Sino Great Wall Co., Ltd. 2016 Annual Report
Sino Great Wall Co., Ltd.
2016 Annual Report
April 2017
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Sino Great Wall Co., Ltd. 2016 Annual Report
I. Important Notice, Table of Contents and Definitions
The Board of Directors and the directors, Supervisory Committee and supervisors and Senior Executives of
the Company hereby warrant that at the year , there are no misstatement, misleading representation or important
omissions in this report and shall assume joint and several liability for the authenticity, accuracy and completeness
of the contents hereof.
Mr.Chen Lue , The Company leader, Mrs. Cui Hongli, Chief financial officer and the Mrs. Xian Zhijuan, the
person in charge of the accounting department (the person in charge of the accounting )hereby confirm the
authenticity and completeness of the financial report enclosed in this annual report.
All the directors attended the board meeting for reviewing the Annual Report.
BDO China Shu Lun Pan CPAs (Special General Partnership) has issued a standard unqualified audit report for
the company. In 2016,This annual report involves the forecasting description such as the future plans, and does
not constitute the actual commitments of the company to the investors. The investors should pay attention to the
investment risks.
The company has detailedly described the possible risks existed in the company’s business operation and the
countermeasures, please refer to the contents about the possible risks for the company’s future development in the
fourth section-Discussion and Analysis of Business Operation in this report.
The company's profit distribution plan for the year is: Based on the company's existing share capital of
1,698,245,011 shares, it’s proposed that the company will distribute cash dividend of RMB 0.60 per 10 shares (tax
inclusive), with no bonus shares and no increasing shares by converting capital reserves into share capital.
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Sino Great Wall Co., Ltd. 2016 Annual Report
Table of Contents
I.Important Notice, Table of contents and Definitions
II. Basic Information of the Company and Financial index
III. Outline of Company Business
IV. Management’s Discussion and Analysis
V. Important Events
VI. Change of share capital and shareholding of Principal Shareholders
VII. Situation of the Preferred Shares
VIII. Information about Directors, Supervisors and Senior Executives
IX. Administrative structure
X. Corporate Bond
XI. Financial Report
XII. Documents available for inspection
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Sino Great Wall Co., Ltd. 2016 Annual Report
Definition
Terms to be defined Refers to Definition
Company Law Refers to Company Law of the People’s Republic of China
Securities Law Refers to Securities Law of the People’s Republic of China
“CSRC” Refers to China Securities Regulatory Commission
Company,The Company, Sino Great Wall Refers to Sino Great Wall Co., Ltd.
Sino International Refers to Sino Great Wall International Engineering Co., Ltd.
BDO Refers to BDO China Shu Lun Pan Certified Public Accountants LLP
SZSE Refers to Shenzhen Stock Exchange
Reporting period Refers to January 1,2016 to December 31,2016
Yatian Decoration Refers to Shenzhen Yatian Decoration Design Engineering Co., Ltd.
Union Development Refers to Union Development Group Co., Ltd.
Union Holdings Refers to Union Holdings Co., Ltd.
Rich Crown Investment Refers to Rich Crown Investment Co., Ltd.
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Sino Great Wall Co., Ltd. 2016 Annual Report
II. Basic Information of the Company and Financial index
I．Company Information
Stock abbreviation: Sino Great Wall Sino-B Stock code： 000018 200018
Change of stock Abbreviation
Nil
（If any）
Stock exchange for listing Shenzhen Stock Exchange
Name in Chinese 神州长城股份有限公司
Chinese Abbreviation 神州长城 神州 B
English name (If any) Sino Great Wall Co., Ltd.
English Abbreviation (If any) Sino Great Wall Sino-B
Registered address 26 Kuipeng Road, Kuiyong Town, Longgang District, Shenzhen
Postal code of the Registered
518119
Address
Office Address Sino Great Wall Building, No.3 Jinxiu Street,Economic Technology Development Zone , Beijing
Postal code of the office
100176
address
Internet Web Site www.sgwde.com
E-mail 000018sz@sina.com
II. Contact person and contact manner
Board secretary Securities affairs Representative
Name Yang Chunling Liu Guofa
Sino Great Wall Building, No.3 Jinxiu Sino Great Wall Building, No.3 Jinxiu
Contact address Street,Economic Technology Development Street,Economic Technology Development
Zone , Beijing Zone , Beijing
Tel 010-89045855 010-89045855
Fax 010-89045856 010-89045856
E-mail 1208806865@qq.com 000018sz@sina.com
III. Information disclosure and placed
Newspapers selected by the Company for information
Securities Times and Hongkong Commercial Daily.
disclosure
Internet website designated by CSRC for publishing
http: // www.cninfo. com. cn
the Annual report of the Company
The place where the Annual report is prepared and Secutities Department , Sino Great Wall Building, No.3 Jinxiu
placed Street,Economic Technology Development Zone , Beijing
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Sino Great Wall Co., Ltd. 2016 Annual Report
IV.Changes in Registration
Organization Code 91440300618801483A
On October 13, 2015, the company held the 26th board meeting of the sixth session
board of directors, at which the Proposal on Alteration of the Company’s Business
Scope was examined and approved. In the light of the major asset restructuring
conducted by the company, the main business of the company shall be significantly
changed. In order to meet the company’s development requirements, the company
planned to change the company’s business scope to “Engineering design and
construction, infrastructure investment, new energy construction and investment,
medical investment, life technology research and development, equipment
Changes in principal business activities
manufacturing, defense equipment, financial investment and real estate development
since listing (if any)
(Finally, the business scope shall be the business scope approved by the Administration
for Industry and Commerce) from the original business scope of “Production and
operation of the textile industry products and its required raw materials, accessories,
machinery and equipment, all kinds of fabrics and clothing and providing related
services(Do not contain the products included in the existing license management, if
has a license, then it will execute by the license). The Proposal on Alteration of the
Company’s Business Scope was examined and approved in the 2015 second
extraordinary general shareholder meeting which was convened on October 29, 2015,
On October 14, 2015, the company completed the share-issuing of a total of
251,849,593 shares issued to 17 transaction objects such as Chen Lue for purchasing
related assets, of which the issuing price is RMB 9.84 per share. Of which Chen Lue
Holdings held 138,340,890 shares, taking for 32.86% of the company’s share capital,
The Largest shareholder of the company was changed to Mr. Chen Lue form Union
Holdings Co., Ltd. And the actual controller of the Compnay was changed to Mr.
Chen Lue from Union Developemnt Co., Ltd.
On Nov 27, 2015, the company completed the non-public share-issuing to purchase the
assets and raise the matching funds. The total share quantity of the non-public
Changes is the controlling shareholder in
share-issuing for raising funds is 25,914,633 shares, with issuing price of RMB 9.84
the past (is any)
per share, of which Chen Lue subscribed 14,735,772 shares of the newly increasing
shares. After completing the non-public share-issuing, the company’s total share capital
shall be changed to 446,906,582 shares, of which Mr. Chen Lue holds 153,076,662
shares, taking for 34.25% of the company’s total share capital, remained as the
company’s actual controlling shareholder and the actual controller.
On May 6,2016, the company held the sharelolders meeting in 2016, at which the
Proposal concerning preplan for profit Distribution and Dividend Distribution for 2015
o was examined and approved.upon the base of total share capital of 446,906,582
shares on the date of December 31, 2015, 28 shares were increased for every 10 shares
to all the shareholders by converting capital reserve into share capital, so the total share
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Sino Great Wall Co., Ltd. 2016 Annual Report
capital were 1,698,245,011 shares after such share increasing by converting capital
reserve into share capital. of which Mr. Chen Lue holds 582,944,556 shares, taking for
34.33% of the company’s total share capital, remained as the company’s actual
controlling shareholder and the actual controller.
V. Other Relevant Information
CPAs engaged
Name of the CPAs BDO China Shu Lun Pan Certified Public Accountants LLP
Office address： 10/F of the No.7 Building, No16 Yard, Mid of West 4th Ring Road, Haidian DDistrict, Beijing
Names of the Certified Public
Liao Jiahe, Xu Shibao
Accountants as the signatories
The sponsor performing persist ant supervision duties engaged by the Company in the reporting period.
√Applicable □Not applicable
Sponsor name Office address Representatives Period of supervision and guide
6/F,A Unit, Fengming
Huatai United Securities Co., International Building, No.22, Jia Chunhao, Mao Dawei, Wu September 27, 2015 to
Ltd. Fengsheng Hutong, Xicheng Wenmin December 31,2018
District, Beijing
The Financial advisor performing persist ant supervision duties engaged by the Company in the reporting period
√ Applicable □Not applicable
Advisor Name Office address Representatives Period of supervision and guide
6/F,A Unit, Fengming
Huatai United Securities Co., International Building, No.22, Jia Chunhao, Mao Dawei, Wu September 27, 2015 to
Ltd. Fengsheng Hutong, Xicheng Wenmin December 31,2018
District, Beijing
VI.Summary of Accounting data and Financial index
May the Company make retroactive adjustment or restatement of the accounting data of the previous years due to
change of the accounting policy and correction of accounting errors.
□Yes √No
Changed over last year
2016 2015 2014
（％）
Operating Gross income（RMB） 4,664,999,117.17 4,010,358,999.58 16.32% 2,754,684,893.91
Net profit attributable to the
shareholders of the listed company 473,661,862.67 346,648,651.48 36.64% 186,857,504.45
（RMB）
Net profit after deducting of
470,274,602.37 347,196,614.68 35.45% 183,801,389.95
non-recurring gain/loss attributable
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Sino Great Wall Co., Ltd. 2016 Annual Report
to the shareholders of listed
company（RMB）
Cash flow generated by business
-1,687,875,813.94 -292,051,257.08 -30.00% 163,847,389.34
operation, net（RMB）
Basic earning per
0.28 0.4 -30.00% 0.74
share(RMB/Share)
Diluted gains per
0.28 0.40 -30.00% 0.74
share(RMB/Share)(RMB/Share)
Net asset earning ratio（%） 31.18% 34.52% -3.34% 24.54%
End of Changed over last year
End of 2016 End of 2014
2015 （％）
Gross assets（RMB） 7,986,178,961.63 4,017,462,824.63 98.79% 2,447,572,750.57
Net assets attributable to
shareholders of the listed company 1,777,948,117.49 1,282,256,738.74 38.66% 761,471,188.44
（RMB）
Ⅶ.The differences between domestic and international accounting standards
1．Simultaneously pursuant to both Chinese accounting standards and international accounting standards
disclosed in the financial reports of differences in net income and net assets.
□ Applicable √ Not applicable
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards.
□ Applicable √Not applicable
Ⅷ.Main Financial Index by Quarters
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 924,667,155.55 1,028,907,599.96 1,280,022,467.68 1,431,401,893.98
Net profit attributable to the
76,587,282.98 125,712,133.66 100,866,553.43 170,495,892.60
shareholders of the listed company
Net profit after deducting of
non-recurring gain/loss attributable
76,587,282.98 99,349,882.17 100,801,973.68 193,535,463.54
to the shareholders of listed
company
Net Cash flow generated by
-318,972,753.01 -937,643,206.19 -429,722,866.27 -1,536,988.47
business operation
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Sino Great Wall Co., Ltd. 2016 Annual Report
Whether significant variances exist between the above financial index or the index with its sum and the financial
index of the quarterly report as well as semi-annual report index disclosed by the Company.
□ Yes √No
Ⅸ.Items and amount of non-current gains and losses
√Applicable □Not applicable
In RMB
Items Amount (2016) Amount (2015) Amount (2014) Notes
Non-current asset disposal
gain/loss(including the write-off part for -564,833.40 -81,112.15 -137,889.40
which assets impairment provision is made)
Govemment subsidy recognized in
currentgain and loss(excluding those closely
108,121.33 342,246.00
related to the Company’s business and
granted under the state’s policies)
Capital occupation charges on
non-financialenterprises that are charged to 5,214,416.45
the profit/loss for the reporting period
Profit due to the situation where
investmentcosts for the company to obtain
subsidiaries, assoiates and joint ventures
1,783,284.99
are lower than the enjoyable fair Value of
indetifiable net assets of investees when
making investments
Profit/loss on fair value changes of
transactional financial assets and liabilities
& investment profit on disposal of
transactional financial assets and liabilities
443,065.98 60,407.78
as well as financial assets available for sale ,
except for effectively hedging business
related to normal business operations fo the
Company
Non-operating incomeand expense other
5,296,814.65 -905,796.34 -1,062,500.49
than the above
Less: Amount of influence of income tax 3,668,000.60 -96,699.29 1,018,319.84
11,192.65
Total 3,387,260.30 -547,963.20 3,056,114.50
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Compaines Offering their Securities to the Public-Non-recurring Gains and Losses and
its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure
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Sino Great Wall Co., Ltd. 2016 Annual Report
for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as
recurring gains and losses, it is necessary to explain the reason.
□ Applicable √ Not applicable
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Sino Great Wall Co., Ltd. 2016 Annual Report
III. Outline of Company Business
Ⅰ.Main Business the Company is Engaged in During the Report Period
Whether the company needs to comply with the disclosure requirements of the particular industry
No
Sino Great Wall’s main business has two aspects: the first is construction of engineering projects, and the
second is medical & health industry investment and management. The business of construction of engineering
projects mainly includes international and domestic large-scale project contracting, with the international business
mainly centering on the countries and regions along “One Belt, One Road”, and currently, the international
business covers many countries and regions such as the Middle East, Southeast Asia and Africa. The Business
scope covers building project, infrastructure project, commercial complex project etc. For the domestic business,
with the company’s continuous improvement of construction qualifications, the company’s construction income in
PPP projects, building construction, municipal Engineering, infrastructure and new energy field has gradually took
the dominant position, while the proportion of income of pure decoration business slightly decreased. The medical
& health industry investment and management mainly adopts a number of ways such as the acquisition of the
existing hospital, the construction of the new hospital and operating hospital PPP project to enter the operation
and management of medical & health industry, thus to achieve the development of both the construction business
and the medical & health business.
Currently, the company’s construction qualifications include: first-class qualification as general contractor
of housing & construction project, first-class qualification as specialized contractor of architectural decoration
engineering design and construction, first-class qualification as specialized contractor of building curtain wall
engineering, first-class qualification as specialized contractor of ground foundation engineering, first-class
qualification as specialized contractor of firefighting facilities engineering, first-class qualification as specialized
contractor of waterproof anti-corrosion insulation engineering, second-class qualification as general contractor of
mechanical and electrical engineering construction, second-class qualification as specialized contractor of bridge
construction, second-class qualification as general contractor of petrochemical engineering construction,
second-class qualification as general contractor of municipal public engineering construction, second-class
qualification as specialized contractor of tunnel construction, second-class qualification as specialized contractor
of fabrication and installation of hydraulic metal structure, second-class qualification as general contractor of
water conservancy and hydropower project construction, third-class qualification as general contractor of railway
engineering construction, second-class qualification as general contractor of metallurgical engineering
construction, qualification regardless of grades as specialized contractor of special engineering, third-class
qualification as specialized contractor of highway pavement engineering, third-class qualification as specialized
contractor of highway subgrade engineering etc. The scope covers the engineering qualifications of building,
highway, railway, municipal utilities, water conservancy and hydropower, petrochemical, electric power and other
types of engineering.
The medical and health business introduced pundits in the medical field and technical experts together with
senior talents to set up a competitive medical team. There are a number of project teams set up all over the country,
initially completed the medical& health industry layout. In 2016, it has purchased Wuhan Commercial and
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Sino Great Wall Co., Ltd. 2016 Annual Report
Vocational Hospital Co.,Ltd, won the bids of many PPP medical and health projects such as PPP project of
Relocation of Luyi People's Hospital of Henan Province and the PPP project of Overall Relocation of Huichang
County People's Hospital of Jiangxi, so the medical and health business has been developed smoothly.
Ⅱ.Major Changes in Main Assets
1. Major Changes in Main Assets
Main assets Major changes
Equity assets No change of present period compared with initial period
193.03% increased in the present period compared with initial period, mainly caused by
Fixed assets
the acquisition of Wuhan commercial worker hospital
1045.94% increased in the present period compared with initial period, mainly caused by
Intangible assets
the acquisition of Wuhan commercial worker hospital
100% decreased in the present period mainly owing to the completion of tower crane
construction in process installation in Kuwait project and completion construction of the factory in Suzhou city
carried over to the fixed asset.
7.76 increased in the present period mainly owing to the acquisition of Wuhan
Goodwill commercial worker hospital, Sichuan Dinghui Construction Co.,Ltd as well as Sichuan
Haoyao Construction Engineering Co., Ltd.
2. Main Conditions of Overseas Assets
√ Applicable □ Not applicable
Control Foreign
Whether exist
measure to assets
Content of Reason for Operation Income(RMB significant
Asset size Location ensure the accounted for
assets the formation mode ) impairment
secutity of net assets of
risk
assets the Company
Fixed assets Overseas 32,087,873.08 Kuwait, 1.76% No
purchasing of Cambodia,
tower crane Qatar,
& vehicles Algeria
Ⅲ.Analysis On core Competitiveness
Whether the company needs to comply with the disclosure requirements of the particular industry
No
Sino Great Wall Co.,Ltd is a leading construction & engineering contractor in China with business covers
various types construction & engineering contracting. The implementation of the National Strategy of “One Belt,
One Road” will provide a good opportunity for the company's overseas business development. The company
continues to increase efforts to open up overseas markets, thus the overseas project orders and the revenue have
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Sino Great Wall Co., Ltd. 2016 Annual Report
maintained a rapid annual growth rate. With the continuous improvement of relevant construction qualifications,
the company’s domestic business also will have a lot of good opportunities as the country has been continuously
promoted PPP projects. The company's comprehensive strength, overseas influence and market competitiveness
have increased year by year.
1. Strategic positioning advantage
The “Construction & Engineering contracting” and “Medical & Health Business” will be the company’s two
strategic directions for future development. In 2013, the company set up the development goal “Making bigger
and stronger overseas business, and to become the world's leading international comprehensive construction &
building service provider”. In 2015, the company set up the “Medical & Health business” as another essential
development direction. All of those are to comprehensively cater the needs of the national strategies of “One Belt,
One Road” and “Medical & Health Industry Development”. The good prospects of “One Belt, One Road” projects
and “Medical & Health Industry” will provide a broad market space for the company’s business development. In
terms of engineering contracting, the early-development advantage of overseas business enables the company to
have rich management experiences and high-quality customers and establish talented teams, thus laid a solid
foundation for the company’s overseas business development. In terms of the Medical & Health business, the
company has set up project teams in many domestic places such as Sichuan, Henan and Hubei, and the company
has purchased Wuhan Commercial and Vocational Hospital Co.,Ltd and won the bids of many medical and health
PPP projects. Also, the company has established cooperative relationships with many hospitals and has recruited
many kinds of talents in terms of medical, hospital management, investment and financing etc, thus provided a
strong support for the Medical & Health business development.
2. Standardized and high-efficient management system, fully market-oriented operation mechanism
With the increasingly expanding of the company scale and business scope, the management for the company
is becoming more complex. However, the company timely set up the sound management system and the
authorization system to standardize the approval procedures, reduce the management hierarchy tiers and improve
the work efficiency and execution, thus ensured the efficient operation of the company’s business operation. For
the operation mechanism, the company bravely faces the fierce competition in the market, adheres to the
market-oriented development, respects the objective laws of the market and constantly improves its management
level, thus to timely response to changes in the market and continuously improve the company's market image,
construction quality and profitability.
3. Integrated design and construction advantages
The company has a wide range, high-ranking construction qualifications, and the company has integrated
design and construction experiences and good project management capabilities, so the company is able to provide
integrated design and construction services in terms of civil engineering, decoration, mechanical and electrical
installation and full industry chain of curtain wall, and the company can independently complete the whole
process of construction project. The company can form a comprehensive advantage in the field of building
engineering, so it can reasonably schedule the procurement, labor use and construction plan, as well as the
company can constantly optimize the process to reduce the project costs. The company’s excellent design ability,
sound construction quality, high-efficient construction planning and the comprehensive high-quality service
greatly enhanced the customers’ satisfaction.
4. Costs advantages and quality-control advantages
The core management staff of the company all have more than 10 years experiences of building and
engineering construction. Upon the deep understanding of the industry, the company established a relatively
perfect material procurement, labor management and quality control system. Through the price ceiling mode for
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Sino Great Wall Co., Ltd. 2016 Annual Report
procurement, the company screens the suppliers in the early stage of a project, thus to ensure that the procurement
costs of the project materials would be in a reasonable scope. By locking the technical requirements and time
requirements of the project, the company can lock the labor costs. The company has set up strict quality-control
system for the design drawing, raw material procurement and each aspect of the project construction management,
thus to strictly ensue the project construction quality, so the company has won good reputation and got trust and
recognition by a great number of customers.
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Sino Great Wall Co., Ltd. 2016 Annual Report
IV. Management’s Discussion and Analysis
Ⅰ.General
1. Overall overview of business condition
The year of 2016 is the beginning year of China's "13th Five-Year" plan, and it also is the crucial year for the
supply-side structural reform. Although the world economic growth is still slow, the China’s economy has shown
signs of stabilized recovery after the bottoming under the impact of positive fiscal policy, adaptive monetary
policy and the real-estate policy. Under the background of the new economical normal, the company firmly
adheres to the development concept of “International development” and closely follows up the national
strategy of “One Belt, One Road”, seizing the opportunity and actively going abroad for development. The
company continuously increases the efforts of business development in the countries and regions along “One Belt,
One Road”. Meanwhile, the company actively seeks the cooperation with domestic and foreign well-known
companies, tapping into each other’s advantage to continuously expand the cooperative fields. In 2016, the
amount of the overseas bids won by the company and the new signing orders exceeded RMB 27 billion, so the
plenteous orders will provide a solid safeguard for the company’s operating performance in the next few years.
In 2016, China continued to strongly promote the PPP project. Based on the “Guidance on the Promotion of
cooperation model between government and social capital in the field of public service” released in 2015, the
government further released other official documents such as “Notice on promoting asset securitization related to
government and social capital cooperation (PPP) project in traditional infrastructure field”. Under China’s strong
promotion of PPP project construction, the domestic PPP project business continues to heat up and the investment
in infrastructure has been picking up. The company precisely judged the timing and timely seized the
opportunities, so the company carried out merger and acquisition of enterprises in the same industry and perfected
the construction qualifications. Therefore, the company’s domestic business has been effectively extended and
developed, and the company has made the successful transformation and upgrading from the previous main
business of decoration, thus becoming a comprehensive construction & building service provider with general
contracting ability of construction, which greatly improved the company’s s core competitiveness and the
comprehensive strength.
In 2016, for the investment in the medical field, the company completed the purchase of Wuhan Commercial
and Vocational Hospital Co.,Ltd (hereinafter referred to as the "Wuhan Commercial and Vocational Hospital").
The hospital PPP business achieved a good start, and then the company won the bids of Relocation of Henan Luyi
hospital, Guizhou Zhongshan Hongqiao City Hospital Project, the PPP project of Overall Relocation of Huichang
County People's Hospital and the PPP construction project of Lingbao First People's Hospital etc. The signing and
implementation of the above projects will provide a strong support for the company's future operating
performance.
Based on the analysis and judgment of the status quo and the future prospects of the domestic and
international construction market and the medical & health industry, the company will continue to enhance the
project contracting and investment along “One Belt, One Road”, increase the investment in the domestic medical
& health industry and PPP business, constantly improve the company’s management level, perfect and upgrade
the existing qualifications, strongly expand overseas markets, actively participate in the domestic infrastructure
PPP projects and promote the sound implementation of more projects, thus to keep a stable, harmonious
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Sino Great Wall Co., Ltd. 2016 Annual Report
development for the company’s domestic and international business and continuously improve the company’s
profitability.
In 2016, the company realized operation income of RMB 4.665 billion, an increase of 16.32% from the last
year; realized the operating profits of RMB 556million, an increase of 28.99% from the last year; and the net
profit attributable to the parent company was RMB 474 million, an increase of 36.64% from the last year.
In 2016, the main work carried out by the company is as follows:
1) Improved the construction qualifications for domestic building & engineering construction, extended the
industry chain.
In 2016, the main income of the domestic business was still from the traditional decoration business. In order
to better expand the domestic business and extend the industrial chain, the company bought out Sichuan Ding Hui
Construction Engineering Co., Ltd (the current name is Sino Great Wall Southwest Construction Engineering Co.,
Ltd), and the company obtained the share-control of Sichuan Hao Yao Construction Engineering Co., Ltd (Now is
Sino Great Wall Jianye Construction Engineering Co., Ltd) by the way of capital increase and becoming a
shareholder, so the company has improved the construction qualifications for domestic building & engineering
construction, and has expanded the qualification field from the previous decoration for constructions to a number
of new fields such as housing &building construction, municipal public facility, highway, water conservancy and
hydropower, petrochemical and power engineering. Therefore, the company has greatly expanded the company’s
business scope and enhanced the company’s market competitiveness and influence, thus laid a solid foundation
for the further improvement on the company’s business performance and profitability.
2) Achieved good results in the overseas business development
In 2016, benefiting from the strong promotion of “One Belt, One Road” policy, relying on the company’s good
reputation in the overseas construction and the company’s rich construction experience and upon the company’s
hard-working, the company’s overseas business achieved a rapid growth. In 2016, the company has won the bids
and/or large orders in a number of countries and regions such as Indonesia, Algeria, Burma, Congo, Laos,
Kampuchea, and the total amount of those orders exceeds RMB 27 billion. After several years of unremitting
efforts and careful cultivation, the company's overseas business development has entered into the fast lane, and the
above orders will provide a strong guarantee for the company's business performance in the next few years.
(3) Made a good start in the medical & health industry
In 2016, the company achieved a good start in the medical & health industry, and then the company won the
bids of a number of hospital PPP projects including Relocation project of Henan Luyi hospital, Guizhou
Zhongshan Hongqiao City Hospital Project, the PPP project of Overall Relocation of Huichang County People's
Hospital and the PPP construction project of Lingbao First People's Hospital. The company has trained and
cultivated the professional medical management and marketing team.
(4) Fully respecting talents and giving opportunities to talented people, and continuously drawing in talents
The enterprise competition is ultimately the talents competition, so the company always adheres to the value of
“people-oriented, giving full respect and opportunities to talents”. The company highly values the human
resources and talents cultivation. According to the company’s business development plan, the company
continuously draws in exterior talents and cultivates the inner talents. The company has continuously improved
the quality and level of the technical team and management team of the company, as well as provided a good
development platform for various types of talents. By perfecting the personnel training mechanism and the
performance evaluation and incentive evaluation mechanism etc, the company would attract more talents and
retain the talents, thus to provide a good talent reserve for the company‘s healthy, sustainable development.
（5）Standardize company instruction and enhance management
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Sino Great Wall Co., Ltd. 2016 Annual Report
In 2016, based on reality, the company revises and improves a series of instructions including Articles of
Association and Rule of Procedure of Shareholders' Meeting to further improve the corporate governance and to
build a management system and internal control system in a more scientific and rigorous way and to manage and
standardize the company, its subsidiaries and detailed businesses in more layers for improving Enterprise
operation management level. Provide a solid system guarantee for the development of all business and effectively
improve the management of the company and reduce the risk of company’s operation.
The company, a fast developing construction one, issues shares to Sino Great Wall (Beijing) Investment Co.,
Ltd. and Beijing Anben Medicare investment Co., Ltd. and Mr. Zheng Jihua and gets fund of 2.5 billion Yuan for
the company’s high demand of circulating funds and assets in the development and operation and for reducing the
company’s debt asset ratio, optimize capital structure and for enhancing the company’s capital strength. On
February 16, 2017, the company held Board of Directors and reviewed Resolution on Adjusting Private Equity
Placement Scheme of The Company and adjusted the total capital to be 900 million Yuan. Currently private
equity placement A share of the company gets the approval of Issuance Examination of China Securities
Regulatory Commission. The fund of private equity placement is used for supplying circulating fund and repaying
bank loan, which lays a solid foundation of company’s business and improves the comprehensive competence of
the company further.
Ⅱ.Main business analysis
1. General
Refer to relevant contents of “1.Summarization” in “Discussion and Analysis of Management”.
2. Revenue and cost
(1)Component of Business Income
In RMB
2016 2015
Increase /decrease
Amount Proportion Amount Proportion
Total business
4,664,999,117.17 100% 4,010,358,999.58 100% 16.32%
income
Industry
EPC 3,118,359,658.51 66.85% 1,513,458,850.56 37.74% 106.04%
engineering design 12,669,951.31 0.27% 19,919,636.46 0.50% -36.39%
Decoration work 1,452,138,348.28 31.13% 2,455,199,964.42 61.22% -40.85%
Medical service
81,593,110.43 1.75%
revenue
Other 238,048.64 0.01% 21,780,548.14 0.54% -98.91%
Product
17
Sino Great Wall Co., Ltd. 2016 Annual Report
4,664,999,117.17 100.00% 4,010,358,999.58 100.00% 16.32%
Area
Domestic 1,478,928,295.44 31.70% 2,436,352,972.25 60.75% -39.30%
Overseas 3,186,070,821.73 68.30% 1,574,006,027.33 39.25% 102.42%
(2)Situation of Industry, Product and District Occupying the Company’s Business Income and Operating
Profit with Profit over 10%
√ Applicable □Not applicable
Whether the company needs to comply with the disclosure requirements of the particular industry
No
In RMB
Increase/decrease Increase/decrease Increase/decrease
of revenue in the of business cost of gross profit
Gross profit
Turnover Operation cost same period of over the same rate over the same
rate(%)
the previous period of period of the
year(%) previous year (%) previous year (%)
Industry
EPC 3,118,359,658.51 2,180,789,521.13 30.07% 106.04% 82.54% 9.01%
Decoration works 1,452,138,348.28 1,215,243,366.01 16.31% -40.85% -37.99% -3.77%
Product
Area
Domestic 3,186,070,821.73 2,234,413,513.88 29.87% 102.42% 87.03% 5.77%
Overseas 1,478,928,295.44 1,224,964,230.78 17.17% -39.30% -37.83% -1.96%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main
business based on latest on year’s scope of period-end.
□ Applicable √Not applicable
(3)Whether the Company’s Physical Sales Income Exceeded Service Income
□ Yes √No
(4)Degree of Performance of the Significant Sales Contract Signed up to this Report Period
√ Applicable □Not applicable
18
Sino Great Wall Co., Ltd. 2016 Annual Report
Amount of Progress of project Date of
No Contracting party Name of Projet
contract contract
PT.Cipta karya bersama Yet to be put into
1 Indonesia Emerald Apartment RMB 314 million 2016/3/8
lestari operation
Pile foundation
USD80 million
completed, operation of
2 Mottamma Holdings Ltd. Myanmar M-Tower project （about RMB 2016/05/31
Basement Waterproof
550 million
Started
USD 120 million Yet To Be Put Into
Oxley Consultancy &
3 Myanmar MIN Residence project （about RMB830 Operation 2016/6/1
Management Co., Ltd.
million）
Comprehensive Development Pile Foundation
USD 285 million
Oxley Gem (Cambodia) Project (Project PP50), Floor 55, Completed
4 （about 2016/6/1
Co., Ltd Village 14, Hun Sen Road,
RMB1.97 billion）
Cambodia
General Contracting for 5000 USD 300 million Yet To Be Put Into
Banque Congolaise de
5 modern comfortable housings in The （about RMB 2 Operation 2016/6/29
l'Habitat (BCH)
Republic of Congo billion）
General Contracting for Project PC, Operation Started
Pt. Wangxiang Nickel Production Line t, Iron-nickel Plant RMB 1.5015
6 2016/8/1
Indonesia PKEF, Morowali County, West billion
Sulawesi Island, Indonesia
Myr 167.7892 Process for Fundamental
VERITAS ARCHITECTS Angsana Apartment Project,Penang million（about Rebars of Temporary
7 2016/8/8
SDN BHD Island,Malaysia RMB 260 Tower Crane Completed
million）
Xinjianye Group Co., Ltd. USD 2.7billion Yet To Be Put Into
Cambodia Penh Shuangzhi Building
8 Taiwenlong Group Co., （about RMB Operation 2016/12/29
World Trade Center
Ltd. 1.8781 million）
About RMB 35.5
Subtotal
billion
(5)Component of business cost
Industry Category
In RMB
2016 2015 Increase
Industry Items
Amount Proportion Amount Proportion /decrease
19
Sino Great Wall Co., Ltd. 2016 Annual Report
EPC Labor wages 627,669,828.27 18.14% 227,743,800.08 7.20% 175.60%
EPC Material 1,326,646,537.37 38.35% 695,054,284.77 21.96% 90.87%
EPC Other 226,473,155.49 10.77% 271,915,654.94 8.59% 37.07%
Medical service
57,672,498.15 1.67%
revenue
Engineering
6,239,359.37 0.18% 10,603,822.07 0.34% -41.16%
design
Decoration works Labor wages 276,123,560.64 7.98% 547,781,369.10 17.31% -49.59%
Decoration works Material 770,503,604.30 22.27% 1,359,863,294.41 42.95% -43.34%
Decoration works Other 168,616,201.07 0.63% 52,064,960.29 1.65% -58.10%
Notes
(6)Whether Changes Occurred in Consolidation Scope in the Report Period
√ Yes □No
1. Companies into merger range newly in this stage
In 2016, the company founded Sino Great Wall Medicare investment Co., Ltd., Sino Great Wall
Infrastructure Investment Co., Ltd. and Wuhan Vocational Hospital Co., Ltd. wholly owned by the company by
cash offer, Sino Great wall Xinan Construction Co., Ltd. (Original name: Sichuan Dinghui Construction Co., Ltd.)
which is wholly bought by subsidiary Sino International, Sino Great Wall Construction Co., Ltd. (Original name:
Sichuan Haoyao Construction Co., Ltd.) is 60% bought by share issue by the company. Meanwhile, Sino
International founded newly subsidiaries called Sino Great wall Property (Hubei) Co., Ltd. and Sino Great wall
Development (Hengqin) Co., Ltd. Then the above newly founded companies and newly bought companies began
to be into the merger range of the company since 2016.
2. Companies not into merger account range in this stage
In 2016, Sino International cancelled holding companies called Sino Heji Recycled Material Co., Ltd., which
was not in the merger range.
(7)Relevant Situation of Significant Changes or Adjustment of the Business, Product or Service in the
Company’s Report Period
□ Applicable √ Not applicable
(8)Situation of Main Customers and Main Supplier
Information of the Company’s top 5 customers
Total sales amount to top 5 sales customers (RMB) 2,806,001,475.3
Proportion of sales to top 5 customers in the annual 60.15%
20
Sino Great Wall Co., Ltd. 2016 Annual Report
sales(%)
Information of the Company’s top 5 customers
No Name Amount（RMB） Proportion %
1 Customer1 902,018,306.43 19.34%
2 Customer2 768,677,450.02 16.48%
3 Customer3 577,372,398.63 12.38%
4 Customer4 395,300,992.03 8.47%
5 Customer5 162,632,328.22 3.49%
Total -- 2,806,001,475.33 60.16%
Principal suppliers
Information of the Company’s top 5 suppliers
Total Purchase amount to top 5 sales suppliers (RMB) 210,324,623.20
Proportion of purchase to top 5 suppliers in the annual
14.11%
purchase(%)
Information about the top 5 suppliers
No Name Amount（RMB） Proportion%^
1 Customer1 80,345,978.27 3.83%
2 Customer2 70,016,472.60 3.34%
3 Customer3 69,059,944.85 3.29%
4 Customer4 65,091,067.63 3.10%
5 Customer5 45,011,071.35 2.15%
Total -- 329,524,534.70 15.71%
Notes
□ Applicable √ Not applicable
3.Expenses
In RMB
Increase/Decrea
2015 2015 Notes
se(%)
Sale expenses Due to the reduction of marketing
30,318,688.27 13,686,172.10 121.53%
personnel
Administration expenses Due to the increase of overseas
branches and the increase of domestic
313,930,733.56 154,562,327.86 103.11%
and overseas departments such as
group, optoelectronic and medical.
Financial expenses 127,437,227.95 54,866,402.02 132.27% For the increase in the Company’s
21
Sino Great Wall Co., Ltd. 2016 Annual Report
short-term loan and long-term loan as
well as the increase in overseas L/G
amortization
4.R& D Expenses
√ Applicable □Not applicable
In order to enhance the core competence of the company and to meet the demand of constant development, the
company focuses on researching decoration design and general contracting and so on. Currently each project shall
be operate as plan. Through practical application, it can get good economic and social benefit.
Situation of Research and Development Input by the Company
2016 2015 Increase /decrease
Number of Research and
191 189 1.06%
Development persons (persons)
Proportion of Research and
7.83% 11.24% -3.41%
Development persons
Amount of Research and
Development Investment (In 139,163,839.18 133,143,918.79 4.52%
RMB)
Proportion of Research and
Development Investment of 2.98% 3.32% -0.34%
Operation Revenue
Amount of Research and
Development Investment 0.00 0.00
Capitalization (In RMB)
Proportion of Capitalization
Research and Development
0.00% 0.00%
Investment of Research and
Development Investment
The Reason of the Prominent Change in Total Amount of Research and Development Input Occupying the
Business Income Year on Year
□ Applicable √Not applicable
Explanation of the Reason for Substantial Changes in the Research and Development Input’s Capitalization Rate
and Its Reasonableness
□ Applicable √ Not applicable
5.Cash Flow
In RMB
Items 2016 2015 Increase/Decrease(%)
22
Sino Great Wall Co., Ltd. 2016 Annual Report
Subtotal of cash inflow received
4,618,123,624.04 4,257,440,458.70 8.47%
from operation activities
Subtotal of cash outflow
received from operation 6,305,999,437.98 4,549,491,715.78 38.61%
activities
Net cash flow arising from
-1,687,875,813.94 -292,051,257.08 -477.94%%
operating activities
Subtotal of cash inflow received
121,565,115.12 2,494.86 4,872,522.72%
from investing activities
Subtotal of cash outflow for
246,357,420.64 28,713,135.66 758.00%
investment activities
Net cash flow arising from
-124,792,305.52 -28,710,640.80
investment activities
Subtotal cash inflow received
3,527,919,898.49 1,805,738,341.24 95.37%
from financing activities
Subtotal cash outflow for
1,348,742,579.57 1,146,676,943.40 17.62%
financing activities
Net cash flow arising from
2,179,177,318.92 659,061,397.84 230.65%
financing activities
Net increase in cash and cash
360,959,565.60 338,985,801.91 6.48%
equivalents
Notes to the year-on-year change of the relevant data
√Applicable □ Not applicable
1. Net cash flows from operating activities decreased significantly over the previous year, which was mainly due
to the short period of credit accounts of overseas project suppliers.
2. The net cash flow from financing activities increased compared to the last year mainly due to the increase of
bank loans in the current period.
Notes to the big difference between cash flow from operating activities and net profit in the reporting year
√Applicable □ Not applicable
The large difference between the company’s net cash flows from operating activities and the net profits of the year
in the reporting period was mainly due to the increase of operating receivables.
Ⅲ.Analysis of Non-core Business
□ Applicable √ Not applicable
Ⅳ.Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
23
Sino Great Wall Co., Ltd. 2016 Annual Report
In RMB
End of 2016 End of 2015
Proportion
Proportion
increase/decre Notes to the significant change
Amount in the total
ase
assets(%)
Monetary funds 1,340,815,821.83 16.79% 695,384,561.31 17.31% -0.52%
Account
3,725,170,208.31 46.65% 2,352,808,087.33 58.56% -11.91%
receivable
Inventory 332,904,930.36 4.17% 168,133,668.91 4.19% -0.02%
Fixed assets 128,483,747.74 1.61% 43,846,215.63 1.09% 0.52%
Construction in
10,016,928.24 0.25% -0.25%
process
Short-term loans 1,966,058,357.59 24.62% 225,408,496.07 5.61% 19.01%
Long-term loans 786,858,878.82 9.85% 30,140,649.14 0.75% 9.10%
2.Asset and Liabilities Measured by Fair Value
□ Applicable √ Not applicable
3. Restricted asset rights as of the end of this Reporting Period
Ⅴ.Investment situation
1. General
√ Applicable □Not applicable
Investment Amount in 2016(RMB) Investment Amount in 2015(RMB) Change rate
2.Condition of Acquiring Significant Share Right Investment during the Report Period
√ Applicable □ Not applicable
In RMB
Name Gain or
Progres Whethe
of the Investm Investm expecti Less or Date of
Main Investm Share s to the r to Disclos
Compa ent Capital ent Product ng the Disclos
Busines ent Proport Partner balance Involve ure
ny Amoun Source Horizo Type earning Current ure(Not
s Way ion % sheet in Index
Investe t n s Investm e 5)
date Lawsuit
d ent
Wuhan Acquisi http//.w
medical Purchas 970000 Self Long-te May
Comme 100% tion No ww.cni
service e 00 fund rm 11,2016
rcial & complet nfo.co
24
Sino Great Wall Co., Ltd. 2016 Annual Report
Vocatio ed m.cn
nal
Hospita
l Co.,Lt
d
Great
Wall Capital
Industr increas Novem http//.w
Increas
y Constru 900000 Self Long-te e has ber ww.cni
e 60% No
Engine ction 00 funds rm been 10,201 nfo.co
capital
ering complet 6 m.cn
Co., ed
Ltd.
3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
□ Applicable √ Not applicable
4.Investment of Financial Asset
（1）Securities investment
□ Applicable √ Not applicable
The Company had no securities investment in the reporting period.
（2）Investment in Derivatives
□ Applicable √ Not applicable
The Company had no investment in derivatives in the reporting period.
5.Application of the raised capital
√ Applicable □ Not applicable
（1）General application of the raised funds
√ Applicable □ Not applicable
In RMB’0000
Amount of Accumulat Proportion Total Amount of
Total Total Use and
Total raised ive amount of raised Amount of the Raised
Year of Way of Amount of amount of Whereabo
raised capital of of raised capital of the Fund with
Raising Raising the Raised Raised uts of the
capital which the capital of which the Unused over 2
Fund Used Funds Unused
purpose which the purpose Raised Years’
25
Sino Great Wall Co., Ltd. 2016 Annual Report
at the was purpose has been Fund at Raised Idling
changed in has been changed the Fund
the report changed (%) Current
period Period
In the
special
Stocks
2015 25,500 3,366.36 4,966.36 0 0 0.00% 20,533.64 account to 0
issue
raise funds
in storage
Total -- 25,500 3,366.36 4,966.36 0 0 0.00% 20,533.64 -- 0
Notes to use of raised capital
Upon the approval from the CSRC with the document of the 2015-No.1774 Zheng Jian Xu Ke -Reply of the Major Asset
Restructuring and the Issue of Shares to Objects such as Chen Lue to Purchase Assets and Raise Matching Funds by Shenzhen
Victor Onward Textile Industrial Co., Ltd, Sino Great Wall International Engineering Co.,Ltd( hereinafter referred to as: “company
or the company”) had non-publicly issued 25,914,633 shares of RMB common share(A share), of which the par value per share was
RMB 1.00, the issuing price per share was RMB 9.84, the total funds raised was RMB 254,999,988.72, and after deducting the
issuance expenses of RMB 14,500,000.00 directly from the raised funds, the actual net amount of the raised funds is RMB
240,499,988.72.
（2）Promised projects of raised capital
√ Applicable □ Not applicable
In RMB’0000
Date
Accumul Investme
when the
Total ated nt Has any
Project Total Amount project Benefit
raised amount progress Has the material
changed(i investme inested in has realized
Committed investment capital invested ended the predicted change
ncluding nt after the reached in the
projects and investment invested at the end reporting result be taken
partial adjustme reporting the reporting
as of the period(% realized place in
change) nt (1) period predicted period
commited reporting )(3)=(2)( feasibility
applicabl
period(2) 1)
e status
Committed investment projects
1. Overseas marketing
network construction No 10,000 10,000 3,226.51 3,226.51 No No
project
2.Informatization
No 2,500 2,500 27.6 27.6 No No
Construction Phase II
3.Related taxes and
agency fees of this No 13,000 13,000 112.25 1,712.25 No No
transaction
26
Sino Great Wall Co., Ltd. 2016 Annual Report
Subtotal of committeed
25,500 25,500 1,600 4,966.36
investment projects
Investment orientation for und arising out of plan
Total -- 25,500 25,500 3,366.36 4,966.36 -- -- 0 -- --
Situation about not
coming up to schemed
progress or expected Not applicable
revenue and the reason
( in specific project0
Notes to significant
change in feasibility of Not applicable
the project
Amount, application Not applicable
and application
progress of the
unbooked proceeds
About the change of Not applicable
the implementation site
of the projects invested
with the proceeds
Adjustment of the Not applicable
implementation way of
investment funded by
raised capital
About the initial Not applicable
investment in the
projects planned to be
invested with the
proceeds and the
replacement
Using the idle proceeds Not applicable
to supplement the
working capital on
temporary basis
Balance of the Not applicable
proceeds in process of
project implementation
and the cause
About application and
status of the proceeds The company will use the raised money 150 million Yuan to supply circulating money and the
unused remaining 55.6849 million Yuan will be saved in raised money account.
27
Sino Great Wall Co., Ltd. 2016 Annual Report
Problems existing in
application of the
proceeds and the No
information disclosure
or other issues
（3）Changes of raised funds projects
□ Applicable √ Not applicable
The Company had no raised funds in company reporting period.
VI. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no sales of major assets in the reporting period.
2.Sales of major equity
□ Applicable √ Not applicable
Ⅶ.Analysis of the Main Share Holding Companies and Share Participating Companies
√ Applicable □ Not applicable
Situation of Main Subsidiaries and the Joint-stock Company with over 10% net profit influencing to the Company
In RMB
Company Sectors Registered Operating
Company type Total assets Net assets Turnover Net Profit
Name engaged in capital profit
General
contracting,
subcontractin
g,
Sino Great engineering
Wall survey and
design; 7,493,324,70 1,707,478,63 4,583,167,95 597,298,486. 487,695,725.
International Subsidiaries 470,136,099
professional 3.87 3.38 8.10 46 96
Engineering
Co., Ltd. contracting;
architectural
decoration
engineering;
architectural
curtain wall;
28
Sino Great Wall Co., Ltd. 2016 Annual Report
project and
technology
study and
experimental
development;
sell building
material,
machinery,
hardware,
plastic
articles;
technology
development,
technology
consultation,
technology
service;
goods import
and export;
technology
import and
export; agent
import and
export.(After
delivering
this license,
you shall get
administrativ
e license
from civil
plan
committee
and civil
residential
committee. It
shall be filed
in civil
ministry of
commerce.)
Acquirement and disposal of subsidiaries in the Reporting period
√Applicable □Not applicable
The method of obtaining and handling The influence to the whole production and
Company name
subsidiaries during the report period performance
29
Sino Great Wall Co., Ltd. 2016 Annual Report
Wuhan Commercial & Vocational
Acquisition
Hospital Co.,Ltd
Luyi Shuguang medical industry
Investment
investment and Construction Co., Ltd
Notes
Sino Great wall International Construction Co., Ltd. is a subsidiary of the company and is the main of income and
profits of the company, which accounts for more than 90% of all the company’s operating income and net profit
and the rest subsidiaries account for less than 10% of all the company’s operating income and net profit, which
weight less in the whole company’s operation.
Ⅷ.Special purpose vehicle controlled by the Company
□ Applicable √ Not applicable
Ⅸ.Prospect for future development of the Company
1.Strategy of the Company’s Development
1. Building construction:
Economic development of our country has a new trend with structure adjustment, steady enhancement and
upgrading of industrial transformation. It is estimated that our economic trend will adjust from high-speed
adjustment to middle-high increase with the reduction of fixed asset investment increase rate of the whole society
in the future. For a middle or long time, development of national construction industry will change form
high-speed increase to moderate increase. Although national construction industry develops steadily, the potential
of whole industry remains great. Our country pushes greatly the public service on APP and infrastructure project,
which will promote the great development of related lines. Our company is engaged in construction, body of PPP
project, which can share the continuity and steady profits from construction, investment and operation of PPP
project. In recent years, property investment develops steadily, but it still increases in every year. With the rapid
increase of urbanization, the demands of resident’s house improving and living condition needs a long time,
construction market still has a bright future.
The implementation of “the Belt and Road” policy will boost the development of construction in nations and
areas along the sea and create an opportunity for national construction enterprises. As a renown international
construction contractor, based on the reputation and market image cumulated for many years, the company will
exert first-move advantages on overseas business, talent advantages, management advantages and customer
advantages to ensure the rapid growth of overseas business and fully enjoy the great benefits of “the Belt and
Road” policy.
2. Healthcare:
“13th Five-Year Plan” plans out “Health China”. Medicare industry is of great concern. In 2013, State
Council issued Suggestion on Stimulating the Development of Health Service Industry. In 2015, Ministry of
Public Health and other four ministries successively issued Guidance on Pilot Projects of the Public Hospital
Reform and Suggestion on Building Medical Organization by Encouraging and Guiding Social Capital and
other standard files. With the issuance of a series of strategies and standard files, construction and industry
30
Sino Great Wall Co., Ltd. 2016 Annual Report
development on medical and health industry step a new historical stage. The health demand of vast amount of
population and constant growth of the mass provide a great market space for the development of all medical
and health industry.
(II) The Company’s Development Strategy
The company focuses its development strategy on two aspects: one is to strengthen the project contracting and
investment of the Belt and Road Initiative, and the other is to enhance the domestic medical investment. At
present, the company has possessed abundant projects in Southeast Asia, South Asia, the Middle East and Africa,
and aside from intensifying the exploitation of and investment to the countries in the above-mentioned regions,
the company will take the efforts to explore North America, South America, Australia, Europe and other high-end
markets as core for the next step. In the field of medical investment, more funds will be disposed, apart from the
investment of hospital construction in PPP mode, in the acquisition of mature hospitals, the distribution of medical
e-commerce, the introduction of advanced medical technology and services from abroad. Centering around the
development strategies of “enlarging and strengthening overseas business to become an integrated international
construction services supplier” and “developing the health-care industry”, in the future, the company will devote
major efforts to developing abroad business and arranging the medical industry so as to enhance its capacity for
core competitiveness and profit constantly and eventually strive to build itself into a prominent business group
developed by the mutual driving forces of construction and health-care industry.
(III) The Company's Business Plans
In 2017, focusing on the development strategies laid down by the Board of Directors, the company will give
priority to launch the following activities:
(1) To promote the development of domestic business and actively participate in the construction of PPP projects
The year of 2017 will witness the company intensifying the expansion of domestic business. Thus, on the
basis of improving its construction qualification and capacity, the company will take positive part in the
construction of PPP projects, expand its business scope in health-care, infrastructure and other fields and its
development scale of architectural ../../../Program Files (x86)/Youdao/Dict/7.0.1.0227/resultui/dict/%3fkeyword=ornament
business, increase its domestic business income and profits, and enhance its comprehensive strength and core
competitiveness as well.
(2) To enlarge the influence of overseas market and the share of overseas business
In 2017, the company will make continuing efforts to explore overseas market thoroughly and strengthen the
exchanges and cooperation with governments of the foregoing countries and regions. With a full grasp of the
construction project opportunities from the countries and regions along the line of the Belt and Road, it will
continuously extend the scale of its overseas business and enhance the foreign influence of the brand Sino Great
Wall.
(3) To maintain the implementation of development projects for medical business and cultivate new profit
growth point
For the year of 2017, taking full advantage of the good opportunities provided by the national health-care
reform, the company will play a positive role in expanding the business in the area of medical health service,
acting to implement the construction of hospital PPP projects that have won the bid, and continuing to exploit new
hospital PPP projects as well as planning and developing in-depth cooperation in relation with medical business.
31
Sino Great Wall Co., Ltd. 2016 Annual Report
(4) To promote private issuing of share and enhance the capital strength of the company
On July 7, 2016, the 10th meeting of the 7th Board of Directors was convened to deliberate and approve the
Proposal on the Plan of non-public Issuing of A-Share by Sino Great Wall Co., Ltd and plan to issue shares to
Sino Great Wall (Beijing) Investment Co., Ltd, Beijing Anben Medical Investment Holdings Ltd and Mr. Zheng
Jihua, raising funds of RMB 2.5 billion. On October 14, 2016, the 16th meeting of the 7th Board of Directors was
convened to examined and adopted the Proposal on Adjustment to the Current Plan ofnon-public Issuing of
A-Share by Sino Great Wall Co., Ltd, adjusting the total raised fund to RMB 900 million. On March 22, 2017, the
application for non-publi issuing of A-share has been examined and approved by the Issuance Examination
Commission of CSRC, but at present the official documents approved by CSRC has not yet been received.
In 2017, the Company will fully seize the favorable opportunities brought by One Belt One Road strategy and
Public-Private-Partnership project construction which the nation vigorously implements. To make a further
perfection for overseas and domestic marketing networks, the Company will strive to exploit and develop new
high-quality customers. To make a further perfection for the Company’s relevant construction qualification, the
Company will enlarge the scope of its building construction for offering comprehensive solutions with more
perfection and higher quality to customers. The Company will reinforce and enlarge the brand awareness which
has been formed and the market share to constantly improve its core competitiveness and profitability.
3.Main Risks faced by the Company and Solutions
(1)Influence of Macro Economy and Policy
The construction industry and the health-care industry, in which the Company are engaging, are influenced
greatly by macro economy and policies. The uncertainty in international and domestic economic situation and the
changes of national policy will bring potential risks to the Company’s market development and operating
management.
Solutions: Pay constant attention to the international and domestic economic situation to make reasonable
prejudgement. Make timely adjustment for operating strategy and marketing policy and make pre-arranged
planning which copes with market changes to guarantee the smooth realization for business goals in 2016.
(2)Risks Aggravated by the Market Competition
With more competitions which domestic enterprises and international construction market take part in, the
Company’s overseas business operating will be impacted more or less.
Solutions: Strengthen team construction and take first-mover advantage of the Company’s overseas business.
Draw lessons from the past, improve the capacity of management and control for the Company’s own projects to
constantly heighten the Company’s core competitiveness.
(3)Management Risks Brought by Constant Business Scope Enlargement
In views of the period where the Company is in speedy development, the Company has transferred from the
sub-contractor of professional decoration to the general contractor of building construction, and the speedy
development in overseas business puts forward higher demands to the Company’s organization operating and
project management.
Solutions: Strengthen learning and training, constantly improve the quality of the on-the-job managers and
technicists, introduce high-level personnel and improve the overall management capacity and the technical
capacity of the Company to fully adapt to the pace of the Company’s speedy development
Ⅹ.Particulars about researches, visits and interviews received in this reporting period
32
Sino Great Wall Co., Ltd. 2016 Annual Report
1.Particulars about researches, visits and interviews received in this reporting period
√ Applicable □ Not applicable
Reception time Way of reception Types of visitors Basic index
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
January 20,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on January 20, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
February 1,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on February 1, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
March 3,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on Marh 3, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
March 11,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on March 11, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
May 4,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on May 4, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
May 24,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on Maty 24, 2016.
The interactive relation with the
September 2,2016 Onsite investigation Organization
investors on Shenzhen Stock Exchange
33
Sino Great Wall Co., Ltd. 2016 Annual Report
platform about Sino Great Wall
International Engineering Co., Ltd:
Record of the investors relations
activities on September 2, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
November 17,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on November 17, 2016.
The interactive relation with the
investors on Shenzhen Stock Exchange
platform about Sino Great Wall
December 23,2016 Onsite investigation Organization
International Engineering Co., Ltd:
Record of the investors relations
activities on December 23, 2016.
Reception times 9
Reception agency amount 40
Reception personal number 0
Others 0
Whether to disclose, reveal or disclose non-public
No
material information
34
Sino Great Wall Co., Ltd. 2016 Annual Report
V. Important Events
ⅠSpecification of profit distribution of common shares and capitalizing of common reserves
Formulation, implementation and adjustment of profit distribution policy of common shares especially cash
dividend policy during the reporting period
√ Applicable □Not applicable
On August 25, 2016, the 12th meeting of the 7th Board of Directors was convened to deliberate and approve the
Proposal on the Amendment of the Articles of Association, of which, the amendments include Article 162, Profit
Distribution Policy of the Articles of Association.
On December 16, 2016, the third Ppovisional Shareholders Meeting in 2016 was convened to deliberate and
approve the Proposal on the Amendment of the Articles of Association.
The details are as follows:
Article 162 Profit Distribution Policy Article 162 Profit Distribution Policy
The company's profit distribution shall attach The company's profit distribution shall attach importance
importance to the reasonable investment return for to the reasonable investment return for investors, especially
investors, especially the small and medium-sized the small and medium-sized investors, and take into account
investors, and take into account its sustainable its sustainable development, establish a sustained, stable and
development, establish a sustained, stable and positive dividend policy, and adopt the methods of profit
positive dividend policy, and adopt the methods of disribution in cash, stock, the combination of cash and stock
profit disribution in cash, stock, the combination of or other ways permitted by laws or regulations.
cash and stock or other ways permitted by laws or
(1) The Principle of Profit Distribution
regulations.
The company shall implement a sustained and stable
(1) The Principle of Profit Distribution
profit distribution policy, pay attention to the reasonable
The company shall implement a sustained and investment return for investors and give consideration to its
stable profit distribution policy, pay attention to the long-term and sustainable development; the company's profit
reasonable investment return for investors and give distribution must not exceed the cumulative distributive
consideration to its long-term and sustainable profit.
development; the company's profit distribution must
(2) The Forms of Profit Distribution
not exceed the cumulative distributive profit.
The company can adopt the methods of profit distribution
(2) The Forms of Profit Distribution
in cash, stock or the combination of cash, or other ways
The company can adopt the methods of profit permitted by laws or regulations and shall give priority to the
distribution in cash, stock or the combination of cash, method of cash dividends.
or other ways permitted by laws or regulations and
(3) The Specific Conditions and Proportion of Cash
shall give priority to the method of cash dividends.
Dividends
35
Sino Great Wall Co., Ltd. 2016 Annual Report
(3) The Specific Conditions and Proportion of Cash 1, The implementation of cash dividends must satisfy
Dividends simultaneously the following conditions:
1, The implementation of cash dividends must satisfy (1) The earnings per share of the year shall not be less than
simultaneously the following conditions: 0.1 yuan;
(1) The earnings per share of the year shall not be less (2) The cumulative distributive profits per share of the year
than 0.1 yuan; shall not be less than 0.2 yuan;
(2) The cumulative distributive profits per share of the (3) Unqualified audit reports of the company's annual or
year shall not be less than 0.2 yuan; semi-annual financial statements shall be issued by the audit
institution;
(3) Unqualified audit reports of the company's annual or
semi-annual financial statements shall be issued by the (4) No events such as major investment plans or major
audit institution; cash expenditures occured (excluding the fund-raising
projects).
(4) No events such as major investment plans or
major cash expenditures occured (excluding the Any event meeting any of the following criteria constitute
fund-raising projects). a major investment plan or major cash expenditure:
Major investment plan or major cash expenditure 1) The accumulated expenditures of the company’s planed
refers to the accumulated expenditures of the foreign investment, assets acquisition, equipment purchase,
company’s planed foreign investment, assets loan return and bond redemption that has already been
acquisition or equipment purchase, house buildings implemented in the year or will be implemented in the next
and land-use rights in the next 12 months reach or 12 months reach or exceed 50% of the latest total audited
exceed 30% of the latest total audited assets of the assets of the company and the expenditures above-mentioned
company and the expenditures above-mentioned must must exceed RMB 50 million;
exceed RMB 50 million.
2) The accumulated expenditures of the company’s
2, the Provisions on Proportion of Cash Dividends planed foreign investment, assets acquisition, equipment
purchase, loan return and bond redemption that has already
(1) The company shall maintain the continuity and
been implemented in the year or will be implemented in the
stability of the profit distribution policy. Under the
next 12 months reach or exceed 30% of the latest total
conditions that satisfying cash dividends, the yearly
audited assets of the company and the expenditures
profits distributed with cash shall be no less than
above-mentioned must exceed RMB 50 million.
10% of the distributive profits achieved in the year,
and within any three consecutive years, the profits 2, the Provisions on Proportion of Cash Dividends
distributed with cash shall be no less than 30% of the
(1) The company shall maintain the continuity and
average distributive profits achieved in the three
stability of the profit distribution policy. Under the
consecutive years;
conditions that satisfying cash dividends, the yearly profits
(2) The distributive profits un-allocated of the year can distributed with cash shall be no less than 10% of the
be allocated in subsequent years; distributive profits achieved in the year, and within any three
consecutive years, the profits distributed with cash shall be
(3) The profit distribution shall not exceed the scope
no less than 30% of the average distributive profits achieved
of the cumulative distributive profits, and shall not
in the three consecutive years;
impair the company's continuous operation ability.
(2) The distributive profits un-allocated of the year can be
(4) Time Interval of the Dividend Distribution
allocated in subsequent years;
36
Sino Great Wall Co., Ltd. 2016 Annual Report
Under the conditions that satisfying cash (3) The profit distribution shall not exceed the scope of the
dividends, the company will actively adopt cash cumulative distributive profits, and shall not impair the
dividends as the method of dividend distribution. In company's continuous operation ability.
principle, cash dividends will be implemented
(4) Time Interval of the Dividend Distribution
annually, and Board of Directors can propose the
company to implement medium-term cash dividends Under the conditions that satisfying cash dividends, the
in accordance with the company profitability and company will actively adopt cash dividends as the method of
financial needs. dividend distribution. In principle, cash dividends will be
implemented annually, and Board of Directors can propose
(5) The Issuance Conditions of Share Dividends
the company to implement medium-term cash dividends in
Based on the annual earnings and cash flow and on accordance with the company profitability and financial
the premise of guaranteeing the minimum cash needs.
dividend ratio and the reasonable equity scale and
(5) The Issuance Conditions of Share Dividends
ownership structure, the company can pay attention
to synchronizing equity expansion with business Based on the annual earnings and cash flow and on the
growth and consider to take the method of share premise of guaranteeing the minimum cash dividend ratio
dividend to distribute profits. and the reasonable equity scale and ownership structure, the
company can pay attention to synchronizing equity expansion
(6) Differentiated Cash Dividend Policies
with business growth and consider to take the method of
The Board of Directors shall take into account share dividend to distribute profits.
such factors as the characteristics of the industry the
(6) Differentiated Cash Dividend Policies
company engage, the development stages, its own
business models, profitability and whether there are The Board of Directors shall take into account such
major capital expenditure arrangements, distinguish factors as the characteristics of the industry the company
the following situations, and propose differentiated engage, the development stages, its own business models,
cash dividend policies in accordance with the profitability and whether there are major capital expenditure
procedures stipulated in the Article of Association: arrangements, distinguish the following situations, and
propose differentiated cash dividend policies in accordance
1, If a profit distribution occurs when the
with the procedures stipulated in the Article of Association:
company is in mutual development stage and has no
major capital expenditure arrangements, the cash 1, If a profit distribution occurs when the company is in
dividends shall account for at least 80% of the total mutual development stage and has no major capital
profits to be distributed; expenditure arrangements, the cash dividends shall account
for at least 80% of the total profits to be distributed;
2, If a profit distribution occurs when the
company is in mutual development stage and has 2, If a profit distribution occurs when the company is in
major capital expenditure arrangements, the cash mutual development stage and has major capital expenditure
dividends shall account for at least 40% of the total arrangements, the cash dividends shall account for at least
profits to be distributed; 40% of the total profits to be distributed;
3, If a profit distribution occurs when the company is 3, If a profit distribution occurs when the company is in
in growth stage and has major capital expenditure growth stage and has major capital expenditure arrangements,
arrangements, the cash dividends shall account for at the cash dividends shall account for at least 20% of the total
least 20% of the total profits to be distributed; profits to be distributed;
4, If the company's development stage is hard to 4, If the company's development stage is hard to distinguish but
37
Sino Great Wall Co., Ltd. 2016 Annual Report
distinguish but there are major capital expenditure there are major capital expenditure arrangements, the distribution
arrangements, the distribution of cash dividends can be of cash dividends can be dealt with in accordance with the
dealt with in accordance with the preceding provisions.4 preceding provisions.
(7) The Specific Conditions, Decision-making Process (7) The Specific Conditions, Decision-making Process and
and Mechanism to Adjust Profit Distribution Policy Mechanism to Adjust Profit Distribution Policy
Considering the production and management, Considering the production and management, investment
investment planning, long-term development needs planning, long-term development needs and external business
and external business environment, when the environment, when the adjustment or change to the profit
adjustment or change to the profit distribution policy distribution policy determined by the Article of Association is
determined by the Article of Association is absolutely absolutely necessary, the scheme for adjustment or change
necessary, the scheme for adjustment or change shall shall be drawn up by and submitted to the general meeting of
be drawn up by and submitted to the general meeting shareholders by the Board of Directors for diliberation. When
of shareholders by the Board of Directors for the general meeting of shareholders deliberates the change
diliberation. When the general meeting of for profit distribtion policy, it is a must that the deliberation is
shareholders deliberates the change for profit past by 2/3 of the voting rights held by the shareholders
distribtion policy, it is a must that the deliberation is present at the meeting and convenience is provided for the
past by 2/3 of the voting rights held by the small and medium shareholders to attend the general meeting
shareholders present at the meeting and convenience of shareholders. Independent directors shall express their
is provided for the small and medium shareholders to explicit independent opinions on the adjustment or change of
attend the general meeting of shareholders. profit distribution policy, and the Board of Supervisors shall
Independent directors shall express their explicit publish the audit opinion.
independent opinions on the adjustment or change of
(8) The Decision-making Process of Profit Distribution
profit distribution policy, and the Board of
Policy
Supervisors shall publish the audit opinion.
The annual profit distribution plan of the company shall
(8) The Decision-making Process of Profit
be proposed and laid down by the company’s management
Distribution Policy
and Board of Directors with the consideration of the
The annual profit distribution plan of the provisions of the Article of Association, profitability, capital
company shall be proposed and laid down by the needs and shareholder return planning, and be deliberated
company’s management and Board of Directors with and approved by the the general meeting of shareholders after
the consideration of the provisions of the Article of being reviewed by the Board of Directors. Independent
Association, profitability, capital needs and opinions to the profit distribution plan shall be made and
shareholder return planning, and be deliberated and publicly disclosed by independent directors.
approved by the the general meeting of shareholders
(9) The Board of Directors shall carefully study and
after being reviewed by the Board of Directors.
demonstrate the timing, conditions, minimum proportions,
Independent opinions to the profit distribution plan
conditions for adjustment and other decision-making
shall be made and publicly disclosed by independent
rocedural requirements of the cash dividend distribution in
directors.
the process of deliberating and making the profit distribution
(9) The Board of Directors shall carefully study plan; the independent directors shall express explicit
and demonstrate the timing, conditions, minimum opinions on it. The recommendations of the management, the
proportions, conditions for adjustment and other key points of the speech by shareholders attending the
decision-making rocedural requirements of the cash meeting, the opinions of independent directors, the vote the
dividend distribution in the process of deliberating Board of Directors and other contents shall be recorded in
38
Sino Great Wall Co., Ltd. 2016 Annual Report
and making the profit distribution plan; the detail and be properly kept as the company archives in
independent directors shall express explicit opinions written form.
on it. The recommendations of the management, the
(10) The general meeting of shareholders shall vote the
key points of the speech by shareholders attending
profit distribution plan proposed by the Board of Directors
the meeting, the opinions of independent directors,
according to the laws and rules. In the deliberation of the
the vote the Board of Directors and other contents
specific scheme for cash dividends, the general meeting of
shall be recorded in detail and be properly kept as the
shareholders shall communicate and exchange actively with
company archives in written form.
the shareholders, especially the small and medium
(10) The general meeting of shareholders shall shareholders, through multiple channels, fully heed the
vote the profit distribution plan proposed by the opinions and demands of the small and medium shareholders
Board of Directors according to the laws and rules. In and respond to their concerns in a timely manner. The Board
the deliberation of the specific scheme for cash of directors shall complete the distribution of dividends (or
dividends, the general meeting of shareholders shall shares) within 2 months after the resolution of profit sharing
communicate and exchange actively with the plan made by the general meeting of shareholders.
shareholders, especially the small and medium
(11) When the company get the annual profits but the
shareholders, through multiple channels, fully heed
management and the Board of Directors do not propose and
the opinions and demands of the small and medium
draw up the cash dividend plans, the management needs to
shareholders and respond to their concerns in a
submit to to the Board of Directors a detailed overview to this
timely manner. The Board of directors shall complete
issue, including the reasons for not distributing the dividends
the distribution of dividends (or shares) within 2
and the purpose and using plan of the retained funds which are
months after the resolution of profit sharing plan
not distributed, and independent opinions to the profit
made by the general meeting of shareholders.
distribution plan shall be made and publicly disclosed by
(11) When the company get the annual profits but independent directors; the overview will be deliberated by the
the management and the Board of Directors do not the general meeting of shareholders after being reviewed and
propose and draw up the cash dividend plans, the approved by the Board of Directors and it will be stated to the
management needs to submit to to the Board of general meeting of shareholders by the Board of Directors.
Directors a detailed overview to this issue, including
(12) The company shall disclose the implementation of
the reasons for not distributing the dividends and the
profit distribution plans and cash dividend policies in the
purpose and using plan of the retained funds which
annual report and semi-annual report in strict accordance
are not distributed, and independent opinions to the
with the relevant provisions. When the company get the
profit distribution plan shall be made and publicly
annual profits but no cash dividend plans are proposed, the
disclosed by independent directors; the overview will
reasons for not distributing the dividends and the purpose and
be deliberated by the the general meeting of
using plan of the retained funds which are not distributed
shareholders after being reviewed and approved by
shall be expounded in the annual report.
the Board of Directors and it will be stated to the
general meeting of shareholders by the Board of (13) The Board of Supervisors shall supervise the
Directors. implementation of the company's profit distribution policies and
the shareholder return plans as well as the decision-making
(12) The company shall disclose the
process executed by the Board of Directors and the management.
implementation of profit distribution plans and cash
When the company get the annual profits but no cash dividend
dividend policies in the annual report and
plans are proposed, the Board of Supervisors shall make a special
semi-annual report in strict accordance with the
statement and comment on the implementation of relevant policies
relevant provisions. When the company get the
and plans.
annual profits but no cash dividend plans are
39
Sino Great Wall Co., Ltd. 2016 Annual Report
proposed, the reasons for not distributing the
dividends and the purpose and using plan of the
retained funds which are not distributed shall be
expounded in the annual report.
(13) The Board of Supervisors shall supervise the
implementation of the company's profit distribution
policies and the shareholder return plans as well as the
decision-making process executed by the Board of
Directors and the management. When the company get the
annual profits but no cash dividend plans are proposed,
the Board of Supervisors shall make a special statement
and comment on the implementation of relevant policies
and plans.
Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement of Article
Yes
of Association (Yes/No)
Well-defined and clearly dividend standards and proportion
Yes
(Yes/No)
Completed relevant decision-making process and mechanism
Yes
(Yes/No)
Independent directors perform duties completely and play a
Yes
proper role (Yes/No) Y
Minority shareholders have ample opportunities and their
Yes
legitimate rights and interests are effectively protected (Yes/No)
Condition and procedures are compliance and transparent while
Yes
the cash bonus policy adjusted or changed (Yes/No)
The profit distribution preplan or proposal and the preplan or proposal of conversion of the capital reserve into
share capital in the past three years(with the reporting period inclusive):
Profit distribution preplan for 2014：
1 As audited by Da Hua Certified Public Accountants(Special General Partnership) , the total profit of the
Company for 2014 is RMB4,740,872 , After deduction of minority gains and losses of RMB-3,709 and income
tax expenses of RMB 453,676, net profit is RMB4,290,905,the total year-end undistributed profit is
RMB-103,768,226. The Company is neither to distribute profit nor to capitalize capital surplus for the current
year.
Profit distribution plan for 2015：
based on the 2015 total share capital of 446.906582 million shares, The Company will transfer the capital
reserve to increase capital stock, 28 shares for every 10 shares.
40
Sino Great Wall Co., Ltd. 2016 Annual Report
Dividend distribution of the latest three years
In RMB
Net profit
Ratio in net profit
attributable to the Amount of cash Proportion of cash
attributable to the
Cash dividend over of the parent dividends from cash dividends from cash
Year parent company in
(Including Tax) company in the offer to repurchase offer to repurchase
the consolidated
consolidated shares of the funds shares of the funds
financial statements
financial statements
2016 101,894,700.66 473,661,862.67 21.51% 0.00 0.00%
2015 0.00 346,648,651.48 0.00% 0.00 0.00%
2014 0.00 186,857,504.45 0.00% 0.00 0.00%
In the reporting period, both the Company’s profit and the parent company’s retained earnings were positive
however not cash dividend distribution proposal has been put forward.
□ Applicable □ Not appliable
II.Profit distribution plan and capitalizing of common reserves plan for the Period
√ Applicable □ Not applicable
Bonus shares for every ten shares(Shares) 0
Cash dividend for everty ten shares
0.60
(Yuan)(Tax-included)
Distribute additional (shares)for 10 shares 0
A total number of shares as the distribution
1,698,245,011
basis(shares)
Total cash dividend (Yuan)(Tax-included) 101,894,700.66
Proportion of cash dividend in the distributable
100.00%
profit (%)
Cash dividend distribution policy
If the company’s development is at the growth stage with arrangements of significant capital expenditures, the minimum proportion
of cash dividend in the profit distribution should reach 20%.
Details of proposal of profit distribution preplan or share conversion from capital public reserve
The Audit Report of LHZ(2017) No. 0263 issued by BDO China Shu Lun Pan Certified Public Accountants LLconfirms
that the company's net profit of 2016 that belongs to the shareholders is RMB 465,758,169.92. According to the
Article of Association, 10% of the profit, RMB 46,575,816.99, is drawn as the legal accumulation fund of the
company; At the end of this year, plus the profit of RMB 755,308,636.19, which was not distributed at the
beginning of last year, the profit serving as the distributive dividends for all shareholders is RMB
1,174,490,989.12. The company intends to distribute the cash dividends of RMB 0.60 yuan per 10 shares (tax incl.)
to all shareholders, taking the total equity of RMB 1,698,245,011 on December 31, 2016 as the base, with a total
distribution of RMB 101,894,700.66. The remaining un-allocated profit of RMB 1,072,596,288.46 will be carried
over to the next year.
41
Sino Great Wall Co., Ltd. 2016 Annual Report
III.Commitments to fulfill the situation
1.The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the
reporting period made by the company, shareholder, actual controller, acquirer, director, supervisor,
senior management personnel and other related parities.
√ Applicable □ Not applicable
Peiod
Time of
Commitment of Fulfil
Commitment Type Contents making
maker commi lment
commitment
tment
Commitment on share reform No No No No
Commitment in the acquisition report
No No No No
or the report on equity changes
Shares acquired by purchases of assets
through issuing shares: “I will not
transfer the new shares of Victor
Onward Holdings acquired through this
restructuring, including but not limited
to the public transfer through the stock
market or by agreement, and I will not
entrust anybody else to manage my
shares of Victor Onward Holdings,
within 36 months from the date new
shares list and before the date I’ve
carried out my obligations of
performance compensation under this
Strict
restructuring(subject to whatever is 36
Chen Lue, He Stock March perf
Commitments in assets reorganization early, hereinafter referred to as “lock-up month
Feiyan lock 19,2015 ormi
periods”). If the closing price of shares s
ng
of Victor Onward Holdings were lower
than this issue price for 20 continuous
trading days in 6 months after the
restructuring transaction has been
completed, or the final closing price
were lower than this issue price 6
months after the transaction has been
completed, the lock-up periods of my
shares of Victor Onward Holdings are
automatically prolonged for 6 months.
(The above-mentioned issue price will
be calculated according to the price
after the adjustment of ex-dividend, etc.
42
Sino Great Wall Co., Ltd. 2016 Annual Report
if ex-dividend behaviors of the
company, including distribution of
dividends, giving bonus, conversion of
share capital, rationing shares, and etc.,
were happened during the
above-mentioned periods. If the
restructuring transaction were March
19,2015 36 mont hs Strict perfor ming
Shenzhen Victor Onward Textile
Industrial Co., Ltd. The Third Quarterly
Report 2015. 14 investigated by judicial
authorities or China Securities
Regulatory Commission due to false
record, misleading statement or major
omission of the information provided or
disclosed, I will not transfer my shares
of the company before the conclusion of
the case has been made clear. After the
above-mentioned lock-up periods, I will
sell or transfer the new shares of the
company acquired from this
restructuring following relevant
regulations of China Securities
Regulatory commission and Shenzhen
Stock Exchange.
Shares acquired by matching funds
raised: “I will not transfer the new
shares of Victor Onward Holdings
acquired through this issuing by any
Strict
way, including but not limited to the 36
Stock March perf
Chen Lue public transfer through the stock market month
lock 19,2015 ormi
or by agreement, within 36 months from s
ng
the date new shares list. If regulation
rules or regulators have longer
requirements for lock-up periods, it
should be executed accordingly.
Up to the issue day of the letter, I and
other corporations controlled by me
No haven’t possessed funds of Sino Great Strict
capital Wall; After the transaction is completed, March Long-t perf
Chen Lue
occupa I and other companies controlled by me 19,2015 erm ormi
tion (if any), except for listed companies and ng
their holding subsidiaries, will not
possess the funds of listed companies or
43
Sino Great Wall Co., Ltd. 2016 Annual Report
Sino Great Wall by any way, including
cash in advance, other expenses, direct
or indirect loans, assumption, etc. and
try our best to avoid fund intercourse
with listed companies or Sino Great
Wall, which has nothing to do with
normal operations. If Sino Great Wall
got penalized by government
administration departments due to the
money lending which was happened
before the transaction, I will bear the
total compensation for the company’s
loss resulting from it by cash in order to
guarantee Sino Great Wall won’t suffer
any loss. Meanwhile, I will actively
urge Sino Great Wall to establish
complete inner control system and
funds management system within lawful
authority.
In view of the fact that the houses
rented by Sino Great Wall and it’s son
subsidiaries, subsidiaries, haven’t rental
Cash registration, I promise, if Sino Great Strict
compe Wall and its son subsidiaries, March Long-t perf
Chen Lue
nsatio subsidiaries, were penalized by real 19,2015 erm ormi
n estate management department or ng
suffered other losses resulting from it, I
agree to compensate the loss of the
company by cash.
During the reporting period, the project
which Sino Great Wall is involved in is
the decoration engineering construction
project of Libo Grand Hotel (hereinafter
referred to as “Libo project”) which the
company contracted before the bidding
Cash Strict
process. Sino Great Wall is not involved
compe March Long-t perf
Chen Lue in any other projects except for Libo
nsatio 19,2015 erm ormi
project before bidding process. As to the
n ng
violating issues existed in the Libo
project, I promise as follows: if Sino
Great Wall got penalized by government
administration departments or suffered
any economic loss resulted from it, I
will compensate the company by cash;
44
Sino Great Wall Co., Ltd. 2016 Annual Report
Meanwhile, I, within lawful authority,
will also promise to urge the company
to undertake related construction
projects legally so as to avoid violating
issues happened before implementation
of bidding process, i.e., at the time for
construction again.
“1. Up to October 13th,2014, the related
expenses of the litigation and arbitration
cases, including the actual price,
compensation, penalty, ligation costs,
etc. which the parent-subsidiary
companies of Sino Great Wall needs to
pay caused by the final results of
Cash ligation and arbitration cases, exceed Strict
compe the amount of liabilities which March Long-t perf
Chen Lue
nsatio recognized in the “Audit Report” made 19,2015 erm ormi
n for Sino Great Wall by Ruihua CPA ng
(Special Ordinary Partnership) on the
basis of the audit base day of July 31st,
2014, I promise to bear the balance by
cash unconditionally so as to guarantee
the parent-subsidiaries of Sino Great
Wall won’t suffer any loss. 2. This
commitment letter is irrevocable.
1. On condition that ownership defect
exists in the lease of house property of
parent-subsidiary companies of Sino
Great Wall and its subsidiary
corporation, which resulted in inability
for parent-subsidiary companies of Sino
Great Wall and its subsidiary
corporation to continue leasing this
Cash Strict
house property but having to relocate,
compe March Long-t perf
Chen Lue or parent-subsidiary companies of Sino
nsatio 19,2015 erm ormi
Great Wall and its subsidiary
n ng
corporation can’t timely find suitable
workplace for lawful operation in
related area, I will undertake to
compensate by cash for
parent-subsidiary companies of Sino
Great Wall’s losses which are caused by
operation and finance due to the
above-mentioned matters. 2. I undertake
45
Sino Great Wall Co., Ltd. 2016 Annual Report
to unconditionally bear the relevant
fines by cash for parent-subsidiary
companies of Sino Great Wall on
condition that the rental house property
of parent-subsidiary companies of Sino
Great Wall and its subsidiary
corporation is in absence of handling
procedures for filing house
leasing ,which resulted in that
parent-subsidiary companies of Sino
Great Wall and its subsidiary
corporation are fined by property
administrative department. 3.The
commitment letter is irrevocable.
“In condition that parent-subsidiary
companies of Sino Great Wall or its son
subsidiary haven’t paid social security
or housing fund for staff according to
law, which resulted in any losses to Sino
Great Wall , including the competent
Cash authorities’ requirement for Sino Great Strict
compe Wall or its subsidiary to make March Long-t perf
Chen Lue
nsatio supplementary payment, to be punished 19,2015 erm ormi
n and resourced, I will bear by ng
full-amount cash for the fee of
supplemental payment and the expense
and fee for being punished or resourced,
which is to guarantee Sino Great Wall
and its subsidiary to avoid suffering
from any loss ”.
“At present, Suzhou Lvbang has
possessed one state-own land use right,
of which the land certificate is Suzhou
Guo Yong(2014) No.Y2014086”,
locates in Danan Village, Dadian Town,
Cash Yongqiao District, Suzhou City with Strict
compe 32,966 square meters of area and the March Long-t perf
Chen Lue
nsatio purpose for industry. Suzhou Lvbang 19,2015 erm ormi
n possesses its own factory with 9,843.87 ng
square meters of area above-mentioned,
which is the building reserved on the
former selling land. Suzhou Lvbang is
carrying out refurnishing and
reconstruction for this factory and has
46
Sino Great Wall Co., Ltd. 2016 Annual Report
acquired “License of Construction Land
Planning ”with No.2014-08-001
approved and issued by Yongqiao
District, Suzhou City’s housing and
rural construction bureau, of which
other examination and approval
procedures of construction are in the
process of handling “I undertake to
actively supervise and urge Suzhou
Lvbang on handling procedures of the
approval process involved with factor
refurnishing and reconstruction, and
which is suffered from administrative
punishment by relevant competent
authorities in reason of claiming
certificate of title, or in which any
dispute or controversy exist in
construction and ownership, which shall
be my responsibility to carry out
solution, and I undertake to compensate
by cash for Suzhou Lvbang’s losses
which are due to this matter,
guaranteeing no losses occur to Sino
Great Wall and Suzhou Lvbang for this
matter.
“According to the “Agreement of
Significant Asset Replacement and
Issue of Share to Buy Asset”(hereinafter
referred to as “Agreement”) signed
among Victor Onward Holdings, all
shareholders of Sino Great Wall and
Union Development Group Co., Ltd
(hereinafter referred to as“ Union
Cash Strict
Group”) on October 13, 2014, all the
compe March Long-t perf
Chen Lue creditor’s rights and liabilities related to
nsatio 19,2015 erm ormi
place-out asset before the delivery date
n ng
of Victor Onward Holdings shall be
Union Group’s responsibility to carry
out solution; After the asset delivery
date, if any losses occur to Victor
Onward Holdings in reason of the
liability transfer of asset delivery,
personnel placement, unsettled dispute
or controversy and other compensation
47
Sino Great Wall Co., Ltd. 2016 Annual Report
related to place-out asset, payment
obligation and punishment, Union
Group or the specified third party shall
sufficiently compensate all losses for
Victor Onward Holdings for the above
matters. I undertake, if Union Group
and the specified third party refuse to
compensate the losses caused by the
above mentioned matters for Victor
Onward Holdings according to
the“ Agreement”, I will compensate by
cash for the Victor Onward Company
within 5 working day in advance.
Meanwhile, I will reserve the resource
rights for Union Group and the
specified third party “.
According to“ Agreement of Shenzhen
Victor Onward Textile Industrial Co.,
Ltd., Chen Lue and He Feiyan
Concerning on Performance
Compensation” and its supplemental
agreement , Chen Lue’s promised Sino
Great Wall that the net profit deducted
by incidental losses and attributable to
Perfor the parent companies’ owners after Strict
Chen Lue , He mance audition of 2015, 2016 and 2017 shall May Long-t perf
Feiyan commi be respectively more than RMB 345.8 11,2015 erm ormi
tment million, RMB 438.5 million and RMB ng
538.2 million. If the net profit of Sino
Great Wall is less than the promised net
profit mentioned above , Chen Lue and
He Feiyan will compensate for listed
company in accordance with
“Performance Compensation
Agreement” and its supplemental
agreement
Chen Lue; He 1. This reorganization is planned to
Feiyan, Wuxi place in asset. At present, complete
Hengtai Indepe separation has existed between me or Strict
Jiuding Assets ndent other enterprises under my possession September Long-t perf
Management compe (if any) and the listed company in staff, 30,2015 erm ormi
Centre tition asset, finance, institution and business ng
（LP）;Yantai of Sino Great Wall. Independence exists
Zhaoxuan in both staff, asset, finance, institution
48
Sino Great Wall Co., Ltd. 2016 Annual Report
Yuantai and business and no confusion exists. 2.
Jiuding I undertake, after this reorganization, to
Venture ensure the continued complete
Investment separation between me or other
Centre enterprises under my possession(if any)
（LP）;Suzho and the listed company in staff, asset,
u Taiyao finance, institution and business,
Zhongshan sustaining the independence in the listed
Jiuding company’s staff, asset, finance,
Investment institution and business, as follows:
Centre (1).The Ensurance of Independence for
（LP）;Jiaxing Listed Company’s Personnel Ensure
Jiahe Jiuding that the general manager, the
Investment vice-general manger, the chief financial
Centre（LP） officer, the board secretary and the
senior executives of the Company only
accept salary in listed company,
including no holding of any post except
director and supervisor in my enterprise
or other enterprises under my
possession. 2.Ensure the complete
independence exists among the listed
company’s labor, personnel, and salary
management and me. 3. The director,
supervisor, general manager and other
senior executives recommended by me
have all been through the legal
procedures, and I will not intervene the
company’s board and the shareholder’s
decision for appointing and dismissing
personnel by exercising official power.
(2)The Ensurance of the Asset
Independence of Listed Company
1.Ensure that the listed company
possesses business system related to
operation and the relevant
completely-independent asset. 2.Ensure
that no occupation of mine exists in
capitals and assets of the listed
company. 3.The Ensurance of the
Financial Independence of Listed
Company 1.Ensure that the independent
finance department and the independent
financial calculating system set up by
49
Sino Great Wall Co., Ltd. 2016 Annual Report
the listed company, which possess
normative and independent financial
and accounting rules. 2. Ensure that the
listed company independently opens a
bank account, not sharing the same
bank account with me. 3.Ensure that the
financial staff of the listed company
holds no part-time post in my enterprise
and other enterprises under my
possession. 4. Ensure that the listed
company pays taxes according to law. 5.
Ensure that the listed company makes
the financial decision-making
independently, I will not intervene the
utilization of the listed company’s
capital. (4)The Ensurance of the
Institutional Independence of Listed
Company 1.Ensure that the listed
company sets up perfect governance
structure for the share company’s legal
person, which possesses independent
and complete institutional framework
2.Ensure that the shareholder’s meeting,
the board of director, the independent
director, the supervisor and the general
managers exercise official powers
according to laws, regulations and
articles of incorporation (5)The
Ensurance of the Business
Independence of Listed Company 1.
Ensure that the listed company
possesses the asset, staff, qualification
and ability for independently holding
business activities, which possesses the
independent, autonomous and sustain
operation ability catering to the market.
2. Ensure that I will not intervene the
listed company’s business activities
except exercising shareholder’s rights.
3.Ensure that I or other enterprises
under my possession will avoid working
on the listed company’s main business
which possesses substantial
competition. 4. Ensure to reduce the
50
Sino Great Wall Co., Ltd. 2016 Annual Report
related transaction between me and the
listed company or between other
enterprises under my possession and the
listed company as much as possible;
When confirming necessary but
unavoidable related transaction, I will
ensure the fair operation according to
the principle of market culture and the
fair price, and fulfill the transaction
procedures and the obligation of
disclosing information according to
relevant laws and regulations and
normative document.
Chen Lue; He
Feiyan;Wuxi
Hengtai
Jiuding Assets
“Once I or our unit acquire the
Management
newly-added share of Victor Onward
Centre（LP）;
Company through this transaction, no
Yantai
transfers will occur in any way within
Zhaoxuan
12 months from the listing date,
Yuantai
including but not limited to public
Jiuding
Relate transfer by securities market or transfer
Venture Strict
d by agreement, and no entrusting for March Lont-t
Investment perfo
transac others to manage my holding share of 19,2015 erm
Centre rming
tion Victor Onward Holdings . Once the
（LP）;Suzho
above-mentioned lockup period expires,
u Tianyao
I will implement the selling or
Zhongshan
transferring of the newly-added share of
Jiuding
Victor Onward Holdings according to
Investment
the relevant provision of CSRC and
Centre（LP）;
SZSE.
Jiaxing Jiahe
Jiuding
Investment
Centre（LP）
During the assets reorganization, the
house property and land without
Union Incom property certificate in the disposed
Strict
Development e assets within the plant area of Kuixin March Long-t
perfo
Group Co., dispos Community of Kuichong Street of 19,2015 erm
rming
Ltd. al Longgang District and the expected
compensations, as well as the expected
compensations concerning to the
51
Sino Great Wall Co., Ltd. 2016 Annual Report
regaining of plots planned as schools
within the right of land use of Nanyou
Industrial Park of Nanshan District have
not been recorded in the assessment.
Therefore, Union Group promises that
after the reorganization, if Union or a
third party appointed by Union receives
compensations or incomes related
toabove-mentioned disposed assets
which are house property and land
without property certificate as well as
regaining of plots planned as schools,
Union will return the benefits to Victor
Onward Holdings, in 10 working days
since the collection. The actual costs
and fees during the possession of the
house property and land and the paid as
well as the unpaid but necessary costs
and fees for the reception of the
above-mentioned benefits for Union
Group or its third party will be deducted
from the income. The specific benefits
and payable costs and fees should be
confirmed jointly by Union Group and
Victor Onward Holdings based on the
actual situations. （ Notes:On June 25,
2015,All shareholders of Victor Onward
Holdings, Union Group and Sino Great
Wall Signed supplementary agreement,
and specified that the land and houses
without ownership certificate of Victor
Onward Holdings located at the factory
area of Kuixin community of Kuichong
street office of Longgang district (the
land area is about 50,000 square meters,
the built-up area of houses is about
25,000 square meters, among them
about 18,000 square meters of buildings
at built-up area are within the plan of
removal and collection of government，
hereinafter referred as “undocumented
property) still belongs to Victor Onward
Holdings. And the benefits and risks of
the real estate without certificate are
52
Sino Great Wall Co., Ltd. 2016 Annual Report
enjoyed and assumed by Victor Onward
Holdings.”
According to the Term 5.5.3 of
Agreement on Major Asset
Replacement and Asset Purchase
Through Issuing Shares (hereinafter
referred to as Agreement) signed on
October 13, 2014 by the company and
all shareholders of Victor Onward Co.
Ltd.. and Sino Great Wall, Victor
Onward Holdings should obtain the
letter of approval concerning the
transferred debts of the disposed assets
from the creditor (including the
guarantee, similarly hereinafter) before
the date of assets delivery. In the
situation of debts on Victor Onward
Holdings due to the absence of
creditor’s consent, the company or the
third party appointed by the company is
in charge of paying off debts or
Union Cash reaching agreement on the solution with
Strict
Development compe the creditor. When there are losses March Long-t
perfo
Group Co., nsatio caused by improper solutions of the 19,2015 erm
rming
Ltd n company or the third party appointed by
the company, the company or the third
party appointed by the company will
fully compensate for the caused losses
of Victor Onward Holdings in 5
working days after receiving the notice.
According to the Term 5.5.4 of
Agreement, after the date of assets
delivery, any compensations,
obligations of payment and penalties
caused by disposed assets as well as
unsettled disputes in Victor Onward
Holdings will be undertaken and solved
by the company or the third party
appointed by the company, and Victor
Onward Holdings assumes no
responsibility. When there are losses
caused by it, the company or the third
party appointed by the company will
fully compensate for the caused losses
53
Sino Great Wall Co., Ltd. 2016 Annual Report
of Victor Onward Holdings in 5
working days after receiving the notice.
According to the Term 5.6.1 of
Agreement and based on the principle
of “staff arrangement according to the
assets”, the labor relations, social
insurance relations including pension,
medical treatment, unemployment,
working injury and maternity, and other
liable welfare and salary of all the staff
in Victor Onward Holdings. (including
but not limited to on-post Shenzhen
Victor Onward Textile Industrial Co.,
Ltd. The Third Quarterly Report 2015.
25 employees, employees awaiting job
assignments, retired employees,
retained employees with suspend salary,
transferred employees, and temporary
employees, etc) will be transferred to
the company or the third party
appointed by the company.
Compensations or related matters (if
any) due to the termination of labor
relationship in advance with Victor
Onward Holdings, the company or the
third party appointed by the company
will be in charge of the payment. The
company promises that for the losses
caused by matters such as the
above-mentioned debt transfers of
disposed assets, personnel arrangement,
unsettled disputes, potential debts,
payment obligations and penalties, the
company or the third party appointed by
the company will fully compensate for
the losses of Victor Onward Holdings
due to the above-mentioned matters
based on the Agreement in cash.
1.Guarantee that interest will be
transferred to other units or individuals
All directors Strict
Fill which are with compensation or without Long-t
of the July 7,2016 perfo
returns fair conditions, neither other ways erm
company rming
which are harmful to the Company’s
interest will be adopted;2.Guarantee
54
Sino Great Wall Co., Ltd. 2016 Annual Report
restraint conduction for the duty
consuming behavior of directors and
senior managers;3.Guarantee that no
capital of the Company will be
employed for engaging in investment or
consumption which are not involved
with duty performance;4.Guarantee that
the compensation system formulated by
the board of director or Compensation
and Assessment Committee is linked
with the exertion situation of the
Company’s return filling solution;5.
Shall stock incentive mechanism
subsequently be introduced by the
Company, the exertion condition of the
Company’s stock incentive mechanism
which is intended to be published is
guaranteed to be linked with the
exertion situation of the Company’s
return filling solution;6.When stock
incentive mechanism is intended to be
carried out subsequently , I promise,
within the legal range, to prompt the
exertion condition of the Company’s
stock incentive mechanism which is
intended to publish is guaranteed to be
linked with the exertion situation of the
Company’s return filling solution;7. I
promise the commitments above will be
fulfilled strictly, and guarantee actual
fulfillment for the Company’s return
filling solution. Shall any commitments
be violated or be refused to fulfill by
me, I will fulfill corresponding
obligations of explanation and apology
according to relevant regulations of
Guidance on First Issue, Refinancing,
Major Asset Reorganization and
Dilution for Return at Sight by CSRC,
and will approve the supervision
measures or self-discipline supervision
measures made by CSRC, SZSE and
China Association for Public
Companies. Any losses occurred upon
55
Sino Great Wall Co., Ltd. 2016 Annual Report
he Company or the shareholders, I am
willing to undertake the responsibility
for corresponding compensation in
accordance with laws.
Guarantee that no operating
Strict
Chen Lue, He Fill management will be intervened with Long-t
July 7,2016 perfo
Feiyan returns exceeded authority, and no interest of erm
rming
the Company will be expropriated.
Commitments make in initial public
No No No No
offering or re-financing
Equity incentive commitment No No No No
Other commitments for medium and
No No No No
small shareholders
Completed on time(Y/N) Yes
If the commitments is not fulfilled on
time, shall explain the specify reason Nil
and the next work plan
2.The existence of the company's assets or projects earnings forecasts and earnings reporting period is still
in the forecast period, the company has assets or projects meet the original profit forecast made and the
reasons explained
□Applicable √ Not applicable
IV.Particulars about the non-operating occupation of funds by the controlling shareholder
□ Applicable √ Not applicable
No non-operating occupation from controlling shareholders and its related party in the period.
V.Explanation of the Supervisory Committee and Independent Directors (If applicable)on the Qualified
Auditor’s Report Issued by the CPAs.
□ Applicable √ Not applicable
VI.Explain change of the accounting policy, accounting estimate and measurement methods as compared
with the financial reporting of last year.
√Applicable □Not applicable
Nil
56
Sino Great Wall Co., Ltd. 2016 Annual Report
VII.Explain retrospective restatement due to correction of significant accounting errors in the reporting
period
□Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the
period.
VIII.Explain change of the consolidation scope as compared with the financial reporting of last year.
√Applicable □Not applicable
1. Companies into merger range newly in this stage
In 2016, the company founded Sino Great wall Medicare investment Co., Ltd., Sino Great wall
Infrastructure Investment Co., Ltd. and Wuhan Vocational Hospital Co., Ltd. wholly owned by the company by
cash offer, Sino Great wall Xinan Construction Co., Ltd. (Original name: Sichuan Dinghui Construction Co., Ltd.)
which is wholly bought by subsidiary Sino International, Sino Great wall Changcheng Construction Co., Ltd.
(Original name: Sichuan Haoyao Construction Co., Ltd.) is 60% bought by share issue by the company.
Meanwhile, Shenzhou International founded newly subsidiaries called Sino Great wall Property (Hubei) Co., Ltd.
and Sino Great wall Development (Hengqin) Co., Ltd. Then the above newly founded companies and newly
bought companies began to be into the merger range of the company since 2016.
2. Companies not into merger account range in this stage
2In 2016, Sino International cancelled holding companies called Sino Heji Recycled Material Co., Ltd.,
which was not in the merger range.
IX. Engagement/Disengagement of CPAs
CPAs currently engaged
Name of the domestic CPAs BDO China Shu Lun Pan Certified Public Accountants LLP
Remuneration for domestic accounting firm
115
(RMB’0000)
Continuous life of auditing service for domestic
2
accounting firm
Name of domestic CPA Liao Jiahe, Shu Shibao
Has the CPAs been changed in the current period
√ Yes □No
Whether to change the accounting firm during the audit period
□ Yes √No
Description of the CPAs, financial adiver or sponsor engaged for intemal control auditing
√Applicable □Not applicable
In the current year, the company engaged BDO China Shu Lun Pan Certified Public Accountants LLP as the
internal control audit accounting firm, during the period, the company totally pays RMB 0.35million for the
57
Sino Great Wall Co., Ltd. 2016 Annual Report
internal control audit expenses.
X.Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly Report
□Applicable √ Not applicable
XI.Bankruptcy reorganization
□Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period.
XII.Significant lawsuits and arbitrations of the Company
□Applicable √ Not applicable
No significant lawsuits and arbitrations occourred in the reporting period.
XIII.Situation of Punishment and Rectification
□Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.
XIV.Credit Condition of the Company and its Controlling Shareholders and Actual Controllers
√Applicable □ Not applicable
XV.Implementation Situation of Stock Incentive Plan of the Company, Employee Stock Ownership Plan or
Other Employee Incentive Measures
√Applicable □ Not applicable
The second meeting of the seventh board of directors, the second meeting of the seventh board of supervisors and
the 2015 third extraordinary general shareholder meeting were respectively convened by the company on Nov 5,
2015 and Nov 23, 205, at which the Proposal on the First Phase of Employee Stock Ownership Plan (draft) of
Shenzhen Victor Onward Textile Industrial Co., Ltd was examined and approved.
Please refer to the published on November 7, 2015, the securities times, the Hong Kong Commercial Daily and
cninfo (www.cninfo.com.cn) on the relevant announcement.
On December 24, 2015, the company as the asset trustor of the ESOP asset management plan, together with the
asset manager- Xingzheng Securities Asset Management Co.,Ltd and the asset trustee- China Everbright Bank
Co.,Ltd signed the contract of No.57 Xing Zheng Zi Guan Xin Zhong Assets Management Contract of the
Collection Assets Management Plan which concretely explained and stipulated the information included the basic
information of the collection plan, participating in and withdrawal of the collection plan, guarantee, classification
of the collection plan, the management methods and the management rights of the customer assets in the
collection plan, the establishment of the collection plan, the expenses of the collection plan, the proceeds and its
distribution of the collection plan, investment philosophy and investment strategy, investment decision-making
58
Sino Great Wall Co., Ltd. 2016 Annual Report
and risk control, restrictions and prohibited behaviors of investment, information disclosure of the collection plan,
transfer of the share of the collection plan, non-transaction transfer ownership and freezing and so on.
Please refer to the published on December 29, 2015, the securities times, the Hong Kong Commercial Daily and
cninfo (www.cninfo.com.cn) on the relevant announcement.
As of January 7, 2016, the company’s first phase of the employee stock ownership plan has completed the
share-purchasing by means of buying in the secondary security market, of which the average position price is
RMB44.7578 per share, the total purchase quantity is 833,187 shares which account for 0.1864% of the
company's total share capital, and the total turnover is RMB37,291,630. The lock-up period of the shares
purchased under the plan is 12 months commenced from the date of this announcement.
Please refer to the published on January 8, 2016, the securities times, the Hong Kong Commercial Daily and
cninfo (www.cninfo.com.cn) on the relevant announcement.
XVI.Material related transactions
1. Related transactions in connection with daily operation
√Applicable □ Not applicable
Whethe
Trading r over
Principl
limit the Market Index
Subjects e of
Amount price of of
of the pricing Ratio in approve approve Way of Date of
Related Relation Type of Price of of trade similar informa
related the similar paymen disclosu
parties ship trade trade RMB0’ trade tion
transacti related trades d d t re
000 availabl disclos
ons transacti
e ure
ons （RMB limited
’0000） or not
(Y/N)
The
compan
y where
the
Qinghai Procure Quarterl
Compan
Heyi ment of Material Market Market y
y’s 1,959 6,000 No
Trade goods/s Goods price price settleme
director
Co., Ltd. ervices nt
holds
the post
of legal
person
Give the actual situation in the report According to the 2016 routine operational needs and the current market price of the
period where a forecast had been procurement materials, the company is expected to complete the routinely related-party
made for the total amounts of routine transactions of total RMB 60 million with the related party Qinghai Heyi Commerce Co.,
related-party transactions by type to Ltd, which had been deliberated and approved by the 2015 annual general meeting of
occur in the current period(if any) shareholders. In 2016, the amount of the actual transactions with Qinghai Heyi Commerce
59
Sino Great Wall Co., Ltd. 2016 Annual Report
Co., Ltd is RMB 19.59 million, which doesn’t surpass the approved transaction limit.
2. Related-party transactions arising from asset acquisition or sold
□Applicable √ Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period.
3. Related-party transitions with joint investments
□Applicable √ Not applicable
No main related transactions of joint investment outside for the Company in reporting period.
4. Credits and liabilities with related parties
√Applicable □Not applicable
Was there any non-operating credit or liability with any related party?
□ Yes √ Not
Nil
5. Other significant related-party transactions
□Applicable √ Not applicable
No other material related transactions.
XVII.Particulars about significant contracts and their fulfillment
1. Particulars about trusteeship, contract and lease
(1) Trusteeship
□Applicable √ Not applicable
No trusteeship, contract or leasing for the Company in reporting period.
(2) Contract
□ Applicable √ Not applicable
No any contract for the Company in the reporting period.
(3) Lease
□Applicable √ Not applicable
No any lease for the Company in the reporting period..
60
Sino Great Wall Co., Ltd. 2016 Annual Report
2.Guarantees
√ Applicable □ Not applicable
（1）Guarantees
In RMB’0000
Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries)
Relevant
Date of Guarantee
disclosure Complete
happening Actual for
date/No. of Amount of implementa
Name of the Company (Date of mount of Guarantee type Guarantee term associated
the Guarantee tion
signing guarantee parties
guaranteed or not
agreement) (Yes or no)
amount
Total of external guarantee
Total of external guarantee
0 actually occurred in the 0
approved in the report term (A1)
report term (A2)
Total of external guarantee Total of external guarantee
approved as of end of report term 0 actually occurred as of end 0
(A3) of report term (A4)
Guarantee of the company for its subsidiaries
Amount of Actual date of
Amount of Actual
guarantee occurring Type of Complete Related
Guarantee provided to the amount of Term
and date of (signing date of guarantee d or not guarantee
guarantee guarantee
disclosure agreements
Sino Great Wall 15,000
Sino Great Wall 15,000
Sino Great Wall 5,000
Sino Great Wall 13,000
Sino Great Wall 8,400
Sino Great Wall 14,000
Sino Great Wall 25,000
Sino Great Wall 20,000
Sino Great Wall 18,000
Sino Great Wall 40,000
Sino Great Wall 5,000
Sino Great Wall 10,000
Sino Great Wall 20,000
Sino International 10,000
Sino International 12,000
Sino International 25,714
61
Sino Great Wall Co., Ltd. 2016 Annual Report
Sino International 20,000
Sino International 20,000
Sino International 10,000
Sino International 10,000
Sino International 20,000
Sino International 50,000
Guarantee of the subsidiaries for the controlling subsidiaries
Guarante
Relevant e
Date of Complete
disclosure for
Name of the Amount happening Actual implemen
date/No. of Guarantee Guarantee associate
Company of (Date o mount of tation
the type term d
guaranteed guarantee signing guarantee or
guaranteed parties
agreement) not
amount (Yes or
no)
The Company’s total guarantee(i.e.total of the first three main items)
Including：
Description of the guarantee with complex method
（2）Illegal external guarantee
□ Applicable √ Not applicable
Nil
3.Situation of Entrusting Others for Managing Spot Asset
(1)Situation of Entrusted Finance
□ Applicable √ Not applicable
Nil
(2)Situation of Entrusted Loans
62
Sino Great Wall Co., Ltd. 2016 Annual Report
□ Applicable √ Not applicable
Nil
4. Other significant contract
XVIII.Explanation about other significant matters
√ Applicable □ Not appliable
On July 7, 2016, the 10th meeting of the 7th Board of Directors and the 7th meeting of the 7th Board of
Supervisors were convened to examined and adopted the related proposals on non-publci Issuing of Shares. On
July 25, 2016, the 2nd provisional general meeting of shareholders was convened to deliberate and approve the
related proposals on Private Issuing of Shares.
On October 14, 2016, CSRC Receipt Notice on Administrative Licensing Application released by CSRC was
received. The application documents for administrative licensing submitted by the company were reviewed and
considered to be complete and conform to the legal form by CSRC, and the administrative licensing application
was accepted by CSRC.
On December 2, 2016, CSRC Feedback Notice on the Review of Administrative Licensing Projects by CSRC was
received. The company took a prompt action to check the relevant problems seriously with agencies such as the
sponsor institution, Zhongde Securities Co., Ltd, analyzed and replied the problems one by one in accordance with
the request of the Feedback and made a public disclosure on December 27.
The company's project of private issuing of A-share remains the examination and approval by CSRC and getting
the approval is still uncertain. The company will comply with its duty of information disclosure according to the
progress of the project, and kindly ask the investors to pay attention to the investment risk.
XIX.Major issues of subsidiary
√ Applicable □ Not appliable
1, In May 2016, the company made an acquisition of 100% equity ownership of Wuhan Commercial Staff
Hospital LLC, the details of which can be acquired on the Notice of the Equity Ownership Acquisition of Wuhan
Commercial Staff Hospital LLC by Sino Great Wall Co., Ltd. published on www.cninfo.com.cn on May 11, 2016;
2, In November 2016, the wholly-owned subsidiary, Sino Great Wall International Engineering Co., Ltd. acquired
60% of the equity ownership from Sichuan Haoyao Construction Co., Ltd by means of increasing in capital and
stock, the details of which can be acquired on the Foreign Investment Notice of the Investment by Capital
Increase and Stock Expansion and the Plan to Establish A Subsidiary by the Wholly-owned Subsidiary of Sino
Great Wall Co., Ltd published on www.cninfo.com.cn on November 10, 2016.
63
Sino Great Wall Co., Ltd. 2016 Annual Report
VI. Change of share capital and shareholding of Principal
Shareholders
Ⅰ.Changes in share capital
1. Changes in share capital
In shares
Before the change Increase/decrease（+，-） After the Change
Amount Proporti Bon
Share Capitalization
on us Othe Proportio
allotm of common Subtotal Quantity
shar r n
ent reserve fund
es
-374
1.Shares with conditional
277,880,626 62.18% 778,065,752 ,910, 403,155,185 681,035,811 40.10%
subscription
567
-374
3.Other domestic shares 277,880,626 62.18% 778,065,752 ,910, 403,155,185 681,035,811 40.10%
567
-337
Including ：Domestic
99,888,348 22.35% 279,687,374 ,096, -57,408,676 42,479,672 2.50%
Legal person shares
050
-37,
Domestic natural person
177,992,278 39.83% 498,378,378 814, 460,563,861 638,556,139 37.60%
shares
517
II.Shares with 374,
169,025,956 37.82% 473,272,677 910, 848,183,244 1,017,209,200 59.90%
unconditional subscription 567
374,
1.Common shares in
99,604,053 22.29% 278,891,349 910, 653,801,916 753,405,969 44.36%
RMB
567
2.Foreign shares in
69,421,903 15.53% 194,381,328 0 194,381,328 263,803,231 15.54%
domestic market
III. Total of capital shares 446,906,582 100.00% 1,251,338,429 1,251,338,429 1,698,245,011 100.00%
Reasons for share changed
√ Applicable □Not applicable
In 2016, upon the base of total share capital of 446,906,582 shares on the date of December 31, 2015, 28 shares
were increased for every 10 shares to all the shareholders by converting capital reserve into share capital,
64
Sino Great Wall Co., Ltd. 2016 Annual Report
therefore the total increased shares by converting capital reserve into share capital were 1,251,338,429 shares, so
the total share capital were 1,698,245,011 shares after such share increasing by converting capital reserve into
share capital.
Approval of Change of Shares
□ Applicable √ Not applicable
Ownership transfer of share changes
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to
common shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators
□ Applicable √ Not applicable
2. Change of shares with limited sales condition
√ Applicable □Not applicable
In shares
Number of
Number of Restricted Shares Date of
Initial Restricted Increased Reason for
Shareholder Name Unrestricted in the End of the Restriction
Shares Restricted Shares Restricted Shares
Shares This Term Term Removal
This Term
The major asset
restructuring and
the issue of
Chen Lue 138,248,490 0 387,095,772 525,344,262 shares to October 14,2018
purchase assets
and raise
matching funds
The major asset
restructuring and
the issue of
November
Chen Lue 14,735,772 0 41,260,162 55,995,934 shares to
27,2018
purchase assets
and raise
matching funds
Shanghai Financial
The major asset
Development 20,079,080 76,300,504 56,221,424 0 October 14,2016
Investment restructuring and
65
Sino Great Wall Co., Ltd. 2016 Annual Report
Fund(LP)
the issue of
shares to
purchase assets
and raise
matching funds
The major asset
restructuring and
the issue of
He Feiyan 14,421,173 40,379,284 54,800,457 shares to October 14,2018
purchase assets
and raise
matching funds
The major asset
Jiutai Fund－Bank
restructuring and
of
Communications－ the issue of
November
Jiutai Huitong 11,178,861 42,479,672 31,300,811 0 shares to
27,2016
No.2 specific
purchase assets
customer asset
management plan and raise
matching funds
The major asset
restructuring and
Wuxi Hengtai
the issue of
Jiuding Assets
10,087,004 38,330,615 28,243,611 0 shares to October 14,2016
Management
Centre（LP） purchase assets
and raise
matching funds
The major asset
restructuring and
Foshan Haihui
the issue of
Heying Venture
10,039,540 38,150,252 28,110,712 0 shares to October 14,2016
Investment
Partnership（LP） purchase assets
and raise
matching funds
Jiangxi Taihao
8,366,284 31,791,879 23,425,595 0 The major asset October 14,2016
Venture Investment
66
Sino Great Wall Co., Ltd. 2016 Annual Report
Centre(LP）
restructuring and
the issue of
shares to
purchase assets
and raise
matching funds
The major asset
restructuring and
Yantai
ZhaoxuanYuantai the issue of
Jiuding Venture 8,353,354 31,742,745 23,389,391 0 shares to October 14,2016
Investment
purchase assets
Centre(LP)
and raise
matching funds
The major asset
restructuring and
Suzhou Tianyao
the issue of
Zhongshan Jiuding
7,551,634 28,696,209 21,144,575 0 shares to October 14,2016
Investment
Centre(LP) purchase assets
and raise
matching funds
The major asset
restructuring and
Jiaxing Jiahe the issue of
Jiuding Investment 7,499,912 28,499,666 20,999,754 0 shares to October 14,2016
Centre(LP)
purchase assets
and raise
matching funds
The major asset
restructuring and
Beijing Xinhe
the issue of
Taida Investment
6,693,140 25,433,932 18,740,792 0 shares to October 14,2016
Management
Centre(LP) purchase assets
and raise
matching funds
67
Sino Great Wall Co., Ltd. 2016 Annual Report
The major asset
restructuring and
the issue of
Wu Chenxi 5,019,770 19,075,126 14,055,356 0 shares to October 14,2016
purchase assets
and raise
matching funds
The major asset
restructuring and
Beijing Longbai
the issue of
Huirun Investment
5,019,770 19,075,126 14,055,356 0 shares to October 14,2016
Management
Centre(GP) purchase assets
and raise
matching funds
The major asset
restructuring and
the issue of
Zhu Lijun 3,346,514 12,716,753 9,370,239 0 shares to October 14,2016
purchase assets
and raise
matching funds
The major asset
restructuring and
Shenzhen
Septwolves the issue of
Shenglian Equity 3,346,514 12,716,753 9,370,239 0 shares to October 14,2016
Investment Fund
purchase assets
Co., Ltd.
and raise
matching funds
The major asset
restructuring and
the issue of
Feng Renyi 1,673,255 6,358,369 4,685,114 0 October 14,2016
shares to
purchase assets
and raise
68
Sino Great Wall Co., Ltd. 2016 Annual Report
matching funds
The major asset
restructuring and
Shenzhen Jiayuan
the issue of
Qihang Venture
1,673,255 6,358,369 4,685,114 0 shares to October 14,2016
Investment
Company(LP) purchase assets
and raise
matching funds
The major asset
restructuring and
the issue of
He Sen 430,904 0 1,206,531 1,637,435 shares to October 14,2018
purchase assets
and raise
matching funds
Total 277,764,226 375,246,299 777,739,833 637,778,088.2 -- --
II.Issuing and listing
1.Explanation of the Situation of the Security Issue(No Preferred Shares) in the Report Period
□ Applicable √ Not applicable
2.Change of asset and liability structure caused by change of total capital shares and structure
√ Applicable □ Not applicable
In the report period, upon the base of total share capital of 446,906,582 shares on the date of December 31, 2015,
28 shares were increased for every 10 shares to all the shareholders by converting capital reserve into share capital,
therefore the total increased shares by converting capital reserve into share capital were 1,251,338,429 shares, so
the total share capital were 1,698,245,011 shares after such share increasing by converting capital reserve into
share capital.
3.About the existing employees’ shares
□Applicable√Not applicable
69
Sino Great Wall Co., Ltd. 2016 Annual Report
III.Shareholders and actual controlling shareholder
1. Number of shareholders and shareholding
In Share
The total number o Total
Total number Total
f preferred shareho preferred shareh
of common shareholders at
lders voting rights olders at the end
shareholders at the end of the
59,940 restored at period-e 0 of the month 0
the end of the month from the
nd from the date of
reporting date of disclosing
(if any)(See disclosing the
period the annual report
Notes 8) annual report
Shareholding of shareholders holding more than 5% shares
Proporti Number of share
Number of Changes in Amount of Amount of
Nuture of on of pledged/frozen
Shareholders shares held at reporting restricted un-restricted
shareholder shares State of
period -end period shares held shares held Amount
held（%） share
Domestic 434,660,59
Chen Lue 34.33% 582,944,556 +429,808,094 582,109,696 834,860 Mortgage
Natural person 4
STYLE-SUCCESS Foreign legal
5.47% 92,970,910 +68,504,881 0 92,970,910
LIMITED person
Domestic Non-
Union Holdings
State-owned 5.18% 87,935,921 +44,794,889 0 87,935,921
Co., Ltd.
legal person
Domestic
He Feiyan 3.23% 54,800,458 +40,379,285 54,800,458 0
Natural person
Jiutai Fund－Bank
of
Communications－
Jiutai Huitong Other 2.50% 42,479,672 +31,300,811 42,479,672 0
No.2 specific
customer asset
management plan
Rich Crown
Foreign legal
Investment Co., 1.37% 23,235,313 +17,120,757 0 23,235,313
person
Ltd.
Jiangxi Taihao Domestic Non-
Venture Investment State-owned 1.11% 18,791,879 +10,425,595 0 18,791,879
Centre(LP） legal person
Bank of China－ Other 1.07% 18,200,320 0 18,200,320
70
Sino Great Wall Co., Ltd. 2016 Annual Report
Fortis Income
Growth Securities
Investment Fund
ICBC－Huitianfu
private activity of
Other 1.02% 17,292,602 0 17,292,602
hybrid securities
investment fund
China National
Petroleum
Corporation Other 0.88% 14,982,390 0 14,982,390
Pension Plan－
ICBC
Strategy investors or general legal
person becomes top 10 shareholders
Nil
due to rights issued (if
applicable)See Notes 3）
The largest shareholder of Mr. Chen Lue and the Fourth largest shareholder of Ms. He Feiyan
Explanation on associated aforesaid are persons acting in concernp; The controlling shareholder of the above-mentioned
relationship among the aforesaid third shareholder Shenzhen Union Holdings Co.,Ltd. and sixth shareholder Rich Crown
shareholders Investment Co., Ltd.. Is Union Development Group Ltd. whether the other shareholders have
associated relations are unknown.
Shareholding of top 10 shareholders of unrestricted shares
Share type
Name of the shareholder Quantity of unrestricted shares held at the end of the reporting period
Share type Quantity
Foreign
shares
STYLE-SUCCESS LIMITED 92,970,910 placed in 92,970,910
domestic
exchange
RMB
Union Holdings Co., Ltd. 87,935,921 Common 87,935,921
shares
Foreign
shares
Rich Crown Investment Co., Ltd. 23,235,313 placed in 23,235,313
domestic
exchange
RMB
Jiangxi Taihao Venture Investment
18,791,879 Common 18,791,879
Centre(LP）
shares
Bank of China－Fortis Income 18,200,320 RMB 18,200,320
71
Sino Great Wall Co., Ltd. 2016 Annual Report
Growth Securities Investment Fund Common
shares
RMB
ICBC－Huitianfu private activity of
17,292,602 Common 17,292,602
hybrid securities investment fund
shares
RMB
China National Petroleum
14,982,390 Common 14,982,390
Corporation Pension Plan－ICBC
shares
RMB
Qinghai Heyi Mining Co., Ltd. 13,356,984 Common 13,356,984
shares
RMB
Jiangwei 9,761,860 Common 9,761,860
shares
RMB
Shanghai Financial Development
9,540,962 Common 9,540,962
Investment Fund(LP)
shares
Explanation on associated
relationship or consistent action
among the top 10 shareholders of The controlling shareholder of the above-mentioned largest shareholder Shenzhen Union
non-restricted negotiable shares and Holdings Ltd. and third shareholder Rich Crown Investment Co., Ltd.. Is Union Development
that between the top 10 shareholders Group Ltd.
of non-restricted negotiable shares
and top 10 shareholders
Notes to the shareholders involved
in financing securities (if any)(See Nil
Notes 4)
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a
buy-back agreement dealing in reporting period.
□ Yes √ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company
have no buy –back agreement dealing in reporting period.
2.Controlling shareholder
Nature of Controlling Shareholders: Natural Person Holding
Type of Controlling Shareholders: Natural Person
Whether to obtain the right of abode in other countries
Name Nationality
or regions
Chen Lue China No
Main occoupations and duties Chairman and General Manager of the Company
72
Sino Great Wall Co., Ltd. 2016 Annual Report
Situation of domestic and abroad holding
Nil
listed companies in the reporting period.
Change of the actual controller in the reporting period
□ Appliable √ Not applicable
Nil
3．Information about the controlling shareholder of the Company
Actual controller nature：Domestic naturaol person
Actual controller type：Natural person
Whether to obtain the right of abode in other countries or
Name Nationality
regions
Chen Lue China No
Main occoupations and duties Chairman and General Manager of the Company
Situation of domestic and abroad holding
Nil
listed companies in the part 10 years
Changes of the actual controller in the reporting period
□Applicable √Not applicable
No Changes of the actual controller in the reporting period
Block Diagram of the ownership and control relations between the company and the actual controller
The actual controller controls the company by means of trust or managing the assets in other way
□Applicable √Not applicable
4.Particulars about other legal person shareholders with over 10% shareheld
□Applicable √Not applicable
73
Sino Great Wall Co., Ltd. 2016 Annual Report
5.Situation of Share Limitation Reduction of Controlling Shareholders, Actual Controllers, Restructuring
Party and Other Commitment Subjects
□Applicable √Not applicable
74
Sino Great Wall Co., Ltd. 2016 Annual Report
VII. Situation of the Preferred Shares
□ Applicable √ Not Applicable
The Company had no preferred shares in the reporting period
75
Sino Great Wall Co., Ltd. 2016 Annual Report
VIII. Information about Directors, Supervisors and Senior Executives
I. Change ein shares held by directors, supervisors and senior executives
Amount Amount
of shares of shares
Shares held increase decrease Other Shares held at
Expiry
Office Starting date at the d at the d at the changes the
Name Positions Sex Age date of
status of tenure year-begin(s reportin reportin increase/dec year-gegin(sh
tenure
hare) g g rease are)
period(s period(s
hare) hare)
Board
chairman, October October
Chen Lue In office Male 46 153,136,462 270,000 0 429,538,094 582,944,556
General 29,2015 28,2018
Manager
Hu May October
Director In office Male 54 0 0 0 0 0
Yongfeng 12,2000 28,2018
Director,
Deputy October October
Li Erlong In office Male 41 3,000 0 0 8,400 11,400
General 29,2015 28,2018
Manager
Director,
Liang Deputy October 29, October
In office Male 47 0 0 0 0 0
Rong General 2015 28,2018
Manager
October 29, October
Wang Lei Director In office Male 53 0 0 0 0 0
2015 28,2018
October 29, October
Ban Bin Director In office Male 31 0 0 0 0 0
2015 28,2018
Independ
Tang October 29, October
ent In office Male 51 0 0 0 0 0
Jianxin 2015 28,2018
Director
Independ
Zhang October 29, October
ent In office Male 53 0 0 0 0 0
Yufeng 2015 28,2018
Director
Jiang Independ
October 29, October
Chonggua ent In office Male 41 0 0 0 0 0
2015 28,2018
ng Director
76
Sino Great Wall Co., Ltd. 2016 Annual Report
Chairman
of the
October
Dong superviso June
In office Male 67 28,201 0 0 0 0 0
Binggen ry 26,2002
8
committe
e
Huang Superviso October 29, October
In office Male 45 0 0 0 0 0
Shengde r 2015 28,2018
Wu Superviso October 29, October
In office Male 36 0 0 0 0 0
Xiaoming r 2015 28,2018
Cui October 29, October
CFO In office Female 44 0 0 0 0 0
Hongli 2015 28,2018
Secretary
Yang to the October 29, October
In office Female 45 0 0 0 0 0
Chunling board of 2015 28,2018
directors
Deputy Septemb
Song October
General Retired Female 44 er 0 0 0 0 0
Chenling 29,2015
Manager 27,2016
Total -- -- -- -- -- -- 153,139,462 270,000 0 429,546,494 582,955,956
II. Change in shares held by directors, supervisors and senior executives
√ Appicable □Not applicable
Name Positions Types Date Reason
Deputy General September
Song Chenling Retired Personal reasons
Manager 27,2016
III.Posts holding
Work Experience in the past five years of Directors, supervisors and senior Executives in Current office
(1) Director
Mr. Chen Lue, male, Chinese nationality, no overseas permanent residence, born in April 1970, currently the
doctoral students of accounting specialty in Wuhan University, Senior Management MBA of Guanghua School of
Management of Beijing University, Senior Management MBA of School of Economics and Management of
Tsinghua University, Bachelor in major of Food Science and Nutritional Engineering of China Agricultural
University, senior engineer. He had served as a technician in Zhuhai Fisheries Group Canned Food Factory,
project manager in Guangdong Yuexi Construction Company, vice general manager in Guizhou Construction
Engineering Group Dongguan Company, vice general manager in Shenzhen Great Wall Furniture Decoration
Engineering Co., Ltd. Currently, he is the Vice Chairman of Beijing Decoration Association, Director of
Informatization Committee of China Building Decoration Association, director of information technology
77
Sino Great Wall Co., Ltd. 2016 Annual Report
committee, executive member of China Building Decoration Association, the first chairman of Beijing-Zhanjiang
Business Association. From June 2006 to September 2014, he was the chairman of the Great Wall Construction
Engineering Co. Ltd; from December 2007 to September 2014, he served as the general manager of the Great
Wall Construction Engineering Co. Ltd; from May 2011 to September 2014, he served as the supervisor of Sino
Great Wall Construction Engineering (Liaoning) Co., Ltd. since 2001, he has been the executive director and
chairman of the board of the Sino Great Wall International Engineering Co., Ltd; since November 2007, he has
been the executive director of Sino Great Wall (Beijing) Decoration Design Co., Ltd; since February 2011, he has
been the supervisor of Sino Great Wall Decoration Engineering (Shenyang) Co., Ltd; since April 2014, he has
been the executive director and general manager of Sino Great Wall Investment (Beijing) Co., Ltd; since
September 2015, he has been the chairman and the general manager of Sino Great Wall Cubic Investment Co.,
Ltd; since October 2015, he has been the chairman of the board and the general manager of the company.
Mr. Hu Yongfeng, Chinese nationality, no overseas permanent residence ,male, born in July 1962, graduated from
East China Textile Engineering College in 1983, bachelor, senior engineer.
Mr. Li Erlong, Chinese nationality, no overseas permanent residence, male, was born in September 1975,
graduated from the Shandong Building Materials Engineering College, MBA of Tsinghua University. He had
served as the assistant to director of the National Building Materials Quality Supervision and Inspection Center,
the researcher for the China-Africa R&D Center of Artificial Crystal. Since March 2005, he has been served as the
general manager of the Sino Great Wall International Engineering Co., Ltd; since November 2007, he has been
the general manager of Beijing Sino Great Wall Decoration Design Co., Ltd.; since June 2014, he has been the
executive director of the Sino Heji Environmental-protection Material Co., Ltd; since September 2015, he has
been the director of Sino Cubic Investment Co., Ltd; since October 2015, he has been the company’s director and
vice general manager.
Mr. Wang Lei, Chinese nationality, no overseas permanent residence, male, born in March 1963, senior
management MBA of School of economics and management of Tsinghua University, currently pursuing the
finance EMBA of PBC School of Finance, senior engineer. He had Served as the general manager of Anshan
Yongxin Engineering General Contracting Company, vice president of Chinese Enterprises Investment Company,
director and general manager of Henan Shunyuan Aluminum Industry Co.,Ltd, director and vice chief-economist
of Henan Coal Chemical Industry Group Co., Ltd. Since April 2013, he has been the chairman of Shanghai
Heyi Supply Chain Management Co., Ltd.; since October 2015, he has been the company’s director.
Mr. Bai Bin, Chinese nationality, no overseas permanent residence, male, born in 1985, master of law,
possesses vocational qualification of lawyer and law. He had successively served as the lawyer of Beijing Jingda
Law Firm, investment manager, Investment Director, general manager of the asset management department and
so forth posts of Kunwu Jiuding Investment Management Co.,Ltd. Currently, he is the general manager of Jiuxin
Asset Management Co.,Ltd, director of Sino High-speed Rail technology Co.,Ltd, director of Beijing UTS
International Travel Service Co., Ltd, director of Sino Great Wall International Engineering Co., Ltd, director of
Sichuan Dawei Science and Technology Co., Ltd and so on. Since October 2015, he has been the company’s
director.
Mr. Tang Jianxin, male, Chinese nationality, no overseas permanent residence, born in December 1965, Doctor,
Professor, doctoral supervisor, registered auditor, Certified Public Valuer. He had served as the deputy director in
Hainan Spring Auditor Firm, independent director of Wuhan Zhongnan Commercial Group Co., Ltd, independent
director of Wuhan Sanzhen Industry Holding Co., Ltd. Since 1995, he has been teaching at Wuhan University.
Currently, he is the professor and dean of accounting department of Wuhan University. From June 2008 to June
78
Sino Great Wall Co., Ltd. 2016 Annual Report
2014, he had been served as the independent director of Wuhan Zhongnan Commercial Group Co., Ltd.; from
June 2009 to July 2015, he had been served as the independent director of Wuhan Sanzhen Industry Holding Co.,
Ltd; since August 2010, he has been the independent director of Shenzhen Hua Pengfei Modern Logistics Co., Ltd;
since November 2011, he has been the independent director of Wuhan Zhongbai Group Co., Ltd.; since May 2013,
he has been the independent director of Pingdingshan Tianan Coal Industry Co., Ltd; since October 2015, he has
been the independent director of the company.
Mr. Zhang Yufeng, male, Chinese nationality, no overseas permanent residence, born in November 1963,
Master's degree, EMBA of PBC School of Finance of Tsinghua University. He had served as the principal staff
member of the discipline inspection team stationed in Ministry of health from the Commission for Discipline
Inspection of the Central Committee of the CPC, Project Manager of China Hualian Real Estate Company, project
manager of the Import and Export Department of China Construction Engineering Corporation, lawyer of Great
Wall Law Firm of Department of Commerce. Currently, he is the director of Beijing Great Wall Law Firm; since
June 2011, he has been the independent director of NetPosa Technologies Ltd; since May 2013, he has been the
independent director of Bank of Langfang; since October 2015, he has been the independent director of the
company.Since October 2016, he has been the independent director of Dezhan Health Co., Ltd., Since February
2017, he bas been the independent director of Nanhuihuang Technology Co., Ltd.
Mr. Jiang Chongguang, male, Chinese nationality, no overseas permanent residence, born in 1975, PhD in
finance of Chinese Academy of Social Sciences, PhD in economics, graduated from Peking University,
Fordham University and Chinese Academy of Social Sciences. He had served as the middle, senior management
staff in Haier Group, managing director of Singapore CKSP Group. Currently, he is the researcher of the
Non-governmental organization and Public Administration Research Center of Chinese Academy of Social
Sciences, executive director of Health China Strategy Research Center; chief economist and director of Ivy capital;
vice executive chairman of the China Old-age Health International Alliance; permanent financial adviser to
China- Israel Exchange Association of the High-tech Committee of Israel Parliament; independent director of
Singapore CKSP; expert and committee member of Hospital Management Research Institute of Tsinghua
University; expert and committee member of China Social Medical Research Association of MOHRSS; since
October 2015, he has been the independent director of the company.and vice-chairman of China endowment
Health International Union, Senior management of Haier Group, Director General Manager of Singapore CKSP
Group.
2. Supervisors
Mr. Dong Binggen, male, born in July 1949, bachelor, senior engineer, graduated from East China Textile
Engineering College in 1977. He had served as the vice president of Zhejiang Silk Industry Institute, general
manager of China Garment General Corporation, chairman of China National Garment Association, and so on.
Currently, he is the party secretary, chairman of the board and president of Union Development Group Co., Ltd;
chairman of the board of Union Holdings Co., Ltd; since June 2002, he has been the chairman of the board of
supervisors of the company.
Mr. Huang Shengde, male, born in January 1972; Hongkong Chinese; obtained the high Diploma of City
University of Hongkong in architecture, bachelor （ honorary degree ） of University of South Australia in
Architecture, MBA (financial) of the business school of The University of Manchester; he had served in the
Hopewell Slip-form Engineering Co. Ltd, China Foundation Engineering Co. Ltd, Qian Tian Construction Co.,
Ltd, Hongkong Xing Sheng Construction Co. Ltd, Wu Teng (Hongkong) Co. Ltd, Beijing Xingrong Real Estate
Development Co., Ltd, Yoma Strategic Holdings Co.,Ltd and Intecs Vantage Capitals Ltd; he had the management
and professional qualifications, including the member of 2006-Hongkong Project Management Association, the
member of 2006 Chinese Engineering Cost Association, the member of 2002 Hongkong Surveyors Association,
79
Sino Great Wall Co., Ltd. 2016 Annual Report
the member of 2002 Royal Institution of Chartered Surveyors, the member of 2001 Australian Institute of
Quantity Surveyors Association, the member of 2001-2004 British Cost Engineers Council and the member of
2001-2004 Australian Institute of architects. Currently, he is the vice general manager of Sino Great Wall
International Engineering Co., Ltd mainly in charge of overseas business cooperation and business development;
since October, 2015, he has been the company’s supervisor.
Mr. Wu Xiaoming, male, Chinese nationality, no overseas permanent residence,born in November 1980, Bachelor
in law, graduated from the law school of Guangdong Business College (now as Guangdong University of Finance
& Economics) with major in law. He had served in Guangzhou Municipal Bureau of Quality and Technical
Supervision Haizhu Branch ( now as Guangzhou Haizhu District Bureau of Quality and Technical Supervision);
since December 2008, he has been the assistant to general manager and Legal Department Manager of Sino Great
Wall International Engineering Co., Ltd; since June 2014, he has been the chairman of the board of supervisors of
Sino Great Wall International Engineering Co., Ltd; since October 2015, he has been the company’s supervisor.
3. Senior management personnel
Please see detailed work experience of Mr. Chen Lue,Mr.Li Erlong and and Mr. Liang Rong in the column of
directors.
Mrs. Yang Chunling, female, Chinese nationality, no overseas permanent residence, born in February 1971,
Bachelor in economics, master in industrial engineering, accountant. She had served as employee in Sinotrans
Henan Zhengzhou Logistic and Trading Company, Deputy Minister of the securities department of Aeolus Tyre
Co., Ltd, vice general manager and secretary of the board of directors of Henan Yuhua New Material Co., Ltd.
Since September 2015, she has been the director of Sino Cubic Investment Co., Ltd; since March 2014, she has
been the secretary of the board of directors of Sino Great Wall International Engineering Co., Ltd; since October
2015, she has been the secretary of the board of directors of the company.
Mrs. Cui Hongli, female, Chinese nationality, no overseas permanent residence, born in January 1972, graduated
from Henan University of Finance and Economics, CPA. She had been served in China Luoyang Float Glass
Group Co.,Ltd, Beijing Jiayou Real Estate Development Group Co.,Ltd and Yuancheng Industrial Group Co.,Ltd.
Since July 2011, she has been the investment and finance department manager, CFO of Sino Great Wall
International Engineering Co., Ltd; since October 2015, she has been the company’s CFO.
Office taking in shareholder companies
□ Applicable √Not applicable
Offices taken in other organizations
√Applicable □Not applicable
Whether
receiving
Office term
Name Name of other units Position Office term start from remuneration
ended
from other
units or not
Sino Great Wall International Engineering Board
Chen Lue October 17,2001 Yes
Co., Ltd. chairman
Beijing Sino Great Wall Decoration Design Executive
Chen Lue November 28,2007 No
Co., Ltd. director
Chen Lue Sino Great Wall Investment (Beijing) Co., Executive April 22, 2014 No
80
Sino Great Wall Co., Ltd. 2016 Annual Report
Ltd. director,Gene
ral Manager
Board
Chen Lue China Investment & Investment Co., Ltd. September 14,2015 No
chairman
Executive
Chen Lue Shenzhen Sino Dalue Investment Co., Ltd. February 25,2015 No
director
Vice
Hu Yongfeng Union Development Group Co., Ltd. May 18,2012 May 17,2015 No
President
Vice Board
Hu Yongfeng Union Holdings Co., Ltd. June 21, 2013 June 20, 2016 No
chairman
Sino Great Wall International Engineering General
Li Erlong March 1,2005 Yes
Co., Ltd. Manager
Sino Great Wall International Engineering
Li Erlong Director June 1,2014 No
Co., Ltd.
Sino Great Wall International Engineering Board
Li Erlong June 29,2016 No
Co., Ltd. chairman
Beijing Sino Great Wall Decoration Design
Li Erlong Manager November 28,2007 No
Co., Ltd.
Executive
Li Erlong Sino Heji Environmental Material Co., Ltd. September 2,2015 No
director
Li Erlong China Investment & Investment Co., Ltd. Director September 14,2015 No
Executive
Sino Great Wall International Engineering
Liang Rong General April 1,2003 June 29,2016 Yes
Co., Ltd.
Manger
Sino Great Wall International Engineering
Liang Rong Director June 1,2014 No
Co., Ltd.
Sino Great Wall International
Liang Rong Director November 17,2014 No
Engineering(Macao) Co., Ltd.
Board
Wang Lei Qinghai Heyi Mining Co., Ltd. September 2, 2008 No
chairman
Board
Wang Lei Qinghai Heyi Trade Co., Ltd. May 8, 2009 No
chairman
Shanghai Heyi Supply chain Management Board
Wang Lei April 7, 2013 Yes
Co., Ltd. chairman
General September
Bai Bin Jiuxin Assets Management Co., Ltd. September 9,2015 Yes
Manger 8,2018
Bai Bin CHSR Director April 27,2016 April 28,2019 No
Sino Great Wall International Engineering October
Bai Bin Director October 30,2015 No
Co., Ltd. 29,2018
81
Sino Great Wall Co., Ltd. 2016 Annual Report
Professor
ofAccountin
g
Department ,
Tang Jianxin Wuhan University December 1,2004 Yes
Economics
and
Management
School
Independent
Tang Jianxin Wuhan Zhongbai Group Co., Ltd. November 1,2011 Yes
Director
Independent
Tang Jianxin Pingdingshan Tianan Coal Co., Ltd. May 17,2013 Yes
Director
Yicang Dongyangguang Changjiang Independent
Tang Jianxin October 1,2015 Yes
Medicine Co., Ltd. Director
Zhang Yufeng Beijing Great Wall Law Firm Director Yes
Independent
Zhang Yufeng Langfang Bank May 1,2013 Yes
Director
Independent
Zhang Yufeng Dezhan Health Co., Ltd. October 8,2016 Yes
director
Independent
Zhang Yufeng Henan Huihuang Technology Co., Ltd. February 10,2017 Yes
director
Jiang Centre of Health China Strategy Research of Executive
May 1,2015 Yes
Chongguang Chinese Academy of Social sciences director
Jiang Graduate School of Chinese Academy of September
MBA Tutor September 1,2013 Yes
Chongguang Social Sciences 1,2019
Chief
Jiang
Ivy Capital Economist， May 1,2015 Yes
Chongguang
Director
Lifelong
Jiang High tech Committee of the Israeli
Financial March 1,2014 Yes
Chongguang parliament to exchange association
advisor
Jiang Independent January
Singapor CKSP December 1,2015 Yes
Chongguang Director 1,2025
Jiang Deputy
China Insurance Association June 15,2016 June 15,2021 Yes
Chongguang Secretary
Jiang Independent November
Dezhan Health Co., Ltd. November 1,2016 Yes
Chongguang Director 1,2019
Jiang China Health Economics Center, Beijing Special
October 1,2016 No
Chongguang University researcher
82
Sino Great Wall Co., Ltd. 2016 Annual Report
Secretary of
Party
committee,
Dong Binggen Union Development Group Co., Ltd. chairman of May 18,2012 Yes
board of
directors and
President
Board
Dong Binggen Union Holdings Co., Ltd. June 21, 2013 No
chairman
Deputy
Sino Great Wall International Engineering
Huang Desheng Generaql Yes
Co., Ltd.
Manager
Assistant
General
Sino Great Wall International Engineering
Wu Xiaoming Manager, December 1,2008 Yes
Co., Ltd.
Manager of
Law Dept.
Chairman of
Sino Great Wall International Engineering the
Wu Xiaoming June 1,2014 Yes
Co., Ltd. supervisory
committee
Sino Great Wall International Engineering Board
Yang Chunling March 1,2014 Yes
Co., Ltd. secretary
Yang Chunling China Investment & Investment Co., Ltd. Diretor September 1,2015 No
Manager
Sino Great Wall International Engineering
Cui Hongli ofInvestmen July 1,2011 Yes
Co., Ltd.
t Dept, CFO
Except the concurrently hold posts in the above-mentioned information, the company’s directors, supervisors,
Notes
senior management staff do not hold other posts or concurrently hold other posts in any other companies.
Punishments to the current and leaving board directors, supervisors and senior managers during the report period
by securities regulators in the recent three years
□ Applicable √Not applicable
IV. Remuneration to directors, supervisors and senior executives
Decision-making procedures, basis for determination and actual payment of the remuneration to directors ,
supervisors and senior executives
The remuneration appraisal committee of the board of directors of the Company proposed remuneration
standards according to the responsibilities, work scope and importance of directors, supervisors and senior
executives, the earnings of the Company for the current year and the remuneration level of relevant post and
submitted it to the board of directors for approval. After approval, the remuneration was paid on monthly basis.
83
Sino Great Wall Co., Ltd. 2016 Annual Report
The remuneration of independent directors is subject to approval by the shareholders' meeting.
Remuneration to directors, supervisors and senior executives in the reporting period
In RMB’0000
Total Remuneration
remuneration actually receivect
Name Positions Sex Age Office status
received from the at the end of the
shareholder reporting period
Board Chairman,
Chen Lue Male 46 In Office 36.6 Yes
General Manager
Hu Yongfeng Director Male 54 In office 0 Yes
Director, Deputy
Li Erlong Male 41 In Office 28.2 Yes
General Manger
Director, Deputy
Liang Rong Male 47 In office 27 Yes
General Manger
Wang Lei Director Male 53 In Office 0 Yes
Bai Bin Director Male 31 In Office 0 Yes
Independent
Tang Jianxin Male 51 In office 9.5 No
Director
Independent
Zhang Yufeng Male 53 In Office 9.5 No
Director
Jiang Independent
Male 41 In office 9.5 No
Chongguang Director
Chairman of the
Dong Binggen supervisory Male 67 In Office 0 Yes
committee
Huang Desheng Supervisor Male 45 In office 6.75 Yes
Wu Xiaoming Supervisor Male 36 In Office 11.7 Yes
Cui Hongli CFO Female 44 In office 22.56 Yes
Secretary to the
Yang Chunling Female 45 In Office 14.1 Yes
board of directors
Deputy General
Song Chenling Female 44 In Office 22.78 Yes
Manger
Total -- -- -- -- 198.19 --
Incentive equity to directors, supervisors or/and senior executives in the reporting period
□ Applicable √Not applicable
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Sino Great Wall Co., Ltd. 2016 Annual Report
V. Particulars about employees.
1.Number of staff, professional structure and educational background
Number of in-service staff of the parent company（person） 20
Number of in-service staff of the main subsidiaries（person） 2,000
Total number of the in-service staff（person） 2,200
Total number of staff receiving remuneration in the current
2,200
period（person）
Professional
Classified according by Professions Number of persons（person）
Production 50
Sales 1,000
Technical 50
Financial 100
Administrative 1,000
Total 2,200
Education
Classified according by Professions Number of persons（person）
Total 2,200
2. Remuneration policies
The company, in accordance with the principle of marketization, provides competitive salary and welfare of
the industry, differentiates the salary based on the positions, rewards those who perform well, and determine the
employee’s salary level in accordance with the benefit, positions and sales performance.
3.Training plan
The company sticks to the concept of ”people first” and values talent cultivation. To improve the employees’
professional ability and occupational skills, standardize and improve its training management, and boost
employees’ enthusiasm for learning, applying, delivering and creating knowledge, the company organizes
induction training and daily training for all employees and conducts induction training for fresh undergraduates
recruited from university campus. It also opens up networking academy, where it has complete curriculum system
for all employee to study independently and hold training lectures specially for improving professional skills or
knowledge on a regular basis. The company also carries out points system for employee training. Employees’
points gained from attending training will serve as an important basis for the performance assessment, personnel
transfer, promotion, salary adjustment, etc..
85
Sino Great Wall Co., Ltd. 2016 Annual Report
4.Outsourcing situation
□ Applicable √ Not Applicable
86
Sino Great Wall Co., Ltd. 2016 Annual Report
IX. Administrative structure
I.Basic state of corporate governance
The company’s governance meets the requirements of regular documents on the governance of the listed
companies issued by China Securities Regulatory Commission.
During the reporting period, The company has strictly abided by the relevant laws, rules and regulations requested
on “Corporate Law”, “Securities Law”, “Listing Rules of Shenzhen Stock Exchange” and
“Governance Rules of Listed Companies” and by China Securities Regulatory Commission, established and
perfected the internal control management system, and constantly made the deep improvement of the corporate
governance activities to further standardize the company operations and improve the management level. The
company’s governance meets the basic requirements of regular documents on the governance of the listed
companies issued by China Securities Regulatory Commission.
(1).Shareholders and shareholders' general meeting: The Company convened and held shareholders' general
meeting strictly according to the requirements of Opinions on Standardization of Shareholders' General Meeting
of Listed Companies, formulated Rules of Procedure of Shareholders' General Meeting, ensured all shareholders,
especially medium and small shareholders, enjoy equal position and can fully exercise their own rights.
(2).Relationship between the controlling shareholder and the Company: The acts of the controlling shareholder of
the Company were standardized. It did not exceed the authority of the shareholders' general meeting to directly or
indirectly intervene with the decision-making and operating activities of the Company. The Company is
independent from its controlling shareholder in respect of personnel, assets, finance, organ and business. The
board of directors, the supervisory committee and internal organ of the Company are able to operate
independently.
(3) The Directors and The Board of Directors: the Board of Directors includes four special committees, such as
Audit Committee, Nomination Committee, Strategy Committee and Remuneration and Appraisal Committee,
which has provided a favorable support to the company for the decision-making related issues. Each special
committee has operated according to their work responsibilities and procedure rules, made research and
examination for the relative business and major issues of the company, and expressed the professional opinions in
the Board of Directors to offer support and advice for the scientific decision-making of the Board and ensure the
Board’s work more scientific and efficient. Also, the organization of the Board of Directors is in line with the
requirement of laws and regulations, and the independent directors play an important role in the corporate
decision-making. So, the company attaches importance to the function of the independent directors. In the
company’s management, the independent directors make careful review and express the independent views for the
financial audit, the affiliated transactions and other issues.
(4).Supervisors and the supervisory committee: The number and composition of the Supervisory Committee of the
Company complied with the requirements of laws and regulations. The Supervisory Committee of the Company
formulated the Rules of Procedure of the Supervisory Committee. The supervisors of the Company were able to
perform their duties seriously, take the attitude of being responsible for all shareholders and supervise the legality
and regulation conformity of the Company's finance and the duty performance of the directors, managers and
other senior executives of the Company.
(5) The Company and The Affiliated Party: the affiliated transactions between the company and the affiliated
party are strictly managed and the audit of the affiliated transactions is performed in accordance with the relevant
procedures. Also, the affiliated transactions are in compliance with the laws and regulations, and there not exist
the issues that the major shareholders make use of the affiliated transactions to occupy the funds of the listed
company.
(6)Information disclosure and transparency: The Company designated the secretary to the board of directors to be
responsible for information disclosure, Regulations on Management of Information Disclosure,Regulations on
Management of External Information Users and reception of shareholder and consultation. In the report period,
the Company was able to truly, accurately, completely and timely disclose relevant information according to the
provisions of laws, regulations and the Articles of Association of the Company. The Company will continue to
operate in a standardized way strictly according to the requirements of relevant laws and regulations including the
Company Law, further perfect company administration structure and establish and improve various regulations in
87
Sino Great Wall Co., Ltd. 2016 Annual Report
light of the gap with the requirements of Standards of Administration of Listed Companies, ensure the
maximization of shareholders' interests and safeguard the lawful rights and interests of all shareholders.
In the report period, The Company further increased information transparency and properly carried out publicity
work for protection of investors. It timely answered the questions of investors and communicated with medium
and small investors by making use of telephone, email, especially the platform for communication with investors
set up by Shenzhen Stock Exchange to let them know itself better.
Does there exist any difference in compliance with the corporate governance , the PRC Company Law and the
relevant provisions of CSRC,
□ Yes √ No
There exist no difference in compliance with the corporate governance , the PRC Company Law and the relevant
provisions of CSRC.
II. Independence and Completeness in business, personnel , assets, organization and finance
The company is completely separate with the controlling shareholder in terms of the business, personnel, assets,
organizations, finance and other aspects, possessing independent and complete business and independent
operating capacity.
1.Business ： The Company has complete business and the ability of independent operation. It is completely
independent from its controlling shareholder in respect of business. There is no unfair related transaction or
horizontal competition between the company and the controlling shareholders or its affiliated enterprises.
2.Personnel ： The company has a completely independent personnel management and salary system. The
company’s senior manager personnel all are work in the company and receiving remunerations, and they do not
hold any other posts except the post of director or receive remunerations in the controlling shareholder and its
affiliated enterprises. The company's financial staffs do not concurrently hold posts in the controlling shareholder
and its affiliated enterprises.
3.Assets ： The company possesses independent place of business, independent land use rights, ownership of
buildings and so forth assets, possesses the production system related to the production and operation, legally
possesses the equipments related to production and operation and has Independent purchase, sales system and
supporting facilities.
4.Organization ： The company established a sound internal operation management organization, independently
exercising the operation and management rights, and there is no situation of confounding organization with the
controlling shareholder and its affiliated enterprises.
5.Finance:The company has a standardized financial accounting system, with an independent financial accounting
department, full-time accounting personnel and independent accounting system, being able to make financial
decisions independently. The company has set up the independent bank account and independently pays the tax.
The situation of the free-occupying of the company’s assets and funds by the controlling shareholder and its
affiliated enterprises does not exist.
III. Horiontal Competitions
□Applicable√Not applicable
IV. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period
1.Annual General Meeting
Investor
Sessions Type
participation ratio
Meeting Date Disclosure date Disclosure index
The first provisional
shareholders’
General meeting in
The first provisional 2016 (No.2016-025)
Provisional
shareholders’ published on
shareholders’ 44.03% March 30,2016 March 31,2016
General meeting in Securities
General Meeting
2016 Times,Hong Kong
Commercial Daily
and Juchao Website
（http://www.cninfo
88
Sino Great Wall Co., Ltd. 2016 Annual Report
.com.cn）on March
31,2016.
Annual General
Meeting of 2015
(No.2016-038)
published on
Securities
Annual Genral Annual General Times,Hong Kong
42.68% May 6,2016 May 7,2016
Meeting of 2015 Meeting Commercial Daily
and Juchao Website
（http://www.cninfo
.com.cn）on May
7,2016.
The second
provisional
shareholders’
General meeting in
The second 2016(No.2016-065)
provisional Provisional published on
shareholders’ shareholders’ 43.01% July 25,2017 July 26,2017 Securities
General meeting in General Meeting Times,Hong Kong
2016 Commercial Daily
and Juchao Website
（http://www.cninfo
.com.cn）on July
26,,2016.
The fourth
provisional
shareholders’
General meeting in
The Fourth 2016(No.2016-104)
provisional Provisional published on
shareholders’ shareholders’ 41.08% December 26,2016 December 27,2016 Securities
General meeting in General Meeting Times,Hong Kong
2016 Commercial Daily
and Juchao Website
（http://www.cninfo
.com.cn）on
December 27,2016.
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √Not applicable
V. Responsibility performance of independent directors in report period
1. The attending of independent directors to board meetings and shareholders’ general meeting
The attending of independent directors
Number of Failure to
Number of
Board meetings Number of personally attend
Independent Number of spot meetings Number of
necessary to be attendances by board meetings
Directors attendances attended by absence
attended in the representative successively
Communication
reporting period twice (Yes/No)
Tang Jianxin 11 2 9 0 0 No
Zhang Yufeng 11 1 10 0 0 No
Jiang Chongguang 11 1 10 0 0 No
Number of general meetings attended 4
by independent directors as non-voting
89
Sino Great Wall Co., Ltd. 2016 Annual Report
delegates
Notes to failure to personally attend Board Meetings Successively Twice
2.Objection of independent directors on some relevant issues
Objection of independent directors on some relevant issues
□ Yes √No
Nil
3. Other notes to duty performance of independent directors
Has an independent director’s advice to the Company been accepted
√Yes □ No
Explanation on acceptance of or failure to accept an independent director’s advice to the Company.
During the reporting period,The independent directors of the Company put forward a lot of professional
opinions on the laws and regulations and the Articles of Association of the Company, and paid attention to the
operation of the Company, performed their duties independently, formulated the system of the Company and the
day-to-day business decision-making of the Company. Independent directors issued an opinion on the issue of
independent and impartial opinions, in order to improve the company's supervision mechanism, safeguard the
legitimate rights and interests of the company and all shareholders play a due role.
VI. Duty Performance of Special Committees under the Board of Directors in the Reporting Period
The board of directors of the Company has special committees including audit committee, remuneration and
appraisal committee, strategy committee and nomination committee. According to the scope of authority specified
in the working rules for them, the committees conducted study and put forward opinions and suggestions for
reference by the board of directors for decision making.
According to relevant regulations of CSRC, the audit committee of the board of directors of the Company did
the following work during the preparation of the annual report of the Company for 2016:
1. On February 3, 2016, the audit committee of the board of directors reviewed the company’s financial
accounting statement 2015 and published the following opinions: the financial accounting statement 2015
prepared by the company basically reflected its financial standing and operating results, and audit committee
agreed to engage in the yearly financial statement auditing work on this basis, requested the financial department
to provide active cooperation in assisting with this audit, strengthen communication and contact, and timely
reflect the problems and audit work progress to audit committee.
2
2.On March 10, 2016, the Audit Committee of the board of directors deliberated the Proposal on Alteration and
Engaging of the 2015 Annual Audit Agency, considering the Dahua Certified Public Accountants (special general
partnership) had provided audit service for the company in consecutive years, in order to ensure the independence
and objectivity of the audit work, after the Audit Committee of the board conscientiously examined, then
proposed the alteration and engaging BDO China Shu Lun Pan Certified Public Accountants LLP as the
company’s 2015 annual audit agency, of which the audit fees for financial and internal control audit is RMB 1.5
million. The Audit Committee agreed to submit the Proposal to the board of directors for deliberation.
3. On April 10, 2016, the audit committee of the board of directors reviewed the audit report 2015 issued by BDO
China Shu Lun Pan Certified Public Accountants LLP . The audit committee agreed on the audit, agreed to submit
the financial audit report to the board of directors for deliberation; meanwhile, to ensure the consistency of audit
work, the audit committee suggested that the board of directors continue to appoint audit report 2015 issued by
Shu Lun Pan Certified Public Accountants LLP as the audit institution for the year 2016.
4. On April 28, 2016, the Audit Committee of the board of directors deliberated the company’s First quarter 2016
financial accounting statements, and issued the following deliberations: the First quarter 2016 financial accounting
statements compiled by the company basically reflected the situation of the company’s assets and the operation
results, and the Audit Committee of the board of directors agreed to submit the financial accounting statements to
the board of directors for deliberation.
5. On August 25, 2016, the Audit Committee of the board of directors deliberated the company’s Semi –annual
90
Sino Great Wall Co., Ltd. 2016 Annual Report
Report 2016 financial accounting statements, and issued the following deliberations: the semi-annual report 2016
financial accounting statements compiled by the company basically reflected the situation of the company’s assets
and the operation results, and the Audit Committee of the board of directors agreed to submit the financial
accounting statements to the board of directors for deliberation.
6. On October 24, 2016, the Audit Committee of the board of directors deliberated the company’s third quarter
2016 financial accounting statements, and issued the following deliberations: the Third quarter 2016 financial
accounting statements compiled by the company basically reflected the situation of the company’s assets and the
operation results, and the Audit Committee of the board of directors agreed to submit the financial accounting
statements to the board of directors for deliberation.
The information about the duty performance of the remuneration and appraisal committee of the board of directors
in year 2016:
1. On April 10, 2016, according to the provisions stipulated by Rules of Procedure for the Special Committee of
the Board, the remuneration and appraisal committee of the board had deliberated the remunerations of the
company’s directors, supervisors and senior management personnel of year 2015 and reckoned that remunerations
paid to the company’s directors, supervisors and senior management personnel were fair, reasonable and
conforming to the relevant company’s the remuneration policy and the appraisal standard, then agreed to
submitted the item to the board of directors for deliberation.
Job performance condition of strategic committee of the board of directors in the year of 2016:
1. On March 14, 2016, the Strategic Committee of the Board of Directors considered the proposal of the plan to
establish a wholly-owned subsidiary by investment of the company and the wholly-owned subsidiary Sino
International and released the deliberations: the proposal was in line with the long-term development strategic
planning of the company and would lay a good foundation for the company’s future development. Thus, the
Strategic Committee agreed to submit the proposal to the Board of Directors for consideration.
2.On July 7, 2016, the Strategic Committee of the Board of Directors deliberated the plan to raise funds by means
of non-public issuing of shares in order to complement the circulating funds and repay the bank loans, considered
the proposal was in line with the development strategy of the company and agreed to submit to the Board of
Directors the Proposal on the Scheme of non-public Issuing of A-Share to Specific Objects, Proposal on the Plan
of non-public Issuing of Shares by Sino Great Wall Co., Ltd and other relevant proposals for deliberation.
VII. Work of the supervisory Committee
Did the supervisory Committee find any risk existing in performing the supervision activities in the reporting
period
□Yes √No
The supervisory Committee has no objection aginst any matters under supervision in the reporting period
VIII. Assessment and incentive Mechanism for Senior executives
The company established the evaluation system based on the targeted responsibility system, and adopted signing
the annual responsibility appraisal agreement for the evaluation of the company’s senior management personnel
which specified the KPI and evaluation method with methods related to the evaluation results. During the
reporting period, the company’s had conformed to the measures of the targeted responsibility system to assess and
evaluate the senior management personnel performances, which presented in the annual performance.
IX. Internal control situations
1. Specific situations on major defects of internal control discovered during report period
□ Yes √ No
2. Self-evaluation report on internal control
Disclosure date of appraisal report on
April 28,2017
internal control
Disclosure index of appraisal report on Juchao Website:（http://www.cninfo.com.cn）, Selfevaluation report of internal control
91
Sino Great Wall Co., Ltd. 2016 Annual Report
internal control in 2016 on April 28,2017.
Proportion of total unit assets covered by
appraisal in the total assets of the
100.00%
consolidated financial statements of the
company
Proportion of total unit incomes covered
by appraisal in the total business incomes
100.00%
of the consolidated financial statements of
the company
Standards of Defects Evaluation
Category Financial Report Non-financial Report
Material Defect:
1.Fraud of directors, supervisors and senior Material Defect:
management; 1.Violation of national laws or
2.Material errors appear in the Company’s regulations, normative documents and
financial report published; significant decision making lacking of
scientificity and system may lead to
3. The certified public auditor finds material
invalid system, no rectification for
wrong reporting in the current financial
material or major defect or other
statement, while the Company has not found
situations that materially affect
such reporting during its operation;4.The
audit committee and audit department of the the Company; 2.Violation of regulations
Company exercise invalid supervision upon led to punishment from government
internal control; department or regulatory authority.
Violation of management system or
5.The result of internal control assessment
internal control procedure led to major
hasn’t been rectified, especially the material
business disputes. Ranges of material
or major defects;
litigation led to great losses;3.The
Standard 6.Important business is lack of system working initiatives of staffs was
control or the system loses its validity. damaged at a great level, and the
Major Defects:1.No recognized accounting working efficiency was substantially
standards were followed when choosing and decreased, which exerted major adverse
applying the accounting policies;. effects on the culture and cohesion of the
2.No anti-fraud program and control enterprise,and led to serious turnover of
measures were established; 3.No core teams;4.Negative news spreads in
corresponding control mechanism was the whole business scope( including the
established or implemented for treating the extension to industry chain ), or is
abnormal or special accounting, and it is lack concerned by national medias or public
of compensating control;4.One or more ones, which will substantially damage
frauds appeared during the financial report the enterprise’s reputation, and the
process, and which couldn’t reasonably negative effects can’t be eliminated all
guarantee that the formulated financial report the time;5.The Company involved
would reach the goals of being actual and punishment from CSRC and involved
accurate.General Defect: Other defects warnings from stock exchange.
besides material defect and major defect.
(1) Material Defect: amount with wrong
reporting ≧ 10% of total profit amount;
amount with wrong reporting ≧ 10% of Material Defect: Due to the internal
operating income; amount with wrong control defect of non-financial report, it
reporting≧ 10% of total asset; amount with may exert impacts of over RMB 10
wrong reporting≧10% of net assets;(2) million(including RMB10 million ) on
Major Defect: 5% of total profit amount≦ the total profit amount.Major Defect:
Due to the internal control defect of
amount with wrong reporting﹤10% of total
non-financial report, it may exert impacts
profit amount; 5% of operating income≦ of over RMB 5 million (including 5
Standards of Quantitation
amount with wrong reporting﹤10% of million but less than 10 million) on the
operating income ;5% of total asset≦amount total profit amount.
with wrong reporting﹤10% of total General Defect:Due to the internal
asset;5% of net assets ≦amount with wrong control defect of non-financial report, it
reporting﹤10% of net assets;(3) General may exert impacts of below RMB 5
Defect: amount with wrong reporting﹤5% million.
of operating income. amount with wrong﹤
5% of total asset; amount with wrong
reporting﹤5% of net assets.
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Sino Great Wall Co., Ltd. 2016 Annual Report
Number of major defects in financial
0
reporting（a）
Number of major defects in non financial
0
reporting (a)
Number of important defects in financial
0
reporting（a）
Number of important defects in non
financial reporting（a）
X. Internal Control audit report
√ Applicable □Not applicable
Review opinions in the internal control audit report
We believe that, Sino Great Wall Co., Ltd. maintained efficient internal control of financial reports in all significant aspects
according to “ Basic Standards of Corporate Internal Control” and relevant regulations on December 31, 2016.
Disclosure date of audit report
Disclosure
of internal control (full-text)
Index of audit report of
April 28,2017
internal control (full-text)
Internal audit report’s opinion Juchao Website: （http://www.cninfo.com.cn）;2016 Audit report of internal control
Type of audit report on internal
Unqualified auditor’s report
control
Whether there is significant
No
defectin non-financial report
Has the CPAs issued a qualified auditor’s report of internal control .
□ Yes √No
Does the internal control audit report issued by the CPAs agree with the self-assessment report of the Board of
Directors
√Yes □No
93
Sino Great Wall Co., Ltd. 2016 Annual Report
X. Corporate Bond
Whether the company has corporate bonds that have been publicly issued and listed on the stock exchange, and
not yet due or due butnot folly cashed on the approval date of annual report
No
94
Sino Great Wall Co., Ltd. 2016 Annual Report
XI. Financial Report
I. Audit report
95
AUDITORS' REPORT
PCPAR [2017] No. ZB11076
To all shareholders of Sino Great Wall Co., Ltd.:
We have audited the attached financial statements of Sino Great Wall Co., Ltd. (hereinafter
referred to as “the Company”), which comprise the consolidated balance sheet and the
company's balance sheet as at December 31, 2016, the consolidated income statement and the
company's income statement, the consolidated statement of cash flows and the company's
statement of cash flows, the consolidated statement of changes in shareholders’ equity and the
company's statement of changes in shareholders' equity and notes to the financial statements for
the year then ended.
I. Management's Responsibility for the Financial Statements
Preparation and fair presentation of financial statements is the responsibility of the
company management. This responsibility includes: (1) preparing the financial
statements in accordance with Accounting Standards for Business Enterprises to achieve
fair presentation of the financial statements; (2) designing, implementing and
maintaining internal control that is necessary to enable the financial statements that are
free from material misstatement, whether due to fraud or error.
II. Auditor's Responsibilities
Our responsibility is to express an opinion on these financial statements based on our
audit. We conducted our audit in accordance with Auditing Standards for Certified Public
Accountants in China. Those standards require that we comply with professional and
ethical requirements of Chinese certified public accountants, and plan and perform the
audit to obtain reasonable assurance whether the financial statements are free from
material misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor’s
judgments, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, we consider
the internal control relevant to the preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the internal
control. An audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by the management, as well as
evaluating the overall presentation of the financial statements.
Auditors' Report Page 1
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
III. Opinion
In our opinion, the financial statements of the Company are prepared in accordance with
Accounting Standards for Business Enterprises and present fairly, in all material respects,
the consolidated financial position and the Company's financial position as at December
31, 2016 and the consolidated operating results and the Company's operating results and
cash flows for the year then ended.
BDO CHINA Shu Lun Pan Certified Public Accountant of China:
Certified Public Accountants LLP
Certified Public Accountant of China:
Shanghai, China April 26, 2017
This auditors’ report and the accompanying notes to the financial statements are English translation of the Chinese
auditors’ report. In case of doubt as to the presentation of these documents, the Chinese version shall prevail.
Auditors' Report Page 2
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并资产负债表 Consolidated Balance Sheet
2016 年 12 月 31 日 December 31, 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
期末余额Balance as at 年初余额 Balance as at
资 产 Assets 附注五 Note 5
December 31, 2016 January 1, 2016
流动资产： Current assets:
货币资金 Monetary funds （一） 5.1 1,340,815,821.83 695,384,561.31
结算备付金 Balances with clearing companies
拆出资金 Loans to banks and other financial institutions
以公允价值计量且其变动计入当期损益的金融资产 Financial assets measured at fair value through
（二）5.2 1,102,961.04
current profit or loss
衍生金融资产 Derivative financial assets
应收票据 Notes receivable （三） 5.3 1,074,390,642.58 220,448,747.94
应收账款 Accounts receivable （四） 5.4 3,725,170,208.31 2,352,808,087.33
预付款项 Advances to suppliers （五） 5.5 319,206,798.63 77,707,568.38
应收保费 Premium receivable
应收分保账款 Reinsurance accounts receivable
应收分保合同准备金 Reinsurance contract reserves receivable
应收利息 Interest receivable
应收股利 Dividends receivable
其他应收款 Other receivables （六） 5.6 651,012,132.91 239,952,886.11
买入返售金融资产 Financial assets purchased under resale agreements
存货 Inventories （七） 5.7 332,904,930.36 168,133,668.91
划分为持有待售的资产 Assets classified as held for sale
一年内到期的非流动资产 Non-current assets maturing within one year （八） 5.8 13,462,942.89 15,717,270.60
其他流动资产 Other current assets （九） 5.9 35,450,194.47 14,138,411.87
流动资产合计 TOTAL CURRENT ASSETS 7,492,413,671.98 3,785,394,163.49
非流动资产： Non-current assets:
发放贷款及垫款 Disbursement of advances and loans
可供出售金融资产 Available-for-sale financial assets
持有至到期投资 Held-to-maturity investments
长期应收款 Long-term receivables
长期股权投资 Long-term equity investments
投资性房地产 Investment property
固定资产 Fixed assets （十） 5.10 128,483,747.74 43,846,215.63
在建工程 Construction in process （十一） 5.11 10,016,928.24
工程物资 Project materials
固定资产清理 Liquidation of fixed assets
生产性生物资产 Productive biological assets
油气资产 Oil and gas assets
无形资产 Intangible assets （十二） 5.12 106,203,443.55 9,267,746.33
开发支出 Development expenses
商誉 Goodwill （十三） 5.13 58,874,144.79 6,724,316.91
长期待摊费用 Long-term deferred expenses （十四） 5.14 7,003,035.94 18,909,785.69
递延所得税资产 Deferred income tax assets （十五） 5.15 76,298,659.34 47,950,278.07
其他非流动资产 Other non-current assets （十六） 5.16 116,902,258.30 95,353,390.28
非流动资产合计 TOTAL NON-CURRENT ASSETS 493,765,289.66 232,068,661.15
资产总计 TOTAL ASSETS 7,986,178,961.63 4,017,462,824.63
后附财务报表附注为财务报表的组成部分。 The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 1
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并资产负债表（续）Consolidated Balance Sheet (Continued)
2016 年 12 月 31 日 December 31, 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
期末余额Balance as at 年初余额 Balance as at
负债和所有者权益 Liability and Owners' Equity 附注五 Note 5
December 31, 2016 January 1, 2016
流动负债： Current liabilities:
短期借款 Short-term borrowings （十七） 5.17 1,966,058,357.59 225,408,496.07
向中央银行借款 Borrowings from central bank
吸收存款及同业存放 Absorption of deposits and interbank deposit
拆入资金 Loans from banks and other financial institutions
以公允价值计量且其变动计入当期损益的金融负债 Financial liabilities measured at fair value through current profit or loss
衍生金融负债 Derivative financial liabilities
应付票据 Notes payable （十八）5.18 706,883,375.54 143,410,167.17
应付账款 Accounts payable （十九）5.19 1,313,948,990.25 1,332,619,954.77
预收款项 Advances from customers （二十） 5.20 573,784,072.58 64,963,842.60
卖出回购金融资产款 Financial assets sold under repurchase agreements
应付手续费及佣金 Handling charges and commissions payable
应付职工薪酬 Employee compensation payable （二十一） 5.21 18,797,546.69 12,669,619.20
应交税费 Taxes and surcharges payable （二十二） 5.22 313,483,669.78 284,826,290.11
应付利息 Interest payable （二十三） 5.23 6,428,493.55 527,969.26
应付股利 Dividends payable
其他应付款 Other payables （二十四）5.24 222,414,975.01 635,200,976.60
应付分保账款 Reinsurance accounts payable
保险合同准备金 Reserves for insurance contracts
代理买卖证券款 Receivings from vicariously traded securities
代理承销证券款 Receivings from vicariously sold securities
划分为持有待售的负债 Liabilities classified as held for sale
一年内到期的非流动负债 Non-current liabilities maturing within one year （二十五）5.25 175,958,998.04 7,135,752.00
其他流动负债 Other current liabilities （二十六）5.26 30,382,980.72
流动负债合计 TOTAL CURRENT LIABILITIES 5,328,141,459.75 2,706,763,067.78
非流动负债： Non-current liabilities:
长期借款 Long-term borrowings （二十七） 5.27 786,858,878.82 30,140,649.14
应付债券 Bonds payable
其中：优先股 Including: Preferred stock
永续债 Perpetual debts
长期应付款 Long-term payables
长期应付职工薪酬 Long-term employee compensation payable
专项应付款 Special payables
预计负债 Estimated liabilities （二十八）5.28 13,225,861.70
递延收益 Deferred income
递延所得税负债 Deferred income tax liabilities （十五） 5.15 27,469,888.77 15,444.16
其他非流动负债 Other non-current liabilities
非流动负债合计 TOTAL NON-CURRENT LIABILITIES 827,554,629.29 30,156,093.30
负债合计 TOTAL LIABILITIES 6,155,696,089.04 2,736,919,161.08
所有者权益： Total owners' equity:
实收资本（或股本） Paid-in capital (or share capital) （二十九） 5.29 1,698,245,011.00 446,906,582.00
其他权益工具 Other equity instruments
其中：优先股 Including: Preferred stock
永续债 Perpetual debts
资本公积 Capital reserve （三十） 5.30 -1,299,349,701.74 -50,367,862.22
减：库存股 Less: Treasury stock
其他综合收益 Other comprehensive income
专项储备 Special reserve （三十一）5.31 65,687,868.14 46,014,941.54
盈余公积 Surplus reserve （三十二） 5.32 84,394,441.23 84,394,441.23
一般风险准备 General risk reserves
未分配利润 Undistributed profits （三十三） 5.33 1,228,970,498.86 755,308,636.19
归属于母公司所有者权益合计 Total equity attributable to owners of the parent company 1,777,948,117.49 1,282,256,738.74
少数股东权益 Minority equity 52,534,755.10 -1,713,075.19
所有者权益合计 TOTAL OWNERS' EQUITY 1,830,482,872.59 1,280,543,663.55
负债和所有者权益总计 TOTAL LIABILITIES AND OWNERS' EQUITY 7,986,178,961.63 4,017,462,824.63
后附财务报表附注为财务报表的组成部分。 The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 2
神州长城股份有限公司 Sino Great Wall Co., Ltd.
资产负债表 Balance Sheet
2016 年 12 月 31 日 December 31, 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
期末余额Balance as at 年初余额 Balance as at
资 产 Assets 附注十五 Note 15
December 31, 2016 January 1, 2016
流动资产：Current assets:
货币资金 Monetary funds 168,691,344.34 239,145,251.31
以公允价值计量且其变动计入当期 损益的金融资产 Financial assets measured at
fair value through current profit or loss
衍生金融资产 Derivative financial assets
应收票据 Notes receivable
应收账款 Accounts receivable （一） 15.1 6,346.00 29,083.30
预付款项 Advances to suppliers 1,000,000.00
应收利息 Interest receivable
应收股利 Dividends receivable
其他应收款 Other receivables （二）15.2 1,672,200,041.98
存货 Inventories
划分为持有待售的资产 Assets classified as held for sale
一年内到期的非流动资产 Non-current assets maturing within one year
其他流动资产 Other current assets 1,404,744.25
流动资产合计 TOTAL CURRENT ASSETS 1,843,302,476.57 239,174,334.61
非流动资产： Non-current assets:
可供出售金融资产 Available-for-sale financial assets
持有至到期投资 Held-to-maturity investments
长期应收款 Long-term receivables
长期股权投资 Long-term equity investments （三） 15.3 3,176,451,536.66 3,079,451,536.66
投资性房地产 Investment property
固定资产 Fixed assets 4,121.50
在建工程 Construction in process
工程物资 Project materials
固定资产清理 Liquidation of fixed assets
生产性生物资产 Productive biological assets
油气资产 Oil and gas assets
无形资产 Intangible assets
开发支出 Development expenses
商誉 Goodwill
长期待摊费用 Long-term deferred expenses 336,569.60
递延所得税资产 Deferred income tax assets 382.68
其他非流动资产 Other non-current assets 48,960,000.00
非流动资产合计 TOTAL NON-CURRENT ASSETS 3,225,752,227.76 3,079,451,919.34
资产总计 TOTAL ASSETS 5,069,054,704.33 3,318,626,253.95
后附财务报表附注为财务报表的组成部分。 The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 3
神州长城股份有限公司 Sino Great Wall Co., Ltd.
资产负债表（续）Balance Sheet (Continued)
2016 年 12 月 31 日 December 31, 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
期末余额Balance as at 年初余额 Balance as at
负债和所有者权益 Liability and Owners' Equity
December 31, 2016 January 1, 2016
流动负债： Current liabilities:
短期借款 Short-term borrowings 980,000,000.00
以公允价值计量且其变动计入当期损益的金融负债 Financial liabilities measured at
fair value through current profit or loss
衍生金融负债 Derivative financial liabilities
应付票据 Notes payable 68,000,000.00
应付账款 Accounts payable
预收款项 Advances from customers
应付职工薪酬 Employee compensation payable 701,792.11
应交税费 Taxes and surcharges payable 97,085,106.00 98,150,372.30
应付利息 Interest payable 5,150,639.24
应付股利 Dividends payable
其他应付款 Other payables 13,252,762.06 803,339.56
划分为持有待售的负债 Liabilities classified as held for sale
一年内到期的非流动负债 Non-current liabilities maturing within one year
其他流动负债 Other current liabilities
流动负债合计 TOTAL CURRENT LIABILITIES 1,164,190,299.41 98,953,711.86
非流动负债： Non-current liabilities:
长期借款 Long-term borrowings 700,000,000.00
应付债券 Bonds payable
其中：优先股 Including: Preferred stock
永续债 Perpetual debts
长期应付款 Long-term payables
长期应付职工薪酬 Long-term employee compensation payable
专项应付款 Special payables
预计负债 Estimated liabilities
递延收益 Deferred income
递延所得税负债 Deferred income tax liabilities
其他非流动负债 Other non-current liabilities
非流动负债合计 TOTAL NON-CURRENT LIABILITIES 700,000,000.00
负债合计 TOTAL LIABILITIES 1,864,190,299.41 98,953,711.86
所有者权益： Total owners' equity:
实收资本（或股本） Paid-in capital (or share capital) 1,698,245,011.00 446,906,582.00
其他权益工具 Other equity instruments
其中：优先股 Including: Preferred stock
永续债 Perpetual debts
资本公积 Capital reserve 1,237,956,472.37 2,489,294,901.37
减：库存股 Less: Treasury stock
其他综合收益 Other comprehensive income
专项储备 Special reserve
盈余公积 Surplus reserve 26,309,287.00 26,309,287.00
未分配利润 Undistributed profits 242,353,634.55 257,161,771.72
所有者权益合计 TOTAL OWNERS' EQUITY 3,204,864,404.92 3,219,672,542.09
负债和所有者权益总计 TOTAL LIABILITIES AND OWNERS' EQUITY 5,069,054,704.33 3,318,626,253.95
后附财务报表附注为财务报表的组成部分。 The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 4
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并利润表 Consolidated Income Statement
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
项 目 Item 附注五 Note 5 本期发生额 Year 2016 上期发生额 Year 2015
一、营业总收入 Total operating income 4,664,999,117.17 4,010,358,999.58
其中：营业收入Including: Operating income （三十四）5.34 4,664,999,117.17 4,010,358,999.58
利息收入 Interest income
已赚保费 Earned premiums
手续费及佣金收入 Income from handling charges and commissions
二、营业总成本 Total operating cost 4,110,727,814.01 3,578,964,860.85
其中：营业成本 Including: Operating cost （三十四）5.34 3,459,377,744.66 3,165,027,185.66
利息支出 Interest expenses
手续费及佣金支出 Handling charges and commissions expenses
退保金 Surrender value
赔付支出净额 Net claims paid
提取保险合同准备金净额 Net amount withdrawn for insurance contract reserves
保单红利支出 Policy dividend payment
分保费用 Reinsurance costs
税金及附加 Taxes and surcharges （三十五）5.35 9,651,529.46 79,485,669.04
销售费用 Selling expenses （三十六）5.36 30,318,688.27 13,686,172.10
管理费用 General and administrative expenses （三十七） 5.37 313,930,733.56 154,562,327.86
财务费用 Financial expenses （三十八）5.38 127,437,227.95 54,866,402.02
资产减值损失 Losses from assets impairment （三十九） 5.39 170,011,890.11 111,337,104.17
加：公允价值变动收益（损失以“-”号填列） Plus: Gains from the changes in fair value ("-" for losses) （四十） 5.40 42,553.26
投资收益（损失以“-”号填列） Investment income ("-" for losses) （四十一） 5.41 2,226,350.97
其中：对联营企业和合营企业的投资收益 Including: Income from investment in associates and joint ventures
汇兑收益（损失以“-”号填列） Gains from foreign exchange ("-" for losses)
三、营业利润（亏损以“-”号填列）Operating profits ("-" for losses) 556,497,654.12 431,436,691.98
加：营业外收入 Plus: Non-operating income （四十二） 5.42 26,427,042.86 380,733.08
其中：非流动资产处置利得 Including: Gains from disposal of non-current assets 4,455.00
减： 营业外支出 Less: Non-operating expenses （四十三） 5.43 21,586,940.28 1,025,395.57
其中：非流动资产处置损失 Including: Losses from disposal of non-current assets 564,833.40 85,567.15
四、利润总额（亏损总额以“-”号填列） Total profits ("-" for total losses) 561,337,756.70 430,792,029.49
减：所得税费用 Less: Income tax expenses （四十四） 5.44 89,244,861.75 84,688,888.81
五、净利润（净亏损以“-”号填列） Net profit ("-" for net losses) 472,092,894.95 346,103,140.68
其中：被合并方在合并前实现的净利润 Including: Net profit achieved by the combined party before the combination
归属于母公司所有者的净利润 Net profit attributable to owners of the parent company 473,661,862.67 346,648,651.48
少数股东损益 Minority interest income -1,568,967.72 -545,510.80
六、其他综合收益的税后净额 Other comprehensive income, net of tax 85.60
归属母公司所有者的其他综合收益的税后净额 Other comprehensive income, net of tax attributable to owners of the parent company 85.60
（一）以后不能重分类进损益的其他综合收益 Other comprehensive income that cannot be reclassified into profit or loss later
1. 重新计量设定受益计划净负债或净资产的变动 Changes arising from the re-measurement of net liabilities or net assets of defined benefit
plan
2. 权益法下在被投资单位不能重分类进损益的其他综合收益中享有的份额 Share in other comprehensive income of the investee that
cannot be reclassified into profit or loss under the equity method
（二）以后将重分类进损益的其他综合收益 Other comprehensive income that will be reclassified into profit or loss later 85.60
1. 权益法下在被投资单位以后将重分类进损益的其他综合收益中享有的份额 Share in other comprehensive income of the investee that will
be reclassified into profit or loss under the equity method later
2. 可供出售金融资产公允价值变动损益 Profit or loss of change in faire value of available-for-sale financial assets
3. 持有至到期投资重分类为可供出售金融资产损益 Profit or loss arising from reclassification of held-to-maturity investments as financial
assets available for sale
4. 现金流量套期损益的有效部分 Effective portion of profit or loss from cash flow hedging
5. 外币财务报表折算差额 Translation differences of foreign currency financial statements 85.60
6. 其他 Others
归属于少数股东的其他综合收益的税后净额 Other comprehensive income, net of tax attributable to minority shareholders
七、综合收益总额 Total comprehensive income 472,092,894.95 346,103,226.28
归属于母公司所有者的综合收益总额 Total comprehensive income attributable to owners of the parent company 473,661,862.67 346,648,737.08
归属于少数股东的综合收益总额 Total comprehensive income attributable to minority shareholders -1,568,967.72 -545,510.80
八、每股收益： Earnings per share:
（一）基本每股收益（元/股）Basic earnings per share (RMB/share) 0.28 0.40
（二）稀释每股收益（元/股）Diluted earnings per share (RMB/share) 0.28 0.40
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 5
神州长城股份有限公司 Sino Great Wall Co., Ltd.
利润表 Income Statement
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
项 目 Item 附注十五 Note 15 本期发生额 Year 2016 上期发生额 Year 2015
一、营业收入 Operating income （五） 15.5 238,048.64 2,318,061.00
减：营业成本 Less: Operating costs （五） 15.5 237,620.18
税金及附加 Taxes and surcharges 192,135.56 153,652.28
销售费用 Selling expenses
管理费用 General and administrative expenses 34,816,749.95 8,954,347.86
财务费用（收益以“-”号填列） Financial expenses (“-” for income) 5,966,974.50 3,370,704.26
资产减值损失 Losses from assets impairment 781,524.61 -13,038.09
加：公允价值变动净收益（损失以“-”号填列） Plus: Net gains from the changes in
-
fair value ("-" for losses)
投资收益（损失以“-”号填列） Investment income ("-" for losses) （四） 15.4 396,197.49 383,969,705.11
其中:对联营和合营企业的投资收益 Including: Income from investment in associates
-
and joint ventures
二、营业利润（亏损以“-”号填列） Operating profits ("-" for losses) -41,123,138.49 373,584,479.62
加：营业外收入 Plus: Non-operating income 26,315,384.00 73,450,480.94
其中：非流动资产处置利得 Including: Gains from disposal of non-current assets
减： 营业外支出 Less: Non-operating expenses
其中：非流动资产处置损失 Including: Losses from disposal of non-current assets
三、利润总额（亏损总额以“-”号填列） Total profits ("-" for total losses) -14,807,754.49 447,034,960.56
减：所得税费用 Less: Income tax expenses 382.68 93,708,631.85
四、净利润（净亏损以“-”号填列） Net profit ("-" for net losses) -14,808,137.17 353,326,328.72
五、其他综合收益的税后净额 Other comprehensive income, net of tax 4,398,234.00
（一）以后不能重分类进损益的其他综合收益 Other comprehensive income that
cannot be reclassified into profit or loss later
1. 重新计量设定受益计划净负债或净资产的变动 Changes arising from the re-
measurement of net liabilities or net assets of defined benefit plan
2. 权益法下在被投资单位不能重分类进损益的其他综合收益中享有的份额 Share in
other comprehensive income of the investee that cannot be reclassified into profit or loss
under the equity method
（二）以后将重分类进损益的其他综合收益 Other comprehensive income that will be
4,398,234.00
reclassified into profit or loss later
1. 权益法下在被投资单位以后将重分类进损益的其他综合收益中享有的份额 Share
in other comprehensive income of the investee that will be reclassified into profit or loss
under the equity method later
2. 可供出售金融资产公允价值变动损益 Profit or loss of change in faire value of
available-for-sale financial assets
3. 持有至到期投资重分类为可供出售金融资产损益 Profit or loss arising from
reclassification of held-to-maturity investments as financial assets available for sale
4. 现金流量套期损益的有效部分 Effective portion of profit or loss from cash flow
hedging
5. 外币财务报表折算差额 Translation differences of foreign currency financial
4,398,234.00
statements
6. 其他 Others
六、综合收益总额 Total comprehensive income -14,808,137.17 357,724,562.72
七、每股收益： Earnings per share:
（一）基本每股收益（元/股）Basic earnings per share (RMB/share) -0.01 0.17
（二）稀释每股收益（元/股）Diluted earnings per share (RMB/share) -0.01 0.17
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 6
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并现金流量表 Consolidated Statement of Cash Flows
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
项 目 Item 附注五 Note 5 本期发生额 Year 2016 上期发生额 Year 2015
一、经营活动产生的现金流量 CASH FLOWS FROM OPERATING ACTIVITIES
销售商品、提供劳务收到的现金 Cash received from sales of goods and rendering of services 2,793,118,697.02 2,882,512,458.95
客户存款和同业存放款项净增加额 Net increase in deposits from customers and due from banks and other financial
institutions
向中央银行借款净增加额 Net increase in borrowings from the central bank
向其他金融机构拆入资金净增加额 Net increase in loans from other financial institutions
收到原保险合同保费取得的现金 Cash received from receiving insurance premium of original insurance contract
收到再保险业务现金净额 Net cash received from reinsurance business
保户储金及投资款净增加额 Net increase in deposits and investments from policyholders
处置以公允价值计量且其变动计入当期损益的金融资产净增加额 Net increase received from disposal of financial assets
measured at fair value through current profit and loss
收取利息、手续费及佣金的现金 Cash received from interests, handling charges and commissions
拆入资金净增加额 Net increase in loans from banks and other financial institutions
回购业务资金净增加额 Net capital increase in repurchase business
收到的税费返还 Refunds of taxes and surcharges 6,342,293.39 250,556.49
收到其他与经营活动有关的现金 Cash received from other operating activities （四十五）5.45 1,818,662,633.63 1,374,677,443.26
经营活动现金流入小计 Sub-total of cash inflows from operating activities 4,618,123,624.04 4,257,440,458.70
购买商品、接受劳务支付的现金 Cash paid for goods purchased and services received 2,879,469,436.78 2,566,176,221.01
客户贷款及垫款净增加额 Net increase in customers' loans and advances
存放中央银行和同业款项净增加额 Net increase in deposits with central bank and with banks and other financial
institutions
支付原保险合同赔付款项的现金 Cash paid for original insurance contract claims
支付利息、手续费及佣金的现金 Cash paid for interests, handling charges and commissions
支付保单红利的现金 Cash paid for policy dividends
支付给职工以及为职工支付的现金 Cash payments to and on behalf of employees 345,233,924.96 194,602,987.57
支付的各项税费 Cash paid for taxes and surcharges 92,009,656.66 150,781,903.84
支付其他与经营活动有关的现金 Cash paid for other operating activities （四十五）5.45 2,989,286,419.58 1,637,930,603.36
经营活动现金流出小计 Sub-total of cash outflows from operating activities 6,305,999,437.98 4,549,491,715.78
经营活动产生的现金流量净额 NET CASH FLOWS FROM OPERATING ACTIVITIES -1,687,875,813.94 -292,051,257.08
二、投资活动产生的现金流量 CASH FLOWS FROM INVESTING ACTIVITIES
收回投资收到的现金 Cash received from disposal of investments 119,902,961.04 68.86
取得投资收益所收到的现金 Cash received from returns on investments 1,566,217.08 2,426.00
处置固定资产、无形资产和其他长期资产收回的现金净额 Net cash received from disposal of fixed assets, intangible
95,937.00
assets and other long-term assets
处置子公司及其他营业单位收到的现金净额 Net cash received from disposal of subsidiaries and other business units
收到其他与投资活动有关的现金 Cash received from other investing activities
投资活动现金流入小计 Sub-total of cash inflows from investment activities 121,565,115.12 2,494.86
购建固定资产、无形资产和其他长期资产支付的现金净额 Net cash paid for purchase and construction of fixed assets,
15,582,049.03 25,179,343.19
intangible assets and other long-term assets
投资支付的现金 Cash paid for investments 188,307,635.00
质押贷款净增加额 Net increase in pledge loans
取得子公司及其他营业单位支付的现金净额 Net cash paid to acquire subsidiaries and other business units 42,467,736.61 3,533,792.47
支付其他与投资活动有关的现金 Cash paid for other investing activities
投资活动现金流出小计 Sub-total of cash outflows from investing activities 246,357,420.64 28,713,135.66
投资活动产生的现金流量净额 NET CASH FLOWS FROM INVESTING ACTIVITIES -124,792,305.52 -28,710,640.80
三、筹资活动产生的现金流量 CASH FLOWS FROM FINANCING ACTIVITIES
吸收投资收到的现金 Cash received from absorption of investment 242,223,784.52
其中：子公司吸收少数股东投资收到的现金 Including: Cash received by subsidiaries from investments by minority
shareholders
取得借款收到的现金 Cash received from borrowings 3,352,564,898.49 783,614,556.72
发行债券收到的现金 Cash received from bonds issue
收到其他与筹资活动有关的现金 Cash received from other financing activities （四十五）5.45 175,355,000.00 779,900,000.00
筹资活动现金流入小计 Sub-total of cash inflows from financing activities 3,527,919,898.49 1,805,738,341.24
偿还债务支付的现金 Cash paid for debts repayments 676,386,220.35 737,683,498.86
分配股利、利润或偿付利息支付的现金 Cash paid for distribution of dividends and profits or payment of interests 116,576,063.38 33,711,743.66
其中：子公司支付给少数股东的股利、利润 Including: Dividends and profits paid to minority shareholders by
subsidiaries
支付其他与筹资活动有关的现金 Cash paid for other financing activities （四十五）5.45 555,780,295.84 375,281,700.88
筹资活动现金流出小计 Sub-total of cash outflows from financing activities 1,348,742,579.57 1,146,676,943.40
筹资活动产生的现金流量净额 NET CASH FLOWS FROM FINANCING ACTIVITIES 2,179,177,318.92 659,061,397.84
四、汇率变动对现金及现金等价物的影响 EFFECT OF FLUCTUATION IN EXCHANGE RATE ON CASH AND
-5,549,633.86 686,301.95
CASH EQUIVALENTS
五、现金及现金等价物净增加额 NET INCREASE IN CASH AND CASH EQUIVALENTS 360,959,565.60 338,985,801.91
加：期初现金及现金等价物余额 Plus: Beginning balance of cash and cash equivalents 582,745,756.81 243,759,954.90
六、期末现金及现金等价物余额 ENDING BALANCE OF CASH AND CASH EQUIVALENTS 943,705,322.41 582,745,756.81
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department:
Financial statements Page 7
神州长城股份有限公司 Sino Great Wall Co., Ltd.
现金流量表 Statement of Cash Flows
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
项 目 Item 本期发生额 Year 2016 上期发生额 Year 2015
一、经营活动产生的现金流量： CASH FLOWS FROM OPERATING ACTIVITIES:
销售商品、提供劳务收到的现金 Cash received from sales of goods and rendering of services 266,133.00 2,246,511.00
收到的税费返还 Refunds of taxes and surcharges
收到其他与经营活动有关的现金 Cash received from other operating activities 822,670,967.58 99,238,423.81
经营活动现金流入小计 Sub-total of cash inflows from operating activities 822,937,100.58 101,484,934.81
购买商品、接受劳务支付的现金 Cash paid for goods purchased and services received
支付给职工以及为职工支付的现金 Cash payments to and on behalf of employees 7,388,478.01 1,026,970.10
支付的各项税费 Cash paid for taxes and surcharges 1,558,123.56 14,621,408.55
支付其他与经营活动有关的现金 Cash paid for other operating activities 2,332,567,169.66 95,712,355.22
经营活动现金流出小计 Sub-total of cash outflows from operating activities 2,341,513,771.23 111,360,733.87
经营活动产生的现金流量净额 NET CASH FLOWS FROM OPERATING ACTIVITIES -1,518,576,670.65 -9,875,799.06
二、投资活动产生的现金流量：CASH FLOWS FROM INVESTING ACTIVITIES:
收回投资收到的现金 Cash received from disposal of investments 107,000,000.00
取得投资收益收到的现金 Cash received from returns on investments 396,197.49
处置固定资产、无形资产和其他长期资产收回的现金净额 Net cash received from disposal of fixed
assets, intangible assets and other long-term assets
处置子公司及其他营业单位收到的现金净额 Net cash received from disposal of subsidiaries and other
business units
收到其他与投资活动有关的现金 Cash received from other investing activities 40,084.65
投资活动现金流入小计 Sub-total of cash inflows from investment activities 107,396,197.49 40,084.65
购建固定资产、无形资产和其他长期资产支付的现金 Cash paid for purchase and construction of fixed
assets, intangible assets and other long-term assets
投资支付的现金 Cash paid for investments 155,960,000.00
取得子公司及其他营业单位支付的现金净额 Net cash paid to acquire subsidiaries and other business
97,000,000.00
units
支付其他与投资活动有关的现金 Cash paid for other investing activities
投资活动现金流出小计 Sub-total of cash outflows from investing activities 252,960,000.00
投资活动产生的现金流量净额 NET CASH FLOWS FROM INVESTING ACTIVITIES -145,563,802.51 40,084.65
三、筹资活动产生的现金流量： CASH FLOWS FROM FINANCING ACTIVITIES:
吸收投资收到的现金 Cash received from absorption of investment 240,499,988.72
取得借款收到的现金 Cash received from borrowings
发行债券收到的现金 Cash received from bonds issue 1,810,000,000.00
收到其他与筹资活动有关的现金 Cash received from other financing activities 12,500,000.00
筹资活动现金流入小计 Sub-total of cash inflows from financing activities 1,822,500,000.00 240,499,988.72
偿还债务支付的现金 Cash paid for debts repayments 130,000,000.00
分配股利、利润或偿付利息支付的现金 Cash paid for distribution of dividends and profits or payment
74,013,433.81
of interests
支付其他与筹资活动有关的现金 Cash paid for other financing activities 24,800,000.00
筹资活动现金流出小计 Sub-total of cash outflows from financing activities 228,813,433.81
筹资活动产生的现金流量净额 NET CASH FLOWS FROM FINANCING ACTIVITIES 1,593,686,566.19 240,499,988.72
四、汇率变动对现金及现金等价物的影响 EFFECT OF FLUCTUATION IN EXCHANGE RATE
ON CASH AND CASH EQUIVALENTS
五、现金及现金等价物净增加额 NET INCREASE IN CASH AND CASH EQUIVALENTS -70,453,906.97 230,664,274.31
加：期初现金及现金等价物余额 Plus: Beginning balance of cash and cash equivalents 239,145,251.31 8,480,977.00
六、期末现金及现金等价物余额 ENDING BALANCE OF CASH AND CASH EQUIVALENTS 168,691,344.34 239,145,251.31
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise:
主管会计工作负责人: Accounting Principal:
会计机构负责人: Head of the Accounting Department: Financial statements Page 8
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并所有者权益变动表 Consolidated Statement of Changes in Owners' Equity
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
本期发生额 Year 2016
归属于母公司所有者权益 Equity attributable to owners of the parent company
项 目 Item 其他权益工具 Other equity instruments 少数股东权益 所有者权益合计 Total
实收资本(或股本) 一般风险准备
资本公积 Capital 减:库存股 Less: 其他综合收益 Other 专项储备 Special 盈余公积 未分配利润 Undistributed Minority equity owners' equity
Paid-in capital (or share General risk
优先股 Preferred 永续债 Perpetual reserves Treasury stock comprehensive income reserves Surplus reserves profits
capital) 其他 Others reserves
stock debts
一、上年年末余额 Balance at the end of the last year 446,906,582.00 -50,367,862.22 46,014,941.54 84,394,441.23 755,308,636.19 -1,713,075.19 1,280,543,663.55
加：会计政策变更 Plus: Adjustments for changes in accounting
policies
前期差错更正 Correction of accounting errors in prior periods
同一控制下企业合并 Business combination under common
control
其他 Others
二、本年年初余额 Balance at the beginning of the year 446,906,582.00 -50,367,862.22 46,014,941.54 84,394,441.23 755,308,636.19 -1,713,075.19 1,280,543,663.55
三、本期增减变动金额（减少以“-”号填列）
1,251,338,429.00 -1,248,981,839.52 19,672,926.60 473,661,862.67 54,247,830.29 549,939,209.05
Increases/decreases in the current period (“-” for decreases)
（一）综合收益总额 Total comprehensive income 473,661,862.67 -1,327,357.60 472,334,505.07
（二）所有者投入和减少资本 Capital contributed or reduced
1,251,338,429.00 2,356,589.48 55,575,187.89 1,309,270,206.37
by owners
1．股东投入的普通股 Common shares contributed by
1,251,338,429.00 1,251,338,429.00
shareholders
2．其他权益工具持有者投入资本 Capital contributed by the
holders of other equity instruments
2．股份支付计入所有者权益的金额 Amounts of share-based
payments recognized in owners' equity
3．其他 Others 2,356,589.48 55,575,187.89 57,931,777.37
（三）利润分配 Profit distribution
1．提取盈余公积 Withdrawal of surplus reserves
2．提取一般风险准备 Withdrawal of general risk reserves
3．对所有者（或股东）的分配 Profits distributed to owners
(or shareholders)
4．其他 Others
（四）所有者权益内部结转 Internal carry-forward of owners'
-1,251,338,429.00 -1,251,338,429.00
equity
1．资本公积转增资本（或股本） Conversion of capital
-1,251,338,429.00 -1,251,338,429.00
reserves into paid-in capital (or share capital)
2．盈余公积转增资本（或股本） Conversion of surplus
reserves into paid-in capital (or share capital)
3．盈余公积弥补亏损 Surplus reserves offsetting losses
4．其他 Others
（五）专项储备 Special reserves 19,672,926.60 19,672,926.60
1．本期提取 Amount withdrawn in the current period 56,095,547.05 56,095,547.05
2．本期使用 Amount used in the current period 36,422,620.45 36,422,620.45
（六）其他 Others
四、本期期末余额 Balance at the end of the current period 1,698,245,011.00 -1,299,349,701.74 65,687,868.14 84,394,441.23 1,228,970,498.86 52,534,755.10 1,830,482,872.60
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise: 主管会计工作负责人: Accounting Principal: 会计机构负责人: Head of the Accounting Department:
Financial statements Page 9
神州长城股份有限公司 Sino Great Wall Co., Ltd.
合并所有者权益变动表（续） Consolidated Statement of Changes in Owners' Equity (Continued)
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
上期发生额 Year 2015
归属于母公司所有者权益 Equity attributable to owners of the parent company
项 目 Item 其他权益工具 Other equity instruments 其他综合收益 少数股东权益 所有者权益合计 Total
实收资本(或股本) 减:库存股 一般风险准
资本公积 Capital Other 专项储备 Special 盈余公积 Surplus 未分配利润 Minority equity owners' equity
Paid-in capital (or 优先股 永续债 Perpetual Less: Treasury 备 General
其他 Others reserves comprehensive reserves reserves Undistributed profits
share capital) Preferred stock debts stock risk reserves
income
一、上年年末余额 Balance at the end of the last year 70,136,099.00 176,467,549.00 -85.60 21,813,200.10 49,347,406.23 443,707,019.71 761,471,188.44
加：会计政策变更 Plus: Adjustments for changes in accounting policies
前期差错更正 Correction of accounting errors in prior periods
同一控制下企业合并 Business combination under common control
其他 Others
二、本年年初余额 Balance at the beginning of the year 70,136,099.00 176,467,549.00 -85.60 21,813,200.10 49,347,406.23 443,707,019.71 761,471,188.44
三、本期增减变动金额（减少以“-”号填列） Increases/decreases in the current
376,770,483.00 -226,835,411.22 85.60 24,201,741.44 35,047,035.00 311,601,616.48 -1,713,075.19 519,072,475.11
period (“-” for decreases)
（一）综合收益总额 Total comprehensive income 85.60 346,648,651.48 -545,510.80 346,103,226.28
（二）所有者投入和减少资本 Capital contributed or reduced by owners 25,914,633.00 226,661,441.01 252,576,074.01
1．股东投入的普通股 Common shares contributed by shareholders 25,914,633.00 217,585,355.72 243,499,988.72
2．其他权益工具持有者投入资本 Capital contributed by the holders of other
equity instruments
2．股份支付计入所有者权益的金额 Amounts of share-based payments recognized
in owners' equity
3．其他 Others 9,076,085.29 9,076,085.29
（三）利润分配 Profit distribution 35,047,035.00 -35,047,035.00 -1,167,564.39 -1,167,564.39
1．提取盈余公积 Withdrawal of surplus reserves 35,047,035.00 -35,047,035.00
2．提取一般风险准备 Withdrawal of general risk reserves
3．对所有者（或股东）的分配 Profits distributed to owners (or shareholders)
4．其他 Others -1,167,564.39 -1,167,564.39
（四）所有者权益内部结转 Internal carry-forward of owners' equity
1．资本公积转增资本（或股本） Conversion of capital reserves into paid-in
capital (or share capital)
2．盈余公积转增资本（或股本） Conversion of surplus reserves into paid-in
capital (or share capital)
3．盈余公积弥补亏损 Surplus reserves offsetting losses
4．其他 Others
（五）专项储备 Special reserves 24,201,741.44 24,201,741.44
1．本期提取 Amount withdrawn in the current period 34,558,557.84 34,558,557.84
2．本期使用 Amount used in the current period -10,356,816.40 -10,356,816.40
（六）其他 Others 350,855,850.00 -453,496,852.23 -102,641,002.23
四、本期期末余额 Balance at the end of the current period 446,906,582.00 -50,367,862.22 46,014,941.54 84,394,441.23 755,308,636.19 -1,713,075.19 1,280,543,663.55
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise: 主管会计工作负责人: Accounting Principal: 会计机构负责人: Head of the Accounting Department:
Financial statements Page 10
神州长城股份有限公司 Sino Great Wall Co., Ltd.
所有者权益变动表 Statement of Changes in Owners' Equity
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
本期发生额 Year 2016
其他权益工具 Other equity instruments
项 目 Item 减：库存股
实收资本（或股本）Paid- 资本公积 Capital 其他综合收益 Other 专项储备 盈余公积 Surplus 未分配利润 所有者权益合计 Total
Less: Treasury
in capital (or share capital) 优先股 Preferred 永续债 Perpetual 其他 reserves comprehensive income Special reserves reserves Undistributed profits owners' equity
stock debts Others stock
一、上年年末余额 Balance at the end of the last year 446,906,582.00 2,489,294,901.37 26,309,287.00 257,161,771.72 3,219,672,542.09
加：会计政策变更 Plus: Adjustments for changes in accounting policies
前期差错更正 Correction of accounting errors in prior periods
其他 Others
二、本年年初余额 Balance at the beginning of the year 446,906,582.00 2,489,294,901.37 26,309,287.00 257,161,771.72 3,219,672,542.09
三、本期增减变动金额（减少以“-”号填列） Increases/decreases in the
1,251,338,429.00 -1,251,338,429.00 -14,808,137.17 -14,808,137.17
current period (“-” for decreases)
（一）综合收益总额 Total comprehensive income -14,808,137.17 -14,808,137.17
（二）所有者投入和减少资本 Capital contributed or reduced by
1,251,338,429.00 1,251,338,429.00
owners
1.股东投入的普通股 Common shares contributed by shareholders 1,251,338,429.00 1,251,338,429.00
2.其他权益工具持有者投入资本 Capital contributed by the holders of
other equity instruments
3.股份支付计入所有者权益的金额 Amounts of share-based payments
recognized in owners' equity
4.其他 Others
（三）利润分配 Profit distribution
1.提取盈余公积 Withdrawal of surplus reserves
2.对所有者（或股东）的分配 Profits distributed to owners (or
shareholders)
3.其他 Others
（四）所有者权益内部结转 Internal carry-forward of owners' equity -1,251,338,429.00 -1,251,338,429.00
1.资本公积转增资本（或股本） Conversion of capital reserves into
-1,251,338,429.00 -1,251,338,429.00
paid-in capital (or share capital)
2.盈余公积转增资本（或股本） Conversion of surplus reserves into
paid-in capital (or share capital)
3.盈余公积弥补亏损 Surplus reserves offsetting losses
4.其他 Others
（五）专项储备 Special reserves
1.本期提取 Amount withdrawn in the current period
2.本期使用 Amount used in the current period
（六）其他 Others
四、本期期末余额 Balance at the end of the current period 1,698,245,011.00 1,237,956,472.37 26,309,287.00 242,353,634.55 3,204,864,404.92
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise: 主管会计工作负责人: Accounting Principal: 会计机构负责人: Head of the Accounting Department:
Financial statements Page 11
神州长城股份有限公司 Sino Great Wall Co., Ltd.
所有者权益变动表（续） Statement of Changes in Owners' Equity (Continued)
2016年度 Year of 2016
（除特别注明外，金额单位均为人民币元） (Monetary units are expressed in RMB unless otherwise stated)
上期发生额 Year 2015
其他权益工具 Other equity instruments
项 目 Item 实收资本（或股本） 减：库存股
资本公积 Capital 其他综合收益 Other 专项储备 盈余公积 Surplus 未分配利润 所有者权益合计 Total
Paid-in capital (or share 优先股 Preferred 永续债 Perpetual Less: Treasury
其他 Others reserves comprehensive income Special reserves reserves Undistributed profits owners' equity
capital) stock debts stock
一、上年年末余额 Balance at the end of the last year 169,142,356.00 31,606,598.00 -4,398,234.00 26,309,287.00 -96,164,557.00 126,495,450.00
加：会计政策变更 Plus: Adjustments for changes in accounting policies
前期差错更正 Correction of accounting errors in prior periods
其他 Others
二、本年年初余额 Balance at the beginning of the year 169,142,356.00 31,606,598.00 -4,398,234.00 26,309,287.00 -96,164,557.00 126,495,450.00
三、本期增减变动金额（减少以“-”号填列） Increases/decreases in the current
277,764,226.00 2,457,688,303.37 4,398,234.00 353,326,328.72 3,093,177,092.09
period (“-” for decreases)
（一）综合收益总额 Total comprehensive income 4,398,234.00 353,326,328.72 357,724,562.72
（二）所有者投入和减少资本 Capital contributed or reduced by owners 277,764,226.00 2,457,688,303.37 2,735,452,529.37
1.股东投入的普通股 Common shares contributed by shareholders 277,764,226.00 2,443,935,757.84 2,721,699,983.84
2.其他权益工具持有者投入资本 Capital contributed by the holders of other equity
instruments
3.股份支付计入所有者权益的金额 Amounts of share-based payments recognized
in owners' equity
4.其他 Others 13,752,545.53 13,752,545.53
（三）利润分配 Profit distribution
1.提取盈余公积 Withdrawal of surplus reserves
2.对所有者（或股东）的分配 Profits distributed to owners (or shareholders)
3.其他 Others
（四）所有者权益内部结转 Internal carry-forward of owners' equity
1.资本公积转增资本（或股本） Conversion of capital reserves into paid-in
capital (or share capital)
2.盈余公积转增资本（或股本） Conversion of surplus reserves into paid-in
capital (or share capital)
3.盈余公积弥补亏损 Surplus reserves offsetting losses
4.其他 Others
（五）专项储备 Special reserves
1.本期提取 Amount withdrawn in the current period
2.本期使用 Amount used in the current period
（六）其他 Others
四、本期期末余额 Balance at the end of the current period 446,906,582.00 2,489,294,901.37 26,309,287.00 257,161,771.72 3,219,672,542.09
后附财务报表附注为财务报表的组成部分。The accompanying notes to the financial statements are integral parts of the financial statements.
企业法定代表人: Legal Representative of Enterprise: 主管会计工作负责人: Accounting Principal: 会计机构负责人: Head of the Accounting Department:
Financial statements Page 12
SINO GREAT WALL CO., LTD.
AUDITORS' REPORT AND FINANCIAL STATEMENTS
(FOR THE YEAR ENDED DECEMBER 31, 2016)
Contents Page
1. Auditors' Report 1-2
2. Financial Statements
Consolidated Balance Sheet and the Company's Balance Sheet 1-4
Consolidated Income Statement and the Company's Income 5-6
Statement
Consolidated Statement of Cash Flows and the Company's Statement 7-8
of Cash Flows
Consolidated Statement of Changes in Owners' Equity and the 9-12
Company's Statement of Changes in Owners' Equity
Notes to the Financial Statements 1-70
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
(Amounts are expressed in RMB unless otherwise stated)
1. Company profile
1.1 Company overview
Sino Great Wall Co., Ltd. (hereinafter referred to as the "Company" or "Sino Great Wall") is
formerly known as Shenzhen Victor Onward Textile Industrial Company Limited which is
formerly known as Xinnan Printing and Dyeing Factory Co., Ltd. Established in 1980, Xinnan
Printing and Dyeing Factory Co., Ltd. is the first wholly foreign-owned enterprise in Shenzhen.
In April 1984, the Xinnan Printing and Dyeing Factory Co., Ltd. was changed into a foreign
joint venture and was renamed Shenzhen Victor Onward Printing and Dyeing Co., Ltd. On
November 19, 1991, approved by the Government of Shenzhen City, Shenzhen Victor Onward
Printing and Dyeing Co., Ltd. was restructured into a joint stock limited company and was
renamed Shenzhen Victor Onward Textile Industrial Company Limited.
Domestic listed RMB ordinary shares ("A" shares; stock code: 000018) and overseas-listed
foreign investment shares ("B" shares; stock code: 200018) issued by the Company were listed
for trading on the Shenzhen Stock Exchange in 1992.
On July 23, 2015, approved by the China Securities Regulatory Commission under the Official
Reply to Approving Shenzhen Victor Onward Textile Industrial Company Limited to Make Major
Assets Restructuring and Issue Shares to Chen Lve and Other Shareholders to Purchase Assets
and Raise Supporting Funds (Z.J.X.K. [2015] No.1774), the Company issued 251,849,593
shares to Chen Lve and other 16 shareholders to purchase 100% of equities of Sino Great Wall
International Engineering Co., Ltd. held by them and issued to them 25,914,633 non-public
offering shares, which raised funds of RMB 254,999,988.72.
As at September 24, 2015, equities of the listed company were changed to be registered in the
name of the Company. Both parties fully completed the transfer of equities and the relevant
formalities of industrial and commercial registration of changes, so the Company already owned
100% of equities in the listed company. Meanwhile, according to the Confirmation on Delivery
of Exchange-Out Assets and as at the date of delivery (namely July 31, 2015), all assets and
liabilities of the Company had been exchanged out. On September 24, 2015, Shenzhen Branch
of the China Securities Depository and Clearing Corporation Limited had completed the relevant
securities registration formalities for the above new shares.
On July 29, 2015, the listed company received the new registered capital of RMB 251,849,593
paid by all the shareholders of Sino Great Wall. Ruihua Certified Public Accountants issued the
Verification Report (R.H.Y.Z. [2015] No.48250011) on July 30, 2015. Registered capital after
the change was RMB 420,991,949 and share capital RMB 420,991,949. On December 4, 2015,
Shenzhen Victor Onward Textile Industrial Company Limited was renamed Sino Great Wall Co.,
Ltd.
At the Company's general meeting of shareholders held on May 6, 2016, the 2015 Plan of
Conversion of Capital Reserves into Share Capital was adopted. The detailed plan was: to
increase capital reserves to all the shareholders with 28 shares for 10 shares based on
446,906,582 shares in total as at December 31, 2015 and to increase 1,251,338,429 shares in
total. After the increase, total share capital of the Company was increased to 1,698,245,011
shares.
As at December 31, 2016, total share capital of the Company was 1,698,245,011 shares, in
which there were 1,434,441,780 circulating A shares and 263,803,231 circulating B shares. Chen
Lve who holds 582,944,556 A shares, accounting for 34.33% of the total share capital, is the
Company's controlling shareholder and actual controller.
Notes to the Financial Statements Page 1
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Registered address of the Company: No.26 Kuipeng Road, Baishi Gang, Kuichong Street,
Dapeng New District, Shenzhen. Legal representative: Chen Lve. The Company falls under
textile printing and dyeing industry. The Company mainly engages in dyeing and printing
production, processing and sales of all kinds of pure cotton, pure linen, polyester cotton, ramie
cotton, high-grade blended fabrics and finished garments.
The financial statements have been approved by the Board of Directors on April 26, 2017.
1.2 Scope of the consolidated financial statements
As at December 31, 2016, subsidiaries within the scope of the consolidated financial statements
of the Company are as follows:
Name of subsidiaries
Sino Great Wall International Engineering Co., Ltd.
Beijing Sino Great Wall Decoration Design Co., Ltd.
Suzhou Lvbang Wood Technology Co., Ltd.
Herabenna Interior Design Guangzhou Co., Ltd.
Sino Great Wall Group Co., Limited
Shanghai Ling Rui International Trade Company Limited
Shenzhen Hongtulve Industrial Co., Ltd.
Inrich Me Engineering Co., Limited
Sino Great Wall New Energy (Beijing) Co., Ltd.
SINO GREAT WALL (PHILIPPINES) INTERNATIONAL CORPORITION
SGW HP Engineering Construction SDN.BHD
SINO GREAT WALL (USA). INC
Shenzhen Yatian Decoration Design Engineering Co., Ltd.
Sino Great Wall International Engineering (MACAU) Co., Limited
SINO GREAT WALL INTERNETIONAL ENGINEERING (CNMI) CO., LLC
Sino Great Wall (Beijing) Investment Fund Management Co., Ltd.
Sino Great Wall Real estate (Hubei) Co., Ltd.
Sino Great Wall Development (Hengqin) Co., Ltd.
PT.SINO GREAT WALL INVESTMENT INDONESIA
PT.SINO GREAT WALL CONSTRUCTION INDONESIA
SINO GREAT WALL INTERNETIONAL ENGINEERING(MM)CO.,LTD
Sino Great Wall Southwest Construction Engineering Co., Ltd.
Sino Great Wall Jianyee Engineering Co., Ltd.
Wuhan Commercial Workers Hospital Co., Ltd.
See “Note 6. Changes in scope of consolidation” and “Note 7. Rights and interests in other
entities” for details of the scope of consolidated financial statements in the current year and the
changes thereof.
2. Preparation basis for financial statements
2.1 Preparation basis
The Company prepares the financial statements based on going concern, according to the
transactions and events actually occurred and in accordance with the Accounting Standards for
Business Enterprises - Basic Standards and various specific accounting standards, application
guidance to and interpretations for the Accounting Standards for Business Enterprises and other
relevant provisions (hereinafter collectively referred to as the "Accounting Standards for
Business Enterprises") promulgated by the Ministry of Finance and disclosure provisions of the
Rules for the Information Disclosure and Compilation of Companies Publicly Issuing Securities
No. 15 - General Rules on Financial Reports promulgated by the China Securities Regulatory
Commission.
Notes to the Financial Statements Page 2
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
2.2 Going concern
The Company will have going-concern abilities within 12 months as of the end of the reporting
period and have no significant events that will affect the going-concern abilities.
3. Significant accounting policies and accounting estimates
3.1 Statement on compliance with Accounting Standards for Business Enterprises
The financial statements prepared by the Company meet the requirements of the Accounting
Standards for Business Enterprises and truly and completely reflect the Company’s financial
position, operating results, cash flows and other related information in the reporting period.
3.2 Accounting period
The accounting year is from January 1 to December 31 in calendar year.
3.3 Operating cycle
The Company's operating cycle is 12 months.
3.4 Functional currency
RMB is the functional currency of the Company and its domestic subsidiaries due to that it is the
currency in the main economic environment in which the Company and its domestic subsidiaries
located. Currency of the Company in preparing its financial statements is RMB.
3.5 Accounting treatment methods of business combinations under common control and not
under common control
Business combination under common control: The assets and liabilities acquired by the
Company in business combinations are measured at the book value of assets and liabilities of the
combinee (including the goodwill arising from the acquisition of the combinee by the ultimate
controller) in the consolidated financial statements of the ultimate controller on the combination
date. The stock premium in the capital reserves should be adjusted at the difference between the
book value of the net assets acquired in combinations and that of consideration paid for the
combination (or total par value of shares issued). If the stock premium in the capital reserves is
insufficient to cover the differences, the retained earnings should be adjusted.
Business combination not under common control: The Company shall, on the acquisition date,
measure the assets surrendered and liabilities incurred or assumed by the Company for a
business combination at their fair values. The Company shall recognize the difference of the
combination costs in excess of the fair value of the identifiable net assets acquired from the
acquiree as goodwill. The Company shall recognize the difference of the combination costs in
short of the fair value of the identifiable net assets acquired from the acquiree in the current
profit or loss after review.
The auditing, legal services, consulting and other intermediary fees and other related
administrative expenses for business combination will be included into current profit and loss
upon occurrence; the transaction costs for the issuance of equity securities shall set off equities.
3.6 Preparation method of consolidated financial statements
3.6.1 Scope of consolidation
The scope of consolidation of the consolidated financial statements of the Company is
recognized based on the control and all subsidiaries (including the divisible part of the
investee controlled by the Company) shall be included in the consolidated financial
statements.
Notes to the Financial Statements Page 3
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.6.2 Procedures of consolidation
The Company prepares the consolidated financial statements based on its own
financial statements and those of its subsidiaries, and other relevant information.
When preparing the consolidated financial statements, the Company treats the
enterprise group as a whole accounting entity, to reflect the overall financial position,
operating results and cash flows in accordance with relevant recognition, measurement
and presentation requirements of Accounting Standards for Business Enterprises and
the uniform accounting policies.
The accounting policies and accounting period adopted by subsidiaries included in the
consolidation scope of the consolidated financial statements shall be the same as those
of the Company; if inconsistent, necessary adjustments shall be made according to the
Company's accounting policies and accounting period in the preparation of the
consolidated financial statements. For the subsidiaries acquired through business
combinations not under common control, adjustments to their financial statements
shall be made based on the fair values of net identifiable assets on the acquisition date.
For subsidiaries acquired through business combination under common control,
adjustments will be made to their financial statements based on the book value of their
assets and liabilities (including the goodwill formed from the ultimate controller's
acquisition of the subsidiaries) in the financial statements of the ultimate controller.
The share of owner's equity, net profits and losses in the current year and
comprehensive income in the current year of subsidiaries attributable to minority
shareholders should be separately presented under the item "owner's equity" in the
consolidated balance sheet, the item "net profit" and the item "total comprehensive
income" in the consolidated income statement. The difference of the loss in the current
year shared by minority shareholders of the subsidiaries in excess of the share of
minority shareholders in the owner's equity at the beginning of the year of the
subsidiaries should be used to offset the minority equity.
(1) Increase in subsidiaries or business
During the reporting period, if the Company increases subsidiaries or business
due to business combination under common control, it shall adjust the beginning
amount of the consolidated balance sheet; include revenues, expenses and profits
of the subsidiaries or business from the beginning of the current combination
period to the end of the reporting period in the consolidated income statement;
include cash flows of the subsidiaries or from the business from the beginning of
the current combination period to the end of the reporting period in the
consolidated cash flow statement; at the same time adjust the relevant items of
the comparative statements to the extent that the reporting entity after
combination has been always existed since the start of control by the ultimate
controller.
Where control can be exercised on the investee under the common control for
additional investment or other reasons, it deems that all parties involved in
combination make adjustment based on the current status when the ultimate
controller starts its control. Equity investments held before the control over the
combinee is obtained, the related gains and losses, other comprehensive income
as well as other changes in net assets recognized from the later of the date when
the original equity is obtained or the date when the combining party and the
combined party are under the same control, to the combination date will
respectively write down the retained earnings or current profit and loss in the
comparative statements.
Notes to the Financial Statements Page 4
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
During the reporting period, if the Group acquired subsidiaries or business from
the business combination not under common control, the beginning balance in
the consolidated balance sheet will not be adjusted. The incomes, expenses and
profits of the newly acquired subsidiaries or business from the acquisition date to
the end of the reporting period shall be included in the consolidated income
statement. The cash flows of the newly acquired subsidiaries or business from the
acquisition date to the end of the reporting period shall be included in the
consolidated statement of cash flows.
Where the Company can implement control over an investee not under common
control due to additional investment or other reasons, the equity held by the
combinee before the purchase date is re-measured at the fair value on the
purchase date of the equity, and the difference between the fair value and the
book value shall be included in the current investment income. In the event that
the equity of the acquiree held prior to the acquisition date involves other
comprehensive income under the equity method and other changes in owners'
equity than net profit and loss, other comprehensive income and profit
distribution, other comprehensive income and other changes in the owner's equity
associated therewith are transferred to investment income of the period to which
the acquisition date belongs, except for other comprehensive income arising from
changes in net liabilities or net assets due to the investee's re-measurement of
defined benefits plan.
(2) Disposal of subsidiaries or business
A. General method of disposal
During the reporting period, if the Company disposes subsidiaries or
business, the incomes, expenses and profits from the subsidiaries or business
from the beginning of the year to the disposal date shall be included in the
consolidated income statement; cash flows of the subsidiaries and business
from the beginning of the year to the disposal date shall be included in the
consolidated statement of cash flows.
When the Company loses the control over the investee due to disposal of
partial equity investment or other reasons, the remaining equity investment
after the disposal will be re-measured by the Company at its fair value on
the date of loss of the control. The difference of total amount of the
consideration from disposal of equities plus the fair value of the remaining
equities less the shares calculated at the original shareholding ratio in net
assets and goodwill of the original subsidiary which are continuously
calculated as of the acquisition date or combination date is included in the
investment income of the period at the loss of control. Other comprehensive
incomes associated with the equity investments of the original subsidiary, or
the changes in owners' equity other than net profit or loss, other
comprehensive income and profit distribution, are transferred into
investment income of the period when control is lost, except for other
comprehensive income from the change in net liability or net asset due to
the investor's re-measurement of designated benefit plan.
B Disposal of subsidiaries by stages
Where the Company disposes the equity investments in subsidiary through
multiple transactions and by stages until it loses the control, if the effect of
the disposal on the terms and conditions as well as economic effect of all
transactions of equity investments in subsidiaries meet one or more of the
following circumstance, it usually indicates that the multiple transactions
should be accounted for as a package deal:
Notes to the Financial Statements Page 5
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
i. the transactions are concluded at the same time or under the
consideration of mutual effect;
ii. the transactions as a whole can reach a complete business result;
iii. the occurrence of a transaction depends on that of at least one other
transactions; and/or
iv. a single transaction is uneconomical but it is economical when
considered together with other transactions.
Where various transactions of disposal of equity investments in subsidiaries
until loss of the control belong to a package deal, accounting treatment shall
be made by the Company on the transactions as a transaction to dispose
subsidiaries and lose the control; however, the difference between each
disposal cost and net asset share in the subsidiaries corresponding to each
disposal of investments before loss of the control should be recognized as
other comprehensive income in the consolidated financial statements and
should be transferred into the current profit or loss at the loss of the control.
Where various transactions of disposal of equity investments in subsidiaries
until loss of the control do not belong to a package deal, before the loss of
the control, accounting treatment shall be made according to the relevant
policies for partial disposal of equity investments in the subsidiary without
losing control; at the loss of the control, accounting treatment shall be made
according to general treatment methods for disposal of subsidiaries.
(3) Purchase of minority equity of subsidiaries
The difference between long-term equity investments acquired by the Company
through purchase of minority interest and the subsidiary’s identifiable net assets
attributable to the Company calculated continuously from the acquisition date (or
the combination date) in accordance with the increased shareholding ratio shall
be charged against stock premium within capital reserves in the consolidated
balance sheet; when stock premium within capital reserves is insufficient to
offset, the retained earnings shall be adjusted.
(4) Partial disposal of equity investments in subsidiaries without loss of control
The difference between the proceeds from partial disposal of equity investments
in the subsidiary and the share of identifiable net assets of the subsidiary
attributable to the Company which are calculated continuously from the
acquisition date (or the combination date) and which are corresponding to the
disposal of long-term equity investments without losing control shall be charged
against stock premium within capital reserves in the consolidated balance sheet;
when stock premium within capital reserves is insufficient to offset, the retained
earnings shall be adjusted.
3.7 Recognition criteria of cash and cash equivalents
For the purpose of preparing the statement of cash flows, the term “cash” refers to the cash on
hand and the unrestricted deposit of the Company. The term “cash equivalents” refers to
short-term (maturing within three months from acquisition) and highly liquid investments that
are readily convertible to known amounts of cash and which are subject to an insignificant risk
of change in value.
Notes to the Financial Statements Page 6
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.8 Foreign currency transactions and translation of foreign currency statements
3.8.1 Foreign currency transactions
Foreign currency transactions are translated into functional currency at the
approximate rate of spot exchange rate on the day when the transactions occur.
The balance of foreign currency monetary items as at the balance sheet date are
translated at the spot exchange rate on the balance sheet date and the exchange
differences arising therefrom shall be included in the current profit or loss, except
those exchange differences arising from the special borrowings of foreign currency
related to the acquired and constructed assets qualified for capitalization that will be
capitalized at the borrowing expenses.
3.8.2 Translation of foreign currency financial statements
Assets and liabilities in the balance sheet shall be translated at the spot exchange rates
on the balance sheet date; for owners' equity items, except for the item of "retained
earnings", other items are translated at the spot exchange rates prevailing on the date
when the transactions occur. The income and expenses items in income statements are
translated at the approximate rate of spot exchange rate prevailing on the date when
transactions occur.
Where the Company disposes of an overseas business, it shall transfer the exchange
difference relating to the overseas business to the current profit and loss.
3.9 Financial instruments
Financial instruments include financial assets, financial liabilities and equity instruments.
3.9.1 Classification of financial instruments
Upon initial recognition, financial assets and financial liabilities are classified into:
financial assets or financial liabilities measured at fair value through current profit or
loss, including financial assets or financial liabilities held for trading (and financial
assets or financial liabilities directly designated to be measured at fair value through
current profit and loss); held-to-maturity investments; receivables; available-for-sale
financial assets; and other financial liabilities, etc.
3.9.2 Recognition basis and measurement method of financial instruments
(1) Financial assets or financial liabilities measured at fair value through current
profit and loss are initially recorded at fair values when acquired (deducting cash
dividends that have been declared but not distributed and bond interest that has
matured but not been drawn). Relevant transaction expenses are included in the
current profit and loss.
The interests or cash dividends to be received during the holding period are
recognized as investment income. Change in fair values is included in the current
profit and loss at the end of the period.
Upon disposal, the difference between the fair value and initial book-entry value
is recognized as investment income, while the gains or losses from changes in
fair value will be adjusted.
(2) Held-to-maturity investments
Held-to-maturity investments are initially recognized at the sum of the fair value
(bond interest due but not yet received) and related transaction costs upon
acquisition.
The interest income will be calculated and determined according to the amortized
cost and effective interest rate during the holding period and included in
investment income. The effective interest rate is determined upon acquisition and
will remain unchanged during the expected renewal period, or a shorter period if
applicable.
Notes to the Financial Statements Page 7
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Upon disposal, the difference between the purchase price obtained and the book
value of the investment is recognized in investment income.
(3) Receivables
For creditor’s rights receivable arising from external sales of goods or rendering
of service by the Company and other creditor's rights of other enterprises
(excluding liability instruments quoted in an active market) held by the Company,
including accounts receivable and other receivables, the initial recognition
amount shall be the contract price or agreement price receivable from purchasing
party; for those with financing nature, they are initially recognized at their
present values.
Upon recovery or disposal, the difference between the purchase price obtained
and the book value of the receivables is recognized in current profit and loss.
(4) Available-for-sale financial assets
Available-for-sale financial assets are initially recorded at the sum of fair values
(deducting cash dividends that have been declared but not distributed and bond
interests that have matured but not been drawn) and transaction costs upon
acquisition.
The interests or cash dividends to be obtained during the holding period are
recognized as investment income. The interest or cash dividends is measured at
fair value and changes in fair value is included in other comprehensive income.
However, for an equity instrument investment that has no quoted price in an
active market and whose fair value cannot be reliably measured, and for
derivative financial asset linked to the said equity instrument and settled by
delivery of the same equity instrument, they are measured at cost.
Difference between the proceeds and the book value of the financial assets is
recognized as investment profit or loss upon disposal; meanwhile, amount of
disposal corresponding to the accumulated change in fair value which is
originally and directly included in other comprehensive income shall be
transferred out and recognized as investment income.
(5) Other financial liabilities
They are initially recognized at the sum of the fair value and the associated
transaction costs. The subsequent measurement is based on amortized costs.
3.9.3 Recognition and measurement of financial assets transfer
When a financial assets transfer occurs, the financial assets will be derecognized when
substantially all the risks and rewards on the ownership of the financial assets have
been transferred to the transferee; and they will not be derecognized if substantially all
the risks and rewards on the ownership of the financial assets have been retained.
The principle of substance over form is adopted to determine whether a financial asset
meets the above de-recognition conditions for the financial asset. The Company
divides the transfer of financial assets into overall transfer and partial transfer. Where
the entire transfer of the financial asset meets the de-recognition conditions, the
difference of the following two amounts will be included in current profit and loss:
(1) the book value of the transferred financial asset;
(2) the sum of the consideration received from the transfer and the accumulated
amount of the changes in fair value originally and directly included in owners’
equity (the situation where the financial asset transferred is an available-for-sale
financial asset is involved).
Notes to the Financial Statements Page 8
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
If the partial transfer of the financial assets meets the de-recognition condition, the
entire book value of the transferred financial asset shall be split into the derecognized
and recognized part according to their respective fair value and the difference between
the amounts of the following two items shall be included in the current profit or loss:
(1) the book value of the derecognized part;
(2) the sum of the consideration for the derecognized part and the portion of
de-recognition corresponding to the accumulated amount of the changes in fair
value originally and directly included in owners’ equity (the situation where the
financial asset transferred is an available-for-sale financial asset is involved).
If the transfer of financial assets does not meet the de-recognition condition, the
financial assets shall continue to be recognized, and the consideration received will be
recognized as a financial liability.
3.9.4 De-recognition conditions of financial liabilities
The whole or partial financial liabilities, which present obligations have been wholly
or partially discharged, shall be de-recognized; if the Company signs an agreement
with the creditor to replace the existing financial liabilities by way of assuming the
new financial liabilities which contract terms are different with those of the existing
financial liabilities, then the existing financial liabilities shall be derecognized and the
new financial liabilities shall be recognized.
Where substantive changes are made to the contract terms of existing financial
liability in whole or in part, the existing financial liabilities or part thereof will be
derecognized, and the financial liability the terms of which have been modified will be
recognized as a new financial liability.
When financial liabilities are derecognized in whole or in part, the difference between
the book value of the financial liabilities derecognized and the consideration paid
(including non-cash assets transferred out or new financial liabilities borne) will be
included into current profit or loss.
When the Company buys back part of financial liabilities, it will allocate the entire
book value of the said financial liabilities on the repurchase date in accordance with
the relative fair value of the recognized part and the terminated part. The difference
between the book value of the derecognized part and the consideration paid (including
non-cash assets surrendered or new financial liabilities assumed) shall be included in
the current profit or loss.
3.9.5 Determination method for the fair value of financial assets and financial
liabilities
The fair value of a financial instrument having an active market is determined on the
basis of quoted price in the active market. The fair value of a financial instrument, for
which there is no active market, is determined by using valuation techniques. For
valuating, the Company chooses input values which characteristics are consistent with
those of assets or liabilities considered by market participants in the course of
transactions of relevant assets or liabilities by using the valuation technique that is
applicable in the present situation and has sufficient available data and other
information supporting, and applies relevant observable input values in priority.
Unobservable input values are used only when relevant observable input values cannot
be available or such values obtained are infeasible.
Notes to the Financial Statements Page 9
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.9.6 Test method and accounting treatment of depreciation of financial assets
(excluding receivables)
Except for the financial assets measured at fair values through current profit or loss,
the Company will check the book value of financial assets on the balance sheet date. If
there is objective evidence indicating that a financial asset is impaired, provision for
impairment will be made.
(1) Provision for impairment of available-for-sale financial assets:
If the fair value of available-for-sale financial assets has significantly declined at
the end of the period, or it is expected that the trend of decrease in value is
non-temporary after considering of various relevant factors, the impairment shall
be recognized, and accumulated losses from decreases in fair value originally and
directly included in owners' equity shall be all transferred out and recognized as
impairment loss.
For available-for-sale debt instruments whose impairment losses have been
recognized, if their fair values rise in the subsequent accounting period and such
rise is objectively related to the events occurring after the recognition of
impairment loss, the previously recognized impairment loss shall be reversed and
recorded into the current profit or loss.
Impairment losses on available-for-sale equity instruments should not be reversed
through profit and loss.
(2) Provision for impairment of held-to-maturity investments:
Measurement of provision for impairment loss on held-to-maturity investments is
treated with reference to the measurement method of impairment loss on
receivables.
3.10 Provision for bad debts of accounts receivable
3.10.1 Receivables that are individually significant but with provision for bad debts
made on an individual basis:
Judgment basis or amount standards for individually significant amount:
The Company recognizes account receivables that are individually significant (more
than or equal to RMB 10 million) and other receivables of a single current entities
(more than or equal to RMB 2 million) as individually significant receivables.
Provision method for receivables with individually significant amount and subject to
individual provision for bad debts:
On the balance sheet date, the Company separately conducts an impairment test on
accounts receivable that are individually significant. Where they are impaired after
such test, the impairment loss is recognized at the difference between the present value
of its future cash flows lower than the book value and the provision for bad debts shall
be made; accounts receivable that are not impaired after the separate test, together
with accounts receivable that are individually insignificant, are divided into several
portfolios according to similar credit risk features. The impairment loss is calculated
and recognized at a certain percentage of these portfolios of accounts receivable in the
balance on the balance sheet date and the provision for bad debts shall be made.
3.10.2 Provision for bad debts of accounts receivable made on credit risk characteristics
portfolio basis:
(1) Basis of determination for credit risk characteristics portfolio:
The Company divides receivables that are individually insignificant and
receivables that are individually significant but that fail to be impaired after a
separate test into groups according to the similarity and correlation of credit risk
Notes to the Financial Statements Page 10
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
characteristics. The provision for bad debts is made based on a certain percentage
of the balance of the portfolio of such receivables. The provision for bad debts
for the current period is calculated based on the actual loss ratio of the
receivables identical or similar thereto in the previous year, in combination with
the proportion of the provision for bad debts in relation to each portfolio in the
current year determined on the basis of practical situation.
(2) Method of bad-debt provision made in terms of the credit risk features portfolio
Methods of provision for bad debts made on credit risk characteristics portfolio
basis
Aging portfolio Aging analysis method
Portfolio of related parties within the scope
of consolidation No provision for bad debts
For those subject to provision for bad debts under aging analysis method:
Proportion of provision Proportion of provision
Aging for receivables for other receivables
(%) (%)
Within 1 year 5 5
1-2 years 10 10
2-3 years 30 30
3-4 years 50 50
4-5 years 80 80
Over 5 years 100 100
3.10.3 Receivables that are individually insignificant but with provision for bad debts
made on an individual basis:
Reasons for individual provision of bad debts
On the balance sheet date, the Company recognizes impairment losses and makes
provision for bad debts of other individually significant receivables with signs of
impairment at the differences of the present values of their future cash flows in short
of their book values.
Method of provision for bad debts
On the balance sheet date, the Company separately conducts an impairment test on
accounts receivable that are individually insignificant but are provided for bad debts
on individual basis. Where they are impaired after such test, the impairment losses are
recognized at the difference between the present value of future cash flows lower than
the book value and the provision for bad debts shall be accordingly made.
3.11 Inventories
3.11.1 Classification of inventories
Inventories are classified into: raw materials, project construction, inventory goods, in
products, low-value consumption goods, etc.
3.11.2 Valuation method of inventories dispatched
The inventories are measured at weighted average method when dispatched.
3.11.3 Recognition basis for net realizable values of inventories of different categories
In normal operation process, for merchandise inventories held directly for sale,
including finished goods, stock commodities and materials for sale, their net realizable
values are determined at the estimated selling prices minus the estimated selling
expenses and relevant taxes and surcharges; in normal operation process, for material
Notes to the Financial Statements Page 11
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
inventories that need further processing, their net realizable values are determined at
the estimated selling prices of finished goods minus estimated costs to completion,
estimated selling expenses and relevant taxes and surcharges; for inventories held to
execute sales contract or service contract, their net realizable values are calculated on
the basis of contract price. If the quantities of inventories specified in sales contracts
are less than the quantities held by the Company, the net realizable value of the excess
portion of inventories shall be based on general selling prices.
The provisions for inventory depreciation reserve are made on an individual basis at
the end of the period, for inventories with large quantities and relatively low unit
prices, the provisions for inventory depreciation reserve are made on a category basis.
For inventories related to the product portfolios manufactured and sold in the same
area, and of which the final usage or purpose is identical or similar thereto, and which
is difficult to separate from other items for measurement purposes, the provisions for
inventory depreciation reserve are made on a portfolio basis.
The net realizable values of inventory items are determined based on the market price
on the balance sheet date, except for there is obvious evidence showing the market
price on the balance sheet date is abnormal.
Net realizable value of inventory items at the end of the year is recognized at the
market price on the balance sheet date.
3.11.4 Inventory system
Perpetual inventory system is adopted.
3.11.5 Amortization methods for low-cost consumables and packaging materials
(1) One-off amortization method is adopted for low-cost consumables;
(2) One-off amortization method is adopted for packaging materials.
3.12 Assets classified as held for sale
The Company recognizes the part (or non-current assets) that meet all the following conditions
as assets held for sale:
(1) the part must be immediately available to be sold under the current conditions and
according to the usual terms on the sale of such part;
(2) the Company has made resolutions on disposing of the part (or non-current assets) and has
been approved by the general meeting or relevant organs of power if the approval of
shareholders is required;
(3) the Company has signed an irrevocable transfer agreement with the assignee;
(4) the transfer will be completed within one year.
3.13 Long-term equity investments
3.13.1 Determination basis of joint control or significant influence over the investee
The term ‘common control’ refers to the joint control, according to the relevant
provisions, over an arrangement, of which the relevant activities should be agreed and
decided by the participants that share the control. Where the Company exercises joint
control over the investee together with other parties to the joint venture and enjoys the
right on the investee's net assets, the investee is a joint venture of the Company.
Notes to the Financial Statements Page 12
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Significant influence refers to the power to participate in making decisions on the
financial and operating policies of an enterprise, but not the power to control, or
jointly control, the formulation of such policies with other parties. Where the
Company is able to have significant influences on an investee, the investee is its
associate.
3.13.2 Determination of initial investment cost
(1) A long-term equity investment as a result of business combination
Business combination under the common control: if the Company makes
payment in cash, transfers non-cash assets or bears debts and issues equity
securities as the consideration for the business combination, the book value of the
owner's equity of the acquiree in the consolidated financial statements of the
ultimate controller is recognized as the initial cost of the long-term equity
investment on the combination date. In case the Company can exercise control
over the investee under common control for additional investment or other
reasons, the initial investment cost of long-term equity investments is recognized
at the share of book value of net asset of the acquiree after the combination in the
consolidated financial statements of the ultimate controller on the combination
date. The stock premium should be adjusted at the difference between the initial
investment cost of long-term equity investments on the combination date and the
book value of long-term equity investments before the combination plus the book
value of consideration paid for additional shares; if there is no sufficient stock
premium for write-downs, the retained earnings are adjusted.
Business combination not under the common control: The Company recognizes
the combination cost determined on the combination date as the initial cost of
long-term equity investments. Where the Company can control the investee not
under common control from additional investments, the initial investment cost
should be changed to be accounted for under the cost method and recognized at
the sum of the book value of equity investments originally held and newly
increased investment cost.
(2) Long-term equity investments obtained by other means
For long-term equity investments acquired from making payments in cash, the
initial cost is the actually paid purchase cost.
For long-term equity investments acquired from issuance of equity securities, the
initial investment cost is the fair value of the issued equity securities.
If the exchange of non-monetary assets has commercial substance and the fair
values of assets traded out and traded in can be measured reliably, the initial cost
of long-term equity investment traded in with non-monetary assets are
determined based on the fair values of the assets traded out and the relevant taxes
and surcharges payable unless there is any conclusive evidence that the fair
values of the assets traded in are more reliable; if the exchange of non-monetary
assets does not meet the above criteria, the book value of the assets traded out
and the relevant taxes and surcharges payable are recognized as the initial cost of
long-term equity investment traded in.
For long-term equity investment acquired from debt restructuring, the initial cost
is determined based on the fair value.
Notes to the Financial Statements Page 13
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.13.3 Subsequent measurements and the recognition method of profits and losses
(1) Long-term equity investments calculated under the cost method
Long-term equity investments of the Company in its subsidiaries are calculated
under the cost method. Except for the actual price paid for acquisition of
investment or the cash dividends or profits contained in the consideration which
have been declared but not yet distributed, the Company recognizes the
investment income in the current year at the cash dividends or profits declared by
the investee.
(2) Long-term equity investments calculated under the equity method
The Company's long-term equity investments in associates and joint ventures are
calculated under the equity method. If the initial cost is more than the share of the
fair value of the investee' identifiable net asset to which the Company shall be
entitled when investing, the initial cost of the long-term equity investment will
not be adjusted. If the initial cost of a long-term equity investment is less than the
share of the fair value of the investee's identifiable net asset to which the
Company shall be entitled when investing, the difference shall be included in the
current profit or loss.
The Company shall recognize the investment income and other comprehensive
income at the shares of net profit and loss and other comprehensive income
realized by the investee which the Company shall enjoy or bear and adjust the
book value of long-term equity investments at the same time; the Company shall
calculate the shares according to profits or cash dividends declared by the
investee and correspondingly reduce the book value of long-term equity
investments; the book value of long-term equity investments shall be adjusted
according to the investee's other changes in owner's equity other than net profit
and loss, other comprehensive income and profit distribution, which should be
included in owner's equity.
The share of the investee's net profit or loss should be recognized after
adjustments are made to net profit of the investee based on the fair value of
identifiable net assets of the investee upon acquisition of investments and
according to accounting policies and accounting period of the Company. When
holding the investment, the investee should prepare the consolidated financial
statements, it shall account for the investment income based on the net profit,
other comprehensive income and the changes in other owner's equity attributable
to the investee.
The Company shall write off the part of incomes from internal unrealized
transactions between the Company and associates and joint ventures which are
attributable to the Company according to the corresponding ratio and recognize
the profit and loss on investments on such basis. Where the losses from internal
transactions between the Company and the investee fall into the scope of assets
impairment loss, the full amount of such losses should be recognized. For
transactions on investments or sales of assets between the Company and
associates and joint ventures, where such assets constitute business, they should
be accounted for according to the relevant policies disclosed in this note
"Accounting treatment of business combinations under common control and not
under common control" and "Preparation of consolidated financial statements".
When the Company recognizes its share of loss incurred to the investee,
treatment shall be done in following sequence: firstly, the book value of the
long-term equity investment shall be reduced; secondly, where the book value is
insufficient to cover the share of losses, investment losses are recognized to the
extent of book value of other long-term equity which forms the net investment in
Notes to the Financial Statements Page 14
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
the investee in substance and the book value of long term receivables shall be
reduced; finally, after all the above treatments, if the Company is still responsible
for any additional liability in accordance with the provisions stipulated in the
investment contracts or agreements, estimated liabilities are recognized and
included into current investment loss according to the obligations estimated to
undertake.
(3) Disposal of long-term equity investments
For disposal of long-term equity investments, the difference between the book
value and the actual price shall be included into the current profit or loss.
For long-term equity investments calculated under the equity method, when the
Company disposes such investments, accounting treatment should be made to the
part that is originally included in other comprehensive income according to the
corresponding proportion by using the same basis for the investee to directly
dispose the relevant assets or liabilities. Owner's equity recognized at the changes
in the investee's other owner's equity other than net profit or loss, other
comprehensive income and profit distribution shall be transferred to the current
profit and loss according to the proportion, except for other comprehensive
income from changes arising from re-measurement of net liabilities or net assets
of defined benefit plan.
In case the joint control or significant influence over the investee is lost for
disposing part of equity investments or other reasons, the remaining equity will
be changed to be accounted for according to the recognition and measurement
principles of financial instruments. The difference between the fair value and the
book value on the date of the loss of joint control or significant influence should
be included in the current profit and loss. For other comprehensive income
recognized from accounting of the original equity investments under the equity
method, accounting treatment should be made by using the same basis for the
investee to directly dispose the relevant assets or liabilities when the equity
method is no longer adopted. Owner's equity recognized from the investee's
changes in other owner's equity other than net profit or loss, other comprehensive
income and profit distribution should all transferred to the current profit and loss
when the equity method confirmed is no longer adopted.
In case the control over the investee is lost due to disposal of part of equity
investments or other reasons, in the preparation of individual financial statements,
the remaining equity after the disposal that can exercise joint control or exert
significant influence over the investee shall be accounted for in the equity
method, and such remaining equity shall be adjusted as if it had been accounted
for in the equity method since the time of acquisition; the remaining equity after
disposal that cannot exercise joint control or exert significant influence over the
investee shall be subject to account treatment according to the relevant provisions
of the recognition and measurement criteria for financial instruments, and the
difference between the fair value on the date when the control is lost and the
book value shall be included into the current profit and loss.
Where equity after the disposal is acquired from business combinations due to
additional investments or other reasons, when the Company prepares individual
financial statements, if the remaining equity after the disposal is accounted for
under the cost method or equity method, other comprehensive income and other
owners' equity recognized from equity investments that are held before the
acquisition date and are accounted for under the equity method should be carried
forward in proportion; if the remaining equity after the disposal is changed to be
accounted for according to recognition and measurement standards of financial
instruments, other comprehensive income and other owners' equity should be
carried forward at full amount.
Notes to the Financial Statements Page 15
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.14 Investment properties
The investment property refers to the real estate held for earning rentals or/and capital
appreciation or both, including leased land use right, land use right held for transfer upon
appreciation, and leased building (including self-built buildings or buildings developed for
renting or buildings under construction or development for future renting).
The Company measures its existing investment property at cost. For investment properties
measured with the cost model - in terms of buildings for renting, the same depreciation policy as
that for fixed assets of the Company is adopted and land use rights for renting are implemented
with the same amortization policy as that for intangible assets.
3.15 Fixed assets
3.15.1 Recognition criteria of fixed assets
Fixed assets refer to the tangible assets held for the purpose of producing commodities,
rendering services, renting or business management with useful lives exceeding one
accounting year. Fixed assets are recognized when they simultaneously meet the
following conditions:
(1) It is probable that the economic benefits relating to the fixed assets will flow into
the Company; and
(2) The costs of the fixed asset can be measured reliably.
3.15.2 Depreciation method
Depreciation of the fixed assets is made on a category basis using the straight-line
method and the depreciation rates are determined according to the categories,
estimated useful lives and estimated net residual rates of fixed assets. Where various
components of fixed assets are different in useful lives or bring economic benefits for
the enterprise in different ways, then the Company should choose different
depreciation rates or methods to separately provide for depreciation.
For fixed assets acquired under financing leases, if there is reasonable assurance that
the Company will obtain the ownership of the leased assets when the lease term
expires, the leased assets should be depreciated over its useful life; if there is no
reasonable assurance that the Company will obtain the ownership of the leased assets
when the lease term expires, the leased assets should be depreciated over the shorter of
the lease term or the useful life of the leased assets.
The depreciation method, depreciation life, residual value rate and annual depreciation
rate of fixed assets are as follows:
Depreciation Residual value Annual depreciation
Category Depreciation method
life (year) rate (%) rate (%)
Buildings and constructions Straight-line method 20 5.00 4.75
Machinery equipment Straight-line method 10 5.00 9.50
Transportation equipment Straight-line method 7 5.00 13.57
Electronic equipment and other equipment Straight-line method 3-5 5.00 19.00-31.67
3.15.3 Determination basis and measurement method of fixed assets acquired under
financing leases
The fixed assets acquired under financing lease are recognized if one of the following
conditions is specified by the Company and the leaser in their lease agreement:
(1) upon the expiration of the lease term, the ownership of the leased asset has been
transferred to the Company;
(2) the Company has the option to purchase the asset and the purchase price is far
lower than the fair value of such asset at the time of the option being exercised;
Notes to the Financial Statements Page 16
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
(3) the lease term covers the most of the useful life of the leased asset;
(4) there is no large difference between the present value of the minimum lease
payments on the lease commencement date and fair value of the assets.
On the lease commencement date, the leased assets are stated at the lower of the fair
value and the present value of the minimum lease payments. Minimum lease payments
are stated at long-term payables and the difference is recognized as unrecognized
financing costs.
3.16 Construction in progress
Projects under construction are recorded as fixed assets at necessary expenditures incurred
before preparing the asset to reach the condition for its intended use. For construction in
progress that has reached working conditions for its intended use but for which the completion
of settlement has not been handled, it shall be transferred into fixed assets at the estimated value
according to the project budget, construction price or actual cost, etc. from the date when it
reaches the working conditions for its intended use. The fixed assets shall be depreciated in
accordance with the Company’s policy on fixed asset depreciation. Adjustment shall be made to
the originally and provisionally estimated value based on the actual cost after the completion of
settlement is handled, but depreciation already provided will not be adjusted.
3.17 Borrowing costs
3.17.1 Recognition principles of capitalization of borrowing costs
Borrowing costs include the interest of borrowings, the amortization of discount or
premium, auxiliary expenses, exchange differences incurred by foreign currency
borrowings, etc.
The borrowing costs incurred to the Company and directly attributable to the
acquisition and construction or production of assets eligible for capitalization should
be capitalized and recorded into relevant asset costs; other borrowing costs should be
recognized as costs according to the amount incurred and be included into the current
profit and loss.
Assets eligible for capitalization refer to fixed assets, investment property, inventories
and other assets which may reach their intended use or sale status only after long-time
acquisition and construction or production activities.
Borrowing costs may be capitalized only when all the following conditions are met at
the same time:
(1) Asset disbursements, which include those incurred by cash payment, the transfer
of non-cash assets or the undertaking of interest-bearing debts for acquiring and
constructing or producing assets eligible for capitalization, have already been
incurred;
(2) Borrowing costs have already been incurred;
(3) The acquisition and construction or production activities which are necessary to
prepare the assets for their intended use or sale have been in progress.
3.17.2 Capitalization period of borrowing costs
Capitalization period refers to the period from the commencement of capitalization of
borrowing costs to its cessation, excluding the period of capitalization suspension of
borrowing costs.
Notes to the Financial Statements Page 17
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Capitalization of borrowing costs should cease when the acquired and constructed or
produced assets eligible for capitalization have reached the working condition for their
intended use or sale.
Where part of the purchase, construction or manufacturing projects of assets are
completed and can be used separately, capitalization of the related borrowing costs
should be ceased.
When some projects among the acquired and constructed or produced assets eligible
for capitalization are completed and can be used separately, the capitalization of
borrowing costs of such projects should be ceased.
3.17.3 Period of capitalization suspension
If the acquisition and construction or production activities of assets eligible for
capitalization are abnormally interrupted and such condition lasts for more than three
months, the capitalization of borrowing costs should be suspended; if the interruption
is necessary procedures for the acquired, constructed or produced assets eligible for
capitalization to reach the working conditions for its intended use or sale, the
borrowing costs continue to be capitalized. Borrowing costs incurred during the
interruption are recognized as the current profit and loss and continue to be capitalized
until the acquisition, construction or production of the asset restarts.
3.17.4 Measurement of capitalization rate and capitalized amounts of borrowing costs
As for special borrowings borrowed for acquiring and constructing or producing assets
eligible for capitalization, borrowing costs of special borrowing actually incurred in
the current period less the interest income of the borrowings unused and deposited in
bank or return on temporary investment should be recognized as the capitalization
amount of borrowing costs.
As for general borrowings used for acquiring and constructing or producing assets
eligible for capitalization, the interest of general borrowings to be capitalized should
be calculated by multiplying the weighted average of asset disbursements of the part
of accumulated asset disbursements exceeding special borrowings by the
capitalization rate of used general borrowings. The capitalization rate is calculated by
weighted average interest rate of general borrowings.
3.18 Intangible assets
3.18.1 Measurement method of intangible assets
(1) The Company initially measures intangible assets at cost on acquisition;
The costs of externally acquired intangible assets include their purchase prices,
related taxes and surcharges and any other directly attributable expenditure
incurred to prepare the asset for its intended use. If the payment for an intangible
asset is delayed beyond the normal credit conditions, which is substantially of the
financing nature, the cost of the intangible asset shall be determined on the basis
of the present value of the purchase price.
The intangible assets acquired and used by the debtor to repay debt in debt
restructuring should be recorded at the fair value of the intangible assets. The
difference between the book value of restructured debts and the fair value of
intangible assets used to repay debt should be included in the current profit and
loss.
On the premise that non-monetary assets trade is of commercial nature and the
fair value of the assets traded in or out can be measured reliably, the intangible
assets traded in with non-monetary assets should be recognized at the fair value
of the assets traded out, unless any unambiguous evidence indicates that the fair
value of the assets traded in is more reliable; as to the non-monetary assets trade
Notes to the Financial Statements Page 18
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
not meeting the aforesaid premise, the book value of the assets traded out and
related taxes and surcharges payable should be recognized as the cost of the
intangible assets, with gains or losses not recognized.
(2) Subsequent measurement
The useful lives of the intangible assets are analyzed and determined on their
acquisition.
For intangible assets with definite useful lives, the Company shall adopt the
straight-line method for amortization within the period during which they can
bring economic benefits to the Company; where the period during which they can
bring economic benefits to the Company cannot be forecast, those intangible
assets shall be deemed as assets with indefinite lives and no amortization will be
made.
3.18.2 Estimate of useful life of intangible assets with limited useful life:
Item Estimated useful lives Basis
Land use right 50 years Land use certificate
Software 5 years By reference to the same industry
The useful life and amortization method of intangible assets with limited useful lives
should be reviewed at the end of each year.
After review, the useful life of intangible assets and amortization method at the end of
the year are not different from previous estimates.
3.18.3 Specific criteria for classification of research phase and development phase
Research phase: the phase for the creative and planned investigation and research to
acquire and understand new scientific or technological knowledge.
Development phase: the phase for the application of research achievements and other
knowledge to a certain plan or design, prior to the commercial production or use, so as
to produce any new material, device or product, or substantially improved material,
device and product.
Expenditures incurred during the research phase of internal research and development
projects shall be written off to current profit and loss.
3.18.4 Specific criteria for capitalization of expenditures at the development phase
Expenditures arising from development phase on internal research and development
projects must be capitalized if the Company can satisfy all of the following criteria
simultaneously:
(1) it is technically feasible to finish intangible assets for use or sale;
(2) it is intended to finish and use or sell the intangible asset;
(3) the ways whereby the intangible asset is to generate economic benefits, including
those whereby it is able prove that there is a potential market for the products
manufactured by applying this intangible asset or that there is a potential market
for the intangible asset itself; if the intangible asset will be used internally, its
usefulness shall be proved;
(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; and
Notes to the Financial Statements Page 19
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
(5) the expenditure attributable to the intangible assets during its development phase
can be reliably measured.
3.19 Impairment of long-term assets
For the long-term equity investments, investment property, fixed assets, construction in progress,
intangible assets, and other long-term assets measured at cost model, if there are signs of
impairment, an impairment test will be conducted on the balance sheet date. If the recoverable
amount of the asset is less than its book value after test, assets impairment provision will be
made at the difference and included into impairment loss. The recoverable amount is determined
at the higher of the net of the fair value less disposal costs and the present value of the expected
future cash flows. The assets impairment provision is calculated and made on an individual basis.
If it is difficult for the Company to estimate the recoverable amount of the individual asset, the
recoverable amount of an asset group, to which the said asset belongs, will be determined. Asset
group is the smallest asset group that can independently generate cash inflows.
For goodwill, impairment test shall be conducted at least in the end of each year.
The Company conducts an impairment test for the goodwill. The book value of goodwill arising
from business combinations is amortized to relevant asset groups with a reasonable method from
the date of acquisition; or amortized to relevant combination of asset groups if it is difficult to be
amortized to relevant asset groups. When the book value of goodwill is amortized to the relevant
assets group or combination of assets groups, it shall be evenly amortized according to the
proportion of the fair value of each assets group or combination of assets groups in the total fair
value of the relevant assets groups or combinations of assets groups. Where the fair value cannot
be reliably measured, it should be amortized according to the proportion of the book value of
each asset group or combination of assets groups in the total book value of assets groups or
combinations of assets groups.
When making an impairment test on the relevant assets groups or combination of assets groups
containing goodwill, if any indication shows that the assets groups or combinations of assets
groups may be impaired, the Company shall first conduct an impairment test on the assets
groups or combinations of assets groups not containing goodwill, calculate the recoverable
amount and compare it with the relevant book value to recognize the corresponding impairment
loss. Then the Company shall conduct an impairment test on the assets groups or combinations
of assets groups containing goodwill, and compare the book value of these assets groups or
combinations of assets groups (including the book value of the goodwill apportioned thereto)
with the recoverable amount. Where the recoverable amount of the relevant assets groups or
combinations of assets groups is lower than the book value thereof, the Company shall
recognize the impairment loss of the goodwill.
The above losses from asset impairment shall not be reversed in subsequent accounting periods
once recognized.
3.20 Long-term deferred expenses
Long-term deferred expenses refer to various expenses which have been already incurred but
will be born in this period and in the future with an amortization period of over one year.
3.20.1 Amortization method
The amortization period is determined in accordance with the contract or expected
beneficial period.
3.20.2 Amortization years
The amortization period is determined in accordance with the contract or expected
beneficial period.
Notes to the Financial Statements Page 20
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.21 Employee compensation
3.21.1 Accounting treatment of short-term compensation
During the accounting period when employees serve the Company, the actual
short-term compensation is recognized as liabilities and included in current profit or
loss or costs associated with assets.
During the accounting period when employees provide services for the Company, the
corresponding amount of employee compensation is calculated and determined
according to the provision basis and provision proportion as stipulated in the
provisions on the social insurance premiums and housing funds paid for employees by
the Company, as well as trade union funds and employee education funds.
The non-monetary benefits of employees that can be measured reliably are measured
at fair value.
3.21.2 Accounting treatment of post-employment benefits
Defined contribution plans
The Company pays basic endowment insurance and unemployment insurance for
employees according to the relevant provisions of the local government, calculate
payables according to payment base and proportion specified by the local government
and recognizes them as liabilities, and includes them into the current profit and loss or
the relevant asset costs.
3.21.3 Accounting treatment of dismissal benefits
The Company recognizes the employee compensation arising from dismissal benefits
as liabilities and include it in the current profit and loss when the Company cannot
unilaterally withdraw dismissal benefits which are provided for termination of labor
relation plan or layoff proposal, or when the Company recognizes costs or expenses
(whichever is earlier) associated with restructuring of payment of dismissal benefits.
3.22 Estimated liabilities
3.22.1 Recognition criteria for estimated liabilities
Where all the following conditions are met simultaneously for any obligation pertinent
to any contingency including litigation, debt guarantee, onerous contract and
reorganization, the Company will recognize such contingency as estimated liabilities:
(1) the obligation is a present obligation of the Company;
(2) the performance of such obligation is likely to result in outflow of economic
benefits from the Company; and
(3) the amount of the obligation can be measured reliably.
3.22.2 Measurement of estimated liabilities
Estimated liabilities of the Company are initially measured as the best estimate of
expenses required for the performance of relevant present obligations.
When the Company determines the best estimate, it should have a comprehensive
consideration of risks with respect to contingencies, uncertainties and the time value
of money. If the time value of money is significant, the best estimate shall be
determined after discounting the relevant future outflow of cash.
The best estimate shall be accounted as follows in different circumstances:
Notes to the Financial Statements Page 21
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
If there is continuous range (or interval) for the necessary expenses, and probabilities
of occurrence of all the outcomes within this range are equal, the best estimates will be
determined at the average amount of upper and lower limits within the range.
If there is no continuous range (or interval) for the necessary expenses, or probabilities
of occurrence of all the outcomes within this range are unequal although such a range
exists, in case that the contingency involves a single item, the best estimate shall be
determined at the most likely outcome; if the contingency involves two or more items,
the best estimate should be determined according to all the possible outcomes with
their relevant probabilities.
When all or some of the expenses necessary for the liquidation of estimated liabilities
of the Company are 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. The amount recognized for the reimbursement should
not exceed the book value of estimated liabilities.
3.23 Share-based payments
The Company's share-based payments are transactions in which the Company grants equity
instruments or undertakes equity-instrument-based liabilities in return for services from
employees [or other parties]. The share-based payments of the Company consist of
equity-settled share-based payments and cash-settled share-based payments.
The equity-settled share-based payment in return for services from employees shall be measured
at the fair value of the equity instruments granted to the employees. Where the Company makes
share-based payments in restricted stocks and the employee makes capital contributions to
subscribe such shares, such shares should not be circulated or transferred before they reach
unlocked conditions and before they are unlocked; if the unlocked conditions specified in the
final equity incentive plan fail to be reached, then the Company should repurchase the shares at
the price agreed in advance. When the Company received the payment of the employee for the
subscription of restricted stocks, it should recognize share capital and capital reserves (share
premiums) in accordance with the payment for subscription received. The Company should fully
recognize a liability at the repurchase obligations and recognize treasury stock at the same time.
On each balance sheet date within the vesting period, the Company will, based on the
newly-acquired subsequent information such as the changes in the number of the vested
employees and whether the specified performance is reached, make the best estimate on the
number of the vesting equity instruments. On such basis, the services received in the current
period should be included in the relevant cost or expenses according to fair value on the date of
grant and capital reserves should be accordingly increased. No adjustments should be made to
the recognized relevant costs or expenses and total owners' equity after the vesting date.
However, when the right can be exercised immediately after the grant, it should be included in
the relevant costs or expenses at the fair value on the date of grant. The capital reserves should
be increased accordingly.
For share-based payments finally failing to be exercised, costs or expenses should not be
recognized, unless the conditions for vesting are market conditions or non-vesting conditions. At
this time, whether market conditions or non-vesting conditions are met or not, it is deemed to
have vesting rights if non-market conditions in all the vesting conditions are met.
If the terms of the equity-settled share-based payments were modified, the services received
should be recognized at least in accordance with the unmodified terms. Moreover, the
modification of fair value of equity instruments granted from any increase, or beneficial changes
to the employee on the modification date should be recognized as increases in services obtained.
If the equity-settled share-based payments were cancelled, they should be handled as accelerated
exercise of rights on the date of cancellation and the amount that is not yet recognized should be
immediately recognized. Where employees or other parties could choose to meet non-vesting
Notes to the Financial Statements Page 22
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
conditions but failed to meet the conditions in the vesting period, they should be handed as
cancelling the equity-settled share-based payments. However, if new equity instruments are
granted, which are recognized as the replacement of the cancelled equity instrument on the grant
data, the granted equity instrument for replacement shall be handled in the same way with the
disposal of revision of provisions on the original equity instrument and conditions.
3.24 Revenue
3.24.1 General recognition principles for revenue from sales of goods:
(1) the Company has transferred the substantial risks and rewards of ownership of
the goods to the buyer;
(2) the Company retains neither continuing managerial involvement to the degree
usually associated with ownership nor effective control over the goods sold;
(3) the amount of revenue can be measured reliably; and
(4) the related economic benefits are likely to flow into the Company; and
(5) the relevant costs that have occurred or will occur can be measured reliably.
3.24.2 Specific principles
(1) Revenue from rendering of service
Revenue from rendering of services of the Company mainly refers to revenue
from engineering design. If the outcome of transactions can be estimated reliably,
revenue shall be recognized at the important timing specified in the design
contract. That is to say, revenue shall be recognized at the percentage of
workload of completed design at the important timing in total design workload
and expected recoverable contract amount.
Where the outcome of transactions on rendering of services cannot be reliably
estimated, the revenue from rendering of services shall be recognized at labor
costs that have been incurred and that are expected to be compensated. The labor
costs that have been incurred are recognized as the expenses in the current period.
Labor costs that have been incurred but that are not expected to be compensated
shall not be recognized as revenue.
When contracts or agreements of the Company concluded with other enterprises
include sales of goods and rendering of services, if the part of sales of goods and
that of rendering of services can be distinguished and be separately measured,
they shall be treated separately; if the part of sales of goods and that of rendering
of services cannot be distinguished or can be distinguished but cannot be
separately measured, the whole contract shall be treated as sales of goods.
(2) Revenue from construction contracts
If the outcome of a construction contract can be reliably estimated, the revenue
and costs from the construction contract will be recognized by the completion
percentage method on the balance sheet date. The progress of the contract
completion is recognized based on the proportion of the actually incurred
contract costs accumulated in the estimated total costs.
Where the outcome of a construction contract cannot be estimated reliably, if
contract costs are not expected to be recoverable, contract revenue is recognized
to the extent of actual contract costs that are expected to be recoverable and the
contract costs are recognized as contract expenses immediately when incurred. If
contract costs are not expected to be recoverable, they are recognized as expenses
immediately when incurred and contract revenue is not recognized. When
uncertainties that make the outcome of a construction contract unable to be
estimated reliably do not exist, revenue and costs associated with construction
contracts should be recognized with the completion percentage method.
Notes to the Financial Statements Page 23
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
If the estimated total contract costs exceed the estimated total contract revenue,
the expected loss is recognized as current expenses.
Accumulated costs incurred and accumulative gross profits (losses) recognized as
well as payments settled as to the construction contract should be presented at the
net amount after the offset in the balance sheet. The part of accumulated costs
incurred plus accumulative gross profits (losses) recognized exceeding payments
settled as to the construction contract should be presented as inventories; the part
of accumulated costs incurred plus accumulative gross profits (losses) recognized
less than the payments settled as to the construction contract should be presented
as advances from customers.
(3) Recognition of revenue from hospital service
The revenue from hospital service mainly comes from out-patient department and
in-patient department, and the revenue is recognized when the patients make the
settlements.
For revenue from out-patient department, as the patients that go to out-patient
department generally require no hospitalization, and receive short term treatment,
they settle with the hospital on the date of visit and pay for the treatment and
medicine. Therefore, the revenue is recognized financially on the date the
payment is received.
For revenue from in-patient department, patients need to stay in for a period of
treatment; they will pay certain advance when being hospitalized, which will not
be recognized at that time. When the patients leave the hospital, they settle the
medical expenses during the hospitalization, the hospital will issue an invoice to
the patients, and then revenue is recognized financially.
3.25 Government subsidies
3.25.1 Type
Government subsidies are monetary assets and non-monetary assets freely obtained by
the Company from the government. They are divided into government subsidies
related to assets and government subsidies related to income.
Government subsidies related to assets refer to government subsidies which are
acquired by the Company for construction or form long-term assets in other ways,
including the financial allocation for purchasing fixed assets or intangible assets, the
financial discount for special loan of fixed assets and others. Government subsidies
related to income refer to those other than the government subsidies related to assets.
3.25.2 Timing of recognition
If government subsidies are monetary assets, it shall be measured in the light of the
amount received or receivable. Where government subsidies are non-monetary assets,
they are measured at fair value; where the fair value cannot be reliably measured, they
are measured at nominal amount. Government subsidies measured at nominal amount
are directly included in the current profit and loss.
3.25.3 Accounting treatment
Government subsidies related to assets are recognized as deferred income, and
included in non-operating income by stages based on the useful life of the assets
acquired and constructed;
if government subsidies related to income are used to compensate the Company’s
relevant expenses or losses in future periods, such government subsidies should be
Notes to the Financial Statements Page 24
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
recognized as deferred income on acquisition and be included in current non-operating
income during the period of recognition of the relevant expenses; if government
subsidies related to income are used to compensate the Company’s relevant expenses
or losses incurred, such government subsidies are directly included into current
non-operating income on acquisition.
3.26 Deferred income tax assets and deferred income tax liabilities
Deferred income tax assets are recognized at deductible temporary differences to the extent that
it shall not exceed the taxable income probably obtained in future period to be against the
deductible temporary difference. For deductible losses and tax credits that can be carried
forward to subsequent periods, deferred tax assets arising therefrom are recognized to the extent
that future taxable income will be probable to be available against deductible losses and tax
credits.
Taxable temporary differences are recognized as deferred income tax liabilities except in special
circumstances.
Such special circumstances in which deferred tax assets or deferred tax liabilities shall not be
recognized include: the initial recognition of goodwill; other transactions or matters excluding
business combinations, which affect neither accounting profits nor the taxable income (or
deductible losses) when incurred.
If the Company has the legal right to settle in net amounts and intends to settle in net amount or
to obtain assets and discharge liabilities simultaneously, the current tax assets and current tax
liabilities of the Company shall be presented based on the net amount upon offset.
When the Company has the legal right for netting of current income tax assets and current
income tax liabilities and the income tax assets and income tax liabilities are related to the
income tax levied on the same taxpayer by the same tax administrative department or are related
to different taxpayers but, within each future period of reversal of important income tax assets
and income tax liabilities, the taxpayers involved intend to settle current income tax assets and
current income tax liabilities or acquire assets and liquidate liabilities at the same time, the
Company's income tax assets and income tax liabilities shall be presented at the net amount after
the offset.
3.27 Leases
3.27.1 Accounting treatment of operating leases
(1) The Company's rental expenses paid for leased assets shall, within the whole
lease term excluding the rent-free period, be amortized with the straight-line
method and included in current expenses. Initial direct costs related to lease
transactions paid by the Company shall be included in the current expenses.
When assets lessor bears costs related to the lease borne by the Company, the
Company shall deduct the part of expenses from the total rents and amortize the
rents after deduction over the lease term and include them in current expenses.
(2) The Company's rental expenses collected for leased assets shall, within the whole
lease term excluding the rent-free period, be amortized with the straight-line
method and recognized as the relevant rental income. Initial direct expenses
relating to lease transactions incurred by the Company shall be recognized as the
current expenses; if the amounts are significant, they shall be capitalized and
included in the current income on the same basis as the recognition of lease
income.
When the Company bears the lease related expenses which should be undertook
by the lessee, the Company shall deduct this part of expense from the total rental
expenses, and amortize the net amount over the lease term.
Notes to the Financial Statements Page 25
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
3.27.2 Accounting treatment of financing lease
(1) Assets leased in under financing leases: On the lease commencement date, the
book entry value of a fixed asset acquired under financing lease is measured at
the asset’s fair value or the present value of the minimum lease payment,
whichever is the lower. The minimum lease payment is recorded as the book
entry value of the long-term payables, and the difference between them is deemed
as the unrecognized financing expenses. The Company adopts the effective
interest rate method for unrecognized financing charges, which shall be
amortized over the lease terms and included in financial expenses. The Company
records the initial direct expenses in the values of leased assets.
(2) Assets leased under finance leases: On the lease beginning date, the Company
recognizes the difference between the sum of financing lease receivable and the
unguaranteed residual value, and the present value thereof as unrealized
financing income, and recognizes the same as rental income over the periods
when rent is received in the future. The Company's initial direct costs related to
the rental transactions will be included in the initial measurement of the financing
lease receivables and the amount of revenue recognized in the lease term will be
reduced.
3.28 Discontinued operation
Discontinued operations refer to the component meeting any of the following conditions that has
been disposed by the Company or classified as held for sale by the Company, and that can be
separately identified upon operation and preparation for the financial statements:
(1) the component represents a separate major business or a major business areas;
(2) the component is a part of the plan on intended disposal of an independent major business
or a major business area; or
(3) the part is a subsidiary acquired only for resale.
3.29 Changes in significant accounting policies and accounting estimates
3.29.1 Changes in significant accounting policies
(1) Implementation of the Provisions on the Accounting Treatment for Value-added
Tax
On December 3, 2016, the Ministry of Finance promulgated the Provisions on the
Accounting Treatment for Value-added Tax (Cai Kuai [2016] No.22), which
apply to relevant transactions of the Company occurred since May 1, 2016. Main
impacts of the provisions implementation of the Company are as follows:
Contents of and reasons for changes in Name and amount of the affected
accounting policies items in the financial statements
(1) Adjust the item "business taxes and
surcharges" in the income statement to
the item "taxes and surcharges" therein. Taxes and surcharges
(2) Reclassify the real estate tax,
land-use tax-, vehicle and vessel use tax
and stamp duty incurred by business
operation activities of the enterprise
since May 1, 2016 from "General and
administrative expenses" to "Taxes and Increased taxes and surcharges in
surcharges" and the taxes incurred this year amount to RMB
before May 1, 2016 will not be adjusted. 433,364.39, and decreased general
The comparative data shall not be and administrative expenses in 2016
adjusted. amount to RMB 433,364.39.
(3) Reclassify the item "taxes and Increased ending balance of other
Notes to the Financial Statements Page 26
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
surcharges payable" to transfer the VAT current liabilities amounted to RMB
amount where income (or profit) has 30,382,980.72, and decreased ending
been recognized but the VAT has not balance of taxes and surcharges
been paid and which shall be recognized payable amounted to RMB
as the output tax amount into the item 30,382,980.72.
"other current liabilities" (or "other
non-current liabilities"). Compared data
shall not be adjusted. The comparative
data shall not be adjusted.
3.29.2 Changes in significant accounting estimates
The Company had no changes in principal accounting estimates during the reporting
period.
4. Taxation
4.1 Major tax types and tax rates
Tax type Tax basis Tax rate
(%)
The output tax is calculated based on taxable income in
accordance with tax laws, and value added tax payable
should be the balance of the output tax after deducting 0, 3, 6, 11
Value added tax (VAT) the deductible input tax for the current period and 17
Business tax Levied based on the taxable operating income 3 and 5
Urban maintenance and Paid based on the actual business tax, VAT and
construction tax consumption tax paid 1, 5 and 7
Education surtax Calculated and paid at turnover tax actually paid. 3
Local education surtax Calculated and paid at turnover tax actually paid. 2
Enterprise income tax Levied based on the amount of taxable income 15, 25
Notes to the Financial Statements Page 27
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Note 1 According to the Circular on Launching the Pilot Collection of Value Added Tax in lieu
of Business Tax in Transportation and Certain Areas of Modern Services Industries in Eight
Provinces and Municipalities Including Beijing (Cai Shui [2012] No.71) promulgated by the
Ministry of Finance and the State Administration of Taxation on July 31, 2012, design business
of the Company’s subsidiary Beijing Sino Great Wall Decoration Design Co., Ltd. (hereinafter
referred to as the "Sino Great Wall Design") was changed from taxable items under business tax
to those under value added tax as of September 1, 2012, so the Company and Sino Great Wall
Design became a small-scale VAT taxpayer and were subject to the rate of 3%.
Rates of income tax in regard to the Company and its subsidiaries:
Income tax rate
Name of subsidiary Remarks
(%)
Sino Great Wall Co., Ltd. 25
Sino Great Wall Medical Investment Management Co., Ltd. 25
Sino Great Wall Infrastructure Investment Co., Ltd. 25
Wuhan Commercial Workers Hospital Co., Ltd. 25
Sino Great Wall International Engineering Co., Ltd. 15
Sino Great Wall Jianyee Engineering Co., Ltd. (formerly known as
Sichuan Haoyao Constructional Engineering Co., Ltd.) 25
Sino Great Wall (Beijing) Investment Fund Management Co., Ltd. 25
Sino Great Wall Real estate (Hubei) Co., Ltd. 25
Sino Great Wall New Energy (Beijing) Co., Ltd. 25
Qian'an Sino Solar Power Generation Co., Ltd. 25
Wu'an Juhe Photovoltaic Power Generation Co., Ltd. 25
Bozhou Guangcheng New Energy Co., Ltd. 25
Bozhou Zhaosheng Agricultural Technology Co., Ltd. 25
Bozhou Xieying Solar Power Generation Co., Ltd. 25
Shanghai Ling Rui International Trade Company Limited 25
Shenzhen Hongtulve Industrial Co., Ltd. 25
Sino Great Wall Development (Hengqin) Co., Ltd. 25
SINO GREAT WALL (USA). INC 30
Herabenna Interior Design Guangzhou Co., Ltd. 25
Inrich Me Engineering Co., Limited 17
Sino Great Wall Southwest Construction Engineering Co., Ltd.
(formerly known as Sichuan Dinghui Construction Co., Ltd.) 25
PT.SINO GREAT WALL INVESTMENT INDONESIA 25
PT.SINO GREAT WALL CONSTRUCTION INDONESIA 25
Seven levels of
tax rates from 0%
to 5%,
SINO GREAT WALL INTERNETIONAL non-deductible
ENGINEERING(CNMI)CO., LLC progressive
Shenzhen Yatian Decoration Design Engineering Co., Ltd. 25
Sino Great Wall International Engineering (MACAU) Co., Limited 12
Sino Great Wall Group Co., Limited 17
SGW HP Engineering Construction SDN. BHD 24
SINO GREAT WALL (PHILIPPINES) INTERNATIONAL
CORPORITION 30
Beijing Sino Great Wall Decoration Design Co., Ltd. 25
Suzhou Lvbang Wood Technology Co., Ltd. 25
Sino Heji Environmental Protection Materials Co., Ltd. 25
SINO GREAT WALL INTERNETIONAL ENGINEERING(MM)
CO., LTD 25
Sino Great Wall International Engineering (Thailand) Co., Ltd. 20
4.2 Tax preference
(1) Approved by the Beijing Municipal Office, SAT under the Circular on Approval of Tax
Types in 2013, the taxable income of Sino Great Wall Design was calculated at 10% of
total income.
Notes to the Financial Statements Page 28
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
(2) According to the provisions of the Circular of the State Administration of Taxation on
Issuing the Tentative Measures for the Collection and Administration of Income Tax on
Enterprises That Have Operations in Different Regions and That Pay Taxes in a
Consolidated Manner (G.S.F. [2008] No. 28) issued on March 10, 2008, for business
institutions and establishments without the status of a legal person that are established in
different regions within the territory of China, namely those engaging in production and
operating activities in different regions, their head offices (parent companies) are
enterprises that pay taxes in a consolidated manner. The parent company pays taxes in a
consolidated manner. Head office and branches prepay enterprise income tax in installment,
50% of which is shared by all branches and 50% of which is prepaid by the head office.
Branches share the prepayments in the proportion of 35%, 35% and 30% of operating
income, employee compensation and total assets; final settlement of annual enterprise
income tax shall be made by the parent company at the tax authority and will no longer be
allocated to branches.
(3) The Company's subsidiaries Sino Great Wall Group Co., Limited (hereinafter referred to as
"Sino Hong Kong") and Inrich Me Engineering Co., Limited (hereinafter referred to as
"Inrich Me Engineering") are enterprises established in the Hong Kong Special
Administrative Region and are subject to enterprise profit tax at the rate of 16.5%; Sino
Great Wall International Engineering (MACAU) Co., Limited (hereinafter referred to as
"Sino Macau") is an enterprise established in the Macao Special Administrative Region and
is subject to complementary income tax at the progressive rate.
(4) The Company's wholly-owned subsidiary Sino Great Wall International Engineering Co.,
Ltd. (hereinafter referred to as "Sino International") obtained the high-tech enterprise
certificate (No.: GR201511003125) jointly approved and issued by Beijing Municipal
Science and Technology Commission, Beijing Municipal Finance Bureau, Beijing
Municipal Office, SAT and Beijing Local Taxation Bureau on November 24, 2015. The
certificate was issued on November 24, 2015 and valid for 3 years, so Sino International
would pay enterprise income tax at the rate of 15% in 2015, 2016 and 2017.
(5) The Company's wholly-owned subsidiary Wuhan Commercial Workers Hospital Co., Ltd.
was entitled to the exemption of value-added taxes since May 1, 2016 in accordance with
the Notice of the Ministry of Finance and the State Administration of Taxation on
Implementing the Pilot Program of Replacing Business Tax with Value-Added Tax in an
All-round Manner (Cai Shui [2016] No.36).
5. Notes to the items of consolidated financial statements
5.1 Cash and cash equivalents
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Cash on hand 2,974,883.16 1,349,587.20
Bank deposits 940,730,439.25 343,390,159.56
Other monetary funds 397,110,499.42 350,644,814.55
Total 1,340,815,821.83 695,384,561.31
Including: Total amount deposited abroad 197,496,287.50 60,170,773.67
Cash or cash equivalents being restricted for use due to mortgage, pledge or freezing, or being
placed overseas with restrictions on fund repatriation as follows:
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Bank acceptance bills margin 140,689,860.21 46,497,936.83
Performance bond 255,913,019.19 64,202,294.79
Deposits for peasant laborers 507,620.02 1,532,920.07
Term deposits or call deposits for guarantee
Notes to the Financial Statements Page 29
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Funds placed overseas with restrictions on fund
repatriation 405,652.81
Total 397,110,499.42 112,638,804.50
5.2 Financial assets measured at fair value through current profit and loss
5.2.1 Financial assets measured at fair value through current profit and loss
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Money market fund 1,102,961.04
Total 1,102,961.04
5.3 Notes receivable
5.3.1 Notes receivable by category
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Bank acceptance bills 21,300,446.44 4,040,251.87
Commercial acceptance bills 1,053,090,196.14 216,408,496.07
Total 1,074,390,642.58 220,448,747.94
5.3.2 Pledged notes receivable of the Company as at December 31, 2016
Pledged amount as at
Item
December 31, 2016
Bank acceptance draft -
Commercial acceptance draft 98,645,997.87
Total 98,645,997.87
5.3.3 Notes receivable endorsed or discounted by the Company as at December 31,
2016 but not expired on the balance sheet date
Amount of Amount
derecognition as underecognized
Item
at December 31, as at December
2016 31, 2016
Bank acceptance draft 207,110,526.41
Commercial acceptance draft 345,762,089.05
Total 207,110,526.41 345,762,089.05
5.4 Accounts receivable
5.4.1 Disclosure of accounts receivable by category
Balance as at December 31, 2016
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount
(%) Amount provision (%)
Receivables that are individually significant
but with provision for bad debts made on an
individual basis
Receivables subject to provisions for bad
debts on credit risk characteristics basis 4,148,182,356.26 99.91 423,012,147.95 10.20 3,725,170,208.31
Receivables that are individually
insignificant but with provision for bad
debts made on an individual basis 3,844,309.34 0.09 3,844,309.34 100.00 -
Total 4,152,026,665.60 100.00 426,856,457.29 10.28 3,725,170,208.31
Notes to the Financial Statements Page 30
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
(Continued)
Balance as at January 1, 2016
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount (%) Amount provision (%)
Receivables that are individually
significant but with provision for bad
debts made on an individual basis
Receivables subject to provisions for bad
debts on credit risk characteristics basis 2,638,742,183.89 100.00 285,934,096.56 10.84 2,352,808,087.33
Receivables that are individually
insignificant but with provision for bad
debts made on an individual basis
Total 2,638,742,183.89 100.00 285,934,096.56 10.84 2,352,808,087.33
In the portfolio, accounts receivable with the provision for bad debts made under the
aging analysis method:
Balance as at December 31, 2016
Aging Account Provision for Proportion of
receivable bad debts provision (%)
Within1 year 2,981,476,004.74 149,073,800.25 5.00
1-2 years 665,268,747.44 66,526,874.75 10.00
2-3 years 281,948,783.56 84,584,635.07 30.00
3-4 years 177,703,424.82 88,851,712.41 50.00
4-5 years 39,051,351.16 31,241,080.93 80.00
Over 5 years 2,734,044.54 2,734,044.54 100.00
Total 4,148,182,356.26 423,012,147.95
5.4.2 Provision, reversal or recovery of bad debts in 2016
The amount of the provision for bad debts in 2016 was RMB 127,789,717.16; the
amount of increase in bad debts on a consolidated basis in 2016 was RMB
13,132,643.57; and no bad debts were recovered or reversed in 2016.
5.4.3 Accounts receivable actually written off in 2016
No accounts receivable were actually written off during the reporting period.
5.4.4 Top five of accounts receivable by the debtor
Balance as at December 31, 2016
Proportion in the
Name of company Provision for
Account receivable total accounts
bad debts
receivable (%)
China Harbour Engineering Company
Ltd. 672,067,475.39 16.19 33,644,960.56
CHINA CENTRAL ASIA GROUP Co.
Ltd 436,859,602.82 10.52 21,842,980.14
PowerChina Construction Group Ltd. 302,978,738.20 7.30 15,148,936.91
Oxley Diamond (Cambodia) Co., Ltd 282,328,914.30 6.80 14,116,445.72
Henan No.1 Thermal Power
Construction Co., Ltd. 203,103,421.33 4.89 13,042,616.76
Total 1,897,338,152.04 45.70 97,795,940.09
Notes to the Financial Statements Page 31
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
5.4.5 Accounts receivable derecognized due to the transfer of financial assets
Gains or losses
Amount Method of financial assets
Name of company Project on
derecognized transfer
derecognition
Xiamen Jiayu Real Estate Xiamen Semi-hill Transfer of creditors’
Development Co., Ltd. Grand View B03 14,160,461.27 right (without recourse) 1,621,895.35
Apartments of Jinan
Jinan Haier Green Town Property National Games Transfer of creditors’
Co., Ltd. Village 10,296,979.40 right (without recourse) 1,179,384.11
Building No. 1,
Zhongda Square,
Guangzhou Poly Pearl Transfer of creditors’
Poly Real Estate Group Co., Ltd River New Town 5,566,496.88 right (without recourse) 637,569.30
Qingdao Green Town Jiaozhou Bay Jiaozhou Bay Sheraton Transfer of creditors’
Real Estate Development Co., Ltd. Hotel 5,151,220.21 right (without recourse) 590,004.80
Dalian Aonan House Development Dalian Mingxiu Manor Transfer of creditors’
Co., Ltd. Type B House 4,695,452.00 right (without recourse) 537,802.52
Chaobai River
Daweicheng Phase 2
Dachang Jingyu Real Estate Stone Curtain Wall Transfer of creditors’
Development Co., Ltd. Project 4,664,024.76 right (without recourse) 534,202.94
Dalian Red Star
Dalian Zhengqian Property Co., Coastal Community Transfer of creditors’
Ltd. Project 4,237,549.39 right (without recourse) 485,355.77
Hohhot Daya
Inner Mongolia Yitai Property Co., Comprehensive Transfer of creditors’
Ltd. Building 4,212,745.43 right (without recourse) 482,514.81
Panyu Poly Transfer of creditors’
Poly Real Estate Group Co., Ltd Champagne Mansion 4,191,403.58 right (without recourse) 480,070.38
Dalian Zhengqian Property Co., Transfer of creditors’
Ltd. Dalian Red Star Sea 2,474,061.00 right (without recourse) 283,371.28
Tangshan Hengrong Real Estate Transfer of creditors’
Development Co., Ltd. Tang City 101 2,105,541.40 right (without recourse) 241,162.19
Zhuhai Poly Golden
Bay Project, No. 9
Poly (Zhuhai) Real Estate model building and Transfer of creditors’
Development Co., Ltd. model room in the hall 2,078,996.00 right (without recourse) 238,121.76
Inner Mongolia Transfer of creditors’
Chifeng Wanda Plaza Co., Ltd. Chifeng Wanda Hotel 1,437,783.42 right (without recourse) 164,679.26
Hangzhou Zhongtian
Project Plot No. 25
Hangzhou Gemdale Zhongtian Real Block A High-rise Transfer of creditors’
Estate Development Co., Ltd. indoor decoration 1,199,168.80 right (without recourse) 137,349.07
Total 66,471,883.54 7,613,483.54
Note: On June 25, 2016, the Company and Dagang Financing Lease (Shanghai) Co.,
Ltd. signed an agreement on transfer of creditors’ right (No.: BLW-SZDG-2016002),
according to which the Company transferred 14 items of accounts receivable of
RMB66,471,883.54 to Dagang Financing Lease (Shanghai) Co., Ltd. at a transfer
price of RMB 58,858,400.00 without recourse as agreed therein. The Company
derecognized accounts receivable in 2016, and included the loss of RMB 7,613,483.54
on transfer in non-operating expenses.
Notes to the Financial Statements Page 32
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
5.5 Advances to suppliers
5.5.1 Advances to suppliers by aging
Balance as at December 31, 2016 Balance as at January 1, 2016
Aging Proportion Proportion
Book balance Book balance
(%) (%)
Within 1 year 311,193,306.31 97.49 70,146,608.20 90.27
1-2 years 5,789,414.72 1.81 5,258,018.08 6.77
2-3 years 1,269,897.25 0.40 1,090,606.22 1.40
Over 3 years 954,180.35 0.30 1,212,335.88 1.56
Total 319,206,798.63 100.00 77,707,568.38 100.00
5.5.2 Top five advances by suppliers
Proportion in the total
Balance as at
balance of advances to
Supplier December 31,
suppliers as at December
2016
31, 2016 (%)
Qingyuan Hefeng New Energy
Technology Co., Ltd. 165,000,000.00 51.69
Nanjing Zhongjian Chemical
Equipment Manufacturing Co., Ltd. 40,676,756.76 12.74
Shenyang Zhaohuan Modern
Architectural Industrial Park Co.,
Ltd. 4,639,008.00 1.45
GULFLIGHTSELECTRICALENGI
NEERINGWLL 4,314,087.18 1.35
CSSC (Cambodia) Co., Ltd. 3,651,831.04 1.15
Total 218,281,682.98 68.38
5.6 Other receivables
5.6.1 Disclosure of other receivables by category:
Balance as at December 31, 2016
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Other receivables with individually
significant amount and subject to separate
provision for bad debts
Other receivables with provision for bad
debts accrued by credit risk features
portfolio 709,527,391.05 99.93 58,515,258.14 8.25 651,012,132.91
Other receivables with individually
insignificant amount but subject to
individual provision for bad debts 500,000.00 0.07 500,000.00 100.00
Total 710,027,391.05 100.00 59,015,258.14 8.31 651,012,132.91
(Continued)
Balance as at January 1, 2016
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount (%) Amount provision (%)
Other receivables with significant single
amount and individual provision for bad
debts
Notes to the Financial Statements Page 33
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Balance as at January 1, 2016
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount (%) Amount provision (%)
Other receivables with provision for bad
debts accrued by portfolio with credit risk
features 261,942,379.50 99.82 21,989,493.39 8.39 239,952,886.11
Other receivables with insignificant single
amount and individual provision for bad
debts 478,000.00 0.18 478,000.00 100
Total 262,420,379.50 100 22,467,493.39 8.56 239,952,886.11
Other receivables subject to provision for bad debts under aging analysis method:
Balance as at December 31, 2016
Aging Provision for bad Proportion of
Other receivables
debts provision (%)
Within 1 year 574,225,645.55 28,714,087.87 5.00
1-2 years 72,506,847.29 7,250,684.74 10.00
2-3 years 50,949,805.67 15,284,941.71 30.00
3-4 years 8,772,720.70 4,386,360.35 50.00
4-5 years 965,941.84 772,753.47 80.00
Over 5 years 2,106,430.00 2,106,430.00 100.00
Total 709,527,391.05 58,515,258.14
5.6.2 Provision, reversal or recovery of bad debts in 2016
The amount of the provision for bad debts in 2016 was RMB 35,012,661.40; the
amount of increase in bad debts on a consolidated basis in 2016 was RMB
1,535,103.35; and no bad debts were recovered or reversed in 2016.
5.6.3 Other receivables actually written off in 2016
Item Written-off amount
Actual write-off of other receivables 1,485,463.34
5.6.4 Classification of other receivables by the nature of payment
Book balance as at Book balance as at
Nature of Payment
December 31, 2016 January 1, 2016
Bidding margins, performance bonds
and deposits 366,310,322.14 168,213,515.22
Petty cash and current accounts
between individuals 59,867,918.12 40,331,852.58
Current accounts among entities 282,984,039.72 53,815,203.95
Others 865,111.07 59,807.75
Total 710,027,391.05 262,420,379.50
5.6.5 Top five of other receivables by the debtor
Proportion in total Provision for
Balance as at balance of other bad debts
Name of company Nature December 31, Aging receivables as at Balance as at
2016 December 31, December 31,
2016 (%) 2016
PowerChina Construction Current accounts Within 1
Group Ltd. among entities 259,423,663.63 year 36.54 12,971,183.18
Bidding margins,
PT.WANXIANGNICKELIN performance bonds Within 1
DONESIA and deposits 68,000,000.00 year 9.58 3,400,000.00
Notes to the Financial Statements Page 34
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Proportion in total Provision for
Balance as at balance of other bad debts
Name of company Nature December 31, Aging receivables as at Balance as at
2016 December 31, December 31,
2016 (%) 2016
Chengdu Qingyuan Real Bidding margins,
Estate Development Co., performance bonds Within 1
Ltd. and deposits 30,000,000.00 year 4.23 1,500,000.00
Leading Group Office for
Reconstruction and
Extension Project of
Jingfeng Hotel of the Bidding margins,
General Logistics performance bonds
Department of PLA and deposits 30,000,000.00 2-3 years 4.23 9,000,000.00
Bidding margins,
Shenzhen Jinshawan Hotel performance bonds Within 1
Co., Ltd. and deposits 27,655,391.29 year 3.88 1,382,769.57
Total / 415,079,054.92 58.46 28,253,952.75
5.7 Inventories
5.7.1 Classification of inventories
Balance as at December 31, 2016 Balance as at January 1, 2016
Item Provision for Provision for
Book balance Book value Book balance Book value
depreciation depreciation
Raw materials 12,078,945.75 - 12,078,945.75 13,086,673.87 13,086,673.87
Stock
commodities 43,492,877.62 1,404,765.68 42,088,111.94 7,538,609.26 1,352,585.08 6,186,024.18
Engineering
construction 282,911,079.94 5,051,867.60 277,859,212.34 148,457,514.11 148,457,514.11
Goods in transit - - - 403,456.75 403,456.75
Goods in
progress 668,934.23 - 668,934.23
Low-cost
consumables 209,726.10 - 209,726.10
Total 339,361,563.64 6,456,633.28 332,904,930.36 169,486,253.99 1,352,585.08 168,133,668.91
Notes to the Financial Statements Page 35
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
5.7.2 Inventory provision
Balance as at Increase in 2016 Decrease in 2016 Balance as at
Item January 1, Reversal or December 31,
Provision Others Others
2016 write-off 2016
Stock commodities 1,352,585.08 52,180.60 1,404,765.68
Engineering construction 5,051,867.60 5,051,867.60
Total 1,352,585.08 5,104,048.20 6,456,633.28
5.8 Non-current assets maturing within one year
Item Balance as at December 31, 2016 Balance as at January 1, 2016
Long-term borrowings maturing within one year 13,462,942.89 15,717,270.60
Total 13,462,942.89 15,717,270.60
5.9 Other current assets
Item Balance as at December 31, 2016 Balance as at January 1, 2016
Input tax 35,248,102.26 14,138,411.87
Income tax expenses prepaid 202,092.21
Total 35,450,194.47 14,138,411.87
5.10 Fixed assets
5.10.1 Fixed assets
Electronic
Buildings and Machinery Transportation
Item equipment and Total
constructions equipment equipment
other equipment
1. Original book value
(1) Balance as at January 1, 2016 10,193,831.80 15,124,117.90 27,339,595.16 5,372,383.58 58,029,928.44
(2) Increase in 2016 57,775,649.24 73,898,441.45 8,823,721.31 10,286,188.75 150,784,000.75
- Purchase 17,027,997.40 19,620,984.99 6,436,507.07 1,848,909.82 44,934,399.28
- Transfer of construction in progress 5,898,702.19 4,664,068.70 10,562,770.89
- Increase due to business combinations 34,848,949.65 45,459,977.76 2,387,214.24 8,424,278.93 91,120,420.58
- Others 4,153,410.00 13,000.00 4,166,410.00
(3) Decrease in 2016 7,768,106.00 - 952,895.00 8,721,001.00
- Disposal or write-off 3,614,696.00 939,895.00 4,554,591.00
- Others 4,153,410.00 13,000.00 4,166,410.00
Notes to the Financial Statements Page 36
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Electronic
Buildings and Machinery Transportation
Item equipment and Total
constructions equipment equipment
other equipment
(4) Balance as at December 31, 2016 67,969,481.04 81,254,453.35 36,163,316.47 14,705,677.33 200,092,928.19
2. Accumulated depreciation - - - -
(1) Balance as at January 1, 2016 74,769.21 624,167.49 11,569,621.16 1,915,154.95 14,183,712.81
(2) Increase in 2016 15,053,031.73 33,414,280.49 4,895,747.20 8,483,410.78 61,846,470.20
- Provision 655,224.14 3,366,867.97 3,215,361.21 1,631,494.27 8,868,947.59
- Others 14,397,807.59 30,047,412.52 1,680,385.99 6,851,916.51 52,977,522.61
(3) Decrease in 2016 - 3,525,400.06 - 895,602.49 4,421,002.55
- Disposal or write-off 3,097,944.85 891,142.76 3,989,087.61
- Others 427,455.21 4,459.73 431,914.94
(4) Balance as at December 31, 2016 15,127,800.94 30,513,047.92 16,465,368.36 9,502,963.24 71,609,180.46
3. Provision for impairment - - - -
(1) Balance as at January 1, 2016 - - - - -
(2) Increase in 2016 - - - - -
- Provision - - - - -
- Others - - - - -
(3) Decrease in 2016 - - - - -
- Disposal or write-off - - - - -
- Others - - - - -
(4) Balance as at December 31, 2016 - - - - -
4. Book value - - - -
(1) Book value as at December 31, 2016 52,841,680.10 50,741,405.43 19,697,948.11 5,202,714.09 128,483,747.74
(2) Book value as at January 1, 2016 10,119,062.59 14,499,950.41 15,769,974.00 3,457,228.63 43,846,215.63
5.10.2 Temporarily idle fixed assets
There were no temporarily idle fixed assets in 2016.
5.10.3 Fixed assets with pending certificate of title
Item Book value Reason for absence of certificate of title
Suzhou factory 5,751,234.64 The relevant formalities are going through
Notes to the Financial Statements Page 37
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
5.11 Construction in process
5.11.1 Construction in progress
Balance as at December 31, 2016 Balance as at January 1, 2016
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Suzhou Lvbang Plant 4,978,670.79 4,978,670.79
Kuwait tower cranes 5,038,257.45 5,038,257.45
Total 10,016,928.24 10,016,928.24
5.11.2 Changes in important construction in progress in 2016
Balance as Accumulated Including: Interest
Balance as Transfer into Other Percentage
Increase at capitalization Interest capitalization Sources of
Project Budget at January fixed assets in decreases of
in 2016 December amount of capitalized rate in 2016 funds
1, 2016 2016 in 2016 completion
31, 2016 interest in 2016 (%)
Suzhou Lvbang Plant 6,478,670.79 4,978,670.79 920,031.40 5,898,702.19 100% Self-raised
Kuwait tower cranes 5,298,257.45 5,038,257.45 202,074.12 4,664,068.70 576,262.87 100% Self-raised
Total 11,776,928.24 10,016,928.24 1,122,105.52 10,562,770.89 576,262.87
5.12 Intangible assets
5.12.1 Intangible assets
Item Land use right Software Total
1. Original book value
(1) Balance as at January 1, 2016 7,714,044.00 2,395,059.29 10,109,103.29
(2) Increase in 2016 100,906,958.59 2,021,556.78 102,928,515.37
- Purchase 1,073,583.44 1,073,583.44
-Internal research and development - - -
- Increase due to business combinations 100,906,958.59 947,973.34 101,854,931.93
(3) Decrease in 2016 - - -
- Disposal - - -
(4) Balance as at December 31, 2016 108,621,002.59 4,416,616.07 113,037,618.66
2. Accumulated amortization - - -
(1) Balance as at January 1, 2016 181,202.41 660,154.55 841,356.96
(2) Increase in 2016 4,873,410.93 1,119,407.22 5,992,818.15
- Provision 354,160.54 755,571.31 1,109,731.85
- Increase due to business combinations 4,519,250.39 363,835.91 4,883,086.30
(3) Decrease in 2016
- Disposal
(4) Balance as at December 31, 2016 5,054,613.34 1,779,561.77 6,834,175.11
3. Provision for impairment - - -
Notes to the Financial Statements Page 38
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Item Land use right Software Total
(1) Balance as at January 1, 2016 - - -
(2) Increase in 2016
- Provision
(3) Decrease in 2016 - - -
- Disposal - - -
(4) Balance as at December 31, 2016 - - -
4. Book value - - -
(1) Book value as at December 31, 2016 103,566,389.25 2,637,054.30 106,203,443.55
(2) Book value as at January 1, 2016 7,532,841.59 1,734,904.74 9,267,746.33
5.12.2 Land use right with pending certificate of title
There was no land use right with pending certificate of title in 2016.
5.13 Goodwill
5.13.1 Original book value of goodwill
Decrease in
Balance as at Increase in 2016
2016 Balance as at
Name of the investee or matters forming goodwill January 1,
Formed from business December 31, 2016
2016 Disposal
combinations
Shenzhen Yatian Decoration Design Engineering Co., Ltd. 6,724,316.91 6,724,316.91
Wuhan Commercial Workers Hospital Co., Ltd. 27,257,314.49 27,257,314.49
Sino Great Wall Southwest Construction Engineering Co., Ltd. 17,948,978.53 17,948,978.53
Sino Great Wall Jianyee Engineering Co., Ltd. 6,943,534.86 6,943,534.86
Total 6,724,316.91 52,149,827.88 - 58,874,144.79
Remarks: 1. Natural person Pan Huan and the Company's wholly-owned subsidiary Sino Great Wall International Engineering Co., Ltd.
signed an Equity Transfer Agreement on November 25, 2015. Pan Huan transferred 70% of his equities held in Shenzhen Yatian Decoration
Design Engineering Co., Ltd. to Sino Great Wall International Engineering Co., Ltd.. After the transfer, the Company's wholly-owned
subsidiary Sino Great Wall International Engineering Co., Ltd. held 70% of equities in Shenzhen Yatian Decoration Design Engineering Co.,
Ltd.. The price for the transfer of 70% of equities in Shenzhen Yatian Decoration Design Engineering Co., Ltd. by the Company's
wholly-owned subsidiary Sino Great Wall International Engineering Co., Ltd. was RMB 4 million. The Company's wholly-owned subsidiary
Sino Great Wall International Engineering Co., Ltd. takes November 25, 2015 as the acquisition date and total combination costs on the
acquisition date are RMB 4 million. The difference between RMB-2,724,316.91, namely the fair value of identifiable net assets of 70% of the
equities in Shenzhen Yatian Decoration Design Engineering Co., Ltd. acquired by the Company's wholly-owned subsidiary Sino Great Wall
International Engineering Co., Ltd. on the acquisition date, and the combination costs was RMB 6,724,316.91, which should be included in
goodwill.
Notes to the Financial Statements Page 39
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
2. On May 1, 2016, Wuhan Shangzhi Hospital Co., Ltd. and its management shareholders signed a Contract on Equity Transfer and Asset
Acquisition with the Company, specifying that Wuhan Shangzhi Hospital Co., Ltd. and its management shareholders transfer 100% of equities
in Wuhan Shangzhi Hospital Co., Ltd. to the Company. After the equity transfer, the Company owned 100% of equities in Wuhan Commercial
Workers Hospital Co., Ltd.. The consideration of the Company for 100% of equities transferred by Wuhan Commercial Workers Hospital Co.,
Ltd. was RMB 97 million. The Company took June 21, 2016 as the acquisition date. Total combination costs on the acquisition date were
RMB 97 million. The difference between RMB 69,742,685.51, namely the fair value of identifiable net assets of 100% of the equities in
Wuhan Shangzhi Hospital Co., Ltd. acquired by the Company on the acquisition date, and the combination costs was RMB 27,257,314.49,
which should be included in goodwill.
3. Natural persons Ye Jiajun and Zhang Shizhong signed an Equity Transfer Agreement with the Company on July 27, 2016. Ye Jiajun and
Zhang Shizhong transferred 100% of his equities held in Sichuan Dinghui Construction Co., Ltd. to Sino Great Wall International Engineering
Co., Ltd.. After the transfer, the Company's wholly-owned subsidiary Sino Great Wall International Engineering Co., Ltd. held 100% of
equities in Sichuan Dinghui Construction Co., Ltd.. The price made by the Company's wholly-owned subsidiary Sino Great Wall International
Engineering Co., Ltd. for receiving 100% of equities in Sichuan Dinghui Construction Co., Ltd. was RMB 18 million. The Company took
August 9, 2016 as the acquisition date. Total combination costs on the acquisition date were RMB 18 million. The difference between RMB
51,021.47, namely the fair value of identifiable net assets of 100% of the equities in Sichuan Dinghui Construction Co., Ltd. acquired by the
Company, and the combination costs was RMB 17,948,978.53, which should be included in goodwill. After the acquisition, Sichuan Dinghui
Construction Co., Ltd. was renamed Sino Great Wall Southwest Construction Engineering Co., Ltd..
4. Sichuan Haoyao Constructional Engineering Co., Ltd. and its parent company Chengdu Ruihe Hongsheng Technology Co., Ltd. signed an
Agreement on Increase in Capital and Share with the Company's wholly-owned subsidiary Sino Great Wall International Engineering Co., Ltd.
on November 9, 2016. They transferred 60% of their equities held in Sichuan Haoyao Constructional Engineering Co., Ltd. to Sino Great Wall
International Engineering Co., Ltd.. After the transfer, the Company's wholly-owned subsidiary Sino Great Wall International Engineering Co.,
Ltd. held 60% of equities in Sichuan Haoyao Constructional Engineering Co., Ltd.. The price made by the Company's wholly-owned
subsidiary Sino Great Wall International Engineering Co., Ltd. for receiving 60% of equities in Sichuan Haoyao Constructional Engineering
Co., Ltd. was RMB 90 million. The Company took November 11, 2016 as the acquisition date. Total combination costs on the acquisition date
were RMB 90 million. The difference between RMB 83,056,465.14, namely the fair value of identifiable net assets of 60% of the equities in
Sichuan Haoyao Constructional Engineering Co., Ltd. acquired by the Company on the acquisition date, and the combination costs was RMB
6,943,534.86, which should be included in goodwill.
Notes to the Financial Statements Page 40
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
5.14 Long-term deferred expenses
Balance as at Increase in Amortization in Balance as at
Item Other decreases
January 1, 2016 2016 2016 December 31, 2016
Renovation costs 14,879,816.11 2,567,004.36 5,418,620.60 - 12,028,199.87
Overseas guarantee fees 19,747,240.18 1,856,356.88 13,165,818.10 - 8,437,778.96
Subtotal 34,627,056.29 4,423,361.24 18,584,438.70 - 20,465,978.83
Less: long-term borrowings maturing
within one year 15,717,270.60 13,462,942.89
Total 18,909,785.69 7,003,035.94
5.15 Deferred income tax assets and deferred income tax liabilities
5.15.1 Deferred income tax assets without offset
Balance as at December 31, 2016 Balance as at January 1, 2016
Deductible Deductible
Item Deferred tax Deferred tax
temporary temporary
assets assets
differences differences
Provision for asset
impairment 484,110,666.81 74,623,400.23 308,401,589.95 46,440,178.39
Deductible losses 2,265,150.21 566,287.55 4,729,047.45 1,171,953.41
Inventory provision 6,456,633.28 1,108,971.56 1,352,585.08 338,146.27
Total 492,832,450.30 76,298,659.34 314,483,222.48 47,950,278.07
5.15.2 Deferred income tax liabilities without offset
Balance as at December 31, 2016 Balance as at January 1, 2016
Taxable Deferred Taxable Deferred
Item
temporary income tax temporary income tax
differences liabilities differences liabilities
Gains from changes in fair
value of financial assets
measured at fair value
through profit and loss 102,961.04 15,444.16
Value increment of assets
due to combinations not
under common control by
evaluation 109,879,555.06 27,469,888.77
Total 109,879,555.06 27,469,888.77 102,961.04 15,444.16
5.15.3 Details of unrecognized deferred income tax assets
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Deductible temporary differences 1,761,048.62
Deductible losses 29,368,743.01
Total 31,129,791.63
5.16 Other non-current assets
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
PPP project investment 48,960,000.00
Advances for purchase of long-term assets 67,942,258.30 95,353,390.28
Total 116,902,258.30 95,353,390.28
Notes to the Financial Statements Page 41
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
1. Details of equity investments of PPP project companies
Registered Subscribed Increase Balance as at
Shareho Balance as at
capital contributions in 2016 Decrease December 31,
Item lding January 1,
(RMB (RMB (RMB in 2016 2016 (RMB
ratio 2016
'0,000) '0,000) '0,000) '0,000)
Luyi Shuguang Medical
Industrial Investment and
Construction Co., Ltd. 9,600.00 4,896.00 51.00% 4,896.00 4,896.00
Total 9,600.00 4,896.00 4,896.00 4,896.00
5.17 Short-term borrowings
5.17.1 Short-term borrowings
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Guaranteed borrowings 1,621,515,110.00 210,000,000.00
Commercial acceptance bills endorsed or
discounted but not expired on the balance sheet
date 344,543,247.59 15,408,496.07
Total 1,966,058,357.59 225,408,496.07
1. Notes to short-term borrowings:
See Note 10.4 "Related-party transactions" for the related-party guarantee for short-term
borrowings.
2. There were no outstanding short-term borrowings due as at December 31, 2016.
5.18 Notes payable
Balance as at Balance as at
Type
December 31, 2016 January 1, 2016
Bank acceptance bill 397,450,000.00 143,410,167.17
Commercial acceptance bill 309,433,375.54
Total 706,883,375.54 143,410,167.17
Total notes payable due but unpaid as at December 31, 2016 were RMB 0.00.
The amount of notes that will expire in next accounting period was RMB 706,883,375.54.
5.19 Accounts payable
5.19.1 Presentation of accounts payable:
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Payments for projects 1,295,611,654.20 1,331,950,114.27
Payments for purchase of long-term
assets 7,923,625.18 669,840.50
Payment for purchase of medicines 10,413,710.87
Total 1,313,948,990.25 1,332,619,954.77
5.19.2 Significant accounts payable with aging over one year:
Balance as at
Reasons for failure of repayment or
Item December 31,
carry-forward
2016
Before the
CUMMINSQATAR RMB 914,723.58 for those within 1 year settlement
LLC 11,660,032.30 and RMB 10,745,308.72 within 1-2 years period
Notes to the Financial Statements Page 42
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Balance as at
Reasons for failure of repayment or
Item December 31,
carry-forward
2016
GULF
REINFORCEMEN Before the
T STEEL CO. RMB 658955.18 for those within 1 year settlement
W.L.L 10,424,868.23 and RMB 9,765,913.05 within 1-2 years period
Before the
Rezayat Trading Co. settlement
Limited 10,782,975.37 RMB 10,782,975.37 within 1-2 years period
RMB 11,975,790.38 for those within 1 Before the
CHHE GROUP year and RMB 12,588,011.67 within 1-2 settlement
CO.,LTD 24,563,802.05 years period
Total 57,431,677.95 /
5.20 Advances from customers
5.20.1 Presentation of advances from customers
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Payments for projects 572,743,695.28 64,963,842.60
Advances for medical services 1,040,377.30
Total 573,784,072.58 64,963,842.60
5.21 Employee compensation payable
5.21.1 Presentation of employee compensation payable
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2016 2016
2016 2016
Short-term compensation 11,696,032.04 337,653,647.65 331,711,930.27 17,637,749.42
Post-employment benefits -
defined contribution plans 973,587.16 13,708,204.80 13,521,994.69 1,159,797.27
Total 12,669,619.20 351,361,852.45 345,233,924.96 18,797,546.69
5.21.2 Presentation of short-term compensation
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2016 2016
2016 2016
(1) Salaries, bonuses,
allowances and subsidies 10,957,918.68 303,347,680.62 297,388,634.57 16,916,964.73
(2) Employee welfare - 14,636,878.07 14,636,878.07 -
(3) Social insurance
premiums 678,746.36 9,768,469.65 9,826,271.31 620,944.70
Including: medical
insurance premiums 567,258.19 8,753,518.62 8,804,708.07 516,068.74
Work-related injury
insurance premium 48,777.45 300,584.33 322,991.86 26,369.92
Maternity insurance
premiums 62,710.72 714,366.70 698,571.38 78,506.04
(4) Housing provident funds 59,367.00 8,386,377.05 8,345,904.06 99,839.99
(5) Labor union funds and
employee education funds - 1,514,242.26 1,514,242.26 -
Total 11,696,032.04 337,653,647.65 331,711,930.27 17,637,749.42
5.21.3 Presentation of defined contribution plans
Notes to the Financial Statements Page 43
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Balance as at Balance as at
Increase in Decrease in
Item January 1, December 31,
2016 2016
2016 2016
Basic endowment insurance
premiums 928,655.00 13,138,845.28 12,936,675.43 1,130,824.85
Unemployment insurance
premium 44,932.16 569,359.52 585,319.26 28,972.42
Total 973,587.16 13,708,204.80 13,521,994.69 1,159,797.27
5.22 Taxes and surcharges payable
Balance as at Balance as at
Taxes and surcharges
December 31, 2016 January 1, 2016
Value-added tax 12,062,605.90 367,314.45
Business tax 83,297,969.10 99,853,626.46
Enterprise income tax 207,849,865.19 172,280,720.23
Individual income tax 1,515,889.41 545,880.47
Urban maintenance and construction tax 4,725,964.11 6,413,578.69
Education surtax 3,694,729.45 5,106,621.62
Stamp tax and other taxes 336,646.62 258,548.19
Total 313,483,669.78 284,826,290.11
5.23 Interest payable
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Interest payable on short-term borrowings 4,710,255.00 330,945.21
Interest payable on long-term borrowings 1,718,238.55 197,024.05
Total 6,428,493.55 527,969.26
5.24 Other payables
5.24.1 Other payables by nature
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Bidding margins, performance bonds
and deposits 26,582,761.45 19,625,824.93
Current accounts between individuals
and withholding payables 45,650,286.49 42,269,479.45
Lendings to shareholders - 523,963,781.16
Current accounts between entities 136,613,997.74 49,313,976.16
Others 1,067,929.33 27,914.90
Payments for subscribing shares issued
privately 12,500,000.00
Total 222,414,975.01 635,200,976.60
5.24.2 Other significant payables with aging over one year
Reasons for failure
Balance as at
Item of repayment or
December 31, 2016
carry-forward
Shenzhen Qunguangshun Construction
Labor Co., Ltd. 31,500,000.00 Unexpired yet
Total 31,500,000.00
Notes to the Financial Statements Page 44
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
5.25 Non-current liabilities maturing within one year
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Long-term borrowings maturing within one year 175,958,998.04 7,135,752.00
Total 175,958,998.04 7,135,752.00
5.26 Other current liabilities
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Output tax to be carried forward 30,382,980.72
Total 30,382,980.72
5.27 Long-term borrowings
5.27.1 Classification of long-term borrowings
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
Pledged borrowings 500,000,000.00 19,480,800.00
Mortgage borrowings 3,175,860.22 10,659,849.14
Guaranteed borrowings 283,683,018.60
Total 786,858,878.82 30,140,649.14
5.28 Estimated liabilities
Balance as at Balance as at
Item Reasons for the formation
December 31, 2016 January 1, 2016
Provision for pending
Pending litigation 13,225,861.70 litigation of the Company
Total 13,225,861.70 /
5.29 Share capital
Increase/Decrease in 2016
Balance as at Balance as at
Issuance Reserves
Item January 1, Bonus December 31,
of new transferred to Others Subtotal
2016 shares 2016
shares share capital
Total amount of
shares 446,906,582.00 1,251,338,429.00 1,251,338,429.00 1,698,245,011.00
5.30 Capital reserve
Balance as at Balance as at
Item Increase in 2016 Decrease in 2016
January 1, 2016 December 31, 2016
Capital premium (share
premium) 394,052,904.72 1,251,338,429.00 -857,285,524.28
Other capital reserves -444,420,766.94 2,356,589.48 -442,064,177.46
Total -50,367,862.22 2,356,589.48 1,251,338,429.00 -1,299,349,701.74
Remark: Increase in other capital reserves of RMB 2,356,589.48 in 2016 was capital reserves
increased due to accounting of interest of borrowings of the controlling shareholders and
associated natural persons to the Company according to the equity transactions; The capital
reserves conversed into share capital of RMB 1,251,338,429.00 in 2016 were the decrease of
capital reserves in 2016.
5.31 Special reserve
Balance as at Balance as at
Item Increase in 2016 Decrease in 2016
January 1, 2016 December 31, 2016
Work safety costs 46,014,941.54 56,095,547.05 36,422,620.45 65,687,868.14
Total 46,014,941.54 56,095,547.05 36,422,620.45 65,687,868.14
Notes to the Financial Statements Page 45
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
5.32 Surplus reserve
Balance as at Balance as at
Item Increase in 2016 Decrease in 2016
January 1, 2016 December 31, 2016
Statutory surplus reserves 84,394,441.23 84,394,441.23
Total 84,394,441.23 84,394,441.23
5.33 Undistributed profits
Item Year 2016 Year 2015
Undistributed profits as at the end of last period
before adjustment 755,308,636.19 443,707,019.71
Adjustment to total undistributed profits at the
beginning of the year ("+" for increase and "-" for
decrease)
Undistributed profits at the beginning of the year
after adjustment 755,308,636.19 443,707,019.71
Plus: net profit attributable to owners of the parent
company in the year 473,661,862.67 346,648,651.48
Less: withdrawal of statutory surplus reserves 35,047,035.00
Others
Undistributed profits at the end of the year 1,228,970,498.86 755,308,636.19
5.34 Operating income and operating cost
Amount in 2016 Amount in 2015
Item
Income Cost Income Cost
Primary business 4,662,402,374.17 3,459,377,744.66 4,010,300,741.19 3,165,027,185.66
Other business 2,596,743.00 - 58,258.39
Total 4,664,999,117.17 3,459,377,744.66 4,010,358,999.58 3,165,027,185.66
5.35 Business taxes and surcharges
Item Amount in 2016 Amount in 2015
Business tax 8,128,747.41 71,137,330.61
Urban maintenance and construction tax 597,022.91 4,552,568.01
Education surtax 478,975.13 3,795,770.42
Other taxes 446,784.01
Total 9,651,529.46 79,485,669.04
5.36 Selling expenses
Item Amount in 2016 Amount in 2015
Employee compensation 6,623,108.93 7,480,826.85
Travel expenses 934,104.49 1,055,919.35
Entertainment expenses 469,366.01 898,779.78
Advertising and promotion expenses 2,675.00 155,680.00
Engineering maintenance fees 17,911,593.82 1,431,742.98
Others 4,377,840.02 2,663,223.14
Total 30,318,688.27 13,686,172.10
Notes to the Financial Statements Page 46
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
5.37 General and administrative expenses
Item Amount in 2016 Amount in 2015
Employee compensation 127,039,183.19 87,117,818.35
Office costs 9,544,489.51 6,241,300.07
Rental fees 19,084,430.19 12,393,307.35
Travel expenses 12,096,343.79 5,350,149.45
Entertainment expenses 9,828,496.48 6,462,222.69
Depreciation of fixed assets 6,848,917.76 2,339,244.07
Vehicle costs 2,871,639.42 2,586,923.27
Amortization of long-term deferred expenses 4,308,529.48 4,844,357.87
Consulting fees 79,559,745.78 10,069,218.74
Conference expenses 156,486.46 136,778.15
Others 42,592,471.50 17,021,007.85
Total 313,930,733.56 154,562,327.86
5.38 Financial expenses
Category Amount in 2016 Amount in 2015
Interest expenses 130,325,289.46 45,919,707.78
Less: Interest income 3,936,374.12 1,654,394.40
Gains or losses on exchange -75,709,807.87 -7,285,087.59
Discount interest 19,445,217.45 4,863,792.26
Handling charges and others 57,312,903.03 13,022,383.97
Total 127,437,227.95 54,866,402.02
5.39 Losses from asset impairment
Item Amount in 2016 Amount in 2015
Losses on bad debts 164,907,841.91 109,984,519.09
Losses on inventory depreciation 5,104,048.20 1,352,585.08
Total 170,011,890.11 111,337,104.17
5.40 Gains from changes in fair value
Source of the gains from changes in fair value Amount in 2016 Amount in 2015
Financial assets measured at fair value through
current profit and loss 42,553.26
Total 42,553.26
5.41 Investment income
Item Amount in 2016 Amount in 2015
Income from long-term equity investments accounted
for under equity method -
Investment income from disposal of long-term equity
investments -
Investment income received from financial assets
measured at fair value through current profit and loss
during the holding period -
Investment income received from disposal of
financial assets measured at fair value through
current profit and loss 13,448.02
Investment income from held-to-maturity
investments during the holding period -
Investment income of available-for-sale financial
assets during the holding period -
Notes to the Financial Statements Page 47
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Item Amount in 2016 Amount in 2015
Investment income from disposal of
available-for-sale financial assets -
Gains and losses arising from re-measurement of the
remaining equities at the fair value after the loss of
the control -
Others 2,212,902.95
Total 2,226,350.97
5.42 Non-operating income
Amount included in
Item Amount in 2016 Amount in 2015 non-recurring gains and
losses in 2016
Total gains from disposal of non-current
assets 4,455.00
Including: gains from disposal of fixed assets 4,455.00
Government grants 108,121.33 342,246.00 108,121.33
Others 26,318,921.53 34,032.08 26,318,921.53
Total 26,427,042.86 380,733.08 26,427,042.86
Government subsidies included in current profit and loss
Item Amount in 2016 Amount in 2015 Related to assets/income
Rewards for headquarter-mode enterprises
that have made investments in Tongzhou 72,365.00 342,246.00 Related to income
Post subsidy 35,756.33 Related to income
Total 108,121.33 342,246.00 /
5.43 Non-operating expenses
Amount included in
Item Amount in 2016 Amount in 2015 non-recurring gains and
losses in 2016
Total losses from disposal of non-current
assets 564,833.40 85,567.15 564,833.40
Including: losses on disposal of fixed assets 564,833.40 85,567.15 564,833.40
Foreign donations
Others 21,022,106.88 939,828.42 21,022,106.88
Total 21,586,940.28 1,025,395.57 21,586,940.28
5.44 Income tax expenses
5.44.1 Statement of income tax expenses
Item Amount in 2016 Amount in 2015
Current income tax expenses 115,052,974.76 82,948,121.72
Deferred income tax expenses -25,808,113.01 1,740,767.09
Total 89,244,861.75 84,688,888.81
5.44.2 Adjustment process of accounting profits and income tax expenses
Item Amount in 2016
Total profit 561,337,756.70
Income tax expenses calculated at the statutory [or applicable]
tax rate 140,334,439.18
Effect of different tax rate applicable to subsidiaries 1,009,583.31
Effect of adjustment on income tax in previous periods
Effect of tax-exempt income
Effect of non-deductible costs, expenses and losses 42,837,964.72
Notes to the Financial Statements Page 48
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Item Amount in 2016
Effect of deductible losses from using deferred income tax assets
unrecognized in previous periods
Effect of deductible temporary differences or deductible losses
from deferred income tax assets unrecognized in the current
period 7,242,029.39
Income tax expenses 89,244,861.75
5.45 Items in the statement of cash flows
5.45.1 Cash received from other operating activities
Item Amount in 2016 Amount in 2015
Interest income 3,936,374.12 1,654,394.40
Margin, deposit and other current accounts 1,814,618,138.18 1,372,680,802.86
Government grants 108,121.33 342,246.00
Total 1,818,662,633.63 1,374,677,443.26
5.45.2 Cash paid for other operating activities
Item Amount in 2016 Amount in 2015
Handling charges 15,515,853.49 17,871,746.12
Margin and deposit expenses 117,417,474.74 65,681,623.08
Selling expenses 23,695,579.34 5,708,228.19
General and administrative expenses 175,125,500.48 58,197,102.84
Current accounts 2,657,532,011.53 1,490,471,903.13
Total 2,989,286,419.58 1,637,930,603.36
5.45.3 Cash received from other investing activities
Item Amount in 2016 Amount in 2015
Individual financing funds received 162,855,000.00 779,900,000.00
Non-public deposits 12,500,000.00
Total 175,355,000.00 779,900,000.00
5.45.4 Cash paid for other financing activities
Item Amount in 2016 Amount in 2015
Note margin - 46,903,589.64
Individual financing funds 530,980,295.84 328,378,111.24
Trust deposits 2,000,000.00
Financing fees 22,800,000.00
Total 555,780,295.84 375,281,700.88
5.46 Supplementary information to the statement of cash flows
5.46.1 Supplementary information to the statement of cash flows
Supplementary information Year 2016 Year 2015
1. Net profit adjusted to cash flows from
operating activities
Net profit 472,092,894.95 346,103,140.68
Plus: provision for asset impairment 170,011,890.11 111,337,104.17
Depreciation of fixed assets and others 8,868,947.59 3,522,849.96
Amortization of intangible assets 1,109,731.85 627,434.01
Amortization of long-term deferred
expenses 18,584,438.70 12,313,310.96
Losses on disposal of fixed assets,
intangible assets and other long-term assets
("-" for gains) 564,833.40 81,112.15
Notes to the Financial Statements Page 49
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Supplementary information Year 2016 Year 2015
Losses on write-off of fixed assets (“-” for
gains)
Losses from changes in fair value ("-" for
gains) -42,553.26
Financial expenses ("-" for gains) 136,256,259.56 38,634,620.19
Investment loss ("-" for gains) 2,226,350.97 -
Decreases in deferred income tax assets ("-"
for increases) 1,646,331.60 1,741,109.30
Increases in deferred income tax liabilities
("-" for decreases) -27,454,444.61 -342.21
Decreases in inventories ("-" for increases) -148,243,275.45 -134,526,054.06
Decreases in operating receivables (“-” for
increases) -2,878,862,492.67 -867,621,315.78
Decreases in operating payables ("-" for
decreases) 555,322,720.06 195,778,326.80
Others
Net cash flows from operating activities -1,687,875,813.94 -292,051,257.08
2. Significant investing and financing
activities not involving cash inflows and
outflows
Conversion of debt into capital
Convertible corporate bonds due within one
year
Fixed assets acquired under financial lease
3. Net change in cash and cash equivalents
Ending balance of cash 943,705,322.41 582,745,756.81
Less: Beginning balance of cash 582,745,756.81 243,759,954.90
Plus: Ending balance of cash equivalents
Less: Beginning balance of cash
equivalents
Net increase in cash and cash equivalents 360,959,565.60 338,985,801.91
5.46.2 Net cash paid for acquisition of subsidiaries in 2016
Amount
Cash or cash equivalents paid in 2016 for business combinations
incurred in 2016 110,000,000.00
Less: cash and cash equivalents held by subsidiaries on the
acquisition date 67,532,263.39
Plus: Cash or cash equivalents paid in 2016 for business
combinations in previous periods
Net cash paid for acquisition of subsidiaries 42,467,736.61
5.46.3 Breakdowns of cash and cash equivalents
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
I. Cash 943,705,322.41 582,745,756.81
Including: cash on hand 2,974,883.16 1,349,587.20
Unrestricted bank deposit 940,730,439.25 343,390,159.56
Other unrestricted monetary funds 238,006,010.05
II. Cash equivalents
III. Balance of cash and cash equivalents
as at December 31, 2016 943,705,322.41 582,745,756.81
Including: cash and cash restricted for
Notes to the Financial Statements Page 50
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Balance as at Balance as at
Item
December 31, 2016 January 1, 2016
use by the parent company or
subsidiaries within the group
5.47 Restricted assets
Book value as at
Item -Reason for restriction
December 31, 2016
Cash and cash equivalents 397,110,499.42 Deposits
Notes receivable 98,645,997.87 Pledge
Balance of accounts receivables 1,509,610,147.37 Pledge
Total 2,005,366,644.66
5.48 Monetary items in foreign currency
5.48.1 Monetary items in foreign currency
Balance in foreign RMB balance
Exchange
Item currency as at translated as at
rate
December 31, 2016 December 31, 2016
Cash and cash
equivalents 1,088,130,877.82
Including: USD 154,220,972.45 6.9370 1,069,830,885.89
GBP 1,000.00 8.5094 8,509.40
HKD 1,525,578.86 0.8945 1,364,645.55
QAR 82,452.21 1.9051 157,078.79
THB 50,000.00 0.1937 9,684.67
INR 292,646,802.97 0.0463 13,552,008.49
PHP 122,867.99 0.1402 17,224.11
MYR 284,472.84 1.5527 441,686.76
KWD 116,796.90 22.6588 2,646,480.79
BUK 1,590,000.00 0.0051 8,109.00
MOP 108,932.37 0.8681 94,564.37
Accounts receivable 2,062,888,319.06
Including: USD 109,812,714.10 6.9370 761,770,797.71
QAR 159,572,978.97 1.9051 304,000,701.70
INR 1,149,337,736.29 0.0463 53,224,004.52
PHP - 0.1402 -
MYR 42,494,611.37 1.5527 65,979,258.34
MOP 1,362,817.67 0.8681 1,183,064.22
DZD 24,867,193.21 0.0626 1,557,808.06
KWD 38,623,917.74 22.6588 875,172,684.51
Advances to
suppliers 96,686,246.86
Including: USD 2,587,704.72 6.9370 17,950,907.64
QAR 21,321,042.22 1.9051 40,618,479.63
INR 8,026,046.66 0.0463 371,673.47
KWD 1,665,804.92 22.6588 37,745,186.12
Other receivables 148,838,337.87
Including: USD 13,048,500.31 6.9370 90,517,446.65
HKD 15,150.00 0.8945 13,551.83
MOP - 0.8681 -
INR 25,540,450.43 0.0463 1,182,737.68
MYR 462,804.74 1.5527 718,573.78
PHP 116,997.00 0.1402 16,401.10
Notes to the Financial Statements Page 51
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Balance in foreign RMB balance
Exchange
Item currency as at translated as at
rate
December 31, 2016 December 31, 2016
QAR 15,675,667.09 1.9051 29,863,538.46
THB 1,022,031.04 0.1937 197,960.61
KWD 1,149,993.31 22.6588 26,057,499.89
DZD 3,361,846.96 0.0626 210,603.27
BUK 11,841,381.00 0.0051 60,024.60
Accounts payable 615,773,811.43
Including: USD 42,867,884.62 6.9370 297,374,515.61
QAR 51,783,417.59 1.9051 98,652,011.05
INR 364,688,798.76 0.0463 16,888,158.86
PHP 44,130.43 0.1402 6,186.38
MYR 16,300,996.89 1.5527 25,309,742.82
KWD 7,536,594.55 22.6588 170,770,394.88
BUK 1,336,107,728.00 0.0051 6,772,801.83
Advances from
customers 31,893,381.65
Including: USD 1,524,015.00 6.9370 10,572,092.06
EUR 1,998,722.68 7.3068 14,604,266.88
HKD - 0.8945 -
DZD 107,223,416.22 0.0626 6,717,022.71
Other payables 80,390,994.02
Including: USD 10,134,042.51 6.9370 70,299,852.89
HKD - 0.8945 -
QAR 500,339.30 1.9051 953,190.82
INR 42,167,275.30 0.0463 1,952,699.52
PHP 8,447.15 0.1402 1,184.15
DZD 126,262.63 0.0626 7,909.74
KWD 316,704.69 22.6588 7,176,156.90
Notes to the Financial Statements Page 52
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
6. Changes in the scope of consolidation
6.1 Business combinations not under common control
6.1.1 Business combinations not under common control in 2016
Revenue of the Net profit of the
Costs for Proportion of Method of Recognition acquiree from the acquiree from the
Timing of acquisition
Acquiree acquisition of equities acquired acquisition of Acquisition date basis of the acquisition date to acquisition date
of equities
equities (%) equities acquisition date December 31, to December 31,
2016 2016
Wuhan Commercial Workers Hospital Acquisition of
Co., Ltd. June 21, 2016 97,000,000.00 100 Acquisition June 21, 2016 control 82,027,233.44 3,120,181.28
Sino Great Wall Southwest Acquisition of
Construction Engineering Co., Ltd. August 9, 2016 18,000,000.00 100 Acquisition August 9, 2016 control 14,967,733.16 426,158.33
Sino Great Wall Jianyee Engineering Increase in capital Acquisition of
Co., Ltd. November 11, 2016 90,000,000.00 60 and share November 11, 2016 control 102,593,058.61 541,256.23
6.1.2 Combination cost and goodwill
Wuhan
Sino Great Wall Sino Great Wall
Commercial
Southwest Construction Jianyee Engineering
Workers Hospital
Engineering Co., Ltd. Co., Ltd.
Co., Ltd.
Combination cost
- Cash 97,000,000.00 18,000,000.00 90,000,000.00
- Fair value of non-cash assets - - -
-Fair value of liabilities issued or assumed - - -
-Fair value of equity securities issued - - -
-Fair value of contingent consideration - - -
- Fair value of equities held before the acquisition date on the
acquisition date - - -
- Others - - -
Total combination costs 97,000,000.00 18,000,000.00 90,000,000.00
Less: share of fair value of identifiable net assets acquired 69,742,685.51 51,021.47 83,056,465.14
Amount of goodwill/combination cost less than the share of fair
value of identifiable net assets acquired 27,257,314.49 17,948,978.53 6,943,534.86
Notes to the Financial Statements Page 53
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
6.1.3 Identifiable assets and liabilities of the acquiree on the acquisition date
(Unit: RMB '0,000)
Sino Great Wall Southwest
Wuhan Commercial Sino Great Wall Jianyee
Construction Engineering
Workers Hospital Co., Ltd. Engineering Co., Ltd.
Co., Ltd.
Fair value Book value Fair value on Book value Fair value on Book value
on the on the the on the the on the
acquisition acquisition acquisition acquisition acquisition acquisition
date date date date date date
Current assets 17,101.91 17,101.91 404.21 387.62 29,475.62 27,984.18
Non-current assets 14,056.60 2,552.97 4.15 307.19 679.46
Total assets: 31,158.51 19,654.88 404.21 391.77 29,782.81 28,663.64
Current liabilities 21,308.34 21,308.34 377.34 377.34 24,150.98 24,150.98
non-current liabilities - -
Total liabilities: 21,308.34 21,308.34 377.34 377.34 24,150.98 24,150.98
Net asset 9,850.17 -1,653.46 26.87 14.43 5,631.83 4,512.66
Less: minority equity - - 2,252.73 1,805.06
Net asset acquired 9,850.17 -1,653.46 26.87 14.43 3,379.10 2,707.60
Notes to the Financial Statements Page 54
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
6.2 Changes in the scope of consolidation for other reasons
1. The Company established a wholly-owned subsidiary in 2016 - SINO GREAT WALL
INTERNETIONAL ENGINEERING (CNMI) CO., LLC with registered capital of USD 1
million.
2. The Company established a wholly-owned subsidiary in 2016 - Sino Great Wall (Beijing)
Investment Management Co., Ltd. with registered capital of RMB 100 million.
3. The Company established a holding subsidiary in 2016 - Sino Great Wall Real Estate
(Hubei) Co., Ltd. with the shareholding ratio of 80% and the registered capital of RMB 100
million.
4. The Company established a holding subsidiary in 2016 - Sino Great Wall Development
(Hengqin) Co., Ltd. with the shareholding ratio of 85% and the registered capital of RMB
50 million.
5. The Company established a holding subsidiary in 2016 - PT.SINO GREAT WALL
INVESTMENT INDONESIA with the shareholding ratio of 99.9% and the registered
capital of IDR 520 billion.
6. The Company established a holding subsidiary in 2016 - PT.SINO GREAT WALL
CONSTRUCTION INDONESIA with the shareholding ratio of 67% and the registered
capital of IDR 150 billion.
7. The Company established a holding subsidiary in 2016 - SINO GREAT WALL
INTERNETIONAL ENGINEERING (MM) CO., LTD with the shareholding ratio of 80%
and the registered capital of USD 10 million.
8. The Company established a wholly-owned subsidiary in 2016 - Sino Great Wall New
Energy (Beijing) Co., Ltd. with registered capital of RMB 30 million.
9. The Company canceled a holding subsidiary in 2016 - Sino Heji Environmental Protection
Materials Co., Ltd.
7. Equity in other entities
7.1 Equity in subsidiaries
7.1.1 Structure of the enterprise group
Principal place Registered Nature of Shareholding ratio (%) Way of
Name of subsidiaries
of business place business Directly Indirectly acquisition
Sino Great Wall Medical
Investment Management Co., Medical Establishmen
Ltd. Beijing Beijing investment 100 t
Investment
management,
Sino Great Wall Infrastructure import and Establishmen
Investment Co., Ltd. Beijing Beijing export 100 t
Wuhan Commercial Workers
Hospital Co., Ltd. Wuhan Wuhan Health care 100 Acquisition
Sino Great Wall International
Engineering Co., Ltd. Beijing Beijing Decoration 100 Acquisition
Sino Great Wall Jianyee
Engineering Co., Ltd. (formerly
known as Sichuan Haoyao
Constructional Engineering Co.,
Ltd.) Chengdu Chengdu Construction 60 Acquisition
Notes to the Financial Statements Page 55
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Principal place Registered Nature of Shareholding ratio (%) Way of
Name of subsidiaries
of business place business Directly Indirectly acquisition
Investment
and property
management;
Sino Great Wall (Beijing) economy and
Investment Fund Management trade Establishmen
Co., Ltd. Beijing Beijing consulting 100 t
Sino Great Wall Real Estate Real estate Establishmen
(Hubei) Co., Ltd. Wuhan Wuhan development 80 t
Sino Great Wall New Energy New energy Establishmen
(Beijing) Co., Ltd. Beijing Beijing technology 100 t
Solar
Qian'an Sino Solar Power photovoltaic Establishmen
Generation Co., Ltd. Qian'an Qian'an power station 100 t
Solar
photovoltaic
Wu'an Juhe Photovoltaic Power power Establishmen
Generation Co., Ltd. Wu'an Wu'an generation 100 t
Bozhou Guangcheng New Solar power Establishmen
Energy Co., Ltd. Bozhou Bozhou generation 100 t
Bozhou Zhaosheng Agricultural Establishmen
Technology Co., Ltd. Bozhou Bozhou Agriculture 100 t
Bozhou Xieying Solar Power Solar power Establishmen
Generation Co., Ltd. Bozhou Bozhou generation 100 t
Shanghai Ling Rui International Establishmen
Trade Company Limited Shanghai Shanghai Trade 100 t
Investment,
research and
development
and sales,
trade as well
Shenzhen Hongtulve Industrial as import and Establishmen
Co., Ltd. Shenzhen Shenzhen export 100 t
Sino Great Wall Development Design and Establishmen
(Hengqin) Co., Ltd. Zhuhai Hengqin construction 85 t
Commercial
activities
SINO GREAT WALL (USA). The United The United allowed by Establishmen
INC States States law 100 t
Herabenna Interior Design Establishmen
Guangzhou Co., Ltd. Guangzhou Guangzhou Design 100 t
Mechanical
and electrical
engineering,
scientific
research,
trade and
Inrich Me Engineering Co., investment Establishmen
Limited Hong Kong Hong Kong consulting 100 t
Sino Great Wall Southwest
Construction Engineering Co.,
Ltd. (formerly known as Sichuan
Dinghui Construction Co., Ltd.) Chengdu Chengdu Construction 100 Acquisition
PT.SINO GREAT WALL Real estate or Establishmen
INVESTMENT INDONESIA Indonesia Indonesia lease 99.9 t
PT.SINO GREAT WALL Establishmen
CONSTRUCTION INDONESIA Indonesia Indonesia Construction 67 t
Notes to the Financial Statements Page 56
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Principal place Registered Nature of Shareholding ratio (%) Way of
Name of subsidiaries
of business place business Directly Indirectly acquisition
SINO GREAT WALL
INTERNETIONAL
ENGINEERING(CNMI)CO.,LL Design and Establishmen
C Saipan Saipan construction 100 t
Shenzhen Yatian Decoration Design and
Design Engineering Co., Ltd. Shenzhen Shenzhen construction 70 Acquisition
Sino Great Wall International
Engineering (MACAU) Co., Design and Establishmen
Limited Macao Macao construction 96 4 t
Construction,
design, trade
and
Sino Great Wall Group Co., investment Establishmen
Limited Hong Kong Hong Kong consulting 100 t
SGW HP
EngineeringConstructionSDN.B Design and Establishmen
HD Malaysia Malaysia construction 100 t
Building
SINO GREAT WALL construction
(PHILIPPINES) and import
INTERNATIONAL and export Establishmen
CORPORITION Philippines Philippines trade 100 t
Beijing Sino Great Wall Design and Establishmen
Decoration Design Co., Ltd. Beijing Beijing consulting 100 t
Suzhou Lvbang Wood Production Establishmen
Technology Co., Ltd. Suzhou Suzhou and sales 100 t
Sino Heji Environmental Production Establishmen
Protection Materials Co., Ltd. Heji Heji and sales 80 t
SINO GREAT WALL
INTERNETIONAL Design and Establishmen
ENGINEERING(MM)CO.,LTD Myanmar Myanmar construction 80 t
Sino Great Wall International Establishmen
Engineering (Thailand) Co., Ltd. Thailand Thailand 48.998 t
8. Risks associated with financial instruments
The Company faces various financial risks in the process of operation: credit risks, market risks and
liquidity risks. The Board of Directors of the Company shall be fully responsible for determining risk
management objectives and policies and bearing the ultimate liabilities for that. However, the Board of
Directors has authorized the management to design and implement the process that can ensure the
effective implementation of the risk management objectives and policies. The Board of Directors
reviews the effectiveness of the enforced procedures and the rationality of risk management objectives
and policies through monthly reports submitted by the management. Internal auditors of the Company
will also audit risk management policies and procedures and report the relevant findings to the audit
committee.
Overall objective of risk management of the Company is to formulate risk management policies to
minimize risks without undue prejudice to the Company's competitiveness and resilience.
8.1 Credit risk
Credit risk refers to a risk of financial losses suffered by one party of financial instruments due
to the failure of the other party to fulfill obligations. The Company mainly faces customer credit
risks caused by sales on account. Prior to the conclusion of a new contract, the Company will
evaluate the credit risk of the new customer, including external credit rating and bank reference
letter under some circumstances if the relevant information is available. The Company sets a
credit limit for each customer. The limit is the maximum amount unnecessary for additional
approval.
Notes to the Financial Statements Page 57
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
The Company quarterly monitors credit ratings of existing customers and monthly reviews aging
analysis of accounts receivable to ensure that the Company's overall credit risk is within the
controllable range. When the Company monitors credit risks of customers, the customers shall
be divided into groups according to their credit features. Customers rated as "high risk" will be
placed in a restricted customer list. The Company may sell goods to such customers on credit in
future periods subject to additional approval; otherwise the Company must require advance
payments.
8.2 Market risk
Market risk associated with financial instruments refers to the risk arising from changes in fair
value or future cash flows of financial instruments due to market price fluctuation, including
interest rate risk and foreign exchange risk.
(1) Interest rate risk
Interest rate risk refers to the risk arising from changes in fair value or future cash flows of
financial instruments due to fluctuation in market interest rate. The Company's interest rate
risk mainly derives from bank borrowings. The Company establishes good relations with
banks and reasonably designs credit lines, credit varieties and credit period to guarantee
sufficient bank credit lines and to meet short-term financing needs. By shortening the time
limit of a single loan, the Company may specifically agree terms of the prepayment to
reasonably reduce the risk of interest rate.
On December 31, 2016, in case other variables remain unchanged, if the loan interest rate
calculated at a floating interest rate rises or falls 100 basis points, the Company's net profit
will reduce or increase by RMB 21,200 (December 31, 2015: RMB 2,178,000).
(2) Exchange rate risk
Exchange rate risk refers to the risk arising from changes in fair value or future cash flows
of financial instruments due to fluctuation in foreign exchange rate. The Company shall
match foreign currency income and foreign currency expenses as much as possible to
minimize exchange rate risk. In addition, the Company may also sign forward foreign
exchange contracts or currency swap contracts to avoid exchange rate risks.
The exchange rate risk faced by the Company mainly derives from dollar-denominated
financial assets and financial liabilities. Foreign currency financial assets and financial
liabilities are converted into amount in RMB as follows:
Balance as at December 31, 2016 (RMB) Balance as at January 1, 2016 (RMB)
Item Other foreign Total Other foreign Total
USD USD
currencies currencies
Cash and cash equivalents 1,069,830,885.89 18,299,991.93 1,088,130,877.82 12,367,626.74 47,803,146.93 60,170,773.67
Accounts receivable 761,770,797.71 1,301,117,521.35 2,062,888,319.06 261,680,003.01 64,685,392.32 326,365,395.33
Advances to suppliers 17,950,907.64 78,735,339.22 96,686,246.86 3,219,710.57 21,727,760.68 24,947,471.25
Other receivables 90,517,446.65 58,320,891.22 148,838,337.87 19,653,509.31 61,363,486.93 81,016,996.24
Sub-total of assets 1,940,070,037.89 1,456,473,743.72 3,396,543,781.61 296,920,849.63 195,579,786.86 492,500,636.49
Accounts payable 297,374,515.61 318,399,295.82 615,773,811.43 121,182,379.88 321,046,692.24 442,229,072.12
Advances from customers 10,572,092.06 21,321,289.59 31,893,381.65 16,637,252.49 16,637,252.49
Other payables 70,299,852.89 10,091,141.13 80,390,994.02 2,005,010.46 3,042,262.65 5,047,273.11
Sub-total of liabilities 378,246,460.56 349,811,726.54 728,058,187.10 123,187,390.34 340,726,207.38 463,913,597.72
Net amount 1,561,823,577.33 1,106,662,017.18 2,668,485,594.51 173,733,459.29 -145,146,420.52 28,587,038.77
On December 31, 2016, in case all other variables remain unchanged, if RMB to USD
appreciates or depreciates by 1%, the net profits of the Company would reduce or increase
by RMB 15,618,200 (December 31, 2015: RMB 285,900).
Notes to the Financial Statements Page 58
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
8.3 Liquidity risk
Liquidity risk refers to a risk arising from shortage of funds when the Company performs the
obligations settled in cash or other financial assets. Policies of the Company are to ensure
sufficient cash to pay matured debts. Liquidity risk is under centralized control of the financial
department of the Company. The financial department monitors cash balance and readily
realizable and marketable securities and makes rolling forecast on cash flows of the next 12
months to ensure that the Company has sufficient funds to repay debts in all cases of reasonable
prediction. See disclosure of the relevant items of Note 5 for details of financial liabilities of the
Company presented at undiscounted contractual cash flows on the maturity date.
9. Related parties and related-party transactions
9.1 Actual controller of the Company
Shareholding ratio Voting ratio in
Amount of
Name in the Company the Company Remarks
shares held
(%) (%)
Chen Lve 582,944,556 34.33 34.33
9.2 Subsidiaries of the Company
See Note 7 Equity in other entities for subsidiaries of the Company.
9.3 Other related parties
Other related parties Relationship with the Company
Brother-in-law of the shareholder and actual controller of
He Sen the Company
Wife of the shareholder and actual controller of the
He Feiyan Company
Li Erlong etc. Directors, supervisors and senior officers of the Company
Qinghai Heyi Commercial Co., Enterprise controlled by Wang Lei, the director of the
Ltd. Company
Enterprise controlled by Wang Lei, the director of the
Qinghai Heyi Mining Co., Ltd. Company
Kunwu Jiuding Investment
Holdings Co., Ltd. and its Shareholders with 5% or above of shares of the Company
related parties and under common control
Beijing Baolilai Technology A wholly-owned subsidiary in which the Company's
Co., Ltd. director acts as a director
9.4 Related party transactions
9.4.1 Purchase or sale of goods, and rendering or receipt of labor services
Table of purchase of goods and receipt of labor services (Unit: RMB '0,000)
Amount in Amount in
Related parties Related party transactions
2016 2015
Qinghai Heyi Commercial
Co., Ltd. Payment for materials 1,959.00 4,636.50
Qinghai Heyi Mining Co.,
Ltd. Consulting fees 1,187.00
Notes to the Financial Statements Page 59
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Table of sales of goods and rendering of services (Unit: RMB '0,000)
Amount in Amount in
Related parties Related party transactions
2016 2015
Kunwu Jiuding
Investment Holdings Co., Funds for decoration
Ltd. and its related parties projects 795.13 5,800.00
Beijing Baolilai Funds for decoration
Technology Co., Ltd. projects 38.20 821.60
9.4.2 Related-party guarantee
The Company as the warrantee:
Have the
Starting date Maturity
Amount of the guarantee
Warrantor of the date of the
guarantee been
guarantee guarantee
performed?
Chen Lve and Sino Great Wall March 21, March 21,
Co., Ltd. 150,000,000.00 2016 2017 No
Chen Lve, Sino Great Wall Co., July 19,
Ltd. and He Feiyan 150,000,000.00 July 19, 2016 2017 No
August 8, August 8,
Sino Great Wall Co., Ltd. 50,000,000.00 2016 2017 No
Chen Lve and Zhongcheng June 3,
Jianyee Engineering Co., Ltd. 80,000,000.00 June 19, 2015 2016 Yes
Chen Lve and Sino Great Wall October 28, September
Co., Ltd. 130,000,000.00 2016 28, 2017 No
Chen Lve, He Feiyan and Sino November 19, November
Great Wall Co., Ltd. 50,000,000.00 2015 19, 2016 Yes
March 10, March 9,
Qinghai Heyi Mining Co., Ltd. 2016 2017 No
March 10, March 9,
Chen Lve 500,000,000.00 2016 2017 No
Chen Lve and Sino Great Wall December 19, December
Co., Ltd. 84,000,000.00 2016 19, 2017 No
January 13, January 13,
Chen Lve 12,000,000.00 2016 2018 No
March 29, March 29,
Chen Lve 12,000,000.00 2016 2018 No
March 27, March 27,
Chen Lve 12,000,000.00 2016 2018 No
United Venture Guarantee January 8, January 7,
Group Co., Ltd. 28,000,000.00 2016 2017 No
Great Wall Jianyee Engineering
Co., Ltd., Chen Lve and
Qinghai Heyi Commercial Co., January 20, January 19,
Ltd. 114,280,000.00 2015 2016 Yes
May 18,
Chen Lve and He Feiyan 140,000,000.00 June 11, 2015 2016 Yes
Chen Lve, Sino Great Wall Co., July 12,
Ltd. and He Feiyan 140,000,000.00 July 12, 2016 2017 No
Beijing Zhongguancun Sci-tech February 22, March 22,
Financing Guaranty Co., Ltd. 230,000,000.00 2016 2018 No
Chen Lve and Qinghai Heyi January 20, January 19,
Commercial Co., Ltd. 114,280,000.00 2015 2016 Yes
June 3,
Chen Lve 80,000,000.00 June 19, 2015 2016 Yes
June 3,
Chen Lve 80,000,000.00 June 19, 2015 2016 Yes
Notes to the Financial Statements Page 60
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Have the
Starting date Maturity
Amount of the guarantee
Warrantor of the date of the
guarantee been
guarantee guarantee
performed?
May 18,
Chen Lve and He Feiyan 140,000,000.00 June 11, 2015 2016 Yes
September 3, September
Chen Lve 70,000,000.00 2014 2, 2016 Yes
February 11, February
Chen Lve 11,000,000.00 2015 11, 2018 No
July 30,
Chen Lve 11,000,000.00 July 30, 2015 2018 No
Sino Great Wall International
Engineering Co., Ltd. and Chen January 13, January 12,
Lve 100,000,000.00 2016 2017 No
Sino Great Wall International
Engineering Co., Ltd., Chen January 13, January 12,
Lve and He Feiyan 120,000,000.00 2016 2017 No
Sino Great Wall International
Engineering Co., Ltd., Chen August 25, August 25,
Lve and He Feiyan 257,140,000.00 2016 2017 No
Sino Great Wall International
Engineering Co., Ltd. and Chen January 21, January 20,
Lve 200,000,000.00 2016 2017 No
January 29, July 28,
Chen Lve 50,000,000.00 2016 2016 Yes
September
Chen Lve 30,000,000.00 March 4, 2016 3, 2016 Yes
January 28,
Chen Lve 50,000,000.00 July 29, 2016 2017 No
Sino Great Wall International
Engineering Co., Ltd. and Chen June 20,
Lve 200,000,000.00 June 21, 2016 2017 No
Sino Great Wall International
Engineering Co., Ltd.,
Zhongcheng Jianyee
Engineering Co., Ltd. and Chen April 28,
Lve 100,000,000.00 April 29, 2016 2017 No
April 26,
Chen Lve 100,000,000.00 April 26, 2016 2017 No
November
Chen Lve 5,000,000.00 June 22, 2016 22, 2016 Yes
December
Chen Lve 45,000,000.00 July 5, 2016 5, 2016 Yes
Sino Great Wall International
Engineering Co., Ltd., Chen August 22, August 22,
Lve and He Feiyan 100,000,000.00 2016 2017 No
September 29, September
Chen Lve and He Feiyan 100,000,000.00 2016 28, 2018 No
June 28,
Chen Lve 400,000,000.00 June 28, 2016 2018 No
Sino Great Wall International
Engineering Co., Ltd., Chen April 18,
Lve and He Feiyan 200,000,000.00 April 19, 2016 2018 No
December 15, June 14,
Chen Lve 10,000,000.00 2016 2017 No
Notes to the Financial Statements Page 61
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Have the
Starting date Maturity
Amount of the guarantee
Warrantor of the date of the
guarantee been
guarantee guarantee
performed?
Sichuan Jinyu Financing
Guaranty Co., Ltd., Ye Meifu February 17, February
and Yang Qiuhua 8,000,000.00 2016 16, 2017 No
June 27,
Sino Great Wall Co., Ltd. 400,000,000.00 June 28, 2016 2017 No
March 23, March 23,
Sino Great Wall Co., Ltd. 200,000,000.00 2016 2017 No
January 3, January 2,
Sino Great Wall Co., Ltd. 180,000,000.00 2017 2018 No
February
Sino Great Wall Co., Ltd. 100,000,000.00 April 29, 2016 13, 2017 No
Sino Great Wall International
Engineering Co., Ltd. and Chen November 22, November
Lve 500,000,000.00 2016 22, 2017 No
Sino Great Wall International
Engineering Co., Ltd., Chen December 21, December
Lve and He Feiyan 300,000,000.00 2016 20, 2017 No
December 20, December
Sino Great Wall Co., Ltd. 250,000,000.00 2016 19, 2017 No
March 25, March 25,
Sino Great Wall Co., Ltd. 50,000,000.00 2016 2017 No
9.4.3 Borrowings from and to related parties
Lending/borrowing Maturity
Related parties Starting date Remark
amount date
Lending
January 1, June 30,
Chen Lve 93,855,000.00 2016 2016
December
Chen Lve 4,000,000.00 July 1, 2016 31, 2016
Remark: Provision for interest on the lendings to shareholders has been made. The
amount included in the profit and loss in 2016 was RMB 2,356,589.48.
9.4.4 Remuneration of key management
Item Amount in 2016 Amount in 2015
Remuneration of key management 1,696,900.00 1,495,100.00
9.5 Receivables from and payables to related parties
9.5.1 Receivables
Balance as at December 31, 2016 Balance as at January 1, 2016
Project Related parties Provision for Provision for
Book balance Book balance
bad debts bad debts
Accounts
receivable
Kunwu Jiuding Investment
Holdings Co., Ltd. and its
related parties 1,609,996.92 80,499.85 2,500,737.20 125,036.86
Beijing Baolilai Technology
Co., Ltd. 160,000.00 8,000.00 2,816,000.00 140,800.00
Advances to
suppliers
Notes to the Financial Statements Page 62
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
Balance as at December 31, 2016 Balance as at January 1, 2016
Project Related parties Provision for Provision for
Book balance Book balance
bad debts bad debts
Qinghai Heyi Commercial Co.,
Ltd. 18,902,151.50
9.5.2 Payables
Book Balance as at Book Balance as at
Project Related parties
December 31, 2016 January 1, 2016
Accounts payable
Qinghai Heyi Commercial Co.,
Ltd. 1,750,581.64
Other payables
Qinghai Heyi Commercial Co.,
Ltd. 2,999,209.78
He Sen 4,405,644.43
10. Commitments and contingencies
10.1 Significant commitments
There were no major commitments required to be disclosed in 2016.
10.2 Contingencies
There were no contingencies required to be disclosed in 2016.
11. Post balance sheet events
11.1 Notes to significant non-adjusting events
On July 7, 2016, the Company held the tenth session of the seventh Board of Directors and
approved the Proposal on Non-public Issuance of A Shares by Sino Great Wall Co., Ltd.. The
Company intended to issue shares to Sino Great Wall (Beijing) Investment Co., Ltd., Beijing
Anben Medical Investment Holding Co., Ltd. and Mr. Zheng Jihua to raise funds of RMB 2.5
billion. On October 14, 2016, the China Securities Regulatory Commission accepted the
Company's application for non-public offering of shares. At the sixteenth meeting of the seventh
Board of Directors convened by the Company on February 16, 2017, the Company deliberated
and passed the Proposal on Adjusting the Scheme for the Non-public Issuance of Shares and
adjusted the amount of funds to be raised to RMB 900 million.On March 22, 2017, the
Company's application for non-public issuance of A shares was approved by the Issuance
Examination Commission of China Securities Regulatory Commission, but official documents
approved by the China Securities Regulatory Commission have not received yet.
Notes to the Financial Statements Page 63
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
11.2 Profit distribution
Approved at the seventeenth session of the seventh Board of Directors, the Company distributed
cash dividends of RMB 0.60 (including tax) for every 10 shares based on the existing
16,982,450,110,000 shares. No bonus shares were given and no capital reserves were conversed
to increase share capital.
12. Other important matters
12.1 Outstanding L/G
In order to ensure the smooth completion of the project, at the request of the owner, the
Company applied to a commercial bank for issuing a performance guarantee. As at December 31,
2016, the amount of the outstanding L/G was RMB 1,262,632,100.
12.2 Segment information
12.2.1 Basis for recognition of reportable segment and accounting policies
Accounting policies of reportable segment
There were no related-party transactions among domestic architectural decoration,
overseas architectural decoration and medical treatment, so no inters-segment price
was transferred;
Medical treatment was implemented by the Company and its independent subsidiary;
overseas architectural decoration was accounted for according to the account sets set
up in the regions where the projects in progress are located, mainly including account
sets for Qatar, Kuwait, Cambodia, Sri Lanka, Malaysia, Burma, Maldives and Saipan,
so there were no fees which were indirectly attributable to each segment and needed to
be amortized; the business data of overseas architectural decoration was formed by the
financial data of the above 8 account sets for major projects.
Notes to the Financial Statements Page 64
SINO GREAT WALL CO., LTD.
FOR THE YEAR ENDED DECEMBER 31, 2016
NOTES TO THE FINANCIAL STATEMENTS
12.2.2 Financial information of reportable segments
Domestic architectural decoration Overseas architectural decoration Medical treatment Offset Total
Item
Year 2016 Year 2015 Year 2016 Year 2015 Year 2016 Year 2015 Year 2016 Year 2015 Year 2016 Year 2015
I. Operating income 1,418,192,694.17 2,428,344,815.19 3,165,213,312.57 1,560,310,586.25 81,593,110.43 -21,703,598.14 4,664,999,117.17 4,010,358,999.58
Including: income from
external transactions 1,418,192,694.17 2,428,344,815.19 3,165,213,312.57 1,560,310,586.25 81,593,110.43 -21,703,598.14 4,664,999,117.17 4,010,358,999.58
Income from inter-segment
transactions - -
II. Operating cost 1,184,945,928.21 1,988,442,188.52 2,216,759,318.30 1,154,881,399.00 57,672,498.15 -21,703,598.14 3,459,377,744.66 3,165,027,185.66
Including: costs of external
transactions 1,184,945,928.21 1,988,442,188.52 2,216,759,318.30 1,154,881,399.00 -21,703,598.14 3,401,705,246.51 3,165,027,185.66
Costs of inter-segment
transactions - -
III. Losses from asset
impairment 74,286,638.56 80,433,729.48 95,207,208.36 30,903,374.69 518,043.19 170,011,890.11 111,337,104.17
IV. Depreciation and
amortization 3,004,474.27 6,985,552.79 30,488.71 21,288.88 19,316.10 -3,794,638.67 6,848,917.76 7,006,841.67
V. Total profit -304,963,110.16 69,862,580.73 864,476,659.76 360,904,330.95 3,583,802.03 - 1,759,594.94 -25,117.82 561,337,756.68 430,792,029.50
VI. Income tax expenses -10,207,854.94 76,207,293.00 99,038,519.27 8,766,407.91 1,703,401.20 1,289,203.78 89,244,861.75 84,973,700.90
VII. Net profit -294,755,255.22 -6,344,712.27 765,438,140.48 352,137,923.04 1,880,400.83 - 470,391.16 -25,117.82 472,092,894.93 345,818,328.60
VIII. Total assets 10,947,559,949.24 6,044,181,578.99 3,044,412,477.45 1,097,651,243.20 121,748,481.08 6,127,541,946.13 3,124,369,997.56 7,986,178,961.63 4,017,462,824.63
IX. Total liabilities 7,089,471,639.73 2,406,019,801.98 1,752,059,212.34 690,133,065.43 136,402,672.37 2,822,237,435.41 358,948,894.24 6,155,696,089.04 2,737,203,973.17
Notes to the Financial Statements Page 65
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
13. Notes to main items of the financial statements of the parent company
13.1 Accounts receivable
13.1.1 Disclosure of accounts receivable by category
Balance as at December 31, 2016
Book balance Provision for bad debts
Category
Proportion Proportion Book value
Amount Amount
(%) (%)
Receivables that are individually significant but
with provision for bad debts made on an individual
basis
Receivables subject to provision for bad debts on
credit risk characteristics basis 6,680.00 100.00 334.00 5.00 6,346.00
Receivables that are individually insignificant but
with provision for bad debts made on an individual
basis
Total 6,680.00 100 334 5 6,346.00
(Continued)
Balance as at January 1, 2016
Book balance Provision for bad debts
Category
Proportion Proportion Book value
Amount Amount
(%) (%)
Receivables that are individually significant but
with provision for bad debts made on an individual
basis
Receivables subject to provision for bad debts on
credit risk characteristics basis 30,614.00 100.00 1,530.70 5.00 29,083.30
Receivables that are individually insignificant but
with provision for bad debts made on an individual
basis
Total 30,614.00 100 1,530.70 5 29,083.30
In the portfolio, accounts receivable with the provision for bad debts made under the
aging analysis method:
Balance as at December 31, 2016
Aging Accounts Provision for Proportion of
receivable bad debts provision
Within 1 year 6,680.00 334.00 5.00
1 to 2 years
2 to 3 years
3 to 4 years
4 to 5 years
Over 5 years
Total 6,680.00 334.00
13.1.2 Provision, recovery or reversal of accounts receivable in 2016
The provision for bad debts made in 2016 was RMB 0.00; the provision for bad debts
recovered or reversed in 2016 was RMB 1,196.70.
13.1.3 Top five receivables by debtor
Balance as at December 31, 2016
Company name Accounts Proportion in the total Provision for
receivable accounts receivables (%) bad debts
Sporadic individual rent in Kuichong,
Shenzhen 6,680.00 100.00 334.00
Total 6,680.00 100.00 334.00
Notes to the Financial Statements Page 66
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
13.2 Other receivables
13.2.1 Disclosure of other receivables by category:
Balance as at December 31, 2016
Book balance Provision for bad debts
Category
Proportion Book value
Amount Amount Proportion (%)
(%)
Other receivables that are individually
significant but with provision for bad debts
made on an individual basis
Other receivables provided for bad debts on
portfolio of credit risks 1,672,982,763.29 100.00 782,721.31 0.05 1,672,200,041.98
Other receivables that are individually
insignificant but with provision for bad debts
made on an individual basis
Total 1,672,982,763.29 100 782,721.31 0.05 1,672,200,041.98
(Continued)
Balance as at January 1, 2016
Book balance Provision for bad debts
Category
Proportion Book value
Amount Amount Proportion (%)
(%)
Other receivables that are individually
significant but with provision for bad debts
made on an individual basis
Other receivables provided for bad debts on
portfolio of credit risks
Other receivables that are individually
insignificant but with provision for bad debts
made on an individual basis
Total
Remark: There were no other receivables as at January 1, 2016.
13.2.2 Provision for bad debts and reversal or recovery thereof in 2016
The provision for bad debts made in 2016 was RMB 782,721.31; the provision for bad
debts recovered or reversed in 2016 was RMB 0.00.
13.2.3 Category of other receivables by nature
Book Balance as at Book Balance as at
Nature
December 31, 2016 January 1, 2016
Current accounts between entities 1,657,328,337.13
Petty cash 1,272,085.13
Margin and deposit 14,382,341.03
Others
Total 1,672,982,763.29
13.2.4 Top five other receivables by debtor
Proportion in Balance of
Balance as at
total other provision for bad
Company name Nature December 31, Aging
receivables debts as at
2016
(%) December 31, 2016
Wuhan Commercial
Workers Hospital Co., Current accounts with
Ltd. related parties 107,800,000.00 Within 1 year 6.44
Notes to the Financial Statements Page 67
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Proportion in Balance of
Balance as at
total other provision for bad
Company name Nature December 31, Aging
receivables debts as at
2016
(%) December 31, 2016
Upper First-class
Hospital, Hongqiao,
Liangdu, Liupanshui
(Finance Bureau of
Fushun Economic
Development Zone) Deposits 10,000,000.00 Within 1 year 0.60 500,000.00
Hunan Trust Co., Ltd. Deposits 2,000,000.00 Within 1 year 0.12 100,000.00
Borrowings of
Xu Ce employees 1,109,002.22 Within 1 year 0.07 55,450.11
The First People's
Hospital of Lingbao City
(COCITC) Deposits 1,000,000.00 Within 1 year 0.06 50,000.00
Total / 121,909,002.22 / 7.29 705,450.11
13.3 Long-term equity investments
Balance as at December 31, 2016 Balance as at January 1, 2016
Provision Provision
Item
Book balance for Book value Book balance for Book value
impairment impairment
Investment in subsidiaries 3,176,451,536.66 3,176,451,536.66 3,079,451,536.66 3,079,451,536.66
Total 3,176,451,536.66 3,176,451,536.66 3,079,451,536.66 3,079,451,536.66
13.3.1 Investment in subsidiaries
Balance of
Balance as at Balance as at Provision for provision for
Increase Decrease
Investee January 1, December 31, impairment in impairment as at
in 2016 in 2016
2016 2016 2016 December 31,
2016
Sino Great
Wall
International
Engineering
Co., Ltd. 3,079,451,536.66 3,079,451,536.66
Wuhan
Commercial
Workers
Hospital Co.,
Ltd. 97,000,000.00 97,000,000.00
Total 3,079,451,536.66 97,000,000.00 3,176,451,536.66
13.4 Investment income
Item Amount in 2016 Amount in 2015
Income from long-term equity investments accounted
for under cost method
Income from long-term equity investments accounted
for under equity method
Investment income from disposal of long-term equity
investments
Investment income received from financial assets
measured at fair value through current profit and loss
during the holding period
Notes to the Financial Statements Page 68
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Item Amount in 2016 Amount in 2015
Investment income received from disposal of financial
assets measured at fair value through current profit and
loss
Investment income from held-to-maturity investments
during the holding period
Investment income of available-for-sale financial
assets during the holding period
Investment income from disposal of available-for-sale
financial assets
Gains and losses arising from re-measurement of the
remaining equities at the fair value after the loss of the
control
Others 396,197.49
Total 396,197.49
13.5 Operating income and operating cost
Amount in 2016 Amount in 2015
Item
Income Cost Income Cost
Primary business
Other business 238,048.64 2,318,061.00 237,620.18
Total 238,048.64 2,318,061.00 237,620.18
14. Supplementary information
14.1 Breakdown of current non-recurring profits and losses
Item Amount Remark
Profits or losses from disposal of non-current assets -564,833.40
Tax returns, deduction and exemption approved
beyond the authority or without official approval
documents
Government grants included in current profits and
losses (except for government grants closely related to
the enterprise business, obtained by quota or quantity
at unified state standards) 108,121.33
Expenses for using funds charged from non-financial
enterprises and included in the current profit and loss
Gains from the difference between the investment
costs of acquisition of subsidiaries, associates and joint
ventures and share in the net fair value of the
identifiable assets of the investee when investing 1,783,284.99
Profit or loss on exchange of non-monetary assets -
Gains or losses from entrusting the investments or
management of asset
Provision of asset impairment made due to force
majeure, such as natural disasters
Gains or losses from debt restructuring
Enterprise reorganizing expenses, such as employee
accommodation costs and integration expenses
Gains or losses from transactions with obvious unfair
transaction price
Current net gains and losses of the subsidiaries from
business combinations under common control from the
beginning of the period to the combination date
Notes to the Financial Statements Page 69
SINO GREAT WALL CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016
Item Amount Remark
Profit or loss on contingencies irrelevant to normal
operation of the Company
Except for effective hedging business related to the
normal business of the company, profits or losses from
fair value changes in held-for-trading financial assets
and held-for-trading financial liabilities, and
investment income from disposal of held-for-trading
financial assets, held-for-trading financial liabilities
and available-for-sale financial assets 443,065.98
Reversal of the impairment provision for receivables
subject to separate impairment test -
Profits or losses from entrusted loans -
Profit or loss on changes in fair value of investment
properties subsequently measured under the fair value
model -
Effects of one-off adjustments to the current profit and
loss in accordance with the requirements of tax and
accounting laws and regulations on the current profit
and loss -
Custodian income from entrusted management -
Other non-operating income and expenditure except
for the above items 5,296,814.65
Other items of gains and losses subject to the definition
of non-recurring gains and losses -
Effect of income tax -3,668,000.60
Effect of minority interests -11,192.65
Total 3,387,260.30
14.2 Return on equity and earnings per share:
Earnings per share (RMB)
Weighted average return
Profit for the reporting period Basic earnings per Diluted earnings
on equity (%)
share per share
Net profit attributable to ordinary
shareholders of the Company 31.18 0.28 0.28
Net profit attributable to ordinary
shareholders of the Company after deducting
non-recurring gains and losses 30.96 0.28 0.28
Sino Great Wall Co., Ltd.
(Official Seal)
April 26, 2017
Notes to the Financial Statements Page 70
