred income 446,900,524.64 151,874,258.45
Deferred income tax liabilities 75,819,231.93 95,467,096.05
Other non-current liabilities 106,475,449.02
Total non-current liabilities 12,176,168,718.46 10,514,426,070.89
Total liabilities 39,155,372,368.97 32,660,257,665.47
Owners’ equity:
Share capital 2,407,945,408.00 2,407,945,408.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 230,185,310.09 230,368,577.09
Less: Treasury stock
Other comprehensive income -16,583,042.42 -21,293,103.52
Specific reserve
Surplus reserves 1,211,721,109.67 1,211,721,109.67
General reserve
Retained earnings 4,595,371,391.63 4,239,763,606.89
Total equity attributable to owners of the Company as the
8,428,640,176.97 8,068,505,598.13
parent
Non-controlling interests 2,292,254,947.67 1,858,192,188.67
Total owners’ equity 10,720,895,124.64 9,926,697,786.80
Total liabilities and owners’ equity 49,876,267,493.61 42,586,955,452.27
Legal representative: Liu Fengxi CFO: Li Chunlei
Head of the financial department: Guo Zhihua
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item 31 December 2020 31 December 2019
141
Konka Group Co., Ltd. Annual Report 2020
Current assets:
Monetary assets 3,481,445,560.17 2,498,077,198.12
Held-for-trading financial assets 298,497,458.33 61,494,666.97
Derivative financial assets
Notes receivable 879,589,355.91 2,148,312,821.38
Accounts receivable 4,473,251,691.85 9,564,720,940.39
Accounts receivable financing 5,659,400.00 66,002,903.68
Prepayments 1,021,218,285.46 911,315,168.95
Other receivables 10,034,869,353.07 10,552,820,915.47
Including: Interest receivable 41,138,869.97 7,431,353.86
Dividends receivable 749,431,635.50 518,580,871.02
Inventories 202,406,456.36 218,644,308.47
Contract assets
Assets held for sale
Current portion of non-current assets
Other current assets 1,020,031,186.39 1,096,689,897.40
Total current assets 21,416,968,747.54 27,118,078,820.83
Non-current assets:
Investments in debt obligations
Investments in other debt obligations
Long-term receivables
Long-term equity investments 8,806,166,599.56 7,712,084,967.88
Investments in other equity instruments 17,940,215.36 12,940,214.36
Other non-current financial assets 250,230,000.00 250,230,000.00
Investment property 406,237,236.91 400,197,374.07
Fixed assets 431,762,044.14 444,107,402.57
Construction in progress 132,464,938.18 40,933,270.51
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 59,506,272.63 80,470,750.60
Development costs
Goodwill
Long-term prepaid expense 16,532,521.69 39,047,325.68
142
Konka Group Co., Ltd. Annual Report 2020
Deferred income tax assets 980,095,292.53 883,234,085.45
Other non-current assets 10,867,888.84
Total non-current assets 11,111,803,009.84 9,863,245,391.12
Total assets 32,528,771,757.38 36,981,324,211.95
Current liabilities:
Short-term borrowings 5,052,990,048.93 5,014,312,913.74
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 1,344,958,738.50 2,610,991,473.69
Accounts payable 6,811,467,585.39 11,078,648,690.19
Advances from customers 318,839,961.84
Contract liabilities 723,022,740.95
Employee benefits payable 147,391,317.06 125,402,307.95
Taxes payable 4,094,133.23 9,305,344.42
Other payables 4,275,347,622.57 3,193,392,734.69
Including: Interest payable 215,828,625.04 223,847,860.57
Dividends payable
Liabilities directly associated with assets held for sale
Current portion of non-current liabilities 5,867,425.49 130,512,375.00
Other current liabilities 6,108,675.36
Total current liabilities 18,371,248,287.48 22,481,405,801.52
Non-current liabilities:
Long-term borrowings 2,930,034,612.32 3,438,055,729.90
Bonds payable 4,993,212,788.32 4,987,709,643.64
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables 17,633,249.67 21,855,688.19
Long-term employee benefits payable
Provisions 832,465.72 206,591.51
Deferred income 61,530,557.55 59,545,839.30
Deferred income tax liabilities 2,334,364.58
Other non-current liabilities 54,162,098.05
Total non-current liabilities 8,059,740,136.21 8,507,373,492.54
143
Konka Group Co., Ltd. Annual Report 2020
Total liabilities 26,430,988,423.69 30,988,779,294.06
Owners’ equity:
Share capital 2,407,945,408.00 2,407,945,408.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 112,570,352.72 114,018,066.79
Less: Treasury stock
Other comprehensive income -2,682,217.31 -2,682,217.31
Specific reserve
Surplus reserves 1,227,564,785.19 1,227,564,785.19
Retained earnings 2,352,385,005.09 2,245,698,875.22
Total owners’ equity 6,097,783,333.69 5,992,544,917.89
Total liabilities and owners’ equity 32,528,771,757.38 36,981,324,211.95
3. Consolidated Income Statement
Unit: RMB
Item 2020 2019
1. Revenue 50,351,836,554.87 55,119,125,478.72
Including: Operating revenue 50,351,836,554.87 55,119,125,478.72
Interest income
Insurance premium income
Handling charge and commission income
2. Costs and expenses 52,314,397,544.31 56,684,201,307.20
Including: Cost of sales 47,595,064,349.98 52,138,198,501.04
Interest expense
Handling charge and commission expense
Surrenders
Net insurance claims paid
Net amount provided as insurance contract
reserve
Expenditure on policy dividends
Reinsurance premium expense
Taxes and surcharges 97,235,867.31 109,851,831.11
Selling expense 1,825,626,804.27 2,303,132,732.06
Administrative expense 1,022,981,943.34 856,529,327.62
144
Konka Group Co., Ltd. Annual Report 2020
R&D expense 681,878,611.65 500,600,102.23
Finance costs 1,091,609,967.76 775,888,813.14
Including: Interest expense 979,223,522.98 1,031,068,425.69
Interest income 164,580,939.30 247,559,600.76
Add: Other income 928,933,528.03 1,229,174,834.33
Return on investment (“-” for loss) 2,433,336,004.85 1,183,381,090.39
Including: Share of profit or loss of joint ventures
106,458,465.42 141,264,035.96
and associates
Income from the derecognition of financial assets
at amortized cost (“-” for loss)
Exchange gain (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 19,089,541.66 -3,005,381.67
Credit impairment loss (“-” for loss) -722,375,850.15 -531,879,268.76
Asset impairment loss (“-” for loss) -462,407,098.47 -303,035,915.82
Asset disposal income (“-” for loss) 206,315,700.34 293,706,640.64
3. Operating profit (“-” for loss) 440,330,836.82 303,266,170.63
Add: Non-operating income 87,126,795.41 165,843,388.94
Less: Non-operating expense 25,590,474.86 18,533,352.41
4. Profit before tax (“-” for loss) 501,867,157.37 450,576,207.16
Less: Income tax expense -38,206,305.07 115,640,091.82
5. Net profit (“-” for net loss) 540,073,462.44 334,936,115.34
5.1 By operating continuity 540,073,462.44 334,936,115.34
5.1.1 Net profit from continuing operations (“-” for net
540,073,462.44 334,936,115.34
loss)
5.1.2 Net profit from discontinued operations (“-” for
net loss)
5.2 By ownership 540,073,462.44 334,936,115.34
5.2.1 Net profit attributable to shareholders of the
477,633,250.14 212,034,210.08
Company as the parent
5.2.1 Net profit attributable to non-controlling interests 62,440,212.30 122,901,905.26
6. Other comprehensive income, net of tax -2,800,360.64 -9,001,934.47
Attributable to owners of the Company as the parent 3,081,866.10 -10,754,884.44
6.1 Items that will not be reclassified to profit or loss 1,625,107.80 -9,652,181.00
6.1.1 Changes caused by remeasurements on defined
benefit schemes
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Konka Group Co., Ltd. Annual Report 2020
6.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
6.1.3 Changes in the fair value of investments in
1,625,107.80
other equity instruments
6.1.4 Changes in the fair value arising from changes
-9,652,181.00
in own credit risk
6.1.5 Other
6.2 Items that will be reclassified to profit or loss 1,456,758.30 -1,102,703.44
6.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
6.2.2 Changes in the fair value of investments in
other debt obligations
6.2.3 Other comprehensive income arising from the
reclassification of financial assets
6.2.4 Credit impairment allowance for investments in
other debt obligations
6.2.5 Reserve for cash flow hedges
6.2.6 Differences arising from the translation of
1,456,758.30 -1,102,703.44
foreign currency-denominated financial statements
6.2.7 Other
Attributable to non-controlling interests -5,882,226.74 1,752,949.97
7. Total comprehensive income 537,273,101.80 325,934,180.87
Attributable to owners of the Company as the parent 480,715,116.24 201,279,325.64
Attributable to non-controlling interests 56,557,985.56 124,654,855.23
8. Earnings per share
8.1 Basic earnings per share 0.1984 0.0881
8.2 Diluted earnings per share 0.1984 0.0881
Legal representative: Liu Fengxi CFO: Li Chunlei
Head of the financial department: Guo Zhihua
4. Income Statement of the Company as the Parent
Unit: RMB
Item 2020 2019
1. Operating revenue 3,714,887,652.49 5,686,102,146.98
Less: Cost of sales 3,276,220,339.62 5,413,631,784.77
Taxes and surcharges 10,739,550.81 14,547,750.43
Selling expense 503,144,683.54 1,210,476,107.74
Administrative expense 472,549,413.24 387,778,068.98
R&D expense 93,029,766.19 47,127,013.11
146
Konka Group Co., Ltd. Annual Report 2020
Finance costs 626,375,762.29 414,932,824.70
Including: Interest expense 813,956,736.75 1,553,039,361.28
Interest income 438,850,221.34 782,721,658.41
Add: Other income 66,280,682.30 51,226,732.61
Return on investment (“-” for loss) 1,821,844,767.52 999,198,310.44
Including: Share of profit or loss of joint ventures
-5,700,659.97 5,132,712.27
and associates
Income from the derecognition of financial assets
at amortized cost (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 9,337,458.33 -3,005,381.67
Credit impairment loss (“-” for loss) -631,160,001.21 -170,077,622.68
Asset impairment loss (“-” for loss) -100,464,731.32 -16,347,540.36
Asset disposal income (“-” for loss) 188,200,000.00 1,000.00
2. Operating profit (“-” for loss) 86,866,312.42 -941,395,904.41
Add: Non-operating income 35,988,778.37 19,741,857.31
Less: Non-operating expense 9,642,635.24 3,088,072.47
3. Profit before tax (“-” for loss) 113,212,455.55 -924,742,119.57
Less: Income tax expense -94,328,961.05 -365,219,888.18
4. Net profit (“-” for net loss) 207,541,416.60 -559,522,231.39
4.1 Net profit from continuing operations (“-” for net loss) 207,541,416.60 -559,522,231.39
4.2 Net profit from discontinued operations (“-” for net
loss)
5. Other comprehensive income, net of tax -1,500,000.00
5.1 Items that will not be reclassified to profit or loss -1,500,000.00
5.1.1 Changes caused by remeasurements on defined
benefit schemes
5.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
5.1.3 Changes in the fair value of investments in other
equity instruments
5.1.4 Changes in the fair value arising from changes in
-1,500,000.00
own credit risk
5.1.5 Other
5.2 Items that will be reclassified to profit or loss
5.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
147
Konka Group Co., Ltd. Annual Report 2020
5.2.2 Changes in the fair value of investments in other
debt obligations
5.2.3 Other comprehensive income arising from the
reclassification of financial assets
5.2.4 Credit impairment allowance for investments in
other debt obligations
5.2.5 Reserve for cash flow hedges
5.2.6 Differences arising from the translation of foreign
currency-denominated financial statements
5.2.7 Other
6. Total comprehensive income 207,541,416.60 -561,022,231.39
7. Earnings per share
7.1 Basic earnings per share
7.2 Diluted earnings per share
5. Consolidated Cash Flow Statement
Unit: RMB
Item 2020 2019
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of
47,366,925,545.71 55,023,730,960.29
services
Net increase in customer deposits and interbank deposits
Net increase in borrowings from the central bank
Net increase in loans from other financial institutions
Premiums received on original insurance contracts
Net proceeds from reinsurance
Net increase in deposits and investments of policy holders
Interest, handling charges and commissions received
Net increase in interbank loans obtained
Net increase in proceeds from repurchase transactions
Net proceeds from acting trading of securities
Tax rebates 453,084,150.61 697,787,485.21
Cash generated from other operating activities 4,223,616,786.41 4,011,016,045.28
Subtotal of cash generated from operating activities 52,043,626,482.73 59,732,534,490.78
Payments for commodities and services 45,800,932,391.57 54,686,521,084.34
Net increase in loans and advances to customers
Net increase in deposits in the central bank and in
interbank loans granted
148
Konka Group Co., Ltd. Annual Report 2020
Payments for claims on original insurance contracts
Net increase in interbank loans granted
Interest, handling charges and commissions paid
Policy dividends paid
Cash paid to and for employees 1,744,799,823.16 1,808,972,838.78
Taxes paid 854,326,582.63 842,402,228.64
Cash used in other operating activities 3,464,951,157.16 3,938,585,623.61
Subtotal of cash used in operating activities 51,865,009,954.52 61,276,481,775.37
Net cash generated from/used in operating activities 178,616,528.21 -1,543,947,284.59
2. Cash flows from investing activities:
Proceeds from disinvestment 706,624,869.40 224,405,975.50
Return on investment 125,587,929.51 168,681,375.93
Net proceeds from the disposal of fixed assets, intangible
370,112,371.91 202,577,149.61
assets and other long-lived assets
Net proceeds from the disposal of subsidiaries and other
873,767,298.03 270,821,233.18
business units
Cash generated from other investing activities 2,722,258,145.07 2,085,669,168.69
Subtotal of cash generated from investing activities 4,798,350,613.92 2,952,154,902.91
Payments for the acquisition of fixed assets, intangible
5,639,711,463.90 3,928,377,181.52
assets and other long-lived assets
Payments for investments 254,250,619.25 1,357,746,303.50
Net increase in pledged loans granted
Net payments for the acquisition of subsidiaries and other
business units
Cash used in other investing activities 1,356,937,320.83 1,528,640,757.47
Subtotal of cash used in investing activities 7,250,899,403.98 7,250,899,403.98
Net cash generated from/used in investing activities -2,452,548,790.06 -3,862,609,339.58
3. Cash flows from financing activities:
Capital contributions received 505,578,067.25 508,363,013.03
Including: Capital contributions by non-controlling
505,578,067.25 508,363,013.03
interests to subsidiaries
Borrowings raised 19,606,041,084.27 30,069,405,522.31
Cash generated from other financing activities 2,755,219,144.42 1,825,598,732.14
Subtotal of cash generated from financing activities 22,866,838,295.94 32,403,367,267.48
Repayment of borrowings 17,891,643,322.79 23,540,444,424.43
Interest and dividends paid 865,497,236.05 774,763,008.11
149
Konka Group Co., Ltd. Annual Report 2020
Including: Dividends paid by subsidiaries to
4,513,500.00 32,480,813.33
non-controlling interests
Cash used in other financing activities 1,974,684,683.67 1,623,142,762.86
Subtotal of cash used in financing activities 20,731,825,242.51 25,938,350,195.40
Net cash generated from/used in financing activities 2,135,013,053.43 6,465,017,072.08
4. Effect of foreign exchange rates changes on cash and cash
-56,726,595.56 1,091,987.59
equivalents
5. Net increase in cash and cash equivalents -195,645,803.98 1,059,552,435.50
Add: Cash and cash equivalents, beginning of the period 4,493,701,917.22 3,434,149,481.72
6. Cash and cash equivalents, end of the period 4,298,056,113.24 4,493,701,917.22
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item 2020 2019
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of
3,449,433,124.12 8,005,144,873.81
services
Tax rebates 264,186,752.60 66,111,058.65
Cash generated from other operating activities 2,775,286,767.61 14,543,919,908.50
Subtotal of cash generated from operating activities 6,488,906,644.33 22,615,175,840.96
Payments for commodities and services 4,041,185,808.91 7,375,766,734.52
Cash paid to and for employees 339,065,929.50 695,358,748.25
Taxes paid 21,261,070.79 49,371,867.49
Cash used in other operating activities 2,786,729,899.09 17,421,013,450.10
Subtotal of cash used in operating activities 7,188,242,708.29 25,541,510,800.36
Net cash generated from/used in operating activities -699,336,063.96 -2,926,334,959.40
2. Cash flows from investing activities:
Proceeds from disinvestment 1,504,019,339.15 352,345,126.34
Return on investment 228,657,238.16 154,536,752.58
Net proceeds from the disposal of fixed assets, intangible
188,356,456.56 1,248,287.86
assets and other long-lived assets
Net proceeds from the disposal of subsidiaries and other
business units
Cash generated from other investing activities 9,733,428,063.02 1,280,395,551.82
Subtotal of cash generated from investing activities 11,654,461,096.89 1,788,525,718.60
Payments for the acquisition of fixed assets, intangible
112,518,905.62 90,251,903.78
assets and other long-lived assets
Payments for investments 1,400,141,815.71 1,628,545,610.00
150
Konka Group Co., Ltd. Annual Report 2020
Net payments for the acquisition of subsidiaries and other
business units
Cash used in other investing activities 8,258,345,751.11 1,021,817,610.69
Subtotal of cash used in investing activities 9,771,006,472.44 2,740,615,124.47
Net cash generated from/used in investing activities 1,883,454,624.45 -952,089,405.87
3. Cash flows from financing activities:
Capital contributions received
Borrowings raised 14,529,825,025.55 25,760,260,136.81
Cash generated from other financing activities 9,797,462,437.60 30,700,000.00
Subtotal of cash generated from financing activities 24,327,287,463.15 25,790,960,136.81
Repayment of borrowings 15,109,478,610.76 21,231,768,458.85
Interest and dividends paid 741,959,265.05 649,307,167.98
Cash used in other financing activities 8,075,141,705.43 177,215,911.37
Subtotal of cash used in financing activities 23,926,579,581.24 22,058,291,538.20
Net cash generated from/used in financing activities 400,707,881.91 3,732,668,598.61
4. Effect of foreign exchange rates changes on cash and cash
-11,406,036.33 -14,696,602.27
equivalents
5. Net increase in cash and cash equivalents 1,573,420,406.07 -160,452,368.93
Add: Cash and cash equivalents, beginning of the period 1,337,342,186.92 1,497,794,555.85
6. Cash and cash equivalents, end of the period 2,910,762,592.99 1,337,342,186.92
151
Konka Group Co., Ltd. Annual Report 2020
7. Consolidated Statements of Changes in Owners’ Equity
2020
Unit: RMB
2020
Equity attributable to owners of the Company as the parent
Other equity instruments O
Item Less: Spe Gener
Other t Non-controllin Total owners’
Preferr Perpetu Capital Treasu cific Surplus al Retained
Share capital comprehensi h Subtotal g interests equity
Othe
ed al reserves ry rese reserves reserv earnings
r ve income e
shares bonds stock rve e
r
1. Balance as at the end of the prior 2,407,945,408. 230,368,577. 1,211,721,109. 4,239,763,606. 8,068,505,598. 1,858,192,188.
-21,293,103. 9,926,697,786.
year 00 09 67 89 13 67
52 80
Add: Adjustment for change in
accounting policy
Adjustment for correction of
previous error
Adjustment for business
combination under common control
Other adjustments
2. Balance as at the beginning of the 2,407,945,408. 230,368,577. 1,211,721,109. 4,239,763,606. 8,068,505,598. 1,858,192,188.
-21,293,103. 9,926,697,786.
year 00 09 67 89 13 67
52 80
3. Increase/ decrease in the period (“-”
-183,267.00 355,607,784.7 360,134,578.8 434,062,759.0
for decrease) 4,710,061.10 794,197,337.84
4 4 0
3.1 Total comprehensive income
152
Konka Group Co., Ltd. Annual Report 2020
3,081,866.10 477,633,250.1 480,715,116.2 56,557,985.56 537,273,101.80
4 4
3.2 Capital increased and reduced
-183,267.00 -183,267.00 418,501,067.2
by owners 418,317,800.25
5
3.2.1 Ordinary shares increased
418,501,067.2
by owners 418,501,067.25
5
3.2.2 Capital increased by
holders of other equity instruments
3.2.3 Share-based payments
included in owners’ equity
3.2.4 Other -183,267.00 -183,267.00 -183,267.00
3.3 Profit distribution -120,397,270.4 -120,397,270.4 -161,393,564.2
-40,996,293.81
0 0 1
3.3.1 Appropriation to surplus
reserves
3.3.2 Appropriation to general
reserve
3.3.3 Appropriation to owners (or
-120,397,270.4 -120,397,270.4 -161,393,564.2
shareholders) -40,996,293.81
0 0 1
3.3.4 Other
3.4 Transfers within owners’ equity -1,628,195.00
1,628,195.00
3.4.1 Increase in capital (or share
capital) from capital reserves
153
Konka Group Co., Ltd. Annual Report 2020
3.4.2 Increase in capital (or share
capital) from surplus reserves
3.4.3 Loss offset by surplus
reserves
3.4.4 Changes in defined benefit
schemes transferred to retained
earnings
3.4.5 Other comprehensive
income transferred to retained
earnings
3.4.6 Other -1,628,195.00
1,628,195.00
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other
2,407,945,408. 230,185,310. 1,211,721,109. 4,595,371,391. 8,428,640,176. 2,292,254,947. 10,720,895,124
4. Balance as at the end of the period -16,583,042.
00 09 67 63 97 67 .64
42
2019
Unit: RMB
2019
Equity attributable to owners of the Company as the parent
Item Other equity instruments Less: Spe Gener O
Other Non-controllin Total owners’
Preferr Perpetu Capital Treasu cific Surplus al Retained t
Share capital comprehensi Subtotal g interests equity
Othe
ed al reserves ry rese reserves reserv earnings h
r ve income
shares bonds stock rve e e
154
Konka Group Co., Ltd. Annual Report 2020
r
1. Balance as at the end of the prior -10,538,219. 1,227,564,785. 4,271,408,192. 8,104,736,790. 1,346,631,520.
2,407,945,408.0 208,356,624. 9,451,368,310.
year 08 19 21 53 26
0 21 79
Add: Adjustment for change in
-2,884,254.62 -2,884,254.62
accounting policy -2,884,254.62
Adjustment for correction of
previous error
Adjustment for business
combination under common control
Other adjustments
2. Balance as at the beginning of the
2,407,945,408.0 208,356,624. -10,538,219. 1,227,564,785. 4,268,523,937. 8,101,852,535. 1,346,631,520. 9,448,484,056.
year
0 21 08 19 59 91 26 17
3. Increase/ decrease in the period
22,011,952.8 -10,754,884. -33,346,937.7 511,560,668.4
(“-” for decrease) -15,843,675.52 -28,760,330.70 478,213,730.63
8 44 8 1
-10,754,884.
3.1 Total comprehensive income 201,279,325.6 124,654,855.2
44 212,034,210.08 325,934,180.87
4 3
3.2 Capital increased and reduced
-7,393,378.5 -23,237,054.0 420,402,243.2
by owners -15,843,675.52 397,165,189.16
5 7 3
3.2.1 Ordinary shares increased
437,269,412.0
by owners 437,269,412.06
6
3.2.2 Capital increased by
155
Konka Group Co., Ltd. Annual Report 2020
holders of other equity instruments
3.2.3 Share-based payments
included in owners’ equity
3.2.4 Other -7,393,378.5 -23,237,054.0
-15,843,675.52 -16,867,168.83 -40,104,222.90
5 7
3.3 Profit distribution -240,794,540.7 -240,794,540. -285,899,825.4
-45,105,284.66
8 78 4
3.3.1 Appropriation to surplus
reserves
3.3.2 Appropriation to general
reserve
3.3.3 Appropriation to owners
-240,794,540.7 -240,794,540. -274,290,970.8
(or shareholders) -33,496,430.05
8 78 3
3.3.4 Other
-11,608,854.61 -11,608,854.61
3.4 Transfers within owners’
11,608,854.61
equity 11,608,854.61
3.4.1 Increase in capital (or
share capital) from capital reserves
3.4.2 Increase in capital (or
share capital) from surplus reserves
3.4.3 Loss offset by surplus
reserves
3.4.4 Changes in defined benefit
schemes transferred to retained
156
Konka Group Co., Ltd. Annual Report 2020
earnings
3.4.5 Other comprehensive
income transferred to retained
earnings
3.4.6 Other 11,608,854.61
11,608,854.61
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other 29,405,331.4 29,405,331.43
29,405,331.43
3
-21,293,103. 1,211,721,109. 4,239,763,606. 8,068,505,598. 1,858,192,188.
4. Balance as at the end of the period 2,407,945,408.0 230,368,577. 9,926,697,786.
52 67 89 13 67
0 09 80
8. Statements of Changes in Owners’ Equity of the Company as the Parent
2020
Unit: RMB
2020
Other equity instruments
Less:
Item Other comprehensive Specific Total owners’
Perpetu
Share capital Preferre Capital reserves Treasury Surplus reserves Retained earnings Other
al Other income reserve equity
d shares stock
bonds
1. Balance as at the end of the prior year 2,407,945,408.00 -2,682,217.31
114,018,066.79 1,227,564,785.19 2,245,698,875.22 5,992,544,917.89
Add: Adjustment for change in accounting
policy
157
Konka Group Co., Ltd. Annual Report 2020
Adjustment for correction of previous
error
Other adjustments 19,541,983.67 19,541,983.67
2. Balance as at the beginning of the year 2,407,945,408.00 -2,682,217.31
114,018,066.79 1,227,564,785.19 2,265,240,858.89 6,012,086,901.56
3. Increase/ decrease in the period (“-” for
-1,447,714.07 87,144,146.20 85,696,432.13
decrease)
3.1 Total comprehensive income 207,541,416.60 207,541,416.60
3.2 Capital increased and reduced by
-1,264,447.07 -1,264,447.07
owners
3.2.1 Ordinary shares increased by
owners
3.2.2 Capital increased by holders of
other equity instruments
3.2.3 Share-based payments included
in owners’ equity
3.2.4 Other -1,264,447.07 -1,264,447.07
3.3 Profit distribution -120,397,270.40 -120,397,270.40
3.3.1 Appropriation to surplus
reserves
3.3.2 Appropriation to owners (or
-120,397,270.40 -120,397,270.40
shareholders)
3.3.3 Other
3.4 Transfers within owners’ equity
3.4.1 Increase in capital (or share
capital) from capital reserves
3.4.2 Increase in capital (or share
capital) from surplus reserves
158
Konka Group Co., Ltd. Annual Report 2020
3.4.3 Loss offset by surplus reserves
3.4.4 Changes in defined benefit
schemes transferred to retained earnings
3.4.5 Other comprehensive income
transferred to retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other -183,267.00 -183,267.00
4. Balance as at the end of the period 2,407,945,408.00 -2,682,217.31
112,570,352.72 1,227,564,785.19 2,352,385,005.09 6,097,783,333.69
2019
Unit: RMB
2019
Other equity instruments
Less:
Item Other comprehensive Specific Total owners’
Perpetu
Share capital Preferre Capital reserves Treasury Surplus reserves Retained earnings Other
al Other income reserve equity
d shares stock
bonds
1. Balance as at the end of the prior year 2,407,945,408.00 -1,182,217.31 1,227,564,785.19 3,040,171,940.85 6,788,517,983.52
114,018,066.79
Add: Adjustment for change in
-2,127,505.16 -2,127,505.16
accounting policy
Adjustment for correction of previous
error
Other adjustments 7,971,211.72 7,971,211.72
159
Konka Group Co., Ltd. Annual Report 2020
2. Balance as at the beginning of the year 2,407,945,408.00 -1,182,217.31 1,227,564,785.19 3,046,015,647.41 6,794,361,690.08
114,018,066.79
3. Increase/ decrease in the period (“-” for
-1,500,000.00 -800,316,772.19 -801,816,772.19
decrease)
3.1 Total comprehensive income -1,500,000.00 -559,522,231.39 -561,022,231.39
3.2 Capital increased and reduced by
owners
3.2.1 Ordinary shares increased by
owners
3.2.2 Capital increased by holders of
other equity instruments
3.2.3 Share-based payments included
in owners’ equity
3.2.4 Other
3.3 Profit distribution -240,794,540.80 -240,794,540.80
3.3.1 Appropriation to surplus
reserves
3.3.2 Appropriation to owners (or
-240,794,540.80 -240,794,540.80
shareholders)
3.3.3 Other
3.4 Transfers within owners’ equity
3.4.1 Increase in capital (or share
capital) from capital reserves
3.4.2 Increase in capital (or share
capital) from surplus reserves
3.4.3 Loss offset by surplus reserves
3.4.4 Changes in defined benefit
schemes transferred to retained earnings
160
Konka Group Co., Ltd. Annual Report 2020
3.4.5 Other comprehensive income
transferred to retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other
4. Balance as at the end of the period 2,407,945,408.00 -2,682,217.31 1,227,564,785.19 2,245,698,875.22 5,992,544,917.89
114,018,066.79
161
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
I. 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 29 August 1995, the
Company was renamed to “Konka Group Co., Ltd.” (Credibility code: 914403006188155783)
with its main business electronic industry. And now the headquarters locates in No. 28 of No. 12
of Keji South Rd., Science & Technology Park, Yuehai Street, Nanshan District, Shenzhen,
Guangdong Province.
2. Share capital
After the distribution of bonus shares, allotments, increased share capital and new shares issued
over the years, as of 31 December 2020, the Company has issued a total of 2,407,945,408.00
shares (denomination of RMB1 per share) with a registered capital of RMB2,407,945,408.00.
3. The nature of the company's business and main operating activities
The Company and its subsidiaries are mainly engaged in the production and sales of colour TVs,
white goods, etc.; Industry trade business, environmental protection, semi-conductor, etc.
4. The financial statements contained herein have been approved for issue by the Board of
Directors of the Company on 22 March 2021.
II. Consolidation scope
1. The Company has a total of 143 subsidiaries included in the consolidation scope including
Electronics Technology, Anhui Konka, Dongguan Konka. The consolidation scope of the
Company this year increased by 30 households including Yibin Kangrun due to incorporation or
external purchase and decreased by 33 households including Dongguan Konka Investment due to
losing control or cancellation compared to the previous year.
For details, please refer to Note 7 “Changes in the consolidation scope” and Note 8 "Equity in
Other Entities".
2. A check list of corporate names and their abbreviations mentioned in this Report
No. Corporate name Abbreviation
1 Konka Ventures Development (Shenzhen) Co., Ltd. Konka Ventures
2 Yantai Konka Healthcare Enterprise Service Co., Ltd. Yantai Konka
Chengdu Anren Konka Cultural and Creative Incubator Management
3 Chengdu Anren
Co., Ltd.
4 Guiyang Konka Enterprise Service Co., Ltd. Konka Enterprise Service
5 Nanjing Chuanghui Smart Technology Co., Ltd. Chuanghui Smart
6 Yibin Konka Incubator Management Co., Ltd. Yibin Konka Incubator
7 Anhui Konka Electronic Co., Ltd. Anhui Konka
8 Anhui Kangzhi Trade Co., Ltd. Kangzhi Trade
9 Konka Factoring (Shenzhen) Co., Ltd. Konka Factoring
10 Shenzhen Konka Unifortune Technology Co., Ltd. Konka Unifortune
162
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
11 Jiali International (Hong Kong) Limited Jiali International
12 Shenzhen Wankaida Science and Technology Co., Ltd. Wankaida
13 Dongguan Konka Electronic Co., Ltd. Dongguan Konka
14 Suining Konka Smart Technology Co., Ltd. Suining Konka Smart
15 Konka (Europe) Co., Ltd. Konka Europe
16 Shenzhen Konka Electrical Appliances Co., Ltd. Konka Electrical Appliances
17 Shenzhen Konka Telecommunications Technology Co., Ltd. Telecommunication Technology
18 Konka Mobility Co., Limited Konka Mobility
19 Shenzhen Konka Mobile Interconnection Technology Co., Ltd. Mobile Interconnection
20 Sichuan Konka Smart Terminal Technology Co., Ltd Sichuan Konka
21 Yibin Konka Smart Technology Co., Ltd. Yibin Smart
22 Anhui Konka Tongchuang Electrical Appliances Co., Ltd. Anhui Tongchuang
23 Anhui Konka Electrical Appliance Technology Co., Ltd. Anhui Electrical Appliance
24 Henan Frestec Refrigeration Appliance Co., Ltd. Frestec Refrigeration
25 Henan Frestec Smart Home Technology Co., Ltd. Frestec Smart Home
26 Henan Frestec Electrical Appliances Co., Ltd. Frestec Electrical Appliances
27 Henan Frestec Household Appliances Co., Ltd. Frestec Household Appliances
28 Jiangsu Konka Smart Electrical Appliances Co., Ltd. Jiangsu Konka Smart
29 Sichuan Kangjiatong Technology Co., Ltd. Kangjiatong
30 Shenzhen Konka Pengrun Technology & Industry Co., Ltd. Pengrun Technology
31 Jiaxin Technology Co., Ltd. Jiaxin Technology
32 Dongguan Konka Packing Materials Co., Ltd. Dongguan Packing
33 Shenzhen E2info Network Technology Co., Ltd. E2info
34 E2info (Hainan) Network Technology Co., Ltd. E2info (Hainan)
35 Beijing Konka Electronic Co., Ltd. Beijing Konka Electronic
36 Konka Financial Leasing (Tianjin) Co., Ltd. Konka Leasing
37 Shenzhen Kangjia circuit Co., Ltd. Konka Circuit
38 Boluo Konka Precision Technology Co., Ltd. Boluo Konka Precision
39 Xiamen Dalong Trading Co., Ltd. Xiamen Dalong
40 Boluo Konka PCB Co., Ltd. Boluo Konka
41 Hong Kong Konka Limited Hong Kong Konka
Konka Electrical Appliances
42 Konka Electrical Appliances Investment & Development Co., Ltd.
Investment
Chain Kingdom Memory
43 Chain Kingdom Memory Technologies Co., Limited
Technologies
163
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
Chain Kingdom Memory
44 Chain Kingdom Memory Technologies (Shenzhen) Co., Ltd.
Technologies (Shenzhen)
45 Hefei KONSEMI Storage Technology Co., Ltd. Hefei KONSEMI
46 Konka SmartTech Limited Konka SmartTech
47 Kangjietong (Hong Kong) Limited Kangjietong
Konka Electrical Appliances
48 Konka Electrical Appliances International Trading Co., Ltd.
International Trading
49 Kanghao Technology Co., Ltd. Kanghao Technology
50 Konka North America LLC Konka North America
51 Shenzhen Konka Investment Holding Co., Ltd. Konka Investment
52 Yibin Konka Technology Park Operation Co., Ltd. Yibin Konka Technology Park
53 Shenzhen Konka Capital Equity Investment Management Co., Ltd. Konka Capital
54 Konka Suiyong Investment (Shenzhen) Co., Ltd. Konka Suiyong
55 Shenzhen Kangquan Enterprise Management Consulting Co., Ltd. Kangquan Enterprise
56 Shenzhen Konka Suyuan Investment Industrial Co., Ltd. Konka Suyuan
57 Shenzhen Konka Shengxing Industrial Co., Ltd. Shengxing Industrial
58 Shenzhen Konka Industrial Park Development Co., Ltd. Industrial Park Development
59 Shenzhen Konka Zhitong Technology Co., Ltd. Zhitong Technology
60 Shenzhen Konka Electronics Technology Co., Ltd. Electronics Technology
61 Anhui Konka Zhilian E-Commerce Co., Ltd. Anhui Zhilian
62 Shenzhen Youzhihui Technology Co., Ltd. Youzhihui
63 Shenzhen Xiaojia Technology Co., Ltd. Xiaojia Technology
64 Haimen Konka Smart Technology Co., Ltd. Haimen Konka
65 Chengdu Konka Smart Technology Co., Ltd. Chengdu Konka Smart
66 Chengdu Konka Electronic Co., Ltd. Chengdu Konka Electronic
67 GuangDong XingDa HongYe Electronic Co., Ltd. XingDa HongYe
68 Shanghai Xinfeng Zhuoqun PCB Co., Ltd. Shanghai Xinfeng
69 Liaoyang Kangshun Smart Technology Co., Ltd. Liaoyang Kangshun Smart
70 Liaoyang Kangshun Renewable Energy Co., Ltd. Liaoyang Kangshun Renewable
71 Nanjing Konka Electronics Co., Ltd. Nanjing Konka
72 Yantai Laikang Industrial Development Co., Ltd. Yantai Laikang
73 Shandong Econ Technology Co., Ltd. Econ Technology
74 Beijing Econ Runfeng Technology Co., Ltd. Beijing Econ
75 Shanghai Jiyi Environmental Technology Co., Ltd. Shanghai Jiyi
76 Binzhou Econ Zhongke Environmental Technology Co., Ltd. Binzhou Econ Zhongke
164
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
77 Laizhou Lairun Holding Co., Ltd. Lairun Holding
78 Laizhou Lairun Environmental Protection Co., Ltd. Lairun Environmental Protection
79 Laizhou Lairun Wastewater Treatment Co., Ltd. Lairun Wastewater
80 Laizhou Binhai Wastewater Treatment Co., Ltd. Binhai Wastewater
81 Econ Environmental Engineering Co., Ltd. Econ Environmental Engineering
82 Rushan Econ Water Environment Management Co., Ltd. Rushan Econ
83 Binzhou Weiyijie Environmental Technology Co., Ltd. Binzhou Weiyijie
84 Binzhou Beihai Jingmai Industrial Development Co., Ltd. Binzhou Beihai Jingmai
85 Yantai Chunzhiran Environmental Technology Co., Ltd. Chunzhiran
86 Donggang Kangrun Environmental Management Co., Ltd. Donggang Kangrun
87 Kangrunhong Environmental Technology (Yantai) Co., Ltd. Kangrunhong Environmental
88 Dayi Kangrun Water Co., Ltd. Dayi Kangrun Water
89 Suining Pengxi Kangrun Environmental Management Co., Ltd. Suining Pengxi Kangrun
90 Subei Mongol Autonomous County Kangrun Water Co., Ltd. Subei Kangrun Water
91 Weifang Sihai Kangrun Investment Operation Co., Ltd. Weifang Sihai Kangrun
92 Lushan Kangrun Environmental Management Co., Ltd. Lushan Kangrun Environmental
93 Funan Kangrun Water Co., Ltd. Funan Kangrun Water
94 Wuhan Runyuan Wastewater Treatment Co., Ltd. Wuhan Runyuan Wastewater
95 Tongchuan Kangrun Honghui Environmental Management Co., Ltd. Tongchuan Kangrun Honghui
96 Tingyuan Environmental Technology (Shanghai) Co., Ltd. Tingyuan Environmental
97 Gaoping Kangrun Environmental Protection & Water Co., Ltd. Gaoping Kangrun
98 Mengcheng Kangrun Anjian Water Co., Ltd. Mengcheng Kangrun
99 Xixian Kangrun Xijian Water Environment Development Co., Ltd. Xixian Kangrun
100 Chongzhou Kangrun Environment Co., Ltd. Chongzhou Kangrun
101 Xi’an Gaoling Kangrun Environmental Engineering Co., Ltd. Xi’an Kangrun
102 Ankang Kangrun Xinheng Water Environment Co., Ltd. Ankang Kangrun
103 Changning Kangrun Water Co., Ltd. Changning Kangrun
104 Bokang Renewable Resources (Yantai) Co., Ltd. Bokang Renewable
105 Linfen Kangrun Jinze Water Supply Co., Ltd. Linfen Kangrun
106 Konka Huanjia (Dalian) Environmental Technology Co., Ltd. Konka Huanjia
107 Konka Huanjia (Henan) Environmental Technology Co., Ltd. Konka Huanjia (Henan)
108 Shanghai Konka Industrial Co., Ltd. Shanghai Konka
109 Yantai Kangjin Technology Development Co., Ltd. Yantai Kangjin
110 Jiangxi Konka New Material Technology Co., Ltd. Jiangxi Konka
111 Jiangxi Xinfeng Microcrystalline Jade Co., Ltd. Xinfeng Microcrystalline
165
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
112 Jiangxi Golden Phoenix Nano Crystallized Glass Co., Ltd. Nano Crystallized Glass
113 Jiangsu Konka Special Material Technology Co., Ltd. Jiangsu Konka Special Material
114 Shenzhen Nianhua Enterprise Management Co., Ltd. Shenzhen Nianhua
115 Shenzhen KONSEMI Co., Ltd. Shenzhen KONSEMI
116 Hefei KONSEMI Storage Technology Co., Ltd. Hefei KONSEMI
117 Hefei Yihe Electronic Co., Ltd. Yihe Electronic
118 Chongqing Konka Technology Development Co., Ltd. Chongqing Konka
119 Shenzhen Konka Huiying Technology Co., Ltd. Shenzhen Huiying Technology
120 Chongqing Konka Huiying Technology Co., Ltd. Chongqing Huiying Technology
121 Shenzhen Konka Eco-Development Investment Co., Ltd. Konka Eco-Development
122 Suining Konka Industrial Park Development Co., Ltd. Suining Konka Industrial Park
123 Konka Ronghe Industrial Technology (Zhejiang) Co., Ltd. Konka Ronghe
Suining Electronic Technological
124 Suining Konka Electronic Technological Innovation Co., Ltd.
Innovation
Shenzhen Chuangzhi Electrical
125 Shenzhen Konka Chuangzhi Electrical Appliances Co., Ltd.
Appliances
126 Kanghong (Yantai) Environmental Technology Co., Ltd. Kanghong (Yantai) Environmental
127 Chongqing Kangxingrui Environmental Technology Co., Ltd. Chongqing Kangxingrui
Chongqing Kangxingrui Scraped Automobile Recycling Co., Ltd. Chongqing Kangxingrui
128
Automobile Recycling
Chongqing Konka Optoelectronic Technology Research Institute Co.,Chongqing Optoelectronic
129
Ltd. Technology Research Institute
130 Konka Xinying Semiconductor Technology (Shenzhen) Co., Ltd. Xinying Semiconductor
131 Konka Xinyun Semiconductor Technology (Yancheng) Co., Ltd. Konka Xinyun Semiconductor
132 Jiangkang (Shanghai) Technology Co., Ltd. Jiangkang (Shanghai) Technology
Ningbo Kanghanrui Electrical
133 Ningbo Kanghanrui Electrical Appliances Co., Ltd.
Appliances
134 Shenzhen Konka Intelligent Manufacturing Technology Co., Ltd. Konka Intelligent Manufacturing
135 Suining Jiarun Property Co., Ltd. Suining Jiarun Property
136 Yantai Kangyun Industrial Development Co., Ltd. Yantai Kangyun
137 Yantai Kangyun Property Development Co., Ltd. Yantai Kangyun Property
138 Chongqing Kanglei Optoelectronic Technology Co., Ltd. Chongqing Kanglei Optoelectronic
139 Yibin Kangrun Environmental Technology Co., Ltd. Yibin Kangrun
140 Henan Kangxin Property Co., Ltd. Henan Kangxin Property
141 Hainan Konka Material Technology Co., Ltd. Konka Material
142 Shenzhen Kangxin Property Co., Ltd. Shenzhen Kangxin Property
166
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
143 Henan Kanghan Property Co., Ltd. Henan Kanghan Property
144 Chengdu Konka Incubator Management Co., Ltd. Chengdu Konka Incubator
145 Shenzhen Konka Cross-Border Technological Innovation Service Co., Cross-Border Technological
Ltd. Innovation
146 Guizhou Konka Enterprise Management Service Co., Ltd. Konka Enterprise Management
147 Youshi Kangrong Culture Communication Co., Ltd. Youshi Kangrong
148 Shenzhen Konka Life Electric Appliance Co., Ltd. Life Electric Appliance
149 Shenzhen Konka Commercial System Technology Co., Ltd. Commercial System Technology
150 Henan Frestec Smart Eco Electrical Appliances Co., Ltd. Frestec Smart
151 E3info (Hainan) Technology Co., Ltd. E3info
152 Shenzhen Konka Yifang Technology Co., Ltd. Yifang Technology
153 Yuekang Semiconductor Technology (Yantai) Co., Ltd. Yuekang Semiconductor
154 Kangshi Virtual Technology (Yantai) Co., Ltd. Kangshi Virtual
155 Sichuan Konka Industrial New Town Development Co., Ltd. Industrial New Town
156 Shenzhen Konka Kangxin Technology Co., Ltd. Kangxin Technology
157 Hainan Konka Technology Industry Development Co., Ltd. Hainan Technology
158 Nanjing Konka Smart Technology Co., Ltd. Nanjing Konka
159 Zhongshan Kangxin Electronic Technology Co., Ltd. Zhongshan Kangxin Electronic
160 Zhongshan Kang’ao Electronic Co., Ltd. Zhongshan Kang’ao
161 Boxing Xingkang Environmental Technology Co., Ltd. Boxing Xingkang Environmental
162 Yantai Konka Industrial Co., Ltd. Yantai Konka Industrial
163 Shandong Kangxin Industrial Development Co., Ltd. Shandong Kangxin
164 Shenzhen Morsemi Semiconductor Technology Co., Ltd. Shenzhen Morsemi
165 Chongqing Zhengmao Semiconductor Co., Ltd. Zhengmao Semiconductor
166 Dongguan Konka Investment Co., Ltd. Dongguan Konka Investment
167 Kanghong (Yantai) Environmental
Kanghong (Yantai) Environmental Technology Park Co., Ltd.
Technology Park
168 Chongqing Konka Property
Chongqing Konka Property Development Co., Ltd.
Development
169 Chongqing Konka Xingyi Property Co., Ltd. Chongqing Xingyi Property
170 Chongqing Konka Fuze Property Co., Ltd. Chongqing Fuze Property
171 Anhui Konka Debao New Material Technology Co., Ltd. Debao New Material
172 Chuzhou Kangxin Health Industry Development Co., Ltd. Chuzhou Kangxin Health Industry
173 Kangxinlong Environmental
Hubei Kangxinlong Environmental Protection Co., Ltd.
Protection
174 Chongqing Chengda Property Co., Ltd. Chongqing Chengda
167
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No. Corporate name Abbreviation
175 Chongqing Chunfu Property Co., Ltd. Chongqing Chunfu
176 Chongqing Langheng Property Co., Ltd. Chongqing Langheng
177 Morsemi Semiconductor Technology (Hong Kong) Limited Morsemi Hong Kong
III. Basis for the Preparation of Financial Statements
(1) Basic for the preparation
With the going-concern assumption as the basis and based on transactions and other events that
actually occurred, the Company prepared financial statements in accordance with The Accounting
Standards for Business Enterprises issued by the Ministry of Finance and other regulations as
well as the accounting policies and estimations stipulated in the Note IV “Significant Accounting
Policies and Estimations”.
(2) Going-concern
The Company does not undergo any affair or situation that causes major doubt about the
continuous operation capacity within 12 months from the end of the Reporting Period.
IV. Important Accounting Policies and Estimations
The specific accounting policies and accounting estimates formulated by the company based on
the actual production and operation characteristics include the recognition and measurement of
bad debt provision for receivables, the measurement of issued inventories, the classification of
fixed assets and depreciation methods, amortization of intangible assets, revenue recognition and
measurement, etc.
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company are in compliance with in compliance with the
Accounting Standards for Business Enterprises, which factually and completely present the
Company’s financial positions, business results and cash flows, and other relevant information.
2. Fiscal Period
The Company’s fiscal year starts on January 1 and ends on December 31 of every year according
to the Gregorian calendar.
3. Operating Cycle
An operating cycle for the Company is 12 months, which is also the classification criterion for the
liquidity of its assets and liabilities.
4. Recording Currency
The Company adopted Renminbi as the bookkeeping base currency.
5. Accounting Treatment Methods for Business Combinations under the Same Control or not
under the Same Control
As the combining party, the assets and liabilities obtained by the Company in a business
combination under the same control shall be measured on the basis of their carrying value in the
final controlling party on the combining date. As for the balance between the carrying value of the
168
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
net assets obtained and the carrying value of the consideration paid by it, the capital reserve shall
be adjusted. If the capital reserve is not sufficient to be offset, the retained earnings shall be
adjusted.
The identifiable assets, liabilities and contingent liabilities of the acquiree acquired in the
business combination under different control shall be measured at fair value on the acquisition
date. The merger cost is the sum of the fair value of cash or non-cash assets, liabilities issued or
assumed, equity securities issued, etc. paid by the Company on the purchase date to gain control
over the purchased party and all directly related expenses incurred in the business combination
(The merge cost of business combination realized step by step through multiple transactions is the
sum of every single transaction’s cost). The balance that the combined cost greater than the fair
value share of the identifiable net assets of the purchased party obtained in the combination shall
be recognized as goodwill; When the merger cost is less than the fair value share of the
identifiable net assets of the acquiree acquired in the merger, the fair value of all identifiable
assets, liabilities and contingent liabilities acquired in the merger, and non-cash assets of the
merger consideration or equity securities issued, etc. shall be reviewed first. After review, if the
merger cost is still less than the fair value share of the identifiable net assets of the acquiree
acquired in the merger, the difference shall be included in the non-operating income of the merger
period.
6. Methods for Preparing Consolidated Financial Statements
The scope of consolidation includes the Company and its all subsidiaries.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies
and accounting period of the Group during the preparation of the consolidated financial
statements, where the accounting policies and the accounting periods are inconsistent between the
Group and subsidiaries.
All significant internal transactions, current balances and unrealized profits within the scope of
consolidation shall be offset when preparing the consolidated statement. The shares of the
subsidiary's owner's equity that do not belong to the parent company and the shares of minority
shareholders' equity in current net profit and loss, other comprehensive income and total
comprehensive income shall be respectively listed in the consolidated financial statement
"Minority shareholders' equity, minority shareholders' profit and loss, other comprehensive
income that belongs to minority shareholders and total comprehensive income that belongs to
minority shareholders".
For subsidiaries acquired through merger of enterprises under the same control, their operating
results and cash flows are included in the consolidated financial statements from the beginning of
the current merger period. When preparing the comparative consolidated financial statements, the
relevant items in the financial statements of the previous year shall be adjusted as if the
consolidated reporting entity had existed since the final controlling party began to control it.
The treatment method of supplementary disclosure in consolidated financial statement for the
Reporting Period when the controlling right is acquired, if the equity of the invested organization
under the same control is successively obtained through several transactions and eventually the
enterprise merger is conducted. For example: At the occasion of the equity of the investee under
the same control is acquired step by step through multiple transactions, and finally form the
business combination, when preparing the consolidated statement, it shall be deemed as the
adjustment is made in the current state when the final controlling party starts to control. And
when compiling the comparative report, the assets and liabilities of the merged party shall be
merged into the comparative statement of the consolidated financial statements of the
consolidated Company without any earlier than the time when the Company and the merged party
169
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
are under the control of the ultimate controlling party, and the combined net increased assets shall
be adjusted to the relevant items under owners' equity in the comparative statements. In order to
avoid the re-calculation of the net assets value of the merged party, the long-term equity
investment held by the Company before the merger, the confirmed relevant profit and loss on the
same party with the Company and the merged party on the date of acquisition of the original
equity from the final control date to the merger date, and changes of other comprehensive income
and other net assets shall offset the beginning retained earnings and current profits and losses of
the comparative statement period respectively.
For subsidiaries acquired through business combination under the different control, the operating
results and cash flow shall be included in the consolidated financial statements from the date
when the Company obtains the control right. When preparing the consolidated financial
statements, the financial statements of the subsidiaries shall be adjusted on the basis of the fair
value of the identifiable assets, liabilities and contingent liabilities determined on the acquisition
date.
The treatment method of supplementary disclosure in consolidated financial statement for the
Reporting Period when the controlling right is acquired, if the equity of the invested organization
not under the same control is successively obtained through several transactions and eventually
the enterprise merger is conducted. For example: At the occasion of the equity of the investee
under different control is acquired step by step through multiple transactions and eventually form
the business combination, when preparing the consolidated statement, the equity of the investee
held before the purchase date is re-measured according to the fair value of the equity on the
purchase date, and the difference between the fair value and its book value is included in the
current investment income. The equity of the acquiree held before the relevant purchase date
involves other comprehensive income under the equity method and other changes in owner's
equity other than net profit and loss, other comprehensive income and profit distribution, which
are converted into investment profit and loss in the current period of the purchase date, except for
other comprehensive income arising from the remeasurement of defined benefit plans's net
liabilities or changes in net assets by the investee.
The Company partially disposes of long-term equity investments in subsidiaries without losing
control, when preparing the consolidated financial statements, the difference between the disposal
price and the share of net assets that the subsidiaries have continuously calculated since the date
of purchase or the date of consolidation is corresponding to the disposal of long-term equity
investments. The capital premium or equity premium is adjusted. If the capital reserve is
insufficient to offset, the retained earnings are adjusted.
If the Company loses control over the investee due to the disposal of some equity investments and
other reasons, the remaining equity shall be re-measured at its fair value on the date of loss of
control when preparing the consolidated financial statements. The difference between the sum of
the consideration obtained from the disposal of equity and the fair value of the remaining equity,
minus the share of the net assets of the original subsidiary calculated on the basis of the original
shareholding ratio and continuously calculated from the date of purchase or merger, is included in
the investment profit and loss of the current period when the control right is lost, and goodwill is
offset. Other comprehensive income related to the original subsidiary's equity investment, etc.,
will be transferred to the current investment profit and loss when the control right is lost.
170
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
If the Company disposes of the equity investment in a subsidiary company step by step through
multiple transactions until the loss of control right, if the transactions of the disposal of the equity
investment in a subsidiary company until the loss of control right belong to a package transaction,
the transactions shall be treated as transactions of the disposal of the subsidiary company and the
loss of control right for accounting. However, the difference between the disposal price and the
share of the subsidiary's net assets corresponding to the disposal investment before the loss of
control right is recognized as other comprehensive income in the consolidated financial
statements, and is transferred to the investment profit and loss of the current period when the
control right is lost.
7. Classification of Joint Arrangements and Accounting Treatment of Joint Operations
The Company classifies joint arrangements into joint operations and joint ventures. For a joint
operation, the Company, as a joint operator, recognizes the assets and liabilities that it holds and
bears in the joint operation, and recognizes the jointly-held assets and jointly-borne liabilities
according to the Company’s stake in the joint operation; recognizes relevant income and expense
according to the Company’s stake in the joint operation. When the Company purchases or sells
the assets not constituting business with the joint operation, the Company only recognized the
share of the other joint operators in the gains and losses arising from the transaction.
8. Cash and Cash Equivalents
In the Company’s understanding, the cash in the cash flow statement includes cash on hand and
deposits that can be used for cover, the cash equivalents in the cash flow statement include high
circulating investments held within three months which are easily convertible into known amount
of cash and whose risks in change of value are minimal.
9. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements
(1) Foreign currency transaction
As for foreign currency transaction, the Company converted the foreign currency amount into
RMB amount at the exchange rate at the beginning of the month of transaction occurrence date
(normally referred to as the central parity rate of foreign exchange rate on the same day published
by the People’s Bank of China, the same below). On the balance sheet date, the monetary items in
foreign currency were converted into RMB at the spot exchange rate on balance sheet date.
Except the exchange difference arising from special foreign-currency borrowing for the purpose
of construction or production of assets meeting capitalization conditions treated in the principle of
capitalization, the conversion difference was directly included in the current profits and losses.
(2) Translation of foreign currency financial statement
The asset and liability items in foreign currency balance sheet were converted at the spot
exchange rate on balance sheet date; except for “undistributed profit”, owner’s equity items were
converted at the sport exchange rate at the time of business occurrence; income and expenditure
items in income statement were converted at the average exchange rate for the period (monthly
average exchange rate) of the transaction occurrence date. The conversion difference of foreign
currency statements arising from the aforementioned conversion was presented in other
comprehensive income item. The foreign currency cash flow was converted at the average
exchange rate for the period (monthly average exchange rate) of the cash flow occurrence date.
The amount of exchange rate change influence on cash was independently presented in cash flow
statement.
171
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
10. Financial Assets and Financial Liabilities
The Company recognizes a financial asset or liability when it becomes a party of the relevant
financial instrument contract.
(1) Financial assets
1) Classification, recognition and measurement of financial assets
The Company classifies the financial assets into financial assets measured at amortized cost,
financial assets measured by the fair value and the changes recorded in other comprehensive
income and financial assets at fair value through profit or loss based on the business model for
financial assets management and characteristics of contractual cash flow of financial assets
The Company classified the financial assets meeting the following conditions at the same time as
financial assets at amortized cost: ①The business mode of the Company to manage the financial
assets targets at collecting the contractual cash flow. ②The contract of the financial assets
stipulates that the cash flow generated in the specific date is the payment of the interest based on
the principal and outstanding principal amount. These financial assets initially measured at fair
value and relevant transaction cost shall be included into the initial recognized amount and
subsequently measured at amortized cost. Except for those designated to be hedge items, the
difference between the initial recognized amount and the amount due shall be amortized at actual
interest rate and their amortization, impairment and exchange gain and loss as well as gains or
losses arising from derecognition shall be recorded into the current profit or loss.
The Company classified the financial assets meeting the following conditions at the same time as
financial assets at fair value through other comprehensive income: ①The Business mode for
managing financial assets of the Company takes contract cash flow collected as target and selling
as target. ②The contract of the financial assets stipulates that the cash flow generated in the
specific date is the payment of the interest based on the principal and outstanding principal
amount. These financial assets initially measured at fair value and relevant transaction cost shall
be included into the initial recognized amount. Except for those designated as hedged items, as
for these financial assets, except for gains or losses on credit impairment, exchange gain and loss
and interest of financial assets measured at actual interest rate, other gains or losses generated
shall be recorded into other comprehensive income. When derecognized, the accumulated gains
and losses originally recorded into other comprehensive income shall be transferred out into the
current profit or loss.
The Company recognizes interest income according to the effective interest rate method. Interest
income is calculated and determined according to the book balance of the financial asset
multiplied by the actual interest rate, except for the following circumstances: ① For the financial
asset with credit impairment that has been purchased or originated, from the initial recognition,
the interest income is calculated and determined according to the amortized cost of the financial
asset and the actual interest rate adjusted by credit. ② For financial assets purchased or originated
that have not suffered credit impairment but have suffered credit impairment in subsequent
periods, the interest income shall be calculated and determined according to the amortized cost
and actual interest rate of the financial assets in subsequent periods.
The Company designates non-transactional investment in equity instruments as financial assets at
fair value through other comprehensive income. Those designated non-transactional investment in
equity instruments by the Company is initially measured at fair value and relevant transaction
172
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
cost shall be recorded into the initial recognized amount. Except for dividends (excluding those
belonging to recovery of investment cost) which shall be recorded into the current profit or loss,
other relevant gains and losses (including exchange gains and losses) shall be recorded into other
comprehensive income and cannot be transferred into the current profit or loss subsequently.
When derecognized, the accumulated gains or losses originally recorded into other
comprehensive income shall be transferred out into retained earnings. Equity instrument
investments measured at fair value through other comprehensive income included: Equity
investments to be held in the long term as planned by the Company for strategic purpose, with no
control, joint control or significance influence, and with no active market quotation.
The Company classifies financial assets not belonging to above two as financial assets at fair
value through profit or loss which shall be initially measured at fair value and relevant transaction
cost shall be directly recorded into the current profit or loss. Gains or losses arising from these
financial assets shall be recorded into the current profit or loss.
The contingent consideration recognized by the Company in the business combination not under
the same control which constitutes a financial asset shall be classified as the financial asset at fair
value through profit or loss.
2) Recognition and measurement of financial assets transfer
The Company derecognizes a financial asset when one of the following conditions is met:
1) the rights to receive cash flows from the asset have expired; 2) the enterprise has transferred its
rights to receive cash flows from the asset to a third party under a pass-through arrangement; or 3)
the enterprise has transferred its rights to receive cash flows from the asset and either (a) has
transferred substantially all the risks and rewards of the asset, or (b) has neither transferred nor
retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
If the overall transfer of financial assets fulfills the requirements for derecognition, the difference
between the book value of the transferred financial assets and the sum of the consideration received
due to the transfer and the corresponding derecognition part of the accumulated amount of fair value
changes originally directly included in other comprehensive income (the contract terms involving the
transferred financial assets stipulate that the cash flow generated on a specific date is only the payment
of the principal and interest based on the unpaid principal amount) shall be included in the current
profits and losses.
If the partial transfer of financial assets satisfies the conditions for termination confirmation, the
entire book value of the transferred financial assets will be apportioned between the termination
confirmation portion and the non-termination confirmation portion according to their relative fair
values, and the consideration received for the transfer And the amount corresponding to the
termination of the recognition of the cumulative amount of changes in fair value originally
included in other comprehensive income that should be apportioned to the derecognition part And
the payment of interest based on the outstanding principal amount), and the difference between
the total book value of the aforesaid financial assets allocated is included in the current profit and
loss.
(2) Financial liabilities
1) Classification, recognition and measurement of financial liabilities
The Company’s financial liabilities are, on initial recognition, classified into financial liabilities at
fair value through profit or loss and other financial liabilities.
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities
and financial liabilities designated at the initial recognition to be measured by the fair value and
their changes are recorded in the current profit or loss. The subsequent measurement shall be at
fair value and gains or losses arising from changes in fair value and the dividends and interest
expense related to the financial liability shall be the current profit or loss.
Other financial liabilities shall be subsequently measured at amortized cost with actual interest
173
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
rate. The Company classifies financial liabilities except for the following items as financial
liabilities at amortized cost: ①Financial liabilities at fair value through profit or loss including
held-for-trading financial liabilities (including the derivative instruments belonging to financial
liabilities) and designated financial liabilities at fair value through profit or loss. ②Financial
liabilities arising from the transfer of financial assets not meeting the derecognition conditions or
continuous involvement in the transferred financial assets. ③Financial guarantee contract not
belonging to cases of above ① or ② and loan commitments at interest rate lower than the market
rate not belonging to the case in ①.
The Company treats the financial liability arising from contingent consideration recognized as the
purchase party in the business combination not under the same control at fair value and changes
thereof shall be recorded into the current profit or loss.
2) Derecognition of financial liabilities
In case of current obligation of financial liabilities (or partial financial liabilities) being
terminated, derecognition of such financial liabilities (or partial financial liabilities) is conducted
by the Company. If the Company (borrower) concludes an agreement with the lender to replace
existing financial liabilities with new ones and contact terms of new financial liabilities are
different from those of existing financial liabilities, derecognition of existing financial liabilities
and recognition of new financial liabilities shall be conducted. In case of material alteration of
contract terms of existing financial liabilities (partial financial liabilities) by the Company,
derecognition of existing financial liabilities and recognition of new financial liabilities as per
modified terms shall be conducted. In case of derecognition of financial liabilities (partial
financial liabilities), the Company includes the balance between its carrying value and payment
consideration into the current profit or loss.
(3) Determination of financial assets and liabilities’ fair value
The Company measured the fair value of financial assets and financial liabilities according to the
price at major market. If major market does not exist, the fair value of financial assets and
financial liabilities was measured according to the price at the most advantageous market through
applying valuation technique applicable at the time and with sufficient usable data and other
information support. The inputs for fair value measurement were classified into three levels.
Level 1 is the unadjusted quotation of the same assets or liabilities on active market available on
the measurement date. Level 2 is the input of relevant assets or liabilities other than that in level 1
that are observable either directly or indirectly. Level 3 is the unobservable input of relevant
assets or liabilities. The Company preferred level 1 input, and applied level 3 input at last. Level 1
input was applicable for listed stock and bond held by the Company, level 2 input for financing of
accounts receivable (mainly bank acceptance bill and trade acceptance bill meeting derecognition
requirements after transfer), and level 3 input for other non-current financial assets (unlisted
equity investment held by the Company) and held-for-trading financial assets (mainly financial
products held by the Company). The level attributed to the fair value measurement result was
determined according to the lowest level of the input with much significance to fair value
measurement in general.
The Company measured the investment of equity instruments at fair value. However, under
limited situation, if the recent information for determining the fair value was insufficient, or the
potential estimated amount of fair value was in wide range, and the cost represented the optimal
174
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
estimation of fair value in such range, such cost could represent appropriate estimation of fair
value in such range. Such equity instrument investments included: Equity investments held by the
Company measured at fair value with changes included in the current profits and losses with no
control, joint control or significance influence; non-trading equity instrument investments were
designated as financial assets measured at fair value through other comprehensive income.
(4) Offsetting financial assets and financial liabilities
The Company’s financial assets and liabilities shall be separately presented in the balance sheet
and not set off each other. But when meeting the following conditions at the same time, the net
amount after offset shall be presented in the balance sheet: (1) The Company has the statutory
right to set off recognized amount which is currently executable; (2) The Company plans to settle
with the net amount or realize the financial asset and pay off the financial liability simultaneously.
(5) The distinction between financial liabilities and equity instruments and related treatment
methods
The Company distinguishes the financial liabilities and equity instruments according to the
following principles: (1) If the Company cannot unconditionally avoid performing a contractual
obligation by delivering cash or other financial assets, the contractual obligation meets the
definition of financial liabilities. Although some financial instruments do not explicitly include
the terms and conditions of the obligation to deliver cash or other financial assets, they may
indirectly form contractual obligations through other terms and conditions. (2) If a financial
instrument must be settled with or can be settled with the Company's own equity instrument, it is
necessary to consider whether the Company's own equity instrument used to settle the instrument
is used as a substitute for cash or other financial assets, or to enable the holder of the instrument
to enjoy the residual equity in the assets of the issuer after deducting all liabilities. If it belongs to
the former condition, the instrument is the financial liability of the issuer; if it belongs to the latter
condition, the instrument is the equity instrument of the issuer. In some cases, a financial
instrument contract requires the Company to use or use its own equity instrument to settle the
financial instrument, in which the amount of contractual rights or contractual obligations is equal
to the number of its own equity instruments available or to be delivered multiplied by its fair
value at the time of settlement, regardless of whether the amount of contractual rights or
obligations is fixed, whether it is entirely or partially based on changes in variables other than the
market price of the Company's own equity instruments, the contract shall be classified as a
financial liability.
In classifying financial instruments (or their components) in the consolidated statement, the
Company has taken into account all terms and conditions reached between the Company
members and the holders of financial instruments. If the Company as a whole undertakes the
obligation to deliver cash, other financial assets or settle accounts in other ways that cause the
instrument to become a financial liability due to the instrument, the instrument shall be classified
as a financial liability.
If financial instruments or their components are financial liabilities, the Company will include
interest, dividends (or dividends), gains or losses, and gains or losses arising from redemption or
refinancing, etc. in the current profits and losses.
If financial instruments or their components are equity instruments, when they are issued
(including refinancing), repurchased, sold or cancelled, the Company will treat them as changes
in equity and will not recognize changes in the fair value of equity instruments.
11. Impairment of Financial Assets
The Company needs to confirm that the financial assets subject to the impairment loss are the
financial assets measured based on the amortized cost, the debt instrument investment measured
based on the fair value with its variations included into other comprehensive incomes and the
lease outlay receivable, mainly including notes receivable, account receivable, other receivables,
175
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
investment on creditor’s rights, other investments on creditor’s rights and long-term receivables
etc. Besides, in respect of the contract assets and partial financial guarantee contract,
corresponding impairment provisions shall be calculated and withdrawn and corresponding credit
impairment losses recognized according to various accounting policies mentioned in this part.
(1) Methods for the Recognition of Impairment Provisions
For all mentioned items above, the Company shall calculate and withdraw corresponding
impairment provisions and recognize corresponding credit impairment losses according to
applicable expected credit loss measurement methods (general methods or simplified methods)
with the expected credit loss as the basis.
Credit loss refers to the difference between all receivable contract cash flows and all expected
cash flows that are discounted to the present value based on the original actual interest rate -- the
present value of all cash shortfall. However, for the purchased or original financial assets subject
to the credit impairment, the Company shall realize the discounting based on the actual interest
rate subject to the credit adjustment.
General methods applied to measure the expected credit loss can be described as: the Company
shall evaluate whether the credit risk of the financial assets (including the contract assets and
other applicable items; the same below) increases remarkably after the initial recognition on the
balance sheet day; if the credit risk increases remarkably after the initial recognition, the
Company shall measure the provision for loss based on the specific expected credit loss amount
during the entire period of existence; if not, the Company shall measure the provision for loss
based on the specific expected credit loss amount in the following 12 months. While evaluating
the expected credit loss, the Company shall take all reasonable and well-founded information into
consideration, including the forward-looking information.
For the financial instrument of lower credit risk on the balance sheet day, the Company shall
assume that its credit risk does not increase remarkably after the initial recognition, and
corresponding provision for loss shall be measured according to the expected credit loss in the
following 12 months.
(2) Standards for Judging Whether the Credit Risk Increases Remarkably after the Initial
Recognition
If any financial assets’ probability of default within the expected period of existence determined
on the balance sheet day is obviously higher than that within the expected period of existence
determined during the initial recognition, it shall indicate the remarkable increase of the financial
assets’ credit risk. Unless it is under special circumstances, the Company shall adopt various
variations in the default risk in the following 12 months as the reasonable basis for estimating
corresponding variations in the default risk within the entire period of existence and determining
whether the credit risk increases remarkably after the initial recognition.
(3) Combined Method for Evaluating the Expected Credit Risk based on Corresponding
Combination
For the financial assets with remarkably different credit risk, the Company shall separately
evaluate its credit risk, including the receivables from related parties, receivables involved in any
dispute with the other party or any lawsuit and arbitration, and receivables with obvious evidence
showing that the debtor cannot fulfill the due payment obligation etc.
Except for the financial assets whose credit risk shall be separately evaluated, the Company shall
divide these financial assets into different combinations based on the specific risk features, on
which basis, corresponding credit risks can be evaluated.
(4) Accounting Treatment Methods Applied to the Impairment of Financial Assets
176
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
At the end of the period, the Company shall calculate the expected credit losses of various
financial assets. If the expected credit loss is higher than the carrying amount of its current
impairment provision, the difference shall be recognized as the impairment loss; if lower, the
difference shall be recognized as the gain from the impairment.
12. Notes Receivable
For notes receivable, the Company shall measure the provision for loss based on the specific
expected credit loss during the entire period of existence. According to the credit risk
characteristics thereof, except those with separate evaluation of credit risk, notes receivable can
be divided into different combinations:
Item Basis
Bank Acceptance The Accepter shall be the bank with high credit level and low risks
Trade Acceptance Classified by credit risk of acceptors (the same as accounts receivable)
13. Accounts Receivable
For account receivable and contract assets excluding significant financing composition, the
Company shall measure the provision for loss according to the specific expected credit loss
amount within the entire period of existence.
For account receivable, contract assets and lease payment receivable including significant
financing composition, the Company shall always measure the provision for loss according to the
specific expected credit loss amount within the period of existence.
Except the account receivable and contract assets whose credit risks shall be separately evaluated,
the Company shall divide them into different combinations based on the specific credit risks:
Item Basis
Aging Combination This portfolio is accounts receivable with aging as the credit risk feature.
Project Funds Combination This portfolio is the project-related receivables.
Related party combination The accounts receivable within the scope of consolidation
14. Accounts Receivable Financing
The Company’s accounts receivable financing is based on expected credit losses, and provision is
made for depreciation reserves in accordance with the expected credit loss measurement method
for notes receivable.
15. Other Receivables
The Company measures the loss reserves on other receivables in accordance with the following
circumstances: a) For financial assets whose credit risk has not significantly increased since the
initial recognition, the Company measures the loss reserves at the amount of expected credit
losses for the next 12 months; b) For financial assets whose credit risk has increased significantly
since the initial recognition, the Company measures the loss reserves at an amount equal to the
177
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
expected credit losses for the entire period of the financial instrument; c) For financial assets
purchased or originated from credit impairment, the Company measures the loss reserves at an
amount equal to the expected credit losses over the entire period of the financial instrument.
Except other receivables whose credit risks shall be separately evaluated, the Company shall
divide them into different combinations based on the specific credit risk features:
Item Basis
Aging Combination This portfolio is accounts receivable with aging as the credit risk feature.
This combination shall regard other receivables of extremely low risk
Low Risk Combination (including the revolving fund, the cash deposit and the guarantee deposit) as
the credit risk feature.
Related party combination Other receivables within the scope of consolidation.
16. Long-term Receivables
By determining whether the credit risk of long-term account receivables increases remarkably
after the initial recognition, the Company shall measure the impairment loss based on the specific
expected credit loss in the following 12 months or during the entire period of existence. Except
long-term account receivables whose credit risks shall be separately evaluated, the Company shall
divide them into different combinations based on the specific credit risk features:
Item Basis
Financing Lease Regarding the long-term receivables related to the financing lease as the credit
Combination risk characteristics
Regarding the long-term receivables related to the PPP Project as the credit risk
Franchise Combination
characteristics
17. Inventories
The Company's inventories mainly include raw materials, products in process, semi-finished
products, and entrusted processing materials.
The perpetual inventory method is used for inventories. Inventories are priced at the actual cost at
the time of acquisition; the actual cost of inventories is determined by the weighted average
method when inventories are claimed or issued. Low-value consumables and packaging are
amortized through the one-off charge-off method.
The net realizable value of inventories of goods that are used directly for sale, such as inventory
goods, products in process, and materials for sale, is determined by the estimated selling price of
the inventory minus estimated sale expenses, and related taxes; the net realizable value of
inventories of materials held for production is determined by the estimated selling price of the
finished goods produced minus the estimated costs of completion, estimated sale expenses, and
related taxes.The inventories with various numbers and low unit price shall be made provisions
for depreciation reserves of inventories according to the category of inventories. For inventories
that are produced and sold in the same region with same or similar end use or purposes, and hard
178
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
to be measured separately from other items, it shall be made merger provisions for falling price of
inventories.
The net realizable value refers, in the ordinary course of business, to the account 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.
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.
18. Contract Assets
(1) Confirmation methods and standards of contract assets
Contract assets refer to the right of the company to receive consideration after transferring goods
to customers, and this right depends on factors other than the passage of time. If the company
sells two clearly distinguishable products to customers, it has the right to receive payment
because one of the products has been delivered, but the payment is also dependent on the delivery
of the other product, the company has the right to receive payment as a contract assets.
(2) Determination method and accounting treatment method of expected credit loss of contract
assets
The method of determining the expected credit loss of contract assets, refer to the description of
11. Financial Asset Impairment, 12. Notes Receivable, 13. Accounts Receivable.
The company calculates the expected credit loss of contract assets on the balance sheet date. If the
expected credit loss is greater than the book value of the current contract asset impairment
provision, the company will recognize the difference as an impairment loss and debit the "asset
impairment loss". Credited "Contract asset impairment provision". On the contrary, the company
recognizes the difference as an impairment gain and keeps the opposite accounting records.
If the company actually incurs credit losses and determines that the relevant contract assets
cannot be recovered, and the written-off is approved, the "contract asset impairment reserve" is
debited and the "contracted asset" is credited based on the approved write-off amount. If the
written-off amount is greater than the provision for loss that has been withdrawn, the "asset
impairment loss" is debited based on the difference.
19. Contract Costs
(1) The method of determining the amount of assets related to contract costs
The company’s assets related to contract costs include contract performance costs and contract
acquisition costs.
The contract performance cost, that is, the cost incurred by the company for the performance of
the contract, does not fall within the scope of other accounting standards and meets the following
conditions at the same time, as the contract performance cost is recognized as an asset: the cost
and a current or expected contract Directly related, including direct labor, direct materials,
manufacturing expenses (or similar expenses), clearly the cost borne by the customer, and other
costs incurred only due to the contract; this cost increases the company's future resources for
fulfilling its performance obligations; This cost is expected to be recovered.
The contract acquisition cost, that is, the incremental cost incurred by the company to obtain the
contract is expected to be recovered, and is recognized as an asset as the contract acquisition cost;
179
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
if the asset amortization period does not exceed one year, it is included in the current profit and
loss when it occurs. Incremental cost refers to the cost (such as sales commission, etc.) that the
company will not incur without obtaining the contract. The company's expenses incurred in
obtaining the contract, other than the expected incremental cost that can be recovered (such as
travel expenses incurred regardless of whether the contract is obtained, etc.), are included in the
current profit and loss when they are incurred, but it is clearly borne by the customer except.
(2) Amortization of assets related to contract costs
The company’s assets related to contract costs are amortized on the same basis as the commodity
revenue recognition related to the asset and included in the current profit and loss.
(3) Impairment of assets related to contract costs
When the company determines the impairment loss of assets related to contract costs, it first
determines the impairment loss of other assets related to the contract that are confirmed in
accordance with other relevant business accounting standards; then, based on their book value
higher than the company’s transfer and If the difference between the remaining consideration that
the asset-related commodity is expected to obtain and the estimated cost incurred for the transfer
of the relevant commodity, the excess shall be provided for impairment and recognized as an
asset impairment loss.
If the depreciation factors of the previous period have changed, and the aforementioned difference
is higher than the book value of the asset, the original provision for asset impairment shall be
reversed and included in the current profit and loss, but the book value of the asset after the
reversal shall not exceed Assuming no provision for impairment is made, the book value of the
asset on the date of reversal.
20. Long-term Equity Investments
The Company's long-term equity investments mainly consist of investments in subsidiaries,
associated enterprises, and joint ventures.
The Company’s judgment on joint control is based on the fact that all participants or a
combination of participants collectively control the arrangement and that the policies of the
activities related to the arrangement shall be unanimously agreed by those participants who
The Company is generally considered to have a significant influence on the investee when it owns,
directly or indirectly through a subsidiary, above 20% but below 50% of the voting rights of the
investee. If the Company holds less than 20% of the voting rights of the investee, it also needs to
judge whether the Company has a significant influence on the investee by taking into account the
facts and circumstances such as having representatives on the board of directors or similar
authority of the investee, or participating in the process of formulating financial and operating
policies of the investee, or having major transactions with the investee, or sending management
personnel to the investee, or providing key technical information to the investee.
If control over the investee is formed, it is a subsidiary of the Company. For long-term equity
investment acquired through business combination under the same control, the initial investment
cost of the long-term equity investments is recorded at the merger date based on the acquisition of
the merged party's share of the book value of the net assets of the ultimate controller in the
consolidated financial statement. If the book value of the net assets of the merged party on the
merger date is negative, the cost of long-term equity investments is determined as zero.
If the equity of the investee under the same control is acquired in stages through multiple
transactions to eventually result in a business combination, additional disclosures of the treatment
of long-term equity investments in the parent company's financial statements shall be made in the
180
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period in which control is obtained. For example, if the business combination that is
ultimately formed through multiple transactions to acquire the equity of the investee under the
same control belongs to a package deal, the Company shall conduct accounting treatment to treat
each transaction as a single transaction to acquire control. If the transaction is not a package deal,
the initial investment cost of the long-term equity investment is based on the share of the book
value of the net assets of the merged party in the consolidated financial statements of the ultimate
controller at the merger date. The difference between the initial investment cost and the sum of
the book value of the long-term equity investment before the merger plus the book value of the
new consideration paid for further acquisition of shares at the merger date shall offset against
capital reserve; and where capital reserve is insufficient to be offset, the retained earnings shall be
adjusted.
For long-term equity investment acquired through business combination not under the same
control, the initial investment cost shall be the consolidation cost.
If the equity of the investee not under the same control is acquired in stages through multiple
transactions to eventually result in a business combination, additional disclosures of the cost
treatment of long-term equity investments in the parent company's financial statements shall be
made in the Reporting Period in which control is obtained. For example, if the business
combination that is ultimately formed through multiple transactions to acquire the equity of the
investee not under the same control belongs to a package deal, the Company shall conduct
accounting treatment to treat each transaction as a single transaction to acquire control. If the
transaction is not a package deal, the sum of the book value of the equity investment originally
held plus the cost of the new investment shall be the initial investment cost calculated in
accordance with the cost method. If the equity held prior to the purchase date is accounted by the
equity method, the relevant other comprehensive income accounted by the original equity method
shall not be adjusted. The same basis of accounting as that used for the direct disposal of the
related assets or liabilities by the investee is used for the disposal of the investment. If the equity
held prior to the purchase date is a financial asset designated to be measured at fair value with
fluctuations included in other comprehensive income, the cumulative profit or loss on the equity
previously recognized in other comprehensive income shall be transferred from other
comprehensive income to the retained earnings; if the equity is a financial asset measured at fair
value and the changes of which are included in profits and losses of the current period, the equity
previously recognized as profits and losses from the changes in fair value shall not be transferred
to investment income. If the equity held prior to the purchase date is an investment for other
equity instruments, the changes in fair value of the equity investment accumulated in other
comprehensive income before the purchase date shall be transferred to the retained earnings.
Except for the long-term equity investments acquired through business combination hereinabove,
long-term equity investments acquired by paying cash are recorded as investment cost based on
the actual purchase price paid; long-term equity investments acquired by issuing equity securities
are recorded as investment cost based on the fair value of the equity securities issued; long-term
equity investments invested by investors are recorded as investment cost based on the value
agreed in the investment contract or agreement.
The Company calculates its investments in subsidiaries through the cost method and its
investments in joint ventures and associate enterprises through the equity method.
For long-term equity investments calculated by the cost method for subsequent measurement, the
book value of the cost of long-term equity investments shall be increased by the fair value of the
cost amount paid for the additional investment and relevant transaction costs incurred when the
181
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
additional investment is made. Cash dividends or profits declared by the investee are recognized
as investment income for the current period in accordance with the due amount.
In addition to the above-mentioned long-term equity investment obtained through business
combination, the long-term equity investment obtained by paying cash shall be regarded as the
investment cost according to the purchase price actually paid; the long-term equity investment
obtained by issuing equity securities shall be regarded as the investment cost according to the fair
value of issuing equity securities; the long-term equity investment invested by investors shall be
regarded as the investment cost according to the investment contract or agreement The value of
the company is regarded as the cost of investment.
The company adopts the cost method for investment in subsidiaries and the equity method for
investment in joint ventures and associated enterprises.
For the long-term equity investment whose subsequent measurement adopts the cost method,
when the additional investment is made, the book value of the long-term equity investment cost is
increased according to the fair value of the cost amount paid by the additional investment and the
relevant transaction expenses. The cash dividends or profits declared to be distributed by the
investee shall be recognized as the current investment income according to the amount that
should be enjoyed.
For the long-term equity investment with equity method for subsequent measurement, the book
value of the long-term equity investment will increase or decrease with the change of the owner's
equity of the invested entity. When confirming the share of the net profit and loss of the investee,
the net profit and loss of the investee shall be calculated based on the fair value of the identifiable
assets of the investee at the time of obtaining the investment, in accordance with the accounting
policies and accounting period of the company, and offset the internal transaction profit and loss
between the joint venture and the joint venture according to the shareholding ratio Profit is
recognized after adjustment.
For disposal of long-term equity investment, the difference between the book value and the actual
price shall be included in the current investment income. For long-term equity investment
accounted by equity method, other comprehensive income accounted by the original equity
method shall be accounted on the same basis as the investee's direct disposal of relevant assets or
liabilities when the equity method is terminated, and the owner's equity shall be recognized due to
other changes in owner's equity of the investee except net profit and loss, other comprehensive
income and profit distribution When the equity method is terminated, all of them shall be
transferred into the current investment income.
In case of loss of joint control or significant influence on the investee due to the disposal of part
of equity investment, the remaining equity after disposal shall be accounted according to the
relevant provisions of the recognition and measurement standards of financial instruments, and
the difference between the fair value and the book value of the remaining equity on the date of
loss of joint control or significant influence shall be included in the current profits and losses.
When the equity method is terminated, the other comprehensive income of the original equity
investment recognized as a result of its accounting with the equity method shall be handled on the
same basis as the investee's direct disposal of the relevant assets or liabilities and carried forward
in proportion. The owner's equity recognized as a result of the changes in the owner's equity of
the investee other than net profit and loss, other comprehensive income and profit distribution
shall be carried forward in proportion Transfer to current investment income.
If the control over the investee is lost due to the disposal of part of the long-term equity
investment, and the residual equity after disposal can jointly control or exert significant influence
182
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
on the investee, it shall be accounted according to the equity method, and the difference between
the book value of the disposal equity and the disposal consideration shall be included in the
investment income, and the residual equity shall be regarded as adjusted by the equity method
when it is obtained If the residual equity cannot exercise joint control or exert significant
influence on the investee, the accounting treatment shall be carried out according to the relevant
provisions of the recognition and measurement standards of financial instruments. The difference
between the book value of the disposal equity and the disposal consideration shall be included in
the investment income, and the difference between the fair value and the book value of the
residual equity on the day of losing control shall be included in the current profits and losses.
If the transaction from step-by-step disposal of equity to loss of control right does not belong to
package transaction, accounting treatment shall be carried out for each transaction separately. If it
is a "package deal", each transaction will be treated as a transaction of disposal of subsidiaries
and loss of control. However, before the loss of control, the difference between the disposal price
of each transaction and the book value of the long-term equity investment corresponding to the
disposed equity will be recognized as other comprehensive income, and when the control is lost,
it will be transferred to the current account of loss of control Period profit and loss
21. Investment Property
The term “investment property” refers to the real estate held for generating rent and/or capital
appreciation. Investment property of the Company 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.In addition, if the
board of directors (or similar organizations) makes a written resolution to use the vacant buildings
held by the company for operating lease and the holding intention will not change in a short time,
they will also be listed as investment real estate.
The initial measurement of the investment property shall be made at its cost. Subsequent
expenditures incurred for an investment property is included in the cost of the investment
property when it is probable that economic benefits associated with the investment property will
flow to the Company 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 Company shall make a follow-up measurement to the investment property by employing the
cost pattern on the date of the balance sheet. An accrual depreciation or amortization shall be
made for the investment property 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 property, please refer to Note IV. 26. “Long-term assets impairment”.
The company's investment real estate adopts the average life method for depreciation or
amortization. The expected service life, net residual value rate and annual depreciation
(amortization) rate of all kinds of investment real estate shall refer to the depreciation policy of
buildings in fixed assets and the amortization policy of land use right in intangible assets..When
owner-occupied real estate or inventories are changed into investment property or investment
property is changed into owner-occupied real estate, of which book value prior to the change shall
be the entry value after the change.
When an investment property is changed to an owner-occupied real estate, it would be 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
183
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
transferred to investment property at the date of such change. If the fixed asset or intangible asset
is changed into investment property 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 property measured by adopting the fair value pattern, whose fair value
on the date of such change shall be the entry value after the change
An investment property is derecognized on disposal or when the investment property 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 property less its
carrying amount and related taxes and expenses is recognized in profit or loss in the period in
which it is incurred.
22. Fixed Assets
The Company’s fixed assets are tangible assets held for the production of goods, provision of
services, rental or operation management and have a useful life of more than one year.
Fixed assets should be recognized when it is probable that the economic benefits associated with
them will be incorporated into the Company and their cost can be measured reliably. The
Company’s fixed assets include buildings and constructions, machinery and equipment, electronic
equipment, transportation equipment, and other equipment.
The Company depreciates all fixed assets by straight-line method, except for fully depreciated
fixed assets that continue to be used and land that is separately valued. The categorized
depreciable lives, estimated net salvage rates and depreciation rates of the Company’s fixed assets
are as follows.
Annual
Depreciation Expected net
No. Category Method deprecation
period (year) salvage value (%)
(%)
Housing and Straight-line
20-40 5-10.00 2.25-4.75
building depreciation
1
Machinery Straight-line
5-10 5-10.00 9.00-19.00
equipment depreciation
2
Electronic Straight-line
3-5 5-10.00 18.00-31.67
equipment depreciation
3
Transportation Straight-line
3-5 5-10.00 18.00-31.67
vehicle depreciation
4
Straight-line
Other equipment 5 5-10.00 18.00-19.00
depreciation
5
The estimated useful life, estimated net salvage value and depreciation method of fixed assets are
reviewed at the end of each year. Accounting estimation methods are used when changes are
required.
184
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The Company’s fixed assets under finance leases are mainly machinery and equipment. The basis
for recognizing them as fixed assets under finance leases is that, during the lease term, the
Company receives substantially all the economic benefits provided by the assets, while assuming
the risks associated with the assets.
The lower of the fair value of the fixed assets under finance leases and the present value of the
minimum lease payments will be recognized as the recorded value of the leased-in assets. The
difference between the recorded value of the leased-in assets and the minimum lease payments is
recognized as an unrecognized financing expense.
Fixed assets under finance leases are depreciated in the same manner as owned fixed assets. If it
is reasonably certain that ownership of the leased asset will be obtained at the end of the lease
term, the leased fixed asset is depreciated over its estimated useful life; otherwise, the leased
fixed asset is depreciated over the shorter of the lease term and the estimated useful life of the
asset.
23. Construction in Progress
On the date when the construction in progress reaches its intended useable state, fixed assets are
carried forward at the estimated value based on the project budget, cost or actual cost of the
project, etc. Depreciation starts from the following month, and the difference in the original value
of fixed assets is adjusted after the completion of the final accounting procedures.
24. Borrowing Costs
For incurred borrowing costs, which can be directly attributed to fixed assets, investment real
estate and inventory that need more than one year of purchasing, construction or production
activities to reach the preset usable or sellable status, shall be capitalized when the asset
expenditure has occurred, the borrowing costs have occurred, and the purchasing, construction or
production activities necessary for the asset to reach the preset usable or sellable status have
begun; When the acquisition, construction or production of assets that meet the capitalization
conditions reach the intended usable or sellable status, capitalization is stopped, and the
borrowing costs incurred thereafter are included in the profits and losses of the current period. If
there is an abnormal interruption in the acquisition, construction or production of assets that meet
the capitalization conditions and the interruption lasts for more than 3 consecutive months, the
capitalization of borrowing costs will be suspended until the acquisition, construction or
production of assets starts again.
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.
25. Intangible Assets
The Company’s intangible assets include land use rights, patented technology and
non-proprietary technology, which are measured at actual cost at the time of acquisition.
Acquired intangible assets are stated at actual cost based on the actual price paid and related other
expenses. The actual cost of intangible assets invested by investors is determined at the value
185
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
agreed in the investment contract or agreement, but if the agreed value in the contract or
agreement is not fair, the actual cost is determined at fair value. Intangible assets, such as patents,
acquired in a merger not under common control but owned by the acquiree but not recognized in
its financial statements, are recognized as intangible assets at fair value at the time of initial
recognition of the acquiree’s assets.
Land use rights are amortized equally over the years from the commencement date of the grant;
intangible assets such as software and patents are amortized equally over the shortest of the
estimated useful life, the contractual beneficiary life and the effective life prescribed by law. The
amortization amount is charged to the cost of the related assets and current profit or loss
according to their beneficiaries. The estimated useful life and amortization method of intangible
assets with finite useful lives are reviewed at the end of each year. Accounting estimation
methods are used when changes are required.
The main research and development projects of the Company include the AIOT scene voice
system based on NLP algorithm.
(1) Specific criteria for dividing the research phase and development phase
“Research” means an original and planned investigation to acquire and understand new scientific
or technical knowledge.
“Development” means the application of research results or other knowledge to one or more plans
or designs to produce new or substantially improved materials, devices, products, or to obtain
new processes, etc., prior to commercial production or use.
Expenses for the research phase are charged to current profit or loss as incurred.
(2) Specific criteria for capitalization of development stage expenditures
Expenditures in the development stage are capitalized when the following conditions are met.
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;
⑤ The development expenditures of the intangible assets can be reliably measured.
26. Impairment of Long-term Assets
For non-current financial Assets of fixed Assets, projects under construction, intangible Assets
with limited service life, investing real estate with cost model, long-term equity investment of
subsidiaries, cooperative enterprises and joint ventures, the Company should judge whether
decrease in value exists on the date of balance sheet. Recoverable amounts should be tested for
decrease in value if it exists. Other intangible Assets of reputation and uncertain service life and
other non-accessible intangible assets should be tested for decrease in value no matter whether it
exists.
If the recoverable amount is less than carrying value in impairment test results, the provision for
186
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
impairment of differences should include in impairment loss. Recoverable amounts would be the
higher of net value of asset fair value deducting disposal charges or present value of predicted
cash flow. Asset fair value should be determined according to negotiated sales price of fair trade.
If no sales agreement exists but with asset active market, fair value should be determined
according to the Buyer’s price of the asset. If no sales agreement or asset active market exists,
asset fair value could be acquired on the basis of best information available. Disposal expenses
include legal fees, taxes, cartage or other direct expenses of merchantable Assets related to asset
disposal. Present value of predicted asset cash flow should be determined by the proper discount
rate according to Assets in service and predicted cash flow of final disposal. Asset depreciation
reserves should be calculated on the basis of single Assets. If it is difficult to predict the
recoverable amounts for single Assets, recoverable amounts should be determined according to
the belonging asset group. Asset group is the minimum asset combination producing cash flow
independently.
In impairment test, carrying value of the business reputation in financial report should be shared
to beneficial asset group and asset group combination in collaboration of business merger. It is
shown in the test that if recoverable amounts of shared business reputation asset group or asset
group combination are lower than book value, it should determine the impairment loss.
Impairment loss amount should firstly be deducted and shared to the carrying value of business
reputation of asset group or asset group combination, then deduct carrying value of all assets
according to proportions of other carrying value of above assets in asset group or asset group
combination except business reputation.
After the asset impairment loss is determined, recoverable value amounts would not be returned
in future.
27. Long-term Deferred Expenses
The Long-term deferred expenses of the Company including renovation cost, mold cost and so on
shall be amortized evenly during the benefit period. If these long-term deferred expenses cannot
benefit the future accounting period, the amortized value of this item that has not been amortized
shall be transferred to the current profit and loss.
28. Contract Liabilities
Liabilities of contracts refer to the Company's obligation to transfer goods to customers due to the
consideration received or receivable from customers. Before the transfers, if the customer has
paid the consideration or if the Company has obtained the right to unconditionally collect the
contract consideration, the liabilities of contracts shall be recognized based on the amount
received or receivable at the earlier point between the actual payment by the customer and the
payment due.
29. Employee Compensation
Salaries of staff of the Company include short-term salary, post-employment benefits, termination
compensation, and other long-term benefits.
Short-term salary mainly includes wages, bonuses, allowances and subsidies, as well as employee
benefits, medical insurance, maternity insurance, employment injury insurance, housing provident
fund, labor union expenses, and staff education expenses, and non-monetary benefits. During the
accounting period when the employees provide services, the actual short-term compensation is
recognised as a liability that shall be included in the current profit and loss or the cost of related
assets according to the beneficiary.
187
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The post-employment benefits mainly include the basic endowment insurance, etc. They are
divided into defined contribution plans and defined benefit plans in accordance with the risks and
obligations undertaken by the Company. According to the defined contribution plan, the deposit
paid to a separate entity in exchange for the services provided by the employees during the
accounting period on the balance sheet date is recognized as liabilities, and shall be included in
the current profit and loss or the cost of related assets according to the beneficiary. If the
Company has a defined benefit plan, the specific accounting method should be explained.
When terminating labour relations before expiration of contract, or layoffs with compensations,
and the Company cannot terminate the labour relations unilaterally or reduce the demission
welfare, remuneration and liabilities produced from the demission welfare should be determined
and included in current profits and losses when determining the costs of demission welfare and
recombination. However, demission welfare not fully paid within 12 months after annual
Reporting Period should be handled the same as other long-term employees’ payrolls.
The inside employee retirement plan is treated by adopting the same principle with the above
dismiss ion welfare. The Company would recorded the salary and the social security insurance
fees paid and so on from the employee’s service termination date to normal retirement date into
current profits and losses (dismission welfare) under the condition that they meet the recognition
conditions of estimated liabilities.
The other long-term welfare that the Company offers to the staffs, if met with the setting drawing
plan, should be accounting disposed according to the setting drawing plan, while the rest should
be disposed according to the setting revenue plan.
30. Provisions
The Company should recognize the related obligation as a provision for liability when the
obligation meets the following conditions: (1) That obligation is a present obligation of the
enterprise; (2) It is probable that an outflow of economic benefits from the enterprise will be
required to settle the obligation; (3) A reliable estimate can be made of the amount of the
obligation.
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 provisions 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 provisions 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 carrying value of the estimated
liabilities.
31. Principles of Revenue Recognition and Measurement Method
The revenue of the Company mainly consists of the income from main business and the income
from other businesses.
(1)Revenue recognition principle
The company has fulfilled the performance obligations in the contract, that is, when the customer
obtains control of the relevant goods or services, revenue is recognized. Obtaining control over
188
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
related goods or services means being able to lead the use of the goods or the provision of such
services and obtain almost all of the economic benefits from it.
On the starting date of the contract, the company evaluates the contract, identifies each individual
performance obligation contained in the contract, and determines whether each individual
performance obligation is performed within a certain period of time or at a certain point in time.
When one of the following conditions is met, it is a performance obligation within a certain
period of time, otherwise, it is a performance obligation at a certain point in time:
①The customer obtains and consumes the economic benefits brought by the company's
performance at the same time the company performs the contract.
②The customer can control the products under construction during the performance of the
company.
③The goods produced during the performance of the company have irreplaceable uses, and the
company has the right to collect payments for the cumulative performance of the contract during
the entire contract period.
For performance obligations performed within a certain period of time, the company recognizes
revenue according to the performance progress during that period. When the performance
progress cannot be reasonably determined, if the cost incurred by the company is expected to be
compensated, the revenue shall be recognized according to the amount of the cost incurred until
the performance progress can be reasonably determined.
For performance obligations performed at a certain point in time, the company recognizes
revenue at the point when the customer obtains control of the relevant goods or services. When
judging whether a customer has obtained control of goods or services, the company considers the
following signs:
①The Company enjoys the current right to receive payment for the goods or services.
②The Company has transferred the legal ownership of the product to the customer.
③The Company has transferred the goods in kind to the customer.
④The Company has transferred the main risks and rewards of the ownership of the product to the
customer.
⑤The customer has accepted the goods or services.
The company has transferred goods or services to customers and the right to receive consideration
is listed as contract assets, and contract assets are devalued on the basis of expected credit losses.
The company's unconditional right to collect consideration from customers is listed as receivables.
The company’s obligation to transfer goods or services to customers due to the consideration
received from customers is listed as contract liabilities.
189
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(2) Principles of income measurement
① If the contract contains two or more performance obligations, at the beginning of the contract,
the company will allocate the transaction price to each individual performance obligation based
on the relative proportion of the stand-alone selling price of the goods or services promised by
each individual performance obligation. Revenue is measured at the transaction price of each
individual performance obligation.
②The transaction price is the amount of consideration that the company expects to be entitled to
receive due to the transfer of goods or services to customers, excluding payments collected on
behalf of third parties and payments expected to be returned to customers. The transaction price
confirmed by the company does not exceed the amount at which the accumulated confirmed
income will most likely not undergo a significant reversal when the relevant uncertainty is
eliminated. It is expected that the money returned to the customer will not be included in the
transaction price as a liability.
③If there is variable consideration in the contract, such as cash discounts and price guarantees in
part of the contract between the company and its customers, the company determines the best
estimate of the variable consideration according to the expected value or the most likely amount,
but includes the variable The transaction price of the consideration shall not exceed the amount at
which the accumulated confirmed income is unlikely to be reversed significantly when the
relevant uncertainty is eliminated.
④For the consideration payable to customers, the company offsets the transaction price from the
consideration payable to customers, and offsets the current income at the time when the relevant
income is recognized and the payment (or promised to pay) the customer consideration is later,
unless the consideration payable is for Obtain other clearly distinguishable products from
customers.
⑤For sales with a sales return clause, when the customer obtains control of the relevant product,
the company recognizes revenue based on the amount of consideration expected to be received
due to the transfer of the product to the customer, and the expected return due to the sales return
is recognized as an estimated liability ; At the same time, according to the expected book value of
the returned goods at the time of transfer, the balance after deducting the estimated cost of
recovering the goods (including the value impairment of the returned goods) is recognized as an
asset, that is, the return cost receivable, according to the transferred goods The book value at the
time of the transfer, deducting the net carry-over cost of the aforementioned asset cost. On each
balance sheet date, the company re-estimates the future sales returns and re-measures the
aforementioned assets and liabilities.
⑥ If there is a significant financing component in the contract, the company shall determine the
transaction price based on the amount payable in cash when the customer assumes control of the
goods or services. Using the discount rate that discounts the nominal amount of the contract
consideration into the current commodity price, the difference between the determined transaction
price and the amount of the consideration promised in the contract is amortized by the actual
interest method during the contract period. On the starting date of the contract, the company
190
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
expects that the time between the customer's acquisition of control of the goods or services and
the customer's payment of the price will not exceed one year, regardless of the significant
financing components in the contract.
⑦According to contractual agreements, legal provisions, etc., the company provides quality
assurance for the products sold and the assets built. For guarantee-type quality assurance to assure
customers that the goods sold meet the established standards, the company conducts accounting
treatment in accordance with "contingent events-estimated liabilities". For the service quality
assurance that provides a separate service in order to assure customers that the goods sold meet
the established standards, the company regards it as a single performance obligation, based on the
stand-alone selling price of the quality assurance of goods and services. In a relative proportion,
part of the transaction price is allocated to service quality assurance, and revenue is recognized
when the customer obtains control of the service. When assessing whether the quality assurance
provides a separate service in addition to ensuring that the products sold meet the established
standards, the company considers whether the quality assurance is a legal requirement, the quality
assurance period, and the nature of the company's commitment to perform the tasks.
⑧ When the construction contract between the company and the customer is changed: ①If the
contract change adds clearly distinguishable construction services and contract prices, and the
new contract price reflects the stand-alone selling price of the new construction services, the
company will The contract change shall be treated as a separate contract for accounting treatment;
②If the contract change does not fall into the above-mentioned circumstance ①, and there is a
clear distinction between the construction services that have been transferred and the construction
services that have not been transferred on the date of the contract change, the company Treat it as
the termination of the original contract, and at the same time, merge the unfulfilled part of the
original contract and the changed part of the contract into a new contract for accounting treatment;
③If the contract change does not fall into the above situation ①, and the construction service has
been transferred on the date of contract change There is no clear distinction between the
construction service and the untransferred construction service. The company accounts for the
changed part of the contract as a component of the original contract. The resulting impact on the
recognized revenue will be adjusted on the date of contract change.
(3) Specific methods of revenue recognition
① Revenue recognized on time
The company's sales of household appliances, electronic components, etc., belong to the
performance obligation performed at a certain point in time.
Recognition conditions for income from domestic sales of goods and overseas direct sales of
goods: The company has delivered the product to the customer in accordance with the contract
and the customer has received the product, the payment has been recovered or the receipt of
payment has been obtained, and the relevant economic benefits are likely to flow in. The main
risks and rewards have been transferred, and the legal ownership of the goods has been
transferred.
Conditions for confirming the income of exported goods: The company has declared the products
for export according to the contract, obtained the bill of lading, and delivered the goods to the
191
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
carrier entrusted by the purchaser. The payment has been recovered or the receipt of payment has
been obtained and relevant economic benefits are likely to flow in. The main risks and rewards of
commodity ownership have been transferred, and the legal ownership of commodities has been
transferred.
②Income confirmed according to the performance progress
The company's business contracts with customers for project construction, online advertising,
operating leases, etc. are performance obligations performed within a certain period of time, and
revenue is recognized according to the progress of the performance.
32. Government Grants
The government grants of the Company are divided into asset-based grants related to and
income-based grants. Asset-based grants refer to the government grants for long-term assets
obtained by the purchase, construction, and other ways. Income-based grants refer to other grants.
If the beneficiaries are not specified in government documents, the Company will make the
distinction according to the aforesaid principle. Beneficiaries which are difficult to categorize
shall be classified as an income-based government grant as a whole.
Current elements of government grants shall be measured based on the amount actually received.
Those shall be measured according to the amount receivable are grants paid according to a fixed
quota standard, or funds that meet the relevant conditions stipulated by the financial support
policy with conclusive evidence at the end of the year and which are expected as the financial
support. Non-monetary elements of the government grants shall be measured at fair value. Those
whose fair value cannot be obtained reliably shall be measured at its nominal amount (RMB1).
Asset-based grants shall be used to offset the carrying value of related assets or presented as
deferred income, and shall, over the life of the related asset, be included in the current profits and
losses by the equal amortization method.
If the related asset is sold, transferred, scrapped, or damaged before the end of its useful life, its
deferred income that has not been distributed shall be transferred to the current profit and loss of
asset disposal.
Income-based grants that are used to compensate related costs or losses in subsequent periods
shall be deemed as deferred income and shall be included in the current profits and losses during
the period when the related costs or losses are recognized. Government grants related to routine
activities shall be included in other income in accordance with the nature of the transaction.
Government grants not related to routine activities shall be included in non-operating income and
expenditure.
The Company obtains interest grants on policy-related concessional loans in two different ways:
the interest subsidy funds are allocated by the government either to the lending bank or directly to
the Company. The respective accounting treatment is carried out as follows:
(1) Where the government allocates the funds to the lending bank, and the bank provides a loan to
the Company at a policy-related preferential interest rate, the actual amount of the loan received
is taken as the entry value, and the borrowing costs are calculated based on the loan principal and
the policy-related preferential interest rate. (Alternatively, the fair value of the loan is taken as the
entry value, and the borrowing costs are calculated using the effective interest rate method. The
difference between the actual amount received and the fair value is recognized as deferred income,
192
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
which is amortized using the effective interest rate method during the loan term to offset
borrowing costs);
(2) Where the government allocates the funds directly to the Company, the grants are offset
against borrowing costs.
Where the government grants that the Company has recognized in accounting need to be returned,
the accounting treatment in the current period is carried out as follows:
1) If the book value of an asset is offset on initial recognition, the book value will be adjusted;
2) If there is deferred income, the book balance of the deferred income will be offset, and the
excess will be included in profit or loss in the current period;
3) Under any other circumstances, the grants will be included in profit or loss in the current
period.
33. Deferred Income Tax Assets/Deferred Income Tax Liabilities
The Company's deferred tax assets and deferred tax liabilities are calculated and recognized based
on the difference (temporary difference) between the tax base and book value of the assets and
liabilities. In the case of deductible losses that can be deducted from taxable income in
subsequent years in accordance with the provisions of the tax laws, the corresponding deferred
income tax assets are recognized. In the case of temporary differences arising from the initial
recognition of goodwill, the corresponding deferred income tax liabilities are not recognized.
With respect to temporary differences arising from the initial recognition of an asset or liability in
a transaction which isn’t a business combination and which affects neither accounting profit nor
taxable income (or deductible losses), the corresponding deferred income tax assets and deferred
income tax liabilities are not recognized. On the balance sheet date, the deferred income tax assets
and deferred income tax liabilities are measured at the tax rate applicable to the period during
which the assets are expected to be recovered or the liabilities are expected to be settled.
The Company recognizes deferred income tax assets to the extent of the taxable income which it
is most likely to obtain and which can be deducted from deductible temporary differences,
deductible losses and tax credits.
34. Leasing
Financing leasing virtually transferred the whole risks and leasing of the compensation related to
the assets ownership and their ownership may eventually be transferred or maybe not. Other
leasing except for the financing leasing is operating leasing.
(1) Business of operating leases recorded by the Company 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.
(2) Business of operating leases recorded by the Company as the lessor
The rent incomes from operating leases shall be recognized as the profits and losses of the current
period by using the straight-line method over each period of the lease term. The initial direct costs
of great amount shall be capitalized when incurred, and be recorded into current profits and losses
in accordance with the same basis for recognition of rent incomes over the whole lease term. The
initial direct costs of small amount shall be recorded into current profits and losses when incurred.
The contingent rents shall be recorded into the profits and losses of the current period in which
193
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
they actually arise.
(3) Business of finance leases recorded by the Company as the lessee
On the lease beginning date, the Company shall record the lower one of the fair value of the
leased asset and the present value of the minimum lease payments on the lease beginning date as
the entering value in an account, recognize the amount of the minimum lease payments as the
entering value in an account of long-term account payable, and treat the balance between the
recorded amount of the leased asset and the long-term account payable as unrecognized financing
charges. Besides, the initial direct costs directly attributable to the leased item incurred during the
process of lease negotiating and signing the leasing agreement shall be recorded in the asset value
of the current period. The balance through deducting unrecognized financing charges from the
minimum lease payments shall be respectively stated in long-term liabilities and long-term
liabilities due within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease
term, so as to calculate and recognize current financing charges. The contingent rents shall be
recorded into the profits and losses of the current period in which they actually arise.
(4) Business of finance leases recorded by the Company as the lessor
On the beginning date of the lease term, the Company 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.
35. Changes in Main Accounting Policies and Estimates
(1) Changes of accounting policies
In 2017, the Ministry of Finance issued the revised "Accounting Standards for Business
Enterprises No. 14-Revenue" (referred to as the "New Revenue Standards"). The Company starts
to implement the above newly revised standards since 1 January 2020. In accordance with the
link up provision, no adjustment was made to information of comparative period, and the
Company retroactively adjusted the retained earnings of period-begin or other comprehensive
income based on the difference between the current standards and the new standards on the first
execution date.
The new revenue standard establishes a new revenue recognition model for regulating revenue
generated from contracts with customers. In order to implement the new revenue standards, the
company reassessed the recognition and measurement, accounting and presentation of main
contract revenue. According to the new revenue standard, the company chooses to adjust only the
cumulative impact of contracts that have not been completed on January 1, 2020, and for contract
changes that occur before the beginning of the earliest comparable period (ie, January 1, 2020)
Simplified processing, that is, according to the final arrangement of the contract change, identify
the fulfilled and unfulfilled performance obligations, determine the transaction price, and allocate
the transaction price between the fulfilled and unfulfilled performance obligations. The
cumulative impact amount of the first implementation adjusts the amount of related items in the
194
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
financial statements at the beginning of the first implementation period (ie 1 January 2020). The
2019 financial statements have not been restated.
(2) Changes in Accounting Estimates
No such cases in the Reporting Period.
(3) Adjustments to the Financial Statements at the Beginning of the First Execution Year of any
New Standards Governing Revenue or Leases since 2020
1）Consolidated balance sheet:
Unit: RMB
Item 31 December 2019 1 January 2020 Adjustment
Current assets:
Accounts receivable 4,416,179,657.87 3,804,339,643.15 -611,840,014.72
Inventories 5,318,503,044.69 5,307,497,440.88 -11,005,603.81
Contract assets 628,566,815.99 628,566,815.99
Other current assets 2,093,212,552.25 2,104,218,156.06 11,005,603.81
Total current assets 25,422,786,872.67 25,439,513,673.94 16,726,801.27
Total assets 42,586,955,452.27 42,603,682,253.54 16,726,801.27
Current liabilities:
Advances from customers 1,076,856,387.08 -1,076,856,387.08
Contract liabilities 959,538,151.80 959,538,151.80
Other payables 2,374,287,243.20 2,281,173,106.78 -93,114,136.42
Other current liabilities 16,726,801.27 16,726,801.27
Total current liabilities 22,145,831,594.58 21,952,126,024.15 -193,705,570.43
Non-current liabilities:
Provisions 206,591.51 93,320,727.93 93,114,136.42
Other non-current liabilities 117,318,235.28 117,318,235.28
Total non-current liabilities 10,514,426,070.89 10,724,858,442.59 210,432,371.70
Total liabilities 32,660,257,665.47 32,676,984,466.74 16,726,801.27
Total liabilities and shareholders’
42,586,955,452.27 42,603,682,253.54 16,726,801.27
equity
2）Balance Sheet of the Company as the Parent
Unit: RMB
Item 31 December 2019 1 January 2020 Item
Current assets:
Accounts receivable 9,564,720,940.39 9,580,894,472.00 16,173,531.61
195
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item 31 December 2019 1 January 2020 Item
Inventories 218,644,308.47 207,949,690.07 -10,694,618.40
Other current assets 1,096,689,897.40 1,107,384,515.80 10,694,618.40
Total current assets 27,118,078,820.83 27,134,252,352.44 16,173,531.61
Non-current assets:
Total non-current assets 9,863,245,391.12 9,863,245,391.12
Total assets 36,981,324,211.95 36,997,497,743.56 16,173,531.61
Current liabilities:
Advances from customers 318,839,961.84 -318,839,961.84
Contract liabilities 269,891,156.62 269,891,156.62
Other payables 3,193,392,734.69 3,181,261,535.24 -12,131,199.45
Other current liabilities 16,173,531.61 16,173,531.61
Total current liabilities 22,481,405,801.52 22,436,499,328.46 -44,906,473.06
Non-current liabilities:
Provisions 206,591.51 12,337,790.96 12,131,199.45
Other non-current liabilities 48,948,805.22 48,948,805.22
Total non-current liabilities 8,507,373,492.54 8,568,453,497.21 61,080,004.67
Total liabilities 30,988,779,294.06 31,004,952,825.67 16,173,531.61
Total liabilities and shareholders’
36,981,324,211.95 36,997,497,743.56 16,173,531.61
equity
The main changes and impacts of the implementation of the new revenue standard on the
Company are as follows:
The Company reclassified the contract consideration received from customers in advance due to
the transfer of goods from the item of "Advances from customers" to the item of "Contract
liabilities" (or other non-current liabilities); Some of the Company's receivables do not meet the
conditions for unconditional (that is, only dependent on the passage of time) to collect
consideration from customers, and the Company reclassifies them as "Contract assets"; The
Company reclassifies the warranty receivables that have not reached the collection period as
"Contract assets"; The Company reclassifies the quality assurance from the item of “Other
payments” to the item of “Provisions”; The Company recognizes the balance of the carrying value
of goods at the time of transfer expected to be returned after deducted estimated cost for
collecting the said goods (including the value impairment of the returned goods) as an asset, that
is the return cost receivable which is presented as “other current assets” for accounting.
196
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
V. Taxation
1. Main Taxes and Tax Rate
Category of taxes Basis Specific situation of the taxes rate
Calculated the output tax at the tax
rate and paid the VAT by the
amount after deducting the
deductible withholding VAT at
VAT 1%、3%、5%、6%、9%、13%
current period, of which the VAT
applicable to easy collection won’t
belong to the deductible
withholding VAT.
Paid at 5%: Dongguan Konka, XingDa
HongYe, Xinfeng Microcrystalline, Boluo
Konka Precision, Boluo Konka, Dongguan
Packing, Ningbo Kanghanrui, Jiangsu Konka
Smart, Shanghai Konka, Chengdu Anren,
Binzhou Beihai Jingmai, Binzhou Econ
Urban maintenance Zhongke, Suining Pengxi Kangrun, Dayi
The circulating tax actually paid
and construction tax Kangrun Water, Lushan Kangrun
Environmental, Funan Kangrun Water, Subei
Kangrun Water, Mengcheng Kangrun,
Tingyuan Environmental. Paid at 7%: Konka
Capital. Paid at 1%: Jiangxi Konka, Nano
Crystallized Glass, Jiangkang (Shanghai)
Technology. Paid at 7%: other subsidiaries.
Education surtax The circulating tax actually paid 3%
The subsidiary Wuhan Runyuan Sewage:
Local education
The circulating tax actually paid 1.5% , Shanghai Konka: 1% and other
surtax
companies: 2%
Enterprise income 25%/2.Tax Preference and Approved
Taxable income
tax Documents
The main taxpayers of different corporate income tax rates are explained as follows:
Name of entity Income tax rate
Electronics Technology, Anhui Konka, Anhui
Tongchuang, Econ Technology, XingDa HongYe,
Wankaida, E2info, Jiangxi Konka, Xinfeng
Microcrystalline, Nano Crystallized Glass, Sichuan 15%
Konka, Boluo Konka Precision, Chongqing
Optoelectronic Research Institute, Chongqing
Kangxingrui
Hong Kong Konka, Konka Electrical Appliances 16.5%
197
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Name of entity Income tax rate
International Trading, Jiali International,
Kangjietong, Jiaxin Technology, Jiaxin Technology,
Konka Electrical Appliances Investment, Konka
SmartTech, Konka Mobility
Chain Kingdom Memory Technologies 8.25%/16.5%
Konka Europe 15%
Kanghao Technology 22.5%
Konka North America 21%
The Company as the Parent and other subsidiaries 25%
Note: According to regulations of Temporary Provisions of Income Tax of Trans-boundary 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 1 January 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 January 2008 and will be final settled uniformly by the
Company at the year-end.
2. Tax Preference and Approved Documents
(1) According to Caishui [2019] No. 13: Notice on the implementation of the inclusive tax
reduction and exemption policy for small and micro enterprises, from 1 January 2019 to 31
December 2021, the annual taxable income of small and profitable enterprises is not The portion
exceeding RMB1 million will be reduced to 25% of the taxable income, and the corporate income
tax will be paid at the rate of 20%; the portion of the annual taxable income exceeding RMB1
million but not exceeding RMB3 million will be reduced by 50% Include the taxable income and
pay corporate income tax at a rate of 20%.
198
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(2) On 28 December 2017, Econ Technology, a subsidiary of the Company, obtained the
High-tech Enterprise Certificate (certificate No.: GR201737001495) jointly issued by Department
of Science and Technology of Shandong Province, Department of Finance of Shandong Province,
Shandong Provincial Office, SAT, Shandong Local Taxation Bureau with a valid period of three
years. According to the relevant tax regulations, Econ Technology enjoys related tax incentives
for high-tech companies for three consecutive years from 2017 to 2019, and is subject to
corporate income tax at a preferential rate of 15%. On 7 December 2020, the Office of the
National High-tech Enterprise Certification and Management Leading Group published its reply
to Shandong Province in respect of the list of the first batch of high-tech enterprises that the
province has filed for record (G.K.H.Z. [2020] No. 216). Econ Technology is included on the list,
with GR202037000258 as its certificate number. The Company estimates that there are no
obstacles in the review of high-tech enterprises. As a certified high-tech enterprise, Econ
Technology is entitled to a preferential corporate income tax rate of 15%.
(3) On 16 October 2018, Shenzhen E2info Network Technology Co., Ltd., the subsidiary of this
Company obtained the high-tech enterprise certificate (certificate No.: GR201844201969) jointly
issued by Shenzhen Technology Innovation Committee, Finance Committee of Shenzhen
Municipality, Shenzhen Taxation Bureau of SAT with a valid period of three years. According to
related taxation regulations, the company enjoys related taxation preferential policies as a
high-tech enterprise from 2018 to 2020 and pays the enterprise income tax as per the preferential
tax rate of 15%.
(4) On 28 November 2018, the Company’s subsidiary XingDa HongYe received the High-tech
Enterprise Certificate (No.GR201844008446 with the 3-year period of validity) jointly issued by
Department of Science and Technology of Guangdong Province, Department of Finance of
Guangdong Province and State Administration of Taxation (Guangdong Provincial Tax Service).
According to relevant tax regulations, from 2018 to 2020, the enterprise shall be eligible for
enjoying relevant preferential tax policies as a new high-tech enterprise and corresponding
corporate income tax shall be paid based on the preferential tax rate of 15%.
(5) On 9 September 2019, Anhui Konka, the subsidiary of the Company, obtained a certificate of
high-tech enterprise jointly issued by Anhui Science and Technology Department, Anhui
Provincial Department of Finance and Anhui Provincial Tax Bureau of the State Administration
of Taxation. The certificate number is GR201934000966 and is valid for three years. According
to relevant tax regulations, Anhui Konka shall enjoy relevant preferential tax policies for
high-tech enterprises for three consecutive years from 2019 to 2021 and pay the enterprise
income tax at a preferential tax rate of 15%.
(6) On 16 September 2019, Xinfeng Microcrystalline, the subsidiary of the Company, obtained a
high-tech enterprise certificate jointly issued by Jiangxi Science and Technology Department,
199
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Jiangxi Provincial Department of Finance and Jiangxi Provincial Tax Bureau of the State
Administration of Taxation. The certificate number is GR201936000744 and is valid for three
years. According to relevant tax regulations, Xinfeng Microcrystalline shall enjoy relevant
preferential tax policies for high-tech enterprises for three consecutive years from 2019 to 2021
and pay the enterprise income tax at a preferential tax rate of 15%.
(7) On 20 November 2019, Anhui Tongchuang, the subsidiary of the Company, obtained a
high-tech enterprise certificate jointly issued by Anhui Science and Technology Department,
Anhui Provincial Department of Finance and Anhui Provincial Tax Bureau of the State
Administration of Taxation. The certificate number is GR201934001964 and is valid for three
years. According to relevant tax regulations, Anhui Tongchuang shall enjoy relevant preferential
tax policies for high-tech enterprises for three consecutive years from 2019 to 2021 and pay the
enterprise income tax at a preferential tax rate of 15%.
(8) On 28 November 2019, Sichuan Konka, a subsidiary of the Company, obtained a certificate of
high-tech enterprise jointly issued by Sichuan Science and Technology Department, Sichuan
Provincial Department of Finance and Sichuan Provincial Tax Bureau of the State Administration
of Taxation. The certificate number is GR201951002096 and is valid for three years. According
to relevant tax regulations, Sichuan Konka shall enjoy relevant preferential tax policies for
high-tech enterprises for three consecutive years from 2019 to 2021 and pay the enterprise
income tax at a preferential tax rate of 15%.
(9) On 2 December 2019, Bokang Precision, a subsidiary of the Company, obtained the high-tech
enterprise certificate jointly issued by the Guangdong Provincial Department of Science and
Technology, the Guangdong Provincial Department of Finance, the Guangdong State Taxation
Bureau, and the Guangdong Local Taxation Bureau. The certificate number is GR201944007820,
valid for three years, according to relevant tax regulations, Bokang Precision has enjoyed relevant
preferential tax policies for high-tech enterprises for three consecutive years from 2019 to 2021,
and is subject to corporate income tax at a preferential tax rate of 15%.
(10) On 9 December 2019, Electronics Technology, the subsidiary of the Company, obtained a
Certificate of High-tech Enterprise jointly issued by Shenzhen Science and Technology
Department, Shenzhen Provincial Department of Finance and Shenzhen Provincial Tax Bureau of
the State Administration of Taxation. The certificate number is GR201944204287 and is valid for
three years. According to relevant tax regulations, Electronics Technology shall enjoy relevant
preferential tax policies for high-tech enterprises for three consecutive years from 2019 to 2021
and pay the enterprise income tax at a preferential tax rate of 15%.
(11) On 14 September 2020, Jiangxi Konka, the subsidiary of the Company, obtained a high-tech
enterprise certificate jointly issued by Jiangxi Science and Technology Department, Jiangxi
200
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provincial Department of Finance and Jiangxi Provincial Tax Bureau of the State Administration
of Taxation. The certificate number is GR202036000802 and is valid for three years. According
to relevant tax regulations, Jiangxi Konka shall enjoy relevant preferential tax policies for
high-tech enterprises for three consecutive years from 2020 to 2022 and pay the enterprise
income tax at a preferential tax rate of 15%.
(12) On 14 September 2020, Nano Crystallized Glass, the subsidiary of the Company, obtained a
high-tech enterprise certificate jointly issued by Jiangxi Science and Technology Department,
Jiangxi Provincial Department of Finance and Jiangxi Provincial Tax Bureau of the State
Administration of Taxation. The certificate number is GR202036000568 and is valid for three
years. According to relevant tax regulations, Nano Crystallized Glass shall enjoy relevant
preferential tax policies for high-tech enterprises for three consecutive years from 2020 to 2022
and pay the enterprise income tax at a preferential tax rate of 15%.
(13) On 25 November 2020, Chongqing Optoelectronic Research Institute, the subsidiary of the
Company, obtained a high-tech enterprise certificate jointly issued by Chongqing Municipal
Science and Technology Bureau, Chongqing Municipal Finance Bureau and Chongqing
Municipal Tax Bureau of the State Administration of Taxation. The certificate number is
GR202051101224 and is valid for three years. According to relevant tax regulations, Chongqing
Optoelectronic Research Institute shall enjoy relevant preferential tax policies for high-tech
enterprises for three consecutive years from 2020 to 2022 and pay the enterprise income tax at a
preferential tax rate of 15%.
(14) On 11 December 2020, Wankaida, the subsidiary of this Company obtained the high-tech
enterprise certificate (certificate No.: GR202044201940) jointly issued by Shenzhen Technology
Innovation Committee, Finance Committee of Shenzhen Municipality, Shenzhen Taxation
Bureau of SAT with a valid period of three years. According to related taxation regulations,
Wankaida enjoys related taxation preferential policies as a high-tech enterprise from 2020 to 2022
and pays the enterprise income tax as per the preferential tax rate of 15%.
(15) In accordance with the Notice on Tax Policy Issues Involved in the Further Implementation
of the Western Development Strategy (C.S. [2011] No. 58) and the Announcement on Corporate
Income Tax Issues Involved in the Further Implementation of the Western Development Strategy
(Announcement [2012] No. 12 by the State Taxation Administration), an enterprise established in
the western region who is mainly engaged in an industry specified in the Catalogue of
Encouraged Industries in the Western Region and whose main business income accounts for over
70% of its gross income in the current year, is entitled to a reduced corporate income tax rate of
15%. Chongqing Kangxingrui, a subsidiary of the Company, is eligible for this preferential tax
policy.
201
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(16) According to the Notice on Issues Concerning the Promotion of Energy-Saving Service
Industry Development VAT Business Tax and Corporate Income Tax Policy Issued by the
Ministry of Finance and the State Administration of Taxation (Caishui [2010] No. 110) For the
income, the enterprise enjoys the "three exemptions and three halves" preferential treatment of
corporate income tax since the tax year in which the first production and operation income of the
project is obtained. Binhai Sewage and Lairun Holdings, subsidiaries of the Company, enjoy this
tax incentive. Binhai Sewage and Lairun Holdings will be exempt from corporate income tax
from 2017 to 2019, and corporate income tax will be levied at half the 25% legal tax rate from
2020 to 2022.
(17) According to the fiscal and taxation document [2011] No. 100 published by the Ministry of
Finance and the State Administration of Taxation, for the VAT general taxpayers who sell their
self-developed and produced software products, the VAT shall be levied at the rate of 13%, and
then the part that the actual tax burden on their VAT exceeds 3 will be implemented with the
policy of immediate withdrawal. The Company’s subsidiaries, Wankaida Technology, Youzhihui
and Electronics Technology all enjoy this preferential policy.
(18) According to the regulations of the Special Catalogue of VAT Concessions for Products and
Labors with Comprehensive Utilization of Resources issued by the Ministry of Finance and the
State Administration of Taxation (Finance and Taxation [2015] No. 78), the wastewater treatment
business operated by Lairun Holdings and Binhai Sewage, subsidiaries of the Company, belongs
to the this catalogue. Then after levied the VAT at the statutory tax rate, it currently carries out
the tax rate of 6% (SAT Announcement [2020] No. 9, the actual tax burden on the wastewater
treatment income tax will be refunded in accordance with the 70% of the actual tax burden, and
the actual tax burden on the renewable water income VAT will be refunded immediately at 50%.
(19) According to the Announcement on the Applicable Policies for the Settlement and Payment
of Corporate Income Tax of Integrated Circuit Design Enterprises and Software Enterprises in
2019 (C.S. [2020] No. 29), integrated circuit design enterprises and software enterprises that are
legally established within the territory of China and meet certain requirements, are entitled to a
period of preferential tax rates starting from the first profitable year before 31 December 2019.
They are exempt from corporate income tax in the first and second years, and for the next three
years till the expiration of this period, the corporate income tax rate is half of the statutory rate of
25%. The Company's subsidiary Youzhihui enjoys the preferential policies, and a 0% income tax
rate is applicable during the reporting period.
202
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
VI. Notes on Major Items in Consolidated Financial Statements of the Company
Unless otherwise noted, the following annotation project (including the main projects，annotation
of the financial statement of the Company), the period-begin refers to 1 January 2020, the
period-end refers to 31 December 2020, this period refers to Y2020 and the last period refers to
the period from 1 January 2019 to 31 December 2019. The monetary unit is Renminbi.
1. Monetary Assets
Item Ending balance Beginning balance
Cash on hand 16,052.88 18,699.99
Bank deposits 4,298,040,060.36 4,493,683,217.23
Other monetary assets 1,133,474,067.66 2,105,658,134.39
Total 5,431,530,180.90 6,599,360,051.61
Of which: total amount deposited
202,052,024.94 378,330,661.32
in overseas
Note: The ending balance of other monetary assets was the deposits of each margin deposit not
withdrawn at any time. Refer to Note VI-64 Assets with restricted ownership or use right for
details.
2. Trading financial assets
Item Ending balance Beginning balance
Financial assets at fair value through profit
618,249,541.66 61,494,666.97
or loss
Of which: debt instrument investment
Equity instrument investment 61,494,666.97
Structural deposits 618,249,541.66
Financial assets at fair value through profit
or loss
Of which: debt instrument investment
Hybrid instrument investment
Total 618,249,541.66 61,494,666.97
3. Notes receivable
(1) Notes Receivable Listed by Category
Item Ending balance Beginning balance
203
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending balance Beginning balance
Commercial acceptance bill 1,012,776,099.43 199,412,421.02
Bank’s acceptance bill 1,345,404,094.53 2,638,629,011.87
Total 2,358,180,193.96 2,838,041,432.89
(2) Notes Receivable Pledged by the Company at the Period-end
Item Amount
Bank’s acceptance bill 784,732,739.73
Total 784,732,739.73
(3) Notes Receivable which Had Endorsed by the Company or had Discounted and had not Due
on the Balance Sheet Date at the Period-end
Item Amount of recognition Amount of not terminated
termination at the recognition at the
period-end period-end
Bank’s acceptance bill 1,281,660,058.38
Commercial acceptance bill 9,137,006.26 432,420,000.00
Total 1,290,797,064.64 432,420,000.00
(4) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the
Contract or Agreement
Item Amount of the notes transferred to
accounts receivable at the period-end
Bank’s acceptance bill 200,000,000.00
Commercial acceptance bill 747,821,940.14
Total 947,821,940.14
Note: At the end of the year, the notes transferred to the accounts receivable mainly due to the
drawer's failure to perform are the overdue notes for the Company's factoring business.
(5) Listed by Withdrawal Methods for Bad Debt Provision
Category Ending balance
204
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Carrying amount Bad debt provision
Withdra
Propo
wal Carrying value
Amount rtion Amount
proporti
(%)
on (%)
Provision for bad
debts provided
individually
Bad debt provision
2,387,417,262.59 100.00 29,237,068.63 1.22 2,358,180,193.96
made as per portfolio
Of which: Bank
1,345,404,094.53 56.35 - 1,345,404,094.53
acceptance bill
Commercial
1,042,013,168.06 43.65 29,237,068.63 2.81 1,012,776,099.43
acceptance bill
Total 2,387,417,262.59 100.00 29,237,068.63 1.22 2,358,180,193.96
(Continued)
Beginning balance
Carrying amount Bad debt provision
Category Withdr
Propo
awal Carrying value
Amount rtion Amount
proport
(%)
ion (%)
Provision for bad
debts provided
individually
Bad debt provision
2,842,347,510.24 100.00 4,306,077.35 0.15 2,838,041,432.89
made as per portfolio
Of which: Bank
2,638,629,011.87 92.83 2,638,629,011.87
acceptance bill
Commercial
203,718,498.37 7.17 4,306,077.35 2.11 199,412,421.02
acceptance bill
Total 2,842,347,510.24 100.00 4,306,077.35 0.15 2,838,041,432.89
205
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
1) In the group, notes receivable, for which the provision for expected credit loss was made
according to trade acceptance
Ending balance
Name Bad debt Withdrawal
Carrying amount
provision proportion (%)
Within 1 year 1,042,013,168.06 29,237,068.63 2.81
Total 1,042,013,168.06 29,237,068.63 2.81
(6) Bad debt provision for notes receivable withdrawn, collected or reversed during the Reporting
Period
Changed amount
Beginning Withdrawal Collecte
Category Write-off Ending balance
balance d or
or verified
reversed
Commercial
4,306,077.35 24,930,991.28 29,237,068.63
acceptance bill
Total 4,306,077.35 24,930,991.28 29,237,068.63
(7) There is no notes receivable actually written off in the current year.
There is no notes receivable actually written off in the current year.
4. Accounts Receivable
(1) Listed by Withdrawal Methods for Expected Credit Loss
Ending balance
Carrying amount Bad debt provision
Category Withdr
Proport awal Carrying value
Amount Amount
ion (%) proport
ion (%)
Accounts receivable,
for which the
1,384,462,893.38 27.50 750,096,749.22 54.18 634,366,144.16
independent provision
for expected credit
206
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Carrying amount Bad debt provision
Category Withdr
Proport awal Carrying value
Amount Amount
ion (%) proport
ion (%)
losses
Accounts receivable,
for which the provision
for expected credit
losses was withdrawn
according to groups
Of which: aging group 3,004,054,396.28 59.66 271,291,702.62 9.03 2,732,762,693.66
Project payment
646,556,634.10 12.84 112,787,848.33 17.44 533,768,785.77
group
Subtotal of groups 3,650,611,030.38 72.50 384,079,550.95 10.52 3,266,531,479.43
Total 5,035,073,923.76 100.00 1,134,176,300.17 22.53 3,900,897,623.59
(Continued)
Beginning balance
Carrying amount Bad debt provision
Category Withdr
Proport awal Carrying value
Amount Amount
ion (%) proport
ion (%)
Accounts receivable,
for which the
independent provision 1,093,505,612.71 24.31 384,089,197.98 35.12 709,416,414.73
for expected credit
losses
Accounts receivable,
for which the provision
for expected credit
losses was withdrawn
207
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance
Carrying amount Bad debt provision
Category Withdr
Proport awal Carrying value
Amount Amount
ion (%) proport
ion (%)
according to groups
Of which: aging group 2,820,178,866.87 62.69 236,910,263.28 8.40 2,583,268,603.59
Project payment
584,680,503.88 13.00 73,025,879.05 12.49 511,654,624.83
group
Subtotal of groups 3,404,859,370.75 75.69 309,936,142.33 9.10 3,094,923,228.42
Total 4,498,364,983.46 100.00 694,025,340.31 15.43 3,804,339,643.15
1) Accounts receivable, for which, the independent provision for expected credit loss is made at
the period-end
Ending balance
Withdr
Name Carrying Bad debt awal
Withdrawal reason
amount provision proport
ion (%)
Shanghai Huaxin International
300,018,021.01 240,014,416.81 80.00 Debt default
Group Co., Ltd
Tewoo Finance Company
200,000,000.00 90,000,000.00 45.00 Judicial reorganization
Limited
Hongtu Sanbao High-tech Agreement
200,000,000.00 80,000,000.00 40.00
Technology Co., Ltd. reorganization
China Nuclear Engineering
74,582,619.13 22,374,785.74 30.00 Increased credit risk
Construction Group Co., Ltd
No.1 Engineering Company
Expected to be difficult
Limited of CCCC First Harbor 65,221,300.00 58,699,170.00 90.00
Engineering Company Limited to recover in full
China Energy Electric Fuel Co., Expected to be difficult
50,000,000.00 40,000,000.00 80.00
Ltd to recover in full
Tahoe Group Co. Ltd 50,000,000.00 20,000,000.00 40.00 Debt reorganization
Empire Electronic Corp 42,472,943.03 42,472,943.03 100.00 Long-term collection and
208
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Withdr
Name Carrying Bad debt awal
Withdrawal reason
amount provision proport
ion (%)
cannot be recovered
The counterparty is
H-BUSTER DO BRASIL bankrupt and is expected
17,945,518.46 17,945,518.46 100.00
INDUSTRIA to be difficult to recover
in full
Expected to be difficult
Treeview Business Registration 11,648,757.09 11,648,757.09 100.00
to recover in full
Expected to be difficult
Others 372,573,734.66 126,941,158.09 34.07
to recover in full
Total 1,384,462,893.38 750,096,749.22 54.18
2) Accounts receivable, for which the provision for expected credit losses was withdrawn
according to groups
① In the group, accounts receivable, for which, the provision for expected credit loss was made
according to aging groups
Ending balance
Withdrawal
Aging
Carrying amount Bad debt provision proportion
(%)
Within 1 year 2,367,338,511.72 48,308,043.50 2.04
1 to 2 years 398,076,018.92 39,887,371.88 10.02
2-3 years 70,778,770.88 16,059,703.12 22.69
3-4 years 2,347,695.43 1,523,184.79 64.88
Over 4 years 165,513,399.33 165,513,399.33 100.00
Total 3,004,054,396.28 271,291,702.62 9.03
② In the group, accounts receivable, for which, the provision for expected credit loss was made
according to project payment groups
209
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Withdrawal
Aging
Carrying amount Bad debt provision proportion
(%)
Within 1 year 260,870,171.57 13,043,508.53 5.00
1 to 2 years 205,103,789.51 20,510,378.97 10.00
2-3 years 88,692,660.55 26,607,798.16 30.00
3-4 years 78,263,538.63 39,131,769.32 50.00
Over 4 years 13,626,473.84 13,494,393.35 99.03
Total 646,556,634.10 112,787,848.33 17.44
(2) Accounts Receivable Listed by Aging
Aging Ending balance
Within 1 year 2,630,187,591.95
1 to 2 years 1,209,886,791.32
2-3 years 843,078,575.90
3-4 years 132,412,306.63
Over 4 years 219,508,657.96
Subtotal 5,035,073,923.76
Less: provision for bad debts 1,134,176,300.17
Total 3,900,897,623.59
(3) Bad debt provision for accounts receivable during the Reporting Period
Changed amount
Writ
Beginning Collec
Category e-off Ending balance
balance ted or Decrease for
Withdrawal or
revers other reasons
verif
ed
ied
Bad debt
provision of
694,025,340.31 444,069,685.68 3,918,725.82 1,134,176,300.17
accounts
receivable
Total 694,025,340.31 444,069,685.68 3,918,725.82 1,134,176,300.17
(4) Accounts receivable actually verified during the Reporting Period
210
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
There were no accounts receivable actually verified during the Reporting Period
(5) Top 5 of the Ending Balance of the Accounts Receivable Collected according to the Arrears
Party
The total amount of top five of account receivable of ending balance collected by arrears party
was RMB 1,149,826,053.99, accounting for 22.84% of total closing balance of account receivable,
the relevant ending balance of bad debt provision withdrawn was RMB421,959,487.71.
(6) There was no accounts receivable derecognized for transfer of financial assets.
(7) There is no amount of assets and liabilities formed due to the transfer of accounts receivable
and continued involvement in this year.
5. Accounts Receivable Financing
Item Ending balance Beginning balance
Notes Receivable 84,057,197.44 143,174,271.82
Total 84,057,197.44 143,174,271.82
Note: Accounts receivable financing is the bank acceptances of higher credit rating held by the
Company, which aim at both collecting contract cash and selling the financial assets themselves.
6. Prepayments
(1) Age of advances to suppliers
Ending balance Beginning balance
Item Amount Proportion Amount Proportion
(%) (%)
Within 1 year 1,166,762,930.75 98.60 2,059,939,470.32 99.39
1 to 2 years 14,282,024.18 1.21 8,056,998.90 0.39
2-3 years 733,390.33 0.06 4,074,992.31 0.20
Over 3 years 1,492,198.15 0.13 479,350.33 0.02
Total 1,183,270,543.41 100.00 2,072,550,811.86 100.00
Note: The amount of prepayments aged over one year at the end of the period is RMB
211
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
16,507,612.66, accounting for 1.40% of the total balance of prepayments of the Company, and
consists mainly of payments for goods afloat or unsettled payments.
(2) Advances to suppliers from top five prepaid parties classified based on the ending balance
The sum total of prepayments with top five ending balance collected as per the prepaid party is
RMB 656,765,428.07, and the proportion in total ending balance of payments is 55.50%.
7. Other receivables
Item Ending balance Beginning balance
Interest receivable 45,109,425.85 7,807,400.40
Dividends receivable 4,947,848.62 547,848.62
Other Receivables 2,095,679,366.13 1,763,828,117.47
Total 2,145,736,640.60 1,772,183,366.49
7.1 Interest receivable
Item Ending balance Beginning balance
Fix time deposit 10,235,673.76 4,807,630.04
Entrusted loans 34,303,196.21 2,623,723.82
Factoring income 570,555.88 376,046.54
Total 45,109,425.85 7,807,400.40
7.2 Dividends receivable
Investee Ending balance Beginning balance
Chongqing Qingjia Electronic Co.,
547,848.62 547,848.62
Ltd.
Binzhou Beihai Weiqiao Solid Waste
4,400,000.00
Treatment Co., Ltd.
Total 4,947,848.62 547,848.62
7.3 Other receivables
(1) Classified by Account Nature
Item Ending balance Beginning balance
212
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Deposit,Deposit, Deposit 1,642,180,460.58 1,307,226,302.83
Intercourse funds among minority
shareholders in the business
consolidation not under the same 176,427,511.36 178,968,748.99
control and related parties
Energy-saving subsidies 152,399,342.00 152,402,680.00
Disposal of non-current assets 132,331,700.00 147,256,700.00
Others 638,804,307.66 376,824,887.60
Total 2,742,143,321.60 2,162,679,319.42
Note: The increase in other receivables was mainly due to the increase in the company's prepaid
deposits, security deposits and deposits
(2) Withdrawal of Bad Debt Provision
Phase I Phase II Phase III
Expected
Expected credit
Expected credit losses
losses for the
Bad debt provision credit losses for the entire Total
entire duration
over the next duration (no
(with credit
12 months credit
impairment)
impairment)
Balance as at 1 January
15,229,049.09 25,449,941.31 358,172,211.55 398,851,201.95
2020
In the Reporting Period,
Carrying amount of other
receivables on 1 January
2020:
——Transferred to the
-5,051,195.62 5,051,195.62
Phase II
——Transferred to the
-610.58 -4,636,617.84 4,637,228.42
Phase III
——Transferred back to
the Phase II
——Transferred back to
the Phase I
213
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Phase I Phase II Phase III
Expected
Expected credit
Expected credit losses
losses for the
Bad debt provision credit losses for the entire Total
entire duration
over the next duration (no
(with credit
12 months credit
impairment)
impairment)
Provision made in the
9,478,513.76 34,375,867.10 214,401,463.63 258,255,844.49
current year
Amount transferred back
in the current year
Write-off
Verification 153,528.90 13,396,856.82 13,550,385.72
Other changes 2,907,294.75 2,907,294.75
Balance as at December
22,563,051.40 60,086,857.29 563,814,046.78 646,463,955.47
31, 2020
Note: The first stage is that credit risk has not increased significantly since initial recognition. For
other receivables with an aging portfolio and a low-risk portfolio within 1 year, the loss provision
is measured according to the expected credit losses in the next 12 months.
The second stage is that credit risk has increased significantly since initial recognition but credit
impairment has not yet occurred. For other receivables with an aging portfolio and a low-risk
portfolio that exceed 1 year, the loss provision is measured based on the expected credit losses for
the entire duration.
The third stage is the credit impairment after initial confirmation. For other receivables of credit
impairment that have occurred, the loss provision is measured according to the credit losses that
have occurred throughout the duration.
(3) Withdrawing bad debt provision for other receivables according to group
Ending balance
Carrying amount Bad debt provision
With
Category Propo draw Carrying value
Amount rtion Amount al
(%) propo
rtion
214
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Carrying amount Bad debt provision
With
Category Propo draw Carrying value
Amount rtion Amount al
(%) propo
rtion
Other receivables
with significant
individual amount
and make 1,177,068,758.61 42.93 563,814,046.78 47.90 613,254,711.83
independent
provision for
expected credit loss
Other receivables
withdrawn bad debt
provision according
to credit risks
characteristics
Aging group 1,327,676,325.32 48.42 73,662,861.99 5.55 1,254,013,463.33
Low-risk group 237,398,237.67 8.66 8,987,046.70 3.79 228,411,190.97
Subtotal of groups 1,565,074,562.99 57.07 82,649,908.69 5.28 1,482,424,654.30
Total 2,742,143,321.60 100.00 646,463,955.47 23.58 2,095,679,366.13
(Continued)
Beginning balance
Carrying amount Bad debt provision
Category Withdr
Propo Carrying value
awal
Amount rtion Amount
propor
(%)
tion
Other receivables
with significant
individual amount
and make
1,093,025,247.42 50.54 358,172,211.55 32.77 734,853,035.87
independent
provision for
expected credit
loss
Other receivables
withdrawn bad
debt provision
according to credit
risks
characteristics
215
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Aging group 598,266,705.02 27.66 30,392,763.59 5.08 567,873,941.43
Low-risk group 471,387,366.98 21.80 10,286,226.81 2.18 461,101,140.17
Subtotal of groups 1,069,654,072.00 49.46 40,678,990.40 3.80 1,028,975,081.60
Total 2,162,679,319.42 100.00 398,851,201.95 18.44 1,763,828,117.47
(4) Listed by aging
Aging Ending balance
Within 1 year 1,195,007,839.77
1 to 2 years 1,242,762,406.26
2-3 years 88,143,690.71
3-4 years 3,044,773.36
4-5 years 5,250,275.90
Over 5 years 207,934,335.60
Subtotal 2,742,143,321.60
Less: bad debt provision 646,463,955.47
Total 2,095,679,366.13
(5) Bad Debt Provision for Other Receivables
The amount of bad debt provision for this year was RMB258,255,844.49, which was mainly due
to the abnormal operation of the supplier of the subsidiary Konka Huanjia, which could not be
delivered normally or refunded the prepaid deposit in the short term. Withdrawal of expected
credit losses; the amount increased for reclassification was RMB2,958,848.86, which was
reduced by RMB32,134.35 due to loss of control of the subsidiary, reduced by RMB424.88 due to
combination and reduced by RMB18,994.88 due to exchange rate changes. Other receivables
actually written off in the current period are RMB13,550,385.72.
(6) Top 5 Other Receivables in Ending Balance Collected according to the Arrears Party
The total amount of top five of account receivable of ending balance collected by arrears party
was RMB1,073,172,589.0, accounting for 39.14% of total closing balance of other receivables,
the relevant ending balance of bad debt provision withdrawn was RMB177,635,416.69.
(7) There were no other receivables derecognized due to transfer of financial assets during the
Reporting Period.
216
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(8) There were no assets and liabilities formed by transferring other receivables and continuing to
be involved in this period.
8. Inventories
(1) Category of Inventory
Ending balance
Inventory falling
price reserves /
Item
Carrying amount impairment Carrying value
provision of contract
performance costs
Raw materials 1,239,024,415.74 28,137,287.12 1,210,887,128.62
Consigned
processing 7,697,008.23 7,697,008.23
materials
Semi-finished
158,870,091.24 12,636,819.92 146,233,271.32
product
Inventory goods 3,389,343,445.93 249,362,200.01 3,139,981,245.92
Contract
performance 16,502,023.32 16,502,023.32
costs
Total 4,811,436,984.46 290,136,307.05 4,521,300,677.41
(Continued)
Beginning balance
Inventory falling
price reserves /
Item
Carrying amount impairment Carrying value
provision of contract
performance costs
Raw materials 1,275,228,321.83 27,122,457.46 1,248,105,864.37
Consigned
processing 3,117,408.28 3,117,408.28
materials
Semi-finished
85,821,719.87 12,822,030.37 72,999,689.50
product
Inventory
4,176,189,636.39 206,509,288.73 3,969,680,347.66
goods
217
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance
Inventory falling
price reserves /
Item
Carrying amount impairment Carrying value
provision of contract
performance costs
Contract
performance 13,594,131.07 13,594,131.07
costs
Total 5,553,951,217.44 246,453,776.56 5,307,497,440.88
(2) Inventory falling price reserves and impairment provision of contract performance costs
Increased Decreased
Decrease by
Beginning losing Ending
Item
balance Withdrawal Write-off controlling balance
right/other
reasons
Raw
27,122,457.46 10,779,703.98 9,757,538.73 7,335.59 28,137,287.12
materials
Goods in
12,822,030.37 931,646.86 1,116,857.31 12,636,819.92
process
Inventory
206,509,288.73 161,101,275.37 117,810,721.29 437,642.80 249,362,200.01
goods
Total 246,453,776.56 172,812,626.21 128,685,117.33 444,978.39 290,136,307.05
（3） Withdrawal Provision Basis of the Falling Price of the Inventory and the Reasons of the
Reversed or Write-off.
Specific basis of withdrawal of falling
Item Reasons for write-off
price reserves of inventory
The realizable net value was lower than the
Raw materials Sold or disposed in the current period
carrying value
Semi-finished The realizable net value was lower than the
Sold or disposed in the current period
product carrying value
Inventory The realizable net value was lower than the
Sold in the current period
goods carrying value
218
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
9. Contractual assets
(1) Details of contractual assets
Ending balance
Item Carrying amount Impairment Carrying value
provision
Accounts receivable from
settled but conditional 3,002,127,112.18 180,488,971.89 2,821,638,140.29
payment projects
Unsettled advertising
49,375,837.18 1,007,267.08 48,368,570.10
payments
Total 3,051,502,949.36 181,496,238.97 2,870,006,710.39
(Continued)
Beginning balance
Item Carrying amount Impairment Carrying value
provision
Accounts receivable from
settled but conditional 649,732,956.12 34,414,475.87 615,318,480.25
payment projects
Unsettled advertising
13,522,835.74 274,500.00 13,248,335.74
payments
Total 663,255,791.86 34,688,975.87 628,566,815.99
(2) Amount and reason of significant change in the book value of the contractual assets in the
current year
Item Amount changed Causes of the Change
Accounts receivable from settled
2,206,319,660.04 New engineering projects
but conditional payment projects
Total 2,206,319,660.04
(3) Making for impairment provision of contractual assets in the current year
219
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Write-of
Amount f/Verifica
Provision made
transferred back tion in
Item in the current Reasons
in the current the
year
year current
year
The expected
credit loss is
greater than the
Accounts receivable 146,074,496.02 book value of the
from settled but current contract
conditional payment asset impairment
projects provision
The expected
credit loss is
greater than the
732,767.08 book value of the
Unsettled current contract
advertising asset impairment
payments provision
Total 146,807,263.10
10. Current Portion of Non-current Assets
Item Ending balance Beginning balance Nature
Current portion of Entrusted loans for
75,000,000.00 60,000,000.00
debt investment associated enterprises
Current portion of Finance leasing
37,310,158.82 48,087,016.22
long-term receivable amount
Total 112,310,158.82 108,087,016.22
(1) Significant debt investment/other debt investment at the year end
Ending balance
Debt investment in Coupon Actual
Par value Expiry Date
rate rate
220
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Debt investment in Coupon Actual
Par value Expiry Date
rate rate
Yibin OCT Sanjiang Real estate 35,000,000.00 2021/4/24
Co. Ltd. 5.70% 5.70%
Yibin OCT Sanjiang Real estate 40,000,000.00 2021/10/24
Co. Ltd. 5.70% 5.70%
Total 75,000,000.00
(Continued)
Beginning balance
Debt investment in Coupon Actual Expiry
Par value
rate rate Date
Yibin OCT Sanjiang Real estate 60,000,000.00 2020/4/24
Co. Ltd. 5.70% 5.70%
Total 60,000,000.00
11. Other Current Assets
Item Ending balance Beginning balance
Prepayments and deductible taxes, and
926,643,711.18 598,034,887.02
refund of tax for export receivable
Principal of entrusted loans to joint ventures 826,684,400.00 1,323,295,500.40
Temporary difference of input tax 148,183,307.23 134,571,124.94
Receivables from sales returns net of cost 7,458,293.85 11,005,603.81
Others 4,176,771.13 37,311,039.89
Total 1,913,146,483.39 2,104,218,156.06
12. Long-term Receivables
(1) List of Long-term Receivables
Ending balance
Item Bad debt
Carrying amount Carrying value
provision
Finance leasing amount 44,609,921.40 44,609,921.40
Of which: unrealized financing
2,526,836.56 2,526,836.56
income
221
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Item Bad debt
Carrying amount Carrying value
provision
Cash deposits of long-term
41,090,400.00 41,090,400.00
receivables
Long-term receivables of
351,107,041.45 351,107,041.45
projects with franchise tights
Less: Current portion of
long-term receivable 37,310,158.82 37,310,158.82
See Note VI. 10 for details)
Total 399,497,204.03 399,497,204.03
(Continued)
Beginning balance
Item Bad debt
Carrying amount Carrying value
provision
Finance leasing amount 77,783,250.17 77,783,250.17
Of which: unrealized financing
9,635,891.82 9,635,891.82
income
Cash deposits of long-term
28,951,495.81 28,951,495.81
receivables
Long-term receivables of
351,861,826.09 351,861,826.09
projects with franchise tights
Less: Current portion of
long-term receivable 48,087,016.22 48,087,016.22
See Note VI. 10 for details)
Total 410,509,555.85 410,509,555.85
(2) List of Projects with Franchise Rights
Date of Operatio
Item Type Project scale Franchise rights
contract n
PPP Project
of water
Partial
supply and Right of charge for
PPP 452,802,100.00 July 2016 trial
sewage sewage disposal
operation
Rushan
Silver Beach
(3) Changes in Long-term Receivables of Projects with Franchise Rights
Item Initial invested Beginning Decreased Ending balance
222
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
amount balance Principal Other
recover decrease
PPP Project of water
supply and sewage 351,107,041.45 351,861,826.09 754,784.64 351,107,041.45
Rushan Silver Beach
Total 351,107,041.45 351,861,826.09 754,784.64 351,107,041.45
223
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
13. Long-term Equity Investment
Change in the Current Period
Adjustment
Investee Beginning balance Gain/loss
Investment Cost method to to other
New investment recognized at
reduced equity method comprehensiv
equity method
e income
Konka Ventures Development
2,354,141.80 -103,551.80
(Shenzhen) Co., Ltd.
Nanjing Zhihuiguang Information
1,446,968.41 126,862.82
Technology Research Institute Co., Ltd.
Feide Technology (Shenzhen) Co., Ltd. 14,314,621.68 -3,642,635.23
Shenzhen Kangyue Industrial Co., Ltd. 33,856,942.00 -709,987.58
Foshan Pearl River Media Creative Park
4,900,000.00
Cultural Development Co., Ltd.
Shenzhen Konka Cross-Border
Technological Innovation Service Co., 19,020.00
Ltd.
Chengdu Konka Incubator Management
254,670.00
Co., Ltd.
Dongguan Konka Smart Electronic
14,700,000.00 1,472,903.60
Technology Co., Ltd.
Puchuang Jiakang Technology Co., Ltd. 400,000.00 999,457.69
Guoguang Ruilian (Shenzhen) Network
192,323.20 -140,359.11
Technology Co., Ltd.
224
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Adjustment
Investee Beginning balance Gain/loss
Investment Cost method to to other
New investment recognized at
reduced equity method comprehensiv
equity method
e income
Khorgos Yilingfang Information
1,795.48
Technology Co., Ltd.
Chongqing Qingjia Electronic Co., Ltd. 19,168,701.08 -367,047.24
Shenzhen Jielunte Technology Co., Ltd. 85,665,123.77 3,522,781.63
Panxu Intelligence Co., Ltd. 51,084,991.78 -1,867,032.63 1,486,737.16
Beijing Konka Jingyuan Technology Co.,
763,492.84 2,798.13
Ltd.
Dongfang Jiahui (Zhuhai) Asset
2,978,676.27 49,295.23
Management Co., Ltd.
Orient Konka no.1 (zhuhai) private
equity investment fund (limited 310,024,401.51 76,183,020.50 100,905,698.76 50,868,896.59
partnership)
Tongxiang Wuzhen Kunyu Equity
- 3,500,000.00 -
Investment Co., Ltd.
Shenzhen Xiaorui Technology Co., Ltd. 88,000,000.00 -9,884,863.61
Weihai Water Environmental Protection
2,493,211.96 33,271.19
Technology Co., Ltd.
Weihai Yiheng Environmental
4,668,292.89 144,337.36
Technology Co., Ltd.
Huoqiu Kangrun Kaitian Water 32,434,987.50 20,000,000.00 -
225
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Adjustment
Investee Beginning balance Gain/loss
Investment Cost method to to other
New investment recognized at
reduced equity method comprehensiv
equity method
e income
Environmental Protection Co., Ltd.
Huarun Environmental Protection Water
16,018,870.31 1,297,571.97
Treatment Co., Ltd.
Binzhou Beihai Weiqiao Solid Waste
133,633,089.95 63,732,938.30
Treatment Co., Ltd.
Shandong Bishuiyuan Environmental
26,174,621.66 215,816.32
Technology Co., Ltd.
Yunnan Hongkang Solid Waste Disposal
2,880,000.00 -70,224.87
Utilization Co., Ltd.
Shandong Konka Zhijia Electrical
4,052,660.23 -1,904,596.76
Appliances Co., Ltd.
Henan Konka Zhijia Electrical
709,634.82 918,000.00 -568,497.48
Appliances Co., Ltd.
Anhui Kaikaishijie E-commerce Co.,
424,850,308.67 -5,785,276.34
Ltd.
Wanjun Technology (Kunshan) Co., Ltd. 182,413,766.51 -7,209,123.66
Kunshan Kangsheng Investment
269,673,264.00 -
Development Co., Ltd.
Chutianlong Co., Ltd. 636,061,636.70 23,385,170.32
Heilongjiang Longkang Zhijia 2,380,000.00 -1,319,274.21
226
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Adjustment
Investee Beginning balance Gain/loss
Investment Cost method to to other
New investment recognized at
reduced equity method comprehensiv
equity method
e income
Technology Co., Ltd.
Konka Green, Konka Technology 77,342,419.36 -2,081,114.80
Shaanxi Silu Yunqi Smart Technology
17,202,315.43 446,980.38
Co., Ltd.
Shenzhen Konka Information Network
Co., Ltd.
Shenzhen Zhongbing Konka Technology
7,273,228.41 -5,058,921.08
Co., Ltd.
Shenzhen Konka Smart Electrical
2,882,149.72 1,091,237.23
Appliance Technology Co., Ltd.
Zhuhai Jinsu Plastic Co., Ltd. 10,166,404.14 - 10,549,865.19 - 383,461.05
Shenzhen Fusheng New Material Co.,
73,600,000.00 -1,884,086.91
Ltd.
Shenzhen Yaode Technology Co., Ltd. 229,740,245.47 -10,382,472.71
Wuhan Tianyuan Environmental
275,577,332.21 29,076,911.48
Protection Co., Ltd.
Shenzhen Konka Yishijie Commercial
84,273,594.93 -2,317,736.66
Display Co., Ltd.
Chuzhou Konka Technology Industry
61,029,500.00 -11,371,102.98
Development Co., Ltd.
227
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Adjustment
Investee Beginning balance Gain/loss
Investment Cost method to to other
New investment recognized at
reduced equity method comprehensiv
equity method
e income
Chuzhou Kangjin Healthcare Industry
117,460,056.00 662,742.37
Development Co., Ltd.
Haimen Kangjian Technology Industrial
Park Operation and Management Co., 131,273,550.00 -10,544,214.33
Ltd.
Nanjing Kangxing Technology Industrial
Park Operation and Management Co., 32,305,671.68 32,305,671.68 -
Ltd.
Chuzhou Kangxin Healthcare Industry
187,180,000.00
Development Co., Ltd.
Dongguan Konka Investment Co., Ltd. 563,500,000.00
Chongqing Konka Real Estate
49,500,000.00
Development Co., Ltd.
Chongqing Chengda Real Estate Co.,
29,205,000.00
Ltd.
Yilifang (Hainan) Technology Co., Ltd. 53,372,944.09 5,342,734.88
Shenzhen Morsemi Technology Co., Ltd. 3,000,000.00 -276,313.64
Total 3,465,541,196.89 123,481,020.50 143,761,235.63 886,031,634.09 105,369,530.39 1,486,737.16
(Continued)
228
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Closing balance
Investee Cash dividend or Ending balance of impairment
Impairment
Other equity changes profit distribution Others provision
allowance
declared
Konka Ventures Development
2,250,590.00
(Shenzhen) Co., Ltd.
Nanjing Zhihuiguang Information
1,573,831.23
Technology Research Institute Co., Ltd.
Feide Technology (Shenzhen) Co., Ltd. 10,671,986.45
Shenzhen Kangyue Industrial Co., Ltd. 33,146,954.42
Foshan Pearl River Media Creative Park
4,900,000.00
Cultural Development Co., Ltd.
Shenzhen Konka Cross-Border
Technological Innovation Service Co., 19,020.00
Ltd.
Chengdu Konka Incubator Management
254,670.00
Co., Ltd.
Dongguan Konka Smart Electronic
16,172,903.60
Technology Co., Ltd.
Puchuang Jiakang Technology Co., Ltd. 1,399,457.69
Guoguang Ruilian (Shenzhen) Network
51,964.09 51,964.09
Technology Co., Ltd.
Khorgos Yilingfang Information
1,795.48
Technology Co., Ltd.
Chongqing Qingjia Electronic Co., Ltd. 18,801,653.84
229
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Closing balance
Investee Cash dividend or Ending balance of impairment
Impairment
Other equity changes profit distribution Others provision
allowance
declared
Shenzhen Jielunte Technology Co., Ltd. 89,187,905.40
Panxu Intelligence Co., Ltd. 50,704,696.31
Beijing Konka Jingyuan Technology Co.,
766,290.97
Ltd.
Dongfang Jiahui (Zhuhai) Asset
3,027,971.50
Management Co., Ltd.
Orient Konka no.1 (zhuhai) private
equity investment fund (limited 336,170,619.84
partnership)
Tongxiang Wuzhen Kunyu Equity
3,500,000.00
Investment Co., Ltd.
Shenzhen Xiaorui Technology Co., Ltd. 25,007,421.57 53,107,714.82 33,684,243.40
Weihai Water Environmental Protection
2,526,483.15
Technology Co., Ltd.
Weihai Yiheng Environmental
4,812,630.25
Technology Co., Ltd.
Huoqiu Kangrun Kaitian Water
52,434,987.50
Environmental Protection Co., Ltd.
Huarun Environmental Protection Water
17,316,442.28
Treatment Co., Ltd.
Binzhou Beihai Weiqiao Solid Waste 14,700,000.00 182,666,028.25
230
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Closing balance
Investee Cash dividend or Ending balance of impairment
Impairment
Other equity changes profit distribution Others provision
allowance
declared
Treatment Co., Ltd.
Shandong Bishuiyuan Environmental
26,390,437.98
Technology Co., Ltd.
Yunnan Hongkang Solid Waste Disposal
2,809,775.13
Utilization Co., Ltd.
Shandong Konka Zhijia Electrical
2,148,063.47
Appliances Co., Ltd.
Henan Konka Zhijia Electrical
1,059,137.34
Appliances Co., Ltd.
Anhui Kaikaishijie E-commerce Co.,
419,065,032.33
Ltd.
Wanjun Technology (Kunshan) Co., Ltd. 175,204,642.85
Kunshan Kangsheng Investment
269,673,264.00
Development Co., Ltd.
Chutianlong Co., Ltd. 9,240,000.00 650,206,807.02
Heilongjiang Longkang Zhijia
1,060,725.79 2,470,398.03
Technology Co., Ltd.
Konka Green, Konka Technology 75,261,304.56
Shaanxi Silu Yunqi Smart Technology
17,649,295.81
Co., Ltd.
Shenzhen Konka Information Network 12,660,222.73
231
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Closing balance
Investee Cash dividend or Ending balance of impairment
Impairment
Other equity changes profit distribution Others provision
allowance
declared
Co., Ltd.
Shenzhen Zhongbing Konka Technology
2,214,307.33
Co., Ltd.
Shenzhen Konka Smart Electrical
3,973,386.95
Appliance Technology Co., Ltd.
Zhuhai Jinsu Plastic Co., Ltd.
Shenzhen Fusheng New Material Co.,
13,315,913.09 58,400,000.00 18,536,771.07
Ltd.
Shenzhen Yaode Technology Co., Ltd. 219,357,772.76
Wuhan Tianyuan Environmental
304,654,243.69
Protection Co., Ltd.
Shenzhen Konka Yishijie Commercial
81,955,858.27
Display Co., Ltd.
Chuzhou Konka Technology Industry
49,658,397.02
Development Co., Ltd.
Chuzhou Kangjin Healthcare Industry
118,122,798.37
Development Co., Ltd.
Haimen Kangjian Technology Industrial
Park Operation and Management Co., 120,729,335.67
Ltd.
Nanjing Kangxing Technology Industrial
232
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Change in the Current Period
Closing balance
Investee Cash dividend or Ending balance of impairment
Impairment
Other equity changes profit distribution Others provision
allowance
declared
Park Operation and Management Co.,
Ltd.
Chuzhou Kangxin Healthcare Industry
187,180,000.00
Development Co., Ltd.
Dongguan Konka Investment Co., Ltd. 563,500,000.00
Chongqing Konka Real Estate
49,500,000.00
Development Co., Ltd.
Chongqing Chengda Real Estate Co.,
29,205,000.00
Ltd.
Yilifang (Hainan) Technology Co., Ltd. 58,715,678.97
Shenzhen Morsemi Technology Co., Ltd. 2,723,686.36
Total 23,940,000.00 38,375,298.75 4,375,833,584.65 67,403,599.32
233
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
14. Other Equity Instrument Investment
(1) Investment in non-trading equity instruments
Beginning
Item Ending balance
balance
Shenzhen Tianyilian Science & Technology Co.,
Ltd.
Shenzhen Adopt Network Co., Ltd.
Beijing Konka Technology Co., Ltd. 1,200,000.00
AVO 5,901,121.80 6,000,000.00
Shaoyang Haishang Ecological Agricultural
1,501,956.00 1,501,956.00
Technology Co., Ltd.
Feihong Electronics Co., Ltd.
ZAEFI
Shenzhen Chuangce Investment Development Co.,
Ltd.
Shanlian Information Technology Engineering
1,860,809.20 1,860,809.20
Center
Shenzhen CIU Science & Technology Co., Ltd. 953,000.00 953,000.00
Shenzhen Digital TV National Engineering
7,726,405.16 7,726,405.16
Laboratory Co., Ltd.
Shanghai National Engineering Research Center of
2,400,000.00 2,400,000.00
Digital TV Co., Ltd.
Bohu UHD 5,000,001.00
Total 25,343,293.16 21,642,170.36
(2) Non-transactional Equity Instrument Investment
234
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reason for
Amount of being Reason for
Dividend
retained designated to be retained
income
Accum earnings measured at fair earnings
recognized Accumulative
Item ulative transferred value of which transferred
in the loss
gain from other recorded in from other
current
comprehensive other comprehen
period
income comprehensive sive income
income
Shenzhen
Long-term
Tianyilian Science
4,800,000.00 holding based on
& Technology Co.,
strategic purpose
Ltd.
Long-term
Shenzhen Adopt
5,750,000.00 holding based on
Network Co., Ltd.
strategic purpose
Beijing Konka Long-term
Sales of
Technology Co., -1,700,000.00 holding based on
equity
Ltd. strategic purpose
Long-term
AVO 98,878.20 holding based on
strategic purpose
Shaoyang Haishang
Ecological Long-term
Agricultural holding based on
Technology Co., strategic purpose
Ltd.
Long-term
Feihong Electronics
1,300,000.00 holding based on
Co., Ltd.
strategic purpose
Long-term
ZAEFI 100,000.00 holding based on
strategic purpose
Shenzhen Long-term
485,000.00
Chuangce holding based on
235
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reason for
Amount of being Reason for
Dividend
retained designated to be retained
income
Accum earnings measured at fair earnings
recognized Accumulative
Item ulative transferred value of which transferred
in the loss
gain from other recorded in from other
current
comprehensive other comprehen
period
income comprehensive sive income
income
Investment strategic purpose
Development Co.,
Ltd.
Shanlian
Long-term
Information
3,139,190.80 holding based on
Technology
strategic purpose
Engineering Center
Shenzhen CIU
Long-term
Science &
200,000.00 holding based on
Technology Co.,
strategic purpose
Ltd.
Shenzhen Digital
TV National Long-term
Engineering 1,273,594.84 holding based on
Laboratory Co., strategic purpose
Ltd.
Shanghai National
Long-term
Engineering
holding based on
Research Center of
strategic purpose
Digital TV Co., Ltd.
Long-term
Bohu UHD holding based on
strategic purpose
Total 17,146,663.84 -1,700,000.00
15. Other Non-current Financial Assets
236
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending balance Beginning balance
China Asset Management-Jiayi Overseas Designated Plan 203,000,000.00 203,000,000.00
Hunan Wanrong Technology Co., Ltd. 47,230,000.00 47,230,000.00
Yibin OCT Sanjiang Property Co., Ltd. 200,000,000.00 200,000,000.00
Yili Ecological Restoration Co., Ltd. 90,000,000.00 90,000,000.00
Kunshan Xinjia Emerging Industry Equity Investment Fund Partnership
13,028,268.90
(Limited Partnership)
Shenzhen Kanghong Dongsheng Investment Partnership (Limited
17,754,800.00
Partnership)
Tongxiang Wuzhen Jiayu Digital Economy Industry Equity Investment
40,000,000.00
Partnership (Limited Partnership)
Yibin Kanghui Electronic Information Industry Equity Investment
4,000,000.00
Partnership (Limited Partnership)
Chuzhou Jiachen Information Technology Consulting Service Partnership
49,200,000.00
(Limited Partnership)
Yancheng Kangyan Information Industry Investment Partnership (Limited
1,050,000.00
Partnership)
Subtotal of equity investments 665,263,068.90 540,230,000.00
Chuzhou Huike Smart Household Appliances Industry Investment
1,049,891,727.86 1,049,891,727.83
Partnership (Limited Partnership)
Ningbo Yuanqing No. 9 Investment Partnership 98,000,000.00 98,000,000.00
Shenzhen Beihu Technology Partnership (Limited Partnership) 65,000,000.00 65,000,000.00
Subtotal of debt investments 1,212,891,727.86 1,212,891,727.83
Total 1,878,154,796.76 1,753,121,727.83
16. Investment Property
(1) Investment properties measured at cost
Plant & buildings and land use
Item right
I. Original carrying value
1. Beginning balance 447,413,230.79
237
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Plant & buildings and land use
Item right
2. Increase in the current year 238,325,000.85
(1) Outsourcing
(2) Fixed assets\Construction in progress\Transfer of
238,325,000.85
intangible assets
3. Decrease in the current year 85,175,552.93
(1) Disposal 1,739,906.85
(2) Other transfer out 83,435,646.08
4. Ending balance 600,562,678.71
II. The accumulative depreciation and accumulative
amortization
1. Beginning balance 47,215,856.72
2. Increase in the current year 20,751,174.80
(1) Provision or amortization 20,751,174.80
3. Decrease in the current year 5,990,021.10
(1) Disposal 342,544.16
(2) Other transfer out 5,647,476.94
4. Ending balance 61,977,010.42
III. Depreciation reserves
1. Beginning balance
2. Increase in the current year
(1) Withdrawal
3. Decrease in the current year
(1) Disposal
(2) Other transfer out
4. Ending balance
IV. Carrying value
1. Ending carrying value 538,585,668.29
2. Beginning carrying value 400,197,374.07
238
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Note: The increase of investment real estate in the current period is mainly due to the completion
of Konka Yibin Industrial Park and Konka Yantai Industrial Park.
(2) Investment properties measured at fair value
There were no investment properties measured at fair value of the Company.
(3) Investment properties in the process of title certificate handling
Item Carrying value Reason
Incorporation and under
153,966,037.13
Konka Yibin Industrial Park processing
Incorporation and under
37,976,833.18
Konka Yantai Industrial Park processing
Total 191,942,870.31
239
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
17. Fixed assets
Item Ending carrying value Beginning carrying value
Fixed Assets 3,178,642,017.84 2,561,254,191.55
Fixed assets pending for disposal
Total 3,178,642,017.84 2,561,254,191.55
(1) List of Fixed Assets
Houses and Mechanical Electronic Transportation
Item Other equipment Total
buildings equipment equipment equipment
I. Original carrying
value
1. Beginning balance 2,035,218,106.99 2,017,148,345.41 184,064,655.85 58,063,867.63 241,613,861.33 4,536,108,837.21
2. Increased amount of
278,011,579.92 785,892,811.65 30,295,330.99 10,259,226.45 67,290,896.84 1,171,749,845.85
the period
(1) Purchase 46,512,597.89 158,307,301.21 29,379,778.67 10,259,226.45 61,819,125.07 306,278,029.29
(2) Transfer of
155,209,187.40 627,585,510.44 915,552.32 5,471,771.77 789,182,021.93
construction in progress
(3) Increase for business 76,289,794.63 76,289,794.63
240
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Houses and Mechanical Electronic Transportation
Item Other equipment Total
buildings equipment equipment equipment
combination
(4) Increase for other
428,097,969.36 111,846,244.51 7,433,057.11 3,380,172.25 10,854,225.10 561,611,668.33
reasons
3. Decreased amount of
117,153,018.44 111,846,244.51 7,081,833.81 3,380,172.25 10,854,225.10 250,315,494.11
the period
(1) Disposal or Scrap 310,944,950.92 351,223.30 311,296,174.22
(2) Decrease for loss of
1,885,131,717.55 2,691,194,912.55 206,926,929.73 64,942,921.83 298,050,533.07 5,146,247,014.73
controlling right
(3) Decrease for other
reasons
4. Ending balance 633,844,572.99 939,156,102.95 139,979,797.13 39,874,403.17 153,386,011.72 1,906,240,887.96
II. Accumulative
73,340,031.13 193,852,179.42 13,928,212.30 6,651,909.48 14,469,197.25 302,241,529.58
depreciation
1. Beginning balance 69,498,866.64 193,852,179.42 13,928,212.30 6,651,909.48 14,469,197.25 298,400,365.09
2. Increased amount of
3,841,164.49 3,841,164.49
the period
241
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Houses and Mechanical Electronic Transportation
Item Other equipment Total
buildings equipment equipment equipment
(1) Withdrawal 205,462,260.22 88,701,873.57 5,889,810.99 2,956,257.05 7,190,858.00 310,201,059.83
(2) Increase for business
60,421,028.86 88,701,873.57 5,670,143.24 2,956,257.05 7,150,911.79 164,900,214.51
combination
(3) Increase for other
145,041,231.36 219,667.75 39,946.21 145,300,845.32
reasons
3. Decreased amount of
501,722,343.90 1,044,306,408.80 148,018,198.44 43,570,055.60 160,664,350.97 1,898,281,357.71
the period
(1) Disposal or Scrap
(2) Decrease for loss of
1,247,805.91 64,023,905.57 1,156,577.28 820,215.24 1,365,253.70 68,613,757.70
controlling right
(3) Decrease for other
627,051.21 71,982.74 248,453.22 947,487.17
reasons
4. Ending balance 627,051.21 71,982.74 248,453.22 947,487.17
III. Depreciation
210,272.52 7,330.00 20,003.17 237,605.69
reserves
1. Beginning balance 210,272.52 7,330.00 20,003.17 237,605.69
242
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Houses and Mechanical Electronic Transportation
Item Other equipment Total
buildings equipment equipment equipment
2. Increased amount of
1,247,805.91 64,440,684.26 1,221,230.02 820,215.24 1,593,703.75 69,323,639.18
the period
(1) Withdrawal
(2) Increase for business
1,382,161,567.74 1,582,447,819.49 57,687,501.27 20,552,650.99 135,792,478.35 3,178,642,017.84
combination
3. Decreased amount of
1,400,125,728.09 1,013,968,336.89 42,928,281.44 17,369,249.22 86,862,595.91 2,561,254,191.55
the period
(1) Disposal or Scrap
(2) Decrease for loss of
2,035,218,106.99 2,017,148,345.41 184,064,655.85 58,063,867.63 241,613,861.33 4,536,108,837.21
controlling right
4. Ending balance 278,011,579.92 785,892,811.65 30,295,330.99 10,259,226.45 67,290,896.84 1,171,749,845.85
IV. Carrying value 46,512,597.89 158,307,301.21 29,379,778.67 10,259,226.45 61,819,125.07 306,278,029.29
1. Ending carrying value 155,209,187.40 627,585,510.44 915,552.32 5,471,771.77 789,182,021.93
2. Beginning carrying
76,289,794.63 76,289,794.63
value
243
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(2) List of Temporarily Idle Fixed Assets
Original Accumulative Impairment Carrying value
Item
carrying value depreciation provision
Mechanical
3,673,206.93 1,657,315.38 1,933,845.35 82,046.20
equipment
Electronic
1,492,298.49 1,083,615.47 408,683.02
equipment
Other equipment 866,004.14 738,638.36 26,675.22 100,690.56
Total 6,031,509.56 3,479,569.21 1,960,520.57 591,419.78
(3) Fixed Assets Leased in from Financing Lease
Accumulative Impairm Carrying value
Original carrying
Item depreciation ent
value
provision
Buildings 104,725,378.00 10,310,322.92 94,415,055.08
Mechanical
747,492,485.33 373,493,777.70 373,998,707.63
equipment
Transportation
10,078,398.20 8,363,765.16 1,714,633.04
equipment
Electronic
46,006,058.20 39,652,392.14 6,353,666.06
equipment
Other equipment 55,613,076.42 42,553,960.39 13,059,116.03
Total 963,915,396.15 474,374,218.31 489,541,177.84
(4) Fixed Assets Leased out from Operation Lease
Item Ending carrying value
Mechanical equipment 17,281,963.09
Transportation vehicles and electronic equipment 173,606.48
Total 17,455,569.57
(5) Details of Fixed Assets Failed to Accomplish Certification of Property
244
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Impa
irme
Original Accumulative Net carrying
Item nt Reason
carrying value depreciation value
provi
sion
New
Konka Yibin
construction
Industrial 122,091,094.58 122,091,094.58
with pending
Park
certificate
Yikang
Historical
Building 76,610,752.33 36,904,816.64 39,705,935.69
reasons
property
Jingyuan
Historical
Building 20,018,497.00 9,545,350.92 10,473,146.08
reasons
property
26-1
Longzhimeng,
Pangjiang
Street Under
6,072,572.34 1,019,177.51 5,053,394.83
Property in processing
Dadong
District,
Shenyang
Purification
tank for liquid
Under
waste of 2,653,000.00 1,482,363.75 1,170,636.25
processing
XingDa
HongYe
Total 105,354,821.67 48,951,708.82 56,403,112.85
(6) Fixed Assets with Restricted Ownership or Use Right
Ending carrying
Item Reasons
value
Housing and buildings of Anhui
154,681,545.21 Mortgage loans
Tongchuang
Machinery equipment of Jiangxi
141,962,217.67 Finance lease mortgage
Konka
Machinery equipment of Xinfeng
109,794,046.99 Finance lease mortgage
Microcrystalline
Housing and buildings of Frestec 94,415,055.08 Mortgage loans
245
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Refrigeration
Machinery equipment of Nano
80,230,031.99 Finance lease mortgage
Crystallized Glass
Buildings of Konka Group 72,448,630.14 As collateral for loan
Housing and buildings of
40,867,928.18 Finance lease mortgage
XingDa HongYe
Electronic equipment,
transportation equipment and 21,626,382.29 Finance lease mortgage
other equipment of Konka Group
Machinery equipment of
Dongguan Konka and other 15,650,423.83 Finance lease mortgage
equipment
Machinery equipment of Xingda
14,753,054.76 Finance lease mortgage
Hongye
Machinery equipment of Boluo
11,109,965.23 Finance lease mortgage
Konka Precision
Factories of Boluo Konka 7,526,113.83 Mortgage loans
As collateral for former shareholder’s
Buildings of Jiangxi Konka 3,676,370.92
guarantee
Total 768,741,766.12
18. Construction in Progress
Item Ending balance Beginning balance
Construction in Progress 9,236,643,931.68 4,291,544,368.52
Total 9,236,643,931.68 4,291,544,368.52
246
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
18.1 Construction in progress
(1) List of Construction in Progress
Ending balance Beginning balance
Carrying amount Imp Carrying value Carrying amount Impa Carrying value
air irme
Item men nt
t provi
prov sion
ision
Comprehensive improvement engineering project of
878,298,840.85 878,298,840.85 715,838,346.63 715,838,346.63
drainage basins in the city of Donggang
Central City Comprehensive accelerated programs
in Economic and Technological Development Zone 854,403,424.70 854,403,424.70 329,745,585.38 329,745,585.38
of Binhai, Weifang
Sewage treatment and water environment project in
736,291,181.05 736,291,181.05
Ankang County
PPP Project of Lushan Shahe Ecological
712,003,094.27 712,003,094.27 511,792,398.90 511,792,398.90
Rehabilitation and Improvement (Phase I)
PPP Project of Funan Sewage Treatment 698,546,462.73 698,546,462.73 592,295,248.19 592,295,248.19
Comprehensive water environment improvement
693,071,428.99 693,071,428.99
project in Mengcheng County, Anhui Province
Water supply engineering project in Mazongshan
Town, Subei Mongol Autonomous County, Gansu 651,327,229.42 651,327,229.42 571,112,712.15 571,112,712.15
Province
Integrated PPP Project of Huangpi Sewage 566,856,746.38 566,856,746.38 385,214,225.65 385,214,225.65
247
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Carrying amount Imp Carrying value Carrying amount Impa Carrying value
air irme
Item men nt
t provi
prov sion
ision
Treatment
Ankang Smart Plant 549,848,298.86 549,848,298.86 143,320,357.80 143,320,357.80
The second line of Jiangxi Nano Crystallized Glass 335,893,840.77 335,893,840.77 336,485,492.44 336,485,492.44
Dayi Project 317,578,212.72 317,578,212.72 79,258,722.98 79,258,722.98
Phase I of ecological restoration and protection of
315,363,263.81 315,363,263.81
Danhe River Basin in Gaoping City
Water environment improvement project in
294,709,246.41 294,709,246.41
downtown Chongzhou
Tongchuan Project 265,143,141.30 265,143,141.30 99,720,949.28 99,720,949.28
The second sewage plant of Laizhou 188,185,801.03 188,185,801.03 90,971,785.34 90,971,785.34
Construction of Suining Electronic Industrial Park
185,205,457.46 185,205,457.46 49,129,811.44 49,129,811.44
Workshops
Franchise project of disposal of kitchen waste in
170,314,313.43 170,314,313.43
Gaoling, Xi'an
Water supply and water resources development
159,947,876.21 159,947,876.21
project in Changning
R&D equipment construction project of Chongqing
129,766,743.81 129,766,743.81
Optoelectronic Research Institute
Phase II of Rural Residential Environment 129,657,635.39 129,657,635.39
248
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Carrying amount Imp Carrying value Carrying amount Impa Carrying value
air irme
Item men nt
t provi
prov sion
ision
Improvement and Reconstruction Project (domestic
sewage treatment) in Qinhan New Town
Guangming Project 122,764,816.91 122,764,816.91 39,753,607.36 39,753,607.36
Yibin Konka High-Tech Industrial Park 86,183,539.65 86,183,539.65
Xinfeng Line 1 modification project 85,768,083.75 85,768,083.75
Other projects 281,466,875.18 281,466,875.18 174,953,501.58 174,953,501.58
Total 9,236,643,931.68 9,236,643,931.68 4,291,544,368.52 4,291,544,368.52
(2) Changes of Significant Construction in Progress
Decreased
Name of item Beginning balance Increased Transferred to Other Ending balance
long-term assets decrease
Comprehensive improvement engineering
project of drainage basins in the city of 715,838,346.63 162,460,494.22 878,298,840.85
Donggang
Central City Comprehensive accelerated
programs in Economic and Technological 329,745,585.38 524,657,839.32 854,403,424.70
Development Zone of Binhai, Weifang
249
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Decreased
Name of item Beginning balance Increased Transferred to Other Ending balance
long-term assets decrease
Sewage treatment and water environment
736,291,181.05 736,291,181.05
project in Ankang County
PPP Project of Lushan Shahe Ecological
511,792,398.90 200,210,695.37 712,003,094.27
Rehabilitation and Improvement (Phase I)
PPP Project of Funan Sewage Treatment 592,295,248.19 106,251,214.54 698,546,462.73
Comprehensive water environment
improvement project in Mengcheng County, 693,071,428.99 693,071,428.99
Anhui Province
Water supply engineering project in
Mazongshan Town, Subei Mongol Autonomous 571,112,712.15 80,214,517.27 651,327,229.42
County, Gansu Province
Integrated PPP Project of Huangpi Sewage
385,214,225.65 181,642,520.73 566,856,746.38
Treatment
Ankang Smart Plant 143,320,357.80 406,527,941.06 549,848,298.86
The second line of Jiangxi Nano Crystallized
336,485,492.44 591,651.67 335,893,840.77
Glass
Dayi Project 79,258,722.98 238,319,489.74 317,578,212.72
Phase I of ecological restoration and protection
315,363,263.81 315,363,263.81
of Danhe River Basin in Gaoping City
Water environment improvement project in
294,709,246.41 294,709,246.41
downtown Chongzhou
Tongchuan Project 99,720,949.28 165,422,192.02 265,143,141.30
250
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Decreased
Name of item Beginning balance Increased Transferred to Other Ending balance
long-term assets decrease
The second sewage plant of Laizhou 90,971,785.34 97,214,015.69 188,185,801.03
Construction of Suining Electronic Industrial
49,129,811.44 138,669,460.06 2,593,814.04 185,205,457.46
Park Workshops
Franchise project of disposal of kitchen waste
170,314,313.43 170,314,313.43
in Gaoling, Xi'an
Water supply and water resources development
159,947,876.21 159,947,876.21
project in Changning
R&D equipment construction project of
543,924,950.08 414,158,206.27 129,766,743.81
Chongqing Optoelectronic Research Institute
Phase II of Rural Residential Environment
Improvement and Reconstruction Project
129,657,635.39 129,657,635.39
(domestic sewage treatment) in Qinhan New
Town
Guangming Project 39,753,607.36 83,780,590.74 769,381.19 122,764,816.91
Yibin Konka High-Tech Industrial Park 86,183,539.65 189,873,592.06 276,057,131.71
Xinfeng Line 1 modification project 85,768,083.75 8,847,307.77 94,615,391.52
Other projects 511,438,994.02 375,768,538.94 265,950,228.28 3,304,937.06 617,360,715.95
Total 4,291,544,368.52 6,003,140,304.90 1,054,144,153.01 3,896,588.73 9,236,643,931.68
(Continued)
251
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Estimate
Proportion Of which: the Capitalization
d Engineerin Accumulative
estimated of the amount of the rate of the
number g amount of
Name of item project capitalized interests of Capital resources
(RMB10 Schedule capitalized
accumulative interests of the the period
0 (%) interests
input (%) period (%)
million)
Comprehensive improvement
Self-owned fund and bank
engineering project of drainage 12.99 67.61 67.61 69,458,190.80 36,309,241.28 6.05
financing
basins in the city of Donggang
Central City Comprehensive
accelerated programs in Economic Self-owned fund and bank
16.50 51.78 51.78 22,075,641.66 16,389,971.72 5.36
and Technological Development financing
Zone of Binhai, Weifang
Sewage treatment and water
environment project in Ankang 22.41 32.86 32.86 Self-owned fund
County
PPP Project of Lushan Shahe
Ecological Rehabilitation and 12.68 56.16 56.16 Self-owned fund
Improvement (Phase I)
PPP Project of Funan Sewage Self-owned fund and bank
9.72 71.84 71.84 25,861,378.47 21,938,159.72 4.82
Treatment financing
Comprehensive water environment
improvement project in
15.93 43.49 43.49 Self-owned fund
Mengcheng County, Anhui
Province
Water supply engineering project 9.70 67.14 67.14 20,628,731.25 20,628,731.25 5.05 Self-owned fund and bank
252
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Estimate
Proportion Of which: the Capitalization
d Engineerin Accumulative
estimated of the amount of the rate of the
number g amount of
Name of item project capitalized interests of Capital resources
(RMB10 Schedule capitalized
accumulative interests of the the period
0 (%) interests
input (%) period (%)
million)
in Mazongshan Town, Subei financing
Mongol Autonomous County,
Gansu Province
Integrated PPP Project of Huangpi Self-owned fund and bank
7.38 76.77 76.77 14,431,587.50 14,431,587.50 4.80
Sewage Treatment financing
Ankang Smart Plant 9.3 59.12 59.12 Self-owned fund
Dayi Project Self-owned fund and bank
3.92 80.99 80.99 6,075,035.28 6,075,035.28 7.91
financing
Phase I of ecological restoration
and protection of Danhe River 8.93 35.32 35.32 Self-owned fund
Basin in Gaoping City
Water environment improvement
8.82 33.40 33.40 Self-owned fund
project in downtown Chongzhou
Tongchuan Project 3.93 67.46 67.46 Self-owned fund
The second sewage plant of
2.56 73.41 73.41 5,288,393.57 5,288,393.57 5.30 Self-owned fund
Laizhou
Construction of Suining Electronic
7.04 31.09 31.09 Self-owned fund
Industrial Park Workshops
Franchise project of disposal of 2.46 69.32 69.32 Self-owned fund
253
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Estimate
Proportion Of which: the Capitalization
d Engineerin Accumulative
estimated of the amount of the rate of the
number g amount of
Name of item project capitalized interests of Capital resources
(RMB10 Schedule capitalized
accumulative interests of the the period
0 (%) interests
input (%) period (%)
million)
kitchen waste in Gaoling, Xi'an
Water supply and water resources
5.57 28.71 28.71 Self-owned fund
development project in Changning
R&D equipment construction
project of Chongqing 7.08 71.65 71.65 Self-owned fund
Optoelectronic Research Institute
Phase II of Rural Residential
Environment Improvement and
Reconstruction Project (domestic 7.99 16.23 16.23 Self-owned fund
sewage treatment) in Qinhan New
Town
Self-owned fund and
Guangming Project 5.33 23.19 23.19 1,318,597.14 1,318,597.14 1.57
project financing
Yibin Konka High-Tech Industrial
3.50 100.00 100.00 Self-owned fund
Park
Xinfeng Line 1 modification Bank financing and
0.2 44.24 44.24
project finance lease
Other projects 39,229,802.86
Total 236,617,352.69 122,379,717.46
254
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
19. Intangible Assets
(1) List of intangible assets
Intellectual property
Item Land use right Patent and Total
Trademark right Franchise rights Right to use Subtotal
know-how
I. Original carrying value
1. Beginning balance 1,026,423,067.19 75,482,617.43 102,532,417.78 106,571,344.10 99,690,005.24 384,276,384.55 1,410,699,451.74
2. Increased amount of the
191,543,920.63 5,000.00 18,655,803.18 18,660,803.18 210,204,723.81
period
(1) Purchase 184,398,069.18 5,000.00 7,219,776.82 7,224,776.82 191,622,846.00
(2) Transfer of construction
9,624,190.74 9,624,190.74 9,624,190.74
in progress
(3) Internal R&D 1,811,835.62 1,811,835.62 1,811,835.62
(4) Transfer from
7,145,851.45 7,145,851.45
investment property
3. Decreased amount of the
171,140,223.69 171,140,223.69
period
(1) Disposal 73,038,856.61 73,038,856.61
(2) Decrease for loss of
45,779,912.32 45,779,912.32
controlling right
(3) Decrease in transfer-in
52,321,454.76 52,321,454.76
of investment real estate
4. Ending balance 1,046,826,764.13 75,487,617.43 102,532,417.78 106,571,344.10 118,345,808.42 402,937,187.73 1,449,763,951.86
255
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Intellectual property
Item Land use right Patent and Total
Trademark right Franchise rights Right to use Subtotal
know-how
II. Accumulated
- -
amortization
1. Beginning balance 78,757,617.42 5,272,221.47 56,417,825.66 11,105,062.50 42,973,928.86 115,769,038.49 194,526,655.91
2. Increased amount of the
36,970,965.44 231.48 26,413,690.21 4,442,025.00 12,810,539.69 43,666,486.38 80,230,695.34
period
(1) Withdrawal 35,164,652.99 231.48 26,413,690.21 4,442,025.00 12,810,539.69 43,666,486.38 78,424,382.89
(2) Other increases 1,806,312.45 1,806,312.45
3. Decreased amount of the
17,085,483.51 17,085,483.51
period
(1) Disposal 7,524,347.17 7,524,347.17
(2) Decrease for loss of
1,655,203.71 1,655,203.71
controlling right
(3) Decrease in transfer-in
7,905,932.63 7,905,932.63
of investment real estate
4. Ending balance 98,643,099.35 5,272,452.95 82,831,515.87 15,547,087.50 55,377,712.07 159,028,768.39 257,671,867.74
III. Depreciation reserves
1. Beginning balance 2,901,082.61 2,901,082.61 2,901,082.61
2. Increased amount of the
period
(1) Withdrawal
(2) Increase for business
combination
256
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Intellectual property
Item Land use right Patent and Total
Trademark right Franchise rights Right to use Subtotal
know-how
3. Decreased amount of the
period
(1) Disposal
(2) Decrease for loss of
controlling right
4. Ending balance 2,901,082.61 2,901,082.61 2,901,082.61
IV. Carrying value
1. Ending carrying value 948,183,664.78 70,215,164.48 16,799,819.30 91,024,256.60 62,968,096.35 241,007,336.73 1,189,191,001.51
2. Beginning carrying value 947,665,449.77 70,210,395.96 43,213,509.51 95,466,281.60 56,716,076.38 265,606,263.45 1,213,271,713.22
The ratio of intangible assets formed through internal R&D to the balance of intangible assets by the end of this year was 0.15%.
257
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(2) Intangible assets leased through financial leasing
Item Original book Accumulated Provision for Carrying value
value amortization impairment
land use right 74,399,250.00 4,710,869.54 69,688,380.46
Patents and
28,000,000.00 16,000,000.00 12,000,000.00
know-how
Total 102,399,250.00 20,710,869.54 81,688,380.46
(3) Land Use Right with Certificate of Title Uncompleted
Item Carrying value Reason
Land usage right of the
5,236,420.37 Under processing
subsidiary Nanocrystalline
Total 5,236,420.37
(4) Significant Intangible Assets
Remaining amortization
Item Ending carrying value
period
Land usage right of Fenggang Konka
198,040,434.67 48.67
Intelligent Industrial Park
Frestec Zhijia land use right 96,024,621.61 49.75
Franchise rights of sewage treatment in
95,503,537.51 21.50
Laizhou
Land usage right of Chongqing Konka 61,789,103.75 48.67
Land usage right of Frestec 69,688,380.46 35.75
Land usage right of Huanjia (Henan) 65,894,816.06 48.50
Land usage right of Anhui Konka 2 # land 55,952,866.67 47.83
Land usage right of Anhui Konka 3# land 19,212,162.54 47.92
Total 662,105,923.27
(5) Intangible Assets with restricted ownership or using right
Item Ending carrying value Reasons
Land usage right of Frestec 69,688,380.46 As collateral for
258
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending carrying value Reasons
loan
Land usage right of Anhui Konka 2 # As collateral for
55,952,866.67
land loan
As collateral for
Land use right of Anhui Tongchuang 18,920,247.71
loan
As collateral for
Land usage right of XingDa HongYe 14,517,613.34
loan
Yikang technology patents and Finance lease
12,000,000.00
know-how mortgage
Original
Land usage right of Jiangxi Konka 10,518,420.58 shareholder
guarantee mortgage
As collateral for
Land use right of Kangjia in Yibin 5,705,407.85
loan
As collateral for
Land use right of Konka Guangming 5,339,539.00
loan
As collateral for
Land use right of Boluo Konka 1,113,084.13
loan
Total 193,755,559.74
20. Development expenditures
Begin Increased Decreased Endin
ning Expenditure Amount Transferred g
Item
balanc of internal recognized as into current balan
e development intangible assets profit or loss ce
AIOT scene audio
system based on NLP - 1,811,835.62 1,811,835.62 - -
algorithm
Total 1,811,835.62 1,811,835.62 - -
Note: In November 2020, the AIOT voice system based on NLP algorithm developed by the
Company reached the serviceable conditions and was accepted and moved from development
expense to intangible assets as it met the conditions to be reported as intangible assets.
21. Goodwill
(1) Original Carrying Value of Goodwill
259
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increased Decreased
Name of the
Beginning balance Formed Othe Ending balance
investees Others Dispose
from the rs
3,597,65
Anhui Konka 3,597,657.15
7.15
Econ
467,825,151.34 467,825,151.34
Technology
Jiangxi Konka 340,111,933.01 340,111,933.01
XingDa
44,156,682.25 44,156,682.25
HongYe
3,597,65
Total 855,691,423.75 852,093,766.60
7.15
(2) Provisions for Goodwill Impairment
Name of Increased Decreased
Beginning
the Ending balance
balance Withdrawal Others Dispose Others
investees
Anhui 3,597,65
3,597,657.15
Konka 7.15
Econ
Technology
Jiangxi
76,431,127.34 77,906,818.95 154,337,946.29
Konka
XingDa
21,959,947.14 21,959,947.14
HongYe
3,597,65
Total 76,431,127.34 103,464,423.24 176,297,893.43
7.15
(3) Relevant information on the asset group or combination of asset groups where goodwill is
located
This year, the company hired an appraisal agency to assess the recoverable amount of the asset
group or combination of asset groups where the goodwill is located. The asset group composed of
identifiable intangible assets (excluding working capital and non-operating assets) is related to
goodwill. The confirmation of the asset group at the time of goodwill impairment test is
consistent with the asset group or combination of asset groups determined at the date of purchase
260
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
and the previous year’s goodwill impairment test.
(4) The key assumptions and basis for calculating the recoverable amount of the asset group are
as follows:
① Assuming that the assessed unit continues to operate, and there are no major changes in the
key aspects of the business scope, sales model and channels, management, etc. that affect
production and operation from the current situation;
② Assume that the social and economic environment of the assessed unit does not change
significantly, and the relevant laws, regulations, and policies of the country and the region where
the company is located have no major changes;
③ Assume that the business scope, operation mode, management mode, etc. of the assessed unit
are continuously improved and improved on the basis of maintaining consistency, and can make
timely adjustments and innovations as the economy develops;
④ Assume that the various products provided by the assessed unit can adapt to market demand,
the formulated goals and measures can be achieved as scheduled and at the scheduled time, and
the expected benefits are obtained;
⑤ Assuming that interest rates, exchange rates, tax bases and tax rates do not change significantly
within the normal range prescribed by the state.
⑥ The recoverable amount of the asset group and asset group combination is based on the
five-year budget approved by the management and calculated using the cash flow forecast
method.
(5) The goodwill impairment of each asset group of the company is as follows:
The recoverable amount of Jiangxi Konka is determined according to the present value of the
expected future cash flow. The future cash flow is determined based on the financial budget
approved by management from 2021 to 2025, and uses a discount rate of 13.48%. Jiangxi
Konka’s cash flow for more than 5 years is calculated based on a growth rate of 0%. The
company hired an appraisal agency, Beijing Zhongtianhe Assets Appraisal Co., Ltd., to evaluate
the company’s subsidiary Jiangxi Konka Company using the income method and cost method,
using the present value of the asset group’s estimated future cash flows as its recoverable amount.
On 22 March 2021,Konka Group Co., Ltd.'s Asset Evaluation Report on Recoverable Amount
Items of Goodwill Asset Group of Konka New Materials Asset Group for Financial Reporting
Purposes after Goodwill Impairment Test (ZTHPZ [2021] No. 90006), was issued with 31
December 2020 as the base date. The current value of Jiangxi Konka Assets Group on the
assessment base date is RMB 1,481,000,000, and the book value of the asset group after fair
261
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
value adjustment (including overall goodwill) is RMB 1,633,758,400 of which the book value of
goodwill (converted minority shareholders) is RMB 517,021,100. As the recoverable amount of
the asset group is less than the book value of the asset group containing goodwill, Jiangxi
Konka’s goodwill provision for asset impairment is RMB 77,906,800 in the current period.
The recoverable amount of XingDa HongYe is determined according to the present value of the
expected future cash flow. The future cash flow is determined based on the financial budget
approved by management from 2021 to 2025, and uses a discount rate of 13.50%. XingDa
HongYe’s cash flow for more than 5 years is calculated based on a growth rate of 0%. The
Company hired an appraisal agency, Beijing Zhongtianhe Assets Appraisal Co., Ltd., to evaluate
the Company’s subsidiary XingDa HongYe using the income method and the cost method, using
the present value of the asset group’s estimated future cash flows as its recoverable amount. On
22 March 2021, Konka Group Co., Ltd.'s Asset Evaluation Report on Recoverable Amount Items
of Goodwill Asset Group of XingDa HongYe for Financial Reporting Purposes after Goodwill
Impairment Test (ZTHPZ [2021] No. 90007), was issued with 31 December 2020 as the base date.
The current value of XingDa HongYe on the base date is RMB2.95182million, and the book
value of the asset group after fair value adjustment (including overall goodwill) is RMB
338,240,700, of which the book value of goodwill (minority shareholders included) is RMB
86,581,700. The recoverable amount of the asset group is less than the book value of the asset
group containing goodwill. Therefore, XingDa HongYe Company's goodwill provision for asset
impairment is RMB 21.96 million in this period.
All the asset groups of Anhui Konka that contain goodwill have been disposed of. Therefore,
Anhui Konka’s goodwill provision for asset impairment is RMB 3,597,700 in the current period
and treat the goodwill as decrease.
The recoverable amount of Econ Technology is determined according to the present value of the
expected future cash flow. The future cash flow is determined based on the financial budget
approved by management from 2021 to 2025, and uses a discount rate of 13.68%. Econ
Technology’s cash flow for more than 5 years is calculated based on a growth rate of 0%. The
company hired an appraisal agency, Beijing Zhongtianhe Assets Appraisal Co., Ltd., to evaluate
the company’s subsidiary Econ Technology using the income method, using the present value of
the asset group’s estimated future cash flows as its recoverable amount. On 22 March 2021,Konka
Group Co., Ltd.'s Asset Evaluation Report on Recoverable Amount Items of Goodwill Asset Group
of Econ Technology for Financial Reporting Purposes after Goodwill Impairment Test (ZTHPZ
[2021] No. 90008), was issued with 31 December 2020 as the base date. The current value of
Econ Technology Assets Group on the assessment base date is RMB 989,000,000, and the book
value of the asset group after fair value adjustment (including overall goodwill) is RMB
929,908,300 of which the book value of goodwill (converted minority shareholders) is RMB
262
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
917,304,200. The recoverable amount of the asset group is more than the book value of the asset
group containing goodwill. Therefore, Econ Technology has passed the goodwill impairment test,
and there is no impairment provision.
22. Long-term Deferred Expenses
Beginning Amortization Other decreased
Item Increased Ending balance
balance amount amount
Renovat
ion 35,841,835.32 74,298,710.43 17,050,791.01 167,517.29 92,922,237.45
costs
Shoppe
44,140,602.62 26,144,987.84 29,972,968.23 15,633,992.77 24,678,629.46
expense
Others 27,607,640.94 51,456,808.36 40,693,905.40 2,772,847.99 35,597,695.91
Total 107,590,078.88 151,900,506.63 87,717,664.64 18,574,358.05 153,198,562.82
23. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets without Offset
Ending balance Beginning balance
Deferred
Deductible Deferred income Deductible
Item income tax
temporary tax liabilities temporary
liabilities
difference assets difference
assets
Deductible
3,454,342,497.93 765,781,935.91 2,855,624,412.76 706,342,740.49
losses
Assets
impairment 1,672,345,584.63 355,173,623.87 1,079,890,030.44 231,517,239.58
provision
Deferred
302,984,312.52 75,408,820.37 66,778,170.56 15,971,309.52
Income
Accrued
206,844,865.32 40,844,897.61 70,273,842.14 12,047,558.72
expenses
Unrealized
internal sales 37,257,399.14 9,068,649.87 18,570,975.99 4,642,744.00
profits
Others 90,902,865.84 19,638,509.76 75,254,629.43 17,241,589.86
Total 5,764,677,525.38 1,265,916,437.39 4,166,392,061.32 987,763,182.17
(2) Lists of Deferred Income Tax Liabilities without Offset
263
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Deferred Deferred
Taxable Taxable
Item income tax income tax
temporary temporary
liabilities liabilities
difference difference
Liability Liability
Estimated added
value of assets not
303,689,567.68 57,097,842.23 406,494,736.72 76,293,954.88
under the same
control
Prepaid interest 48,578,683.63 11,840,140.77 68,199,141.94 16,489,202.46
Accelerated
depreciation of 4,443,598.64 959,974.66 3,732,276.80 559,841.52
fixed assets
Others 27,585,930.42 5,921,274.27 8,496,388.76 2,124,097.19
Total 384,297,780.37 75,819,231.93 486,922,544.22 95,467,096.05
(3) List of Unrecognized Deferred Income Tax Assets
Item Ending balance Beginning balance
Deductible losses 1,526,406,964.50 2,693,777,327.44
Deductible temporary difference 766,691,485.59 407,628,243.69
Total 2,293,098,450.09 3,101,405,571.13
(4) Deductible loss of the unrecognized deferred income tax assets will be due in the following
years
Year Ending balance
2021 375,609,938.04
2022 333,312,677.24
2023 146,623,243.29
2024 165,757,234.71
2025 505,103,871.22
Total 1,526,406,964.50
24. Other Non-current Assets
264
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Impairm
Item Carrying
ent Carrying value
amount
provision
Prepayment for land-purchase 1,538,728,032.15 1,538,728,032.15
Prepaid amount for engineering, equipment
247,719,684.59 247,719,684.59
and other long-term assets
Entrusted loans 10,867,888.84 10,867,888.84
Construction of government projects 23,463,565.16 23,463,565.16
Total 1,820,779,170.74 1,820,779,170.74
(Continued)
Beginning balance
Item Impairment
Carrying amount Carrying value
provision
Prepayment for land-purchase 820,340,528.30 820,340,528.30
Prepaid amount for engineering,
equipment and other long-term 277,656,830.39 277,656,830.39
assets
Entrusted loans 40,000,000.00 40,000,000.00
Construction of government
34,475,365.16 34,475,365.16
projects
Total 1,172,472,723.85 1,172,472,723.85
25. Short-term Borrowings
Item Ending balance Beginning balance Description
Unsecured
borrowings 7,164,301,258.30 7,305,280,566.00
Borrowings
secured by 2,038,705,892.75 1,505,320,018.29 ①②③
guarantee
Borrowings ④⑤⑥⑦⑧⑨
secured by 1,787,543,324.73 1,522,086,655.34
collateral ⑩
Total 10,990,550,475.78 10,332,687,239.63
265
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Notes: ① The Company provides joint liability guarantees for its subsidiary Anhui Konka,
Dongguan Konka, Sichuan Konka, Anhui Tongchuang, Pengrun Technology, Electronics
Technology, Econ Technology, Kong Kong Konka, Jiangxi Konka, Nano Crystallized Glass,
Xinfeng Microcrystalline and Ningbo Kanghanrui Appliances for a total of RMB
1,477,297,053.28.
② The Company obtained a short-term loan of RMB 500,000,000.00 from Chegongmiao
Sub-branch of China Everbright Bank, under maximum joint liability guarantee provided by
Electronics Technology, a subsidiary of the Company.
③ The Company provided a maximum-amount joint-liability guarantee for a short-term
borrowing of RMB61,408,839.47 granted by the Yantai sub-branch of Industrial Bank to the
Company’s subsidiary Econ Technology.
④ The Company put bank deposits of RMB81,839,066.89 in pledge for a short-term borrowing
of RMB157,135,000.00 and bank acceptance notes of RMB69,398,133.78 from China Zheshang
Bank.
⑤ The Company put certificates of deposit of RMB200,000,000.00 in pledge for a short-term
borrowing of RMB199,778,333.33 from the Shenzhen branch of China Everbright Bank.
⑥ The Company put security deposits of RMB150,000,000.00 in pledge for a short-term
borrowing of RMB297,933,333.35 from the Shenzhen branch of Guangdong Huaxing Bank.
⑦ The Company put structured deposits of RMB289,160,000.00 in pledge for a short-term
borrowing of RMB298,377,374.45 from Xiamen International Bank.
⑧ The Company’s subsidiary Electronic Technology put structured deposits of
RMB310,000,000.00 in pledge for a short-term borrowing of RMB318,033,786.31 from Xiamen
International Bank.
⑨ The Company’s subsidiary Anhui Tongchuang put security deposits of RMB15,000,000.00
and notes receivable of RMB100,800,000 in pledge for a short-term borrowing of
RMB137,655,744.43 from the Hefei branch of China Zheshang Bank.
⑩ The Company’s subsidiary Econ Technology put RMB75,000,000.00 in pledge for a short
266
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
term borrowing of RMB148,629,752.86 from the Yantai branch of China Zheshang Bank, with
the Company providing the joint-liability guarantee.
The Company’s subsidiary XingDa HongYe obtained a short-term loan of RMB
95,000,000.00 from the Zhongshan Rural Commercial Bank using, by creating a pledge on time
deposit certificates with a book value of RMB 19,800,000.00 and on a mortgage on buildings of
RMB40,867,928.18 and land use rights of RMB14,517,613.34. Hu Zehong provided joint
liability guarantee for the loan.
The Company’s subsidiary Boluo Konka Precision obtained a short-term loan of RMB
5,000,000.00 from Guangzhou Bank Co., Ltd. Huizhou Branch with the real estate of Boluo
Konka with the book value of RMB 7,526,113.83 and land use rights of RMB1,113,084.13 as
collateral. Konka Group provides joint liability guarantee.
The Company’s subsidiary Anhui Konka obtained a short-term loan of RMB 80,000,000.00
from Chuzhou Branch of Bank of China by creating mortgage on land use right with a book value
of RMB 55,952,866.67 and ongoing projects worth RMB 328,756,028.19. The Company
provided joint liability guarantee for the loan.
The Company’s subsidiary Anhui Tongchuang obtained a short-term loan of RMB
50,000,000.00 from China Zheshang Bank Hefei Branch with a mortgage on real estate with a
book value of RMB 154,681,545.21 and collateral on land use right worth RMB 18,920,247.71.
26. Notes Payable
Category Ending balance Beginning balance
Bank’s acceptance bill 1,159,251,569.31 1,136,168,273.60
Commercial acceptance bill 176,735,456.90 183,228,100.77
Total 1,335,987,026.21 1,319,396,374.37
27. Accounts Payable
(1) List of Accounts Payable
Item Ending balance Beginning balance
Within 1 year 8,134,924,659.58 4,589,056,681.97
267
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending balance Beginning balance
1 to 2 years 1,279,766,515.39 1,000,925,754.57
2 to 3 years 87,184,184.40 165,360,015.84
Over 3 years 130,490,966.39 42,480,027.22
Total 9,632,366,325.76 5,797,822,479.60
(2) Significant Accounts Payable Aging over One Year
Item Unpaid/Un-carry-over
Ending balance
reason
Hunan Fifth Engineering Co. Not meet the settlement
592,728,404.31 conditions
Ltd
China Railway No. 4 Not meet the settlement
305,090,587.47 conditions
Engineering Group Co., Ltd.
Chongqing Jiulong Kuiguan Not meet the settlement
115,552,377.45 conditions
Building Materials Co., Ltd.
Henan Yaofeng Industrial Co., Not meet the settlement
Ltd. 98,891,330.28 conditions
Not meet the settlement
Rushan Water Group Co., Ltd. 99,558,100.00 conditions
Total 1,211,820,799.51 —
28. Contractual liabilities
(1) Details of Contractual liabilities
Item Ending balance Beginning balance
Sales advances received 1,217,367,735.94 959,538,151.80
Total 1,217,367,735.94 959,538,151.80
(2) There is no significant change in carrying amount of contractual liabilities in the current
period
268
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
29. Payroll Payable
(1) List of Payroll Payable
Item Beginning Increased Decreased Ending balance
balance
List of Short-term Salary 422,361,193.20 1,772,852,908.34 1,722,013,304.70 473,200,796.84
Post-employment
benefit-defined 3,408,038.58 68,338,032.86 69,462,795.62 2,283,275.82
contribution plans
Termination benefits 1,101,266.80 39,874,526.02 39,843,621.03 1,132,171.79
Current portion of other
- - - -
benefits
Total 426,870,498.58 1,881,065,467.22 1,831,319,721.35 476,616,244.45
(2) List of Short-term Salary
Beginning
Item Increased Decreased Ending balance
balance
Salary, bonus,
407,335,502.77 1,568,242,877.25 1,517,512,854.56 458,065,525.46
allowance, subsidy
Welfare for
5,147,293.66 59,180,912.56 63,324,920.30 1,003,285.92
employees
Social securities
3,211,419.29 47,645,814.91 45,969,544.25 4,887,689.95
expense
Of which: Medical
289,685.48 42,276,867.29 41,308,977.99 1,257,574.78
insurance premiums
Work-related
39,991.73 977,895.80 930,601.24 87,286.29
injury insurance
Maternity
2,881,742.08 4,391,051.82 3,729,965.02 3,542,828.88
insurance
Housing fund 604,087.40 51,740,892.25 50,850,048.27 1,494,931.38
Labor union budget
and employee 5,237,407.88 12,986,389.12 10,940,610.59 7,283,186.41
education budget
269
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning
Item Increased Decreased Ending balance
balance
Short-term absence
with payment
Short-term profit
sharing plan
Others 825,482.20 11,751,566.42 12,110,870.90 466,177.72
Total 422,361,193.20 1,751,548,452.51 1,700,708,848.87 473,200,796.84
(3) List of Defined Contribution Plan
Item Beginning Increased Decreased Ending
balance balance
Basic pension benefits 3,353,470.05 66,664,960.26 67,851,155.26 2,167,275.05
Unemployment insurance 54,568.53 1,672,701.23 1,611,640.36 115,629.40
Annuity 371.37 371.37
Total 3,408,038.58 68,338,032.86 69,462,795.62 2,283,275.82
30. Taxes Payable
Item Ending balance Beginning balance
Corporate income tax 264,749,734.19 341,818,196.88
VAT 186,891,111.62 197,795,056.62
Fund for disposing abandoned
19,157,745.00 22,862,428.00
appliances and electronic products
Urban maintenance and construction tax 10,206,690.62 12,363,121.25
Education fees and local education
7,361,219.22 9,346,458.05
Surcharge
Stamp duty 6,041,179.34 5,046,657.96
Land use tax 5,095,730.68 3,587,908.55
Individual income tax 3,023,518.75 7,468,808.32
Property tax 2,209,076.63 2,868,061.86
Tariff 2,008,914.61 2,440,099.93
Others 1,469,138.50 2,248,497.57
270
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending balance Beginning balance
Total 508,214,059.16 607,845,294.99
31. Other payables
Item Ending balance Beginning balance
Interest payable 220,837,380.17 227,831,108.53
Other Payables 1,778,593,519.52 2,053,341,998.25
Total 1,999,430,899.69 2,281,173,106.78
31.1. Interests payable
(1) Classification
Item Ending balance Beginning balance
Interest on corporate bonds 180,268,944.49 180,268,944.49
Interest on long-term borrowings
with interest paid by installment and 17,162,676.76 27,783,745.85
principal paid at maturity
Interest payable on short-term
borrowings 23,350,524.40 19,189,933.23
Others 55,234.52 588,484.96
Total 220,837,380.17 227,831,108.53
31.2 Other payables
(1) Listed by Nature of Account
Item Ending balance Beginning balance
Expenses payable 626,909,820.31 854,281,815.33
Come-and-go money 330,967,783.33 162,935,213.66
Equity transfer payment 157,682,796.96 374,725,896.96
Related party borrowing 344,520,800.92 374,227,833.11
money Generation of advances 243,197,538.56 260,078,756.86
Cash deposit and front 7,795,410.38 13,789,615.70
Others 67,519,369.06 13,302,866.63
Total 1,778,593,519.52 2,053,341,998.25
(2) Other Significant Payables Aging over One Year
271
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Unpaid/Un-carry-over
Ending balance
reason
Equity transfer money of Econ Not meet the settlement
96,500,000.00
Technology conditions
Equity transfer money of Not meet the settlement
61,180,000.00
Jiangxi Konka conditions
Total 157,680,000.00 —
32. Current Portion of Non-current Liabilities
Item Ending balance Beginning balance
Current portion of long-term
18,150,000.00 123,000,000.00
borrowings
Current portion of long-term
358,746,566.29 87,066,077.13
payables
Total 376,896,566.29 210,066,077.13
33. Other current liabilities
Item Ending balance Beginning balance
Accounts payable with trade
432,420,000.00
acceptance notes
Sales return payable 9,354,317.23 16,726,801.27
Total 441,774,317.23 16,726,801.27
34. Long-term Borrowings
(1) Classification
Item Ending balance Beginning balance Description
Guaranteed
2,058,000,000.00 ①、②
borrowings
③、④、⑤、
⑥、⑦、⑧、
Pledge borrowings 3,123,838,997.54 1,556,255,729.90
⑨、⑩、、
272
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Entrusted borrowings 611,060,000.00 3,334,060,000.00
Credit loan 190,000,000.00 123,000,000.00
Less: Current portion 18,150,000.00 123,000,000.00
Total 5,964,748,997.54 4,890,315,729.90
Notes: ① The Company obtained a long-term loan of RMB 2,000,000,000.00 from the
Export-Import Bank of China, with a loan term from 22 June 2020 to 24 June 2022. OCT Group,
the parent of the Company provides joint liability guarantee for the loan.
② Subsidiary XingDa HongYe obtained a long-term loan of RMB 58,000,000.00 from the
Xiamen International Bank, with a loan term from 25 November 2020 to 25 February 2022. The
Company provides maximum joint liability guarantee for the loan.
③ Donggang Kangrun, a subsidiary, took the accounts receivable under the Contract of the PPP
project of Donggang City Inland Comprehensive Treatment Project as a pledge to obtain a
long-term loan of RMB 600,000,000.00 from the China Construction Bank Donggang
Sub-branch. The loan period is from 31 January 2019 to 30 January 2036.
④ Subsidiary Funan Kangrun obtained a long-term loan of RMB 465,000,000.00 from the
Agricultural Development Bank of China Funan County Sub-branch with the feasibility gap
subsidy and government payment under the PPP project of the whole area sewage treatment
project of Funan County as pledge. The loan period is from 30 August 2019 to 22
August 2039.
⑤ Weifang Sihai, a subsidiary of the company, pledged the long-term loan amount of RMB
512,746,900.00 from Industrial Bank Co., Ltd. Weifang Branch with the accounts receivable
formed from all the proceeds and income rights of the Weifang Binhai Economic Development
Zone PPP project. The loan period is from 26 June 2019 to 25 June 2035.
⑥ Subsidiary Laizhou Lairun obtained a long-term loan of RMB 118,007,485.22 from Laizhou
Branch of Postal Savings Bank of China ,by pledging its the accounts receivable from all the
proceeds and right to proceeds under the contract in relation to the PPP project of Laizhou Second
Sewage Treatment Plant and supplementary agreements thereto. The loan term is from 17 January
2020 to 16 January 2040.
273
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
⑦ Subsidiary Econ Technology provides a commitment letter of balance complement for Wuhan
Runyuan when Wuhan Runyuan obtains a long-term loan of RMB 378,600,000.00 from Wuhan
Dongxihu District Sub-branch of Agricultural Development Bank of China by pledging its
accounts receivable under the contract in connection with Huangling District Rural Sewage
Treatment PPP Project. The loan term is from 22 January 2020 to 19 January 2040.
⑥ Subsidiary Econ Technology provides joint liability guarantee for Subei Kangrun when Subei
Kangrun obtains a long-term loan of RMB 516,000,000.00 from Dunhuang Sub-branch of
Agricultural Development Bank of China by pledging its accounts receivable under the contract
in connection with the Mazongshan water supply PPP project, in Subei Mongol Autonomous
County, Gansu. The loan term is from 10 March 2020 to 9 March 2035.
⑨ Subsidiary Rushan Econ pledged its long-term accounts receivable with a book value of RMB
351,107,041.45 to obtain a long-term loan of RMB 115,810,000.00 from Yantai Economic
Development Zone Sub-branch of China Everbright Bank. The loan term is from 29 December
2016 to 28 December 2026, and the subsidiary Econ Technology provides joint liability
guarantee.
⑩ Subsidiary Dayi Kangrun Water obtained a long-term loan of RMB 188,700,000.00 from
Chengdu Qinglong Sub-branch of Industrial and Commercial Bank of China by pledging its right
to RMB 1,000,000,000.00 yields from the operation of the Dayi Industrial Sewage and Recycled
Water Treatment Plant under franchise. The loan term is from 29 April 2020 to 10 April 2035, and
the subsidiary Econ Technology provides a commitment letter of balance complement.
OCT Group, the parent of the Company, issued an entrusted loan of RMB 611,060,000.00 to
the Company through the China Merchants Bank. The loan term is from 12 November 2020 to 9
December 2022.
The company obtained a long-term loan of RMB 12,897,4612.32 from Shenzhen Branch of
Guangdong Huaxing Bank Co., Ltd. with the book value of RMB 187,546,621.37 and the right to
use state-owned construction land of RMB 13,735,772.90 as collateral. The loan term is from
April 12, 2019 to April 11, 2024.
Subsidiary Sichuan Konka obtain an entrusted borrowing of RMB 100,000,000.00 from
Sichuan Gangrong Investment Development Group Co., Ltd. under the pledge on the land use
right of subsidiary Yibin Konka Hi-Tech Industrial Park with a book value of RMB
274
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
13,532,751.06. The subsidiary Communication Technology provided joint liability guarantee for
the loan. The life of loan was from 8 May 2018 to 24 May 2025.
35. Bonds Payable
(1) List of Bonds Payable
Item Ending balance Beginning balance
Non-public offering corporate 4,993,212,788.32 4,987,709,643.64
bonds
Total 4,993,212,788.32 4,987,709,643.64
(2) Increase/Decrease of Bonds Payable
Bonds Issuing Dura Beginning
Total par value Issuing amount
name date tion balance
19Konka01 2+1
1,000,000,000.00 2019-1-14 996,500,000.00 997,798,742.17
(note ①) years
19Konka02
1,500,000,000.00 2019-1-14 3 1,494,750,000.00 1,496,698,113.21
(note ②)
19Konka03 2+1
500,000,000.00 2019-6-3 498,250,000.00 498,670,073.37
(note ③) years
19Konka04
500,000,000.00 2019-6-3 3 498,250,000.00 498,670,073.37
(note ④)
19Konka05 2+1
800,000,000.00 2019-7-22 797,200,000.00 797,798,742.14
(note ⑤) years
19Konka06
700,000,000.00 2019-7-22 3 697,550,000.00 698,073,899.38
(note ⑥)
Total 5,000,000,000.00 — — 4,982,500,000.00 4,987,709,643.64
(Continued)
Issued
Repay
during Amortizatio
during
Bonds the Withdraw interest n of
the Ending balance
name Reporti at face value premium
Reporting
ng and discount
Period
Period
275
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Issued
Repay
during Amortizatio
during
Bonds the Withdraw interest n of
the Ending balance
name Reporti at face value premium
Reporting
ng and discount
Period
Period
19Konka01
50,000,000.00 1,100,628.96 998,899,371.13
(note ①)
19Konka02
75,000,000.00 1,650,943.44 1,498,349,056.65
(note ②)
19Konka03
22,500,000.00 550,314.48 499,220,387.85
(note ③)
19Konka04
23,500,000.00 550,314.48 499,220,387.85
(note ④)
19Konka05
36,240,000.00 880,503.12 798,679,245.26
(note ⑤)
19Konka06
32,900,000.00 770,440.20 698,844,339.58
(note ⑥)
Total 240,140,000.00 5,503,144.68 4,993,212,788.32
Note 1: ① On 14 January 2019, RMB 1 billion of private placement corporate bonds was issued
with the duration of two plus one years, the annual interest rate of 5.00% and the due date of 14
January 2021.
② On 14 January 2019, RMB 1.5 billion of private placement corporate bonds was issued with
the duration of three years, the annual interest rate of 5.00% and the due date of 14 January 2022.
③ On 3 June 2019, RMB 0.5 billion of private placement corporate bonds was issued with the
duration of two plus one years, the annual interest rate of 4.50% and the due date of 3 June 2021.
④ On 15 January 2019, RMB 0.5 billion of private placement corporate bonds was issued with
the duration of three years, the annual interest rate of 4.70% and the due date of 3 June 2022.
⑤ On 22 July 2019, RMB 0.8 billion of private placement corporate bonds was issued with the
duration of two plus one years, the annual interest rate of 4.53% and the due date of 22 July 2021.
⑥ On 22 July 2019, RMB 0.7 billion of private placement corporate bonds was issued with the
duration of three years, the annual interest rate of 4.70% and the due date of 22 July 2022.
Note 2: OCT Group provided full-amount, unconditional and irrevocable joint and several
276
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
liability guarantee for the due payment of the private offering of corporate bonds.
36. Long-term Payables
Item Ending balance Beginning balance
Accrued financing lease outlay 921,958,930.55 519,416,941.74
Of which: unrecognized financing
expense 81,802,514.30 49,063,759.99
Less: Current portion 358,746,566.29 87,066,077.13
Total 481,409,849.96 383,287,104.62
37. Long-term Payroll Payable
Classification
Item Ending balance Beginning balance
Termination benefits-net liabilities of
defined contribution plans 5,248,309.14 5,565,646.72
Total 5,248,309.14 5,565,646.72
38. Provisions
Item Ending balance Beginning Reason for
balance formation
After-sales of
Product quality assurance 102,146,976.40 93,114,136.42 household
appliances
Others 206,591.51 206,591.51
Total 102,353,567.91 93,320,727.93
277
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
39. Deferred Income
(1) Category of Deferred Income
Item Beginning balance Increased Decreased Reason for
Ending balance
formation
Government Asset-related/i
subsidies 151,874,258.45 331,672,713.46 36,646,447.27 446,900,524.64
ncome related
Total
151,874,258.45 331,672,713.46 36,646,447.27 446,900,524.64
(2) Government subsidy
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
Subsidy for construction
of Yibin factory of Yibin 56,943,815.54 16,035,384.46 72,979,200.00 Asset-related
Konka Industrial Park
Subsidy for Dual HDR
OLED Smart TV R&D 13,300,000.00 13,300,000.00 Asset-related
and industrialization
278
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
project
Subsidy for the smart
TV industrial chain
10,860,500.00 4,494,000.00 6,366,500.00 Asset-related
project of Konka Group
Co., Ltd.
Operating subsidy for
Konka Zhifu Life
6,500,000.14 1,999,999.92 4,500,000.22 Asset-related
Science Innovation
Center project
Subsidy for Konka Yibin
Intelligent Terminal
6,000,000.00 6,000,000.00 Asset-related
Innovation Center
Incubation Project
Subsidy for 2017
Shenzhen Industrial
4,500,000.00 4,500,000.00 Asset-related
Chain Weak Links
Investment Project
Subsidy for supporting
the next-generation
Internet intelligent 3,798,349.54 1,981,747.56 1,816,601.98 Asset-related
terminal system
development and
279
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
production project
Subsidy for Konka smart
home cloud smart
2,896,000.04 2,896,000.04 Asset-related
control platform
construction project
Capital subsidy for
Shenzhen Economy and
Trade and
Informatization 2,550,000.00 1,276,000.02 1,273,999.98 Asset-related
Committee 2015
Shenzhen Industrial
Design Center
Subsidy for Konka
next-generation
multi-media terminal 2,500,000.10 999,999.96 1,500,000.14 Asset-related
technology engineering
lab project
Post grant for 2016
Industrial Enterprise
2,187,360.00 546,840.00 1,640,520.00 Asset-related
Technological
Renovation
Subsidy for 2,184,000.00 819,000.00 1,365,000.00 Asset-related
280
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
NB-IOT-based display
terminal smart factory
new model project
Subsidy for development
and industrialization of
digital products that are 2,080,000.04 519,999.96 1,560,000.08 Asset-related
collaborative and
connected
Subsidy for
next-generation
household multi-media
2,000,000.00 2,000,000.00 Asset-related
terminal technology
engineering lab
improvement project
Subsidy for 8K
equipment end-to-end
signal connection key
1,800,000.00 1,800,000.00 Asset-related
technology and terminal
display product R&D
project
Subsidy for vein R&D
1,750,000.00 1,750,000.00 Asset-related
center project
281
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
Specific subsidy for
mobile Internet
4th-generation mobile 1,734,662.37 412,490.04 1,322,172.33 Asset-related
communication
industrialization
Subsidy for IGRS-based
information terminal
1,400,000.00 1,400,000.00 Asset-related
R&D and
industrialization project
2017 provincial major
1,400,000.00 480,000.00 920,000.00 Asset-related
specific subsidy
Subsidy for big data
mining-based user
operation system R&D 1,320,000.00 1,320,000.00 Asset-related
and industrialization
project
Subsidy for
AVS/DRA-based
1,311,333.18 1,311,333.18 Asset-related
terminal and supporting
core chip R&D project
Subsidy for true
1,277,999.98 284,000.04 993,999.94 Asset-related
three-dimensional video
282
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
continual view point
real-time integration and
advance testing project
Subsidy for module
whole-machine 1,275,000.00 300,000.00 975,000.00 Asset-related
integration project
Subsidy for mobile
intelligent terminal new
application service 1,265,783.60 727,279.92 538,503.68 Asset-related
system R&D and
industrialization project
Subsidy for special
decoration of Huiqi
flagship store of
Shenzhen International 1,200,000.00 1,200,000.00 Asset-related
Consumer Electronics
Exchange/Exhibition
Center Co., Ltd.
Specific subsidy for
Dongguan Fiscal
1,200,000.00 600,000.00 600,000.00 Asset-related
Provincial-level strategic
emerging industries
283
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
Subsidy for super-short
focus laser projecting 1,075,000.00 935,000.00 140,000.00 Asset-related
smart TV R&D project
Subsidy for built-in
operation system for TV 1,033,110.10 459,159.96 573,950.14 Asset-related
application R&D project
Subsidy for secure and
reliable chip-based
1,000,000.00 1,000,000.00 Asset-related
satellite ground receiver
project
Central infrastructure
investment budgetary
1,000,000.00 1,000,000.00 Asset-related
subsidy for preliminary
work of PPP project
2016 Guangdong
Province enterprise
research and 916,879.90 229,217.73 687,662.17 Asset-related
development provincial
fiscal subsidy
2010-2012 industrial
840,000.00 420,000.00 420,000.00 Asset-related
technology specific
284
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
subsidy
Subsidy for mobile
intelligent terminal
information security 835,187.04 480,000.00 355,187.04 Asset-related
system key technology
R&D project
Specific subsidy for
799,999.80 200,000.04 599,999.76 Asset-related
business restructuring
2018 Anhui Province
780,000.00 180,000.00 600,000.00 Asset-related
robotics specific subsidy
Subsidy for dual-channel
new 3D smart TV R&D
778,166.79 405,999.96 372,166.83 Asset-related
and industrialization
project
Post fiscal subsidy for
2016 industrial
733,480.08 183,369.96 550,110.12 Asset-related
enterprise technological
renovation
Subsidy for multiple
view point 675,000.00 300,000.00 375,000.00 Asset-related
high-definition nuke-eye
285
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
3D smart LCD TV
project
Subsidy for new
man-machine interaction
525,689.15 525,689.15 Asset-related
smart TV R&D and
industrialization project
Subsidy for
three-networks
integration smart TV and 266,666.84 266,666.84 Asset-related
system support platform
project
Anhui Province
Technology Office R&D 176,250.00 45,000.00 131,250.00 Asset-related
devices subsidy
Subsidy for 3D TV
terminal development
108,333.15 108,333.15 Asset-related
and industrialization
project
Supporting fund for
Income-relate
Suining Konka 229,420,000.00 229,420,000.00
d
Industrial Park
286
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
Special government
Income-relate
grants for Tongchuan 30,000,000.00 30,000,000.00
d
Project
(CCTV 2) 8K UHD
display chip R&D and 20,000,000.00 20,000,000.00 Asset-related
industrialization project
Subsidy for return of the
land in Konka
19,440,000.00 327,272.73 19,112,727.27 Asset-related
Chongqing Industrial
Park
NB-IOT-based display
terminal smart factory 4,095,000.00 682,500.00 3,412,500.00 Asset-related
new model
Subsidy for cost of
Wuzhen Konka
3,000,000.00 3,000,000.00 Asset-related
digitalization of physical
spaces
Subsidy for new
equipment purchased by 2,133,169.00 2,133,169.00 Asset-related
Sichuan Konka
Special subsidy for 1,546,519.00 71,650.28 1,474,868.72 Asset-related
287
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
quality development
(technical upgrading) for
Tongchuang
Grant for major
provincial science &
1,500,000.00 25,000.00 1,475,000.00 Asset-related
technology programs at
Anhui Konka
Subsidy for new
equipment purchased by
Yibin Yanjiang
1,215,523.00 230,208.29 985,314.71 Asset-related
Construction Investment
& Development Co.,
Ltd.
Subsidy for municipal
technological upgrading
668,700.00 5,814.79 662,885.21 Asset-related
program at Dongguan
Konka
288
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount
charged to Amount charged
List of Government Beginning New amount in Other Asset/income
non-operating to other income Ending balance
Subsidy balance the period changes -related
income in the in the period
period
Z20200104 5G Smart
TV key technologies 600,000.00 600,000.00 Asset-related
R&D project
Basic construction fund
of Suining Industrial 500,000.00 500,000.00 Asset-related
Park
Equipment subsidy for
Anhui Konka technical 490,000.00 98,000.04 391,999.96 Asset-related
upgrading project
Municipal technological
breakthrough project at 400,000.00 20,000.01 379,999.99 Asset-related
Anhui Konka
Other asset-related
5,095,691.07 628,418.00 2,598,873.70 3,125,235.37 Asset-related
government subsidies
Total 151,874,258.45 331,672,713.46 36,646,447.27 446,900,524.64
289
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
40. Other non-current liabilities
Item Ending balance Beginning balance
Contract obligations over one year 106,475,449.02 117,318,235.28
Total 106,475,449.02 117,318,235.28
41. Share capital
Increase/decrease (+/-)
Bo Bonus
New Sub
Item Beginning balance nus issue Oth Ending balance
shares tota
sha from ers
issued l
res profit
Total
2,407,945,408.00 2,407,945,408.00
shares
Total 2,407,945,408.00 2,407,945,408.00
42. Capital Reserves
Item Beginning balance Increased Decreased Ending balance
Other capital 183,267.00 230,185,310.09
230,368,577.09
reserves
Total 230,368,577.09 183,267.00 230,185,310.09
Note: The other capital reserves decreased by RMB 183,267.00 due to the disposal of Zhuhai
Jinsu Plastic Co., Ltd., an associate of the Company.
290
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
43. Other Comprehensive Income
Reporting Period
Less: Less: Recorded
Recorded in in other
other comprehensive
comprehensiv income in prior
Attributable to
e income in period and Less: Attributable to
Beginning Income before owners of the
Item prior period transferred in Income non-controlling Ending balance
balance taxation in the Company as
and retained tax interests after
Current Period the parent after
transferred in earnings in the expense tax
tax
profit or loss Current Period
in the
Current
Period
I. Items that will not
be reclassified to profit -9,652,181.00 1,701,121.80 -1,628,195.00 3,253,302.80 76,014.00 -6,398,878.20
or loss
Changes in fair
value of other equity -9,652,181.00 1,701,121.80 -1,628,195.00 3,253,302.80 76,014.00 -6,398,878.20
instrument investment
Others
II. Items that will be
reclassified to profit or -11,640,922.52 -4,501,482.44 1,456,758.30 -5,958,240.74 -10,184,164.22
loss
291
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period
Less: Less: Recorded
Recorded in in other
other comprehensive
comprehensiv income in prior
Attributable to
e income in period and Less: Attributable to
Beginning Income before owners of the
Item prior period transferred in Income non-controlling Ending balance
balance taxation in the Company as
and retained tax interests after
Current Period the parent after
transferred in earnings in the expense tax
tax
profit or loss Current Period
in the
Current
Period
Of which: Other
comprehensive income
that will be reclassified -2,397,350.96 -2,397,350.96
to profit or loss under
the equity method
Differences arising
from the translation of
foreign currency -9,243,571.56 -4,501,482.44 1,456,758.30 -5,958,240.74 -7,786,813.26
denominated financial
statements
Total Other
-21,293,103.52 -2,800,360.64 -1,628,195.00 4,710,061.10 -5,882,226.74 -16,583,042.42
Comprehensive
292
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period
Less: Less: Recorded
Recorded in in other
other comprehensive
comprehensiv income in prior
Attributable to
e income in period and Less: Attributable to
Beginning Income before owners of the
Item prior period transferred in Income non-controlling Ending balance
balance taxation in the Company as
and retained tax interests after
Current Period the parent after
transferred in earnings in the expense tax
tax
profit or loss Current Period
in the
Current
Period
Income
293
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
44. Surplus Reserves
Item Beginning balance Increased Decreased Ending balance
Statutory
973,502,519.62 973,502,519.62
surplus reserves
Discretional
238,218,590.05 238,218,590.05
surplus reserves
Total 1,211,721,109.67 1,211,721,109.67
45. Retained Earnings
Item Reporting Period Same period of last
year
Ending balance of last year 4,239,763,606.89 4,271,408,192.21
Add: Total beginning balance of retained earnings
before adjustments
Of which: change of accounting policy -2,884,254.62
Other adjustment factors
Beginning balance of the Reporting Period 4,239,763,606.89 4,268,523,937.59
Add: Net profit attributable to owners of the
477,633,250.14 212,034,210.08
Company as the parent
Retained incomes carried forward from other
-1,628,195.00
comprehensive income
Less: Withdrawal of statutory surplus reserves
Withdrawal of discretional surplus reserves
Dividend of ordinary shares payable 120,397,270.40 240,794,540.78
Ending balance of this year 4,595,371,391.63 4,239,763,606.89
46. Operating Revenue and Cost of Sales
(1) Operating Revenue and Cost of Sales
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main
49,869,938,568.55 47,324,236,629.26 54,571,250,596.51 51,874,875,221.16
operations
294
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Reporting Period Same period of last year
Other
481,897,986.32 270,827,720.72 547,874,882.21 263,323,279.88
operations
Total 50,351,836,554.87 47,595,064,349.98 55,119,125,478.72 52,138,198,501.04
(2) Deduction from Operating Revenue
Reporting Period Same period of last
Item Remark
year
Operating Revenue 50,351,836,554.87 55,119,125,478.72
Deduction items of
56,103,050.39 31,986,803.24
operating revenue
Of which: sales Unrelated to the main
30,676,771.37 13,628,880.00
revenue from waste business
Water and electricity fees,
loading and unloading
Other 25,426,279.02 18,357,923.24 fees and other are
unrelated to the main
business
Subtotal of income
from business
56,103,050.39 31,986,803.24
unrelated to the main
business
Subtotal of income
without commercial None
substance
Operating revenue
50,295,733,504.48 55,087,138,675.48
after deduction
(3) Main Operations (Classified by product)
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Supply
chain 30,483,602,365.87 30,183,532,940.90 32,744,925,411.86 32,376,857,384.01
trading
295
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
business
Color TV
7,519,625,331.33 6,925,658,808.00 8,765,607,417.92 8,005,508,211.90
business
Environme
ntal
4,823,779,902.39 4,097,138,754.02 7,079,397,665.91 6,379,216,880.51
protection
business
Consumer
appliances 3,842,051,456.02 3,317,107,750.97 3,829,318,820.56 3,299,314,084.65
business
Semi-cond
uctor 282,969,230.63 275,286,437.09
business
Others 2,917,910,282.31 2,525,511,938.28 2,152,001,280.26 1,813,978,660.09
Total 49,869,938,568.55 47,324,236,629.26 54,571,250,596.51 51,874,875,221.16
(4) Information on the transaction price allocated to the remaining performance obligation
The income corresponding to the performance obligations signed at the end of the year but not yet
fulfilled or not completed is 2,914,470,639.31 yuan, of which, 2,474,070,687.55 yuan is expected
to recognize revenue in 2021, 376,489,946.62yuan is expected to recognize revenue in 2022, and
63,910,005.14yuan is expected to recognize revenue in 2023.
47. Taxes and Surtaxes
Item Reporting Period Same period of last year
Stamp duty 25,112,454.61 22,123,062.33
Urban maintenance and
21,225,457.65 26,917,643.05
construction tax
Land use tax 17,657,115.79 17,468,778.99
Property tax 13,264,477.94 15,307,845.93
Education surcharge 9,423,102.41 12,222,254.16
296
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Reporting Period Same period of last year
Local education surcharge 6,341,838.85 8,143,404.48
VAT of land 1,072,685.63 3,071,897.09
Water resources fund 766,504.35 758,046.72
Others 2,372,230.08 3,838,898.36
Total 97,235,867.31 109,851,831.11
48. Selling Expense
Item Reporting Period Same period of last year
Payroll 410,820,148.47 587,024,261.02
Advertising expense 405,038,820.57 459,598,430.49
Logistic Fee 395,728,038.37 406,337,281.28
Promotional activities 199,811,766.50 299,435,084.44
Warranty fee 186,239,759.56 197,180,754.12
Taxes and fund 58,646,916.00 53,068,717.14
Business travel charges 18,952,238.58 38,355,711.50
Rental charges 18,695,062.27 20,839,323.65
Exhibition expenses 17,841,836.83 46,248,959.80
Business entertainment expenses 13,710,892.65 19,360,409.81
Others 100,141,324.47 175,683,798.81
Total 1,825,626,804.27 2,303,132,732.06
49. Administrative Expense
Item Reporting Period Same period of last year
Payroll 524,488,419.75 485,140,844.16
Depreciation charge 147,324,296.40 101,216,934.52
Intermediary fees 100,879,921.97 45,022,285.82
Business travel charges 14,489,183.36 21,665,580.27
Patent fee 38,863,726.67 16,457,657.10
Loss on scraping of
5,515,711.35 11,955,696.11
inventories
Water & electricity fees 11,737,097.44 12,761,543.31
Others 179,683,586.40 162,308,786.33
Total 1,022,981,943.34 856,529,327.62
50. R&D Expense
297
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Reporting Period Same period of last year
Salary 297,465,065.33 197,406,785.63
Material drawing out 120,181,005.28 104,755,285.94
Expenses on trial production of
new products 116,276,268.41 88,111,358.93
Commission service charge 32,833,667.49 41,462,134.39
Depreciation and amortization 23,530,284.84 12,437,250.53
Information charges 14,229,413.16 11,747,617.21
Testing fees 9,552,419.94 5,812,646.23
Others 67,810,487.20 38,867,023.37
Total 681,878,611.65 500,600,102.23
51. Finance Costs
Item Reporting Period Same period of last year
Interest expense 979,223,522.98 1,031,068,425.69
Less: Interest income 164,580,939.30 247,559,600.76
Add: Exchange loss 220,044,519.70 -67,740,367.81
Other 56,922,864.38 60,120,356.02
Total 1,091,609,967.76 775,888,813.14
52. Other Income
Item Reporting Period Same period of last year
Support fund 566,075,801.50 967,721,870.00
Rewards and subsidies 247,663,680.35 156,190,460.00
Transfer of deferred income 36,646,447.27 31,183,437.20
Software tax rebates 30,710,313.50 39,348,087.93
Post subsidies 21,703,015.11 19,185,216.90
L/C export subsidy 5,555,574.57 3,560,576.00
Land tax rebates 15,955,706.27 10,906,489.80
Others 4,622,989.46 1,078,696.50
Total 928,933,528.03 1,229,174,834.33
298
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
53. Investment Income
Item Reporting Period Same period of
last year
Long-term equity investment income measured
104,288,418.75 141,264,035.96
by equity method
Investment income from disposal of long-term
1,343,712,485.37 569,444,481.69
equity investment
Investment income from holding of
4,800,000.00 2,330,000.00
held-for-trading financial assets
Investment income from disposal of
3,405,333.03 -10,285,883.02
held-for-trading financial assets
Income from remeasurement of residual stock
885,804,841.25 342,337,346.63
rights at fair value after losing control power
Interest income from holding of debt
68,621,917.82 60,433,679.86
investments
Income from entrusted wealth management,
21,221,916.72 73,534,655.05
entrusted loans
Investment income adjusted due to unrealized
1,081,111.64 4,322,774.22
profits generated from upstream transactions
Investment income from disposal of financial
399,980.27
assets at fair value through current profit or loss
Total 2,433,336,004.85 1,183,381,090.39
54. Gain on Changes in Fair Value
Sources Reporting Period Same period of
last year
Trading financial assets 19,089,541.66
Of which: gain on changes in fair value of
derivative financial instruments
Trading financial liabilities -3,005,381.67
Total 19,089,541.66 -3,005,381.67
55. Credit Impairment Loss
299
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Reporting Period Same period of last year
Loss on bad debts of notes
-24,930,991.28 -4,306,077.35
receivable
Bad debt losses of accounts
-444,069,685.68 -339,398,520.50
receivable
Bad debt losses of other
-258,255,844.49 -183,525,075.35
receivables
Bad debt loss of prepayment 4,880,671.30 -4,649,595.56
Total -722,375,850.15 -531,879,268.76
56. Asset Impairment Loss
Item Reporting Period Same period of last year
Inventory depreciation loss and
contract performance cost -172,812,626.21 -197,576,487.91
impairment loss
Contractual Asset Impairment
-146,807,263.10
Loss
Impairment loss on long-term
-38,375,298.75 -29,028,300.57
equity investment
Impairment loss on fixed assets -947,487.17
Impairment loss on goodwill -103,464,423.24 -76,431,127.34
Total -462,407,098.47 -303,035,915.82
57. Asset Disposal Income (“－” for loss)
Amount recorded
Same period of in the current
Item Reporting Period
last year non-recurring
profit or loss
Incomes from disposal of
disposal groups held for sale
Incomes from disposal of
206,315,700.34 293,706,640.64 206,315,700.34
non-current assets
Including: incomes from 206,315,700.34 293,706,640.64 206,315,700.34
300
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount recorded
Same period of in the current
Item Reporting Period
last year non-recurring
profit or loss
disposal of non-current assets
not classified as the
held-for-sale assets
Of which: Fixed assets
19,882,250.97 199,562,396.99 19,882,250.97
disposal income
Intangible assets
186,433,449.37 94,144,243.65 186,433,449.37
disposal income
Total 206,315,700.34 293,706,640.64 206,315,700.34
58. Non-operating Income
（1） List of Non-operating Income
Amount recorded
Same Period of in the current
Item Reporting Period
last year non-recurring
profit or loss
Insurance indemnity 74,801,658.73
Non-current assets damage
1,076,972.21 1,076,972.21
and retirement gains
Compensation and penalty
55,750,466.90 41,951,152.92 55,750,466.90
income
Government subsidies
unrelated to the normal 10,322,986.31 14,692,600.00 10,322,986.31
operation of the Company
Gains on debt restructuring 6,030,592.00 14,536,434.36 6,030,592.00
Other 13,945,777.99 19,861,542.93 13,945,777.99
Total 87,126,795.41 165,843,388.94 87,126,795.41
（2） Of which, government subsidies recorded into current profit or loss:
301
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Distribution entity Distribution reason Nature
Project subsidy of
Chuzhou Tongsheng Subsidy for participating in Chuzhou
Chuzhou Huike intelligent
Investment Huike intelligent appliance industry Subsidy
appliance industry
Development Co., Ltd. investment
investment
Chuzhou Tongsheng Subsidy obtained for removal to
Subsidy of removal of
Investment establishing Intelligent Appliances and Subsidy
Anhui Konka Zhilian
Development Co., Ltd. Equipment Industrial Park
Subsidies for placement of VAT relief for the placement of retired
Subsidy
retired soldiers soldiers
Total
(continued)
Whether
subsidies
influence Special Related to
Reporting Same Period of
Item the current subsidy or assets/relate
Period last year
profits and not d to income
losses or
not
Project
subsidy of
Chuzhou
Huike Related to
Not Not 10,136,986.31 9,692,600.00
intelligent income
appliance
industry
investment
Subsidy of
removal of Related to
Not Not 5,000,000.00
Anhui Konka income
Zhilian
Subsidies for
Related to
placement of Not Not 186,000.00
income
retired
302
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Whether
subsidies
influence Special Related to
Reporting Same Period of
Item the current subsidy or assets/relate
Period last year
profits and not d to income
losses or
not
soldiers
Total 10,322,986.31 14,692,600.00
59. Non-operating Expense
Amount
recorded into the
Same Period of last
Item Reporting Period current
year
non-recurring
profit or loss
Losses on damage and
scraping of non-current 5,261,743.91 4,445,790.35 5,261,743.91
assets
Compensation expense 12,762,989.57 9,631,943.32 12,762,989.57
Donations 7,565,741.38 4,455,618.74 7,565,741.38
Total 25,590,474.86 18,533,352.41 25,590,474.86
60. Income Tax Expense
（1） Lists of Income Tax Expense
Item Reporting Period Same period of
last year
Current income tax expense 259,865,247.09 514,367,217.82
Deferred income tax expense -298,071,552.16 -398,727,126.00
Total -38,206,305.07 115,640,091.82
（2） Adjustment Process of Accounting Profit and Income Tax Expense
Item Reporting Period
303
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Reporting Period
Profit before taxation 501,867,157.37
Current income tax expense accounted at
125,466,789.34
statutory/applicable tax rate
Influence of applying different tax rates by subsidiaries -23,762,554.65
Influence of income tax before adjustment -927,927.53
Influence of non-taxable income -277,877,836.51
Influence of not deductable costs, expenses and losses 42,085,079.82
Influence of deductable loss of unrecognized deferred
-31,774,540.17
income tax assets in prior period
Influence of deductable temporary difference or deductable
losses of unrecognized deferred income tax in the Reporting 173,029,456.41
Period
Changes in the balance of deferred income tax assets/
-319,183.21
liabilities in previous period due to adjustment of tax rate
Other -44,125,588.57
Income tax expense -38,206,305.07
61. Other Comprehensive Income
Refer to “Note VI-43. Other Comprehensive Income” for details.
62. Cash Flow Statement
（1） Cash Generated from/Used in Other Operating/Investing/Financing Activities
1） Cash Generated from Other Operating Activities
Same Period of last
Item Reporting Period
year
Commercial factoring accounts received 701,570,000.00 1,350,090,436.53
Intercourse funds 737,849,254.12 88,274,570.49
Income from government subsidy 1,171,789,839.65 1,253,240,751.45
Front money and guarantee deposit 1,343,399,027.31 1,164,255,729.60
Interest income from bank deposits 43,947,377.51 31,706,637.33
304
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Same Period of last
Item Reporting Period
year
Compensation of suppliers 56,949,337.80 24,896,023.45
Other 168,111,950.02 98,551,896.43
Total 4,223,616,786.41 4,011,016,045.28
2） Cash Used in Other Operating Activities
Same Period of last
Item Reporting Period
year
The commercial factoring payment (Note) 700,000,000.00 955,963,886.78
Expense for cash payment 1,396,622,206.87 1,529,577,152.08
Payment made on behalf 24,937,901.55 30,691,357.02
Payment for guarantee deposit, cash
807,211,303.53 1,019,583,946.33
deposit
Expense for bank handling charges 26,997,496.86 37,748,563.79
Energy conversation subsidy returned 89,960,000.00
Other 509,182,248.35 275,060,717.61
Total 3,464,951,157.16 3,938,585,623.61
3） Cash Generated from Other Investing Activities
Same Period of last
Item Reporting Period
year
Recovery of financial products 531,953,067.30 454,850,000.00
Recovery of entrusted loans 1,669,305,006.07 1,268,950,000.00
Other 521,000,071.70 361,869,168.69
Total 2,722,258,145.07 2,085,669,168.69
4） Cash Used in Other Investing Activities
Same Period of last
Item Reporting Period
year
Purchase of financial products 639,160,000.00 1,020,737,610.69
Payment for entrusted loans 375,578,000.00
305
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Same Period of last
Item Reporting Period
year
Other 342,199,320.83 507,903,146.78
Total 1,356,937,320.83 1,528,640,757.47
5） Cash Generated from Other Financing Activities
Same Period of last
Item Reporting Period
year
Recovery of margin deposit pledged 1,139,622,285.43 601,239,942.14
Finance lease 659,602,970.00 417,095,790.00
Receiving entrusted loans 955,993,888.99 807,263,000.00
Total 2,755,219,144.42 1,825,598,732.14
6） Cash Used in Other Financing Activities
Same Period of last
Item Reporting Period
year
Deposit as margin for pledge 1,116,447,153.50 1,154,091,959.94
Repayment of entrusted loans 266,946,710.52 71,200,000.00
Finance lease 346,079,008.76 275,515,872.11
Financing expense 31,573,001.17 29,297,829.55
Other 213,638,809.72 93,037,101.26
Total 1,974,684,683.67 1,623,142,762.86
（2） Supplemental Information for Cash Flow Statement
Reporting Period Same period of
Supplemental information
last year
1. Reconciliation of net profit to net cash flows
generated from operating activities
Net profit 540,073,462.44 334,936,115.34
Add: Provision for impairment of assets 462,407,098.47 303,035,915.82
Credit impairment loss 722,375,850.15 531,879,268.76
Depreciation of fixed assets, oil-gas assets, and 319,151,539.89 256,657,385.35
306
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period Same period of
Supplemental information
last year
productive living assets
Amortization of intangible assets 78,424,382.89 63,777,612.08
Amortization of long-term prepaid expenses 87,717,664.64 89,040,814.19
Losses on disposal of fixed assets, intangible
assets and other long-lived assets (gains: -206,315,700.34 -293,706,640.64
negative)
Losses on scrap of fixed assets (gains:
4,184,771.70 3,087,048.55
negative)
Losses on changes in fair value (gains: negative) -19,089,541.66 3,005,381.67
Finance costs (gains: negative) 893,158,757.67 837,555,538.04
Investment loss (gains: negative) -2,433,336,004.8 -1,183,381,090.39
5
Decrease in deferred income tax assets (gains:
-278,153,255.22 -354,179,532.93
negative)
Increase in deferred income tax liabilities (“-”
-19,647,864.12 -45,502,532.99
means decrease)
Decrease in inventories (gains: negative) 623,886,945.84 -88,405,617.33
Decrease in accounts receivable generated from
-2,928,968,789.7 -1,524,655,193.77
operating activities (gains: negative)
9
Increase in accounts payable used in operating
-445,715,482.41
activities (decrease: negative) 2,369,393,657.77
Other -36,646,447.27 -31,376,273.93
Net cash generated from/used in operating
178,616,528.21 -1,543,947,284.59
activities
2. Significant investing and financing activities
without involvement of cash receipts and
payments
Transfer of debt to capital
Current portion of convertible corporate bonds
307
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Reporting Period Same period of
Supplemental information
last year
Fixed assets leased in by financing
3. Net increase/decrease of cash and cash
equivalent:
Ending balance of cash 4,298,056,113.24 4,493,701,917.22
Less: beginning balance of cash 4,493,701,917.22 3,434,149,481.72
Add: Ending balance of cash equivalents
Less: Beginning balance of cash equivalents
Net increase in cash and cash equivalents -195,645,803.98 1,059,552,435.50
（3） Net Cash Receive from Disposal of the Subsidiaries
Item Amount
Cash or cash equivalents received in the Reporting Period from
911,058,150.00
disposal of subsidiaries in the Current Period
Of which: Dongguan Konka Investment 586,500,000.00
Chuzhou Kangxin 194,820,000.00
E3info 28,000,000.00
Chongqing Konka Real Estate 27,000,000.00
Chongqing Chengda 15,930,000.00
Morsemi 2,100,000.00
Zhongshan Kangao 56,000,000.00
Chengdu Konka Incubator 600,000.00
Konka Cross-Border Technological Innovation 108,150.00
Less: cash and cash equivalents held by subsidiaries on the date of
37,290,851.97
losing control power
Of which: Dongguan Konka Investment 2,285,772.79
Chuzhou Kangxin 3,317,421.35
E3info 24,712,706.14
Chongqing Konka Real Estate 326,803.37
Chongqing Chengda 138,308.59
308
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Amount
Morsemi 981,084.01
Zhongshan Kangao 5,505,972.10
Chengdu Konka Incubator 8,878.67
Konka Cross-Border Technological Innovation 13,904.95
Add: Cash or cash equivalents received in the Reporting Period from
disposal of subsidiaries in the prior period
Net cash received from disposal of subsidiaries 873,767,298.03
（4） Cash and Cash Equivalents
Item Ending balance Beginning balance
Cash 4,298,056,113.24 4,493,701,917.22
Including: Cash on hand 16,052.88 18,699.99
Bank deposit on demand 4,298,040,060.36 4,493,683,217.23
Ending balance of cash and cash
4,298,056,113.24 4,493,701,917.22
equivalents
63. Items in the Statement of Changes in Shareholders' Equity
There is no “other” amount to adjust the amount at the end of the previous year in this
period.
64. Assets with Restricted Ownership or Right to Use
Item Ending carrying value Reason for restriction
Among them, RMB1,067,872,557.16 is margin deposit,
pledge is used for borrowing or issuing bank acceptance
bill, RMB37,701,403.94 is financial supervision account
Monetary assets 1,133,474,067.66
fund; RMB20,903,555.17 is fixed deposit that can not be
withdrawn in advance; RMB6,996,551.39 is restricted due
to other reasons.
Held-for-trading Structural deposits
599,160,000.00
financial assets
The company pledged bank acceptance bills with a book
Notes receivable 784,732,739.73
value of RMB 784,732,739.73 for comprehensive
309
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Ending carrying value Reason for restriction
financing services such as issuing bank acceptance bills,
letters of credit, guarantees, and trade finance.
Investment property 131,321,568.34 For mortgage loan
Fixed assets 768,741,766.12 Used for mortgage loan, finance lease and guarantee.
Construction in
328,756,028.19 For mortgage loan
progress
Intangible assets 193,755,559.74 For mortgage loan
Long-term
351,107,041.45 For pledge loan
receivables
Total 4,291,048,771.23
65. Foreign Currency Monetary Items
（1） Foreign Currency Monetary Items
Ending foreign Exchange Ending balance converted to
Item
currency balance rate RMB
Monetary assets
Of which: USD 95,989,561.32 6.5249 626,322,288.66
EUR 12,845.44 8.0250 103,084.66
EGP 1,013,290.04 0.4159 421,427.33
HKD 14,902,253.81 0.8416 12,541,736.81
PLN 854,889.37 1.7519 1,497,680.69
Accounts receivable
Of which: USD 132,221,173.92 6.5249 862,729,937.71
EGP 4,887,951.32 0.4159 2,032,898.95
GBP 564,195.30 8.8903 5,015,865.48
HKD 33,361,549.15 0.8416 28,077,079.76
Other receivables
310
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending foreign Exchange Ending balance converted to
Item
currency balance rate RMB
Of which: USD 135,938,277.17 6.5249 886,983,664.71
EGP 5,519,421.05 0.4159 2,295,527.21
HKD 1,515,079.53 0.8416 1,275,090.93
Short-term
borrowings
Of which: USD 59,159,714.38 6.5249 386,011,220.36
Accounts payable
Of which: USD 42,417,352.11 6.5249 276,768,980.78
EUR 7,752.00 8.0250 62,209.80
HKD 13,378,276.37 0.8416 11,259,157.39
Other payables
Of which: EUR 40,359.30 8.0250 323,883.38
EGP 735,934.30 0.4159 306,075.08
HKD 23,661,059.12 0.8416 19,913,147.36
Interest payable
Of which: USD 99,200.24 6.5249 647,271.65
（2） Notes to Overseas Entities
The significant overseas entities include Hong Kong Konka, Konka Electrical Appliances
International Trading, Chain Kingdom Memory Technologies, Kangjietong and Jiali International.
The main overseas operating place is Hong Kong. The Company’s recording currency is HKD
since the main currency in circulation in Hong Kong is HKD.
66. Government Subsidy
（1） Basic Information on Government Subsidy
311
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount recorded
Category Amount Listed items in the current
profit or loss
Supporting fund of
530,000,000.00 Other income 530,000,000.00
Chongqing Bishan project
Supporting fund of Suining
Deferred income/Other
Konka Industrial Park Suining 245,972,074.00 16,552,074.00
income
project
Rewards and subsidies 247,663,680.35 Other income 247,663,680.35
Tax rebates on software 30,710,313.50 Other income 30,710,313.50
Post subsidies 21,703,015.11 Other income 21,703,015.11
(Central 2) 8K Ultra HD
Display Chip R&D and 20,000,000.00 Deferred income
Industrialization Project
Chongqing Konka Land
19,440,000.00 Deferred income 327,272.73
Compensation Fund
Support Fund of Konka
Semiconductor Chip 17,767,345.50 Other income 17,767,345.50
Packaging and Testing Project
Subsidy of plant construction
of Yibin Konka Industrial 16,035,384.46 Deferred income
Park project
Subsidies for L/C exports 5,555,574.57 Other income 5,555,574.57
Land tax rebates 15,955,706.27 Other income 15,955,706.27
Supporting fund of Yibin
1,756,382.00 Other income 1,756,382.00
Konka Industrial Park project
Deferred income/Other
income/Non-operating
Other 67,265,387.77 15,790,648.48
income/Financial
expenses
Total 1,239,824,863.53 902,937,339.80
（2） Return of Government Subsidy
312
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
No such cases in the Reporting Period.
313
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
VII. Changes of Consolidation Scope
1. Disposal of subsidiary
The differences of enjoyed
net assets share of the
Equity subsidiary in
Method of
Name of the The equity disposal Time of losing Recognition basis for the time of corresponding
equity
subsidiary disposal price proportion control losing control power consolidated statements
disposal
(%) of the disposal price and
the disposal investment
(RMB’0,000)
The rights and obligations related to
Dongguan Konka
58,650.00 51.00 Transfer 2020/9/25 the underlying equity have been 66,661.40
Investment
transferred
The rights and obligations related to
Chuzhou Kangxin 19,482.00 51.00 Transfer 2020/12/21 the underlying equity have been 17,951.56
transferred
The rights and obligations related to
E3info 2,800.00 20.00 Transfer 2020/11/25 the underlying equity have been 1,238.41
transferred
Chongqing Konka Real The rights and obligations related to
2,700.00 18.00 Transfer 2020/11/25 1,839.35
Estate the underlying equity have been
314
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The differences of enjoyed
net assets share of the
Equity subsidiary in
Method of
Name of the The equity disposal Time of losing Recognition basis for the time of corresponding
equity
subsidiary disposal price proportion control losing control power consolidated statements
disposal
(%) of the disposal price and
the disposal investment
(RMB’0,000)
transferred
The rights and obligations related to
Chongqing Chengda 1,593.00 18.00 Transfer 2020/12/24 the underlying equity have been 846.56
transferred
The rights and obligations related to
Morsemi 210.00 21.00 Transfer 2020/8/30 the underlying equity have been 167.70
transferred
The rights and obligations related to
Zhongshan Kangao 5,600.00 100.00 Transfer 2020/12/15 the underlying equity have been 1,110.47
transferred
The rights and obligations related to
Chengdu Konka
60.00 70.00 Transfer 2020/12/22 the underlying equity have been 108.24
Incubator
transferred
315
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The differences of enjoyed
net assets share of the
Equity subsidiary in
Method of
Name of the The equity disposal Time of losing Recognition basis for the time of corresponding
equity
subsidiary disposal price proportion control losing control power consolidated statements
disposal
(%) of the disposal price and
the disposal investment
(RMB’0,000)
Konka Cross-Border The rights and obligations related to
Technological 10.82 21.00 Transfer 2020/12/22 the underlying equity have been 10.21
Innovation transferred
(Continued)
Residual Carrying value Recognition method Amount of other
Fair value of
equity of residual equity Gains or losses from and main assumption comprehensive income
residual equity on
Name of the proportion on on the date of re-measurement of of fair value of related to former
the date of losing
subsidiary the date of losing control residual equity at fair residual equity on the subsidiaries transferred
control power
losing control power value (RMB’0,000) date of losing control into investment profit or
(RMB’0,000)
power (%) (RMB’0,000) power loss (RMB’0,000)
Dongguan Konka
49.00 4,215.78 56,350.00 52,134.22 Evaluated price
Investment
Chuzhou Kangxin 49.00 1,470.45 18,718.00 17,247.55 Evaluated price
316
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Residual Carrying value Recognition method Amount of other
Fair value of
equity of residual equity Gains or losses from and main assumption comprehensive income
residual equity on
Name of the proportion on on the date of re-measurement of of fair value of related to former
the date of losing
subsidiary the date of losing control residual equity at fair residual equity on the subsidiaries transferred
control power
losing control power value (RMB’0,000) date of losing control into investment profit or
(RMB’0,000)
power (%) (RMB’0,000) power loss (RMB’0,000)
E3info 40.00 3,123.19 5,197.93 2,074.74 Evaluated price
Chongqing Konka
33.00 1,577.86 4,950.00 3,372.14 Evaluated price
Real Estate
Chongqing Chengda 33.00 1,368.48 2,920.50 1,552.02 Evaluated price
Morsemi 30.00 60.43 300.00 239.57 Evaluated price
Zhongshan Kangao Evaluated price
Chengdu Konka
30.00 -20.67 25.47 46.14 Evaluated price
Incubator
Konka Cross-Border
Technological 30.00 0.86 1.90 1.04 Evaluated price
Innovation
317
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. Changes in Combination Scope for Other Reasons
（1）Subsidiaries Established by the Company in 2020
Time and place
Shareholding Method of
Name Registered capital of obtaining
percentage (%) obtaining
control power
Newly
Suining Konka Intelligent 100,000,000.00 100.00 2020/12/21
established
Newly
Frestec Smart Home 50,000,000.00 51.00 2020/8/26
established
Newly
Jiangsu Konka Intelligent 120,000,000.00 51.00 2020/9/11
established
Liaoyang Kangshun Newly
10,000,000.00 100.00 2020/5/9
Intelligent established
Liaoyang Kangshun Newly
50,000,000.00 100.00 2020/9/10
Regeneration established
Newly
Nanjing Konka 10,000,000.00 100.00 2020/6/18
established
Newly
Gaoping Kangrun 100,000,000.00 48.45 2020/5/29
established
Newly
Mengcheng Kangrun 100,000,000.00 43.35 2020/6/19
established
Newly
Xixian Kangrun 163,780,500.00 26.01 2020/4/16
established
Newly
Chongzhou Kangrun 50,000,000.00 42.67 2020/8/28
established
Newly
Xi'an Kangrun 73,710,000.00 48.45 2020/8/28
established
Newly
Ankang Kangrun 100,000,000.00 26.01 2020/9/10
established
Newly
Changning Kangrun 50,000,000.00 45.89 2020/10/19
established
Linfen Kangrun 95,000,000.00 39.24 2020/12/30 Newly
318
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Time and place
Shareholding Method of
Name Registered capital of obtaining
percentage (%) obtaining
control power
established
Jiangsu Konka Special Newly
100,000,000.00 51.00 2020/12/24
Materials established
Chongqing Kangxingrui Newly
100,000,000.00 51.00 2020/4/17
Automobile Recycling established
Konka Xinyun Newly
100,000,000.00 56.00 2020/4/17
Semiconductor established
Yantai Kangyun Real Newly
10,000,000.00 51.00 2020/11/27
Estate established
Chongqing Kanglei Newly
50,000,000.00 51.00 2020/2/27
Optoelectronics established
Newly
Yibin Kangrun 100,000,000.00 83.83 2020/4/21
established
Newly
Henan Kangxin Real Estate 50,000,000.00 51.00 2020/8/24
established
Shenzhen Kangxin Real Newly
50,000,000.00 51.00 2020/12/21
Estate established
Henan Kanghan Real Newly
50,000,000.00 51.00 2020/12/28
Estate established
Newly
Kangshi Virtual 100,000,000.00 100.00 2020/9/21
established
Zhongshan Kangxin Newly
1,000,000.00 51.00 2020/6/9
Electronics established
Newly
Zhongshan Kangao 43,500,000.00 51.00 2020/9/3
established
Newly
Chongqing Chengda 50,000,000.00 51.00 2020/9/14
established
Newly
Chongqing Chunfu 50,000,000.00 51.00 2020/9/21
established
319
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Time and place
Shareholding Method of
Name Registered capital of obtaining
percentage (%) obtaining
control power
Newly
Chongqing Langheng 50,000,000.00 51.00 2020/9/23
established
Newly
Hong Kong Morsemi HKD10,000.00 51.00 2020/4/20
established
（2）The situation of the company's cancellation of the distribution of remaining assets of
the subsidiary in 2020
Shareholding Liquidation
Name Registered capital
percentage (%) completion time
Konka Enterprise Management 5,000,000.00 51.00 2020/8/26
Youshi Kangrong 70,000,000.00 70.00 2020/7/1
Life Electric Appliance 42,000,000.00 75.00 2020/12/10
Commercial System Technology 12,000,000.00 81.00 2020/12/7
Frestec Smart 10,000,000.00 51.00 2020/9/27
Yuekang Semiconductor 100,000,000.00 100.00 2020/2/24
Kangshi Virtual 100,000,000.00 100.00 2020/12/28
Kangxin Technology 10,000,000.00 51.00 2020/11/20
Hainan Technology 100,000,000.00 51.00 2020/11/17
Nanjing Konka Smart 50,000,000.00 100.00 2020/11/17
Zhongshan Kangxin Electronic 1,000,000.00 51.00 2020/12/4
Boxing Xingkang Environmental 100,000,000.00 35.70 2020/11/19
Yantai Konka Industrial 100,000,000.00 89.71 2020/12/31
Shandong Kangxin 100,000,000.00 51.00 2020/12/24
Kanghong (Yantai) Environmental
10,000,000.00 51.00 2020/9/29
Protection Industrial Park
Debao New Materials 50,000,000.00 51.00 2020/12/7
Kangxinlong Environmental
30,000,000.00 100.00 2020/12/8
Protection
320
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
VIII. Equity in Other Entities
1. Equity in Subsidiary
（1） Subsidiaries
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Other
Establishmen
Shenzhen, Shenzhen, organization and
1 Konka Ventures 51 t or
Guangdong Guangdong management
investment
service
Other
Establishmen
Yantai, Yantai, professional
2 Yantai Konka 51 t or
Shandong Shandong consultancy and
investment
investigation
Establishmen
Chengdu, Chengdu, Commercial
3 Chengdu Anren 51 t or
Sichuan Sichuan service
investment
Establishmen
Konka Enterprise Guiyang, Guiyang, Headquarters
4 51 t or
Service Guizhou Guizhou management
investment
Establishmen
Chuanghui Nanjing, Nanjing, Entrepreneurial s
5 40.8 t or
Intelligent Jiangsu Jiangsu pace service
investment
Establishmen
Yibin Konka Commercial
6 Yibin, Sichuan Yibin, Sichuan 51 t or
Incubator service
investment
Establishmen
Chuzhou, Chuzhou, Manufacturing
7 Anhui Konka 78 t or
Anhui Anhui industry
investment
Establishmen
Chuzhou, Chuzhou, Wholesale
8 Kangzhi Trade 78 t or
Anhui Anhui industry
investment
321
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Insurance agents Establishmen
Shenzhen, Shenzhen,
9 Konka Factoring (non-bank 100 t or
Guangdong Guangdong
finance) investment
Establishmen
Shenzhen, Shenzhen,
10 Konka Unifortune Retail industry 51 t or
Guangdong Guangdong
investment
Establishmen
Hong Kong, Hong Kong,
11 Jiali International Retail industry 51 t or
China China
investment
Establishmen
Shenzhen, Shenzhen, Software
12 Wankaida 100 t or
Guangdong Guangdong development
investment
Establishmen
Dongguan, Dongguan, Manufacturing
13 Dongguan Konka 75 25 t or
Guangdong Guangdong industry
investment
Establishmen
Suining Konka Suining， Suining， Wholesale
14 100 t or
Intelligent Sichuan Sichuan industry
investment
Establishmen
Frankfurt, Frankfurt, International
15 Konka Europe 100 t or
Germany Germany trading
investment
Establishmen
Konka Electrical Shenzhen, Shenzhen, Manufacturing
16 100 t or
Appliances Guangdong Guangdong industry, trading
investment
Establishmen
Telecommunication Shenzhen, Shenzhen, Manufacturing
17 75 25 t or
Technology Guangdong Guangdong industry
investment
Establishmen
Hong Kong, Hong Kong, Manufacturing
18 Konka Mobility 100 t or
China China industry
investment
322
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
Mobile Shenzhen, Shenzhen,
19 Commerce 100 t or
Interconnection Guangdong Guangdong
investment
Establishmen
Manufacturing
20 Sichuan Konka Yibin, Sichuan Yibin, Sichuan 100 t or
industry
investment
Establishmen
Information
21 Yibin Intelligent Yibin, Sichuan Yibin, Sichuan 100 t or
service
investment
Establishmen
Chuzhou, Chuzhou, Manufacturing
22 Anhui Tongchuang 100 t or
Anhui Anhui industry
investment
Establishmen
Electrical Appliance Chuzhou, Chuzhou, Manufacturing
23 51 t or
Technology Anhui Anhui industry
investment
Establishmen
Frestec Xinxiang, Xinxiang, Manufacturing
24 51 t or
Refrigeration Henan Henan industry
investment
Establishmen
Xinxiang, Xinxiang,
25 Frestec Smart Home Retail industry 51 t or
Henan Henan
investment
Establishmen
Frestec Electrical Xinxiang, Xinxiang, Manufacturing
26 51 t or
Appliances Henan Henan industry
investment
Establishmen
Frestec Household Xinxiang, Xinxiang, Manufacturing
27 51 t or
Appliances Henan Henan industry
investment
Electrical
Establishmen
Jiangsu Konka Changzhou, Changzhou, machinery and
28 51 t or
Smart Jiangsu Jiangsu equipment
investment
manufacturing
323
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
29 Kangjiatong Yibin, Sichuan Yibin, Sichuan Service industry 51 t or
investment
Establishmen
Pengrun Shenzhen, Shenzhen,
30 Retail industry 51 t or
Technology Guangdong Guangdong
investment
Establishmen
Hong Kong, Hong Kong,
31 Jiaxin Technology Retail industry 51 t or
China China
investment
Establishmen
Dongguan, Dongguan, Manufacturing
32 Dongguan Packing 75 25 t or
Guangdong Guangdong industry
investment
Establishmen
Shenzhen, Shenzhen, Information
33 E2info 95.78 t or
Guangdong Guangdong service
investment
Establishmen
Haikou, Haikou, Information
34 E2info (Hainan) 95.78 t or
Hainan Hainan service
investment
Establishmen
Beijing Konka Sale of home
35 Beijing Beijing 100 t or
Electronic appliance
investment
Tianjin Pilot Tianjin Pilot Establishmen
36 Konka Leasing Free Trade Free Trade Leasing industry 100 t or
Zone Zone investment
Establishmen
Shenzhen Konka Shenzhen, Shenzhen, Investment
37 100 t or
Circuit Guangdong Guangdong holding
investment
Establishmen
Boluo Konka Boluo, Boluo, Manufacturing
38 100 t or
Precision Guangdong Guangdong industry
investment
324
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
Xiamen, Xiamen,
39 Xiamen Dalong Commerce 69.23 t or
Fujian Fujian
investment
Establishmen
Boluo, Boluo, Manufacturing
40 Boluo Konka 100 t or
Guangdong Guangdong industry
investment
Establishmen
Hong Kong, Hong Kong, International
41 Hong Kong Konka 100 t or
China China trading
investment
Konka Household Establishmen
Hong Kong, Hong Kong, Investment
42 Appliances 100 t or
China China holding
Investment investment
Establishmen
Hong Kong, Hong Kong, International
43 Chain Kingdom 51 t or
China China trading
investment
Establishmen
Chain Kingdom Shenzhen, Shenzhen, Wholesale
44 51 t or
Shenzhen Guangdong Guangdong industry
investment
Establishmen
Hefei Chain Information
45 Hefei, Anhui Hefei, Anhui 51 t or
Kingdom service
investment
Establishmen
Hong Kong, Hong Kong, International
46 Konka Zhisheng 61 t or
China China trading
investment
Establishmen
Hong Kong, Hong Kong,
47 Kangjietong Service industry 51 t or
China China
investment
Konka Household
Establishmen
Appliances Hong Kong, Hong Kong, International
48 100 t or
International China China trading
investment
Trading
325
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
KONKO Establishmen
International
49 TECHNOLOGIES Cairo, Egypt Cairo, Egypt 67 t or
trading
CO. investment
Establishmen
Konka North California, California, International
50 100 t or
America LLC USA USA trading
investment
Establishmen
Shenzhen, Shenzhen, Capital markets
51 Konka Invstment 100 t or
Guangdong Guangdong service
investment
Development and Establishmen
52 Yibin Konka Yibin, Sichuan Yibin, Sichuan management of 100 t or
industrial park investment
Establishmen
Shenzhen, Shenzhen, Capital markets
53 Konka Capital 100 t or
Guangdong Guangdong service
investment
Investment in
industry,
commercial Establishmen
Shenzhen, Shenzhen,
54 Konka Suiyong information 51 t or
Guangdong Guangdong
consultancy and investment
investment
advisor
Establishmen
Kangquan Shenzhen, Shenzhen, Commercial
55 51 t or
Enterprise Guangdong Guangdong service
investment
Establishmen
Shenzhen, Shenzhen, Commercial
56 Konka Suyuan 51 t or
Guangdong Guangdong service
investment
Establishmen
Shengxing Shenzhen, Shenzhen, Commercial
57 51 t or
Enterprise Guangdong Guangdong service
investment
326
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
Industrial Park Shenzhen, Shenzhen, Commercial
58 51 t or
Development Guangdong Guangdong service
investment
Software and
Establishmen
Shenzhen, Shenzhen, information
59 Zhitong Technology 51 t or
Guangdong Guangdong technology
investment
service
Establishmen
Electronics Shenzhen, Shenzhen, Manufacturing
60 100 t or
Technology Guangdong Guangdong industry
investment
Establishmen
Chuzhou, Chuzhou, Electronic
61 Anhui Zhilian 100 t or
Anhui Anhui commerce
investment
Software and
Establishmen
Shenzhen, Shenzhen, information
62 Youzhihui 100 t or
Guangdong Guangdong technology
investment
service industry
Establishmen
Shenzhen, Shenzhen,
63 Xiaojia Technology Retail industry 100 t or
Guangdong Guangdong
investment
Establishmen
Nantong, Nantong, Wholesale and
64 Haimen Konka 100 t or
Jiangsu Jiangsu retail industry
investment
Establishmen
Chengdu Konka Chengdu, Chengdu, Wholesale and
65 100 t or
Intelligent Sichuan Sichuan retail industry
investment
Establishmen
Chengdu Konka Chengdu, Chengdu, Manufacturing
66 100 t or
Electronic Sichuan Sichuan industry
investment
Zhongshan, Zhongshan, Manufacturing Establishmen
67 XingDa HongYe 51
Guangdong Guangdong industry t or
327
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
investment
Establishmen
68 Shanghai Xinfeng Shanghai Shanghai Commerce 51 t or
investment
Liaoyang Kangshun Establishmen
Liaoyang, Liaoyang, Wholesale
69 Intelligent 100 t or
Liaoning Liaoning industry
Technology investment
Liaoyang Kangshun Comprehensive Establishmen
Liaoyang, Liaoyang,
70 Renewable utilization of 100 t or
Liaoning Liaoning
Resources waste resources investment
Establishmen
Nanjing, Nanjing, Wholesale
71 Nanjing Konka 100 t or
Jiangsu Jiangsu industry
investment
Establishmen
Yantai, Yantai, Commercial
72 Yantai Laikang 51 t or
Shandong Shandong service
investment
Environmental Establishmen
Yantai, Yantai,
73 Econ Technology technology 51 t or
Shandong Shandong
service industry investment
Environmental Establishmen
74 Beijing Kangyi Beijing Beijing technology 51 t or
service industry investment
Environmental Establishmen
75 Shanghai Jiyi Shanghai Shanghai technology 51 t or
service industry investment
Environmental Establishmen
Binzhou, Binzhou,
76 Binzhou Econ technology 51 t or
Shandong Shandong
service industry investment
Yantai, Yantai, Environmental Establishmen
77 Lairun Holdings 30.6
Shandong Shandong technology t or
328
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
service industry investment
Lairun Environmental Establishmen
Yantai, Yantai,
78 Environmental technology 27.54 t or
Shandong Shandong
Protection service industry investment
Environmenal
Establishmen
Laizhou Lairun Yantai, Yantai, protection and
79 24.14 t or
Sewage Treatment Shandong Shandong environment
investment
management
Environmental Establishmen
Binhai Sewage Yantai, Yantai,
80 technology 30.6 t or
Treatment Shandong Shandong
service industry investment
Econ Environmental Establishmen
Chengdu, Chengdu,
81 Environmental technology 51 t or
Sichuan Sichuan
Engineering service industry investment
Environmental Establishmen
Weihai, Weihai,
82 Rushan Yike technology 44.37 t or
Shandong Shandong
service industry investment
Environmental Establishmen
Binzhou, Binzhou,
83 Binzhou Weiyijie technology 35.7 t or
Shandong Shandong
service industry investment
Environmental Establishmen
Binzhou, Binzhou,
84 Beihai Jingmai technology 24.99 t or
Shandong Shandong
service industry investment
Environmental Establishmen
Yantai, Yantai,
85 Yantai Chunzhiran technology 35.7 t or
Shandong Shandong
service industry investment
Environmental Establishmen
Dandong, Dandong,
86 Donggang Kangrun technology 50.7 t or
Liaoning Liaoning
service industry investment
Kangrunhong Environmental Establishmen
87 Yantai, Yantai, 51
Environmental technology t or
329
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Protection Shandong Shandong service industry investment
Environmental Establishmen
Dayi Kangrun Chengdu, Chengdu,
88 technology 51 t or
Water Sichuan Sichuan
service industry investment
Environmental Establishmen
Suining Pengxi Suining, Suining,
89 technology 40.75 t or
Kangrun Sichuan Sichuan
service industry investment
Environmental Establishmen
Subei Kangrun Jiuquan, Jiuquan,
90 technology 39.78 t or
Water Gansu Gansu
service industry investment
Environmental Establishmen
Weifang Sihai Weifang, Weifang,
91 technology 32.09 t or
Kangrun Shandong Shandong
service industry investment
Environmental
Lushan Kangrun Establishmen
Pingdingshan, Pingdingshan, protection and
92 Environmental 45.44 t or
Henan Henan environment
Protection investment
management
Environmental
Establishmen
Funan Kangrun protection and
93 Fuyang, Anhui Fuyang, Anhui 40.55 t or
Water environment
investment
management
Environmental
Establishmen
Wuhan Runyuan protection and
94 Wuhan, Hubei Wuhan, Hubei 35.7 t or
Sewage Treatment environment
investment
management
Environmental
Establishmen
Tongchuan Kangrun Tongchuan, Tongchuan, protection and
95 45.39 t or
Honghui Shaanxi Shaanxi environment
investment
management
Tingyuan Research and Establishmen
96 Shanghai Shanghai 51
Environmental experimental t or
330
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Protection development investment
Ecological
protection and Establishmen
Jincheng, Jincheng,
97 Gaoping Kangrun environmental 48.45 t or
Shanxi Shanxi
governance investment
industry
Water
Establishmen
Mengcheng conservancy
98 Bozhou, Anhui Bozhou, Anhui 43.35 t or
Kangrun management
investment
industry
Public facilities Establishmen
Xi Xian New Xi Xian New
99 Xi Xian Kangrun management 26.01 t or
Area, Shaanxi Area, Shaanxi
industry investment
Ecological
protection and Establishmen
Chongzhou Chongzhou, Chongzhou,
100 environmental 42.67 t or
Kangrun Sichuan Sichuan
management investment
industry
Ecological
protection and Establishmen
101 Xi 'an Kangrun Xi'an, Shaanxi Xi'an, Shaanxi environmental 48.45 t or
management investment
industry
Ecological
protection and Establishmen
Ankang, Ankang,
102 Ankang Kangrun environmental 26.01 t or
Shaanxi Shaanxi
management investment
industry
Water production Establishmen
Hengyang, Hengyang,
103 Changning Kangrun and supply 45.89 t or
Hunan Hunan
industry investment
331
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
Yantai, Yantai, Internet and
104 Bokang Renewable 26.01 t or
Shandong Shandong related services
investment
Water production Establishmen
105 Linfen Kangrun Linfen, Shanxi Linfen, Shanxi and supply 39.24 t or
industry investment
Processing of Establishmen
Dalian, Dalian,
106 Konka Huanjia renewable 51 t or
Liaoning Liaoning
resources investment
Technology
Establishmen
Konka Huanjia Lankao, Lankao, extension and
107 51 t or
(Henan) Henan Henan application
investment
service industry
Establishmen
Real estate
108 Shanghai Konka Shanghai Shanghai 100 t or
industry
investment
Establishmen
Yantai, Yantai, Real estate
109 Yantai Kangjin 0 62.80 t or
Shandong Shandong industry
investment
Production, Establishmen
Jiujiang, Jiujiang,
110 Jiangxi Konka manufacturing 51 t or
Jiangxi Jiangxi
and processing investment
Production, Establishmen
Xinfeng Nanchang, Nanchang,
111 manufacturing 51 t or
Microcrystalline Jiangxi Jiangxi
and processing investment
Production, Establishmen
Jiujiang, Jiujiang,
112 Nanocrystalline manufacturing 51 t or
Jiangxi Jiangxi
and processing investment
Establishmen
Jiangsu Konka Wholesale
113 Jiangsu Yancheng 51 t or
Special Materials industry
investment
332
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
Establishmen
Shenzhen, Shenzhen, Commercial
114 Shenzhen Nianhua 100 t or
Guangdong Guangdong service
investment
Establishmen
Shenzhen Shenzhen, Shenzhen,
115 Semi-conductor 100 t or
Kangxinwei Guangdong Guangdong
investment
Establishmen
Design of
116 Hefei Kangxinwei Hefei, Anhui Hefei, Anhui 51 t or
integrated circuit
investment
Establishmen
Wholesale
117 Yihe Electronic Hefei, Anhui Hefei, Anhui 51 t or
industry
investment
Software and
Establishmen
information
118 Chongqing Konka Chongqing Chongqing 100 t or
technology
investment
service
Establishmen
Shenzhen Huiying Shenzhen, Shenzhen, Wholesale
119 51 t or
Technology Guangdong Guangdong industry
investment
Manufacturing
industry in
computer, Establishmen
Chongqing Huiying
120 Chongqing Chongqing communication 51 t or
Technology
and other investment
electronic
equipment
Establishmen
Konkan Ecological Shenzhen, Shenzhen, Commercial
121 51 t or
Development Guangdong Guangdong service
investment
Suining Konka Suining, Suining, Industrial park Establishmen
122 100
Industrial Park Sichuan Sichuan development and t or
333
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
operation investment
management
Establishmen
Jiaxing, Jiaxing, Wholesale and
123 Konka Integration 51 t or
Zhejiang Zhejiang retail industry
investment
Suining Electronic Establishmen
Suining, Suining, Commercial
124 Technological 100 t or
Sichuan Sichuan service
Innovation investment
Shenzhen Establishmen
Shenzhen, Shenzhen, Wholesale
125 Chuangzhi 100 t or
Guangdong Guangdong industry
Appliances investment
Comprehensive
Koanghong (Yantai) Establishmen
Yantai, Yantai, utilization of
126 Environmental 51 t or
Shandong Shandong waste resources
Protection investment
industry
Technology
Establishmen
Chongqing extension and
127 Chongqing Chongqing 51 t or
Kangxingrui application
investment
service industry
Chongqing
Establishmen
Kangxingrui Wholesale
128 Chongqing Chongqing 51 t or
Automobile industry
investment
Recycling
Chongqing Konka
Research and Establishmen
Photoelectric
129 Chongqing Chongqing experimental 75 t or
Technology
development investment
Research Institute
Manufacturing
Establishmen
Xinying Shenzhen, Shenzhen, industry in
130 56 t or
Semiconductor Guangdong Guangdong computer,
investment
communication
334
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
and other
electronic
equipment
Computer,
communications
Establishmen
Konka Xinyun Yancheng, Yancheng, and other
131 56 t or
Semiconductor Jiangsu Jiangsu electronic
investment
equipment
manufacturing
Jiangkang Research and Establishmen
132 (Shanghia) Shanghai Shanghai experimental 51 t or
Technology development investment
Electrical
Establishmen
Ningbo Kanghanrui Ningbo, Ningbo, machinery and
133 60 t or
Appliances Zhejiang Zhejiang equipment
investment
manufacturing
Research and Establishmen
Shenzhen, Shenzhen,
134 Konka Zhizao experimental 51 t or
Guangdong Guangdong
development investment
Establishmen
Suining Jiarun Suining, Suining, Real estate
135 100 t or
Properties Sichuan Sichuan industry
investment
Establishmen
Yantai, Yantai, Commercial
136 Yantai Kangyun 51 t or
Shandong Shandong service
investment
Establishmen
Yantai Kangyun Yantai, Yantai, Real estate
137 51 t or
Real Estate Shandong Shandong industry
investment
Computer, Establishmen
Chongqing Kanglei
138 Chongqing Chongqing communications 51 t or
Optoelectronic
and other investment
335
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Serial Main Holding percentage
Registration Nature of (%) Way of
numb Name operating
place business gaining
er place Directly Indirectly
electronic
equipment
manufacturing
Establishmen
139 Yibin Kangrun Yibin, Sichuan Yibin, Sichuan Retail industry 67 16.83 t or
investment
Establishmen
Henan Kangxin Xinxiang, Xinxiang, Real estate
140 51 t or
Real Estate Henan Henan industry
investment
Establishmen
Haikou, Haikou, Commercial
141 Konka Material 51 t or
Hainan Hainan service
investment
Establishmen
Shenzhen Kangxin Shenzhen, Shenzhen, Real estate
142 51 t or
Real Estate Guangdong Guangdong industry
investment
Establishmen
Henan Kanghan Xinxiang, Xinxiang, Real estate
143 51 t or
Real Estate Henan Henan industry
investment
Note: The indirect shareholding of the Company shall be the penetration ratio of the subsidiary
enjoyed by the Company at the consolidation level, and belongs to the final equity share of the
subsidiary enjoyed by the Company.
（2） Significant Non-wholly-owned Subsidiary
Name Shareholdi The profit or loss Declaring Balance of
ng attributable to dividends non-controlling
proportion the distributed interests at the
of non-controlling to period-end
336
non-contro interests non-controll
lling ing interests
interests
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Econ Technology 49.00% 175,727,753.55 1,006,599,295.10
Chain Kingdom Memory
49.00% 15,320,687.02 62,712,463.12
Technologies
337
Notes to the Financial Statements of Konka Group Co., Ltd.
January 1, 2020 to December 31, 2020
(Unless otherwise specified, the notes to this financial statement are all listed in RMB)
（3） The Main Financial Information of Significant Not Wholly-owned Subsidiary
Ending balance
Name Non-current Non-current
Current assets Total assets Current liabilities Total liabilities
assets liability
Econ Technology 4,462,132,589.77 8,755,726,357.81 13,217,858,947.58 8,703,704,732.25 2,962,052,834.96 11,665,757,567.21
Chain Kingdom
1,222,933,011.37 515,766.12 1,223,448,777.49 1,095,464,158.88 1,095,464,158.88
Memory Technologies
(Continued)
Beginning balance
Name Non-current Non-current
Current assets Total assets Current liabilities Total liabilities
assets liability
4,188,510,893.2
Econ Technology 2,301,862,406.07 6,490,373,299.31 4,112,410,680.62 1,228,550,874.55 5,340,961,555.17
4
Chain Kingdom Memory
1,589,255,895.39 681,653.19 1,589,937,548.58 1,485,611,244.88 1,485,611,244.88
Technologies
(Continued)
Name Reporting Period
338
Notes to the Financial Statements of Konka Group Co., Ltd.
January 1, 2020 to December 31, 2020
(Unless otherwise specified, the notes to this financial statement are all listed in RMB)
Total comprehensive Cash flows from
Operating revenue Net profit
income operating activities
Econ Technology 3,272,636,835.33 320,737,166.02 320,737,166.02 -571,785,929.67
Chain Kingdom Memory Technologies 8,261,027,364.98 31,266,708.21 23,658,314.91 -66,646,309.67
(Continued)
Same period of last year
Name Total comprehensive Cash flows from
Operating revenue Net profit
income operating activities
Econ Technology 2,089,742,540.39 257,946,089.57 257,946,089.57 -255,466,347.95
Chain Kingdom Memory Technologies 7,255,440,615.91 57,623,214.42 60,113,821.08 -3,025,942.67
339
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. Changes in the share of owners' equity in subsidiaries this year have no impact on equity.
3. Equity in Joint Ventures or Associated Enterprises
（1）Significant Joint Ventures or Associated Enterprises
Holding Accounting
percentage treatment of
Main Regi (%) the
operat strati Nature of
Name investment to
ing on business
Direct Indir joint venture
place place
ly ectly or associated
enterprise
Dongfang Konka No.1 Investment
Zhuh Equity
(Zhuhai) Private Equity Zhuhai manageme 49.95
ai method
Investment Fund (LP) nt
Electronic
Dongg Dong Equipment Equity
Chutian Dragon Co., Ltd. 20.00
uan guan Manufactur method
ing
340
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Environme
ntal
Binzhou Beihai Weiqiao Solid Binzh Binz protection Equity
49.00
Waste Disposal Co., Ltd. ou hou and method
environmen
tal
manageme
（2）Main Financial Information of Significant Associated Enterprise nt
Ending balance/Reporting Period
Dongfang Konka
No.1 (Zhuhai) Binzhou Beihai
Item Chutian Dragon Co.,
Private Equity Weiqiao Solid Waste
Ltd.
Investment Fund Disposal Co., Ltd.
(LP)
Current assets 686,710,061.46 1,379,255,401.46 287,246,826.69
Non-current assets 265,580,626.48 178,087,639.51
Total assets 686,710,061.46 1,644,836,027.94 465,334,466.20
Current liabilities 285,530.00 541,529,388.70 87,098,339.17
Non-current liability 25,206,327.43
Total liabilities 285,530.00 566,735,716.13 87,098,339.17
Equity of -3,256,204.02
341
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance/Reporting Period
Dongfang Konka
No.1 (Zhuhai) Binzhou Beihai
Item Chutian Dragon Co.,
Private Equity Weiqiao Solid Waste
Ltd.
Investment Fund Disposal Co., Ltd.
(LP)
non-controlling interests
Equity attributable to
shareholders of the 686,424,531.46 1,081,356,515.83 378,236,127.03
Company as the parent
Share of net assets
accounted by 336,170,619.84 236,744,836.67 185,335,702.24
shareholding percentage
Adjustment items
-Goodwill 413,461,970.35
-Unrealized profit of
-2,535,163.18
internal transaction
Others -134,510.81
Book value of equity
investment in joint 336,170,619.84 650,206,807.02 182,666,028.25
venture
342
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance/Reporting Period
Dongfang Konka
No.1 (Zhuhai) Binzhou Beihai
Item Chutian Dragon Co.,
Private Equity Weiqiao Solid Waste
Ltd.
Investment Fund Disposal Co., Ltd.
(LP)
Fair value of equity
investment of joint
venture with public offer
Operating revenue 1,025,155,857.95 220,586,264.46
Finance costs -257,638.57 -4,018,451.37 -82,236.61
Income tax expense 14,153,788.28 -2,050,943.53
Net profit 84,878,495.25 96,798,712.97 130,067,221.02
Net profit from
discontinued operations
Other comprehensive
income
Total comprehensive 84,878,495.25 96,798,712.97 130,067,221.02
343
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance/Reporting Period
Dongfang Konka
No.1 (Zhuhai) Binzhou Beihai
Item Chutian Dragon Co.,
Private Equity Weiqiao Solid Waste
Ltd.
Investment Fund Disposal Co., Ltd.
(LP)
income
Dividends received from
the joint venture in the 9,240,000.00 10,300,000.00
current year
(Continued)
Beginning balance/Same period of last year
Dongfang Konka
Binzhou Beihai
No.1 (Zhuhai)
Item Chutian Dragon Weiqiao Solid
Private Equity
Co., Ltd. Waste Disposal
Investment Fund
Co., Ltd.
(LP)
Current assets 632,869,229.53 1,243,797,727.50 168,736,029.14
Non-current assets 290,274,962.74 182,046,220.08
Total assets 632,869,229.53 1,534,072,690.24 350,782,249.22
344
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance/Same period of last year
Dongfang Konka
Binzhou Beihai
No.1 (Zhuhai)
Item Chutian Dragon Weiqiao Solid
Private Equity
Co., Ltd. Waste Disposal
Investment Fund
Co., Ltd.
(LP)
Current liabilities 44,259,288.94 485,651,089.30 72,613,343.21
Non-current liability 25,018,287.84
Total liabilities 44,259,288.94 510,669,377.14 72,613,343.21
Equity of non-controlling
interests
Equity attributable to
shareholders of the Company 588,609,940.59 1,023,403,313.10 278,168,906.01
as the parent
Share of net assets accounted
310,024,401.51 222,599,666.35 136,302,763.94
by shareholding percentage
Adjustment items
-Goodwill 413,461,970.35
-Unrealized profit of internal
-2,535,163.18
transaction
345
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance/Same period of last year
Dongfang Konka
Binzhou Beihai
No.1 (Zhuhai)
Item Chutian Dragon Weiqiao Solid
Private Equity
Co., Ltd. Waste Disposal
Investment Fund
Co., Ltd.
(LP)
Others -134,510.81
Book value of equity
310,024,401.51 636,061,636.70 133,633,089.95
investment in joint venture
Fair value of equity
investment of joint venture
with public offer
Operating revenue 1,182,099,672.38 291,745,561.77
Finance costs -12,631.40 -2,473,856.91 420,534.06
Income tax expense 344,172.57 16,916,284.79
Net profit 94,882,517.71 117,058,262.27 201,212,689.88
Net profit from discontinued
operations
346
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance/Same period of last year
Dongfang Konka
Binzhou Beihai
No.1 (Zhuhai)
Item Chutian Dragon Weiqiao Solid
Private Equity
Co., Ltd. Waste Disposal
Investment Fund
Co., Ltd.
(LP)
Other comprehensive income
Total comprehensive income 94,882,517.71 117,058,262.27 201,212,689.88
Dividends received from the
joint venture in the current 11,088,000.00 24,500,000.00
year
（3）Summary Financial Information of Insignificant Joint Ventures or Associated Enterprises
Beginning
Ending
balance/The
Item balance/Reportin
Same period of
g Period
last year
Associated enterprise:
Total carrying value of investment 3,637,302,366.34 3,249,236,533.91
347
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning
Ending
balance/The
Item balance/Reportin
Same period of
g Period
last year
The total of following items according to the
shareholding proportions
--Net profit -32,617,474.82 431,670.21
--Other comprehensive income 1,486,737.16 -335,456.79
--Total comprehensive income -31,130,737.66 96,213.42
IX. The Risk Related to Financial Instruments
The Company’s main financial instruments include borrowings, accounts receivable, accounts payable, trading financial assets and liabilities, etc. Please
refer to Note VI for detailed descriptions of various financial instruments. Risks related to these financial instruments, and risk management policies the
Company has adopted to reduce these risks are described as follows. The Company management manages and monitors the risk exposure in order to ensure
the above risks to be controlled in a limited scope.
1. Various Risk Management Objectives and Policies
The goals of the Company engaged in the risk management is to achieve the proper balance between the risks and benefits, reduced the negative impact
to the Company operating performance risk to a minimum, maximized the profits of shareholders and other equity investors. Based on the risk management
348
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
goal, the basic strategy of the Company's risk management is determine and analyze the various risks faced by the Company, set up the bottom line of risk and
conducted appropriate risk management, and timely supervised various risks in a reliable way and controlled the risk within the range of limit.
（1）Market Risk
1）Foreign Exchange Risk
Foreign exchange risk refers to the risks that may lead to losses due to fluctuation in exchange rate. The foreign exchange risk borne by the Company is
related to USD. Except the procurement and sales by USD for several subsidiaries of the Company, the other main businesses of the Company were settled by
RMB. The foreign exchange risks produced by the assets and liabilities balance may affect the business performance of the Company. As of December 31,
2020, except for the assets or liabilities mentioned in the table below, the assets and liabilities of the Company are mainly the balance of RMB.
Item Period-end Period-begin
Cash and cash
95,989,561.32 161,346,670.90
equivalents
Accounts receivable 132,221,173.92 118,602,602.84
Other receivables 135,938,277.17 6,281,335.37
Interest receivables
Short-term
59,159,714.38 98,297,903.18
borrowings
Accounts payable 42,417,352.11 42,269,219.38
Interest payable 99,200.24 275,923.30
349
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The company pays close attention to the impact of exchange rate changes on the company's foreign exchange risk, and requires major companies in the
group that purchase and sell in foreign currency to pay attention to the changes in foreign currency assets and liabilities, manage the group's foreign currency
net asset exposure in a unified way, implement single currency settlement, and reduce the scale of foreign currency assets and liabilities, so as to reduce
foreign exchange risk exposure.
2）Interest Rate Risk
The Company bears interest rate risk due to interest rate changes of interest bearing financial assets and liabilities. The Company's interest bearing
financial assets are mainly bank deposits, of which the variable interest rate is mostly short-term, while the interest bearing financial liabilities are mainly bank
loans and corporate bonds. The Company's long-term bank borrowings and corporate bonds are fixed interest rates. Therefore, it is considered that the risk
caused by the change of interest rate is mainly related to the short-term bank borrowings. The Company's policy is to maintain the floating interest rate of
these borrowings in order to eliminate the fair value risk of interest rate changes. On December 31, 2019, the balance of such short-term borrowings is RMB
10,990,550,475.78.
（2）Credit Risk
As of December 31, 2020, the maximum credit risk exposure that may cause financial losses to the Company mainly came from losses generated from
the Company’s financial assets due to failure of the other party in a contract to perform its obligations and the financial guarantee undertaken by the Company,
including:
The carrying amount of financial assets recognized in the consolidated balance sheet; for financial instruments measured at fair value, the book value
reflects their risk exposure, but not the maximum risk exposure, and the maximum risk exposure will change with the change of future fair value.
In order to reduce credit risk, the company has set up a group to determine the credit limit, conduct credit approval, and implement other monitoring
procedures to ensure that necessary measures are taken to recover overdue claims. In addition, the company reviews the recovery of each single receivable on
350
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
each balance sheet date to ensure that sufficient bad debt provision is made for the unrecoverable amount. Therefore, the company's management believes that
the company's credit risk has been greatly reduced.
The company's working capital is deposited in banks with high credit rating, so the credit risk of working capital is low.
The Company has adopted necessary policies to ensure that all customers have good credit records. Except for the top five customers in terms of the
amount of accounts receivable, the Company has no other major credit concentration risk. For the financial assets of the Company that have been individually
impaired, please refer to 4. Accounts Receivable and 7. Other Receivables in Note VI.
（3）Liquidity Risk
Liquidity risk refers to the risk that the company is unable to fulfill its financial obligations on the due date. The Company manages liquidity risk in the
method of ensuring that there is sufficient liquidity to fulfill debt obligations without causing unacceptable loss or damage to the Company’s reputation. In
order to mitigate the liquidity risk, the management of the company has carried out a detailed inspection on the liquidity of the company, including the
maturity of accounts payable and other payables, bank credit line and bond financing. The conclusion is that the company has sufficient funds to meet the
needs of the group's short-term debt and capital expenditure.
The analysis of the financial assets and financial liabilities held by the Company based on the maturity period of the undiscounted remaining contractual
obligations is as follows:
351
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Amount on December 31, 2020:
Item Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Financial assets
Monetary assets 5,431,530,180.90 5,431,530,180.90
Held-for-trading financial
618,249,541.66 618,249,541.66
assets
Notes receivable 2,358,180,193.96 2,358,180,193.96
Accounts receivable 2,569,915,591.31 897,205,290.70 433,321,830.59 454,911.00 3,900,897,623.59
Other receivables 1,573,166,227.32 421,239,674.89 126,426,976.91 24,903,761.48 2,145,736,640.60
Long-term receivables 37,310,158.82 48,853,780.97 56,233,905.16 294,409,517.90 436,807,362.85
Other current assets 1,913,146,483.39 1,913,146,483.39
Financial liabilities
10,990,550,475.7
Short-term borrowings 10,990,550,475.78
8
Notes payable 1,335,987,026.21 1,335,987,026.21
Accounts payable 8,134,924,659.58 1,279,766,515.39 217,675,150.79 9,632,366,325.76
Other payables 1,656,395,339.19 89,458,935.79 253,576,624.71 1,999,430,899.69
Payroll payable 476,616,244.45 476,616,244.45
Current portion of non-current 376,896,566.29 376,896,566.29
352
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
liabilities
Long-term borrowings 18,150,000.00 2,687,210,000.00 478,624,612.32 2,798,914,385.22 5,982,898,997.54
Bonds payable 4,993,212,788.32 4,993,212,788.32
Long-term payables 358,746,566.29 325,321,841.94 156,088,008.02 840,156,416.25
353
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. Sensitivity Analysis
The Company adopts sensitivity analysis technology to analyze the possible impact of
reasonable and possible changes of risk variables on current profits/losses or shareholders’ equity.
As any risk variable rarely changes in isolation, and the correlation between variables will have a
significant effect on the final impact amount of the change of a risk variable, the following
content is based on the assumption that the change of each variable is independent.
（1）Sensitivity analysis of foreign exchange risk
Assumption for the sensitivity of foreign exchange risk: All net investment hedging and cash
flow hedging of overseas operations are highly effective.
On the basis of the above assumption, under the condition that other variables remain
unchanged, the impact of reasonable changes in the exchange rate on current profits/losses and
equity after tax is as follows:
Change in the 2020
Item
exchange rate Impact on net profit Impact on shareholders’ equity
Appreciation of 1%
USD 16,211,942.87 13,375,843.78
against RMB
Depreciation of 1%
USD -16,211,942.87 -13,375,843.78
against RMB
（2）Sensitivity analysis of interest rate risk
The sensitivity analysis of interest rate risk is based on the following assumptions:
Changes in market interest rates affect the interest income or expenses of financial
instruments with variable interest rates;
For financial instruments with fixed interest rates measured at fair value, changes in market
interest rates only affect their interest income or expenses;
The fair value changes of derivative financial instruments and other financial assets and
liabilities are calculated with the market interest rate on the balance sheet date and the DCF
(discounted cash flow) method.
On the basis of the above assumption, under the condition that other variables remain
unchanged, the impact of reasonable changes in the exchange rate on current profits/losses and
equity after tax is as follows:
Item Change in 2020
354
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
the interest Impact on shareholders’
Impact on net profit
rate equity
Borrowings with
Up by 0.5% 41,364,032.83 39,778,444.84
a floating rate
Borrowings with Down by
-41,364,032.83 -39,778,444.84
a floating rate 0.5%
X. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Ending fair value
Fair
value
Fair value Fair value
Item measure
measurement measurement Total
ment
items at level 2 items at level 3
items at
level 1
I. Consistent fair value
618,249,541.66 618,249,541.66
measurement
(I) Trading financial assets
1. Financial assets at fair value
through profit or loss
(1) Debt instrument investment
(2) Equity instrument investment
(3) Derivative financial assets
(4) Structured deposits 618,249,541.66 618,249,541.66
(II) Accounts receivable financing 84,057,197.44 84,057,197.44
(III) Investment in other debt
obligations
(IV) Other equity instrument
25,343,293.16 25,343,293.16
investment
(V) Other non-current financial assets 1,878,154,796.73 1,878,154,796.73
355
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending fair value
Fair
value
Fair value Fair value
Item measure
measurement measurement Total
ment
items at level 2 items at level 3
items at
level 1
Total assets of consistent fair value
2,521,747,631.55 2,521,747,631.55
measurement
Total liabilities of consistent fair
value measurement
Total assets of inconsistent fair
value measurement
Total liabilities of inconsistent fair
value measurement
2. Basis for Determining the Market Prices of Consistent and Inconsistent Fair Value
Measurement Items at Level 1
Input value at Level 1 is the unadjusted quotation in the active market of the same assets or
liabilities that can be obtained on the measurement date.
3. Valuation Technique Adopted and Qualitative and Quantitative Information of
Important Parameters for Consistent and Inconsistent Fair Value Measurement Items at
Level 2
The Level 2 fair value measurement of input value at Level 2 is the input value observable
directly or indirectly of relevant assets or liabilities exclusive of input value at Level 1.
4. Valuation Technique Adopted and Qualitative and Quantitative Information of
Important Parameters for Consistent and Inconsistent Fair Value Measurement Items at
Level 3
Input value at Level 3 is the input value unobservable of relevant assets or liabilities.
356
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
XI. Related Party and Related-party Transaction
(I) Relationship of Related Party
1. Controlling Shareholder and the Ultimate Controller
（1）Controlling Shareholder and the Ultimate Controller
Voting right
Register Shareholding
Registrati ratio to the
Name Nature ed ratio to the
on place Company
capital Company (%)
(%)
Tourism, real
OCT Group Co., estate, RMB12
Shenzhen 29.999997 29.999997
Ltd. electronics billion
industry
Note: The ultimate controller of the Company is State-owned Assets Supervisor Commission
of the State Council.
（2） The Registered Capital of the Controlling Shareholder and its Changes
Controlling Increa Decre
Beginning balance Ending balance
shareholder se ase
OCT Group Co., Ltd. 12,000,000,000.00 12,000,000,000.00
（3） Controlling Shareholders’ Shares or Equity and their Changes
Controlling shareholder Shareholding amount Shareholding ratio (%)
357
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Percentage Percentage at
Ending Beginning
at the end of the beginning
balance balance
the year of the year
OCT Group Co., Ltd. 722,383,542.00 722,383,542.00 29.999997 29.999997
2. Subsidiary
Refer to note VIII-1(1) Subsidiaries for the information of subsidiaries.
3. Associated Enterprises and Joint Ventures
Refer to Note VIII-3. (1) Significant Associated Enterprises for details of significant
associated enterprises of the Company. Information on other joint ventures or associated
enterprises occurring connected transactions with the Company in Reporting Period, or forming
balance due to connected transactions made in previous period:
Name Relationship with the Company
Puchuang Jiakang Technology Co, Ltd. Associated enterprise
Dongguan Konka Electronic Smart Technology
Associated enterprise
Co., Ltd.
Shenzhen Konka E-display Co., Ltd. Associated enterprise
Wanjun Technology (Kunshan) Co., Ltd. Associated enterprise
E3info (Hainan) Technology Co., Ltd. Associated enterprise
Shenzhen Konka Information Network Co., Ltd. Associated enterprise
Anhui Kaikai Sihjie E-commerce Co., Ltd. Associated enterprise
Shenzhen Konka Smart Electric Appliances
Associated enterprise
Technology Co., Ltd.
Shandong Konka Smart Electrical Appliance
Associated enterprise
Co., Ltd.
Henan Konka Smart Electrical Appliance Co.,
Associated enterprise
Ltd.
Shenzhen Yaode Technology Co., Ltd. Associated enterprise
Heilongjiang Longkang Smart Electrical
Associated enterprise
Appliance Co., Ltd.
358
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Name Relationship with the Company
Binzhou Beihai Weiqiao Solid Waste Treatment
Associated enterprise
Co., Ltd.
Chongqing Qingjia Electronics Co., Ltd. Associated enterprise
Chuzhou Kangxin Health Industry Development
Associated enterprise
Co., Ltd.
Dongguan Konka Investment Co., Ltd. Associated enterprise
Shenzhen Jielunte Technology Co., Ltd. Associated enterprise
Feidi Technology (Shenzhen) Co., Ltd. and its
Associated enterprise
subsidiaries
Shenzhen RF-LINK Technology Co., Ltd Associated enterprise
4. Information on Other Related Parties
Name Relationship with the Company
Chuzhou Hanshang Electric Appliance Co.,
Minority shareholder of subsidiary
Ltd.
Shenzhen Jinzhu Industry Co., Ltd Minority shareholder of subsidiary
HOHOELECTRICAL&FURNITURECO.,LIM
Minority shareholder of subsidiary
ITED
Shenzhen Trade Link Supply Chain
Minority shareholder of subsidiary
Management Co., Ltd.
Huanjia Group Co., Ltd Minority shareholder of subsidiary
AUJET INDUSTRY LIMITED Minority shareholder of subsidiary
Handian Group Co., Ltd. Minority shareholder of subsidiary
Chongqing Liangshan Industrial Investment
Minority shareholder of subsidiary
Co., Ltd.
Shenzhen Unifortune Supply Chain
Minority shareholder of subsidiary
Management Co., Ltd
Shenzhen Musen Industrial Co., Ltd. Minority shareholder of subsidiary
Yantai Baijiangyuan Enterprise Management
Minority shareholder of subsidiary
Center (Limited Partnership)
Yantai Fengqingtai Investment Center (Limited
Minority shareholder of subsidiary
Partnership)
359
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Name Relationship with the Company
Yantai Qingrunyuan Enterprise Management
Minority shareholder of subsidiary
Center (Limited Partnership)
Yantai Qingjiangchuan Enterprise Management
Minority shareholder of subsidiary
Center (Limited Partnership)
Hu Zehong Minority shareholder of subsidiary
Chuzhou State-owned Assets Operation Co.,
Minority shareholder of subsidiary
Ltd.
Shenzhen Guoxin Microelectronics Co., Ltd. Minority shareholder of subsidiary
Yudong Environmental Technology Co., Ltd. Minority shareholder of subsidiary
Shenzhen Henglongtong Electronic
Minority shareholder of subsidiary
Technology Co., Ltd.
Guizhou Huajinrun Technology Group Co.,
Minority shareholder of subsidiary
Ltd.
Wu Guoren Minority shareholder of subsidiary
Econ Holdings (Yantai) Co., Ltd. Minority shareholder of subsidiary
Zhu Xinming Minority shareholder of subsidiary
Liang Ruiling Minority shareholder of subsidiary
Dai Yaojin Minority shareholder of subsidiary
Xiao Yongsong Minority shareholder of subsidiary
Companies controlled by minority
Unifortune (Hong Kong) Co., Ltd.
shareholders of subsidiaries
The company controlled by the ultimate
Haiying Technology Group (Hong Kong) Co.,
controller of the minority shareholders of the
Ltd.
subsidiary
The company controlled by the ultimate
Chongqing Lvfeng Renewable Resources Co.,
controller of the minority shareholders of the
Ltd.
subsidiary
The company controlled by the ultimate
Jiangxi Meiji Enterprise Co., Ltd. controller of the minority shareholders of the
subsidiary
Chongqing Ruiyin Renewable Resources Co., The ultimate controller of the minority
Ltd. shareholders of the subsidiary
360
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Name Relationship with the Company
Shenzhen Junxing Communication Technology Companies controlled by directors of
Co., Ltd. subsidiaries
Shenzhen Konka Yifang Technology Co., Ltd. Affiliated subsidiary
Zhanxiang Electronic Technology Co., Ltd. Affiliated subsidiary
Chongqing Konka Fuze Real Estate Co., Ltd. Affiliated subsidiary
Chuzhou Kangjin Health Industry
Participating company
Development Co., Ltd.
Close family members of minority
Dai Rongxing
shareholders
Close family members of minority
Hu Jiawen
shareholders
(II) Related-party Transactions
1. Related transactions of purchase and sale of goods, provision and acceptance of
services
（1） Purchasing goods/receiving services
Same period of
Related party Content Reporting Period
last year
Haiying Technology Group (Hong Purchase of
6,855,261,976.07 1,816,674,632.68
Kong) Co., Ltd. goods
Purchase of
Chongqing Lvfeng Renewable
goods and 1,309,805,108.45
Resources Co., Ltd.
services
Chuzhou Hanshang Electric Appliance Purchase of
698,636,167.54 966,302,431.62
Co., Ltd. goods
Purchase of
Puchuang Jiakang Technology Co, Ltd. 373,695,088.37 48,793,853.67
goods
Shenzhen Jielunte Technology Co., Purchase of
90,173,202.26 163,434,289.73
Ltd. goods
Purchase of
Shenzhen Jinzhu Industry Co., Ltd 62,584,789.34 29,039,118.22
goods
361
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Same period of
Related party Content Reporting Period
last year
Purchase of
OCT Group Co., Ltd. and its
goods and 31,079,892.62 19,021,005.05
subsidiaries and associated enterprises
services
Purchase of
Chongqing Ruiyin Renewable
goods and 55,093,641.50
Resources Co., Ltd.
services
HOHOELECTRICAL&FURNITURE Purchase of
50,041,528.06
CO.,LIMITED goods
Dongguan Konka Electronics Smart Purchase of
15,988,606.86
Technology Co., Ltd. goods
Purchase of
Shenzhen Konka E-display Co., Ltd. goods and 13,372,446.76
services
Wanjun Technology (Kunshan) Co.,
Purchase of
Ltd. (formerly known as “Kunshan 6,317,019.16 5,787,467.53
goods
Konka Electronics Co., Ltd.”)
Shenzhen Trade Link Supply Chain Purchase of
5,617,295.12 146,267,088.53
Management Co., Ltd. goods
Purchase of
E3info (Hainan) Technology Co., Ltd. goods and 5,006,164.56
services
Purchase of
Shenzhen Konka Information Network
goods and 2,798,788.35 31,244,486.68
Co., Ltd.
services
Anhui Kaikai Sihjie E-commerce Co., Purchase of
306,706.67 23,713,758.38
Ltd. goods
Purchase of
Huanjia Group Co., Ltd. 434,647,381.86
goods
Purchase of
Subtotal of other related parties goods and 5,158,078.73 22,702,314.29
services
362
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
（2） Information of sales of goods and provision of labor service
Same Period of
Related party Content Reporting Period
last year
Sales of
Anhui Kaikai Sihjie E-commerce Co., goods and
443,843,708.04 582,052,622.44
Ltd. render labor
service
Sales of
HOHOELECTRICAL&FURNITUREC goods and
115,451,594.04 56,895,724.52
O.,LIMITED render labor
service
Sales of
OCT Group Co., Ltd. and its goods and
112,863,678.04 127,353,778.04
subsidiaries and associated enterprises render labor
service
Sales of
Shenzhen Konka Smart Electrical goods and
75,623,621.40
Apparatus Technology Co., Ltd. render labor
service
Shenzhen Jielunte Technology Co., Ltd. Sales of
66,305,912.40 22,467,519.24
and its subsidiaries goods
Sales of
Chuzhou Hanshang Electric Appliance goods and
47,780,642.42 42,844,475.34
Co., Ltd. render labor
service
Shandong Konka Smart Electrical Sales of
47,720,206.98 76,954,416.15
Appliance Co., Ltd. goods
Henan Konka Smart Electrical Sales of
35,730,677.80 39,294,628.59
Appliance Co., Ltd. goods
Sales of
Shenzhen Konka E-display Commercial goods and
33,606,160.84 19,335,967.50
Display Co., Ltd. render labor
service
363
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Same Period of
Related party Content Reporting Period
last year
Sales of
Shenzhen Yaode Technology Co., Ltd. 32,701,728.34 372,927,101.60
goods
Sales of
goods and
E3info (Hainan) Technology Co., Ltd. 17,158,367.26
render labor
service
Sales of
AUJET INDUSTRY LIMITED 9,332,254.17 245,808,684.12
goods
Render
Feidi Technology (Shenzhen) Co., Ltd.
labor 4,338,841.78
and its subsidiaries
service
Sales of
Unifortune (Hong Kong) Co., Ltd. 3,582,516.56
goods
Sales of
Shenzhen Konka Information Network goods and
2,701,125.58 4,350,063.13
Co., Ltd. render labor
service
Heilongjiang Longkang Smart Sales of
5,837.17 17,497,025.47
Electrical Appliance Co., Ltd. goods
Wanjun Technology (Kunshan) Co.,
Sales of
Ltd. (formerly known as “Kunshan 2,182,486.57
goods
Konka Electronics Co., Ltd.”)
Sales of
Shenzhen Trade Link Supply Chain goods and
28,711,000.66
Management Co., Ltd. render labor
service
Dongguan Konka Electronics Smart Sales of
22,454,105.62
Technology Co., Ltd. goods
Sales of
goods and
Subtotal of other related parties 3,415,674.73 6,238,691.36
render labor
service
364
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. Information on Related-party Lease
（1）Lease situation
The lease fee
The lease fee
confirmed in
confirmed in
Leasee Lessee's name Category the same
the Reporting
period of last
Period
year
Commercial
OCT Group Co. Ltd.
Konka Group Co., Ltd. residences and 1,793,893.44 1,640,143.78
And its subsidiaries
office buildings
Konka Ventures Commercial
OCT Group Co. Ltd.
Development (Shenzhen) residences and 25,095,479.94
And its subsidiaries
Co., Ltd. office buildings
3. Information on Related-party Guarantee
（1）The Company was guarantor
Executio
Guarantee
n
amount Currenc
Secured party Start date End date accompli
(RMB’0,000 y
shed or
)
not
Ningbo
Kanghanrui 6,000.00 CNY 2020-7-27 2021-7-26 Not
Electric
Kunshan
Kangsheng
Investment 24,500.00 CNY 2019-9-23 2022-9-22 Not
Development
Co., Ltd.
Pengrun
5,000.00 CNY 2020-8-25 2021-8-25 Not
Technology
Anhui
4,500.00 CNY 2019-8-1 2020-8-1 Not
Tongchuang
365
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Anhui
3,000.00 CNY 2019-11-5 2020-11-4 Not
Tongchuang
Anhui
5,000.00 CNY 2019-12-25 2020-12-25 Not
Tongchuang
Anhui
3,500.00 CNY 2020-1-13 2021-1-13 Not
Tongchuang
Anhui
5,800.00 CNY 2020-3-11 2021-3-11 Not
Tongchuang
Anhui
3,000.00 CNY 2020-8-7 2021-8-5 Not
Tongchuang
Anhui
3,000.00 CNY 2020-10-19 2021-10-18 Not
Tongchuang
Dongguan
3,000.00 CNY 2020-1-16 2021-1-15 Not
Konka
Dongguan
2,000.00 CNY 2019-11-8 2024-11-5 Not
Konka
Electronics
6,000.00 CNY 2020-6-9 2021-6-8 Not
Technology
Electronics
10,000.00 CNY 2020-7-24 2021-6-28 Not
Technology
Electronics
50,000.00 CNY 2020-11-16 2021-5-22 Not
Technology
Electronics
8,000.00 CNY 2020-8-14 2021-6-9 Not
Technology
Econ
5,000.00 CNY 2019-11-14 2020-11-13 Not
Technology
Econ
8,800.00 CNY 2020-4-29 2021-4-28 Not
Technology
Econ
5,000.00 CNY 2020-5-25 2021-5-24 Not
Technology
Econ
24,000.00 CNY 2020-6-5 2021-3-17 Not
Technology
366
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Econ
5,000.00 CNY 2020-9-22 2021-9-21 Not
Technology
Econ
5,000.00 CNY 2020-8-21 2020-8-20 Not
Technology
Telecommunicat
7,500.00 CNY 2020-8-26 2021-8-26 Not
ion Technology
Sichuan Konka 4,000.00 CNY 2019-3-18 2022-3-19 Not
Yibin OCT
Sanjiang
14,000.00 CNY 2019-9-29 2022-9-28 Not
Properties Co.,
Ltd.
XingDa HongYe 5,800.00 CNY 2020-11-12 2022-11-12 Not
XingDa HongYe 2,000.00 CNY 2020-12-25 2023-12-25 Not
Boluo Konka
2,500.00 CNY 2019-2-20 2021-2-20 Not
Precision
Boluo Konka
2,480.11 CNY 2020-8-19 2023-8-19 Not
Precision
Jiangxi Konka 11,960.58 CNY 2019-3-18 2021-9-18 Not
Jiangxi Konka 5,500.00 CNY 2019-6-26 2022-6-25 Not
Jiangxi Konka 6,500.00 CNY 2019-10-30 2022-10-30 Not
Jiangxi Konka 990.00 CNY 2020-3-20 2022-3-19 Not
Jiangxi Konka 6,000.00 CNY 2020-6-28 2021-6-27 Not
Jiangxi Konka 3,000.00 CNY 2020-8-4 2021-8-4 Not
Jiangxi Konka 10,000.00 CNY 2020-9-29 2023-9-29 Not
Jiangxi Konka 10,000.00 CNY 2020-11-6 2023-12-6 Not
Jiangxi Konka 5,000.00 CNY 2020-12-21 2022-12-31 Not
Jiangxi Konka 1,000.00 CNY 2020-12-30 2023-12-30 Not
Nano
Crystallized 10,000.00 CNY 2019-6-26 2022-6-25 Not
Glass
Nano 5,000.00 CNY 2019-12-20 2022-12-20 Not
367
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Crystallized
Glass
Nano
Crystallized 5,000.00 CNY 2020-1-8 2023-1-8 Not
Glass
Nano
Crystallized 5,000.00 CNY 2020-1-8 2022-1-8 Not
Glass
Nano
Crystallized 990.00 CNY 2020-3-20 2022-3-19 Not
Glass
Nano
Crystallized 5,975.00 CNY 2020-5-29 2022-11-29 Not
Glass
Nano
Crystallized 7,000.00 CNY 2020-6-24 2021-6-23 Not
Glass
Nano
Crystallized 6,000.00 CNY 2020-7-14 2023-7-14 Not
Glass
Xinfeng
5,000.00 CNY 2020-5-19 2023-5-19 Not
Microcrystalline
Xinfeng
3,478.85 CNY 2020-5-29 2022-11-29 Not
Microcrystalline
Xinfeng
7,200.00 CNY 2020-6-18 2021-6-17 Not
Microcrystalline
Xinfeng
2,100.00 CNY 2020-12-8 2023-12-8 Not
Microcrystalline
Xinfeng
7,200.00 CNY 2020-12-28 2021-12-27 Not
Microcrystalline
Hong Kong
2,000.00 USD 2020-3-6 2021-2-19 Not
Konka
Hong Kong 20,000.00 CNY 2020-12-28 2021-9-9 Not
368
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Konka
Anhui Konka 10,000.00 CNY 2020-11-25 2021-11-24 Not
Anhui Konka 26,800.00 CNY 2020-12-24 2021-9-2 Not
Yibin Kangrun 10,000.00 CNY 2020-11-13 2024-12-31 Not
Rushan Econ 29,000.00 CNY 2016-12-29 2026-12-28 Not
Subei Kangrun
77,600.00 CNY 2020-3-10 2035-3-9 Not
Water
Wuhan Runyuan
55,200.00 CNY 2020-1-20 2040-1-19 Not
Wastewater
Dayi Kangrun
27,400.00 CNY 2020-4-29 2035-4-10 Not
Water
Sichuan Konka 14,000.00 CNY 2018-5-28 2027-5-24 Not
Xi'an Gaoling
Food Waste
Harmless
Treatment
24,571.00 CNY 2020-12-17 2035-12-16 Not
Franchise
Project
Cooperation
Agreement
（2）The Company was secured party
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
OCT Group Co.
200,000.00 CNY 2020-6-19 2022-6-19 Not
Ltd.
OCT Group Co.
500,000.00 CNY 2019-1-10 2023-7-21 Not
Ltd.
Shenzhen Musen
3,325.73 CNY 2019-3-19 2022-3-18 Not
Enterprise Co., Ltd.
369
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
Yantai Baijiangyuan
Business
23,851.98 CNY 2019-6-6 2021-6-1 Not
Management Center
(LP)
Yantai Fengqingtai
Investment Center 10,606.39 CNY 2019-6-6 2021-6-1 Not
(LP)
Yantai Qingrunyuan
Business
9,749.83 CNY 2019-6-6 2021-6-1 Not
Management Center
(LP)
Yantai
Qingjiangchuan
Business 676.29 CNY 2019-6-6 2021-6-1 Not
Management Center
(LP)
Yantai Baijiangyuan
Business
13,748.59 CNY 2019-4-23 2021-5-24 Not
Management Center
(LP)
Yantai Fengqingtai
Investment Center 6,113.66 CNY 2019-4-23 2021-5-24 Not
(LP)
Yantai Qingrunyuan
Business
5,619.93 CNY 2019-4-23 2021-5-24 Not
Management Center
(LP)
Yantai
Qingjiangchuan
389.82 CNY 2019-4-23 2021-5-24 Not
Business
Management Center
370
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
(LP)
Hu Zehong 980.00 CNY 2020-1-24 2021-1-23 Not
Hu Zehong 1,959.02 CNY 2020-4-21 2021-4-20 Not
Hu Zehong 490.00 CNY 2020-4-22 2021-4-20 Not
Hu Zehong 2,450.00 CNY 2020-8-4 2021-8-3 Not
Hu Zehong 183.75 CNY 2020-11-3 2021-11-2 Not
Hu Zehong 142.10 CNY 2020-11-4 2021-11-2 Not
Hu Zehong 1,014.30 CNY 2020-11-5 2021-11-2 Not
Hu Zehong 105.35 CNY 2020-11-16 2021-11-2 Not
Hu Zehong 24.50 CNY 2020-11-30 2021-11-2 Not
Hu Zehong 343.00 CNY 2020-12-31 2021-1-31 Not
Hu Zehong, Liang
5,800.00 CNY 2020-11-12 2022-11-12 Not
Ruiling, Dai Yaojin
Hu Zehong, Liang
2,000.00 CNY 2020-12-25 2023-12-25 Not
Ruiling, Dai Yaojin
Chuzhou
State-owned Assets
2,200.00 CNY 2020-11-25 2021-11-24 Not
Management Co.,
Ltd.
Chuzhou
State-owned Assets
5,896.00 CNY 2020-12-24 2021-9-2 Not
Management Co.,
Ltd.
Jiangxi Xinzixin
Real Estate Co., 14,161.00 CNY 2020-10-12 2021-10-11 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 4,900.00 CNY 2020-11-6 2023-11-6 Not
Ltd., Zhu Xinming
371
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
Jiangxi Xinzixin
Real Estate Co., 5,860.69 CNY 2019-3-18 2021-9-18 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,940.00 CNY 2020-6-28 2021-6-27 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,695.00 CNY 2019-6-26 2022-6-25 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 3,185.00 CNY 2019-10-30 2022-10-30 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 485.10 CNY 2020-3-20 2022-3-19 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 1,470.00 CNY 2020-8-4 2021-8-4 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 4,900.00 CNY 2020-9-29 2023-9-29 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 490.00 CNY 2020-12-30 2023-12-30 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 3,528.00 CNY 2020-6-18 2021-6-17 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,450.00 CNY 2020-5-19 2023-5-19 Not
Ltd., Zhu Xinming
372
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
Jiangxi Xinzixin
Real Estate Co., 1,704.64 CNY 2020-5-29 2022-11-29 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 1,029.00 CNY 2020-12-8 2023-12-8 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 3,528.00 CNY 2020-12-28 2021-12-27 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co.,
Ltd., Zhu Xinming,
4,900.00 CNY 2019-6-26 2022-6-25 Not
Xiong Muzhi, Zeng
Xiaohong, Zhu
Chengfu
Jiangxi Xinzixin
Real Estate Co., 2,450.00 CNY 2019-12-20 2022-12-20 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,450.00 CNY 2020-1-8 2023-1-8 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,450.00 CNY 2020-1-8 2022-1-8 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 485.10 CNY 2020-3-20 2022-3-19 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,927.75 CNY 2020-5-29 2022-11-29 Not
Ltd., Zhu Xinming
373
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
Jiangxi Xinzixin
Real Estate Co., 3,430.00 CNY 2020-6-24 2021-6-23 Not
Ltd., Zhu Xinming
Jiangxi Xinzixin
Real Estate Co., 2,940.00 CNY 2020-7-14 2023-7-14 Not
Ltd., Zhu Xinming
Chuzhou Hanshang
Electric Appliance 4,533.96 CNY 2020-6-24 2021-5-20 Not
Co.,Ltd.
Shenzhen Guoxin
Micro-electronics 2,630.44 CNY 2020-8-22 2021-8-21 Not
Co., Ltd.
Yudong
Environmental
Protection 8,820.00 CNY 2019-8-24 2021-6-5 Not
Technology Co.,
Ltd.
Yuan Shengxiang CNY 2019-8-24 2021-6-5 Not
Shenzhen
Henglongtong
1,041.09 CNY 2021-1-1 2021-12-31 Not
Technology Co.,
Ltd.
Huaying Gaokede 40,146.00 CNY 2018-1-1 2021-12-31 Not
Electronic Technology
Co., Ltd.
Huaying Gaokelong 40,146.00 CNY 2018-1-1 2021-12-31 Not
Electronic Technology
Co., Ltd.
Guizhou Huajinrun
Technology Co. 5,740.57 USD 2021-1-1 2021-12-31 Not
Ltd.
Shenhzhen Trade
7,331.18 USD 2018-9-27 2021-4-30 Not
Link Supply Chain
374
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Guarante Execution
e amount Curren Start accomplis
Guarantor: End date
(RMB’0,0 cy date hed or
00) not
Management Co.,
Ltd.
AUJET
INDUSTRY 21,641.85 USD 2018-5-17 2021-4-30 Not
LIMITED
Shenzhen
Unifortune Supply
8,856.25 USD 2019-7-12 2023-6-30 Not
Chain Management
Co., Ltd.
Shenzhen
Unifortune Supply
14,438.56 USD 2018-1-1 2023-6-30 Not
Chain Management
Co., Ltd.
Wu Guoren and
5,914.82 USD 2018-8-21 2023-12-31 Not
Xiao Yongsong
Wu Guoren and
43,481.93 USD 2019-1-1 2023-12-31 Not
Xiao Yongsong
Electronics
50,000.00 CNY 2019-9-26 2020-9-25 Not
Technology
Electronics
50,000.00 CNY 2019-9-27 2020-9-26 Not
Technology
4. Borrowings of Funds
Curre
Name Amount Start date Due date Note
ncy
Borrowing
OCT Group Co. Ltd. 111,060,000.00 CNY 2020/11/12 2022/12/09
OCT Group Co. Ltd. 500,000,000.00 CNY 2020/12/07 2022/12/09
Econ Holdings (Yantai) Co., Ltd. 37,559,970.00 CNY 2020/11/23 2021/11/22
E3info (Hainan) Technology Co., 50,000,000.00 CNY 2020/12/05 2021/06/04
375
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Curre
Name Amount Start date Due date Note
ncy
Ltd.
Chuzhou Hanshang Electric
134,750,000.00 CNY 2020/02/01 2021/01/31
Appliance Co., Ltd.
Total 833,369,970.00
Lending
Yibin OCT Sanjiang Properties
35,000,000.00 CNY 2020/04/25 2021/04/24
Co., Ltd.
Yibin OCT Sanjiang Properties
40,000,000.00 CNY 2018/10/25 2021/10/24
Co., Ltd.
Chongqing Konka Fuze Real Estate
188,430,000.00 CNY 2020/11/25 2021/11/24
Co., Ltd.
Chongqing Qingjia Electronics
8,900,000.00 CNY 2019/04/12 2020/04/11
Co., Ltd.
Yantai Kangyue Investment Co.,
128,527,000.00 CNY 2020/12/16 2021/12/15
Ltd.
Chuzhou Kangxin Health Industry
132,880,000.00 CNY 2020/10/20 2021/08/23
Development Co., Ltd.
Chuzhou Kangxin Health Industry
20,000,000.00 CNY 2020/12/10 2021/12/09
Development Co., Ltd.
Chuzhou Kangjin Health Industry
58,800,000.00 CNY 2020/09/16 2021/09/15
Development Co., Ltd.
Chuzhou Kangjin Health Industry
77,547,400.00 CNY 2020/02/27 2021/01/12
Development Co., Ltd.
Chuzhou Kangjin Health Industry
24,500,000.00 CNY 2020/06/15 2021/06/14
Development Co., Ltd.
Dongguan Konka Investment Co.,
22,231,944.48 CNY 2020/08/06 2021/08/05
Ltd.
Dongguan Konka Investment Co.,
7,000,000.00 CNY 2020/08/14 2021/08/05
Ltd.
Dongguan Konka Investment Co.,
166,768,055.5 CNY 2020/08/14 2021/08/05
Ltd.
376
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Curre
Name Amount Start date Due date Note
ncy
Total 910,584,399.98
5. Assets Transfer of Related Party
Same period of
Name Content Reporting Period
last year
Shenzhen Konka Holding Group Assignment of
188,200,000.00 -
Co., Ltd. patent rights
Shenzhen Konka Holding Group
Equity transfer 470,986,530.00 -
Co., Ltd.
Shenzhen OCT Capital Investment
Equity transfer - 63,520,500.00
Management Co., Ltd.
Shanghai OCT Investment
Equity transfer - 122,254,344.00
Development Co., Ltd.
Shenzhen OCT Property
Equity transfer - 4,538,210.00
Commercial Development Co., Ltd.
Total 659,186,530.00 190,313,054.00
6. Information on Remuneration for Key Management Personnel
Reporting Period Same period of last year
Item
(RMB’0,000) (RMB’0,000)
Total remuneration 2,953.87 2,872.87
(III) Balances with Related Party
1. Accounts Receivable
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
Accounts receivable:
Anhui Kaikai Shijie
153,854,753.25 3,170,897.81 19,822,544.45 402,397.65
E-commerce Co., Ltd.
HOHOELECTRICAL&FU
124,721,168.78 6,447,669.98 112,180,062.15 2,277,255.26
RNITURECO.,LIMITED
377
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
OCT Group Co. Ltd. And
its subsidiaries, associated 68,938,082.60 1,503,214.49 21,207,204.72 430,506.25
enterprises
Shenzhen Yaode 12,181,165.6
134,098,413.80 119,160,752.64 2,426,038.42
Technology Co., Ltd. 8
Shenzhen Konka
Information Network Co., 38,956,293.90 5,163,003.42 38,384,430.47 1,536,141.16
Ltd.
Shenzhen Jielunte
Technology Co., Ltd. and its 38,228,985.16 974,569.50 75,330,999.32 1,645,079.86
subsidiaries
Shenzhen Konka E-display
12,709,150.65 343,432.80 63,110,212.25 1,281,137.31
Co., Ltd.
Wanjun Technology
(Kunshan) Co., Ltd.
(formerly known as 235,078.99 4,772.10
“Kunshan Konka
Electronics Co., Ltd.”
Subtotal of other related
67,279,675.44 5,088,645.55 13,829,893.57 1,940,210.75
parties
34,872,599.2 11,943,538.7
Total 638,786,523.58 463,261,178.56
3 6
Notes receivable:
Anhui Kaikai Shijie
2,231,739.87 37,000,000.00
E-commerce Co., Ltd.
Subtotal of other related
2,243,687.84 6,739,171.02
parties
Total 4,475,427.71 43,739,171.02
Interest receivable:
Chuzhou Kangjin Health
Industry Development Co., 7,564,562.01 1,120,466.66
Ltd.
378
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
Yantai Kangyue Investment
10,910,514.22
Co., Ltd.
Chongqing Konka Fuze
15,828,119.98
Real Estate Co., Ltd.
Chongqing Qingjia
1,244,022.19
Electronics Co., Ltd.
Total 34,303,196.21 2,364,488.85
Dividends receivable
Chongqing Qingjia
547,848.62 547,848.62
Electronics Co., Ltd.
Binzhou Beihai Weiqiao
Solid Waste Treatment Co., 4,400,000.00
Ltd.
Dai Rongxing 4,947,848.62 547,848.62
Other receivables:
Chongqing Liangshan
Industrial Investment Co., 262,878,000.00 5,362,711.20
Ltd.
Haiying Technology Group
247,361,920.74 5,046,183.18
(Hong Kong) Co., Ltd.
Jiangxi Meiji Enterprise 18,833,017.2
93,512,640.31 93,612,640.31 2,068,839.35
Co., Ltd. 9
21,175,816.9
Dai Rongxing 82,914,871.05 85,104,483.48 4,161,412.98
8
OCT Group Co., Ltd. and
14,223,018.1
its subsidiaries, associated 30,431,127.39 29,609,699.81 8,794,143.64
1
enterprises
Huanjia Group Co., Ltd. 23,065,103.20 9,226,041.28 23,065,103.20 4,613,020.64
HOHOELECTRICAL&FU
5,519,421.05 112,596.19
RNITURECO.,LIMITED
Hu Jiawen 251,625.20 12,300.31
379
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
Subtotal of other related
473,279.18 21,303.41 84,194.95 6,951.75
parties
74,000,687.6 19,656,668.6
Total 746,156,362.92 231,727,746.95
4 7
Prepayments:
Haiying Technology Group
306,033,571.06 439,434,346.00
(Hong Kong) Co., Ltd.
Shenzhen Konka
Information Network Co., 40,220,535.22 40,983,577.99
Ltd.
Shenzhen Jielunte
Technology Co., Ltd. and its 13,483,626.36 13,763,739.19
subsidiaries
HOHOELECTRICAL&FU
7,655,079.81
RNITURECO.,LIMITED
Puchuang Jiakang
5,111,181.00 39,920,926.00
Technology Co, Ltd.
Shenzhen Unifortune
Supply Chain Management 28,623,157.08
Co., Ltd.
Subtotal of other related
5,647,733.34 883,108.32
parties
Total 378,151,726.79 563,608,854.58
Current portion of
non-current assets:
OCT Group Co., Ltd. and
its subsidiaries, associated 75,000,000.00 60,000,000.00
enterprises
Feidi Technology
30,630,065.09 31,827,347.83
(Shenzhen) Co., Ltd.
380
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
Subtotal of other related
6,873,893.20
parties
Total 105,630,065.09 98,701,241.03
Other current assets:
Chongqing Konka Fuze
188,430,000.00
Real Estate Co., Ltd.
Dongguan Konka
196,000,000.00
Investment Co., Ltd.
Chuzhou Kangjin Health
Industry Development Co., 160,847,400.00 58,800,000.00
Ltd.
Chuzhou Kangxin Health
Industry Development Co., 152,880,000.00
Ltd.
Yantai Kangyue Investment
128,527,000.00 128,983,984.89
Co. Ltd.
Total 826,684,400.00 187,783,984.89
Long-term receivables:
Feidi Technology
(Shenzhen) Co., Ltd. and its 12,749,762.58 37,980,796.18
subsidiaries
Subtotal of other related
parties 421,998.80
Total
Total 12,749,762.58 38,402,794.98
Other non-current assets:
OCT Group Co., Ltd. and
its subsidiaries, associated 40,000,000.00
enterprises
Chongqing Qingjia
10,867,888.84 8,900,000.00
Electronics Co., Ltd.
381
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance Beginning balance
Related party
Carrying amount Bad debt Carrying amount Bad debt
provision provision
Total 10,867,888.84 48,900,000.00
2. Accounts Payable
Related party Ending carrying amount Beginning carrying
Accounts payable: amount
Chongqing Lvfeng Renewable Resources 18,510,819.80
Co., Ltd.
Shenzhen Jielunte Technology Co., Ltd. and 12,618,777.74 35,164,809.08
its subsidiaries
OCT Group Co., Ltd. and its subsidiaries, 10,042,155.58
associated enterprises
Anhui Kaikai Shijie E-commerce Co., Ltd. 2,633,353.42 60,733,455.22
Wanjun Technology (Kunshan) Co., Ltd. 434,816.51 13,012,382.66
(formerly known as “Kunshan Konka
Electronics Co., Ltd.”)
Subtotal of other related parties 38,370,021.37 20,584,918.26
Total 82,609,944.42 129,495,565.22
Notes payable:
Subtotal of other related parties 17,085,784.47 10,863,352.03
Total 17,085,784.47 10,863,352.03
Contract liabilities/other non-current
liabilities:
Shenzhen Jielunte Technology Co., Ltd. and 27,430,700.76
its subsidiaries
OCT Group Co., Ltd. and its subsidiaries, 15,357,854.41 15,378,600.41
associated enterprises
Wanjun Technology (Kunshan) Co., Ltd.
(formerly known as “Kunshan Konka 16,903.16 13,150,116.07
Electronics Co., Ltd.”)
382
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Related party Ending carrying amount Beginning carrying
Shenzhen Unifortune Supply Chain amount
28,673,472.74
Management Co., Ltd.
Subtotal of other related parties 4,501,631.71 395,776.64
Total 47,307,090.04 57,597,965.86
Other payables:
Chuzhou Hanshang Electric Appliance Co., 151,494,362.56 94,093,715.34
Ltd.
Chongqing Lvfeng Renewable Resources 5,800,221.60
Co., Ltd.
E3info (Hainan) Technology Co., Ltd. 50,166,438.36
Feidi Technology (Shenzhen) Co., Ltd. and 13,215,861.75 11,767,561.85
its subsidiaries
Shenzhen Jielunte Technology Co., Ltd. and 786,209.02 10,240,000.00
its subsidiaries
Shenzhen Yaode Technology Co., Ltd. 280,000.00 39,727,606.67
Subtotal of other related parties 6,178,569.39 7,224,602.98
Total 227,921,662.68 163,053,486.84
Current portion of non-current liabilities:
OCT Group Co., Ltd. and its subsidiaries 10,777,675.49 7,512,375.00
Total 10,777,675.49 7,512,375.00
Long-term payables:
OCT Group Co., Ltd. and its subsidiaries and 40,485,591.71 41,434,396.98
associates
Total 40,485,591.71 41,434,396.98
XII. Contingency
(1) As the company holds commercial bills guaranteed to be accepted by Jiangsu Hongtu
High-Tech Co., Ltd., the acceptor has not paid the bills after maturity. The company, as the
plaintiff, filed a lawsuit with the court for bills with a total amount of 200 million yuan. The
debtors Hongtu Sanpower Technology Co., Ltd., Jiangsu Hongtu High Technology Co., Ltd.,
Sanpower Group Co., Ltd., Nanjing Jiongjiong Electronic Technology Co., Ltd., and Shenzhen
383
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Qianhai Benniu Agricultural Technology Co., Ltd. bear joint and several liability for the
settlement of the bill amount and overdue interest. In July 2019, the company filed a lawsuit with
the court, and the court has preserved the defendant's corresponding property. As of the date of
issuance of this report, property execution is ongoing.
(2) The Company held commercial acceptance bills of Shanghai Huaxin International Group
Co., Ltd., while the acceptor failed to accept the matured bills. The Company as the plaintiff filed
a lawsuit for bills of RMB 300,018,021.01 to the court, asked bill acceptor and Shanghai Huaxin
International Group Co., Ltd. involves bills before hand the bill amount and default interest shall
bear joint liability. As of the date of issuance of this report, the case involving 150 million yuan in
the case has been in the compulsory execution stage, and the shareholder has been added as the
person to be executed in the case; the courts of the remaining 150 million cases have ruled that
the defendant should pay bills and interest to Konka Group Enforced. As of the date of issuance
of this report, property execution is ongoing.
(3) The Company held commercial acceptance bills of China Nuclear Engineering &
Construction Group Corporation Limited, while the acceptor failed to accept the matured bills.
The Company as the plaintiff filed a lawsuit for bills of RMB 78,300,690.24 to court among
companies and involves bills before hands the bill amount and default interest shall bear joint
liability, and applied for property preservation. As of the date of issuance of this report, more than
1.75 million yuan has been frozen in the defendant's bank account; The court has ordered the
defendant to pay the bill and the corresponding interest to Konka Group, and the case is being
executed.
(4) The Company’s subsidiary, Konka Factoring held commercial acceptance bills of
CCCC First Harbor Engineering Co., Ltd., while the acceptor failed to accept the matured bills.
The Company as the plaintiff filed a lawsuit for bills of RMB 65,221,300.00 to court among
companies and involves bills before hands the bill amount and default interest shall bear joint
lThe Company held commercial acceptance bills of Shanghai Huaxin International Group Co.,
Ltd., while the acceptor failed to accept the matured bills. The Company as the plaintiff filed a
lawsuit for bills of RMB 300,018,021.01 to the court, asked bill acceptor and Shanghai Huaxin
International Group Co., Ltd. involves bills before hand the bill amount and default interest shall
bear joint liability. As of the date of issuance of this report, the case involving 150 million yuan in
the case has been in the compulsory execution stage, and the shareholder has been added as the
person to be executed in the case; the courts of the remaining 150 million cases have ruled that
the defendant should pay bills and interest to Konka Group Enforced. As of the date of issuance
of this report, the property has not yet been implemented.iability. As of the date of this report, the
case is still on trial and the above commercial acceptance bill has not been honored.
(5) The dispute among the Company and China Energy Electric Fuel Co., Ltd., China
Energy (Shanghai) Enterprise Co., Ltd., Shanghai Nengping Enterprise Co., Ltd. and Shenzhen
384
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Qianhai Baoying Commercial Factoring Co., Ltd. over the right of recourse for bills involves the
amount of the subject matter of the lawsuit to be RMB 50 million and the corresponding interest.
In September 2018, the Company filed a lawsuit with Shenzhen Intermediate People’s Court,
which has preserved the defendant’s corresponding property. The judgment of this case has come
into effect. In the court's judgment, defendants such as China Energy Electric Fuel Co., Ltd. shall
pay the bill amount of RMB50 million and the relevant interest to the Company. As of the
issuance date of this report, the case was in the execution stage and has applied to the court for
additional shareholders to be the executor.
(6) The dispute in bill recourse among the subsidiary of the Company, Konka Factoring
(Shenzhen) Co., Ltd., Tahoe Group Co., Ltd., Fuzhou Taijia Enterprise Co., Ltd. and Xiamen
Lianchuang Micro-electronics Co., Ltd., has involved with the underlying amount of RMB 50
million and relevant interest. In January 2019, the Company filed a lawsuit to Xiamen Municipal
Intermediate People’s Court, and the Company has applied for property preservation to the court.
As of the issuance date of this report, the case has not given judgment.
(7) The loan contract disputes related to the Company’s subsidiary Jiangxi Konka and its
subsidiary Xinfeng Microcrystaline, Nanocrystalline, China Great Wall AMC Jiangxi Branch,
Zhu Xinming, Leng Sumin, Jiangxi Xinzixin, Jiangxi Xinxin Jian’an Engineering, Jiangxi
Zhongyi Decorative Material, Jiangxi Shanshi Science and Technology and etc. Due to the
affiliated parties of Jiangxi Konka’s original shareholder, i.e. Jiangxi Xinxin Jian’an Engineering,
Jiangxi Zhongyi Decorative Material, Jiangxi Shanshi Technology, failed to repay the loan on
schedule. Therefore, China Great Wall AMC Jiangxi Branch filed a lawsuit and demanded Jiangxi
Xinxin Jian’an Engineering, Jiangxi Zhongyi Decorative Material, Jiangxi Shanshi Science and
Technology to repay the loan principal of RMB 300 million, liquidated damages of RMB 108,000
and interest of RMB 13.65 million. Guarantors Jiangxi Konka, Zhu Xinming, Leng Sumin, Nano
Crystallized Glass and Xinfeng Microcrystaline were required to bear joint liability for the above
debts.
On October 31, 2019, the Jiangxi Provincial Superior People’s Court ruled in first instance
that Jiangxi Xinxin Jian’an Engineering, Jiangxi Zhongyi Decorative Material, Jiangxi Shanshi
Technology would repay the loan principal of RMB 100 million, interest and liquidated damages
to China Great Wall AMC Jiangxi Branch within 10 days from the effective date of the judgment
respectively. Jiangxi Konka, Zhu Xinming, Leng Sumin, Nano Crystallized Glass and Xinfeng
Microcrystaline shall bear joint and several liabilities for all debts determined by the above
judgment. The defendants have appealed against the judgment of the first instance, and the
Supreme People's Court has accepted the case. As of the date of issuance of this report, the case is
still under trial.
The actual controller of Konka New Materials, Zhu Xinming, and his spouse, Leng Sumin,
as guarantors, provided a total of about RMB 143 million of real estate mortgage guarantee to
385
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Great Wall AMC for the above loans. Zhu Xinming and Leng Sumin also provided joint liability
guarantees. In order to avoid the adverse impact of this case on the Company, the Company has
agreed in the acquisition agreement of Jiangxi Konka, Xinfeng Microcrystalline and nanometer
microcrystalline that all contingent debts incurred by Jiangxi Konka by the original shareholders
of Konka new material in the form of joint and several liability. Jiangxi Xinzixin Real Estate Co.,
ltd. has held a total of about RMB 243 million of real estate assets as the case of the
anti-guarantee mortgage to Konka group and went through the mortgage registration procedures.
As of the date of this report, the case is still on trial and the above commercial acceptance bill has
not been honored.
(8) The company's subsidiary Konka Huanjia Environmental Protection Technology Co., Ltd.
and Huanjia Group Co., Ltd., Dalian Jinshunda Material Recycling Co., Ltd. and other 14
companies have filed a case involving disputes over the sale and purchase contract, and the
amount involved in the litigation is RMB 568,491,466.67. Konka Huanjia Environmental
Technology Co., Ltd. has applied for the court to seal up and freeze the defendant's corresponding
property. As of the date of issuance of this report, no effective judgment has been issued for this
case.
(9) The company holds bank acceptance bills accepted by Tianjin Materials Group Finance
Co., Ltd., and the acceptor did not redeem the bills after maturity. Therefore, as the plaintiff, the
company filed a lawsuit with the court for the bills with a total amount of RMB200,000,000.00
and requested the bills to be handed over to Wuhan Jialian Agricultural Technology Development
Co., Ltd. shall be liable for the settlement of the bill amount and default interest. As of the date of
issuance of this report, the case is still under trial, and the above-mentioned commercial
acceptance bill has not yet been paid.
(10) The dispute in sales contract between the subsidiary of the Company, Dongguan Konka
and Dongguan Gaoneng Polymer Materials Co., Ltd., Wang Dong, Shenzhen Xinlian Xingyao
Trading Co., Ltd., Shenzhen Jinchuan Qianchao Network Technology Co., Ltd., Puning Junlong
Trading Co., Ltd., Huang Zhihao have involved in RMB 89,405,998.78 (including RMB
52,718,868.54 of overdue payment, the corresponding liquidated damages and litigation costs). In
December 2020, the company filed a lawsuit with the court, and the case is currently being heard
in Shenzhen Nanshan District People's Court. As of the date of issuance of this report, no
effective judgment has been issued for this case.
(11) The dispute over liability for freight forwarding contracts at sea and in sea areas
between the subsidiary of the Company, Anhui Konka and Shanghai Triangle Link Logistics Co.,
Ltd. Shenzhen Branch and Shanghai Triangle Link Logistics Co., Ltd. have involved in RMB
37,966,066.73. In January 2020, the company filed a lawsuit with the court, and the case is
currently being heard by the Shanghai Higher People's Court. As of the date of issuance of this
report, no effective judgment has been issued for this case.
386
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
(12) The dispute in capital increase among the subsidiary of the Company, Shenzhen
Nianhua, Fang Xianglong and Jiang Yan has involved in RMB 20,451,631.52, and Shenzhen
Nianhua has applied for property preservation to the court. As of the date of issuance of this
report, the case has been completed, and the Shenzhen Court of International Arbitration has
issued an award, which is currently being implemented.
XIII. Commitment and Contingency
1. Capital Commitments
Item Ending balance Beginning balance
Commitments signed but hasn’t been
recognized in financial statements
—Commitment on construction and purchase
277,628,800.00
of long-lived assets
—Contract with large amount 4,310,308,187.10 3,889,900,964.09
—Foreign investment commitments 103,090,000.00
Total 4,587,936,987.10 3,992,990,964.09
2. Operating Lease Commitments
As of the balance sheet date, the irrevocable operating lease commitments that the Company
signed were as followed:
Item Ending balance Beginning balance
Minimum lease payments of irrevocable
operating lease
1 year after balance date 52,265,285.12 29,370,366.16
2 years after balance date 36,586,799.43 29,016,143.76
3 years after balance date 8,779,702.07 17,502,940.47
Following years 26,662,526.63 5,349,676.50
Total 124,294,313.26 81,239,126.89
3. Other Commitments
As of 31 December 2020, there were no other significant commitments for the Company to
disclose.
387
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
XⅣ. Events after Balance Sheet Date
1. Significant Non-adjusted Events
The impact of the implementation of the new accounting standards from January 1,
2021
The Ministry of Finance of the People’s Republic of China (hereinafter referred to as the
“Ministry of Finance”) issued the Notice on Revising and Issuing (CK No. [2018]35) in
December 2018, which shall be implemented from January 1, 2019 by companies listed in
both domestic and overseas markets that adopt IFRS or ASBE to prepare financial statements,
while other companies that adopts ASBE shall implement the Notice from January 1, 2021.
Main changes of new leasing criteria include: ① Under the new leasing criteria, except
for short-term leasing and low-value asset leasing, the lessee shall no longer distinguish
separate financial leasing and operating leasing, both of which shall follow the same
accounting treatment and recognize the right-of-use assets and leasing liabilities; ② For the
right-of-use assets, depreciation shall be accrued over the remaining useful life of the leased
assets when the lessee can reasonably determine that ownership of the leased asset can be
acquired at the expiration of lease term, otherwise, depreciation shall be accrued within the
lease term or remaining useful life of the leased asset, whichever is shorter. The lessee shall
also determine the occurrence of impairment of right-of-use assets, and conduct accounting
treatment for identified impairment loss; ③ For lease liabilities, the lessee shall calculate
interest expense of the lease liabilities during each period of the lease term and include it into
profits and losses of the current period; ④ For short-term lease and lease of low-value
assets, the lessee may choose not to recognize the right-of-use assets and lease liabilities, and
include them in the relevant asset costs or current profits and losses according to straight-line
method or other systematic and reasonable methods in each period of the leasing term. To
follow the convergence provisions of new leasing criteria, the Company adjusted the retained
earnings at the beginning of the current year and amounts of other relevant items in the
financial statements based on the cumulative impact of the first implementation of new
leasing criteria, without adjusting information of comparable periods. It is expected that the
implementation of new leasing criteria will not generate a significant impact on the current or
previous owner’s equity and net profit of the Company.
From January 1, 2021, Konka Group Co., Ltd. (hereinafter referred to as the "Company")
will change its accounting policies in accordance with the "Notice on Revising and Issuing of
the Accounting Standards for Business Enterprises No. 21- Leases".
388
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. No significant non-adjusted events
3. Profit distribution
Item Content
Based on the total share capital of 2,407,945,408
shares at the end of 2020, it is proposed to pay a cash
dividend of 1 yuan (including tax) for every 10
Profit or dividend declared to be paid
shares to all shareholders, and the distributed
after review and approval (pending
dividend is RMB240,794,540.80. The remaining
approval by the general meeting of
undistributed profits will be carried forward for
shareholders)
distribution in future years. No bonus shares will be
sent this time, and no accumulation fund will be
converted into increased share capital.
4. Sales returns
After the balance sheet date, no significant sales returns occurred.
5. Except for the above-mentioned disclosure of matters after the balance sheet date, the
Company has no other significant events after the balance sheet date.
XⅤ. Other Significant Events
The Company has no other significant events.
XVI. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Accounts Receivable
（1） Listed by Withdrawal Method of Expected Credit Loss
Ending balance
Carrying amount Bad debt provision
Category Withdra
Proporti wal Carrying value
Amount Amount
on (%) proporti
on (%)
Accounts receivable
948,510,887.48 18.22 552,922,400.60 58.29 395,588,486.88
for which expected
389
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Carrying amount Bad debt provision
Category Withdra
Proporti wal Carrying value
Amount Amount
on (%) proporti
on (%)
credit loss
withdrawn
separately
Accounts receivable
for which expected
credit loss
withdrawn by group
Of which: Aging
574,995,507.05 11.05 178,675,741.20 31.07 396,319,765.85
group
Related
3,681,343,439.12 70.73 3,681,343,439.12
party group
Subtotal of groups 4,256,338,946.17 81.78 178,675,741.20 4.20 4,077,663,204.97
Total 5,204,849,833.65 100.00 731,598,141.80 14.06 4,473,251,691.85
(Continued)
Beginning balance
Carrying amount Bad debt provision
Category Withdraw
Proportio al Carrying value
Amount Amount
n (%) proportio
n (%)
Accounts receivable
for which expected
851,581,146.54 8.52 243,095,956.82 28.55 608,485,189.72
credit loss withdrawn
separately
Accounts receivable
for which expected
credit loss withdrawn
by group
390
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Beginning balance
Carrying amount Bad debt provision
Category Withdraw
Proportio al Carrying value
Amount Amount
n (%) proportio
n (%)
Of which: Aging
562,863,234.05 5.63 176,154,824.04 31.30 386,708,410.01
group
Related
8,585,700,872.27 85.86 8,585,700,872.27
party group
Subtotal of groups 9,148,564,106.32 91.48 176,154,824.04 1.93 8,972,409,282.28
Total 10,000,145,252.86 100.00 419,250,780.86 4.19 9,580,894,472.00
1） Withdrawal of Expected Credit Loss Separately
Ending balance
Withdrawal
Name Bad debt
Carrying amount proportion Reason
provision
(%)
CEFC
(Shanghai) 300,018,021.01 240,014,416.81 80.00 Debt default
Group Co., Ltd.
Tewoo Group Judicial
200,000,000.00 90,000,000.00 45.00
Co., Ltd. reorganization
Jiangsu Hongtu
Sanbao
Agreement
High-Tech 200,000,000.00 80,000,000.00 40.00
reorganization
Technology Co.,
Ltd.
China Nuclear
Engineering
74,582,619.13 22,374,785.74 30.00 Increased credit risk
Construction
Group Co., Ltd.
CCCC No.1 Expected to be
55,438,105.00 48,915,975.00 88.24
Navigation difficult to recover in
391
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Withdrawal
Name Bad debt
Carrying amount proportion Reason
provision
(%)
Bureau No.1 full
Engineering Co.,
Ltd
Other 118,472,142.34 71,617,223.05 60.45
Total 948,510,887.48 552,922,400.60 58.29
2） Withdrawal of Expected Credit Loss by Group
1 Among Groups, Withdrawal of Expected Credit Loss by Aging
Ending balance
Aging Withdrawal
Carrying amount Bad debt provision
proportion (%)
Within 1 year 337,825,208.74 6,891,634.26 2.04
1 to 2 years 55,708,526.76 5,581,994.38 10.02
2 to 3 years 18,682,949.00 4,239,161.13 22.69
3 to 4 years 2,323,095.43 1,507,224.31 64.88
Over 4 years 160,455,727.12 160,455,727.12 100.00
Total 574,995,507.05 178,675,741.20 31.07
②Among Groups, Withdrawal of Expected Credit Loss by Adopting Other Method
Ending balance
Aging Withdrawal
Carrying amount Bad debt provision
proportion (%)
Related party group 3,681,343,439.12
Total 3,681,343,439.12
（2） Listed by aging group
Aging Ending balance
Within 1 year 3,562,326,085.73
392
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Aging Ending balance
1 to 2 years 772,416,357.56
2 to 3 years 650,373,734.58
3 to 4 years 48,616,790.62
Over 4 years 171,116,865.16
Total 5,204,849,833.65
731,598,141.80
4,473,251,691.85
（3） Information of Bad Debt Provision in the Reporting Period
Changed amount
Collec
Beginning
Category ted or Write-off or Ending balance
balance Withdrawn
revers verified
ed
Accounts
Receivable Bad 419,250,780.86 312,347,360.94 731,598,141.80
Debt Provision
Total 419,250,780.86 312,347,360.94 731,598,141.80
（4） Actual Verification of Accounts Receivable
No actual verified accounts receivable in the Reporting Period.
（5） Top 5 of the Ending Balance of the Accounts Receivable Collected according to
Arrears Party
Total amount of Top 5 of ending balance of accounts receivable collected according to
arrears party was RMB4,375,127,326.21 accounting for 84.06% of total ending balance of
accounts receivable. Total ending balance of bad debt provision withdrawn was
RMB410,014,416.81.
（6） There Was No Account Receivable Terminated the Recognition owning to the
Transfer of the Financial Assets.
（7） There Was No Asset and Liability Formed due to the Transfer of Accounts
Receivable and Continued Involvement in the Reporting Period.
393
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
2. Other Receivables
Item Ending balance Beginning balance
Interest receivable 41,138,869.97 7,431,353.86
Dividends receivable 749,431,635.50 518,580,871.02
Other receivables 9,244,298,847.60 10,026,808,690.59
Total 10,034,869,353.07 10,552,820,915.47
2.1 Interest receivable
Item Ending balance Beginning balance
Term deposits 6,830,211.26 4,807,630.04
loan by mandate 34,303,196.21 2,623,723.82
Entrustment loans 5,462.50
Total 41,138,869.97 7,431,353.86
2.2 Dividends receivable
Investee Ending balance Beginning balance
Hong Kong Konka Limited 250,808,720.00 214,987,200.00
Konka Factoring (Shenzhen) Co.,
70,000,000.00
Ltd.
Suining Konka Industrial Park
280,000,000.00
Development Co., Ltd.
Dongguan Konka Electronic Co.,
218,622,915.50 233,593,671.02
Ltd.
Total 749,431,635.50 518,580,871.02
2.3 Other receivables
（1） Classified by Account Nature
Nature Ending carrying amount Beginning carrying amount
Deposit and margin 9,180,409.27 383,449,285.99
Intercourse funds among
9,378,801,127.33 9,453,745,035.03
subsidiaries
Intercourse funds with other
118,043,953.69 182,971,639.02
related parties
394
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Energy-saving subsidy receivable 141,549,150.00 141,539,850.00
Other 89,315,201.21 52,265,159.90
Total 9,736,889,841.50 10,213,970,969.94
（2）Withdrawal of Bad Debt Provision
Phase I Phase II Phase III
Expected credit Expected credit
Expected credit losses for the losses for the
Bad debt provision Total
losses over the entire duration entire duration
next 12 months (no credit (with credit
impairment) impairment)
Balance on 1 January
7,296,330.73 17,404,579.39 162,461,369.23 187,162,279.35
2020
In the Reporting Period,
Carrying amount of other
receivables on 1 January
2020:
——Transferred to the
-157,153.93 157,153.93
Phase II
——Transferred to the
-410.58 -18,204.86 18,615.44
Phase III
——Transferred back to
the Phase II
——Transferred back to
the Phase I
Withdrawal -5,237,575.75 738,679.09 323,477,996.93 318,979,100.27
Recovery
Write-off
Verification 153,528.90 13,396,856.82 13,550,385.72
Other changes
Balance on 31
1,901,190.46 18,128,678.66 472,561,124.78 492,590,993.90
December 2020
395
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Note: The first stage is that credit risk has not increased significantly since initial recognition.
For other receivables with an aging portfolio and a low-risk portfolio within 1 year, the loss
provision is measured according to the expected credit losses in the next 12 months.
The second stage is that credit risk has increased significantly since initial recognition but
credit impairment has not yet occurred. For other receivables with an aging portfolio and a
low-risk portfolio that exceed 1 year, the loss provision is measured based on the expected credit
losses for the entire duration.
The third stage is the credit impairment after initial confirmation. For other receivables of
credit impairment that have occurred, the loss provision is measured according to the credit losses
that have occurred throughout the duration.
（3）Withdrawing bad debt provision for other receivables according to group
Ending balance
Carrying amount Bad debt provision
Category Withdr
Propo awal Carrying value
Amount Amount
rtion proport
ion
Other
receivables
with
significant
individual
amount and 1,764,691,060.74 18.00 472,561,124.78 26.78 1,292,129,935.96
make
independent
provision
for expected
credit loss
Other
receivables
withdrawn
bad debt
provision
according to
396
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Ending balance
Carrying amount Bad debt provision
Category Withdr
Propo awal Carrying value
Amount Amount
rtion proport
ion
credit risks
characteristi
cs
Aging group 128,885,012.86 1.00 15,447,446.31 11.99 113,437,566.55
Low-risk
17,273,953.16 4,582,422.81 26.53 12,691,530.35
group
Related
7,826,039,814.74 80.00 7,826,039,814.74
party group
Subtotal of
7,972,198,780.76 82.00 20,029,869.12 0.25 7,952,168,911.64
groups
Total 9,736,889,841.50 100.00 492,590,993.90 5.06 9,244,298,847.60
(Continued)
Beginning balance
Carrying amount Bad debt provision
Category Withd
Propo rawal Carrying value
Amount Amount
rtion propo
rtion
Other
receivables with
significant
individual
amount and 173,092,959.33 1.69 162,461,369.23 93.86 10,631,590.10
make
independent
provision for
expected credit
397
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
loss
Other
receivables
withdrawn bad
debt provision
according to
credit risks
characteristics
Aging group 196,772,672.55 1.93 16,787,423.23 8.53 179,985,249.32
Low-risk
390,582,659.31 3.82 7,913,486.89 2.03 382,669,172.42
group
Related party
9,453,522,678.75 92.55 9,453,522,678.75
group
Subtotal of
10,040,878,010.61 98.30 24,700,910.12 0.25 10,016,177,100.49
groups
Total 10,213,970,969.94 100.00 187,162,279.35 1.83 10,026,808,690.59
（4）Listed by aging
Aging Ending balance
Within 1 year 6,174,537,325.77
1 to 2 years 2,915,238,116.54
2 to 3 years 243,665,416.10
3 to 4 years 96,722,054.13
4 to 5 years 49,208,593.53
Over 5 years 257,518,335.43
Subtotal 9,736,889,841.50
Less: bad debt provision 492,590,993.90
Total 9,244,298,847.60
（5）Bad Debt Provision for Other Receivables
398
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
The amount of bad debt provision for this year was RMB318,979,100.27, and other
receivables actually written off in this period were RMB13,550,385.72.
（6）Other receivables with top five ending balances collected by debtors.
In this year, the total amount of the top five other receivables collected by debtors at the end
of the year was RMB7,395,358,555.11, accounting for 75.95% of the total amount of other
receivables at the end of the year, and the total amount of the corresponding accrued bad debt
reserves at the end of the year was RMB315,005,562.96.
（7）There Was No Other Receivables Terminated the Recognition owning to the Transfer
of the Financial Assets.
（8）There Was No Asset and Liability Formed by the Transfer and the Continues
Involvement of Other Receivables.
399
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
3. Long-term Equity Investment
（1）Category of Long-term Equity Investment
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserve reserve
Investment to
7,083,817,068.77 102,532,484.69 6,981,284,584.08 5,983,370,982.51 10,732,484.69 5,972,638,497.82
subsidiaries
Investment to
associates and joint 1,851,048,093.64 26,166,078.16 1,824,882,015.48 1,752,296,635.13 12,850,165.07 1,739,446,470.06
ventures
Total 8,934,865,162.41 128,698,562.85 8,806,166,599.56 7,735,667,617.64 23,582,649.76 7,712,084,967.88
（2）Investment to Subsidiaries
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
Konka Ventures 2,550,000.00 2,550,000.00
Anhui Konka 122,780,937.98 122,780,937.98
Konka Factoring 300,000,000.00 300,000,000.00
400
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
Konka Unifortune 15,300,000.00 15,300,000.00
Wankaida 10,000,000.00 10,000,000.00
Dongguan Konka 274,783,988.91 274,783,988.91
Life Electric
31,500,000.00 31,500,000.00
Appliance
Konka Europe 3,637,470.00 3,637,470.00
Commercial System
5,832,000.00 5,832,000.00
Technology
Konka Electrical
1.00 1.00 10,732,484.69
Appliances
Telecommunication
360,000,000.00 360,000,000.00
Technology
Mobile
20,000,000.00 80,000,000.00 100,000,000.00
Interconnection
Anhui Tongchuang 481,702,612.22 298,000,000.00 779,702,612.22
Kangjiatong 15,300,000.00 15,300,000.00
Konka Pengrun 25,500,000.00 25,500,000.00
401
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
E3info 12,000,000.00 12,000,000.00
Dongguan Packing 8,602,009.10 8,602,009.10
E2info 19,322,040.00 19,322,040.00
Beijing Konka
200,000,000.00 200,000,000.00
Electronic
Konka Circuit 48,750,000.00 42,250,000.00 91,000,000.00
Hong Kong Konka 781,828.61 781,828.61
Konka Investment 477,000,000.00 23,000,000.00 500,000,000.00
Electronics
1,000,000,000.00 1,000,000,000.00
Technology
Yantai Laikang
Econ Technology 688,500,000.00 688,500,000.00
Konka Huanjia 91,800,000.00 91,800,000.00 91,800,000.00 91,800,000.00
Shanghai Konka 40,000,000.00 40,000,000.00
Jiangxi Konka 689,680,000.00 689,680,000.00
Shenzhen Nianhua 30,000,000.00 30,000,000.00
402
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
Shenzhen
100,000,000.00 100,000,000.00
KONSEMI
Konka
50,000.00 50,000.00
Eco-Development
Suining Konka 200,000,000.00 200,000,000.00
Konka Ronghe 5,100,000.00 5,100,000.00
Suining Electronic
Technological 200,000,000.00 200,000,000.00
Innovation
Dongguan Konka
44,400,000.00 55,600,000.00 100,000,000.00
Investment
Shenzhen
Chuangzhi
10,000,000.00 10,000,000.00
Electrical
Appliances
Kanghong (Yantai)
Environmental 5,100.00 1,020,000.00 1,025,100.00
Protection
403
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
Chongqing
25,500,000.00 25,500,000.00
Kangxingrui
Chongqing
Optoelectronic 350,000,000.00 650,000,000.00 66,666,666.67 933,333,333.33
Institute
Xinying
14,000,000.00 42,000,000.00 56,000,000.00
Semiconductor
Jiangkang
(Shanghai)
Technology
Chongqing Real
25,500,000.00 25,500,000.00
Estate Development
Ningbo Kanghanrui
Electrical 9,000,000.00 81,000,000.00 90,000,000.00
Appliances
Konka Zhizao 510.00 510.00
Debao New
3,750,000.00 3,750,000.00
Material
404
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Provision for Ending balance
Investee Beginning balance Increase Decrease Ending balance impairment this of depreciation
year reserve
Technology
Suining Jiarun Real
10,000,000.00 10,000,000.00
Estate
Chuzhou Kangxin
30,000,000.00 30,000,000.00
Health Industry
Kangxinglong
Environmental 10,000.00 10,000.00
Protection
Yantai Kangyun 1,530,000.00 1,530,000.00
Chongqing Kanglei
Chongqing Kanglei 67,000,000.00 67,000,000.00
Henan Kangxin
Real Estate
Chongqing
25,500,000.00 25,500,000.00
Chengda
Konka Material 4,304,752.93 4,304,752.93
Total 5,972,638,497.82 1,401,204,752.93 300,758,666.67 7,073,084,584.08 91,800,000.00 102,532,484.69
405
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
（3）Investment to Joint Ventures and Associated Enterprises
Increase-decrease
Balance at the end of Adjustment of
Gains and losses
Investee last year at the Additional Reduced other
recognized under
beginning of the year investment investment comprehensive
the equity method
income
Anhui Kaikai Shijie E-commerce Co.,
23,529,741.15 -6,129,002.71
Ltd.
Wanjun Technology (Kunshan) Co.,
128,896,753.19 -7,317,169.02
Ltd.
Kunshan Kangsheng 175,254,554.65
Chutian Dragon Co., Ltd. 636,061,636.70 23,385,170.32
Helongjiang Longkang Zhijia
2,380,000.00 -1,279,157.71
Technology Co., Ltd.
Konka Green, Konka Technology 77,342,419.36 -2,081,114.80
Shaanxi Silk Road Cloud Intelligent
17,202,315.43 446,980.38
Tech Co., Ltd.
Shenzhen Konka Information Network
Co., Ltd.
Shenzhen Zhongbin Konka 7,273,228.41 -5,058,921.08
406
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase-decrease
Balance at the end of Adjustment of
Gains and losses
Investee last year at the Additional Reduced other
recognized under
beginning of the year investment investment comprehensive
the equity method
income
Technology Co., Ltd.
Shenzhen Konka Intelligent Electrical
2,882,149.72 930,984.56
Apparatus Co., Ltd.
Zhuhai Jinsu Plastic Co., Ltd. 10,166,404.14 10,549,865.19 383,461.05
Shenzhen Bosser New Materials Co.,
73,600,000.00 -1,884,086.91
Ltd.
Shenzhen Yaode Technology Co., Ltd. 229,740,245.47 -10,611,583.85
Wuhan Tianyuan Environmental
275,577,332.21 29,076,911.48
Protection Co., Ltd.
Konka E-display 14,399,858.75 -2,625,717.49
Chuzhou Konka Technology Industry
17,270,427.37 -11,371,102.98
Development Co., Ltd.
Chuzhou Kangjin Health Industrial
14,588,741.64 662,742.37
Development Co., Ltd.
Haimen Kangjian Technology 29,589,201.10 -10,544,214.33
407
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase-decrease
Balance at the end of Adjustment of
Gains and losses
Investee last year at the Additional Reduced other
recognized under
beginning of the year investment investment comprehensive
the equity method
income
Industrial Park Operations and
Management Co., Ltd.
Shenzhen Kangyue Enterprise Co.,
3,691,460.77 -343,163.72
Ltd.
Dongguan Konka Investment Co., Ltd. 49,004,878.51 -6,846,600.88
Chongqing Konka Real Estate
15,780,864.75 -2,438.71
Development Co., Ltd.
Chongqing Chengda Real Estate Co.,
16,500,000.00 -2,815,247.76
Ltd.
Chuzhou Kangxin Health Industry
14,700,000.00 4,242.50
Development Co., Ltd.
E3info (Hainan) Technology Co., Ltd. 28,256,240.41 8,318,369.32
Nanjing Kangxing Science and
Technology Industrial Park Operation 23,462,938.10 23,462,938.10
Management Co., Ltd.
408
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase-decrease
Balance at the end of Adjustment of
Gains and losses
Investee last year at the Additional Reduced other
recognized under
beginning of the year investment investment comprehensive
the equity method
income
Total 1,739,446,470.06 147,704,921.77 34,012,803.29 -5,700,659.97
(Continued)
Increase/decrease
Cash bonus or Ending balance
Withdrawal of Ending balance
Investee Other equity profits of depreciation
impairment Other (carrying value)
changes announced to reserve
provision
issue
Anhui Kaikai Shijie E-commerce Co.,
17,400,738.44
Ltd.
Wanjun Technology (Kunshan) Co.,
121,579,584.17
Ltd.
Kunshan Kangsheng 175,254,554.65
Chutian Dragon Co., Ltd. 9,240,000.00 650,206,807.02
Helongjiang Longkang Zhijia
1,100,842.29 2,470,398.03
Technology Co., Ltd.
409
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase/decrease
Cash bonus or Ending balance
Withdrawal of Ending balance
Investee Other equity profits of depreciation
impairment Other (carrying value)
changes announced to reserve
provision
issue
Shanghai Konka Technology Co., Ltd. 75,261,304.56
Shaanxi Silk Road Cloud Intelligent
17,649,295.81
Tech Co., Ltd.
Shenzhen Konka Information Network
5,158,909.06
Co., Ltd.
Shenzhen Zhongbin Konka
2,214,307.33
Technology Co., Ltd.
Shenzhen Konka Intelligent Electrical
3,813,134.28
Apparatus Co., Ltd.
Zhuhai Jinsu Plastic Co., Ltd.
Shenzhen Bosser New Materials Co.,
13,315,913.09 58,400,000.00 18,536,771.07
Ltd.
Shenzhen Yaode Technology Co., Ltd. 219,128,661.62
Wuhan Tianyuan Environmental
304,654,243.69
Protection Co., Ltd.
410
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase/decrease
Cash bonus or Ending balance
Withdrawal of Ending balance
Investee Other equity profits of depreciation
impairment Other (carrying value)
changes announced to reserve
provision
issue
Konka E-display 11,774,141.26
Chuzhou Konka Technology Industry
5,899,324.39
Development Co., Ltd.
Chuzhou Kangjin Health Industrial
15,251,484.01
Development Co., Ltd.
Haimen Kangjian Technology
Industrial Park Operations and 19,044,986.77
Management Co., Ltd.
Shenzhen Kangyue Enterprise Co.,
3,348,297.05
Ltd.
Dongguan Konka Investment Co., Ltd. 42,158,277.63
Chongqing Konka Real Estate
15,778,426.04
Development Co., Ltd.
Chongqing Chengda Real Estate Co.,
13,684,752.24
Ltd.
411
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Increase/decrease
Cash bonus or Ending balance
Withdrawal of Ending balance
Investee Other equity profits of depreciation
impairment Other (carrying value)
changes announced to reserve
provision
issue
Chuzhou Kangxin Health Industry
14,704,242.50
Development Co., Ltd.
E3info (Hainan) Technology Co., Ltd. 36,574,609.73
Nanjing Kangxing Science and
Technology Industrial Park Operation
Management Co., Ltd.
Total 9,240,000.00 13,315,913.09 1,824,882,015.48 26,166,078.16
412
Notes to the Financial Statements of Konka Group Co., Ltd.
January 1, 2020 to December 31, 2020
(Unless otherwise specified, the notes to this financial statement are all listed in RMB)
4. Operating Revenue and Cost of Sales
(1) Operating revenue and operating costs
Reporting Period Same Period of last year
Item Operating
Operating revenue Cost of sales Cost of sales
revenue
Main
2,769,474,547.4 5,036,032,864.0 4,960,650,274.9
operati 3,076,325,721.91
3 8 8
ons
Other
operati 638,561,930.58 506,745,792.19 650,069,282.90 452,981,509.79
ons
3,276,220,339.6 5,686,102,146.9 5,413,631,784.7
Total 3,714,887,652.49
2 8 7
(2)Information relating to the transaction price allocated to the remaining performance
obligation
At the end of this year, the amount of income corresponding to the performance obligations
that have been signed but not yet fulfilled or not fulfilled is 12,142,638.84 yuan, of which
12,142,638.84 yuan is expected to be recognized in 2021.
5. Investment Income
Same Period of
Item Reporting Period
last year
Long-term equity investment income accounted
585,217,964.13 537,735,966.91
by cost method
Long-term equity investment income accounted
-5,700,659.97 5,132,712.27
by equity method
Investment income from disposal of long-term
1,215,083,684.94 393,939,191.83
equity investment
Investment income from holding of trading
4,800,000.00 2,330,000.00
financial assets
Investment income from disposal of trading 3,405,333.03 -10,285,883.02
413
Notes to the Financial Statements of Konka Group Co., Ltd.
January 1, 2020 to December 31, 2020
(Unless otherwise specified, the notes to this financial statement are all listed in RMB)
Same Period of
Item Reporting Period
last year
financial assets
Income from entrust financial products and
19,038,445.39 70,346,322.45
entrust loans
Total 1,821,844,767.52 999,198,310.44
XVII. Approval of Financial Statements
The financial statement was approved on 22 March 2021 by the Board of Directors.
414
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
XVIII. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
Item Amount Note
Gain-Loss arising from disposal of non-current assets 2,431,648,255.26
Tax rebates, reductions or exemptions due to approval
beyond authority or the lack of official approval
documents
Government subsidies recognized in the current
period, except for those acquired in the ordinary
course of business or granted at certain quotas or 908,546,202.24
amounts according to the government’s unified
standards
Capital occupation charges on non-financial
enterprises that are recorded into current profit or loss
Gains due to that the investment costs for the
Company to obtain subsidiaries, associates and joint
ventures are lower than the enjoyable fair value of the
identifiable net assets of the investees when making
the investments
Gain/Loss on non-monetary asset swap
Gain/Loss on entrusting others with investments or
18,476,648.12
asset management
Asset impairment provisions due to acts of God such
as natural disasters
Gain/Loss from debt restructuring 1,127,066.94
Expenses on business reorganization, such as
expenses on staff arrangements, integration, etc.
Gain/Loss on the part over the fair value due to
transactions with distinctly unfair prices
Current net profit or loss of subsidiaries acquired in
business combination under the same control from
415
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Amount Note
period-beginning to combination date
Gain/Loss incurred from contingency unrelated to the
Company’s normal operating businesses.
Gain/loss from change of fair value of trading
financial assets and liabilities, and derivative financial
assets and liabilities, and investment gains from
disposal of trading financial assets and liabilities, and 96,316,772.78
derivative financial assets and liabilities, and
investment in other obligatory rights, other than valid
hedging related to the Company’s common businesses
Reverse of bad debt provision of accounts receivable
individually conducting impairment test
Gain/loss on entrustment loans 64,616,181.90
Gain/loss on change in fair value of investment
property of which the subsequent measurement is
carried out adopting fair value method
Effect on current profit or loss when a one-off
adjustment is made to current profit or loss according
to requirements of taxation, accounting and other
relevant laws and regulations
Custody fee income when entrusted with operation
Other non-operating income and expense other than
54,271,037.60
the above
Project confirmed with the definition of non-recurring
1,081,111.64
gains and losses
Subtotal 3,576,083,276.48
Less: Income tax effects 544,211,364.67
Non-controlling interests effects (after tax) 186,647,854.72
Total 2,845,224,057.09 —
（1） The explanation of the Company to “Project confirmed with the definition of non-recurring
gains and losses” and define non-recurring gains and losses as recurring gains and losses according to the
nature and features of normal business operations of company.
416
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2020 to 31 December 2020 (all amounts in RMB yuan unless otherwise stated)
Item Amount Reason
Government subsidies which
are closely related to the
normal business of the
Software tax refund 30,710,313.50 company and which are in
accordance with national
policies and certain standard
quota or quantitative amount
Total 30,710,313.50
2. Return on Equity and Earnings Per Share
Weighted average ROE EPS (Yuan/share)
Profit as of Reporting Period
(%) EPS-basic EPS-diluted
Net profit attributable to
ordinary shareholders of the 5.79 0.1984 0.1984
Company
Net profit attributable to
ordinary shareholders of the
-28.72 -0.9832 -0.9832
Company after deduction of
non-recurring profit or loss
417
Konka Group Co., Ltd. Annual Report 2020
Part XIII Documents Available for Reference
I. The financial statements with the signatures and seals of the Company’s legal representative,
Chief Financial Officer and head of the financial department;
II. The original copy of the Independent Auditor’s Report with the seal of the CPA firm and the
signatures & seals of the certified public accountants;
III. The originals of all the Company’s documents and announcements disclosed to the public via
newspapers designated by the CSRC in the Reporting Period; and
IV. Other relevant materials.
The Board of Directors
Konka Group Co., Ltd.
23 March 2021
418
