2021 Annual Report
Shenzhen Textile (Holdings) Co., Ltd.
2021 Annual Report
March 2022
2021 Annual Report
I. Important Notice, Table of Contents and Definitions
The Board of Directors ， the Supervisory Committee, the directors, the supervisors, and executives of the
Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the
Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of
the Report.
Ms. Zhang Jian, The Company leader, Mr. He Fei, Chief financial officer and the Ms.Zhu Jingjing, 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 the review of this Report.
Concerning the forward-looking statements with future planning involved in the Report, they do not constitute a
substantial commitment for investors, Investors and related persons shall keep sufficient risk awareness, and shall
understand the differences between plans, forecasts and commitments, and remind investors of investment risks.
The company has the macroeconomic risks, market competition risks and raw material risks. Investors are advised
to pay attention to investment risks. For details, please refer to the possible risk factors that the company may face
in the XI "Risks facing the Company and countermeasures " in the Section III "Management Discussion &
Analysis".
The company’s profit distribution plan approved by the board of directors this time is: based on 506,521,849
shares, a cash dividend of 0.50 yuan (tax included) will be distributed to all shareholders for every 10 shares, and
0 shares (tax included) will be given as bonus shares. The capital reserve will not be converted into share capital.
This Report has been prepared in both Chinese and English. In case of any discrepancy, the Chinese version shall
prevail.
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2021 Annual Report
Table of Contents
I. Important Notice, Table of contents and Definitions
II. Company Profile & Financial Highlights.
III. Management Discussion & Analysis
IV. Corporate Governance
V. Environmental & Social Responsibility
VI. Important Events
VII. Change of share capital and shareholding of Principal Shareholders
VIII. Situation of the Preferred Shares
IX. Corporate Bond
X. Financial Report
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2021 Annual Report
Documents available for inspection
1. Accounting statements carried with personal signatures and seals of legal representative, General Manager,
Chief Financial officer.
2. Original of Auditors’ Report carried with the seal of Certified Public Accountants as well as personal signatures
of certified Public accountants.
3. The texts of all the Company's documents publicly disclosed on the newspapers and periodicals designated by
China Securities Regulatory Commission in the report period.
The above documents were completely placed at the Office of Secretaries of the Board of Directors of the
Company.
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2021 Annual Report
Definition
Terms to be defined Refers to Definition
Company/The Company/ Shen Textile Refers to Shenzhen Textile (Holdings) Co., Ltd
Articles of Association Refers to Articles of Association of Shenzhen Textile (Holdings) Co., Ltd
Actual controller / National Assets
National Assets Regulatory Commission of Shenzhen Municipal
Regulatory Commission of Shenzhen Refers to
People's Government
Municipal People's Government
The Controlling shareholder/ Shenzhen
Refers to Shenzhen Investment Holdings Co., Ltd.
Investment Holdings Co., Ltd.
Shenchao Technology Refers to Shenzhen Shenchao Technology Investment Co., Ltd.
SAPO Photoelectric Refers to Shenzhen SOPO Photoelectric Co., Ltd.
Jinjiang Group Refers to Hangzhou Jinjiang Group Co., Ltd.
Nitto Denko Refers to Nitto Denko Corporation
Beauty Century Refers to Shenzhen Beauty Century Garment Co., Ltd.
Shenzhen Xieli Refers to Shenzhen Xieli Automobile Co., Ltd.
Jinxin Investment Refers to Lanxi Jinxin Investment Management Co., Ltd.
Changxing Junying Refers to Changxing Junying Eqkuity Investment Partnership（LP）
Huaiji Investment Refers to Hangzhou Huaiji Investment Management Co., Ltd.
Shenzhen Textile Import & Export Refers to Shenzhen Textile Import & Export Co., Ltd.
Jinhang Investment Refers to Hangzhou Jinhang Investment Fund Partnership（LP）
Advantage ford Refers to Suzhou Advantage ford Investment Center（LP）
Line 4 Refers to T TFT-LCD polarizer II phase Line 4 project
Line 5 Refers to TFT-LCD polarizer II phase Line 5 project
Line 6 Refers to TFT-LCD polarizer II phase Line 6 project
Line 7 Refers to Industrialization project of polaroid for super large size TV
“CSRC” Refers to China Securities Regulatory Commission
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
The Report Refers to 2021 Annual Report
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2021 Annual Report
II. Company Profile & Financial Highlights
I. Company Profile
Stock abbreviation Shen Textile A ,Shen Textile B Stock code 000045,200045
Stock exchange for listing Shenzhen Stock Exchange
Name in Chinese 深圳市纺织(集团)股份有限公司
Chinese abbreviation (If any) 深纺织
English name (If any) SHENZHEN TEXTILE (HOLDINGS) CO., LTD
English abbreviation (If any) STHC
Legal Representative Zhang Jian
Registered address 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen
Postal code of the Registered Address 518031
Historical change of the company's
No
registered address
Office Address 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen
Postal code of the office address 518031
Internet Web Site http://www.chinasthc.com
E-mail szfzjt@chinasthc.com
II. Contact person and contact manner
Board secretary Securities affairs Representative
Name Jiang Peng Li Zhenyu
6/F, Shenzhen Textile Building, No.3 Huaqiang 6/F, Shenzhen Textile Building, No.3 Huaqiang
Contact address
North Road, Futian District, Shenzhen North Road, Futian District, Shenzhen
Tel 0755-83776043 0755-83776043
Fax 0755-83776139 0755-83776139
E-mail jiangp@chinasthc.com lizy@chinasthc.com
III. Information disclosure and placed
Newspapers selected by the Company for information Securities Times, China Securities, Shanghai Securities Daily and
disclosure Hongkong Commercial Daily.
Internet website designated by CSRC for publishing the
www.cninfo.com.cn
Annual report of the Company
The place where the Annual report is prepared and placed Office of the Board of directors
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2021 Annual Report
IV. Changes in Registration
Organization Code 19217374-9
In July 2012, The business scope of the company is changed to "production, textiles processing,
knitwear, clothin
g, upholstery fabrics, belts, trademark bands, handicrafts (without restrictions); general
merchandise, the special equipment of the textile industry, textile equipment and accessories,
instruments, standard parts, raw textile materials, dyes, electronic products, chemical products,
mechanical and electrical equipment, light industrial products, office supplies and domestic
trade (excluding the franchise, the control and the monopoly of goods) ; operation of import
Changes in principal business and export business."
activities since listing (if any) In December 2018, approved by Shenzhen Market Supervisory Authority, the company's
business scope was changed to: production and operation of polarizers and other optical film
products; hotel and property leasing and management; production and processing of textiles,
knitwear, clothing, and decorative fabrics , Belts, trademark belts, handicrafts (excluding
restricted items); department stores, special equipment for the textile industry, textile equipment
and accessories, meters, standard parts, textile raw materials, dyes, electronic products,
chemical products, electromechanical equipment, textile products, office Supplies and domestic
trade (excluding franchise, control, and monopoly commodities); import and export business.
In October 2004,In accordance with the Decision on Establishing Shenzhen Investment
Holdings Co., Ltd. issued by State-owned Assets Administration Committee of Shenzhen
Changes is the controlling Municipal People's Government (Shen Guo Zi Wei (2004) No. 223 Document), Shenzhen
shareholder in the past (is any) Investment Management Co., Ltd., the controlling shareholder of the Company, and Shenzhen
Construction Holding Company and Shenzhen Commerce and Trade Holding Company merged
into Shenzhen Investment Holdings Co., Ltd.
V. Other Relevant Information
CPAs engaged
Name of the CPAs Grant Thornton International Ltd（Special Geneaal Partnership）
Office address： 5/F, Scitech Palace 22 Jianguomenwai Avenue, Chaoyang District, Beijing
Names of the Certified Public
Zhen Zhifang,Liu Duoqi
Accountants as the signatories
The sponsor performing persistent supervision duties engaged by the Company in the reporting period.
□ Applicable√ Not applicable
The Financial advisor performing persistent supervision duties engaged by the Company in the reporting period
□ Applicable√ Not applicable
VI.Summary of Accounting data and Financial index
Whether it has retroactive adjustment or re-statement on previous accounting data
□ Yes √ No
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2021 Annual Report
Changes of this
period over same
2021 2020 2019
period of Last
year(%)
Operating income（Yuan） 2,293,747,892.06 2,108,964,687.80 8.76% 2,158,184,855.71
Net profit attributable to the shareholders
61,162,384.25 37,267,995.74 64.12% 19,679,910.43
of the listed company（Yuan）
Net profit after deducting of non-recurring
gain/loss attributable to the shareholders of 40,650,013.22 18,084,607.04 124.78% -41,179,849.56
listed company（Yuan）
Cash flow generated by business operation,
-4,436,980.35 1,930,932.76 -329.78% 383,145,788.50
net（Yuan）
Basic earning per share(Yuan/Share) 0.12 0.07 71.43% 0.04
Diluted gains per share(Yuan/Share) 0.12 0.07 71.43% 0.04
Weighted average ROE(%) 2.19% 1.36% 0.83% 0.75%
Changed over last
End of 2021 End of 2020 End of 2019
year（％）
Gross assets（Yuan） 5,496,647,107.83 4,969,547,552.23 10.61% 4,531,399,885.99
Net assets attributable to shareholders of
2,816,795,889.89 2,766,234,174.39 1.83% 2,727,764,144.36
the listed company（Yuan）
The lower of the company’s net profit before and after the deduction of non-recurring gains and losses in the last
three fiscal years is negative, and the auditor's report of the previous year shows that the Company’s going
concern ability is uncertain.
□ Yes √No
The lower of the net profit before and after the deduction of the non-recurring gains and losses is negative.
□ Yes √No
VII. Differences between accounting data under domestic and overseas accounting standards
1. Differences of net profit and net assets disclosed in financial reports prepared under international and Chinese
accounting standards.
□ Applicable √Not applicable
No difference.
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese
accounting standards.
□ Applicable √Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign
accounting rules or Chinese GAAP(Generally Accepted Accounting Principles) in the period.
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2021 Annual Report
VIII. Main Financial Index by Quarters
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 552,950,209.39 548,586,197.99 570,752,050.04 621,459,434.64
Net profit attributable to the shareholders of the
42,776,335.85 33,826,738.54 4,921,591.39 -20,362,281.53
listed company
Net profit after deducting of non-recurring
gain/loss attributable to the shareholders of listed 39,905,925.26 21,908,603.63 815,872.77 -21,980,388.44
company
Net Cash flow generated by business operation -75,288,004.27 22,644,468.02 -14,976,407.55 63,182,963.45
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 (2021) Amount (2020） Amount (2019) Notes
Non-current asset disposal gain/loss(including
the write-off part for which assets impairment -961,982.35 273,229.58 54,895,878.65
provision is made)
Other benefits of
Government subsidy recognized in current
government
gain and loss(excluding those closely related
19,643,379.33 29,506,252.69 27,547,902.92 subsidies that are
to the Company’s business and granted under
confirmed related to
the state’s policies)
the main business.
Switch back of provision for depreciation of
account receivable which was singly taken 989,313.04 469,470.61
depreciation test.
Other non-business income and expenditures
19,964,046.87 1,310,556.26 4,582,973.27
other than the above
Less :Influenced amount of income tax 6,025,891.12 53,313.37 13,886,055.96
Influenced amount of minor shareholders’
13,096,494.74 11,853,336.46 12,750,409.50
equity (after tax)
Total 20,512,371.03 19,183,388.70 60,859,759.99 --
Details of other profit and loss items that meet the non-recurring profit and loss definition
□ Applicable√ Not applicable
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2021 Annual Report
None
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Companies 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
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
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.
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2021 Annual Report
III. Management Discussion & Analysis
I. Industry information of the Company during the reporting period
Polarizers are also known as polaroid, which can control the polarization direction of specific light beams. When
natural light passes through the polarizer, the light whose vibration direction is perpendicular to the transmission
axis of the polarizer will be absorbed, leaving only polarized light whose vibration direction is parallel to the
transmission axis of the polarizer. The downstream polarizer is mainly used in the panel industry. According to
different panel types, polarizers mainly include TN, STN, TFT and OLED. Currently, the global polarizer market
is dominated by polarizers for TFT-LCD panels. Each LCD panel requires two polarizers.
The Company is one of the major R&D, production and sales enterprises of polarizers in China, and the leading
enterprise of polarizer industry in China. The Company's polarizer is one of the key basic materials in the display
panel industry, and its demand is greatly affected by the fluctuation of the display panel market. In the first half of
2021, due to the strong terminal demand and the shortage of upstream raw materials of various display panels
caused by telecommuting and distance learning, the display panel market showed a pattern of short supply, the
panel price continued to rise, and the polarizer market witnessed a good prosperity. In the second half of 2021,
with the increase of vaccination rate for COVID-19, the pandemic eased, the market demand gradually stabilized,
and the supply of raw materials gradually recovered, the display panel market ended its upward cycle, the prices
of different types of panels dropped successively, and the market demand for polarizers gradually stabilized.
II.Main Business the Company is Engaged in During the Report Period
(1)The company's main business
The company's main business covered such the high and new technology industry as represented by LCD
polarizer, its own property management business and the retained business of high-end textile and garment.
During the reporting period, the Company's main business has not changed significantly. First, the Company
focused on adjusting its marketing strategy, continuously promoting the optimization of customer and product
structure, balancing the sales share of major panel customers, and enhancing the anti-risk and profitability; Second,
it strengthened the production management, improved the production capacity and product quality, further
speeded up the elevator, carried out equipment and technical transformation, improved the automation level in the
later stage, and continuously improved the production capacity and product quality; Third, it controlled the cost
and reduced the cost through a number of measures, such as the import of alternative raw materials and the
broadening of procurement channels; Fourth, it continued to overcome the adverse effects of the COVID-19, and
made every effort to promote the project construction and ramp up of Line 7. The Line 7 project was put into
production in mid-July and entered the ramp up period, with a steady increase in yield and machine speed, laying
a solid foundation for the rapid increase of oversized orders in the whole year of 2022 and the realization of
production line profitability; Fifth, it built the R&D management system, strengthened the R&D efforts on new
products, new materials, production processes and other aspects, and introduced more alternative raw materials,
among which, the polarizer for OLED TV successfully achieved mass production, filling the domestic gap; Sixth,
it effectively revitalized the existing assets. The Company implemented the transfer liquidation work for some
subsidiaries and shareholding enterprises, and concentrated on developing the main business of polarizers;
Seventh, it implemented the epidemic prevention and control work, paid attention to safe and green production,
focused on rectification, safety and environmental protection issues, and promoted the safe and stable
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development of enterprises.
During the reporting period, the Company achieved operating income of RMB 2.294 billion, with a year-on-year
increase of 8.76%; Realized a total profit of RMB 86.23 million with a year-on-year increase of 66.79%; And
achieved a net profit attributable to shareholders of listed companies of RMB 61.16 million, with a year-on-year
increase of 64.12%. During the reporting period, the net profit attributable to shareholders of listed companies
increased significantly compared with the same period of last year. The main reasons are as follows: First, in 2021,
the polarizer market was generally stable and improved, the Company further optimized the order structure, and
the average gross profit margin increased steadily; Second, in order to cope with the COVID-19 in 2020 and
support the enterprises to overcome the difficulties together, the Company actively responded to the call of
Shenzhen Municipal Party Committee, Municipal Government and State-owned Assets Supervision and
Administration Commission to reduce the rent for some tenants in February, March and November 2020, and the
rent income of such period increased substantially year on year.
(2)Main products and their purposes
Currently, the Company has 7 mass production lines for polarizers, covering TN, STN, TFT, OLED, 3D, dye sheet,
optical film for touch screen and other fields, mainly used in TV, NB, navigator, Monitor, vehicle, industrial
control, instruments, smart phones, wearable devices, 3D glasses, sunglasses and other products，the company has
become a mainstream panel company such as Huaxing Optoelectronics, BOE, Sharp, LGD, Shenzhen Tianma,
Huike, etc. by continuously strengthening sales channel expansion and building its own brand. Qualified
suppliers.
The Company's main products made in each polarizer production line and their application are as follows:
Line Place Product breadth Planned capacity Main projuct
Line 1 Pingshan 500mm 600，000 m2 TN/STN/ Dye sheet
Line 2 Pingshan 500mm 1.2 million m2 TN/STN/CSTN
Line 3 Pingshan 650mm 1 million m2 TFT
Line 4 Pingshan 1490mm 6 million m2 TFT
Line 5 Pingshan 650mm 2 millin m2 TFT
Line 6 Pingshan 1490mm 10 million m2 TFT/OLED
Line 7 Pingshan 2500mm 32 millin m2 TFT/OLED
(3)Company's business model
The polarizer industry has gradually shifted from a traditional business model of R&D, production, and sales
to a customer-centric, joint research and development, and comprehensive service business model. By
understanding customer needs, joint research and develop, manage high-standard production, manufacture
high-quality products, use advanced polarizer roll and attaching equipment to cooperate with downstream panel
manufacturers' production lines, reduce production links, reduce production and transportation costs, and create
value for customers, win-win.
(4) Major factors for driving the Company's performance
Refer to "III. Analysis on core competitiveness" in this section for details.
(5)Market position of company products
Currently, the Company is one of the major R&D, production and sales enterprises of polarizers in China, and is
the leading enterprise in the domestic polarizer industry. The Company mainly focuses on medium and large-sized
polarizer products, and meanwhile has the production capacity of multi-size and multi-series products.
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In the future, the Company will further adjust and optimize the product structure and customer structure,
improve the internal management level, optimize and upgrade the production technology level, improve the
production efficiency and product quality, broaden the procurement channels, reduce the production cost and
consolidate and improve the market competitiveness.
(6) Advantages and disadvantages in competition
1. Competitive edge
See "III. Analysis of core competitiveness" in this chapter for details.
2. Competitive disadvantage
See "XI. Future development prospect of the Company (III) Possible risks" in this chapter for details.
III. Analysis On core Competitiveness
(1)Technology advantages. SAPO Photoelectric is the first domestic national high-tech company which
entered into the R&D and production of the polarizer，We are one of the largest, most technical and professional
polarizer R&D teams in the country and has more than 20 years of operating experience in the polarizer industry.
Products include TN-type, STN-type, IPS-TFT-type, VA-TFT-type, OLED, vehicle-mounted industrial display,
flexible display, 3D stereo and polarizer for sunglasses, and optical film for touch screens, etc.,We have
proprietary technology for polarizers and new intellectual property rights for various new products. As of the end
of this report , SAPO Photoelectric applied for 115 invention patents and was authorized with 89 items, among
which: 36 domestic invention patents(16 patents got authorized); 72 domestic utility model patents(69 patents got
authorized); 1 overseas invention patent(0 patents got authorized); 6 overseas utility model patents(4 patents got
authorized). There were 4 national standards and 2 industrial standards that were developed by the company are
approved and then will be implemented. will be implemented.
SAPO Photoelectric has three innovative platforms: Guangdong Engineering Technology Research Center,
Shenzhen Polarizing Materials and Technology Engineering Laboratory and Shenzhen Enterprise Technology
Center. It focuses on the R&D and industrialization of LCD polarizer core production technology, the
development and industrialization of OLED polarizer new products, and the localization research of polarizer raw
materials, among which, mass production has been achieved for OLED TV polarizer products successfully, filling
the domestic gap. By introducing all kinds of precision test equipment, it improves lab trial and pilot-scale test
methods, and builds a collaborative innovation platform for Industry-University-Research cooperation, to enhance
the R&D level comprehensively.
(2)Talents advantages. The Company has a polarizer management team and a team of senior technicians with
strong technical ability, long cooperation time, rich experience and international vision. By establishing a
technical cooperation relationship with Nitto Denko Corporation, a world-class polarizer manufacturer, the
Company learns advanced polarizer production management concepts, and meanwhile accumulates technical
experience through independent innovation, improves its core competitiveness, and gradually accumulates its own
brand, technology, operation management and other advantages. In 2021, the Company continued to deepen the
market-oriented reform, practiced the concept of "Don't race horses", and set a good vane for talent selection and
employment; It improved the talent growth channel, established the management method of employee promotion
by rank, and helped employees grow and develop; It improved the incentive mechanism of assessment, and fully
utilized the incentive and spur role of assessment; Actively explored the long-term incentive and restraint of the
Company's management level, employee benefit award distribution mechanism, Employee Stock Ownership Plan
(ESOP), etc., and built a value distribution mechanism of benefit sharing and risk pooling.
(3)Market advantages. The company has good customer groups not only in domestic market but in foreign market,
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2021 Annual Report
compared with foreign advanced counterparts, the biggest advantage lies in the localization for supporting, close
to the panel market, as well as the strong support of the national policy. In terms of market demand, with the mass
production of the 10.5/11-generation TFT-LCD panel production lines under construction and planned for the next
few years, the production capacity of high-generation TFT-LCD panels in mainland China will increase
significantly in the next few years, the corresponding domestic polaroid film market demand has also increased,
and the domestic market is the most important market for polaroid manufacturers, especially in the large-size
polarizer market. Mainland polarizer manufacturers will usher in important industry opportunities; in terms of
market development, the company takes production material control as the core, technology services as the guide,
customer needs as the focus, organically combines production and sales, establishes a rapid response mechanism,
fully exploits localization advantages, and uses its own accumulated technology and talents, does a good job of
peer-to-peer professional services, forms a stable supply chain and increases market share.
(4)Quality advantages. The company always adhered to the quality policy of "Satisfying customer demands and
pursuing excellent quality" and focused on product quality control. The company strictly controls product
performance indicators, standardizes inspection standards for incoming materials, starts with quality improvement
and consumption reduction, and achieves simultaneous increase in output and quality; through the introduction of
a modern quality management system, the products have passed ISO9001 Quality Management System and
ISO14001 Environmental Management System, OHSAS18000 Occupational Health and Safety Management
System, QCO80000 System Certification; the product is tested by SGS and meets the environmental
protection ,The company had increased the automatic detecting and marking equipments in the beginning section
and the ending section, strictly controlled the product quality and improved the product utilization rate and
product management efficiency.
(5)Management advantages. SAPO Photoelectric has accumulated rich management experiences in more than 20
years in the manufacturing of polarizer, possessing the home most advanced control technology of the production
management process of the polarizer and quality management technology and the stable raw material procurement
channel so forth management systems. The company had carried out comprehensive benchmarking work,
organized the management personnel to learn advanced experiences from customers and peers to force the
elevation of management ability, and drew on the foreign company’s management experiences of polarizer,
optimized the company's organizational structure, reduced the managerial hierarchy and further enhanced the
company's management efficiency. After the introduction of the strategic investor, Through close cooperation with
Jinjiang Group, we complement each other's strengths, absorb the vitality of private enterprises, continue to
implement advanced management systems, reasonable incentive mechanisms, etc., improve the efficiency of
decision-making, enhance the speed of market response, improve the research and development incentive system,
and also realize the deep integration of the value of the company and its employees and stimulates the new vitality
of the business.
(6)Policy advantages. Polarizer is seen as an essential part of the panel display industry and SAPO Photoelectric
in its development has promoted the supply capacity of national polarizers, greatly lowered the dependence of
national panel enterprises on imported polarizers, and safeguarded the national panel industry, which serves as a
good facilitator to enhancing the overall competitiveness of China's panel industry chain and coordinated
development of the whole industry chain of the panel display industry cluster in Shenzhen. Recognized as a
national high-tech enterprise, the Company is entitled to the preferential policy for duty-free import of own
productive raw materials that cannot be produced at home and frequently gained national, provincial and
municipal policy and financial support in its polarizer projects. Meanwhile, the Company tightened supplier
management, improved its overall purchasing strategy, and downsized suppliers while introducing a competitive
mechanism, wherein focus was given to introduction of new materials at a competitive price, to further lower its
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2021 Annual Report
production cost and improve its product competitiveness.
IV. Main business analysis
(1)General
2021 is the first year of the 14th Five-Year Plan, and it is also a crucial year for the Company to deepen reform,
transformation and development. In the past year, challenged by the severe and complicated economic situation,
the Company has unified thoughts, strengthened confidence, worked hard together, overcame the difficulties, and
made efforts to turn challenges into opportunities. It has made new progress in its project construction of Line 7,
operation and management, and exploration in property leasing, laying a solid foundation for the Company's
further transformation and development.
During the reporting period, the Company achieved operating income of RMB 2.294 billion, with a
year-on-year increase of 8.76%; Realized a total profit of RMB 86.23 million with a year-on-year increase of
66.79%; And achieved a net profit attributable to shareholders of listed companies of RMB 61.16 million, with a
year-on-year increase of 64.12%. The company's operating income, total profit and net profit attributable to
shareholders of listed companies all increased compared with the same period of last year. The main reasons are as
follows: First, in 2021, the polarizer market was generally stable and improved, the Company further optimized
the order structure, and the average gross profit margin increased steadily; Second, in 2020, in order to cope with
the COVID-19 in 2020 and support the enterprises to overcome the difficulties together, the Company actively
responded to the call of Shenzhen Municipal Party Committee, Municipal Government and State-owned Assets
Supervision and Administration Commission to reduce the rent for some tenants in February, March and
November 2020, and the rent income of such period increased year on year.
Review of the company's key works carried out in 2021 as follows:
1. Achieved sustained profitability in its main polarizer business
In 2021, first, the Company focused on adjusting its marketing strategy, continuously promoting the optimization
of customer and product structure, balancing the sales share of major panel customers, and enhancing the anti-risk
and profitability; Second, it strengthened the production management, improved the production capacity and
product quality, further speeded up the elevator, carried out equipment and technical transformation, improved the
automation level in the later stage, and continuously improved the production capacity and product quality; Third,
it controlled the cost and reduced the cost through a number of measures, such as the substitution of raw materials
and the broadening of procurement channels; Fourth, it increased the introduction and selection of talents and
enhanced the competitiveness of the team. Meanwhile, the Company established the R&D management system,
strengthened the R&D of new products, new materials, production processes and other aspects and the import of
alternative raw materials, and developed, evaluated and promoted 93 kinds of materials in total. In 2021, it had 8
patent applications, including 4 national invention patents and 4 utility model patents; and it was granted with 10
patents, including 2 invention patents and 8 utility model patents.
2. Its textile business remained stable, and its property leasing and management business were steadily improving
In 2021, the Company made great efforts to overcome the influence of exchange rate fluctuation, COVID-19
and rising raw material prices, and took effective measures to strengthen product R&D, expand new market areas,
and realize sustained profitability of textile business.
In 2021, the downturn of the real economy brought certain pressure to property leasing and its management
business. The Company took the initiative to introduce high-quality new tenants, and strengthened property
management, continuously improved service quality, paid close attention to the prevention and control of
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2021 Annual Report
COVID-19, and achieved a good situation of double 100% for both rental rate and rental recovery rate, with
property leasing and its management business both growing steadily.
3. Strived to promote the construction and ramp up of Line 7
In March 2021, the Company set up a 100-day attack working group for Line 7 project, launched a special
activity of "Production of 100 days to pay tribute to the 100th anniversary of the founding of the Party",
accelerated the progress of chemical test run of Line 7 project, and finally completed the performance stability test
run in July 2021, and started the test run ramp-up. In order to speed up the climbing process of Line 7 project,
effectively promote technical upgrading and customer introduction, and achieve better operating results, the
Company organized the special work of "Striving for 50 days" for mass production ramp up of Line 7 in
mid-November, 2021, focusing on improving the main technical indicators such as speed and yield.
As of December 31, 2021, Line 7 was in the stage of capacity ramp up, the main technical indicators such as
speed and yield were continuously improved, and the introduction of major customer products was progressing
steadily.
4.Organized epidemic prevention and control effectively, and achieved work safety in a stable and orderly
manner
In 2021, the Company attached great importance to epidemic prevention and control and work safety
management, strengthened bottom-line thinking, overcame unawareness and fluke mind, and implemented it
strictly and tightly. First, it organized the work safety inspection of third-party organizations to investigate and
rectify the potential safety hazards of old property equipment assets. Second, it actively implemented the
upgrading and transformation of safety and environmental protection, and practiced the sustainable development
production concept of green environmental protection, energy saving and consumption reduction. SAPO
Industrial Park won the "Outstanding Green Environment-friendly Factory Award" of "Green Asia Pacific 2021
Environmental Protection Achievement Award". Third, it continued to implement the normal management of
epidemic prevention and control, strengthened organizational leadership, and built an epidemic prevention
network in an all-round way. The epidemic prevention and control work special class conducted and coordinated
the effective epidemic prevention mechanism level by level, ensured that all deployment measures were
implemented solidly, and effectively protected the life safety of employees.
5. Insisted on strengthening the foundation, and constantly consolidated the grassroots party building work
In 2021, under the strong leadership of the Party Committee of Shenzhen State-owned Assets Supervision and
Administration Commission and the Party Committee of Shenzhen Investment Holdings, the Party Committee of
the Company adhered to the guidance of Xi Jinping's new era socialism with Chinese characteristics, thoroughly
implemented the spirit of the 19th National Congress of the Communist Party of China and its previous plenary
sessions, firmly grasped the general requirements of party building in the new era, carried out in-depth study and
education of party history, focused on warmly celebrating the 100th anniversary of the founding of the
Communist Party of China (CPC), closely focused on the quality improvement actions of listed companies,
solidly promoted the deployment and implementation of "six-degree party building", and the Company's
high-quality development with high-quality party building.
(2) Revenue and cost
1. Component of Business Income
In RMB
2021 2020 Increase
16
2021 Annual Report
Amount Proportion Amount Proportion /decrease
Total operating revenue 2,293,747,892.06 100% 2,108,964,687.80 100% 8.76%
On Industry
Manufacturing 2,154,422,129.35 93.93% 2,012,255,019.03 95.41% 7.07%
Lease and Management of Property 111,568,500.55 4.86% 85,177,866.03 4.04% 30.98%
Other 27,757,262.16 1.21% 11,531,802.74 0.55% 140.70%
On Products
Lease and Management of Property 111,568,500.55 4.86% 85,177,866.03 4.04% 30.98%
Textile 54,932,578.58 2.39% 60,503,325.78 2.87% -9.21%
Polarizer sheet 2,099,489,550.77 91.53% 1,951,751,693.25 92.54% 7.57%
Other 27,757,262.16 1.21% 11,531,802.74 0.55% 140.70%
Area
Domestic 2,039,625,757.16 88.92% 1,768,190,864.75 83.84% 15.35%
Overseas 254,122,134.90 11.08% 340,773,823.05 16.16% -25.43%
Sub-sale model
Credit 2,154,422,129.35 93.93% 2,012,255,019.03 95.41% 7.07%
Cash on sale 139,325,762.71 6.07% 96,709,668.77 4.59% 44.07%
2.Situation of Industry, Product and District Occupying the Company’s Business Income and Operating Profit
with Profit over 10%
√ Applicable □Not applicable
In RMB
Increase/decrea Increase/decrea
Increase/decrea
se of business se of gross
se of revenue in
Gross profit cost over the profit rate over
Turnover Operation cost the same period
rate(%) same period of the same period
of the previous
previous year of the previous
year(%)
(%) year (%)
On Industry
2,154,422,129. 1,877,251,173.
Manufacturing 12.87% 7.07% 5.10% 1.63%
35 50
Lease and
Management of 111,568,500.55 22,996,155.29 79.39% 30.98% 5.04% 5.09%
Property
On Products
Polarizer sheet 2,099,489,550. 1,828,737,245. 12.90% 7.57% 5.24% 1.95%
17
2021 Annual Report
77 98
Lease and
Management of 111,568,500.55 22,996,155.29 79.39% 30.98% 5.04% 5.09%
Property
Textile 54,932,578.58 48,513,927.52 11.68% -9.21% 0.10% -8.21%
Area
2,039,625,757. 1,692,710,152.
Domestic 17.01% 15.35% 10.46% 3.67%
16 65
Overseas 254,122,134.90 215,809,260.63 15.08% -25.43% -23.44% -2.20%
Sub-sale model
2,154,422,129. 1,877,251,173.
Credit 12.87% 7.07% 5.10% 1.63%
35 50
Cash on sale 139,325,762.71 31,268,239.78 77.56% 44.07% 11.28% 6.61%
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
Classification Items Unit 2021 2020 Changes
Sales 10,000 square meters 2,517.63 2,131.28 18.13%
Polarizer sheet Production 10,000 square meters 2,518.62 2,124.96 18.53%
Stock 10,000 square meters 139.51 121.69 14.64%
Sales 10,000 pieces 269 358 -24.86%
Knitted clothing Production 10,000 pieces 280 385 -27.27%
Stock 10,000 pieces 91 80 13.75%
Explanation for a year-on –year change of over 30%
□ Applicable √ Not applicable
4.Degree of Performance of the Significant Sales Contract Signed up to this Report Period
□ Applicable √Not applicable
5.Component of business cost
Industry category
In RMB
2021 2020
Increase/D
Industry Proportion in Proportion in
Items ecrease
classification Amount the operating Amount the operating
(%)
costs (%) costs (%)
18
2021 Annual Report
Polarizer sheet,
Manufacturing 1,877,251,173.50 98.36% 1,786,199,780.24 98.45% 5.10%
Knitted clothing
Lease and
Rental，
Management of 22,996,155.29 1.20% 21,892,925.24 1.21% 5.04%
Accommodation
Property
Other Other 8,272,084.49 0.43% 6,205,689.54 0.34% 33.30%
In RMB
2021 2020
Classification Proportion in Proportion in Increase/Decre
Items
of products Amount the operating Amount the operating ase (%)
costs (%) costs (%)
Direct 1,460,202,220. 1,469,416,728.
Polarizer sheet 76.51% 80.99% -0.63%
materials 50 04
Polarizer sheet Direct labor 56,423,729.38 2.96% 50,884,076.28 2.80% 10.89%
Polarizer sheet Power cost 49,263,443.02 2.58% 44,834,128.46 2.47% 9.88%
Manufacturing
Polarizer sheet 262,847,853.08 13.77% 172,598,639.68 9.51% 52.29%
cost
Knitted Direct
29,157,370.18 1.53% 29,570,175.97 1.63% -1.40%
clothing materials
Knitted
Direct labor 9,659,820.67 0.51% 10,388,237.67 0.57% -7.01%
clothing
Knitted
Power cost 968,232.62 0.05% 1,256,258.98 0.07% -22.93%
clothing
Knitted Manufacturing
8,728,504.05 0.46% 7,251,535.16 0.40% 20.37%
clothing cost
Note
None
6.Whether Changes Occurred in Consolidation Scope in the Report Period
□ Yes √ No
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 Main Customers
Total sales amount to top 5 customers (RMB) 1,600,042,900.00
Proportion of sales to top 5 customers in 69.76%
Proportion of the sales volume to the top five customers
0.00%
in the total sales to the related parties in the year
19
2021 Annual Report
Information of the Company’s top 5 customers
No Name Amount（RMB） Proportion(%)
1 Customer 1 673,734,600.00 29.37%
2 Customer 2 424,287,100.00 18.50%
3 Customer 3 256,965,400.00 11.20%
4 Customer 4 135,380,400.00 5.90%
5 Customer 5 109,675,400.00 4.78%
Total -- 1,600,042,900.00 69.76%
Other note
□ Applicable √ Not applicable
Principal suppliers
Total purchase of top 5 Suppliers（RMB） 849,718,112.61
Percentage of total purchase of top 5 suppliers In total
44.50%
annual purchase(%
Proportion of purchase amount from the top 5 suppliers
in the total purchase amount from the related parties in 0.00%
the year
Information about the top 5 suppliers
No Name Amount（RMB） Proportion(%)
1 Supplier 1 226,545,838.65 11.86%
2 Supplier 2 191,071,560.06 10.01%
3 Supplier 3 151,236,748.24 7.92%
4 Supplier 4 147,731,715.41 7.74%
5 Supplier 5 133,132,250.24 6.97%
Total -- 849,718,112.61 44.50%
Other note
□ Applicable √Not applicable
(3)Expenses
In RMB
Increase/Dec
2021 2020 Notes
rease(%)
Mainly due to attributable to the purchase of new
Sale expenses 37,973,336.39 28,644,230.87 32.57% material insurance and the increase in sales staff
remuneration.
Administrative 122,088,830.15 105,094,934.36 16.17%
20
2021 Annual Report
expenses
Financial Mainly due to the year-on-year increase in foreign
-130,344.09 8,287,888.28 -101.57%
expenses exchange gains.
R&D Mainly due to the increase in research and
103,508,764.53 67,160,964.22 54.12%
expenses development investment in the current period.
(4) Research and Development
√ Applicable □ Not applicable
Expected impact on the
Name of main R&D Project
Project purpose Goal to be achieved future development of the
project progress
Company
R&D of key
Achieve mass production Realize mass production Enrich the company's
technologies of
of high-performance supply and application of product categories and
high-performance completed
polarizers for large-size domestically produced enhance the company's
polarizer for large-size
display panels TV products product competitiveness
display panel
With the continuous
Some increase of 4K and 8K
Development of POL products have products of panel
to satisfy the market's complete client
Products for TV with passed the manufacturers, the
needs authentication
large size and high PPI client optical development of this project
verification can meet the market
demand for such polarizers
Improve market
Development of thin To achieve large-scale Realize mass production
completed competitiveness in
NB products production of the product supply
notebook computer field
Stabilize the continuous
production process,
determine the production Improve the company's
Product development Meet product entry-level
completed process guideline, and product competitiveness
of vehicle polarizers verification requirements
meet the entry-level and meet customer needs
verification requirements
of the product
Enrich the company's
product categories and
enhance the company's
Development of OLED To achieve large-scale partially Realize mass production
product competitiveness;
TV products production of the product completed supply
lay the foundation for the
subsequent development of
high-optical products
21
2021 Annual Report
Research and
Enrich the company's
application of key
To achieve large-scale Realize mass production product categories and
technologies of completed
production of the product supply enhance the company's
polarizers for IPS
product competitiveness
mobile phone
Technical indicators Promote the localization
R&D of polarizer
Have the production reach a certain level, process of polarizer
technology for OLED completed
capacity of this product with the production products for OLED mobile
mobile phone
capacity of the product phones
Development of OLED to satisfy the market's Complete customer nhance the company's
completed
wearable application needs verification of a product product competitiveness
Development of To achieve large-scale Realize mass production enhance the company's
completed
ultra-wide VA products production of the product supply product competitiveness
Technical indicators
Development of
Have the production reach a certain level, enhance the company's
ultra-wide IPS completed
capacity of this product with the production product competitiveness
products
capacity of the product
Product development Enrich the company's
of black-and-white To achieve large-scale Realize mass production product categories and
completed
display polarizer and production of the product supply enhance the company's
sunglasses product competitiveness
Protect the health of
employees and make due
Development of Fulfill the social Complete product contributions to improving
environment-friendly responsibility of completed development and put into the environment; can
PSA adhesive environmental protection production use achieve stable supply to
customers and relieve
supply risks
Increase production
R&D of key capacity and reduce
The process can meet
technology for satisfy customer's request completed material costs; improve the
mass production supply
polarizer extension company's product
performance
Company's research and development personnel situation
2021 2020 Increase /decrease
Number of Research and Development persons (persons) 145 169 -14.20%
Proportion of Research and Development persons 10.61% 12.34% -1.73%
Academic structure of R&D personnel —— —— ——
Age composition of R&D personnel —— —— ——
The Company's R & D investment situation
22
2021 Annual Report
Increase
2021 2020
/decrease
Amount of Research and Development Investment (In RMB) 103,508,764.53 67,160,964.22 54.12%
Proportion of Research and Development Investment of Operation Revenue 4.51% 3.18% 1.33%
Amount of Research and Development Investment Capitalization (In RMB) 0.00 0.00
Proportion of Capitalization Research and Development Investment of
0.00% 0.00%
Research and Development Investment
Reasons and influence of significant changes in R&D personnel composition of the Company
□ Applicable √Not applicable
The Reason of the Prominent Change in Total Amount of Research and Development Input Occupying the
Business Income Year on Year
□ Applicable √Not applicable
Reasons for the drastic change of capitalization rate of R&D investment and its rationality explanation
□ Applicable √Not applicable
(5)Cash Flow
In RMB
Increase/Decrease(
Items 2021 2020
%)
Subtotal of cash inflow received from operation activities 2,433,304,906.36 2,067,129,172.79 17.71%
Subtotal of cash outflow received from operation activities 2,437,741,886.71 2,065,198,240.03 18.04%
Net cash flow arising from operating activities -4,436,980.35 1,930,932.76 -329.78%
Subtotal of cash inflow received from investing activities 1,154,092,748.71 3,253,008,414.70 -64.52%
Subtotal of cash outflow for investment activities 1,412,622,193.08 3,572,079,379.14 -60.45%
Net cash flow arising from investment activities -258,529,444.37 -319,070,964.44 18.97%
Subtotal cash inflow received from financing activities 339,219,000.00 342,660,000.00 -1.00%
Subtotal cash outflow for financing activities 50,944,964.13 12,855,758.88 296.28%
Net cash flow arising from financing activities 288,274,035.87 329,804,241.12 -12.59%
Net increase in cash and cash equivalents 24,071,196.77 9,690,648.77 148.40%
Notes to the year-on-year change of the relevant data
□ Applicable √ Not applicable
Reasons of major difference between the cash flow of operation activity in report period and net profit of the
Company
√ Applicable □ Not applicable
During the reporting period, the net cash flow from the Company's operating activities was -4,436,980.35
yuan. The net profit in the consolidated statement of the company was 75,114,666.20 yuan, with significant
difference between the two, mainly due to use of credit sales in the form of sales. The difference During the
23
2021 Annual Report
reporting period between the net cash flow generated by the company's operating activities and the net profit of
the consolidated statement is detailed in Section 10, VII, 58 (1) "Supplementary Information on Cash Flow
Statement" of this report.
V.Analysis of Non-core Business
√ Applicable □Not applicable
In RMB
Proportion in Sustainable (yes or
Amount Explanation of cause
total profit no)
Obtaining dividends ， contract fees and Have the
Investment income 22,663,013.06 26.28%
Money fund investment income, etc. sustainability
Mainly due to the changes in the
Gains and losses on Have the
2,150,943.40 2.49% non-current financial assets and Structural
changes in fair value sustainability
deposit value
-83,508,720.3 Mainly from the provision of inventory Have the
Impairment of assets -96.84%
3 depreciation loss. sustainability
Non-operating income 21,285,786.64 24.68% Mainly insurance claims. Not sustainable.
Mainly due to the loss of non-current
Non-operating expense 1,686,263.35 1.96% Not sustainable.
assets being destroyed and scrapped.
Have the
Other income 19,643,379.33 22.78% Mainly for government subsidies.
sustainability
VI.Condition of Asset and Liabilities
(1)Condition of Asset Causing Significant Change
In RMB
End of 2021 End of 2020 Proport
ion
Proportion Proportion
increas Notes to the significant change
Amount in the total Amount in the total
e/decre
assets(%) assets(%)
ase
302,472,828. 279,087,236.
Monetary fund 5.50% 5.62% -0.12%
60 95
Accounts 479,998,708. 547,310,217.
8.73% 11.01% -2.28%
receivable 57 90
667,461,447. 480,847,581.
Inventories 12.14% 9.68% 2.46%
03 44
Investment real 106,217,779. 110,572,471.
1.93% 2.23% -0.30%
estate 76 92
24
2021 Annual Report
Long-term
133,022,325. 147,929,137.
equity 2.42% 2.98% -0.56%
77 23
investment
2,424,741,25 790,183,905. Mainly due to the transfer of the
Fixed assets 44.11% 15.90% 28.21%
2.86 38 Line 7 project.
Construction in 71,482,031.0 1,301,750,14 -24.89 Mainly due to the transfer of the
1.30% 26.19%
process 8 1.12 % Line 7 project.
Use right assets 9,221,189.37 0.17% 0.17%
Short-term 37,575,113.8
0.68% 0.68%
borrowing 3
This was mainly due to the increase
Contract
68,955.21 0.00% 279,631.27 0.01% -0.01% in loans borrowed for the Line 7
liabilities
project during the year.
Long-term 683,016,243. 343,100,174.
12.43% 6.90% 5.53%
borrowing 25 35
Lease liabilities 4,243,855.71 0.08% 0.08%
Transaction 586,540,735. 684,617,260.
10.67% 13.78% -3.11%
financial assets 16 06
Mainly due to the payment of
Other 140,185,750.
2.55% 5,265,002.71 0.11% 2.44% customs deposits for newly imported
receivables 40
raw materials.
Overseas assets account for a relatively high proportion.
□ Applicable √ Not applicable
(2)Asset and Liabilities Measured by Fair Value
√Applicable □ Not applicable
In RMB
Gain/Loss
on fair Cumulative Impairment Purchased Sold
value fair value provisions amount in amount in
Opening Other Closing
Items change in change in the the the
amount changes amount
the recorded reporting reporting reporting
reporting into equity period period period
period
Financial
assets
1. Financial
assets
684,617,260.0 712,000,000.0 810,076,524.9 586,540,73
measured at
6 0 0 5.16
fair value
through
25
2021 Annual Report
profit or
loss
(excluding
derivative
financial
assets)
4．Other
equity 190,607,427.5 186,033,82
-4,573,597.82
Instrument 4 9.72
Investment
Subtotal of
875,224,687.6 712,000,000.0 810,076,524.9 772,574,56
financial -4,573,597.82 0.00 0.00
0 0 0 4.88
assets
non-current
30,650,943.
financial 30,650,943.40 2,150,943.40 2,150,943.40
40
assets
905,875,631.0 712,000,000.0 812,227,468.3 803,225,50
Total 2,150,943.40 -4,573,597.82 0.00 0.00
0 0 0 8.28
Financial
0.00 0.00
Liability
Other changes
None
Did great change take place in measurement of the principal assets in the reporting period ?
□ Yes √ No
(3) Restricted asset rights as of the end of this Reporting Period
Subsidiary SAPO Photoelectric uses part of its self-owned properties to apply for a mortgage loan from a
syndicate with Bank of Communications Co., Ltd. Shenzhen Branch as the lead bank, and the company provides
guarantees for the mortgage loan. For details, please refer to http://www.cninfo.com.cn .cninfo.com.cn)
"Announcement on the Company's Application for Bank Mortgage Guarantees for Subsidiaries" (No. :2020-19),
"Announcement on the Progress of the Company Providing Guarantees for Subsidiaries"(No.:2020-46)
VII. Investment situation
(1) General
□ Applicable √Not applicable
(2)Condition of Acquiring Significant Share Right Investment during the Report Period
□ Applicable √Not applicable
26
2021 Annual Report
(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
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
Propor
Amount
tion of
of raised Total
Total Accumulat raised Amount
capital Amount Use and
amount ive amount capital of the
Total of which of the Whereas
of the of raised of Raised
Total amount the Unused outs of
Year of Way of raised capital of which Fund
raised of purpose Raised the
raising raising fund which the the with
capital Raised was Fund at Unused
used at purpose purpos over 2
Funds changed the Raised
the has been e has Years’
in the Current Fund
period changed been Idling
report Period
chang
period
ed (%)
Transfer
to the
compan
y's own
Non-pub 32.16 account
2013 96,175.1 0.26 76,261.7 0 30,927.22 1,228.01
lic issue % for
permane
nt
replenis
hment of
27
2021 Annual Report
working
capital
32.16
Total -- 96,175.1 0.26 76,261.7 0 30,927.22 1,228.01 -- 0
%
Note to use of raised capital
During the reporting period, the Company actually used the raised funds of 2,600 yuan, and the accumulated use of raised funds
was 762.617 million yuan, of which 100 yuan of raised funds was actually used for the second phase of the line 6 project of
TFT-LCD polarizer-and the accumulated use of raised funds for it was352.6635 million yuan; the actual use of the raised funds
for the 7th line project was 2,500 yuan, with the accumulated use of raised funds for it was 409.9535 million yuan.
2. Promised projects of raised capital
√ Applicable □ Not applicable
I n RMB10,000
Date
Accum Invest
when Has
ulated ment
Project the any
Total Total Amoun amount progres Has the
change project Benefit materia
raised invest t investe s ended predict
d has realize l
Committed capital ment investe d at the the ed
(includi reached d in the change
investment projects investe after d in the end of reporti result
ng the reporti taken
and investment d as adjust reporti the ng be
partial predict ng place
commit ment ng reporti period( realize
change ed period in
ted (1) period ng d
) applica feasibil
period( %)(3)=
ble ity
2) ( 2)(1)
status
Committed investment projects
Phase-II project of
96,175. 35,266. June 6,337.6
polarizer sheet for Yes 70,034 0.01 50.36% No Yes
1 35 7,2018 3
TFT-LCD (Line 6)
The utilization of the July Not
40,995. -10,718
surplus raised funds No 0.25 11,202 applica No
35 .52
（Line 7 project） 1 ble
Subtotal of
96,175. 76,261. -4,380.
committed -- 70,034 0.26 -- -- -- --
1 7 89
investment projects
Subtotal of committed investment
None
96,175. 76,261. -4,380.
Total -- 70,034 0.26 -- -- -- --
1 7 89
28
2021 Annual Report
Situation about not
coming up to
schemed progress or
Not applicable
expected revenue
and the reason ( in
specific project)
According to the latest situation of the industry development, the original second phase construction
scheme of the TFT-LCD polarizer was optimized, and then according to the results concluded by the
experts, the company decided to continue to promote the construction of the No.6 line project. At the
same time, in the light of there was a large funds gap between the actual raised capital and the planned
Notes to significant
raised capital for the second phase project, then by comprehensive considerations of the company’s
change in feasibility
production line scale and the operation pressure, the company decided to terminate the project of No.7
of the project
line, and the corresponding amount of funds of 309.2722 million yuan(including interests) for No.7 line
project shall be changed for permanently supplementing the liquidity. The Proposal on Alteration of the
Use of Part of the Raised Capital for the Second Phase Project of TFT-LCD Polarizer was examined and
approved in the 2015 annual shareholder meeting on April 21, 2016..
Amount, application
and application
Not appli8cable
progress of the
uncooked proceeds
About the change of
the implementation
site of the projects Not appli8cable
invested with the
proceeds
Adjustment of the
implementation way
Not appli8cable
of investment funded
by raised capital
About the initial
investment in the
projects planned to
Not appli8cable
be invested with the
proceeds and the
replacement
Using the idle
proceeds to
supplement the Not appli8cable
working capital on
temporary basis
Balance of the Applicable
proceeds in process 1.On August 31, 2018, in the company's second extraordinary shareholders’ meeting of 2018, the
29
2021 Annual Report
of project “Proposal on the Use of Surplus Raised Funds to Invest in the Large-scale TV Polarizer Industrialization
implementation and Project (Line 7)” was reviewed and approved, agreeing to continue to deposit 134.7172 million yuan in
the cause the original special account of raised funds for the follow-up expenditure of line 6 project and the
remaining surplus raised funds shall be used for the investment of line 7 project, with the amount shall
be subject to the interest settlement of the bank on the day the funds are transferred out. According to the
use arrangement for the surplus raised funds, on November 12, 2018, the Company transferred the
surplus raised funds for the No. 6 line project by 405.8311 million yuan to the newly opened special
account of raised funds for project of Line 7, which will be used for the ultra-large-size TV polarizer
industrialization project (Line 7), and as of November 12, 2018, the balance of the special account for
raised funds of line 6 was 80.3569 million yuan.
The reasons for the surplus of the raised funds were as follows: 1. the interest income and the investment
income of the bank wealth management products were generated during the deposit of the raised funds;
2.to grasp the opportunity of the rapid development of the domestic polarizer industry and accelerate the
construction of the No. 6 line project, the Company had in advance invested some funds in the second
phase of the polarizer project of Line 6, and in view of the fact that the funds raised at the time were in
place, as there was a large funding gap between the actual raised funds and the planned and the original
investment project needed to be re-demonstrated, the Company did not replace the advance investment
in time after the raised funds were received; 3. the second phase of the polarizer project was subsidized
by the National Development and Reform Commission and the Shenzhen Municipal Government after
the project was established ,which had been all put into the project construction according to the
requirements, thereby reduced the investment of the raised funds accordingly; 4. to ensure the original
investment project to have a good market prospect and profitability, the Company optimized the
construction plan of the original raised-funds investment project of No. 6 line, and it adopted the cost
control, optimized the production process and took other measures to achieve reasonable savings under
the premise of ensuring the original design and technical conditions of the project.
2. On March 10, 2021, the Company held the second meeting of the Eighth Board of Directors, which
deliberated and approved the Proposal on the Permanent Replenishment of Working Capital with Surplus
Raised Funds. In view of the completion of Line 6 of the phase II project of polarizer for TFT-LCD, the
surplus raised funds of Line 6 of RMB 12,280,100 (including the accumulated net amount of bank
deposit interest minus bank fees and RMB 7,307,100 of equipment balance) will be used to permanently
replenish working capital for daily production and operation use.
The reasons for the surplus of the raised funds are as follows:
1. During the implementation of Line 6 project, the Company strictly followed the relevant regulations
on the use of raised funds, carefully used the raised funds, strengthened the cost control, supervision and
management during the project construction and initial operation on the premise of ensuring the quality
of raised investment projects, reasonably reduced the project investment amount and initial working
capital, and saved the expenditure of raised funds;
During the implementation of the project, idle raised funds generated certain interest income.
By December 31, 2021, the Line 6 project had been closed, and the surplus raised funds of special
About application account of RMB 12,280,100 was transferred to the Company's own account for permanent
and status of the replenishment of working capital. On March 29, 2021, the bank cancellation procedure for special
proceeds unused account of Line 6 was completed. All the raised funds in the special account of Line 7 project have been
used as required, and the bank cancellation procedures for special account of Line 7 were completed on
30
2021 Annual Report
March 29, 2021.
By December 31, 2021, the phase II of Line 6 project had accumulated investment of RMB 699,544,200,
Problems existing in
accounting for 99.89% of the changed total investment of RMB 700,340,000, of which the actually paid
application of the
investment was RMB 689,650,000 (RMB 352,663,500 of raised funds and RMB 336,986,500 of
proceeds and the
self-owned funds and government funds).
information
By December 31, 2021, the accumulative investment contract amount of Line 7 project was RMB
disclosure or other
2,091,244,100, and the actual payment was RMB 2,017,518,400 (RMB 409,953,500 of raised funds,
issues
RMB 1,607,564,900 of self-owned funds and government funds).
3. Changes of raised funds projects
□ Applicable √ Not applicable
None
VIII. 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
IX. 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 Main Registered Total Operating
Type Net assets Turnover Net Profit
name business capital assets profit
Domestic
Shenzhen
Trade,
Lisi 2,360,000. 35,749,173 28,821,110 9,073,086. 2,255,295. 2,356,126.
Subsidiary Property
Industrial 00 .47 .35 79 59 60
manageme
Co., Ltd.
nt
Accommo
Shenzhen
dation, 10,005,300 22,050,733 20,368,204 6,926,914.
Huaqiang Subsidiary 298,548.24 285,092.35
business .00 .79 .89 89
Hotel
center;
31
2021 Annual Report
Shenzhen
Shenfang Property
1,600,400. 11,649,993 6,951,045. 21,854,935 3,368,024. 2,518,397.
Real Estate Subsidiary manageme
00 .83 03 .99 11 08
Manageme nt
nt Co., Ltd.
Production
Shenzhen of fully
Beauty electronic
13,000,000 46,067,490 18,072,122 55,169,650
Century Subsidiary jacquard 630,605.93 545,674.66
.00 .40 .93 .79
Garment knitting
Co., Ltd. whole
shape
Production
SAPO
and sales 583,333,33 4,237,652, 2,858,788, 2,128,258, 38,497,930 40,484,325
Photoelectr Subsidiary
of 3. 00 544.02 617.26 070.01 .46 .87
ic
polarizer
Shenzhen
Operating
Textile
import and 5,000,000. -150,452.3 12,833,113
Import & Subsidiary 0.00 0.00 0.00
export 00 7 .61
Export Co.,
business
Ltd.
Shengtou
Sales of HKD10,00 6,009,898. 5,984,077. -155,168.2
（HK）Co., Subsidiary 0.00 118,818.86
polarizer 0 07 83 0
Ltd.
Shenzhen
Shenfang
Property
Sungang 10,248,835 8,274,062. 4,297,226. 2,387,107. 2,222,849.
Subsidiary manageme 1,000,000
Real Estate .38 49 09 59 16
nt
Manageme
nt Co., Ltd.
Subsidiaries obtained or disposed in the reporting period
√ Applicable □ Not applicable
Means of acquisition and disposal of Impact on overall production, operation and
Company name
subsidiaries during the reporting period performance
The purpose of this cancellation of the
subsidiary is to improve the operational
Shenzhen Textile Import
Withdraw efficiency of state-owned assets, and the impact
& Export Co., Ltd.
on the current profit and loss of the company is
7.6999 million.
Note
The financial data of SAPO Photoelectric mentioned in the table above are the financial statements data of its
32
2021 Annual Report
parent company and non-consolidated statements data. Shenzhen Textile Import & Export Co., Ltd. , Shengtou（HK）
Co., Ltd.are SAPO Photoelectric.
For details of the fluctuation of subsidiary SAPO Photoelectric's performance and the reasons for the change,
please refer to "IV. Analysis of main business" in Section III Management Discussion and Analysis.
X.Structured vehicle controlled by the Company
□ Applicable √ Not applicable
XI. Prospect for future development of the Company
1. The Development Trend of the Industry
(1) Industry competition pattern
Polarizer industry is a highly concentrated industry. Currently, there are about 10 major polarizer manufacturers
worldwide, mainly in Japan, mainland China, South Korea and Taiwan Province of China. The main market share
is occupied by Japanese and Chinese mainland manufacturers, while the overall production capacity of South
Korea and Taiwan Province is low.
(2) Industry trends
In recent years, Chinese mainland's new display industry has always maintained positive growth, its overall
growth rate has exceeded the global industrial growth rate for many years, its industrial structure has been
constantly improved, and its market competitiveness has been steadily improved. Relying on several TFT-LCD
panel production lines, the LCD panel industry in mainland China ranks first in the world in terms of revenue and
shipping area. Compared with the rapid development of new display industry in mainland China, overseas
manufacturers choose to gradually shrink and withdraw, for example, Samsung Display sells its LCD panel
production line and LG Chem sells its LCD polarizer business. With the withdrawal of foreign manufacturers,
high-quality industrial assets are transferred to mainland China, and the focus of the new display industry is
accelerating to concentrate in mainland China. According to the latest research of Omdia, it is estimated that from
2023, the capacity area share of Chinese mainland manufacturers will reach more than 70% of the global total.
Affected by this, the market demand for polarizers in Chinese mainland has increased rapidly in recent years.
According to Omdia research, driven by the development of display panel industry, the global total demand area
for polarizers is expected to increase from 574 million square meters in 2020 to 669 million square meters in 2025,
and the domestic market demand area for polarizers will reach 480 million square meters by 2025, accounting for
more than 70% of the global total demand. It is a good development opportunity for mainland polarizer
manufacturers with market advantages, policy advantages and geographical advantages.
2. Company development strategy
Relying on the existing business foundation, the Company will actively plan for business innovation and
upgrading through two paths of tapping the potential of stock business and increasing business investment and
empowerment, vigorously implement the "polarizer+" strategy, promote the core business of polarizers to become
better and stronger, and meanwhile, choose the right opportunity to extend to upstream raw materials, promote the
development of polarizer integration business, actively expand other advanced new material fields, and strive to
build a world-class new material technology group.
3. Possible risks
(1) Macro economic risk
33
2021 Annual Report
As the COVID-19 is still spreading all over the world, there are still weak links in the prevention and control of
domestic pandemic, the foundation of economic recovery is still not solid, the consumption of residents is still
restricted, and the domestic demand economy will continue to be under pressure. As a member of the upstream
manufacturers in the monitor market, the Company can't rule out the risk that unpredictable macroeconomic
fluctuations may affect the Company's performance.
(2) Market risk
The polarizer industry is an important part of China's future manufacturing development. The demand for
display panels and the development of corresponding technologies are changing quickly. However, the domestic
substitution process of the polarizer industry is under way. With the gradual mass production of the 10.5
generation line, the super-large size market will usher in new changes. If the Company's technology and products
can't respond to the needs of application fields in time, the wide polarizer products and applications fall short of
expectations, or the market competition intensifies, which leads to the price reduction of display products and the
upward transmission of the price reduction pressure to the polarizer market, it will have an adverse impact on the
Company.
(3) Risk of raw materials
There is a high barrier in the core production technology of upstream materials of polarizers, which is basically
monopolized by foreign manufacturers, with low localization rate. Currently, the key raw materials for
manufacturing polarizers, such as PVA film and TAC film, are basically monopolized by Japanese enterprises, and
the production line and production technology of upstream supporting raw materials are constrained by Japan,
while the prices of major film materials are affected by the supplier's capacity, market demand and yen exchange
rate, which affects the unit cost of the Company's products.
(4) Work priorities in 2022
1. Continue to improve the profitability of the main business
Vigorously implement the four measures of "capacity scale, product differentiation, innovation ecology, and lean
management". First, further promote the oversized production capacity of the Company's polarizer business and
improve the overall production capacity; Second, promote product differentiation, strengthen the technical
research on OLED polarizers, vehicle polarizers and other products, and continuously optimize the product
structure; Third, promote the ecological innovation and build a standardized and efficient market-oriented R&D
management system; Fourth, promote lean management, improve product quality and production efficiency, and
adopt diversified measures to reduce costs and increase efficiency.
2. Promote the ramp-up mass production process of Line 7 project
Ensure the maximum continuous production of Line 7 project, make every effort to shorten the ramp up time of
the production line, and promote the production with full activation of production line. First, strengthen market
expansion and obtain orders for large-size products; Second, continuously improve speed and yield; Third, ensure
the supply of raw materials.
3. Ensure the steady growth of property business and provide effective support for the development of the
Company
Property management enterprises shall closely follow the changes of the surrounding business types, operate
around the rental rate and capital recovery rate, overcome the problems of old property, poor conditions and
backward facilities, continue to tap potential and increase efficiency, improve service level and enhance operating
34
2021 Annual Report
efficiency.
4. Carry out refined management in an all-round way, and create a resource-efficient enterprise
Define the management goal of tapping potential and increasing efficiency, and fully implement refined
management. For production, quality, inventory, sales and other aspects, refine management units, improve
management methods, achieve refinement, quantification and standardization of management, steadily enhance
the Company's market competitiveness, and create a resource-efficient enterprise with "high efficiency, low
consumption and fine management".
5. Further deepen the market-oriented talent management mechanism
Reorganize the echelon of reserve talents for key positions, improve the management mechanism of selection,
training and assessment of reserve talents, introduce talents through multiple channels, train in multiple ways,
conduct multi-directional assessment, innovate the talent management mechanism, build a platform for talent
selection and employment, and provide sound human resources support for the sustainable development of the
Group.
6. Well ensure epidemic prevention and control and work safety, and maintain the harmony and stability of the
enterprise
First, enhance employees' awareness of health protection, insist on fully ensuring epidemic prevention and
dynamic data in key places, and well ensure normalized prevention and control of COVID-19 to ensure neglecting
neither epidemic prevention nor production. Second, strengthen the boundary line awareness, firmly establish the
concept of safe development, solidly carry out safety management, speed up the reform and innovation of safety
supervision, implement the safety responsibility system to the letter, deepen the investigation and management of
hidden dangers, continuously improve the Company's work safety management level, and build a strong safety
management foundation.
7. Strengthen party building and innovate enterprise culture
Guided by Xi Jinping's thought of socialism with Chinese characteristics in the new era, fully implement the
spirit of the Sixth Plenary Session of the Nineteenth CPC Central Committee and the 20th CPC National Congress,
continue to carry out in-depth study of party history, adhere to the guidance of high-quality party building to
guarantee high-quality development unswervingly, and further push forward the "six-degree party building" work
in a down-to-earth manner to protect the Company's sustained and healthy development.
XII. Particulars about researches, visits and interviews received in this reporting period
√ Applicable □Not applicable
The main
content of the
Index of the basic
Reception Reception The way of Object type of Reception discussion and
situation of the
time place reception reception person the
survey
information
provided
Meeting room The main For details, please
March Great Wall
on the sixth Field research Organization reasons for the refer to the "000045
18,2021 securities
floor of the quarter-on-qua Shenzhen Textile A
35
2021 Annual Report
Company rter increase in Research Activity
the Company's Information
gross profit 20210319" (No.
margin in the 2021-01) by the
first three company
quarters and http://www.cninfo.c
the price of om.cn.
polarizers, the
release of
production
capacity of
Line 7, etc.
The
Company's
provision for
inventory
depreciation,
the Company's
polarizer
business gross
profit margin,
the Company's
For details, please
operating
refer to the "000045
conditions in
Shenzhen Textile A
the first
Meeting room Research Activity
quarter, the
March on the sixth The majority Information
Other Other main reasons
25,2021 floor of the of investors 20210325" (No.
for the
Company 2021-02) by the
increase in the
company
cost of
http://www.cninfo.c
polarizer
om.cn.
materials, and
the impact of
the epidemic
on the
Company's
performance
due to the
reduction of
rent affected
by epidemic.
Meeting room Asset For details, please
Great Wall
Aptil2,2021 on the sixth Field research Organization impairment refer to the "000045
securities
floor of the information in Shenzhen Textile A
36
2021 Annual Report
Company 2020 and Research Activity
2021, reasons Information
for lower 20210406" (No.
gross profit 2021-03) by the
margins than company
other http://www.cninfo.c
companies, om.cn.
and the
progress of
Line 7
production,
etc.
The
Company's
production
capacity, the
production
For details, please
progress of
refer to the "000045
Line 7, the
Shenzhen Textile A
main products
Meeting room Fuhua Research Activity
produced by
on the sixth Securities, Information
April 8,2021 Field research Organization Line 7, the
floor of the Sinolink 20210409" (No.
Company's
Company Securities 2021-04) by the
advantages in
company
polarizer
http://www.cninfo.c
production,
om.cn.
and the overall
supply and
demand of the
polarizer
industry.
The future
development
For details, please
trend and
refer to the "000045
price trend of
Shenzhen Textile A
the polarizer
Meeting room Research Activity
industry,
on the sixth Great Wall Information
July 15,2021 Field research Organization whether there
floor of the securities 20210716" (No.
will be excess
Company 2021-05) by the
production
company
capacity in the
http://www.cninfo.c
polarizer
om.cn.
industry, the
Company's
37
2021 Annual Report
measures to
reduce costs,
the price of
upstream raw
materials, the
progress of
Line 7, the
progress of the
Company's
employee
stock
ownership
plan, etc.
The
Company's
operation in
Great Wall the first half of
securities,Chin the year, the
a Merchants impact of
For details, please
Fund, panel prices
refer to the "000045
Changsheng on the price of
Shenzhen Textile A
Fund, polarizers,
Meeting room Research Activity
Penghua whether
September on the sixth Information
By phone Organization Fund, polarizaers
1,2021 floor of the 20210902" (No.
Shenwan will lead to
Company 2021-06) by the
Fund, China excess
company
Intemational production
http://www.cninfo.c
Fund, China capacity, the
om.cn.
Everwin Asset current
and Dacheng product
Fund. structure, and
the customers
of Line 7
products.
The
For details, please
Company's
refer to the "000045
positioning
Shenzhen Textile A
Meeting room Cedar capital, and
Research Activity
September on the sixth Rongwei Jiye development
Field research Organization Information
7,2021 floor of the Asset direction in
20210908" (No.
Company Management the next few
2021-07) by the
years, the
company
impact of the
http://www.cninfo.c
decline in
38
2021 Annual Report
panel prices om.cn.
on the trend of
polarizer
prices, the
reasons for the
lower gross
profit margin
compared to
other
manufacturers,
the Company's
product
structure, etc
The situation
of Line 7 and
its main
customers, For details, please
suppliers of refer to the "000045
upstream raw Shenzhen Textile A
Meeting room Fangzheng materials for Research Activity
September on the sixth Securities, polarizers, Information
Field research Organization
17,2021 floor of the Xinda Aoyin reasons for the 20210922" (No.
Company Fund Company's 2021-08) by the
low gross company
profit margin, http://www.cninfo.c
and the om.cn.
Company's
plan to change
its name.
The reasons
why the
Company's
For details, please
performance
refer to the "000045
has increased
Shenzhen Textile A
significantly
Meeting room Research Activity
compared with
September on the sixth Chuangjin Information
Field research Organization previous
23,2021 floor of the Hexin Fund 20210926" (No.
years, the
Company 2021-09) by the
reasons why
company
the Company's
http://www.cninfo.c
gross profit
om.cn.
margin is
lower than
that of
39
2021 Annual Report
comparable
manufacturers,
the main
factors that
affect the
relative high
price of
polarizers.
The
Company's
measures to
deal with the
For details, please
downward
refer to the "000045
revision of the
Shenzhen Textile A
Great Wall panel market,
Meeting room Research Activity
securities, the Company's
October on the sixth Information
Field research Organization Yinhua Fund, main
27,2021 floor of the 202101029" (No.
Xinda Aoyin customers, the
Company 2021-10) by the
Fund Company's
company
product
http://www.cninfo.c
structure, the
om.cn.
main products
of Line 7, the
progress of
Line 7, etc.
Operating
conditions in
the third
Great Wall quarter of
securities, 2021, the
For details, please
Yimin Fund, impact of the
refer to the "000045
Zheshang panel price
Shenzhen Textile A
Securities , revision on the
Meeting room Research Activity
China Company's
November on the sixth Information
Field research Organization Everwin polarizer
2,2021 floor of the 20211103" (No.
Asset, price, the
Company 2021-11) by the
Sinolink ramp-up
company
Securities, progress and
http://www.cninfo.c
Shenwan yield of Line
om.cn.
Assets 7, and the
Management Company's
development
plan in the
field of
40
2021 Annual Report
polarizers.
The
Company's
future plan for
the
development
of the
For details, please
polarizer
refer to the "000045
business, the
Shenzhen Textile A
specific
Meeting room Research Activity
products of
November on the sixth Information
Field research Organization Cedar capital the Company's
4,2021 floor of the 20211104" (No.
polarizers for
Company 2021-12) by the
OLEDTV, the
company
research and
http://www.cninfo.c
development
om.cn.
progress of
vehicle
products, and
the Company's
cost reduction
measures.
Suppliers of
upstream raw
materials, For details, please
measures refer to the "000045
taken by the Shenzhen Textile A
Meeting room Company to Research Activity
Runyingda,
November on the sixth reduce costs, Information
Field research Organization Zhengrui
23,2021 floor of the composition 20211125" (No.
Huadao
Company of B-end 2021-14) by the
customers and company
C-end http://www.cninfo.c
customers of om.cn.
downstream
products, etc.
The main For details, please
reasons for the refer to the "000045
Meeting room
Guotai Junan, improvement Shenzhen Textile A
November on the sixth
Field research Organization Lingzhan of the Research Activity
24,2021 floor of the
Capital Company's Information
Company
operating 20211125" (No.
performance, 2021-15) by the
41
2021 Annual Report
the Company's company
main http://www.cninfo.c
customers and om.cn.
product
structure, the
main matching
panel
production
lines of Line
7, the
relationship
between panel
prices and
polarizer
prices, etc.
42
2021 Annual Report
IV. Corporate Governance
I. General situation
During the reporting period, the Company operated in strict accordance with the requirements of relevant laws,
regulations and normative documents, such as Securities Law, Company Law, Governance Guidelines for Listed
Companies, Guidelines for Self-discipline Supervision of Listed Companies in Shenzhen Stock Exchange
No.1-Standard Operation of Listed Companies on Main Board, and strengthened risk management and control to
ensure the healthy and stable development of the Company. At present, the Company is with basically sound
governance systems, standardized operation, and refined corporate governance structure, which meets the
requirements of the normative documents on the governance of listed companies issued by China Securities
Regulatory Commission.
In 2021, company held a total of 4 general meetings, convened general meetings, standardized voting procedures
to safeguard the effectiveness and legality in strict accordance with the regulations and requirements of
Corporation Law, Articles of Corporation and Rule of Procedure of Shareholders' Meeting. Companies actively
protected the voting rights of minority investors, and general meetings were convened in the form of live network
to adequately assure small investors of their rights to exercise.
In 2021, the board of directors held 11 meetings, and the convening and voting procedures were all conducted in
strict accordance with the Articles of Corporation and Rule of Procedure of Shareholders' Meeting. All the
directors performed directors ' duties, exercise directors ’ rights, attended related meetings and actively
participated in the training and became familiar with relevant laws and regulations with serious, diligent and
honest attitudes. Independent directors independently performed their duties in strict accordance with Articles of
Corporation, The independent director system and other relevant laws and regulations, expressed fully their
independent opinions on corporate operation, decision-making, and important matters, etc. Strategy, audit,
remuneration, evaluation, nomination committees were established under board of directors, all committees
functioned properly, and performed duties such as internal audits, compensation assessment, nomination of senior
management personnel, and provided scientific and professional advisory opinions for board of directors ’
decision-making.
In 2021, the board of supervisors held 9 meetings. The board of supervisors strictly followed the requirements of
Articles of Corporation and Rules of procedure of the board of supervisors and other relevant laws and regulations,
supervised the legal compliance of the duties performed by company's financial personnel and directors, managers
and other senior management personnel in the aim of maintaining the legitimate rights and interests of the
company and its shareholders. All the supervisors fulfilled their obligations, exercised their rights according to the
laws. The convening and voting procedures of the board of supervisors were legal, and the resolutions were legal
and valid. The establishment and implementation of board of supervisors played an active role in improving
corporate governance structure and regulating corporate operations.
Moreover, the Company carried out the special work Blue Sky Action according to Notification on
Implementing Special Work where Investors Protect Blue Sky Action published by Shenzhen Securities Bureau to
enhance the quality of information disclosure as the key point, to continuously perfect the communication
mechanism and to promote the normative development of the Company. various platforms were made full use of,
such as telephone, e-mail, website, especially the interactive platform of investors in Shenzhen Stock Exchange,
solved questions brought by investors, and communicated with medium and small investors interactively, and
ensure all the investors obtained equal opportunities for informal access. Meanwhile, in the aim of improving the
transparency of listed companies, company accepted investors’ on-site investigation to have comprehensive
43
2021 Annual Report
understandings of the company's business situation through face-to-face communication with management, also
urged the company established a responsibility to return on investors, improved and enhanced the corporate
governance standards. Meanwhile, the Company continued to perfect the voting mechanism for minority investors.
In 2021, the minority investors’ voting was counted separately at each of the 4 shareholder’ s meetings, and whose
result was disclosed at the decision announcement at the shareholder’s meeting, which fully guaranteed the
execution of power of the minority investors
In 2021, according to the State Council's Opinions on Further Improving the Quality of Listed Companies (GF
[2020] No.14) and the Shenzhen Securities Regulatory Bureau's Notice on Promoting Listed Companies in
Jurisdiction to Implement Main Responsibilities, Improve Governance Level and Achieve High Quality
Development (SZJGS Zi [2020] No.128), the Company actively formulated self-inspection work plans, organized
directors, supervisors and senior management personnel of the Company and important subsidiaries to carry out
special study, set up special working groups to implement self-inspection, found out potential risks and
outstanding problems that restrict the quality improvement of the Company, and formulated feasible follow-up
rectification plans. The Company has reported the Self-inspection Report and Rectification Plan on Implementing
Main Responsibility, Improving Governance Level and Achieving High-quality Development to Shenzhen
Securities Regulatory Bureau, and will push forward the quality improvement of listed companies according to the
above rectification plan.
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 code of conduct of the controlling shareholders of the company did not go beyond the general meetings
directly or indirectly to interfere with the decision-making and business activities, the company had independent
and complete business and autonomous operation capacity , achieved “five point separation” in respect of
personnel, financial, asset, agencies, business.
III. Competition situations of the industry
□ Applicable √ Not Applicable
IV. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period
1.Annual General Meeting
Investor
Sessions Type of meeting Meeting Date Disclosure date Disclosure index
participation ratio
The First Provisional http://www.cninfo.
provisional shareholders’ 49.30% February 2,2021 February 3,2021 com.cn）
shareholders’ General meeting Announcement
44
2021 Annual Report
General meeting No.:2021-11
of 2021
The Second
http://www.cninfo.
provisional Provisional
com.cn）
shareholders’ shareholders’ 49.27% February 10,2021 February 10,2021
Announcement
General meeting General meeting
No.:2021-14
of 2021
http://www.cninfo.
2020 Annual
com.cn）
Shareholders’ Shareholders’ 49.31% April 7,2021 April 8,2021
Announcement
general meeting General Meeting
No.:2021-31
The Third
http://www.cninfo.
provisional Provisional
com.cn）
shareholders’ shareholders’ 49.46% June 9,2021 June 10,2021
Announcement
General meeting General meeting
No.:2021-40
of 2021
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √Not applicable
45
2021 Annual Report
V. Information about Directors, Supervisors and Senior Executives
(1)Basic situation
Num
The Num
ber Reas
Num numb ber
of ons
Share ber er of of
share for
Starti Expir s of share share
s Other incre
ng y held restri s s
Offic Stock reduc chan ase
Nam Positi date date at the cted held held
e Sex Age optio ed in ges(s or
e ons of of year- share in the at the
status ns the hares decre
tenur tenur begin s curre end
curre ) ase
e e (shar grant nt of the
nt of
e) ed(sh perio perio
perio share
ares) d(sha d(sha
d(sha s
res) res)
res)
Boar
d
chair
man
n， Febru Febru
Zhan
Secre In Fema ary ary
g 42 0 0 0 0 0 0 0
tary y office le 10,20 9,202
Jian
of the 21 4
party
com
mitt
ee
Depu
ty
Secre
tary
of the
Party Febru
Zhu July
com In ary 133,5 110,2 40,50 93,00
Meiz Male 57 9,201 0 0 0
mi office 9,202 00 50 0 0
hu 7
ttee， 4
Direc
tor,
Gene
ra l
Mang
46
2021 Annual Report
er
Direc
tor ,D
eputy
Secre Dece Febru
Ning
tary In mber ary 36,60 36,60 36,60
Maoz Male 46 0 0 0 0
of the office 14,20 9,202 0 0 0
ai
Party 17 4
com
mitte
e
Febru Febru
Yin Direc In ary ary
Male 47 0 0 0 0 0 0 0
Kefei tor office 10,20 9,202
21 4
Janua Febru
Direc
He In ry ary
tor ,C Male 44 0 0 0 0 0 0 0
Fei office 16,20 9,202
FO
20 4
Febru Febru
Sun
Direc In ary ary
Ming Male 40 0 0 0 0 0 0 0
tor office 10,20 9,202
hui
21 4
Indep
Febru
He ende July
In ary
Zuow nt Male 59 19,20 0 0 0 0 0 0 0
office 9,202
en Direc 17
4
tor
Indep
Febru
Cai ende July
In ary
Yuan nt Male 52 19,20 0 0 0 0 0 0 0
office 9,202
qing Direc 17
4
tor
Indep
Janua Febru
ende
Wang In ry ary
nt Male 38 0 0 0 0 0 0 0
Kai office 16,20 9,202
Direc
20 4
tor
Chair Janua Febru
Ma man In ry ary
Male 55 0 0 0 0 0 0 0
Yi of the office 16,20 9,202
super 20 4
47
2021 Annual Report
visor
y
com
mitte
e,
Secre
tary
of the
Com
missi
on
for
Disci
pline
Inspe
ction
Share
Janua Febru
Yuan holde
In ry ary
Shuw rs' Male 41 0 0 0 0 0 0 0
office 16,20 9,202
en Super
20 4
visor
Empl Febru Febru
Zhan
oyee In Fema ary ary 16,80 16,80 16,80
Lume 52 0 0 0 0
super office le 10,20 9,202 0 0 0
i
visor 21 4
Senio Septe Febru
Le
r In mber ary 36,60 36,60 36,60
Kunji Male 58 0 0 0 0
advis office 24,20 9,202 0 0 0
u
er 21 4
Febru
Liu Depu Appo July
ary 39,60 38,85 36,60
Hong ty intme Male 57 19,20 0 0 0 3,000
9,202 0 0 0
lei GM nt 17
4
Septe Febru
Depu
Guan In mber ary
ty Male 36 0 0 0 0 0 0 0
Fei office 22,20 9,202
GM
21 4
Secre
Janua Febru
tary
Jiang In Fema ry ary 30,00 30,00 30,00
to the 51 0 0 0 0
Peng office le 16,20 9,202 0 0 0
board
15 4
of
48
2021 Annual Report
direct
ors
Boar Janua Febru
Zhu d Dimi ry ary 41,10 41,10 41,10
Male 58 0 0 0 0
Jun chair ssion 16,20 10,20 0 0 0
man 15 21
Febru
July
Huan Direc Dimi ary
Male 47 19,20 0 0 0 0 0 0 0
g Yu tor ssion 10,20
17
21
Septe Febru
Wang
Direc Dimi mber ary
Chua Male 49 0 0 0 0 0 0 0
tor ssion 1,201 10,20
n
8 21
Zhan Empl Augu Febru
g oyee Dimi st ary
46 5,300 0 0 0 0 0 0
Xiao super ssion Male 9,201 10,20
dong visor 3 21
339,5 310,2 238,2 96,00
Total -- -- -- -- -- -- 0 0 --
00 00 00 0
During the reporting period, whether there is dismissal of directors and supervisors and decruitment of senior
managers
□ Yes √ No
Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Positions Types Date Reason
Board Left for term February
Zhu Jun The term of office expires
chairman expiration 10,2021
Left for term February
Huang Yu Director The term of office expires
expiration 10,2021
Left for term February
Wang Chuan Director The term of office expires
expiration 10,2021
Zhang Employee Left for term February
The term of office expires
Xiaodong supervisor expiration 10,2021
Employee February The former employee supervisor Left for term
Zhan Lumei Elected
supervisor 10,2021 expiration
September The term of the deputy general manager has expired,
Le Kunjiu Senior adviser Appointment
22,2021 and he is hired as a senior consultant to continue
49
2021 Annual Report
serving in the company and its subsidiaries
(2)Posts holding
Professional background, work experience and main duties in the Company of existing directors, supervisors and
senior management
1. Director
Zhang Jian, female, born in June 1979, master's degree, member of the Communist Party of China. She has
served as an office clerk of the marketing department of Shenzhen Postal Savings and Foreign Exchange Reserves
Bureau, deputy director of the Finance Department of Shenzhen Development and Reform Commission (formerly
Shenzhen Development and Reform Bureau), Senior Staff Member, Principal Staff Member and Deputy Director
of the Industrial Coordination Department of Shenzhen Development and Reform Commission, Deputy Director
of the Economic System Reform Department of Shenzhen Development and Reform Commission, and Party
Member and Deputy General Manager of Shenzhen Kunpeng Equity Investment Management Co., Ltd. She is
currently Party Secretary and Chairman of the Company, and concurrently serves as Party Committee Member,
Deputy General Manager and Secretary of the Board of Directors of Shenzhen SEG Group Co.,Ltd., Director of
Shenzhen SEG Co., Ltd., Vice Chairman of Shenzhen Huakong SEG Co., Ltd., Chairman of Shenzhen Daming
Electronics Co., Ltd., Chairman of Shenzhen SEG High-tech Investment Co., Ltd. and Chairman of SEG (Hong
Kong) Co., Ltd., ; He is currently the Party secretary and Chairman of the Company.
Zhu Meizhu, Male, Born in November 1964, Master degree, Senior engineer, once served successively as chief
Deputy general Manager of Enterprise Management Dept of the Company, Director of R& D Center, Assistant
General Manager and Deputy General Manager, He serves as director and General Manager of the Company, and
Board Chairman of SAPO Photoelectric Co., Ltd.
Ning Maozai, male, born in July 1975, bachelor degree, senior administration engineer, Chinese Communist
Party member; he has served successively as the office clerk of Shenzhen Guomao Automobile Industry Co., Ltd,
the clerk, principal staff member, associate director and director of party-mass office of Shenzhen Property
Development (Group) Corp. and hold a concurrent post of deputy human resource Deputy manager and manager;
At present he holds the position of company director and the party secretary of the Company.
Yin Kefei, male, born in July 1974, master degree, engineer, member of the Communist Party of China. He has
served as Technician and Deputy Director of Customer Service Center of Pipeline Gas Branch of Shenzhen Gas
Group Co., Ltd.; Deputy Director, Director of Civil Service Department and Director of General Office of
Pipeline Gas Customer Service Branch of Shenzhen Gas Group Co., Ltd.; Deputy General Manager of Shenzhen
Gas Group Co., Ltd. Ganzhou Shenran Natural Gas Co., Ltd.; Member of the Party Group and Deputy Director of
the State-owned Assets Supervision and Administration Commission of Dongguan City, Guangdong Province, and
concurrently the Vice Chairman of Dongguan Water Investment Group Co., Ltd.; Deputy Secretary-General of
Dongguan Municipal Government of Guangdong Province, Party Secretary and Director of Dongguan Municipal
Government Liaison Office in Beijing, and concurrently Chairman of the Board of Supervisors of Dongguan
Biotechnology Industry Development Co., Ltd.; Deputy Secretary of the Party Committee, Director and General
Manager of Dongguan Financial Holding Group Co., Ltd., concurrently Director of Dongguan Bank and Director
of Dongguan Asset Management Company; He is currently the Deputy General Manager of Shenzhen Investment
Holdings Co., Ltd. and Director of the Company.
He Fei, male, born in February 1978, master's degree, member of Communist Party of China, Chinese certified
public accountant, accountant. He successively served as accountant of the Planning and Finance Department of
Shenzhen Gas Group Co., Ltd., accountant of the Finance Department of Shenzhen Gas Investment Co., Ltd.,
50
2021 Annual Report
which is affiliated to Shenzhen Gas Group Co., Ltd., and manager of the Finance Department of Hubei Shengjie
Clean Energy Co., Ltd., which is affiliated to Shenzhen Gas Investment Co., Ltd.; Director of General Finance
Department of Shenzhen Convention & Exhibition Center Management Co., Ltd.; Vice Director of Finance
Department (Settlement Center) of Shenzhen Investment Holding Co., Ltd. Currently, he is the company director
and chief financial officer of the company and Supervisor of SAPO Photoelectric Co., Ltd.
Sun Minghui, male, born in September 1981, master degree, accountant, member of the Communist Party of
China. He has served as Staff Member of the Finance Department of Shenzhen Energy Finance Co., Ltd. and the
Financial Management Department of Shenzhen Energy Group Co., Ltd., Finance Management Director of the
Financial Budget Department of Shenzhen Investment Holdings Co., Ltd., Senior Director of the Finance
Department and the Board Office, and Deputy Director of the Finance Department (Settlement Center). He is
currently the Director of Finance Department (Settlement Center) of Shenzhen Investment Holdings Co., Ltd. and
Director of the Company.
He Zuowen, male, born in October 1962, MBA, associate professor in accountancy, charted certified accountant
and certified tax agent in securities and futures industry. At present he acts as a partner of Da Hua Certified Public
Accountants(Special General Partnership) and secretary of Party General Branch of Shenzhen Branch, meanwhile
he holds the position of chairman of Shenzhen Tianye Certified Tax Agents Limited Corporation, consultancy
expert of Internal Control Standard Committee of the Ministry of Treasury, judge of Guangdong Senior
Accountant Evaluation Committee, member of CPC Shenzhen Social Organization Disciplinary Examination
Committee, deputy secretary & secretary of Discipline Inspection Commission of CPC Shenzhen CPA Industry
Board, director of Shenzhen Certified Tax Agents Association and independent director of Shenzhen JPT
OPTO-ELECTRONICS Co., Ltd., Independent director of Shenzhen Yirui Biology Co., Ltd., the Company's
independent directors，Independent director of Shenzhen Special Economic Zone Real Estate (Group) Co., Ltd.,
and Independent Director of the Company.
Cai Yuanqing, born in 1969, Doctor of Laws of Hiroshima University, professor of Law School of Shenzhen
University, director of Company Law Research Center and GSI(Graduate Student Instructor); Meanwhile, he acts
as an arbitrator of Shenzhen Arbitration Commission ,independent director of Shenzhen Rongda Photosensitive
Science & Technology Co., Ltd., Independent director of Shenzhen Oufei Technology Co., Ltd., Independent
director of Ogilvy Medical Supplies Co., ltd. and independent directors of the Company.
Wang Kai, male, born in 1983, Ph.D. of Huazhong University of Science and Technology, Member of the
Communist Party of China, associate professor and researcher of Southern University of Science and Technology
Department of Electronic and Electrical Engineering, and Outstanding Young Man of Guangdong Province. He
has served as a member of the Technical Committee of Beijing Branch of Society for Information Display (SID), a
member of the National Standardization Technical Committee of Flat Panel Display Devices, Deputy Director of
the Key Laboratory of Energy Conversion and Storage Technology of the Ministry of Education, and Deputy
Director of the Key Laboratory of Quantum Dot Advanced Display and Lighting in Guangdong Universities, and
independent director of the Company.
2.Supervisor Ma Yi, male, born in August 1966, bachelor's degree, member of Communist Party of China,
assistant economist. He has successively served as a cadre of the automobile manufacturing and distribution plant
of Hainan automobile transportation corporation, director of the Business Department, assistant to the general
manager and manager of the Transportation Department of Shenzhen Shenjiu International Logistics Co., Ltd.
Guangzhou Branch, operation director of Cosco Logistics Guangzhou Antaida Logistics Co., Ltd., general
manager of Shenzhen Shenjiu International Logistics Co., Ltd. Guangzhou Branch, director of Planning and
Development Department, director assistant, chief of Futian station, deputy secretary of the Party Committee,
director and general manager of Shenzhen highway passenger and freight transportation service center. He is the
51
2021 Annual Report
current chairman of the board of supervisors and secretary of Discipline Inspection Committee of the Company..
Yuan Shuwen, male, born in May 1980, master's degree. He has successively served as chief of Shigu
management station of Hengshan county rural management bureau, financial director of Shenzhen Fengcheng
Iron Wire Products Co., Ltd., project manager of Shenzhen branch of BDO Accounting Firm Co., Ltd., general
ledger accountant of Shenzhen Zhenye (Group) Co., Ltd., director of Financial Budget Department and senior
director of Assessment and Distribution Department of Shenzhen Investment Holding Co., Ltd. Currently, he is
vice director of Assessment and Distribution Department of Shenzhen Investment Holding Co., Ltd. and
supervisor of the Company
Zhan Lumei, female, born in June 1969, college degree, Senior Labor Relations Coordinator, Senior Career
Instructor, member of the Communist Party of China. She has served as the Administrative Personnel Director of
Shenzhen Hualang Garment Co., Ltd., Director and Manager of the Human Resources Department of the
Company. Currently, she is the vice chairman of the Federation of Trade Unions, Director of the Party-mass Work
Department, and Chairman of the Trade Union and the Employee Supervisor of the Company.
3.Senior Executives
Le Kunjiu, male, born in May 1963, bachelor degree economist professional title and CPC member; he has
served successively as the loan officer of the finance department of Zhejiang Ningbo International Trust and
Investment Corporation, deputy director and director of the finance department of CITIC Group Corporation,
Ningbo Branch, manager of the research department of Hainan Fudao Asset Management Co., Ltd, assistant
manager of Shenzhen Leaguer Venture Capital Co., Ltd, vice president & chief financial officer of Shenzhen
Leaguer Digital Television Co., Ltd, chairman & general manager of Shenzhen Oriscape Electronic Co., Ltd, vice
president of Shenzhen International Technology Transfer Center, Tsinghua University, associate director of the
industrial funds preparatory office of Shenzhen Investment Holdings Co., Ltd and Deputy general manager of
Shentou Education; At present he acts as Deputy General Manager of the Company, and Director of SAPO
Photoelectric Co., Ltd. He is the current a senior consultant ofthe Company..
Liu Honglei, male, born in May 1964, bachelor degree and CPC member, Senior engineer, He has served
Technician , Work director, Deputy director of office of First film factory of Ministry of Chemical
Engineering,Director of personnel Education Dept of Education Department of China Lekai Film Group, he has
served as the deputy general manager and general manager of SAPO Photoelectric Co., Ltd from June 2012 to
May 2013 and the head of the party-mass work department and the manager of the business management
department of Shenzhen Textile (Holdings) Co., Ltd; At present he holds the position of deputy general manager
of the company. He is also the secretary and director of the party branch of Shenzhen SAPO Photoelectric
Technology Co., Ltd.
Guan Fei, male, born in December 1985, in-service postgraduate degree, member of the Communist Party of
China, intermediate economist. He has served as the Account Manager of Agricultural Bank of China Shenzhen
Branch, Deputy Director of Sichuan Supervision Bureau of China Banking and Insurance Regulatory Commission,
Senior Investment Manager of Sichuan Industrial Fund Group and Head of Strategic Investment Department
(presiding), First General Manager of Sichuan Innovation and Development Investment Management Co., Ltd.,
and Deputy General Manager of Shenzhen Infrastructure Investment Fund Management Co., Ltd. He is currently
the Deputy General Manager of the Company.
Jiang Peng, Female, born in October 1970, Bachelor Degree, member of communist party, She has served as a
Clerk and Deputy Section Chief of the office of Shandong Aquatic Enterprise Group Corporation, Section Chief
of the Office of the Board of Directors of Shandong Zhonglu Ocean Fishery Co., Ltd., Deputy Director and
Securities Affairs Representative. served as officer of the Secretary Office of Shandong Fishery Group Co.,Ltd.,
Deputy Director of the Secretary office and Securities affairs Representative of Shandong Zhonglu Oceanic
52
2021 Annual Report
Fisheries Co., Ltd., Securities Representative of Huafu Holding Co., Ltd., Securities affairs representative and
Officer of the Secretariat of the Board of the Company, now serves as the secretary of the Board of the Company
Office taking in shareholder companies
√Applicable □Not applicable
Titles Does he /she
Names of the engaged in receive
Sharing date Expiry date of
persons in Names of the shareholders the remuneration or
of office term office term
office shareholder allowance from
s the shareholder
Deputy January
Yin Kefei Shenzhen Investment Holdings Co., Ltd. Yes
GM 11,2021
Director of
Financial November
Sun Minghui Shenzhen Investment Holdings Co., Ltd. Yes
Dept( Clear 11,2020
ing centre）
Deputy
Director of
discipline September
Yuan Shuwen Shenzhen Investment Holdings Co., Ltd. Yes
Inspection 18,2017
&
Supervision
Offices taken in other organizations
√Applicable □Not applicable
Does he/she
Titles
receive
Name of the engaged in
Starting date Expiry date of remuneration or
persons in Name of other organizations the other
of office term office term allowance from
office organizatio
other
ns
organization
Shenzhen Convention and Exhibition
Yin Kefei Director April 23,2021 No
Center Management Co., Ltd
Shenzhen Environmental Technology
Yin Kefei Director April 23,2021 No
Group Co., Ltd.
Yin kefei Shenzhen Wuzhou Guest House Director June 11,2021 No
Director,
August
Yin Kefei Shenzhen Nanyou（Group）Co., Ltd. Vice No
16,2021
president
China Nanshan Development (Group) October
Sun Minghui Supervisor No
Co., Ltd. 17,2017
Sun Minghui Shenzhen Highway Passenger & Cargo Supervisor June 16,2017 No
53
2021 Annual Report
Transportation Service Center Co., Ltd.
Sun Minghui CASTD Supervisor June 27,2017 No
ULTRARICH INTERNATIONAL November
Sun Minghui Director No
LIMITED 11,2020
Shenzhen Special Economic Zone Real November
Sun Minghui Director No
Estate 11,2020
November
Sun Minghui Southern Asset Management Co., Ltd. Supervisor April 28,2021 No
11,2020
Hubei Shentoukong Investment November
Sun Minghui Director No
Development Co., Ltd 11,2020
Shenzhen Shengang Technology
October
Sun Minghui Innovation Cooperation Zone Director No
18,2021
Development Co., Ltd.
September
Yuan Shuwen Shenzhen Textile(Holdings) Co., Ltd. Supervisor No
27,2019
Shenzhen International Tendering Co., October
Yuan Shuwen Supervisor June 10,2020 No
Ltd. 22,2017
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
(3) 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 In the report period, The remuneration of directors and senior management paid
by the company is determined by “Director Compensation Management System” and “Executive Compensation
Management and Evaluation System ” , the remuneration of independent directors is determined as per the
resolution of shareholders’ meeting, and the remuneration of supervisors paid by the company is determined by
their position held in the company.
Remuneration to directors, supervisors and senior executives in the reporting period
In RMB10,000
Total Whether to get
remuneration paid in the
Name Positions Sex Age Office status
received from company
the Company related party
Board
Zhang Jian Female 42 In office 60.15 No
Chairman
Director,
Zhu Meizhu General Male 57 In Office 140.29 No
Manager
54
2021 Annual Report
Director ,
Secretary of the
Ning Maozai Male 46 In Office 127.16 No
Party
committee
Yin Kefei Director Male 47 In office 0 Yes
He Fei Director ,CFO Male 44 In Office 111.15 No
Sun Minghui Director Male 40 In Office 0 Yes
Independent
He Zuowen Male 59 In Office 12 No
Director
Independent
Cai Yuanqing Male 52 In Office 12 No
Director
Independent
Wang Kai Male 38 In office 12 No
Director
Chairman of
the supervisory
committee,
Ma Yi Secretary of the Male 55 In Office 100.62 No
Commission
for Discipline
Inspection
Shareholders'
Yuan Shuwen Male 41 In Office 0 Yes
Supervisor
Employee
Zhan Lumei Female 52 In office 57.69 No
supervisor
Le Kunjiu Senior adviser Male 58 In Office 126.51 No
Liu Honglei Deputy GM Male 57 In Office 169.43 No
Guan Fei Deputy GM Male 36 In Office 19.52 No
Secretary to the
Jiang Peng board of Female 51 In office 102.81 No
directors
Board
Zhu Jun Male 58 Dimission 61.2 No
chairman
Zhang Employee
Male 46 Dimission 2.75 Yes
Xiaodong supervisor
Huang Yu Director Male 47 Dimission 0 Yes
Wang Chuan Director Male 49 Dimission 0 Yes
Total -- -- -- -- 1,115.28 --
55
2021 Annual Report
VI. Performance of directors' duties during the reporting period
(1) Information of the board meetings during the reporting period
Session Convening date Disclosure date Meeting resolution
http://www.cninfo.com.c
The 35th meeting of the
January 15,2021 January 16,2021 (Announcement
seventh Board of Directors
No.:2021-01)
http://www.cninfo.com.c
The 36th meeting of the
January 25,2021 January 26,2021 (Announcement
seventh Board of Directors
No.:2021-07)
http://www.cninfo.com.c
The first meeting of the
February 10,2021 February 10,2021 (Announcement
Eighth Board of Directors
No.:2021-151)
http://www.cninfo.com.c
The Second meeting of the
March 10,2021 March 12,2021 (Announcement
Eighth Board of directors
No.:2021-17)
http://www.cninfo.com.c
The Third meeting of the
April 26,2021 April 28,2021 (Announcement
Eighth Board of directors
No.:2021-33)
http://www.cninfo.com.c
The Fourth meeting of the
May 24,2021 May 25,2021 (Announcement
Eighth Board of directors
No.:2021-37)
http://www.cninfo.com.c
The Fifth meeting of the
July 13,2021 July 14,2021 (Announcement
Eighth Board of directors
No.:2021-44)
http://www.cninfo.com.c
The sixth meeting of the
August 26,2021 August 28,2021 (Announcement
Eighth Board of directors
No.:2021-49)
http://www.cninfo.com.c
The 7th meeting of the Eighth
September 22,2021 September 24,2021 (Announcement
Board of directors
No.:2021-55)
http://www.cninfo.com.c
The 8th meeting of the Eighth
October 28,2021 October 30,2021 (Announcement
Board of directors
No.:2021-58)
http://www.cninfo.com.c
The 9th meeting of the Eighth
December 31,2021 December 31,2021 (Announcement
Board of directors
No.:2021-61)
56
2021 Annual Report
(2) Attendance of directors at the board meetings and the general meeting of shareholders
Attendance of directors at the board meetings and the general meeting of shareholders
Number of Number of
Whether to
board Number of board Number of
Number of attend the General
meetings board meetings board
Name of board board meetings of
attended meetings attended by meetings
director meetings meeting in shareholders
during the attended in means of attended by
absent from person twice attended
reporting person communicati proxy
in a row
period on
Zhang Jian 9 9 0 0 0 No 4
Zhu Meizhu 11 11 0 0 0 No 4
Ning Maozai 11 11 0 0 0 No 4
Yin Kefei 9 9 0 0 0 No 1
He Fei 11 11 0 0 0 No 4
Sun Minghui 9 9 0 0 0 No 1
He Zhuowen 11 3 8 0 0 No 4
Cai Yunqing 11 3 8 0 0 No 4
Wang Kai 11 3 8 0 0 No 3
Zhu Jun 2 2 0 0 0 No 0
Wang Chuan 2 2 0 0 0 No 0
Huang Yu 2 2 0 0 0 No 0
Explanation of failure to attend the board meeting in person twice in a row
None
(3) Directors' objections to related matters of the Company
Whether the director raises any objection to the relevant matters of the Company
□ Yes √ No
During the reporting period, the directors did not raise any objection to the relevant matters of the Company.
(4) Other descriptions of directors' performance of duties
Whether the directors' suggestions on the Company have been adopted
√Yes □ No
The director's statement on whether the relevant suggestions of the Company have been adopted or not
During the reporting period, all directors of the Company worked diligently and conscientiously in strict
accordance with the relevant regulations of China Securities Regulatory Commission and Shenzhen Stock
Exchange, the Articles of Association, the Rules of Procedure of the Board of Directors and other systems of the
Company, paid close attention to the Company's standardized operation and business situation, put forward
57
2021 Annual Report
relevant opinions on the Company's major governance and business decisions according to the actual situation of
the Company, reached a consensus after full communication and discussion, and resolutely supervised and
promoted the implementation of the resolutions of the Board of Directors, so as to ensure scientific, timely and
efficient decision-making, and protect the legitimate rights and interests of the Company and all shareholders.
VII. Situation of special committees under the Board of Directors during the reporting period
Put forward Other
Number of Details of
Committee Member Convening Meeting important information
meetings objections (if
name information date content opinions and of duty
convened any)
suggestions performance
The Audit
Committee
It deliberated emphasized
the 2020 the need to
Audit Work strengthen
Plan for the tracking
Annual and
Report, 2020 inspection of
Main audit
Financial rectification,
Indicators enhance the
Express of timeliness of
the Group, internal
January
2020 audit, and
12,2021
He Internal reduce the
Zhuowen, Audit Work recurrence of
Audit
Cai 6 Summary problems
Committee
Yuanqing, and 2021 found in
He Fei Internal audit, and
Audit Work agreed to the
Plan and 2020
2020 Audit financial
Plan of statement
Shenzhen indicator
Textile. express and
related work
plan.
The The Audit
accountant of Committee
February Grant worked in
5,2021 Thornton strict
reported to accordance
the Audit with the
58
2021 Annual Report
Committee Company
the progress Law, the
of the audit regulatory
of the 2020 rules of
annual report China
and the Securities
problems Regulatory
concerned in Commission
the audit and the
process, and Articles of
the Audit Association
Department and the Rules
reported the of Procedure
2020 work of the Board
summary and of Directors
the 2021 in a diligent
internal audit and dutiful
work plan of manner, and
the unanimously
Company. passed
The Audit relevant
Committee proposals
put forward after full
suggestions communicati
and on and
requirements discussion.
for the
follow-up
audit work.
It deliberated The Audit
the 2020 Committee
Financial worked in
Final strict
Accounts accordance
Report, the with the
2020 Profit Company
March
Distribution Law, the
5,2021
Plan, the regulatory
Proposal on rules of
Accounting China
Policy Securities
Change, the Regulatory
Special Commission
Report on the and the
59
2021 Annual Report
Deposit and Articles of
Use of Association
Raised Funds and the Rules
in 2020, and of Procedure
the Proposal of the Board
on the of Directors
Permanent in a diligent
Replenishme and dutiful
nt of manner, and
Working unanimously
Capital with passed
Surplus relevant
Raised proposals
Funds. after full
communicati
on and
discussion.
The Audit
Committee
recognized
the internal
It listened to
audit work of
the Internal
the Risk
Audit Work
Control
Summary for
Audit
the First
Department
Quarter and
in the first
the Internal
quarter of
Audit Work
2021, and
Plan for the
requested the
April Second
Risk Control
26,2021 Quarter of
Audit
2021
Department
reported by
to continue
the Audit
to carry out
Department,
work
and put
according to
forward
the
relevant
requirements
requirements
of the annual
.
internal audit
work plan for
the second
quarter of
60
2021 Annual Report
2021.
The Audit
Committee
recognized
It listened to the internal
the Special audit work of
Inspection the Risk
Report on Control
Standardized Audit
Operation of Department
Listed in the second
Companies quarter of
in the First 2021, and
Half of 2021, requested the
the Summary Risk Control
of Internal Audit
Audit Work Department
in the Second to continue
Quarter and to carry out
the Internal work
Audit Work according to
Plan in the the
August
Third requirements No No
13,2021
Quarter of of the annual
2021, which internal audit
were work plan for
reported by the third
the Audit quarter of
Department, 2021. In
deliberated 3 accordance
proposals with the
including the requirements
Proposal on of enterprise
Hiring Audit internal
Institutions control
in 2021 and standard
put forward system and
relevant relevant
requirements regulations,
for the audit the Company
work. has
maintained
effective
internal
61
2021 Annual Report
control of
financial
report and
non-financial
report in all
major
aspects. It is
unanimously
agreed to
pass the
related
proposal.
The Audit
Committee
recognized
the internal
The Audit
audit work of
Committee
the Risk
listened to
Control
the Summary
Audit
of Audit
Department
Work in the
in the third
Third
quarter of
Quarter and
2021, and
the Internal
requested the
Audit Work
Risk Control
Plan in the
Audit
Fourth
October Department
Quarter of
28,2021 to continue
2021
to carry out
reported by
work
the Risk
according to
Control
the
Audit
requirements
Department,
of the annual
and put
internal audit
forward
work plan for
relevant
the fourth
requirements
quarter of
for internal
2021. In
audit work.
accordance
with the
requirements
of enterprise
62
2021 Annual Report
internal
control
standard
system and
relevant
regulations,
the Company
has
maintained
effective
internal
control of
financial
report and
non-financial
report in all
major
aspects.
The
Remuneratio
n and
Appraisal
Committee
believed that
since the
repurchase
and
It deliberated
cancellation
matters
of restricted
related to
Remuneratio He stocks were
repurchase
n and Zhuowen, January in
4 and No No
Appraisal Wnag Kai, 8,2021 compliance
cancellation
Committee He Fei with the
of some
Administrati
restricted
ve Measures
stocks.
for Equity
Incentives of
Listed
Companies,
Memorandu
m No.3 of
Information
Disclosure
on Main
63
2021 Annual Report
Board-Equity
Incentives
and
Employee
Stock
Ownership
Plan and the
Company's
2017
Restricted
Stock
Incentive
Plan (Draft)
and other
relevant
regulations,
and the
repurchase
and
cancellation
of the
Company
will not
affect the
Company's
continuing
operations or
harm the
interests of
the Company
and all
shareholders,
it is
unanimously
agreed to
pass the
proposal.
It deliberated The
matters Remuneratio
related to n and
March
repurchase Appraisal
8,2021
and Committee
cancellation believed that
of some since this
64
2021 Annual Report
restricted repurchase
stocks. and
cancellation
were in
compliance
with the
Administrati
ve Measures
for Equity
Incentives of
Listed
Companies,
Guidelines
No.9 for
Business
Management
of Listed
Companies
of Shenzhen
Stock
Exchange-Eq
uity
Incentives
and the
Company's
2017
Restricted
Stock
Incentive
Plan and
other
relevant
regulations,
and it will
not affect the
Company's
continuing
operation or
harm the
interests of
the Company
and all
shareholders,
it is
65
2021 Annual Report
unanimously
agreed to
repurchase
and cancel
such
restricted
stocks.
The
Remuneratio
n and
Appraisal
Committee
believed that
the
formulation
of the 2020
Business
Performance
It deliberated
Assessment
the Proposal
and
on
Remuneratio
Formulating
n
the 2020
Management
Annual
Plan for
Business
Senior
August Performance
Managers
12,2021 Assessment
conformed to
and
the relevant
Remuneratio
provisions of
n
the
Management
Governance
Plan for
Guidelines of
Senior
Listed
Managers.
Companies,
the Articles
of
Association
of the
Company
and the
Working
Regulations
of the
Remuneratio
66
2021 Annual Report
n and
Appraisal
Committee
of the Board
of Directors;
and it is
agreed to
submit the
2020
Business
Performance
Assessment
and
Remuneratio
n
Management
Plan for
Senior
Managers to
the Board of
Directors of
the Company
for
deliberation.
The
Remuneratio
n and
Appraisal
Committee
worked in
It deliberated strict
the Proposal accordance
on with the
October Remuneratio Company
No No
9,2021 n Assessment Law, the
of Senior regulatory
Managers in rules of
2020. China
Securities
Regulatory
Commission
and the
Articles of
Association
67
2021 Annual Report
and the Rules
of Procedure
of the Board
of Directors
in a diligent
and dutiful
manner, put
forward
relevant
opinions
according to
the actual
situation of
the
Company,
and
unanimously
passed the
proposal
after full
communicati
on and
discussion.
The
Nomination
It deliberated Committee
the Proposal members
on worked in
Nominating strict
Candidates accordance
for Deputy with the
Cai General Articles of
Yuanqing, Manager of Association
Nomination August
He Fei, He 2 the Company of the No No
Committee 26,2021
Zhuowen, and the Company
Wang Kai Proposal on and the
Nominating Regulations
Candidates on the Work
for General of the
Manager of Nomination
the Committee
Company. of the Board
of Directors,
reviewed the
68
2021 Annual Report
qualifications
of candidates
and
unanimously
passed
relevant
proposals.
The
Nomination
Committee
members
worked in
strict
accordance
with the
Articles of
Association
of the
Company
It deliberated and the
the Regulations
February
nomination on the Work
10,2021
of senior of the
managers. Nomination
Committee
of the Board
of Directors,
deliberated
the
qualifications
of candidates
and
unanimously
passed
relevant
proposals.
VIII.The working status of the board of supervisors
The board of supervisors finds out whether the company has risks during the monitoring activities during the repo
rting period
□ Yes √ No
The Supervisory Committee has no objection to the supervision matters during the reporting period.
69
2021 Annual Report
IX. Particulars about employees.
(1)Number of staff, professional structure and educational background
Number of in-service staff of the parent company(person) 56
Number of in-service staff of the main subsidiaries(person) 1,575
The total number of the in-service staff(person) 1,631
The total number of staff receiving remuneration in the current
1,631
period(person)
Retired staff with charges paid by the parent company and
0
main subsidiaries (person)
Professional
Category Number of persons（person）
Production 1,158
Sales 29
Technical 231
Financial 33
Administrative 180
Total 1,631
Education
Category Number of persons（person）
Holders of master’s degree or above 41
Graduates of regular university 265
Colleges 157
Mid-school or below 1,168
Total 1,631
(2) Remuneration policies
In 2021, the Company carried out management for employees’ compensation in strict accordance with the state’s
relevant laws and regulations and guaranteed the fairness and reasonability of the compensation, which offered
relevant rewards and incentives to the employees, accelerate them to jointly develop with the Company , and
simultaneously reflected humanistic care of the Company.
(3)Training plan
Combining with the Company's development strategy, it continued to strengthen the Company's talent training
system to help employees and the company develop together. In 2021, it improved the systematic talent training
system to provide solid support for the Company's strategic development. First, it organized the special training of
70
2021 Annual Report
"Butterfly Change Breakthrough Win in Execution", comprehensively publicized and implemented the execution
culture, and enhanced the execution and combat effectiveness of all employees. Second, it organized a case
sharing activity of "Success in Details Win in Implementation", which enhanced the interaction among
employees and cultivated the habit of active thinking and active learning among employees. Third, it organized a
series activities of "Get to Know You Face-to-Face", in which the Chairman of the Company communicated with
the core backbones of affiliated enterprises, so as to acquire a deep understanding of the actual situation and
existing problems of enterprises and cadres, and better promote the sustained, healthy and high-quality
development of the Group. Fourth, it organized the management of training points, established a learning
organization, mobilized the enthusiasm of employees in learning and sharing, and promoted employees' active
learning. In terms of training, the Company helped employees to open up new horizons of learning in multiple
dimensions, and promote their practical work by applying theories.
(4)Outsourcing situation
□ Applicable √ No Applicable
X. Specification of profit distribution and capitalizing of common reserves
Formulation, implementation or adjustment of the profit distribution policy, especially the cash dividend policy
during the reporting period
√ Applicable □ Not applicable
On April 7, 2021, the Company held the 2020 annual general meeting of shareholders to deliberate and pass
the 2020 profit distribution plan. The 2020 profit distribution plan of the Company is as follows: based on the
profit available for distribution in the consolidated statement, with the total share capital of 507,772,279 shares as
the base as of December 31, 2020, a cash dividend of RMB 0.30 (including tax) will be distributed to all
shareholders for every 10 shares, with a total cash dividend of RMB 15,233,168.37 (including tax), the remaining
undistributed profits will be carried forward to the next year; No bonus shares will be given, and no capital reserve
will be used to increase capital. If the total share capital of the Company changes before the implementation of the
distribution plan, the total share capital of date of record will be taken as the base when the distribution plan is
implemented in the future, and the specific amount will be subject to the actual distribution. The Company's
shares held by the Company are not included in profit distribution.
During the period from the disclosure of the distribution plan to its implementation, the total share capital of the
Company was reduced from 507,772,279 shares to 506,521,849 shares due to the completion of cancellation
procedure of restricted stock repurchase. According to the above profit distribution plan, the Company's 2020
profit distribution plan is adjusted as follows: based on the Company's existing total share capital of 506,521,849,
a cash dividend of RMB 0.30 (including tax) will be distributed to all shareholders for every 10 shares.
Special description of cash dividend policy
Whether it meets the requirements of the Articles of
Association or the resolution of the general meeting of Yes
shareholders:
Whether the dividend standard and proportion are explicit and
Yes
clear:
Whether the relevant decision-making procedures and
Yes
mechanisms are complete:
71
2021 Annual Report
Whether the independent directors have performed their duties
Yes
and played their due role:
Whether the minority shareholders have the opportunity to
fully express their opinions and demands, and whether their Yes
legitimate rights and interests have been fully protected:
Whether the cash dividend policy is adjusted or changed, and
whether the conditions and procedures are compliant and Yes
transparent:
During the reporting period, the Company made a profit and the profit available to shareholders of the parent
company was positive, but no cash dividend distribution plan was put forward.
□ Applicable √ Not applicable
Profit distribution and capitalization of capital reserve during the reporting period
√ Applicable □ Not applicable
Bonus shares for every ten shares(Shares) 0
Cash dividend for every ten shares
0.50
(Yuan)(Tax-included)
A total number of shares as the distribution
506,521,849
basis(shares)
Cash dividend amount (yuan, including tax 0.50
Other means (such as repurchase of shares) cash
0.00
dividend amount (yuan)
Total cash dividend (yuan, including tax) 25,326,092.45
Distributable profit (yuan) 130,746,251.74
Proportion of cash dividend in the distributable
100%
profit
Cash dividend distribution policy
When the company's development stage is in the growth period and there are major capital expenditure arrangements, when the
profit distribution is carried out, the proportion of cash dividends in this profit distribution should be at least 20%.
Detailed explanation of the profit distribution or capital reserve transfer plan
Based on the distributable profits in the consolidated statement, with the total share capital of 506,521,849 shares as of December
31, 2021 as the base, a cash dividend of RMB 0.5 (including tax) was distributed to every 10 shares of all shareholders, with a
total cash dividend of RMB 25,326,092.45 (including tax).
XI. Implementation Situation of Stock Incentive Plan of the Company, Employee Stock Ownership Plan or
Other Employee Incentive Measures
√ Applicable □ Not applicable
72
2021 Annual Report
(1) Equity incentive
On November 27, 2017, the Proposal on the Company's Implementation Measures of Evaluation for the 2017
Restricted Stock Incentive Plan (Draft) and summary and the Proposal on the Company's Implementation
Measures of Evaluation for the 2017 Restricted Stock Incentive Plan was examined and approved in the 7th board
meeting of the company’s 7th session board of directors, and related proposals agreed to fulfill the relevant
procedures and related proposals agreed to fulfill the relevant procedures. Please refer to Announcement
No.:2017-57, 2017-58, 2017-62 on www.cninfo.com.cn. The progress during the reporting period is now
explained as follows:
1. Regarding the repurchase and cancellation of some restricted stocks
On January 15, 2021, the company held the 35th meeting of the 7th Board of Directors and the 25th meeting
of the 7th Board of Supervisors. The board of directors deliberated and approved the "Proposal on Repurchase and
Cancellation of Some Restricted Stocks", which intends to repurchase and cancel 7,950 restricted stocks held by
an original incentive object who resigned due to personal reasons, at a repurchase price of RMB 5.73 per share; It
is proposed to repurchase and cancel the 6,000 restricted shares held by a retired incentive object at a price of 6.23
yuan per share.
On February 2, 2021, the company held the first extraordinary general meeting of shareholders in 2021 to
consider and pass the "Proposal on Repurchase and Cancellation of Certain Restricted Stocks", agreeing to the
company's total holdings of 1 original incentive object who resigned due to personal reasons 7,950 restricted
stocks were repurchased and cancelled at a repurchase price of 5.73 yuan/share; agreed that the company would
repurchase and cancel 6,000 restricted stocks held by a retired incentive object at a repurchase price of 6.14
yuan/share, in total 13,950 restricted stocks were repurchased and cancelled
On May 13, 2021, the company completed the repurchase and cancellation procedures of the above-mentioned
restricted stocks at the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd
2. Regarding the repurchase and cancellation of some restricted stocks and the repurchase and cancellation of
the third phase of restricted stocks
On March 10, 2021, the company held the second meeting of the eighth board of directors and the second
meeting of the eighth board of supervisors. The "Proposal on Repurchase and Cancellation of Certain Restricted
Stocks" was reviewed and passed, and the company agreed to provide incentives to 102 A total of 1,236,480
restricted stocks held in the third period that did not meet the conditions for lifting the restrictions were
repurchased and cancelled. The repurchase price was calculated as the grant price of RMB 6.26 per share plus the
interest on bank deposits during the same period.
On April 7, 2021, the company held the 2020 Annual General Meeting of Shareholders to review and approve
the Proposal on Repurchase and Cancellation of Some Restricted Stocks, and agreed that the company would
repurchase and cancel 1,236,480 restricted stocks held by 102 incentive objects in the third issue that did not meet
the conditions for lifting the restrictions on sales, and the repurchase price was RMB 6.26 per share.
On May 13, 2021, the company completed the repurchase and cancellation procedures of the
above-mentioned restricted stocks at the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd.
Equity incentives obtained by directors and senior managers of the Company
□ Applicable √ Not applicable
Evaluation mechanism and incentives of senior managers
None
73
2021 Annual Report
(2) Implementation of ESOP
√ Applicable □ Not applicable
All effective ESOPs during the reporting period
Proportion of total Funding sources
Scope of Quantity of Total number of Change
share capital of for plan
employees employees shares held information
listed companies implementation
Directors,
supervisors, senior
The Company
managers and
employees' legal
other core
remuneration,
technical/business/
self-raised funds
management 127 1403600 No 0.28%
and other legal
backbones of the
ways permitted by
Company
laws and
(including
regulations.
subsidiaries, the
same below).
Shareholding of directors, supervisors and senior managers in the ESOP during the reporting period
Number of shares held Number of shares held Proportion of total
Name Position at the beginning of the at the end of the share capital of listed
reporting period reporting period companies
Zhang Jian Chairman of the Board 0 114,206 0.02%
Director, General
Zhu Meizhu 0 114,206 0.02%
Manager
Director, Secretary of
Party Committee and
Ning Maozai Secretary of Discipline 0 28,551 0.01%
Inspection
Commission
Le Kunjiu Deputy GM 0 57,103 0.01%
Liu Honglei Deputy GM 0 57,103 0.01%
He Fei Director, CFO 0 57,103 0.01%
Jiang Peng Secretary of the Board 0 57,103 0.01%
Zhan Lumei Employee supervisor 0 17,131 0.00%
Changes in asset management institutions during the reporting period
□ Applicable √Not applicable
Changes in equity caused by holders' disposal of shares during the reporting period
√ Applicable □ Not applicable
During the reporting period, Huang Weiqi and He Guangdong, the original holders of the Company's first ESOP,
74
2021 Annual Report
resigned for personal reasons. Upon confirmation by the management committee of the Company's first ESOP,
they transferred their 50,000 shares in ESOP to Huo Zhifeng. After the transfer, Huo Zhifeng's share in the first
ESOP of the Company was changed from 150,000 to 250,000 shares.
Exercise of shareholders' rights during the reporting period
During the reporting period, the Company's ESOP was not involved in the voting of the Company's general
meeting of shareholders and exercise other shareholders' rights.
Other relevant information and description of ESOP during the reporting period
□ Applicable √Not applicable
The membership of the ESOP Management Committee has changed.
□ Applicable √Not applicable
Financial impact of ESOP on listed companies in the reporting period and related accounting treatment
□ Applicable √Not applicable
Termination of ESOP during the reporting period
□ Applicable √Not applicable
Other note
None
(3) Other employee incentives
□ Applicable √Not applicable
XII. Construction and implementation of internal control system during the reporting period
(1) Construction and implementation of internal control
During the reporting period, the Company timely updated and improved the internal control system according to
the Basic Standards for Enterprise Internal Control and its supporting guidelines, and established a scientific,
concise, applicable and effective internal control system. The Audit Committee and the Risk Control Audit
Department jointly formed the Company's risk internal control management organization system to supervise and
evaluate the Company's internal control management. Through the operation, analysis and evaluation of the
Company's internal control system, the risks in operation and management are effectively prevented, and the
realization of internal control objectives is promoted.
According to the identification of major internal control defects in the Company's financial report, there were no
major internal control defects in the financial report on the base date of the internal control evaluation report. In
accordance with the requirements of enterprise internal control standard system and relevant regulations, the
Company has maintained effective internal control of financial reports in all major aspects.
According to the identification of major defects in the internal control of the Company's non-financial reports, the
Company found no major defects in the internal control of non-financial reports on the base date of the internal
control evaluation report.
(2)Details of major internal control defects found during the reporting period
□ Yes √ No
75
2021 Annual Report
XIII. Management and control of the Company's subsidiaries during the reporting period
Problems Subsequent
Integration Measures taken Solution
Company name Integration plan encountered in planned
progress for solution progress
integration solution
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
XIV.Internal control self-evaluation report or internal control audit report
(1)Self-evaluation report on internal control
Disclosure date of appraisal report on internal control March 17,2022
Juchao Website:（http://www.cninfo.com.cn）,
Disclosure index of appraisal report on internal control
Self-evaluation report of internal control in 2021
The ratio of the total assets of units included in the
scope of evaluation accounting for the total assets on the 100.00%
company's consolidated financial statements
The ratio of the operating income of units included in
the scope of evaluation accounting for the operating
100.00%
income on the company's consolidated financial
statements
Standards of Defects Evaluation
Category Financial Report Non-financial Report
In the following circumstances, the company
was identified as existing non-financial
–reporting related significant defects of internal
The defects related to financial reports were
controlling defects:
divided into general defects, important defects
The business activities of the company seriously
and significant defects according to their
violated national laws and regulations; (2) The
severity. Significant defects referred to one or
decision-making process of "Three-Importance&
multiple combinations of controlling defects,
One-Large" were unscientific, leading to major
which may lead to serious deviation from the
decision errors, and causing major property loses
controlling objectives. Important defects referred
to the company; (3) Massive loss of key posts or
Qualitative standard to one or multiple combinations of controlling
technology talents; (4) The controlling system
defects, and their severity and economic
involving important business fields of the
consequences were below significant defects,
company failed; (5) It Caused serious negative
but they could still lead to serious deviation from
effects on business of the company, and the
the controlling objectives. General defects
effects couldn’t be eliminated; (6) The
referred to other internal controlling defects
evaluation results of internal control were
which couldn't constitute significant defects or
significant defects, and couldn’t get effective
important defects.
rectification. Important defects referred to one or
multiple combinations of controlling defects,
and their severity and economic consequences
76
2021 Annual Report
were below significant defects, but they could
still lead to serious deviation from the
controlling objectives. General defects referred
to other internal controlling defects which
couldn't constitute significant defects or
important defects.
Misstatement amount of financial statement fell
into the following intervals: significant defects:
Misstatement amount ≥ 1.5% of total revenue;
Misstatement amount ≥ 10% of gross profit;
Misstatement amount ≥ 1% of total asset;
Misstatement amount ≥ 5% of net asset.
significant defects: 0.5% of Total revenue
≤Misstatement amount ＜ 1.5% of total
revenue; 5% of gross profit ≤Misstatement
Quantitative criteria amount ＜ 10% of gross profit; 0.5% of Total Not applicable
asset ≤Misstatement amount ＜ 1% of total
revenue; 3% of Net assets ≤Misstatement
amount ＜ 5% of net assets. General
defects:0% of total revenue ＜Misstatement
amount＜0.5% of Total revenue; 2% of gross
profit ＜Misstatement amount＜5% of total
profit; 0% of total assets ＜Misstatement
amount＜0.5 of total assets; 0% of net assets ＜
Misstatement amount＜3% of net assets.
Number of major defects in financial reporting（a） 0
Number of major defects in non financial reporting (a) 0
Number of important defects in financial reporting（a） 0
Number of important defects in non financial reporting（a） 0
(2) Internal Control audit report
√ Applicable □Not applicable
Review opinions in the internal control audit report
o all shareholders of Shenzhen Textile (Holdings) Co., Ltd.：
According to the relevant requirements of the “Audit Guideline of Enterprise Internal Control” and the Chinese CPA criteria, the
company has audited the effectiveness of internal control of the financial statement of Shenzhen Textile (Holdings) Co., Ltd.
(Shenzhen Textile) at the date of December 31, 2021.
1. The responsibility of enterprise for the internal control. According to the provisions of “Fundamental Norms for Enterprise
Internal Control”, “Operation Guideline of Enterprise Internal Control” and “Evaluation Guideline of Enterprise Internal
Control”, the company has established, perfected and effectively implemented the internal control, and made an evaluation for its
effectiveness, which are the responsibilities of the Board of Directors of Shenzhen Textile.
77
2021 Annual Report
2. The responsibility of CPA. The company shall be responsible for the expression of audit opinions on the effectiveness of
internal control in the financial statement and the disclosure of serious deficiency of internal control except for the financial
statement on the basis of the implementation of audit.
3. The inherent limitation of internal control. There is the possibility of unpreventable errors. In addition, due to the change of
situation, the inappropriate internal control is maybe shown, or the control policy and the abidance of procedure can be reduced.
Based on the audit results of internal control, the future internal control is expected to have a certain risk.
4. The audit opinions of internal control in the financial statement. The company believes that Shenzhen Textile has maintained
the effective internal control of the financial statement in all the major aspects according to “Fundamental Norms for Enterprise
Internal Control” and the relevant provisions on December 31, 2021
Grant Thornton International Ltd.(Special General Partnership)
Chinese C.P.A. Chen Zhifang
Chinese C.P.A. Liu Duoqi
March 15, 2022
Disclosure date of audit report
Disclosure
of internal control (full-text)
Index of audit report of
March 17,2022
internal control (full-text)
Juchao Website: （http://www.cninfo.com.cn）;Audit report of internal control of the
Internal audit report’s opinion
Company
Type of audit report on internal
Unqualified auditor’s report
control
Whether there is significant
No
defection 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
XV. Rectification of self-examination problems in special governance actions of listed companies
According to the deployment of China Securities Regulatory Commission, in 2021, the Company organized the
self-inspection of special actions of listed companies' governance. During the self-inspection of governance, the
following problems were found: 1. The Company's Board of Directors has not changed when due; 2. The number
of independent directors in the Audit Committee of the Company does not exceed half of the total; 3. The
directors, supervisors and senior managers of the Company failed to attend (or attend as a nonvoting delegate) or
entrust others to attend general meeting of shareholders, meetings of board of Directors and Board of Supervisors
as required.
The rectification measures are as follows:
78
2021 Annual Report
1. Through communication with the controlling shareholder Shenzhen Investment Holdings Co., Ltd., it learned
that Shenzhen Investment Holdings received a notice from the superior that in principle, the deliberation of cadre
and personnel matters was suspended during the change of Shenzhen Municipal Party Committee. As the
Chairman of the Company is appointed and managed by the State-owned Assets Supervision and Administration
Commission of Shenzhen Municipal People's Government, and the re-election of Shenzhen Municipal Party
Committee has not yet been completed, the postponement of the re-election of the Seventh Board of Directors and
Board of Supervisors has been reported to Shenzhen Stock Exchange for records. On November 25, 2020, the
Company started the change of office immediately after receiving the recommendation letter from the controlling
shareholder, and on February 10, 2021, it completed the change of directors and supervisors;
2. The Audit Committee of the Seventh Board of Directors of the Company consists of 4 members, including 2
independent directors. In the past, the Company routinely added the Chief Financial Officer and the Secretary of
the Commission for Discipline Inspection to the Audit Committee of the Board of Directors, resulting in less than
half of the independent directors in the Audit Committee. The Audit Committee of the Eighth Board of Directors
of the Company consists of 3 members, including 2 independent directors, which have been rectified;
3. When the Company's directors and supervisors are unable to attend the general meeting of shareholders, the
meetings of the Board of Directors and the Board of Supervisors of the Company, they have all fulfilled the
corresponding leave procedures, and there is no absence from the general meeting of shareholders without reason.
79
2021 Annual Report
V. Environmental & Social Responsibility
I. Significant environmental issues
Whether the Company or any of its subsidiaries is identified as a key polluter by the environment authorities
√ Yes □ No
Main
Emission Implemen
Company pollutant Emission Verified
Emission port ted Total Excessive
or and Emission concentra total
port distributi pollutant emission emission
subsidiary specific way tion emission(
number on emission condition
name pollutant (mg/Nm3) Tons)
condition standards
name
Shenzhen Open
Beauty channel Northwes
Effluents ＜
Century discharge 1 t side of 60mg/L ＜2.43t/a 2.43t/a No
：COD 60mg/L
Garment after plant area
Co., Ltd. treatment
Prevention and control of pollution facilities construction and operation
The Beauty Century Company wastewater treatment facilities adopt the treatment processes of regulation,
hydrolysis acidification, coagulation and air flotation, contact oxidation, coagulation and sedimentation and
filtration. It is with stable treatment process, and good effluent effect of wastewater treatment. The wastewater
from the production process can meet the environmental protection requirements after being treated by wastewater
treatment facilities.
The Company invested RMB 960,000 to build the reuse system of reclaimed water, and now the reuse project of
reclaimed water has been accepted and started operation.
Situation of Construction project environmental impact assessment and other environmental protection
administrative licenses
The Company complied with relevant environmental protection regulations at such three stages as project design,
construction and operation and obtained environmental protection approvals needed at each corresponding stage
including EIA report, EIA approval, environmental protection acceptance decision and emission permit among
others.
Emergency Plan for Emergency Environmental Incidents
According to the actual situation of the company, the preparation of the emergency plan for emergency
environmental incidents was completed, and an emergency environmental emergency plan filing application
Environmental Self-Monitoring Program
According to the environmental management requirements of the pollutant discharge permit, the specific
monitoring scheme is as follows: once every 6h for pH value of wastewater, once per day for chroma, once per
day for suspended solids, once per week for biochemical oxygen demand in five days, once every 6h for chemical
oxygen demand, once per day for total nitrogen, once per day total phosphorus, once per month for sulfide, once
per month for aniline, once per year chlorine dioxide, and twice per year for waste gas at factory boundary (once
every six months).
Administrative penalties for environmental problems during the reporting period
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2021 Annual Report
Impact on the
Company's
Name of company Reasons for production and
Violation situation Penalty result rectification
or subsidiary punishment operation of listed
measures
companies
No No No No No No
Other Environmental Information That Should Be Disclosed
None
Measures and effects taken to reduce its carbon emissions during the reporting period
√Applicable □ Not applicable
The use of reclaimed water can effectively reduce wastewater discharge, and 2,500 tons of tap water have been
saved in the reporting period.
Other Environmental Related Information
None
II. Social responsibilities
1. Protection of shareholders' rights and interests
During the reporting period, the Company abided by laws and regulations, operated in compliance with
regulations, and constantly improved its governance structure and further standardized the Company's operation in
strict accordance with the requirements of the Company Law, the Securities Law and the Governance Guidelines
for Listed Companies and other laws and regulations. It adhered to the procedure system of general meeting of
shareholders, Board of Directors, Board of Supervisors and independent directors as the core, further improved
the corporate governance structure and various management systems, constantly improved the internal control
system in the process of the Company's operation and management, took effective operational risk prevention
measures, earnestly safeguarded and protected shareholders' rights and interests, and laid a solid foundation for
the healthy and sustainable development of the Company. Independent directors paid close attention to the
Company's operation, put forward many valuable professional suggestions for the Company's daily operation and
key concerns, and played an important role in improving the supervision mechanism and safeguarding the
legitimate rights and interests of the Company and all shareholders. The Company strictly fulfilled its obligation
of information disclosure according to law, truly, accurately, completely, timely and fairly disclosed information
that has a significant impact on investment decision-making. The disclosure content was concise and easy to
understand, fully revealed risks, and facilitated all shareholders to consult. According to regulatory requirements,
it further combed and improved relevant systems and enhanced the quality of information disclosure.
During the reporting period, the Company further improved the information disclosure and information
transparency, fulfilled the obligation of information disclosure in strict accordance with regulatory requirements,
communicated with investors through various channels, answered questions raised by investors in a timely manner,
and improved information transparency. Meanwhile, it cooperated with regulatory authorities to safeguard the
rights and interests of investors, especially small and medium-sized investors, and realized the benign interaction
and harmonious development between investors and listed companies.
2. Protection of employees' rights and interests
According to the enterprise development strategy, the Company further revised and improved the human
resource management system. It established labor relations by entering into labor contracts with employees, and
implement necessary management for employees according to the Labor Law and relevant management
regulations of the Company. The Company established a scientific assessment and distribution system according
81
2021 Annual Report
to the classification of senior managers, department managers and employees, established a systematic and
standardized performance assessment and evaluation system, and conducted a comprehensive, objective, fair and
accurate assessment of employees' performance of duties and tasks, which is used as the basis for determining
employees' remunerations, rewards and punishments and appointments. It conducted market-based selection and
employment, created a good environment for talent development, and constantly stimulated innovation vitality
and motivation.
In 2021, the Company strived to create a good corporate culture atmosphere, strengthen the psychological care
for employees, listen to their inner voices, and enhance employees' sense of gain and belonging; Meanwhile, it
further enhanced the Group leaders' understanding of the mind state of grass-roots employees, better cared for and
helped employees to grow into talents, and regularly organized face-to-face communication between the Company
leaders and the core backbone of the Group employees and subordinate enterprises.
In the meantime, the Company newly revised 3 human resource management systems, namely, the Management
Measures of Shenzhen Textile Group's Rank Promotion, the Management System of Shenzhen Textile Group's
Staff Performance Appraisal and the Interim Measures of Shenzhen Textile Group's Annual Advanced Selection,
and optimized and improved the Company's personnel training, performance compensation management and rank
promotion. It actively guided and assisted subordinate enterprises to promote various human resource
management norms, and guided enterprises to strengthen remuneration performance management and make
reasonable adjustments to employees' remuneration level according to the actual situation of each enterprise. It
strengthened the scientific and standardized management of human resources, avoided labor risks, improved the
level of human resources management, and further mobilized the enthusiasm of employees.
3. Environmental protection
Striving to build a modern "green enterprise" is the Company's long-term positive responsibility. We insist on
building the whole process of green cycle in the industrial chain, realizing the real green cycle economy,
improving the quality of the Company's surrounding environment and escorting the Company's production.
During the reporting period, the OSBL noise, industrial wastewater and waste gas emissions in the Company's
production process all passed the monitoring of the environmental protection department, and complied with the
standard requirements of relevant laws and regulations. During the reporting period, the Company's organic waste
gas was treated by the rotary RTO treatment process, and the removal rate of VOCs in organic waste gas reached
over 99%. On the basis of meeting the discharge standards, the pollutant discharge was further reduced, and no
major environmental incidents occurred. In addition, the Company vigorously advocated green office, carried out
various forms of environmental protection publicity and education activities, raised employees' awareness of
energy conservation and emission reduction, realized the coordinated development of production & operation and
environmental protection, and earnestly fulfilled social responsibilities.
4. Protection of consumers' rights and interests
The Company has been adhering to the core values of "honesty oriented and responsibility first". Being
responsible for customers is the source of our enterprise value. It is our unremitting pursuit to provide customers
with professional, personalized and all-round products and services. With customer demand as the core,
continuously innovating to serve customers, and continuously improving and enhancing product quality are the
driving force for the Company to achieve good performance and sustainable development, and also an important
guarantee to win customers' long-term trust. It has provided active attention to customer needs, quick response to
customer feedback, sincere consideration for customers and promotion of long-term cooperative partnership.
82
2021 Annual Report
III. Consolidate and expand the achievements of poverty alleviation and rural revitalization
During the reporting year, the Company did not carry out targeted poverty alleviation work, nor did it have a
follow-up targeted poverty alleviation plan.
VI. Important Events
I. 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
Time of making
Period of
Commitment commitment Fulfillment
Commitment Type Contents commitment
maker
As Shenzhen Investment Holdings
Co., Ltd., the controlling
shareholder of the company,
committed when the
restricted-for-sale shares from the
shares restructuring were listed for
circulation in the market: i. if they
plan to sell the shares through the
securities exchange system in the
future, and the decrease of the
Shenzhen Share
shares they hold reaches 5% within Sustained Under
Commitment Investment reduction August 4,
6 months after the first decrease, and Fulfillme
on share reform Holdings Co., commitmen 2006
they will disclose an announcement effective nt
Ltd. t
indicating the sale through the
company within two trading days
before the first decrease; ii. They
shall strictly observe the
“Guidelines on Transfer of
Restricted-for-sale Original Shares
of Listed Companies” and the
provisions of the relevant business
principles of Shenzhen Stock
Exchange.
83
2021 Annual Report
Commitment in
the acquisition
report or the
report on
equity changes
Commitment
made upon the
assets
replacement
Shenzhen Investment Holdings Co.,
Ltd. signed a “Letter of
Commitment and Statement on
Horizontal Competition Avoidance”
when the company issued
non-public stocks in 2009. Pursuant
to the Letter of Commitment and
Statement, Shenzhen Investment
Holdings Co., Ltd. and its wholly
owned subsidiary, subsidiaries
under control or any other
companies that have actual control
of it shall not be involved in the
Commitme business the same as or similar to
nts on those Shenzhen Textile currently or
Shenzhen horizontal will run in the future, or any
Commitments Sustained Under
Investment competition businesses or activities that may October 9,
made upon and Fulfillme
Holdings Co., , related constitute direct or indirect 2009
issuance effective nt
Ltd. transaction competition with Shenzhen Textile;
and capital if the operations of Shenzhen
occupation Investment Holdings Co., Ltd. and
its wholly owned subsidiaries,
subsidiaries under control or other
companies that have actual control
of it compete with Shenzhen Textile
in the same industry or contradict
the interest of the issuer in the
future, Shenzhen Investment
Holdings Co., Ltd. shall urge such
companies to sell the equity, assets
or business to Shenzhen Textile or a
third party; when the horizontal
competition may occur due to the
business expansion concurrently
84
2021 Annual Report
necessary for Shenzhen Investment
Holdings Co., Ltd. and its wholly
owned subsidiaries, subsidiaries
under control or other companies
that have actual control of it and
Shenzhen Textile, Shenzhen Textile
shall have priority.
The commitments during the period
non-public issuance in 2012: 1.
Shenzhen Investment Holdings, as
the controlling shareholder of
Shenzhen Textile, currently hasn't
the production and business
activities of inter-industry
competition with Shenzhen Textile
or its share-holding subsidiary. 2.
Shenzhen Investment Holdings and
its share-holding subsidiaries or
other enterprises owned the actual
control rights can't be directly and
indirectly on behalf of any person,
company or unit to engage in the
Commitme
same or similar business in any
nts on
districts in the future by the form of
Shenzhen horizontal
share-holding, equity participation, Sustained Under
Investment competition July 14,
joint venture, cooperation, and Fulfillme
Holdings Co., , related 2012
partnership, contract, lease, etc., and effective nt
Ltd. transaction
ensure not to use the controlling
and capital
shareholder's status to damage the
occupation
legitimate rights and interests of
Shenzhen Textile and other
shareholders, or to gain the
additional benefits. 3. If there will
be the situation of inter-industry
competition with Shenzhen Textile
for Shenzhen Investment Holdings
and its share-holding subsidiaries or
other enterprises owned the actual
control rights in the future,
Shenzhen Investment Holdings will
promote the related enterprises to
avoid the inter-industry competition
through the transfer of equity,
assets, business and other ways. 4.
85
2021 Annual Report
Above commitments will be
continuously effective and
irrevocable during Shenzhen
Investment Holdings as the
controlling shareholder of Shenzhen
Textile or indirectly controlling
Shenzhen Textile.
1.The company undertakes not to
provide loans, loan guarantees, and
any other forms of financial
assistance to the incentive objects
for obtaining the restricted stocks in
Equity Shenzhen Other the incentive plan; 2. The company
November May Complete
incentive Textile(Holdi commitmen undertakes that there is no
27,2017 13,2021 d
commitment ngs) Co., Ltd. t circumstance that the stock
incentive shall be prohibited as
stipulated in the provisions of
Article 7 of the “Measures for the
Management of Stock Incentives of
Listed Companies”.
Other
commitments
made to
minority
shareholders
Executed
Yes
timely or not?
If the
commitments
failed to
complete the
execution when
expired, should
specifically Not applicable
explain the
reasons of
unfulfillment
and the net
stage of the
working plan
86
2021 Annual Report
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
II. Particulars about the non-operating occupation of funds by the controlling shareholder
□ Applicable √ Not applicable
None
III. Illegal provision of guarantees for external parties
□ Applicable √ Not applicable
None
IV. Explanation of the Board of Directors on the latest "Non-standard Audit Report"
□ Applicable √ Not applicable
V.Notes for “non-standard audit report” of CPAs firm during the Reporting Period by board of directors
and supervisory board
□ 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
None
VII.Explain change of the consolidation scope as compared with the financial reporting of last year.
√ Applicable □ Not applicable
As of December 31, 2021, the company has included 8 subsidiaries in the scope of consolidation. For details,
please refer to Section 10-9, "Equity in Subsidiaries" of this report. The scope of the company’s consolidation this
year has increased by one household compared to the previous year. For details, please refer to Section 10-8
"Changes in Consolidation Scope for Other Reasons" of this report.
VIII. Engagement/Disengagement of CPAs
CPAs currently engaged
Name of the domestic CPAs Grant Thornton International Ltd （ Special General
87
2021 Annual Report
Partnership）
Remuneration for domestic accounting firm (Ten thousands
87.8
yuan)
Successive years of the domestic CPAs offering auditing
1
services
Name of CPA Chen Zhifang , Liu Duoqi
Continuous years of audit services of certified public The continuous service life of Chen Zhifang's audit service is 1
accountants of domestic public accounting firms year, and that of Liu Duoqi's audit service is 0 year.
Has the CPAs been changed in the current period
□Yes √ No
Description of the CPAs, financial adviser or sponsor engaged for internal control auditing
√ Applicable □Not applicable
During the reporting period, the company engaged Grant Thornton International Ltd (Special General
Partnership) as the company's internal control audit agency for 2021, with an audit remuneration of RMB 878,000
(including travel expenses and other expenses). The related financial statement audit fee is RMB 650,000
(including tax), and the internal control audit fee is RMB 228,000 (including tax).
IX.Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly
Report
□Applicable √ Not applicable
X. Relevant Matters of Bankruptcy Reorganization
□Applicable √ Not applicable
None
XI. Matters of Important Lawsuit and Arbitration
√ Applicable □ Not applicable
Amount Implementati
Whether to Litigation Litigation(arbit
Basic situation of involved on of
form (arbitratio ration)trial Disclosure Disclosure
litigation(arbitrati (Ten litigation(arbi
estimated n)progres results and date index
on) thousand tration)judgm
liabilities s impact
yuan) ents
For details of the The (I) Trial result: For details,
Company's arbitratio Jinjiang Group please refer
matters related to n case is exempted to the
arbitration and was from the company's
compensation of heard at performance March disclosure
24,478.38 No Ruled
its subsidiaries' 9:30 on compensation 30,2021 on March
2019 annual Decembe obligation in 30, 2021.(.
performance r 1, 2020 2019, and does （http://w
commitments, in the not need to pay ww.cninfo.
please refer to Seventh the com.cn）
88
2021 Annual Report
"XVII. Major Arbitratio compensation （Announc
matters of its n for the ement
subsidiaries" in Tribunal performance No.:2021-2
"Section VI of the difference in 9)
Important Arbitratio 2019 of RMB
Matters". n 244,783,800 to
Institute SAPO
in Photoelectric;
Shenzhen The arbitration
Stock fee of RMB
Exchange 2,682,011 and
, and the the actual
arbitratio expenses of the
n tribunal arbitrator of
made a RMB 8,000 in
ruling on this case shall
this case be borne by
on March Jinjiang Group;
25, 2021. Other
arbitration
requests of
Jinjiang Group
are not
supported. This
award shall be
final and take
legal effect
from the date it
is made. (II)
Impact: This
arbitration shall
be final, and
the result of the
arbitration will
not affect the
profit and loss
of the
Company or
the production
and operation
of SAPO
Photoelectric.
The Company
and Jinjiang
89
2021 Annual Report
Group will
continue to
actively
perform their
shareholder
duties based on
the principle of
mutual benefit
and win-win,
and effectively
improve the
production
technology,
management
level and
profitability of
SAPO
Photoelectric.
XII. Situation of Punishment and Rectification
□Applicable √ Not applicable
None
XIII. Credit Condition of the Company and its Controlling Shareholders and Actual Controllers
√ Applicable □ Not applicable
No such cases in the Reporting Period.
XIV. Material related transactions
1. Related transactions in connection with daily operation
□Applicable √ Not applicable
None
2. Related-party transactions arising from asset acquisition or sale
□Applicable √ Not applicable
None
3. Related-party transitions with joint investments
□Applicable √ Not applicable
90
2021 Annual Report
None
4. Credits and liabilities with related parties
□Applicable √ Not applicable
None
5. Transactions with related finance company, especially one that is controlled by the Company
□Applicable √ Not applicable
None
6. Transactions between the financial company controlled by the Company and related parties
□ Applicable √Not applicable
There is no deposit, loan, credit or other financial business between the financial company controlled by the
Company and related parties.
7. Other significant related-party transactions
□Applicable √ Not applicable
None
XV.Significant contracts and execution
1.Entrustments, contracting and leasing
（1）Entrustment
□Applicable √ Not applicable
No such cases in the reporting period.
（2）Contracting
□Applicable √ Not applicable
No such cases in the reporting period.
（3）Leasing
□Applicable √ Not applicable
No such cases in the reporting period.
91
2021 Annual Report
2.Significant Guarantees
√ Applicable □ Not applicable
In RMB10,000
Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries)
Relevant
Guaran
disclosur Date of
tee
e happenin Count Comple
Amount for
Name of date/No. g Actual er-gu te
of Guarante Guaranty Guarant associat
the of (Date of mount of arante implem
Guarante e type （If any） ee term ed
Company the signing guarantee e（If entation
e parties
guarantee agreemen any） or not
(Yes or
d t)
no)
amount
Guarantee of the company for its subsidiaries
Relevant
Guaran
disclosur Date of
tee
e happenin Count Comple
Amount for
Name of date/No. g Actual er-gu te
of Guarante Guaranty Guarant associat
the of (Date of mount of arante implem
Guarante e type （If any） ee term ed
Company the signing guarantee e（If entation
e parties
guarantee agreemen any） or not
(Yes or
d t)
no)
amount
Two
years
from
Guarante the date
SAPO
March Septembe 40,912.7 eing of of
Photoelec 48,000 No No
18,2020 r 8,2020 4 joint expirati
tric
liabilities on of
the
princip
al debt
Total of actual
Total of guarantee for
guarantee for
subsidiaries approved 0 20,353.14
subsidiaries in the
in the period(B1)
period (B2)
Total of guarantee for Total of actual
48,000 40,912.74
subsidiaries approved guarantee for
92
2021 Annual Report
at period-end(B3) subsidiaries at
period-end(B4)
Guarantee of the subsidiaries for the controlling subsidiaries
Relevant
Guaran
disclosur Date of
tee
e happenin Count Comple
Amount for
Name of date/No. g Actual er-gu te
of Guarante Guaranty Guarant associat
the of (Date of mount of arante implem
Guarante e type （If any） ee term ed
Company the signing guarantee e（If entation
e parties
guarantee agreemen any） or not
(Yes or
d t)
no)
amount
The Company’s total guarantee(i.e. total of the first three main items)
Total amount of
Total guarantee quota guarantee actually
approved in the reporting 0 incurred in the 20,353.14
period（A1+B1+C1）
reporting period
（A2+B2+C2）
Total guarantee quota already Total balance of the
approved at the end of the actual guarantee at the
48,000 40,912.74
reporting period end of the reporting
（A3+B3+C3） period（A4+B4+C4）
The proportion of the total amount of actually
guarantee in the net assets of the Company (that 14.52%
is A4+B4+C4）%
Including：
Amount of guarantees provided for
shareholders, the actual controller and their 0
related parties (D)
Amount of debt guarantees provided directly or
indirectly for entities with a liability-to-asset 0
ratio over 70% (E)
Portion of the total guarantee amount in excess
0
of 50% of net assets (F)
Total amount of the three kinds of guarantees
0
above (D+E+F)
Description of the guarantee with complex method
None
3.Situation of Entrusting Others for Managing Spot Asset
93
2021 Annual Report
(1)Situation of Entrusted Finance
√ Applicable □Not applicable
Overview of entrusted wealth-management during the reporting period
In RMB 10,000
Source of funds for The Occurred Amount
Specific Un-recovered of
entrusted financial of Entrusted Undue balance Amount overdue
type overdue amount
management Wealth-management
Other Self fund 58,654.07 0 0 0
Total 58,654.07 0 0 0
The detailed information of entrusted wealth-management with significant amount or low safety, poor liquidity or
high risk with no promise of principal
√ Applicable □Not applicable
In RMB10,000
Nam Type Prod Am Capi Start Expi Fun Met Refe Exp Act The Am Wh Wh Su
e of of uct ount tal Date ry ds hod renc ecte ual actu ount ethe ethe mm
Trus Trust Type Sour Date Allo of e d prof al of r r ary
tee ee ce cati Rew Ann Inco it reco prov pass ther of
Org Orga on ard uali me and very isio ed e is eve
aniz nizat Dete zed (if loss of n the any nts
atio ion( rmin Rate any) duri prof for stat entr and
n (or or atio of ng it imp utor uste relat
Trus Trust n Retu the and airm y d ed
tee ee) rn repo loss ent proc fina sear
Nam rting duri (if edur ncia ch
e) peri ng any) e l inde
od the plan x (if
repo in any)
rting the
peri futu
od re
Sout Red
hern emp
Asse tion
Sept Dec
ts on T Not
Mon 58,6 emb emb Not
Man Self Oth day, 2.54 451. 451. appl
Fund etary 54.0 er er expi Yes
age fund er arriv % 91 91 icab
fund 7 8,20 31,2 r ed
men al le
20 021
t on
Co., T+1
Ltd. day
58,6
451. 451.
Total 54.0 -- -- -- -- -- -- -- -- -- --
91 91
7
Entrusted financing appears to be unable to recover the principal or there may be other circumstances that
may result in impairment
94
2021 Annual Report
□ Applicable √ Not applicable
(2)Situation of Entrusted Loans
□ Applicable √ Not applicable
None
4. Other significant contract
√ Applicable □ Not applicable
Com Com Contr Contr Book Asses Appr Base Prici Trans Whet Conn Exec Date Discl
pany pany act act Value sed aisal Date ng actio her A ectio ution of osure
Nam Nam Obje Signi of the Value Agen of Princ n Relat n Cond Discl Index
e of e of ct ng Asset of the cy Asses iple Price ed Relat ition osure
the the Date s Asset Nam smen (Ten Tract ion As
Party Other Invol s e (If t (if thous ion Of
Maki Party ved Invol Any) any) and) The
ng of the by ved End
the Contr the by Of
contr act Contr the The
act act Contr Repo
(Ten act rting
thous (Ten Perio
and thous d
yuan) and
yuan)
SAP Hang Nitto Nove Consi With In Nove
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price
is
95
2021 Annual Report
based
on
the
com
merci
al
negot
iation
result
s of
both
partie
s.
XVI. Explanation on other significant events
√ Applicable □Not applicable
1. Progress of polarizer industrialization project for ultra-large TV (Line 7)
During the reporting period, the Company strengthened staffing and resource support, overcame the adverse
effects caused by the pandemic, accelerated the progress of chemical test run of Line 7 project, and finally
completed the performance stability test run and started trial production ramp up in July 2021. As of December 31,
2021, Line 7 was in the stage of capacity ramp up, the main technical indicators such as speed and yield were
continuously improved, and the introduction of major customer products was progressing steadily, laying a solid
foundation for the rapid increase of oversized orders in 2022 and the realization of production line profitability.
On March 16, 2021, all the funds raised from the special account for raising funds of Line 7 project have been
used up according to regulations, and the company has canceled the special account for raising funds. For details,
please refer to Announcement No.:2021-30 of cninfo (http://www.cninfo.com.cn).
As of December 31, 2021, the accumulated signed contract amount of Line 7 project was RMB 2,091.2441
million, and the actual payment was RMB 2,017.5184 million (with raised funds of RMB 409.9535 million, and
its own funds and government funds of RMB 1,607.5649 million).
2. Regarding the investment in the construction of the RTS rear cutting production line
During the reporting period, the company added investment in the construction of a cutting production line for
the rear end of the RTS after careful evaluation. The total investment was controlled at 30 million yuan, and the
source of funds was its own funds and bank loans. The main reasons for this investment: First, to meet the needs
of downstream panel customers, increase the depth of customer cooperation, and seize the market share of
high-margin large-size products; second, to improve the overall cutting capacity of the back end; third, to simplify
the production process and improve production efficiency. reduce manufacturing cost.
As of December 31, 2021, The Company is building 2 RTP production lines, one of which has been put into mass
production, and the other one is subject to mass production ramp-up; 2 RTS production lines have been built，and
1 RTS production line is under construction. It is expected to achieve mass production before the first quarter of
2022.
3. The disposal of assets of the joint venture company Xieli Automobilemobile Co., Ltd.
Shenzhen Xieli Automobilemobile Enterprise Co., Ltd. (hereinafter referred to as "Shenzhen Xieli") is a
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2021 Annual Report
Sino-foreign joint venture invested and established by the company and Hong Kong Xieli Maintenance Company
in 1981, with a registered capital of 3.12 million yuan, and the company holds 50% of the equity. The company's
operating period ended in 2008, and its business license was revoked in 2014. The company's main asset is real
estate. The industrial and commercial license of Shenzhen Xieli was cancelled in March 2020, but there are still
three properties under its name, the disposal of which is required to be resolved after further consultation between
the shareholders of both parties.
On July 26, 2021, the Company filed a lawsuit with Yantian District People's Court in Shenzhen City,
Guangdong Province to revoke the cancellation of Shenzhen Xieli Automobilemobile Enterprise Co., Ltd.
approved by Shenzhen Administration for Market Regulation on March 9, 2020, on which the court gave a
judgment on November 21, 2021 to revoke the cancellation of Shenzhen Xieli Automobilemobile Enterprise Co.,
Ltd. approved by Shenzhen Administration for Market Regulation.
XVII. Significant event of subsidiary of the Company
√ Applicable □Not applicable
1.Matters concerning the company's compensation for arbitration and its subsidiaries' annual performance
commitments in 2019
On March 9, 2020, the company received the Notice of Arbitration (No.452 -2) from Shenzhen International
Arbitration Court and the Application for Arbitration submitted by Hangzhou Jinjiang Group Co., Ltd., which is
the applicant of this arbitration while the company is the respondent. Hangzhou Jinjiang Group Co., Ltd.
submitted the following arbitration requests: 1. The ruling made the following changes to the Cooperation
Agreement: (1) Delete the original Article 3.1 of the Cooperation Agreement and the relevant unfulfilled rights
and obligations will no longer be fulfilled (2) Delete the original Article 6.4 of the Cooperation Agreement, and
the relevant unfulfilled rights and obligations will no longer be fulfilled; 2. The respondent shall bear the
arbitration fee of the case and the actual expenses of the arbitral tribunal. The applicant reserves the right to
further modify the arbitration request. For details, please refer to the Announcement of 2020-07 on the website of
http://www.cninfo.com.cn.
On March 26, 2020, the company received the Notice on Extending the Time Limit Appointed by Arbitrators
(2020 SGZS No.452 -3) delivered by Shenzhen International Arbitration Court. Due to the complexity of the
dispute and the special epidemic background, the applicant needs extra time to negotiate and communicate the
procedural matters of the case with the respondent, so it applies to Shenzhen International Arbitration Court to
extend the time limit for appointing arbitrators in this case. Shenzhen International Arbitration Court believes that
the applicant's request is reasonable, and both parties are requested to notify Shenzhen International Arbitration
Court in writing of the arbitrator's appointment result before March 30, 2020. Therefore, the company shall
appoint an arbitrator before March 30, 2020 instead of within 15 days after receiving the arbitration notice on
March 9, 2020, and notify the Shenzhen International Arbitration Court of the results in writing. For details,
please refer to the Announcement of 2020-21 on the website of http://www.cninfo.com.cn.
On April 17, 2020, the company received the Notice of Arbitral Tribunal Composition (2020 SGZS No.452-4)
from Shenzhen International Arbitration Court. Both parties to the arbitration informed Shenzhen International
Arbitration Court in writing of the results of arbitrator selection according to the arbitration procedure before
March 30, 2020, and appointed 1 arbitrator respectively and 1 chief arbitrator together. On April 16, 2020, the
arbitration tribunal was formed to hear the case.
On December 1, 2020, the arbitration case was heard in the Seventh Arbitration Tribunal of the Court of
Arbitration located at the Shenzhen Stock Exchange.
On March 25, 2021, the company received the Award (2020 SGZC No.452) delivered by the arbitral tribunal,
and made a ruling on this case: 1. The applicant was exempted from fulfilling the 2019 annual performance
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2021 Annual Report
compensation obligation stipulated in Article 3.1 of the Cooperation Agreement, and does not need to pay SAPO
Photoelectric the compensation for the difference in performance in 2019 of RMB 244,783,800; 2. The arbitration
fee of RMB 2,682,011 and the actual expenses of the arbitrator of RMB 8,000 shall be borne by the applicant; 3.
The applicant's other arbitration requests are not supported. This award is final and shall come into force as of the
date of its making. This arbitration is the final award, and the award result will not affect the company's profit and
loss, nor will it affect the production and operation of SAPO Photoelectric. The company and Jinjiang Group will
continue to actively perform their shareholders' duties based on the principle of mutual benefit and win-win, and
effectively improve the production technology, management level and profitability of SAPO Photoelectric. For
details, please refer to the Announcement on Arbitration Results of the Company on Juchao Information Network
(http://www.cninfo.com.cn) (No.2021-29).
2.Progress in subsidiaries participating in the establishment of industrial funds
On November 16, 2017, the company's controlling subsidiary SAPO Photoelectric signed the Changxing Junying
Equity Investment Partnership (Limited Partnership) Agreement with the fund manager Huizhi Investment
Management Co., Ltd, general partner Jinxin Investment Co., Ltd and other limited partners, and co-sponsored the
establishment of an industrial fund, focusing on the optical film industry chain related projects related to the
company's main business, with a fund size of 50 million yuan. SAPO Photoelectric, as one of the limited partners
of the industrial fund, subscribed for a capital contribution of 28.5 million yuan.
For details Juchao Website:（http://www.cninfo.com.cn. (Announcement No.2017--55).
On February 10, 2018, Changxing Junying Equity Investment Partnership completed the industrial and
commercial registration and completed the private equity investment fund registration on February 8, 2018. For
details Juchao Website:（http://www.cninfo.com.cn. (Announcement No.2018--05).
As of December 31, 2021, Changxing Junying had accumulated 3 investment projects with a total investment of
42 million yuan.
Fund contribution
No Name Investment
（RMB 10,000）
1 Shenzhen Kaichuang Shijia Technology Co., Ltd. Optical Film 1,400
2 Shenzhen Shenfuyu Electronic Technology Co., Ltd. Optical Film 1,300
3 Shenzhen Hengbaoshun Technology Development Co., Ltd. Optical Film 1,500
3, Matters concerning the subsidiary's accreditation by Guangdong Engineering Technology Research Center
On August 20, 2021, the Guangdong Provincial Department of Science and Technology issued the "Notice of the Guangdong
Provincial Department of Science and Technology on Recognizing the 2021 Guangdong Engineering Technology Research Center"
(Yue Ke Han San Zi [2021] No. 1021), according to the results of expert review , the "Guangdong Province Shengbo Optoelectronics
Engineering Technology Research Center in the Field of New Materials" built by the company's holding subsidiary Shengbo
Optoelectronics was identified as the "2021 Guangdong Engineering Technology Research Center".
This recognition fully affirms the company's strong technological innovation and R&D strength, demonstrates the company's
significant advantages in technological innovation, technology research and development and talent teams in the field of polarizers,
and helps the company to continuously improve the level of scientific research and scientific and technological achievements. The
ability to transform and enhance the company's market competitive advantage is the embodiment of the company's comprehensive
strength. The company will continue to build the research center, combine the company's business strategy, deepen
industry-university-research cooperation, cultivate scientific and technological innovation talents, vigorously promote technological
innovation, and provide a favorable platform support for promoting the high-quality development of the polarizer business.
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2021 Annual Report
4.Matters on the listing and leasing of some properties in Block C of Shenzhen Textile Building
On July 13, 2021, the company held the fifth meeting of the eighth board of directors to review and approve the
Proposal on Listing and Leasing Some Properties in Block C of Shenzhen Textile Building, and agreed that the
company will publicly list and lease 6,100 square meters of properties of the 8F-10F and 1F lobby of Block C of
Shenzhen Textile Building through Shenzhen United Property and Share Rights Co., Ltd., with a lease term of 10
years (including a rent-free period of 6 months), and the rental price is not lower than 85 yuan/ ㎡ /month
(including property management fee). The rent will increase by 5% every three years from the date of contract
conclusion, and the final transaction price will be determined according to the listing result. For details, please
refer to the Announcement of Resolutions of the Fifth Meeting of the Eighth Board of Directors of the company
(No.2021-44) on Juchao Information Network (http://www.cninfo.com.cn).
On September 18, 2021, the Company received the Notice of Lease Result from Shenzhen United Property and
Equity Exchange Co., Ltd., confirming that the lessee was Shenzhen Haizhiguang Hotel Management LTD, with a
lease term of 10 years (including 6 months rent-free period), at a transaction price of 86 yuan/m2/month (including
property management fee), and the rent will increase by 5% every three years since the signing of the contract; On
September 17, 2021, the Company signed the contract with the lessee, and the follow-up leased property was
planned to be used for the operation of Atour Hotel.
Regarding partial premises in Block C of Shenzhen Textile Building for lease this time, it will transfer the
market risk from self-operated hotels to brand hotel operators through overall external lease, which will help
improve the overall operational efficiency of the Company's assets, reduce operational risks, bring stable rental
income to the Company and help to maintain and increase the value of state-owned assets.
5. Matters on liquidation and cancellation of Shenzhen Textile Import & Export Co., Ltd.
On July 13, 2021, the company held the fifth meeting of the eighth board of directors to review and approve the
Proposal on Liquidation and Cancellation of Shenzhen Textile Import & Export Co., Ltd., and agreed on the
Liquidation Report of Shenzhen Textile Import & Export Co., Ltd.. completed by the liquidation group, and
liquidated and distributed its assets in accordance with legal procedures, and completed formalities such as
industrial and commercial cancellation. The liquidation and cancellation of Shenzhen Textile Import & Export Co.,
Ltd. (hereinafter referred to as "Shenzhen Textile Import & Export") will change the scope of the company's
consolidated financial statements, facilitate the disposal of inefficient assets, reduce management costs, and will
not affect the company's production and operation. The impact of the cancellation of Shenzhen Textile Import &
Export in this liquidation on the current profits and losses is estimated to be RMB 7.64 million, The annual audit
of the audit institution has been confirmed. For details, please refer to the Announcement on Liquidation and
Cancellation of Shenzhen Textile Import & Export. (No.2021-45) issued by Juchao Information Network
(http://www.cninfo.com.cn).
6. Matters on waiver of preemption right and equity transfer of holding subsidiaries
On November 27, 2020, the company received the "Letter" sent by Jinjiang Group, informing the company in
writing that it intends to acquire the 40% equity of SAPO Photoelectric held by Hangzhou Jinhang Equity
Investment Fund Partnership (Limited Partnership) (hereinafter referred to as "Jinhang Investment"); On
December 21, 2020, the company received the Notice of Equity Transfer from Jinhang Investment, informing the
company in writing that Jinhang Investment intends to transfer its 40% equity of SAPO Photoelectric, and
according to the Company Law of the People's Republic of China and the Articles of Association of Shenzhen
SAPO Photoelectric Technology Co., Ltd., it specially sought the company's opinions on the transfer matters.
On December 25, 2020, after research and decision-making, the company formally replied to Jinhang
Investment, and the company gave up the preemptive right to exercise the 40% equity of SAPO Photoelectric, the
99
2021 Annual Report
holding subsidiary of the company held by Jinhang Investment. For details, please refer to the Announcement on
Waiver of Preemptive Rights of Holding Subsidiaries (No.2020-57) on Juchao Information Network
(http://www.cninfo.com.cn) on December 26, 2020.
In July 2021, the company received the Letter from Jinjiang Group, informing the company about the progress
of the above-mentioned equity transfer: Jinhang Investment and the intended transferee Suzhou Advantage Ford
Investment Center (Limited Partnership) (hereinafter referred to as "Advantage Ford") have completed their
internal decision-making examination and approval, and the delivery conditions for Advantage Ford to accept
100% of the partnership share of Jinhang Investment have been met, and both parties will promote the transfer of
the partnership share. After the completion of the transfer procedure, Advantage Ford will directly hold
99.93333% of the partnership share of Jinhang Investment; Meanwhile, Zhejiang Hengjie Industrial Co., Ltd.
indirectly holds a partnership share of 0.06667% of Jinhang Investment. As of July 28, 2021, for the above equity
transfer, the industrial and commercial change registration procedures have been completed. After the completion
of this equity transfer, the shareholders and equity ratio of SAPO Photoelectric, the holding subsidiary of the
company, remain unchanged, and the scope of the consolidated statements of the company has not changed.
Advantage Ford holds 40% equity of SAPO Photoelectric through Jinhang Investment, and the strategic investor
of SAPO Photoelectric will be changed from Jinjiang Group to Advantage Ford. Advantage Ford has rich
industrial resources, industrial investment and management experience, and both parties will give full play to their
respective advantages to further improve and strengthen the main business of polarizer. For details, please refer to
the Progress Announcement on Waiver of Preemptive Rights and Equity Transfer of Holding Subsidiaries
(No.2021-47) on Juchao Information Network (http://www.cninfo.com.cn).
100
2021 Annual Report
VII. 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 Capitali
on zation
Share of
Bonus Quantit Proport
allotme commo Other Subtotal
shares y ion
nt n
reserve
fund
1.Shares with conditional 1,326,4 -1,254,4 -1,254,4
0.26% 0 0 0 72,000 0.00%
subscription 05 05 05
1.State -owned shares 0 0.00% 0 0 0 0 0 0 0.00%
2. State-owned legal person
0 0.00% 0 0 0 0 0 0 0.00%
shares
1,326,4 -1,254,4 -1,254,4
3.Other domestic shares 0.26% 0 0 0 72,000 0.00%
05 05 05
Incl：Domestic legal person
0 0.00% 0 0 0 0 0 0 0.00%
shares
Domestic Natural Person 1,326,4 -1,254,4 -1,254,4
0.26% 0 0 0 72,000 0.00%
shares 05 05 05
4.Foreign share 0 0.00% 0 0 0 0 0 0 0.00%
Incl：Foreign legal person
0 0.00% 0 0 0 0 0 0 0.00%
share
Foreign Natural
0 0.00% 0 0 0 0 0 0 0.00%
Person shares
II.Shares with 506,445 506,44
99.74% 0 0 0 3,975 3,975 1.00%
unconditional subscription ,874 9,849
457,017 457,02
1.Common shares in RMB 90.00% 0 0 0 3,975 3,975 0.90%
,874 1,849
2.Foreign shares in 49,428, 49,428,
9.74% 0 0 0 0 0 0.10%
domestic market 000 000
3. Foreign shares in foreign
0 0.00% 0 0 0 0 0 0 0.00%
market
4.Other 0 0.00% 0 0 0 0 0 0 0.00%
III. Total of capital shares 507,772 100.00 0 0 0 -1,250,4 -1,250,4 506,52 100.00
101
2021 Annual Report
,279 % 30 30 1,849 %
Reasons for share changed
√ Applicable □Not applicable
The company’s performance in 2020 did not meet the conditions for the release of the second sale restriction
period stipulated in the 2017 Restricted Stock Incentive Plan, according to the company’s Restricted Stock
Incentive Plan in 2017,Chapter VIII of the restricted stock grant conditions And the conditions for lifting the sales
restriction ,If the conditions for lifting the sales restriction in the current period are not met, the company will
repurchase the restricted stocks that can be released for the current year and cancel them in accordance with the
provisions of this plan. The second phase held by the company for 102 incentive objects The 1,236,480 restricted
stocks that did not meet the conditions for lifting the restrictions were repurchased and cancelled. Secondly , the
company's original incentive object Jiang Shengyuan left due to personal reasons,. According to the relevant
provisions of the Incentive Plan (Draft), the above-mentioned personnel no longer meet the incentive conditions,
and the company shall repurchase and cancel the 7，950 restricted stocks that have been granted but not yet lifted.
Thirdly, the company’s original incentive object, Mu Linying, retires. According to the company’s "2017
Restricted Stock Incentive Plan", this person no longer meets the incentive conditions, and the company has
granted 6,000 restricted stocks that have not been lifted. Cancellation of repurchase. In summary, a total of
1,250,430 restricted stocks were repurchased and cancelled. For details, please refer to the "Announcement on
Repurchase and Cancellation of Certain Restricted Stocks" (No. 2021-03 and 2021-25, 2021-30) of the company
on www.cninfo.com.cn. On May 13, 2021, the company completed the repurchase and cancellation procedures of
the above-mentioned restricted stocks at the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited. For details Juchao Website:（http://www.cninfo.com.cn. (Announcement No.2021--35).
In addition, Zhang Xiaodong, the former employee supervisor of the company, resigned on February 10, 2021,
and his 1,325 unrestricted shares were converted into restricted shares. On August 11, 2021, the sales restrictions were
lifted, and they were converted into unrestricted shares.
Approval of Change of Shares
√ Applicable □ Not applicable
The above repurchase and cancellation of some restricted stocks were approved by the 35th meeting of the
seventh Board of Directors of the company, the 25th meeting of the seventh Board of Supervisors, the first
provisional shareholders' general meeting of 2021, the second meeting of the eighth Board of Directors, the
second meeting of the eighth Board of Supervisors, and the annual shareholders' general meeting of s 2020. For
details Juchao Website:（http://www.cninfo.com.cn. (Announcement No.2021--01， 2021-02，2021-11，2021-17，
2021-18 and 2021-31).
Ownership transfer of share changes
√ Applicable □ Not applicable
Regarding the transfer of the above restricted stocks, Peking Certified Public Accountants (special general
partnership) verified some restricted stocks cancelled by the above repurchase and issued the capital verification
report QXYZ/2021 0013. On May 13, 2021, the company completed the repurchase and cancellation procedures
of the above-mentioned restricted stocks at the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited. For details Juchao Website:（http://www.cninfo.com.cn. (Announcement No.2021--35).
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
102
2021 Annual Report
After the Company repurchased and cancelled some restricted stocks, the total capital of the Company was
changed from 507,772,279 shares to 506,521,849 shares. The impact of this share change on the Company's
financial indicators such as basic earnings per share and diluted earnings per share, net assets per share
attributable to the company's common shareholders in the latest year and period is as follows:
Items 2020 2021
According to the original According to the new According tot he new
capital capital capital
Basic earnings per share (yuan/share) 0.07 0.07 0.12
Diluted earnings per share 0.07 0.04 0.08
Net assets per share 5.45 5.46 5.56
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
In Shares
Number of Number of Restricted
Initial Date of
Sharehold Unrestricted Increased Shares in the Reason for Restricted
Restricted Restriction
er Name Shares This Restricted Shares End of the Shares
Shares Removal
Term This Term Term
Supervisors shall not
transfer their shares in
Zhang August
3,975 1,325 5,300 0 the company within the
Xiaodong 11,2021
half year after
resignation
Total 3,975 1,325 5,300 0 -- --
II. Securities issue 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
For details, please refer to "XI. Implementation of the Company's equity incentive plan, employee stock
ownership plan or other employee incentive measures 1. Equity incentive" in "Section IV Corporate Governance"
of this report.
103
2021 Annual Report
3.About the existing employees’ shares
□Applicable √Not applicable
III. Shareholders and actual controlling shareholder
1. Number of shareholders and shareholding
In Shares
Total
preference
shareholders
Total number Total
The total number with
of common shareholders at
of preferred shar voting rights
shareholders the end of the
eholders voting r recovered at
at the end of 25,021 month from 24,982 0 0
ights restored at end
the the date of
period-end (if of last month
reporting disclosing the
any)(Note 8) before annual
period annual report
report
disclosed(if
any)(Note8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Numbe Amoun Amount Number of share pledged/frozen
Proport Change
r of t of of
ion of s in
Nature of shares restrict un-restri
Shareholders shares reportin
shareholder held at ed cted State of share Amount
held g
period shares shares
（%） period
-end held held
Shenzhen
Investment State-owned 234,06 234,069
46.21% 0
Holdings Co., legal person 9,436 ,436
Ltd.
Shenzhen
Shenchao
State-owned 16,129, 16,129,
Technology 3.18% 0
Legal person 032 032
Investment Co.,
Ltd.
Domestic 6,008,6 2,783,8 6,008,6
Sun Huiming 1.19%
Nature person 53 86 53
Domestic 4,993,8 2,716,1 4,993,8
Deng Yan 0.99%
Nature person 00 00 00
104
2021 Annual Report
Domestic 2,823,0 2,823,0
Su Weipeng 0.56% 0 Pledge 2,800,000
Nature person 66 66
Domestic 2,792,4 2,792,4 2,792,4
Mao Yuxia 0.55%
Nature person 00 00 00
China
Construction
Bank -Cinda
Australia Bank 2,477,7 2,477,7 2,477,7
Other 0.49%
New Energy 20 20 20
Industry Equity
Securities
Investment Fund
Domestic 2,218,8 920,10 2,218,8
Qi Jianhong 0.44%
Nature person 00 0 00
Domestic 2,082,9 484,20 2,082,9
Li Zengmao 0.41%
Nature person 97 0 97
Domestic 1,808,8 1,808,8 1,808,8
Zhang Muxiu 0.36%
Nature person 00 00 00
Strategy investors or general legal
person becomes top 10 shareholders
None
due to rights issued (if applicable)
（See Notes 3）
Among the top 10 common shareholders, Shenzhen Investment Holdings Co., Ltd. and
Shenzhen Shenchao Technology Investment Co., Ltd. do not constitute a concerted party
Explanation on shareholders relationship. In addition, the company does not know whether there is an associated
participating in the margin trading relationship among the top 10 ordinary shareholders, and between the top 10 ordinary
business shareholders and the top 10 shareholders, or whether they are persons taking concerted
action defined in Regulations on Disclosure of Information about Shareholding of
Shareholders of Listed Company.
Above shareholders entrusting or
entrusted with voting rights, or None
waiving voting rights
Top 10 shareholders including the
special account for repurchase (if None
any) (see note 10)
Shareholding of top 10 shareholders of unrestricted shares
Quantity of unrestricted shares held at the end of Share type
Name of the shareholder
the reporting period Share type Quantity
Shenzhen Investment Holdings Co., Common
234,069,436 234,069,436
Ltd. shares in RMB
105
2021 Annual Report
Shenzhen Shenchao Technology Common
16,129,032 16,129,032
Investment Co., Ltd. shares in RMB
Foreign shares
Sun Huiming 6,008,653 in domestic 6,008,653
market
Common
Deng Yan 4,993,800 4,993,800
shares in RMB
Common
Su Weipeng 2,823,066 2,823,066
shares in RMB
Common
Mao Yuxia 2,792,400 2,792,400
shares in RMB
China Construction Bank -Cinda
Australia Bank New Energy Common
2,477,720 2,477,720
Industry Equity Securities shares in RMB
Investment Fund
Common
Qi Jianhong 2,218,800 2,218,800
shares in RMB
Common
Li Zengmao 2,082,997 2,082,997
shares in RMB
Common
Zhang Muxiu 1,808,800 1,808,800
shares in RMB
Explanation on associated Among the top 10 common shareholders, Shenzhen Investment Holdings Co., Ltd. and
relationship or consistent action Shenzhen Shenchao Technology Investment Co., Ltd. do not constitute a concerted party
among the top 10 shareholders of relationship. In addition, the company does not know whether there is an associated
non-restricted negotiable shares and relationship among the top 10 ordinary shareholders, and between the top 10 ordinary
that between the top 10 shareholders shareholders and the top 10 shareholders, or whether they are persons taking concerted
of non-restricted negotiable shares action defined in Regulations on Disclosure of Information about Shareholding of
and top 10 shareholders Shareholders of Listed Company.
Explanation on shareholders
participating in the margin trading None
business(if any )(See 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: Local state holding
Type: Legal person
106
2021 Annual Report
Name of the Legal
Date of Organization
Controlling representative/ Principal business activities
incorporation code
shareholder Leader
Investment and acquisition of financial and similar
financial stock rights such as bank, security,
insurance, fund and guarantee; Engage in real
estate development and management business
within the limit of legally-acquired land use right;
Carry out investment and service in the field of
strategic emerging industry; Carry out investment,
Shenzhen
operation and management of state-owned stocks
Investment October
He Jianfeng 76756642-1 of wholly-owned, holding and joint-stock
Holdings Co., 13,2004
company by reorganization & integration, capital
Ltd.
operation and asset disposal; Other businesses
undertaken by authorization of municipal
SASAC(State Asset Supervision and
Administration Commission) (If the above
business scope needs to be approved according to
national regulations, the business can only be
operated after the approvalis obtained)
Shen PropertyA（000011），Quantity of shares 301.41 million，Shareholding ratio：50.57%；SPGA（000029），
Quantity of shares 578.6 million，Shareholding ratio：57.19%；Shen Universe A（000023），Quantity of shares
9.59 million，Shareholding ratio：6.91%；Pingan （601318），Quantity of shares962.72 million，Shareholding
Equity of other
ratio：5.27%；Guosen Securities（002736），Quantity of shares 3,223.11 million，Shareholding ratio：33.53%；
domestic/foreign
Guotai Junan（601211），Quantity of A shares 609.43 million，Quantity of H shares 103.37 million，Total
listed company
shareholding ratio：8.00%；Telling Holding（000829），Quantity of shares 195.03 million，Shareholding
with share
ratio：19.03%；Shenzhen International（00152），Quantity of shares 985.64 million，Shareholding ratio：
controlling and
43.48%；Beauty Star（002243），Quantity of shares 604.82 million，Shareholding ratio:49.96%；Hopewell
share
Highway（00737），Quantity of shares 2,213.45 million，Shareholding ratio:71.83%；Infinova（002528），
participation by
Quantity of shares 315.83 million, Shareholding ratio:26.35%；Eternal Asia（002183），Quantity of shares
controlling
388.45 million, Shareholding ratio:14.96%；Shen Energy（000027)，Quantity of shares 6.77 million，
shareholder in
Shareholding ratio:0.14%；Bank Communication（601328），Quantity of shares 9.52 million , Shareholding
reporting period
ratio:0.01%；Tehan Ecological（300197），Quantity of shares 113.98 million, Shareholding ratio:4.04%；
China VANKE（02202），Quantity of shares 77.27 million,Shareholding ratio:0.66%；Shenzhen Water
（301038），Quantity of shares 49.50 million，Shareholding ratio:37.50%.
Changes of controlling shareholder in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in reporting period.
3．Information about the controlling shareholder of the Company
Actual controller nature：Local state owned assets management
Actual controller type：Legal person
107
2021 Annual Report
Legal
Date of
Name of the actual controller representative Organization code Principal business activities
incorporation
/Leader
Performing the responsibilities
State-owned Assets of investors on behalf of the
Regulatory Commission of state and supervising and
Wang Yongjian July 30,2004 K3172806-7
Shenzhen Municipal People's managing state-owned assets
Government according to authorization and
law.
Equity of other
domestic/foreign listed
company with share It directly held 40.10% equity of Shenzhen Gas (601139); It directly held 21.93% equity of
controlling and share Shenzhen Zhenye (000006); It directly held 43.91% equity of Shenzhen Energy (000027);
participation by controlling
shareholder in reporting
period
Changes of controlling shareholder in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in 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.The cumulative number of shares pledged by the controlling shareholder or the largest shareholder of the
company and its person acting in concert accounts for 80% of the number of shares held by the company
□Applicable √Not applicable
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2021 Annual Report
5.Particulars about other legal person shareholders with over 10% share held
□Applicable √Not applicable
6.Situation of Share Limitation Reduction of Controlling Shareholders, Actual Controllers, Restructuring Party
and Other Commitment Subjects
□Applicable √Not applicable
IV. Specific implementation of share repurchase during the reporting period
Progress in implementation of share repurchase
□ Applicable √Not applicable
Implementation progress of reducing repurchased shares by centralized bidding
□ Applicable √Not applicable
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2021 Annual Report
VIII. Situation of the Preferred Shares
□Applicable √Not applicable
The Company had no preferred shares in the reporting period.
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2021 Annual Report
IX. Corporate Bond
□ Applicable √ Not applicable
111
2021 Annual Report
X. Financial Report
(1) Audit report
Type of audit opinion Standard Unqualified opinion
Date of signature of audit report March 15,2022
Name of audit firm Grant Thornton International Ltd.(Special General Partnership)
The audit report number Zi Tong Shen Zi（2022）No.:441A002000
Names of the Certified Public Accountants Chen Zhifang, Liu Duoqi
Auditors’ Report
To all shareholders of Shenzhen Textile (Holdings) Co., Ltd.：
I. Opinion
We have audited the financial statements of Shenzhen Textile (Holdings) Co., Ltd . (hereinafter referred to as "the
Company"), which comprise the balance sheet as at December 31, 2021, and the income statement, the statement
of cash flows and the statement of changes in owners' equity for the year then ended and notes to the financial
statements.
In our opinion, the attached financial statements are prepared, in all material respects, in accordance with
Accounting Standards for Business Enterprises and present fairly the financial position of the Company as at
December 31, 2021 and its operating results and cash flows for the year then ended.
II. Basis for Our Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants in China. Our
responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the
Financial Statements section of our report. According to the Code of Ethics for Chinese CPA, we are independent
of the Company in accordance with the Code of Ethics for Chinese CPA and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of
the financial statements of the current period. These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
(1) Recognition of revenue
Please refer to Note V, 26 and Note VII, 42 to the financial statement for details of the relevant information
disclosure.
1. Description of matters
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2021 Annual Report
The operating income of Shenzhen Textile in 2021 was RMB 2,293.7479 million, of which the main
business income was RMB 2,265.9906 million, accounting for 98.79%. As revenue is one of the key performance
indicators of Shenzhen Textile, there is inherent risk that the Company's management manipulates revenue
recognition in order to achieve specific goals or expectations, and since the main business income is large, we
identify revenue recognition as a key audit item.
2. Response to the audit
For revenue recognition, we mainly implemented the following audit procedures:
(1) Understand, evaluate and test the design effectiveness and operation effectiveness of internal control
related to sales revenue cycle;
(2) Obtain the main sales contracts according to the products and business types, check the relevant clauses
related to revenue recognition, and interview the management to evaluate whether the revenue recognition meets
the requirements of accounting standards;
(3) Implement analytical procedures, compare the changes of income between this year and last year
according to product types, observe the fluctuations of income between months and the changes of important
customers in this period, and analyze the rationality of income changes based on factors such as the company's
production capacity, market expansion and industry trends;
(4) Perform detailed tests to check whether the basis related to sales revenue recognition is sufficient,
including checking sales contracts or performing detailed tests, including checking sales contracts or orders,
delivery orders, customs declarations and other supporting documents, evaluate the authenticity and accuracy of
revenue recognition, and evaluate the authenticity and accuracy of revenue recognition;
(5) Perform cut-off test to evaluate whether income is recorded in the proper accounting period;
(6) Select samples from major customers on this recognition procedures, and perform alternative tests on the
non-replied parts to judge the authenticity of sales revenue.
(2) Inventory falling price reserves
Please refer to Note V, 12 and Note VII, 8 to the financial statement for details of the relevant information
disclosure.
1. Description of matters
As of December 31, 2021, the balance of inventory depreciation reserve of Shenzhen Textile is RMB 98.0359
million. As the inventory depreciation reserve and its changes have a significant influence on the financial
statements, the determination of the net realizable value of inventory involves the major judgment and estimation
of the management, so we identify the inventory depreciation reserve as a key audit item.
2. Response to the audit
The audit process implemented for inventory falling price reserves includes mainly:
(1) Understand, evaluate and test the design and operation effectiveness of internal control related to inventory
depreciation reserve;
(2) Understand and evaluate the appropriateness of the Company's accrual policy for inventory depreciation
reserve;
(3) Understand and inquire about inventory storage location and inventory accounting method, and determine
the scope of inventory supervision; Implement inventory supervision procedures to check whether the inventory is
damaged, obsolete, outdated, defective, etc.;
(4) Obtain the inventory year-end inventory age list, and carry out analytical review of inventory age
according to the status of products to analyze whether the inventory depreciation reserve is reasonable;
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2021 Annual Report
(5) Review and evaluate the rationality of the major estimates made by the management when determining
the net realizable value;
(6) Obtain the calculation table of inventory depreciation reserve, check whether the accrual of inventory
depreciation reserve is implemented according to relevant accounting policies, and recalculate the inventory
depreciation reserve; Check the changes of inventory depreciation accrued in previous years, evaluate the
rationality of estimated selling price and estimated related taxes and fees as key parameters of net realizable value,
review the sufficiency of basis of estimated selling price, and analyze the rationality of inventory depreciation
reserve.
IV. Other information
The management of the Company is responsible for the other information. The other information comprises
information of the Company's annual report in 2021, but excludes the financial statements and our auditor's report.
Our opinion on the financial statements does not cover the other information and we do not and will not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
identified above and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this
auditor's report, we conclude that there is a material misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard
V. Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Company's management is responsible for preparing the financial statements in accordance with the
requirements of Accounting Standards for Business Enterprises to achieve a fair presentation, and for designing,
implementing and maintaining internal control that is necessary to ensure that the financial statements are free
from material misstatements, whether due to frauds or errors.
In preparing the financial statements, management of the Company is responsible for assessing the Company's
ability to continue as a going concern, disclosing matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no
realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
VI. Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the audit standards will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
114
2021 Annual Report
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, omissions,
misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management of the Company.
(4) Conclude on the appropriateness of using the going concern assumption by the management of the Company,
and conclude, based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures
in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may
cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Company to express an opinion on the financial statements and bear all liability for the
opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit matters, including any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key audit
matters.
We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Grant Thornton International Ltd.(Special General Partnership)
Chinese C.P.A. Chen Zhifang
（Project Partner)
Beijing China Chinese C.P.A. Liu Duoqi
March 15, 2022
115
2021 Annual Report
II. Financial Statements
Statement in Financial Notes are carried in RMB/CNY
(1) Consolidated balance sheet
Prepared by: Shenzhen Textile (Holdings) Co., Ltd.
In RMB
Items December 31,2021 December 31,2020
Current asset：
Monetary fund 302,472,828.60 279,087,236.95
Settlement provision
Outgoing call loan
Transactional financial assets 586,540,735.16 684,617,260.06
Derivative financial assets
Note receivable 149,942,880.28 16,813,657.28
Account receivable 479,998,708.57 547,310,217.90
Financing of receivables 21,474,101.07 102,051,314.08
Prepayments 15,406,619.53 16,902,516.39
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts receivable
Other account receivable 140,185,750.40 5,265,002.71
Including：Interest receivable
Dividend receivable
Repurchasing of financial assets
Inventories 667,461,447.03 480,847,581.44
Contract assets
Assets held for sales
Non-current asset due within 1 year
Other current asset 29,503,352.42 77,482,083.47
Total of current assets 2,392,986,423.06 2,210,376,870.28
Non-current assets：
Loans and payment on other’s behalf disbursed
Creditor's right investment
Other creditor's right investment
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2021 Annual Report
Long-term receivable
Long term share equity investment 133,022,325.77 147,929,137.23
Other equity instruments investment 186,033,829.72 190,607,427.54
Other non-current financial assets 30,650,943.40 30,650,943.40
Real estate investment 106,217,779.76 110,572,471.92
Fixed assets 2,424,741,252.86 790,183,905.38
Construction in progress 71,482,031.08 1,301,750,141.12
Production physical assets
Oil & gas assets
Use right assets 9,221,189.37
Intangible assets 48,635,160.00 36,048,978.91
Development expenses
Goodwill
Long-germ expenses to be amortized 5,387,295.94 2,876,561.53
Deferred income tax asset 3,708,596.78 5,243,425.26
Other non-current asset 84,560,280.09 143,307,689.66
Total of non-current assets 3,103,660,684.77 2,759,170,681.95
Total of assets 5,496,647,107.83 4,969,547,552.23
Current liabilities
Short-term loans 37,575,113.83
Loan from Central Bank
Borrowing funds
Transactional financial liabilities
Derivative financial liabilities
Notes payable 16,682,324.12
Account payable 283,643,842.23 329,468,601.90
Advance receipts 1,805,311.57 3,542,394.33
Contract liabilities 68,955.21 279,631.27
Selling of repurchased financial assets
Deposit taking and interbank deposit
Entrusted trading of securities
Entrusted selling of securities
Employees’ wage payable 59,719,860.24 55,642,549.53
Tax payable 9,200,627.09 12,198,522.02
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2021 Annual Report
Other account payable 201,317,421.35 156,118,440.42
Including：Interest payable
Dividend payable
Fees and commissions payable
Reinsurance fee payable
Liabilities held for sales
Non-current liability due within 1 year 5,175,393.52
Other current liability 27,523,903.58
Total of current liability 642,712,752.74 557,250,139.47
Non-current liabilities：
Reserve fund for insurance contracts
Long-term loan 683,016,243.25 343,100,174.35
Bond payable
Including：preferred stock
Sustainable debt
Lease liability 4,243,855.71
Long-term payable
Long-term remuneration payable to staff
Expected liabilities 30,741,055.00
Deferred income 110,461,293.15 110,740,322.21
Deferred income tax liability 61,642,660.91 59,141,666.58
Other non-current liabilities
Total non-current liabilities 890,105,108.02 512,982,163.14
Total of liability 1,532,817,860.76 1,070,232,302.61
Owners’ equity
Share capital 506,521,849.00 507,772,279.00
Other equity instruments
Including：preferred stock
Sustainable debt
Capital reserves 1,961,599,824.63 1,967,514,358.53
Less：Shares in stock 7,525,438.20
Other comprehensive income 119,682,119.05 116,605,932.42
Special reserve
Surplus reserves 98,245,845.47 94,954,652.14
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2021 Annual Report
Common risk provision
Retained profit 130,746,251.74 86,912,390.50
Total of owner’s equity belong to the parent
2,816,795,889.89 2,766,234,174.39
company
Minority shareholders’ equity 1,147,033,357.18 1,133,081,075.23
Total of owners’ equity 3,963,829,247.07 3,899,315,249.62
Total of liabilities and owners’ equity 5,496,647,107.83 4,969,547,552.23
Legal Representative: Zhang Jian
Person-in-charge of the accounting work：He Fei
Person-in -charge of the accounting organ：Zhu Jingjing
(2)Parent Company Balance Sheet
In RMB
Items December 31,2021 December 31,2020
Current asset：
Monetary fund 130,270,313.58 113,560,327.21
Transactional financial assets 586,540,735.16 514,277,000.82
Derivative financial assets
Note receivable
Account receivable 7,935,911.24 1,461,400.20
Financing of receivables
Prepayments 18,706.17
Other account receivable 14,383,631.68 7,450,934.40
Including：Interest receivable
Dividend receivable
Inventories 39,131.60 8,808.00
Contract assets
Assets held for sales
Non-current asset due within 1 year
Other current asset
Total of current assets 739,169,723.26 636,777,176.80
Non-current assets：
Creditor's right investment
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2021 Annual Report
Other creditor's right investment
Long-term receivable
Long term share equity investment 2,089,070,531.86 2,103,977,343.32
Other equity instruments investment 169,974,388.84 177,142,433.45
Other non-current financial assets
Real estate investment 98,174,132.57 101,644,481.93
Fixed assets 20,255,108.56 21,876,099.34
Construction in progress
Production physical assets
Oil & gas assets
Use right assets
Intangible assets 454,036.00 492,923.62
Development expenses
Goodwill
Long-germ expenses to be amortized
Deferred income tax asset 3,672,545.57 5,097,360.00
Other non-current asset 55,790,497.23 96,871,196.43
Total of non-current assets 2,437,391,240.63 2,507,101,838.09
Total of assets 3,176,560,963.89 3,143,879,014.89
Current liabilities
Short-term loans
Transactional financial liabilities
Derivative financial liabilities
Notes payable
Account payable 411,743.57 411,743.57
Advance receipts 639,024.58 2,875,936.58
Contract liabilities
Employees’ wage payable 16,712,946.96 14,824,723.81
Tax payable 1,943,470.48 11,497,591.21
Other account payable 116,648,650.39 95,023,378.12
Including：Interest payable
Dividend payable
Liabilities held for sales
Non-current liability due within 1 year
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Other current liability
Total of current liability 136,355,835.98 124,633,373.29
Non-current liabilities：
Long-term loan
Bond payable
Including：preferred stock
Sustainable debt
Lease liability
Long-term payable
Long-term remuneration payable to staff
Expected liabilities
Deferred income 400,000.00 500,000.00
Deferred income tax liability 58,002,800.69 56,150,418.06
Other non-current liabilities
Total non-current liabilities 58,402,800.69 56,650,418.06
Total of liability 194,758,636.67 181,283,791.35
Owners’ equity
Share capital 506,521,849.00 507,772,279.00
Other equity instruments
Including：preferred stock
Sustainable debt
Capital reserves 1,577,392,975.96 1,583,307,509.86
Less：Shares in stock 7,525,438.20
Other comprehensive income 108,762,538.39 107,632,186.85
Special reserve
Surplus reserves 98,245,845.47 94,954,652.14
Retained profit 690,879,118.40 676,454,033.89
Total of owners’ equity 2,981,802,327.22 2,962,595,223.54
Total of liabilities and owners’ equity 3,176,560,963.89 3,143,879,014.89
(3)Consolidated Income statement
In RMB
Items Year 2021 Year 2020
I. Income from the key business 2,293,747,892.06 2,108,964,687.80
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Incl：Business income 2,293,747,892.06 2,108,964,687.80
Interest income
Insurance fee earned
Fee and commission received
II. Total business cost 2,182,483,548.35 2,030,833,538.40
Incl：Business cost 1,908,519,413.28 1,814,298,395.02
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
Net amount of withdrawal of insurance contract reserve
Insurance policy dividend paid
Reinsurance expenses
Business tax and surcharge 10,523,548.09 7,347,125.65
Sales expense 37,973,336.39 28,644,230.87
Administrative expense 122,088,830.15 105,094,934.36
R & D costs 103,508,764.53 67,160,964.22
Financial expenses -130,344.09 8,287,888.28
Including：Interest expense 14,306,275.13 234,815.67
Interest income 1,655,853.59 3,702,735.59
Add: Other income 19,643,379.33 29,506,252.69
Investment gain（“-”for loss） 22,663,013.06 22,599,670.74
Incl: investment gains from affiliates 33,984.66 -3,446,613.86
Financial assets measured at amortized cost cease to be recognized as
income
Gains from currency exchange
Net exposure hedging income
Changing income of fair value 2,150,943.40 2,687,518.74
Credit impairment loss -4,981,560.53 -10,394,533.65
Impairment loss of assets -83,508,720.33 -72,412,477.63
Assets disposal income -597,458.77 276,544.73
III. Operational profit（“-”for loss） 66,633,939.87 50,394,125.02
Add ：Non-operational income 21,285,786.64 1,445,662.38
Less: Non-operating expense 1,686,263.35 138,421.27
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2021 Annual Report
IV. Total profit(“-”for loss) 86,233,463.16 51,701,366.13
Less：Income tax expenses 11,118,796.96 8,203,720.98
V. Net profit 75,114,666.20 43,497,645.15
(I) Classification by business continuity
1.Net continuing operating profit 75,114,666.20 43,497,645.15
2.Termination of operating net profit
(II) Classification by ownership
1.Net profit attributable to the owners of parent company 61,162,384.25 37,267,995.74
2.Minority shareholders’ equity 13,952,281.95 6,229,649.41
VI. Net after-tax of other comprehensive income 3,076,186.63 -3,131,850.89
Net of profit of other comprehensive income attributable to owners of the paren
3,076,186.63 -3,131,850.89
t company.
（I）Other comprehensive income items that will not be reclassified into
3,275,250.36 -2,815,824.67
gains/losses in the subsequent accounting period
1.Re-measurement of defined benefit plans of changes in net debt or net assets
2.Other comprehensive income under the equity method investee can not be rec
lassified into profit or loss.
3. Changes in the fair value of investments in other equity instruments 3,275,250.36 -2,815,824.67
4. Changes in the fair value of the company’s credit risks
5.Other
(II)Other comprehensive income that will be reclassified into profit or loss. -199,063.73 -316,026.22
1.Other comprehensive income under the equity method investee can be reclass
ified into profit or loss.
2. Changes in the fair value of investments in other debt obligations
3. Other comprehensive income arising from the reclassification of financial
assets
4.Allowance for credit impairments in investments in other debt obligations
5. Reserve for cash flow hedges
6.Translation differences in currency financial statements -199,063.73 -316,026.22
7.Other
Net of profit of other comprehensive income attributable to Minority
shareholders’ equity
VII. Total comprehensive income 78,190,852.83 40,365,794.26
Total comprehensive income attributable to the owner of the parent company 64,238,570.88 34,136,144.85
Total comprehensive income attributable minority shareholders 13,952,281.95 6,229,649.41
VIII. Earnings per share
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2021 Annual Report
（I）Basic earnings per share 0.12 0.07
(II)Diluted earnings per share 0.12 0.07
The current business combination under common control, the net profits of the combined party before achieved ne
t profit of RMB 0.00, last period the combined party realized RMB0.00.
Legal Representative: Zhang Jian
Person-in-charge of the accounting work：He Fei
Person-in -charge of the accounting organ：Zhu Jingjing
(4) Income statement of the Parent Company
In RMB
Items Year 2021 Year 2020
I. Income from the key business 78,159,686.19 61,296,888.21
Incl：Business cost 11,547,944.88 10,666,274.44
Business tax and surcharge 2,968,080.87 2,435,257.11
Sales expense 49,682.40
Administrative expense 45,821,418.49 38,680,586.21
R & D expense
Financial expenses 283,692.12 -1,020,628.37
Including：Interest expenses 645,507.87 13,780.96
Interest income 359,182.13 1,012,329.64
Add：Other income 602,709.52 117,006.72
Investment gain（“-”for loss） 20,409,098.48 35,656,479.65
Including: investment gains from affiliates 33,984.66 -3,446,613.86
Financial assets measured at amortized cost cease to be recognized as income
Net exposure hedging income
Changing income of fair value 392,767.12
Credit impairment loss -710,513.74 -799,858.92
Impairment loss of assets -32,769.22 -95,343.40
Assets disposal income -386,933.41 286,963.56
II. Operational profit（“-”for loss） 37,370,459.06 46,093,413.55
Add ：Non-operational income 283,354.84 562,910.99
Less：Non -operational expenses 27,244.40
III. Total profit(“-”for loss) 37,653,813.90 46,629,080.14
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2021 Annual Report
Less：Income tax expenses 5,900,206.38 7,746,152.13
IV. Net profit 31,753,607.52 38,882,928.01
1.Net continuing operating profit
2.Termination of operating net profit 31,753,607.52 38,882,928.01
V. Net after-tax of other comprehensive income 1,130,351.54 -3,131,850.89
（I）Other comprehensive income items that will not be reclassified into
1,329,415.27 -2,815,824.67
gains/losses in the subsequent accounting period
1.Re-measurement of defined benefit plans of changes in net debt or net assets
2.Other comprehensive income under the equity method investee can not be reclassi
fied into profit or loss.
3. Changes in the fair value of investments in other equity instruments 1,329,415.27 -2,815,824.67
4. Changes in the fair value of the company’s credit risks
5.Other
(II)Other comprehensive income that will be reclassified into profit or loss -199,063.73 -316,026.22
1.Other comprehensive income under the equity method investee can be reclassified
into profit or loss.
2. Changes in the fair value of investments in other debt obligations
3. Other comprehensive income arising from the reclassification of financial assets
4.Allowance for credit impairments in investments in other debt obligations
5. Reserve for cash flow hedges
6.Translation differences in currency financial statements -199,063.73 -316,026.22
7.Other
VI. Total comprehensive income 32,883,959.06 35,751,077.12
VII. Earnings per share
（I）Basic earnings per share 0 0
(II)Diluted earnings per share 0 0
(5) Consolidated Cash flow statement
In RMB
Items Year 2021 Year 2020
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 2,335,256,168.54 1,827,292,276.43
Net increase of customer deposits and capital kept for brother company
Net increase of loans from central bank
Net increase of inter-bank loans from other financial bodies
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Cash received against original insurance contract
Net cash received from reinsurance business
Net increase of client deposit and investment
Cash received from interest, commission charge and commission
Net increase of inter-bank fund received
Net increase of repurchasing business
Net cash received by agent in securities trading
Tax returned 9,423,408.29 116,428,895.93
Other cash received from business operation 88,625,329.53 123,408,000.43
Sub-total of cash inflow 2,433,304,906.36 2,067,129,172.79
Cash paid for purchasing of merchandise and services 1,860,349,920.78 1,742,576,211.51
Net increase of client trade and advance
Net increase of savings in central bank and brother company
Cash paid for original contract claim
Net increase in financial assets held for trading purposes
Net increase for Outgoing call loan
Cash paid for interest, processing fee and commission
Cash paid to staffs or paid for staffs 250,216,599.00 181,692,353.93
Taxes paid 101,786,653.96 43,712,017.07
Other cash paid for business activities 225,388,712.97 97,217,657.52
Sub-total of cash outflow from business activities 2,437,741,886.71 2,065,198,240.03
Net cash generated from /used in operating activities -4,436,980.35 1,930,932.76
II. Cash flow generated by investing
Cash received from investment retrieving 10,817,803.07 6,437,640.00
Cash received as investment gains 14,881,941.03 2,908,856.94
Net cash retrieved from disposal of fixed assets, intangible assets, and other
83,520.00 2,800,914.39
long-term assets
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received 1,128,309,484.61 3,240,861,003.37
Sub-total of cash inflow due to investment activities 1,154,092,748.71 3,253,008,414.70
Cash paid for construction of fixed assets, intangible assets and other long-term
447,622,193.08 564,014,103.94
assets
Cash paid as investment
Net increase of loan against pledge
Net cash received from subsidiaries and other operational units
126
2021 Annual Report
Other cash paid for investment activities 965,000,000.00 3,008,065,275.20
Sub-total of cash outflow due to investment activities 1,412,622,193.08 3,572,079,379.14
Net cash flow generated by investment -258,529,444.37 -319,070,964.44
III.Cash flow generated by financing
Cash received as investment
Including: Cash received as investment from minor shareholders
Cash received as loans 339,219,000.00 342,660,000.00
Other financing –related cash received
Sub-total of cash inflow from financing activities 339,219,000.00 342,660,000.00
Cash to repay debts
Cash paid as dividend, profit, or interests 38,306,691.13 3,511,622.58
Including: Dividend and profit paid by subsidiaries to minor shareholders
Other cash paid for financing activities 12,638,273.00 9,344,136.30
Sub-total of cash outflow due to financing activities 50,944,964.13 12,855,758.88
Net cash flow generated by financing 288,274,035.87 329,804,241.12
IV. Influence of exchange rate alternation on cash and cash equivalents -1,236,414.38 -2,973,560.67
V.Net increase of cash and cash equivalents 24,071,196.77 9,690,648.77
Add: balance of cash and cash equivalents at the beginning of term 278,337,236.95 268,646,588.18
VI ..Balance of cash and cash equivalents at the end of term 302,408,433.72 278,337,236.95
(6) Cash Flow Statement of the Parent Company
In RMB
Items Year 2021 Year 2020
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 66,467,384.64 64,167,036.73
Tax returned
Other cash received from business operation 42,417,781.16 6,524,378.62
Sub-total of cash inflow 108,885,165.80 70,691,415.35
Cash paid for purchasing of merchandise and services 13,344,258.31 4,462,365.49
Cash paid to staffs or paid for staffs 34,360,990.56 27,619,751.65
Taxes paid 23,084,768.18 34,788,061.46
Other cash paid for business activities 10,293,028.68 8,944,859.88
Sub-total of cash outflow from business activities 81,083,045.73 75,815,038.48
Net cash generated from /used in operating activities 27,802,120.07 -5,123,623.13
127
2021 Annual Report
II. Cash flow generated by investing
Cash received from investment retrieving 10,817,803.07 6,437,640.00
Cash received as investment gains 11,479,752.94 1,957,306.47
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term
2,759,267.00
assets
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received 466,820,636.28 1,623,459,188.57
Sub-total of cash inflow due to investment activities 489,118,192.29 1,634,613,402.04
Cash paid for construction of fixed assets, intangible assets and other long-term assets 2,247,719.06 2,528,077.97
Cash paid as investment 3,555,968.96
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities 475,000,000.00 1,530,015,275.20
Sub-total of cash outflow due to investment activities 477,247,719.06 1,536,099,322.13
Net cash flow generated by investment 11,870,473.23 98,514,079.91
III. Cash flow generated by financing
Cash received as investment
Cash received as loans
Other financing –related ash received 6,545,900.00
Sub-total of cash inflow from financing activities 6,545,900.00
Cash to repay debts
Cash paid as dividend, profit, or interests 15,176,281.23 11,231.64
Other cash paid for financing activities 7,820,298.30 14,344,136.30
Sub-total of cash outflow due to financing activities 22,996,579.53 14,355,367.94
Net cash flow generated by financing -22,996,579.53 -7,809,467.94
IV. Influence of exchange rate alternation on cash and cash equivalents
V.Net increase of cash and cash equivalents 16,676,013.77 85,580,988.84
Add: balance of cash and cash equivalents at the beginning of term 113,560,327.21 27,979,338.37
VI ..Balance of cash and cash equivalents at the end of term 130,236,340.98 113,560,327.21
(7) Consolidated Statement on Change in Owners’ Equity
Amount in this period
In RMB
Year 2021
Owner’s equity Attributable to the Parent Company Min Tota
Items
Sha Other Equity Capi Less Othe Spec Surp Com Reta Othe Subt or l of
re instrument tal : r ializ lus mon ined r otal shar own
128
2021 Annual Report
Ca reser Shar Com ed reser risk profi ehol ers’
pita Pre Su ves es in preh reser ves prov t ders’ equit
l fer stai stoc ensi ve ision equit y
Ot
red na k ve y
her
sto ble Inco
ck de me
bt
507
1,96 116, 94,9 86,9 2,76 1,13 3,89
I .Balance at ,77 7,52
7,51 605, 54,6 12,3 6,23 3,08 9,31
the end of last 2,2 5,43
4,35 932. 52.1 90.5 4,17 1,07 5,24
year 79. 8.20
8.53 42 4 0 4.39 5.23 9.62
00
Add: Change
of
accounti
ng policy
Correcting of
previous
errors
Merger of
entities under
common
control
Other
507
II. Balance at 1,96 116, 94,9 86,9 2,76 1,13 3,89
,77 7,52
the beginning 7,51 605, 54,6 12,3 6,23 3,08 9,31
2,2 5,43
of current 4,35 932. 52.1 90.5 4,17 1,07 5,24
79. 8.20
year 8.53 42 4 0 4.39 5.23 9.62
00
-1,
-5,9 -7,5 43,8 50,5 13,9 64,5
III .Changed 250 3,07 3,29
14,5 25,4 33,8 61,7 52,2 13,9
in the current ,43 6,18 1,19
33.9 38.2 61.2 15.5 81.9 97.4
year 0.0 6.63 3.33
0 0 4 0 5 5
0
61,1 65,3 13,9 79,3
（1）Total 4,23
62,3 96,8 52,2 49,1
comprehensiv 4,51
84.2 96.6 81.9 78.6
e income 2.42
5 7 5 2
（II） -1, -5,9 -7,5 360, 360,
Investment or 250 14,5 25,4 474. 474.
decreasing of ,43 33.9 38.2 30 30
129
2021 Annual Report
capital by 0.0 0 0
owners 0
1．Ordinary S
hares invested
by sharehold
ers
2．Holders of
other equity i
nstruments in
vested capital
3．Amount of
shares paid
and accounted
as owners’
equity
-1,
-5,9 -7,5
250 360, 360,
14,5 25,4
4．Other ,43 474. 474.
33.9 38.2
0.0 30 30
0 0
0
-18, -15, -15,
3,17
（III）Profit 371, 195, 195,
5,36
allotment 016. 655. 655.
0.75
22 47 47
-3,1
1.Providing 3,17
75,3
of surplus 5,36
60.7
reserves 0.75
5
2.Providing
of common
risk
provisions
3．Allotment -15, -15, -15,
to the owners 195, 195, 195,
(or 655. 655. 655.
shareholders) 47 47 47
4．Other
(IV) Internal -1,1
115, 1,04
transferring of 58,3
832. 2,49
owners’ 25.7
58 3.21
equity 9
130
2021 Annual Report
1.
Capitalizing
of capital
reserves (or to
capital shares)
2.
Capitalizing
of surplus
reserves (or to
capital shares)
3．Making up
losses by
surplus
reserves.
4.Change
amount of
defined
benefit plans
that carry
forward
Retained
earnings
5．Other
comprehensiv -1,1
115, 1,04
e income 58,3
832. 2,49
carry-over 25.7
58 3.21
retained 9
earnings
6．Other
(V). Special
reserves
1. Provided
this year
2．Used this
term
（VI）Other
506
1,96 119, 98,2 130, 2,81 1,14 3,96
IV. Balance at ,52
1,59 682, 45,8 746, 6,79 7,03 3,82
the end of this 1,8
9,82 119. 45.4 251. 5,88 3,35 9,24
term 49.
4.63 05 7 74 9.89 7.18 7.07
00
131
2021 Annual Report
Amount in last year
In RMB
Year 2020
Owner’s equity Attributable to the Parent Company
Other Equity
Othe Mino
instrument Total
Less r r
Sha Spec Com of
Capi : Com Surp Reta share
Items Pr owne
re Su ializ mon
tal Shar preh lus ined Othe Subt holde
efe rs’
Ca sta ed risk
reser es in ensi reser profi r otal rs’
rre Oth equit
pita ina reser prov
ves stoc ve ves t equit
d er y
l ble ve ision
k Inco y
sto
de
ck me
bt
509
1,97 16,1 119, 90,5 49,3 2,72 1,126 3,854
I .Balance at ,33
4,92 39,0 737, 96,9 07,7 7,76 ,851, ,615,
the end of 8,4
2,24 03.4 783. 23.3 64.0 4,14 425.8 570.1
last year 29.
8.03 0 31 9 3 4.36 2 8
00
Add: Change
of
accounti
ng
policy
Correcting of
previous
errors
Merger of
entities under
common
control
Other
509
II.Balance at 1,97 16,1 119, 90,5 49,3 2,72 1,126 3,854
,33
the beginning 4,92 39,0 737, 96,9 07,7 7,76 ,851, ,615,
8,4
of current 2,24 03.4 783. 23.3 64.0 4,14 425.8 570.1
29.
year 8.03 0 31 9 3 4.36 2 8
00
-1, -7,4 -8,6 -3,1 37,6 38,4
III .Changed 4,35 6,229 44,69
566 07,8 13,5 31,8 04,6 70,0
in the current 7,72 ,649. 9,679
,15 89.5 65.2 50.8 26.4 30.0
year 8.75 41 .44
0.0 0 0 9 7 3
132
2021 Annual Report
0
37,2 38,8
（1）Total 1,56 6,229 45,06
67,9 30,5
comprehensi 2,50 ,649. 0,153
95.7 04.3
ve income 8.59 41 .74
4 3
（II） -1,
-7,4 -8,6
Investment or 566 -360 -360,
07,8 13,5
decreasing of ,15 ,474 474.3
89.5 65.2
capital by 0.0 .30 0
0 0
owners 0
1．Ordinary S
hares investe
d by sharehol
ders
2．Holders of
other equity i
nstruments in
vested capital
3．Amount of
shares paid
and
accounted as
owners’
equity
-1,
-7,4 -8,6
566 -360 -360,
07,8 13,5
4．Other ,15 ,474 474.3
89.5 65.2
0.0 .30 0
0 0
0
-3,8
3,88
（III）Profit 88,2
8,29
allotment 92.8
2.80
0
-3,8
1.Providing 3,88
88,2
of surplus 8,29
92.8
reserves 2.80
0
2.Providing
of common
risk
provisions
133
2021 Annual Report
3．Allotment
to the owners
(or
shareholders)
4．Other
(IV) Internal -4,6
469, 4,22
transferring 94,3
435. 4,92
of owners’ 59.4
95 3.53
equity 8
1.
Capitalizing
of capital
reserves (or
to capital
shares)
2.
Capitalizing
of surplus
reserves (or
to capital
shares)
3．Making up
losses by
surplus
reserves.
4.Change
amount of
defined
benefit plans
that carry
forward
Retained
earnings
5．Other
comprehensi -4,6
469, 4,22
ve income 94,3
435. 4,92
carry-over 59.4
95 3.53
retained 8
earnings
6．Other
(V). Special
134
2021 Annual Report
reserves
1. Provided
this year
2．Used this
term
（VI）Other
507
1,96 116, 94,9 86,9 2,76 1,133 3,899
IV. Balance ,77 7,52
7,51 605, 54,6 12,3 6,23 ,081, ,315,
at the end of 2,2 5,43
4,35 932. 52.1 90.5 4,17 075.2 249.6
this term 79. 8.20
8.53 42 4 0 4.39 3 2
00
(8)Statement of change in owner’s Equity of the Parent Company
Amount in this period
In RMB
Year 2021
Other Equity
instrument Other
Capita Less: Compr Specia Surplu Retai
Share Total of
Items l Shares ehensi lized s ned
capit Prefe Sust Other owners’
Othe reserv in ve reserv reserv profi
al rred aina equity
r es stock Incom e es t
stock ble
e
debt
676,
I.Balance at 507,7 1,583, 107,63 94,954
7,525, 454, 2,962,59
the end of last 72,27 307,50 2,186. ,652.1
438.20 033. 5,223.54
year 9.00 9.86 85 4
89
Add: Change
of
accountin
g policy
Correcting of
previous errors
Other
676,
II. Balance at 507,7 1,583, 107,63 94,954
7,525, 454, 2,962,59
the beginning 72,27 307,50 2,186. ,652.1
438.20 033. 5,223.54
of current year 9.00 9.86 85 4
89
III .Changed -1,25 -5,914, -7,525, 1,130, 3,291, 14,4 19,207,1
135
2021 Annual Report
in the current 0,430 533.90 438.20 351.54 193.33 25,0 03.68
year .00 84.5
1
31,7
（I）Total
2,288, 53,6 34,042,2
comprehensive
677.33 07.5 84.85
income
2
(II) Investment
-1,25
or decreasing -5,914, -7,525, 360,474.
0,430
of capital by 533.90 438.20 30
.00
owners
1．Ordinary Sh
ares invested b
y shareholders
2．Holders of o
ther equity inst
ruments invest
ed capital
3.Amount of
shares paid
and accounted
as owners’
equity
-1,25
-5,914, -7,525, 360,474.
4．Other 0,430
533.90 438.20 30
.00
-18,3
（III）Profit 3,175, 71,0 -15,195,
allotment 360.75 16.2 655.47
2
1.Providing of -3,17
3,175,
surplus 5,36
360.75
reserves 0.75
2．Allotment -15,1
to the owners 95,6 -15,195,
(or 55.4 655.47
shareholders) 7
3．Other
(IV) Internal 1,04
-1,158, 115,83
transferring of 2,49
325.79 2.58
owners’ equity 3.21
136
2021 Annual Report
1. Capitalizing
of capital
reserves (or to
capital shares)
2. Capitalizing
of surplus
reserves (or to
capital shares)
3．Making up
losses by
surplus
reserves.
4.Change
amount of
defined benefit
plans that
carry forward
Retained
earnings
5．Other
comprehensive
1,04
income -1,158, 115,83
2,49
carry-over 325.79 2.58
3.21
retained
earnings
6．Other
(V) Special
reserves
1. Provided
this year
2．Used this
term
（VI）Other
690,
IV. Balance at 506,5 1,577, 108,76 98,245
879,1 2,981,80
the end of this 21,84 392,97 2,538. ,845.4
18.4 2,327.22
term 9.00 5.96 39 7
0
Amount in last year
In RMB
Items Year 2020
137
2021 Annual Report
Other Equity
Other
instrument
Shar Capit Less: Comp Surpl
Pref Special Total of
e al Share rehen us Retaine
erre Sust ized Other owners’
Capi Othe reserv s in sive reserv d profit
d aina reserve equity
tal r es stock Incom es
stoc ble
e
k debt
509,
I.Balance at 1,589, 16,13 110,7 90,59 637,23
338, 2,921,66
the end of last 869,4 9,003. 64,03 6,923 4,475.1
429. 4,361.24
year 99.36 40 7.74 .39 5
00
Add: Change
of
accounti
ng
policy
Correcting of
previous
errors
Other
II. Balance at 509,
1,589, 16,13 110,7 90,59 637,23
the beginning 338, 2,921,66
869,4 9,003. 64,03 6,923 4,475.1
of current 429. 4,361.24
99.36 40 7.74 .39 5
year 00
III. Changed -1,56 -6,561 -8,613 -3,131 4,357
39,219, 40,930,8
in the current 6,15 ,989.5 ,565.2 ,850.8 ,728.
558.74 62.30
year 0.00 0 0 9 75
（I）Total 1,562,
38,882, 40,445,4
comprehensiv 508.5
928.01 36.60
e income 9
(II)
Investment or -1,56 -7,407 -8,613
-360,474.
decreasing of 6,15 ,889.5 ,565.2
30
capital by 0.00 0 0
owners
1．Ordinary S
hares investe
d by sharehol
ders
2．Holders of
other equity i
138
2021 Annual Report
nstruments in
vested capital
3.Amount of
shares paid
and
accounted as
owners’
equity
-1,56 -7,407 -8,613
-360,474.
4．Other 6,15 ,889.5 ,565.2
30
0.00 0 0
3,888
（III）Profit -3,888,
,292.
allotment 292.80
80
1.Providing 3,888
-3,888,
of surplus ,292.
292.80
reserves 80
2．Allotment
to the owners
(or
shareholders)
3．Other
(IV) Internal
-4,694
transferring 469,4 4,224,9
,359.4
of owners’ 35.95 23.53
8
equity
1.
Capitalizing
of capital
reserves (or
to capital
shares)
2.
Capitalizing
of surplus
reserves (or
to capital
shares)
3．Making up
losses by
surplus
139
2021 Annual Report
reserves.
4.Change
amount of
defined
benefit plans
that carry
forward
Retained
earnings
5．Other
comprehensiv
-4,694
e income 469,4 4,224,9
,359.4
carry-over 35.95 23.53
8
retained
earnings
6．Other
(V) Special
reserves
1. Provided
this year
2．Used this
term
845,9 845,900.
（VI）Other
00.00 00
507,
IV. Balance at 1,583, 7,525, 107,6 94,95 676,45
772, 2,962,59
the end of 307,5 438.2 32,18 4,652 4,033.8
279. 5,223.54
this term 09.86 0 6.85 .14 9
00
III. Basic Information of the Company
Shenzhen Textile (Group) Co., Ltd. (hereinafter referred to as "Company" or "the Company") is a joint-stock
company registered in Guangdong Province with a registered capital of RMB 506.521849 million and a unified
social credit code of 91440300192173749Y. The Company has publicly issued RMB common shares (A shares)
and domestic listed foreign shares (B shares) to the public at home and abroad, and listed and traded them. The
Company is headquartered address are 6/F,Shenfang Building, No.3 Huaqiang Road. North, Futian District,
Shenzhen.
The company was previously the Shenzhen Textile Industry Company, on April 13, 1994, approved by the
Letter(1994)No.15 issued by Shenzhen Municipal People's Government, the Company was restructured and
named as Shenzhen Textile (Group) Co., Ltd. ， As of December 31, 2021, the Company has issued a total of
506,521,849.00 shares.
The Company has established the corporate governance structure of General Meeting of Shareholders, Board of
Directors and Board of Supervisors, and currently has the Board Office, Office, Strategic Development
140
2021 Annual Report
Department, Operation and Management Department, Finance Department, Audit Department, Human Resources
Department and other departments.
the Company is mainly engaged in high-tech industry focusing on R&D, production and marketing of polarizers
for liquid crystal display, management of properties in bustling business districts of Shenzhen and reserved
high-class textile and garment business.
The financial statements have been authorized for issuance of the 11st meeting of the 8th Board of Directors of
the Group on March 15, 2022.
As of December 31, 2021, A total of 8 subsidiaries of the Company are included in the scope of consolidation. For
details, please refer to Section X Financial Report ,IX "Rights and Interests in Other Subjects".
IV.Basis for the preparation of financial statements
（1）Basis for the preparation
The financial statements are prepared in accordance with the Accounting Standards for Business Enterprises
promulgated by the Ministry of Finance and its application guidelines, interpretations and other relevant
provisions (collectively referred to as the "Accounting Standards for Business Enterprises"). In addition, the
Company also disclosed relevant financial information in accordance with the Rules No.15 for the Information
Disclosure and Compilation of Companies Offering Securities Public Issuance - General Provisions on Financial
Report (revised in 2014) issued by China Securities Regulatory Commission.
The accounting of the Company is based on accrual basis. Except for some financial instruments, the
financial statements are based on historical costs. In case of asset impairment, impairment provision shall be made
in accordance with relevant regulations.
(2)Continuation
This financial statement is presented on the basis of going concern.
V. Important accounting policies and estimations
Specific accounting policies and accounting estimates tips:
According to its own production and operation characteristics, the Company determines the policies of
depreciation of fixed assets, amortization of intangible assets and revenue recognition. See Note V. 16, ,Note V,19
and Note V. 26 for specific accounting policies.
1. Statement on complying with corporate accounting standards
This financial statement conforms to the requirements of Accounting Standards for Business Enterprises, and truly
and completely reflects the combination and financial status of the Company on December 31, 2021, as well as
the combination and operating results and cash flow of the Company.
2.Fiscal Year
The Company adopts the Gregorian calendar year commencing on January 1 and ending on December 31 as the
fiscal year.
3. Operating cycle
The operating cycle of the Company is 12 months.
4. Accounting standard money
The Company and its domestic subsidiaries use RMB as their bookkeeping base currency. The overseas
141
2021 Annual Report
subsidiaries of the Company determine RMB as their bookkeeping base currency according to the currency in the
main economic environment in which they operate. The currency used by the Company in preparing the financial
statements is RMB.
5. Accounting process method of enterprise consolidation under same and different controlling.
（1）Enterprise merger under same control：
For business combination under the same control, the assets and liabilities of the combined party acquired by
the merging party during the combination shall be measured according to the book value of the combined party in
the consolidated financial statements of the final controlling party on the combination date, except for the
adjustment due to different accounting policies. The difference between the book value of the combination
consideration and the book value of the net assets obtained in the combination adjusts the capital reserve. If the
capital reserve is insufficient to offset, the retained earnings will be adjusted.
Business combination under the same control shall be achieved step by step through multiple transactions
In individual financial statements, the share of the book value of the net assets of the combined party in the
consolidated financial statements of the ultimate controlling party shall be taken as the initial investment cost of
the investment on the combination day calculated by the shareholding ratio on the combination day; Adjust the
capital reserve for the difference between the initial investment cost and the book value of the investment held
before the combination plus the book value of the consideration paid on the new day of the combination. If the
capital reserve is insufficient to offset, adjust the retained earnings.
In the consolidated financial statements, the assets and liabilities of the combined party acquired by the
merging party in the combination shall be measured according to the book value in the consolidated financial
statements of the ultimate controlling party on the combination date, except for the adjustment due to different
accounting policies; The difference between the book value of the investment held before the combination plus the
book value of the consideration paid on the new day of the combination and the book value of the net assets
obtained during the combination will be adjusted for capital reserve. If the capital reserve is insufficient to offset,
the retained earnings will be adjusted. For the long-term equity investment held by the merging party before
obtaining the control right of the combined party, the relevant profits and losses, other comprehensive income and
other changes in owner's equity have been recognized from the date of obtaining the original equity and the date
when the merging party and the combined party are under the same final control to the combination date, and the
initial retained earnings or current profits and losses during the comparative report period shall be offset
respectively.
(2) Business combination involving entities not under common control
For business combination not under the same control, the combination cost refers to the assets paid, liabilities
incurred or assumed, and fair value of the issued equity securities in order to gain control over the acquiree on the
acquisition date. On the acquisition date, the acquired assets, liabilities and contingent liabilities of the acquiree
are recognized at fair value.
The difference between the combination cost and the fair value share of identifiable net assets acquired in the
combination is recognized as goodwill, and the accumulated impairment provision is deducted by cost for
subsequent measurement; The difference between the combination cost and the fair value share of identifiable net
assets acquired by the acquiree in the combination shall be recorded into the current profits and losses after
review.
Business combination under the same control shall be achieved step by step through multiple transactions
In individual financial statements, the sum of the book value of the equity investment held by the acquiree
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before the acquisition date and the new investment cost on the acquisition date is taken as the initial investment
cost of the investment. Other comprehensive income recognized by the equity investment held before the
acquisition date due to accounting by the equity method is not treated on the acquisition date, and accounting
treatment is carried out on the same basis as that of the investee's direct disposal of related assets or liabilities; The
owner's equity recognized due to the change of owner's equity of the investee except net profit and loss, other
comprehensive income and profit distribution shall be transferred to the current profit and loss during the disposal
period when the investment is disposed. If the equity investment held before the acquisition date is measured by
fair value, the accumulated changes in fair value originally included in other comprehensive income will be
transferred to the current profits and losses when accounting by cost method.
In the consolidated financial statements, the consolidated cost is the sum of the consideration paid on the
acquisition date and the fair value of the equity of the acquiree held before the acquisition date on the acquisition
date. The equity of the acquiree held before the acquisition date shall be re-measured according to the fair value of
the equity on the acquisition date, and the difference between the fair value and its book value shall be included in
the current income; Equity of the acquiree held before the acquisition date involves other comprehensive income,
and other changes in owner's equity are converted into current income on the acquisition date, except for other
comprehensive income arising from the remeasurement of net liabilities or changes in net assets of the set income
plan by the investee.
(3) Treatment of transaction costs in business combination
Intermediary expenses such as auditing, legal services, evaluation and consultation, and other related
management expenses incurred for business combination are included in the current profits and losses when they
occur. Transaction costs of equity securities or debt securities issued as combination consideration are included in
the initial recognition amount of equity securities or debt securities.
6 Compilation method of consolidated financial statements
(1)The scope of consolidation
The consolidation scope of consolidated financial statements is determined on the basis of control. Control refers
to that the company has the power over the investee, enjoys variable returns by participating in the related
activities of the investee, and has the ability to use the power over the investee to affect its return amount.
Subsidiaries refer to subjects controlled by the Company (including enterprises, divisible parts of investee,
structured subjects, etc.).
The consolidation scope of consolidated financial statements is determined on the basis of control. Control refers
to that the company has the power over the investee, enjoys variable returns by participating in the related
activities of the investee, and has the ability to use the power over the investee to affect its return amount.
Subsidiaries refer to subjects controlled by the Company (including enterprises, divisible parts of investee,
structured subjects, etc.).
(2) Compilation method of consolidated financial statements
The consolidated financial statements are based on the financial statements of the Company and its subsidiaries,
and are prepared by the Company according to other relevant information. When preparing the consolidated
financial statements, the accounting policies and accounting period requirements of the Company and its
subsidiaries are consistent, and major transactions and current balances between companies are offset.
During the reporting period, the subsidiaries and businesses increased due to the business combination under the
same control shall be deemed to be included in the consolidation scope of the Company from the date when they
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are controlled by the ultimate controller, and their operating results and cash flows from the date when they are
controlled by the ultimate controller shall be included in the consolidated income statement and the consolidated
cash flow statement respectively.
During the reporting period, the income, expenses and profits of subsidiaries and businesses increased from the
acquisition date to the end of the reporting period due to business combination not under the same control during
the reporting period are included in the consolidated income statement, and their cash flows are included in the
consolidated cash flow statement.
The part of shareholders' equity of subsidiaries that is not owned by the Company is listed separately as minority
shareholders' equity in the consolidated balance sheet; The share of minority shareholders' equity in the current net
profit and loss of subsidiaries is listed as "minority shareholders' profit and loss" under the net profit item in the
consolidated income statement. If the loss of subsidiary shared by minority shareholders exceeds the share
enjoyed by minority shareholders in the initial owner's equity of such subsidiary, the balance still offsets minority
shareholders' equity.
(3) Acquisition of minority shareholders' equity of subsidiaries
The capital reserve in the consolidated balance sheet shall be adjusted for the difference between the newly
acquired long-term equity investment cost due to the acquisition of minority shares and the share of net assets
continuously calculated by subsidiaries from the acquisition date or combination date, and the difference between
the disposal price obtained from partial disposal of equity investment in subsidiaries without losing control and
the share of net assets continuously calculated by subsidiaries from the acquisition date or combination date
corresponding to the disposal of long-term equity investment. If the capital reserve is insufficient to offset, the
retained earnings shall be adjusted.
(4) Treatment of losing control over subsidiaries
If the control over the original subsidiary is lost due to the disposal of part of the equity investment or other
reasons, the remaining equity shall be re-measured according to its fair value on the date of loss of control; The
sum of the consideration obtained from the disposal of equity and the fair value of remaining equity, minus the
sum of the share of the original subsidiary's book value of net assets calculated continuously from the acquisition
date and goodwill calculated according to the original shareholding ratio, and the difference formed is included in
the investment income of the current period of loss of control.
Other comprehensive income related to the original subsidiary's equity investment will be transferred to the
current profits and losses when the control right is lost, except for other comprehensive income generated by the
investee's remeasurement of the net liabilities or changes in net assets of the set income plan.
7.Joint venture arrangements classification and Co-operation accounting treatment
Joint venture arrangement refers to an arrangement under the joint control of two or more participants. The joint
venture arrangement of the Company is divided into joint operation and joint venture.
(1) Joint operation
Joint operation refers to the joint venture arrangement in which the Company is entitled to the assets related to
the arrangement and bears the liabilities related to the arrangement.
The Company recognizes the following items related to the share of interests in joint operation, and carries out
accounting treatment in accordance with the relevant accounting standards for business enterprises:
A. Recognize assets held separately and assets held jointly according to their shares;
B. Recognize the liabilities undertaken separately, and recognize the liabilities jointly undertaken according
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to their shares;
C. Recognize the income generated from the sale of its share of joint operating output;
D. Recognize the income generated by the sale of output from joint operation according to their shares;
E. Recognize the expenses incurred separately, and recognize the expenses incurred in joint operation
according to their shares.
(2) Joint venture
A joint venture refers to a joint venture arrangement in which the Company only has rights to the net assets
of the arrangement.
The Company shall carry out accounting treatment on the investment of the joint venture in accordance with
the provisions on accounting of long-term equity investment by the equity method.
8.Recognition Standard of Cash & Cash Equivalents
Cash refers to cash on hand and deposits that can be used for payment at any time. Cash equivalents refer to
investments held by the Company with short term, strong liquidity, easy conversion into known cash and little risk
of value change.
9.Foreign currency transaction
In case of foreign currency business of the Company, the exchange rate determined by a systematic and
reasonable method which is similar to the spot exchange rate on the transaction date shall be used to convert it
into the bookkeeping base currency amount.
Balance sheet date: foreign currency monetary items shall be converted at the spot exchange rate on the balance
sheet date. Exchange differences arising from the difference between the spot exchange rate on the balance sheet
date and the spot exchange rate at the time of initial recognition or the previous balance sheet date are included in
the current profits and losses; For foreign currency non-monetary items measured at historical cost, the spot
exchange rate on the transaction date is still adopted; Foreign currency non-monetary items measured at fair value
are converted at the spot exchange rate on the fair value determination date, and the difference between the
converted bookkeeping base currency amount and the original bookkeeping , According to the nature of
non-monetary items, it is included in current profits and losses or other comprehensive income.
10.Financial instruments
Financial instruments refer to contracts that form financial assets of one party and financial liabilities or equity
instruments of other parties.
(1) Recognition and derecognition of financial instruments
When the Company becomes a party to a financial instrument contract, a financial asset or financial liability
is recognized.
Financial assets that meet one of the following conditions shall be derecognized:
① Termination of the contractual right to receive cash flow from the financial asset;
② The financial asset has been transferred and the following conditions for derecognition of financial asset
transfer are met.
If all or part of the current obligations of a financial liability have been discharged, the financial liability or part of
it shall be derecognized. If the Company (debtor) signs an agreement with the creditor to replace the existing
financial liabilities by assuming new financial liabilities, and the contract terms of the new financial liabilities are
substantially different from those of the existing financial liabilities, the existing financial liabilities shall be
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derecognized and the new financial liabilities shall be recognized at the same time.
When trading the financial assets in a conventional way, accounting recognition and derecognition shall be
carried out according to the trading day.
(2) Classification and measurement of financial assets
According to the business model of managing financial assets and the contractual cash flow characteristics of
financial assets, the Company divides financial assets into the following three categories: financial assets
measured at amortized cost, financial assets measured at fair value with changes included in other comprehensive
income, and financial assets measured at fair value with changes included in current profits and losses.
Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions and are not designated to be
measured at fair value with changes included in current profits and losses as financial assets measured at
amortized cost:
The Company's business model of managing such financial assets is to collect contract cash flow as the goal;
According to the contract terms of the financial asset, the cash flow generated on a specific date is only the
payment of principal and interest based on the unpaid principal amount.
After initial recognition, such financial assets are measured in amortized cost by the effective interest rate
method. Gains or losses arising from financial assets measured in amortized cost that are not part of any
hedging relationship are included in current profits and losses when derecognition, amortization according to
the effective interest rate method, or impairment recognition.
Financial assets measured at fair value and changes included in other comprehensive income
The Company classifies financial assets that meet the following conditions and are not designated to be
measured at fair value with changes included in current profits and losses as financial assets measured at fair value
with changes included in other comprehensive income:
The company's business model of managing the financial assets aims at both collecting contract cash flow
and selling the financial assets;
According to the contract terms of the financial asset, the cash flow generated on a specific date is only the
payment of principal and interest based on the unpaid principal amount.
After initial recognition, the fair value of such financial assets is subsequently measured. Interest, impairment
losses or gains and exchange gains and losses calculated by the effective interest rate method are included in
the current profits and losses, while other gains or losses are included in other comprehensive income. Upon
termination of recognition, the accumulated gains or losses previously included in other comprehensive
income shall be transferred out of other comprehensive income and included in current profits and losses.
Financial assets measured at fair value with changes included in current profits and losses
Except for the above financial assets measured at amortized cost and at fair value with changes included in
other comprehensive income, the Company classifies all other financial assets as financial assets measured at fair
value with changes included in current profits and losses. At the time of initial recognition, in order to eliminate or
significantly reduce accounting mismatch, the Company irrevocably designated some financial assets that should
have been measured at amortized cost or at fair value with changes included in other comprehensive income as
financial assets measured at fair value with changes included in current profits and losses.
After initial recognition, the financial assets are subsequently measured at fair value, and the resulting gains or
losses (including interest and dividend income) are included in the current profits and losses, unless the financial
assets are part of the hedging relationship.
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However, for non-trading equity instrument investments, the Company can irrevocably designate them as
financial assets measured at fair value with changes included in other comprehensive income upon initial
recognition. The designation is made on the basis of a single investment, and the relevant investment conforms to
the definition of equity instruments from the perspective of the issuer.
After initial recognition, the fair value of such financial assets is subsequently measured. Dividend income that
meets the requirements is included in profit or loss, and other gains or losses and changes in fair value are
included in other comprehensive income. Upon termination of recognition, the accumulated gains or losses
previously included in other comprehensive income shall be transferred out of other comprehensive income and
included in retained income.
The business model of managing financial asset refers to how the Company manages financial assets to generate
cash flow. The business model determines whether the cash flow of financial assets managed by the Company
comes from contract cash flow, sale of financial assets or both. The Company determines the business model of
managing financial assets based on objective facts and specific business objectives of managing financial assets
decided by key management personnel.
The Company evaluates the contractual cash flow characteristics of financial assets to determine whether the
contractual cash flow generated by related financial assets on a specific date is only the payment of principal and
interest based on the unpaid principal amount. Where, the principal refers to the fair value of financial assets at
initial recognition; Interest includes consideration for the time value of money, credit risk related to the unpaid
principal amount in a specific period, and other basic borrowing risks, costs and profits. In addition, the Company
evaluates the contract clauses that may cause changes in the time distribution or amount of cash flow of financial
assets contracts to determine whether they meet the requirements of the above-mentioned contract cash flow
characteristics.
Only when the Company changes its business model for managing financial assets, all affected financial assets
shall be reclassified on the first day of the first reporting period after the business model changes, otherwise,
financial assets shall not be reclassified after initial recognition.
Financial assets are measured at fair value upon initial recognition. For financial assets measured at fair value,
whose changes are included in current profits and losses, relevant transaction costs are directly included in current
profits and losses; For other types of financial assets, relevant transaction costs are included in the initial
recognition amount. Accounts receivable arising from the sale of products or the provision of labor services that
do not include or take into account significant financing components are initially recognized by the Company in
accordance with the amount of consideration that the Company is expected to be entitled to receive.
(3) Classification and measurement of financial liabilities
At initial recognition, the financial liabilities of the Company are classified into: financial liabilities measured at
fair value with changes included in current profits and losses, and financial liabilities measured at amortized cost.
For financial liabilities that are not classified as measured at fair value with changes included in current profits
and losses, relevant transaction costs are included in their initial recognition amount.
Financial liabilities measured at fair value with changes included in the current profits and losses
Financial liabilities measured at fair value with changes included in current profits and losses include
transactional financial liabilities and financial liabilities designated at fair value at initial recognition with changes
included in current profits and losses. Such financial liabilities are subsequently measured according to fair value,
and the gains or losses caused by changes in fair value and dividends and interest expenses related to such
financial liabilities are included in current profits and losses.
.Financial liabilities measured in amortized cost
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Other financial liabilities are subsequently measured according to the amortized cost by the effective interest rate
method, and the gains or losses arising from derecognition or amortization are included in the current profits and
losses.
Distinction between financial liabilities and equity instruments
Financial liabilities refer to liabilities that meet one of the following conditions:
① Contract obligation to deliver cash or other financial assets to other parties.
② The contractual obligation to exchange financial assets or financial liabilities with other parties under
potential unfavorable conditions.
③ Non-derivative contracts that need to be settled or can be settled by the enterprise's own equity
instruments in the future, for which the enterprise will deliver a variable number of its own equity instruments
according to this contract.
④ Derivative contracts that need to be settled or can be settled by the enterprise's own equity instruments in
the future, except for derivative contracts that exchange a fixed amount of its own equity instruments for a fixed
amount of cash or other financial assets.
Equity instruments refer to contracts that can prove ownership of an enterprise's residual equity in assets after
deducting all liabilities.
If the Company can't unconditionally avoid delivering cash or other financial assets to fulfill a contractual
obligation, the contractual obligation meets the definition of financial liabilities.
If a financial instrument needs to be settled or can be settled by the Company's own equity instrument, it shall
be considered whether its own equity instrument used to settle the instrument is a substitute for cash or other
financial assets, or it is to enable the holder of such instrument to be entitled to the remaining equity in the assets
after all liabilities are deducted by the issuer. In the former case, the instrument is the financial liability of the
Company; In the latter case, the instrument is the equity instrument of the Company.
(4) Derivative financial instruments and embedded derivative instruments
Initially, it is measured at the fair value on the day when the derivative transaction contract is signed, and then
measured at its fair value. Derivative financial instruments with positive fair value are recognized as an asset,
while those with negative fair value are regarded as an liability. Any gains or losses arising from changes in fair
value that do not meet the requirements of hedge accounting are directly included in the current profits and losses.
For mixed instruments including embedded derivative, if the main contract is financial assets, the relevant
provisions of financial asset classification shall apply to the mixed instruments as a whole. If the main contract is
not a financial asset, and the mixed instrument is not measured at fair value with changes included in the current
profits and losses for accounting treatment, the embedded derivative is not closely related to the main contract in
terms of economic characteristics and risks, and has the same conditions as the embedded derivative, and if the
independent instrument meets the definition of derivative, the embedded derivative is split from the mixed
instrument and treated as a separate derivative financial instrument. If the embedded derivative cannot be
separately measured at the time of acquisition or on the subsequent balance sheet date, the mixed instruments as a
whole are designated as financial assets or financial liabilities measured at fair value with changes included in the
current profits and losses.
(5) Fair value of financial instruments
See Note III. 11 for the determination method of the fair value of financial assets and financial liabilities.
(6) Impairment of financial assets
Based on the expected credit loss, the Company will carry out impairment accounting treatment on the
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following items and recognize the loss reserve:
① Financial assets measured at amortized cost;
② Receivables and debt investments measured at fair value and included in other comprehensive income;
③ Lease receivables;
④ Financial guarantee contracts (except those which are measured at fair value with changes included in
current profits and losses, in which the transfer of financial assets does not meet the conditions for derecognition,
or those formed by continuing to involve the transferred financial assets).
Measurement of expected credit loss
Expected credit loss refers to the weighted average of the credit losses of financial instruments weighted by the
risk of default. Credit loss refers to the difference between the cash flow of all contracts discounted according to
the original real interest rate and the expected cash flow of all contracts receivable according to the contract, that
is, the present value of all cash shortages.
The Company takes into account reasonable and reliable information on historical events, current situation and
future economic situation forecasts, and uses the risk of default as the weight to calculate the probability weighted
amount of the present value of the difference between the cash flow receivable from the contract and the cash flow
expected to be received to recognize the expected credit loss.
The Company separately measures the expected credit losses of financial instruments at different stages. If the
credit risk of financial instruments has not increased significantly since the initial recognition, it is in the first
stage. The Company measures the loss reserve according to the expected credit loss in the next 12 months; If the
credit risk of a financial instrument has increased significantly since its initial recognition but no credit
impairment has occurred, it is in the second stage. The Company measures the loss reserve according to the
expected credit loss of the instrument throughout the duration; If a financial instrument has suffered credit
impairment since its initial recognition, it is in the third stage. The Company measures the loss reserve according
to the expected credit loss of the instrument throughout the duration.
For financial instruments with low credit risk on the balance sheet date, the Company assumes that their credit
risk has not increased significantly since the initial recognition, and measures the loss reserve according to the
expected credit loss in the next 12 months.
The expected credit loss in the whole duration refers to the expected credit loss caused by all possible default
events in the whole expected duration of financial instruments. The expected credit loss in the next 12 months
refers to the expected credit loss caused by the financial instrument default event that may occur within 12 months
after the balance sheet date (or within the expected duration if the expected duration of the financial instrument is
less than 12 months), which is a part of the expected credit loss in the whole duration.
When measuring the expected credit loss, the longest period that the Company needs to consider is the longest
contract period during which the enterprise is subject to credit risk (including the option to renew the contract).
For financial instruments in the first and second stages and with low credit risk, the Company calculates interest
income based on the book balance before deducting impairment provisions and the actual interest rate. For
financial instruments in the third stage, the interest income shall be calculated according to their book balance
minus the amortized cost after impairment provision and the actual interest rate.
For notes receivable and accounts receivable, regardless of whether there is significant financing component, the
Company always measures the loss reserve according to the amount equivalent to the expected credit loss in the
whole duration.
When a single financial asset cannot evaluate the expected credit loss information at a reasonable cost, the
Company divides the notes receivable and accounts receivable into portfolios according to the credit risk
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characteristics, calculates the expected credit loss on the basis of the combinations, and determines the
combination on the following basis:
A. Notes receivable
Notes receivable portfolio 1: bank acceptance bill
Notes receivable portfolio 2: commercial acceptance bill
B. Accounts receivable
Accounts receivable portfolio 1: polarizer sales receivable
Accounts receivable portfolio 2: textile and garment sales receivable
Accounts receivable portfolio 3: operating funds receivable from self-own property
Accounts receivable portfolio 4: other receivables
For notes receivable divided into portfolios, the Company refers to the historical credit loss experience, and
calculates the expected credit loss through the default risk exposure and the expected credit loss rate of the whole
duration based on the current situation and forecasts the future economic situation.
For accounts receivable divided into combinations, the Company refers to the historical credit loss experience,
combines the current situation with the forecast of future economic situation, compiles a comparison table of
aging/overdue days of accounts receivable and the expected credit loss rate for the whole duration, and calculates
the expected credit loss.
Other receivables
The Company classifies other receivables into several combinations according to the credit risk characteristics,
and calculates the expected credit losses based on the portfolios. The basis for determining the portfolio is as
follows:
Other receivables portfolio: aging portfolio
For other receivables classified as portfolios, the Company calculates the expected credit loss through the default
risk exposure and the expected credit loss rate in the next 12 months or the whole duration.
Debt investment and other debt investment
For creditor's rights investment and other creditor's rights investment, the Company calculates the expected
credit loss according to the nature of the investment, the counterparty and various types of risk exposure and
based on the expected credit loss rate in the next 12 months or the whole duration.
Evaluation of significant increase in credit risk
By comparing the risk of default of financial instruments on the balance sheet date with the risk of default on the
initial recognition date, the Company determines the relative change of default risk of financial instruments in the
expected duration, and evaluates whether the credit risk of financial instruments has increased significantly since
initial recognition.
When determining whether the credit risk has increased significantly since the initial recognition, the company
considers to obtain reasonable and reliable information without unnecessary extra costs or efforts, including
forward-looking information. Information considered by the Company includes:
The debtor fails to pay the principal and interest according to the expiration date of the contract;
Serious deterioration of external or internal credit rating (if any) of financial instruments that has occurred
or is expected;
Serious deterioration of the debtor's operating results that has occurred or is expected;
Changes in existing or expected technology, market, economic or legal environment, and significant adverse
effects on the debtor's repayment ability of the Company.
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According to the nature of financial instruments, the Company assesses whether credit risks have increased
significantly on the basis of individual financial instruments or financial instrument portfolios. When
evaluating on the basis of financial instrument portfolio, the Company can classify financial instruments
based on common credit risk characteristics, such as overdue information and credit risk rating.
Financial assets with credit impairment
On the balance sheet date, the Company evaluates whether the financial assets measured at amortized cost and the
creditor's rights investments measured at fair value with changes included in other comprehensive income have
suffered credit impairment. When one or more events that adversely affect the expected future cash flow of a
financial asset occur, the financial asset becomes a financial asset with credit impairment. Evidence of credit
impairment of financial assets includes the following observable information:
The issuer or debtor has major financial difficulties;
The debtor violates the contract, such as default or overdue payment of interest or principal;
The Company gives concessions that the debtor will not make under any other circumstances due to
economic or contractual considerations related to the debtor's financial difficulties;
The debtor is likely to go bankrupt or undergo other financial restructuring;
The financial difficulties of the issuer or debtor cause the active market of the financial assets to disappear.
Presentation of expected credit loss provision
In order to reflect the change of credit risk of financial instruments after initial recognition, the Company
re-measures the expected credit loss on each balance sheet date, and the resulting increase or reversal amount of
loss reserve shall be included in the current profits and losses as impairment losses or gains. For financial assets
measured in amortized cost, the loss reserve shall be offset against the book value of the financial assets listed in
the balance sheet; For creditor's rights investments measured at fair value with changes included in other
comprehensive income, the Company recognizes its loss reserve in other comprehensive income, which does not
offset the book value of the financial asset.
Cancel after verification
If the Company no longer reasonably expects the contract cash flow of financial assets to be fully or partially
recovered, it will directly write down the book balance of the financial assets. This write-down constitutes the
derecognition of related financial assets. It usually happens when the Company determines that the debtor has no
assets or income sources to generate enough cash flow to repay the amount to be written down. However,
according to the Company's procedures for recovering the due amount, the written-down financial assets may still
be affected by the implementation activities.
If the written-down financial assets are recovered later, they will be included in profits and losses of the current
recovery period as the reversal of impairment losses.
(7) Transfer of financial assets
Transfer of financial assets refers to the transfer or delivery of financial assets to another party (transferee)
other than the issuer of the financial assets.
If the company has transferred almost all risks and rewards in the ownership of the financial asset to the
transferee, the recognition of the financial asset shall be terminated; If almost all risks and rewards on the
ownership of a financial asset are retained, the financial asset shall not be derecognized.
If the Company has neither transferred nor retained almost all risks and rewards in the ownership of financial
assets, it shall be dealt with as follows: if the control of the financial assets is abandoned, the financial assets shall
be derecognized and the resulting assets and liabilities shall be recognized; If the control of the financial assets is
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not abandoned, the relevant financial assets shall be recognized according to the extent of their continued
involvement in the transferred financial assets, and the relevant liabilities shall be recognized accordingly.
(8) Offset of financial assets and financial liabilities
When the Company has the legal right to offset the recognized financial assets and financial liabilities, which
can be enforced at present, and the Company plans to settle by net amount or at the same time realize such
financial assets and pay off such financial liabilities, the financial assets and financial liabilities are listed in the
balance sheet with the amount after offset. In addition, financial assets and financial liabilities are listed separately
in the balance sheet and will not be offset against each other.
11. Notes receivable
For notes receivable and accounts receivable, regardless of whether there is significant financing component, the
Company always measures the loss reserve according to the amount equivalent to the expected credit loss in the
whole duration.
When a single financial asset cannot evaluate the expected credit loss information at a reasonable cost, the
Company divides the notes receivable and accounts receivable into portfolios according to the credit risk
characteristics, calculates the expected credit loss on the basis of the combinations, and determines the
combination on the following basis:
Notes receivable portfolio 1: bank acceptance bill
Notes receivable portfolio 2: commercial acceptance bill
For notes receivable divided into portfolios, the Company refers to the historical credit loss experience, and
calculates the expected credit loss through the default risk exposure and the expected credit loss rate of the whole
duration based on the current situation and forecasts the future economic situation.
12. Accounts receivable
For notes receivable and accounts receivable, regardless of whether there is significant financing component, the
Company always measures the loss reserve according to the amount equivalent to the expected credit loss in the
whole duration.
When a single financial asset cannot evaluate the expected credit loss information at a reasonable cost, the
Company divides the notes receivable and accounts receivable into portfolios according to the credit risk
characteristics, calculates the expected credit loss on the basis of the combinations, and determines the
combination on the following basis:
Accounts receivable portfolio 1: polarizer sales receivable
Accounts receivable portfolio 2: textile and garment sales receivable
Accounts receivable portfolio 3: operating funds receivable from self-own property
Accounts receivable portfolio 4: other receivables
For accounts receivable divided into combinations, the Company refers to the historical credit loss experience,
combines the current situation with the forecast of future economic situation, compiles a comparison table of
aging/overdue days of accounts receivable and the expected credit loss rate for the whole duration, and calculates
the expected credit loss.
13. Receivable financing
For bills receivable and accounts receivable classified as those measured at fair value and whose changes are
included in other comprehensive income, the portion with self-financing period within one year (including one
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year) is listed as receivables financing; If the period of self-acceptance is more than one year, it shall be listed as
other creditor's rights investment. For relevant accounting policies, please refer to Note V, (10) "Financial
Instruments" and Note V, (10) "Impairment of Financial instruments ".
14.Other account receivable
Determination method and accounting treatment method of expected credit loss of other receivables
The Company divides the other receivables into several portfolio according to the credit risk characteristics, and
calculates the expected credit losses on the basis of determining the portfolio as follows:
Other receivables portfolio: age portfolio:
For accounts receivable divided into combinations, the Company refers to the historical credit loss experience,
combines the current situation with the forecast of future economic situation, compiles a comparison table of
aging/overdue days of accounts receivable and the expected credit loss rate for the whole duration, and calculates
the expected credit loss.
15.Inventory
1.Investories class
The Company's inventory includes raw materials, in-process products, low-value consumables, packaging
materials, inventory goods, and issued goods.
(2) Pricing method of issued inventory
The Company's inventory is priced at the actual cost when it is acquired. The weighted average method is
adopted when raw materials and inventory goods are issued.
(3) Determination basis of net realizable value of inventory and accrual method of inventory depreciation
reserve
The net realizable value of inventory is the estimated selling price of inventory minus the estimated costs to be
incurred upon completion, estimated sales expenses and related taxes. For determination of the net realizable
value of inventories, the solid evidence shall serve as the basis, and the purpose of holding inventories and the
influence of events after the balance sheet date shall be considered.
On the balance sheet date, if the inventory cost is higher than its net realizable value, inventory depreciation
reserve shall be made. The Company usually accrues the inventory depreciation reserve according to individual
inventory items. On the balance sheet date, if the influencing factors of previous inventory value written down
have disappeared, the inventory depreciation reserve will be returned within the originally accrued amount.
(4) Inventory system of inventory
Perpetual inventory system is adopted for the Company's inventory system.
(5) Amortization method of low-value consumables and packaging materials
Low-value consumables and packaging materials of the Company are amortized by one-time write-off
method.
16.Contract assets
The Company lists the customer's unpaid contract consideration for which the Company has fulfilled its
performance obligations according to the contract, and which is not the right to collect money from customers
unconditionally (that is, only depending on the passage of time) as a contract asset in the balance sheet. Contract
assets and liabilities under the same contract are listed in net amount, while contract assets and liabilities under
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different contracts are not offset.
17.Contract Costs
Contract costs include incremental costs incurred for obtaining contracts and contract performance costs.
The incremental cost incurred for obtaining the contract refers to the cost that the Company will not incur
without obtaining the contract (such as sales commission, etc.). If the cost is expected to be recovered, the
Company will recognize it as the contract acquisition cost as an asset. Other expenses incurred by the Company to
obtain the contract except the incremental cost expected to be recovered are included in the current profits and
losses when incurred.
If the cost incurred for the performance of the contract does not fall within the scope of other accounting
standards for enterprises such as inventory and meets the following conditions at the same time, the Company will
recognize it as the contract performance cost as an asset:
① Such cost is directly related to a current or expected contract, including direct labor, direct materials,
manufacturing expenses (or similar expenses), costs clearly borne by the customer, and other costs incurred only
due to this contract;
② Such cost increases the resources of the Company for fulfilling its performance obligations in the future;
③ The cost is expected to be recovered.
Assets recognized by contract acquisition cost and assets recognized by contract performance cost (hereinafter
referred to as "Assets Related to Contract Cost") shall be amortized on the same basis as the revenue recognition
of goods or services related to the assets, and shall be included in current profits and losses.
When the book value of the assets related to the contract cost is higher than the difference between the
following two items, the Company will accrue impairment provision of the excess and recognize it as the asset
impairment loss:
① The remaining consideration expected to be obtained by the Company due to the transfer of goods or
services related to the asset;
② The estimated cost to be incurred for transferring the related goods or services.
The contract performance cost recognized as an asset shall be amortized for no more than one year or one
normal business cycle at the time of initial recognition, which shall be listed in "Inventory", and the amortization
period for more than one year or one normal business cycle at the time of initial recognition shall be listed in
"Other Non-current Assets".
The contract acquisition cost recognized as an asset shall be amortized for no more than one year or one
normal business cycle at initial recognition, and shall be listed in "Other Current Assets". The amortization period
for initial recognition shall exceed one year or one normal business cycle, and shall be listed in "Other
Non-current Assets".
18.Held-for-sale assets
(1) Classification and measurement of non-current assets or disposal groups held for sale
When the book value of a non-current asset or disposal group is recovered by the Company mainly by selling
it (including the exchange of non-monetary assets with commercial nation) rather than continuously using it, the
non-current asset or disposal group is classified as held for sale.
The above-mentioned non-current assets do not include investment real estate measured by fair value model,
biological assets measured by net amount of fair value minus selling expenses, assets formed by employee
compensation, financial assets, deferred income tax assets and rights arising from insurance contracts.
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The disposal group refers to a group of assets disposed of together by sale or other means in a transaction as
a whole, and liabilities directly related to these assets transferred in the transaction. Under certain circumstances,
the disposal group includes goodwill obtained in business combination, etc.
Meanwhile, non-current assets or disposal groups that meet the following conditions are classified as
held-for-sale: according to the practice of selling such assets or disposal groups in similar transactions, the
non-current assets or disposal groups can be sold immediately under the current situation; The sale is very likely
to happen, that is, a resolution has been made on a sale plan and a certain purchase commitment has been obtained,
and it is expected that the sale will be completed within one year. If the control over subsidiaries is lost due to the
sale of investments in subsidiaries, whether or not the Company retains part of the equity investments after the
sale, when the investment in subsidiaries to be sold meets the classification conditions of holding for sale, the
investment in subsidiaries will be classified as held-for-sale as a whole in individual financial statements, and all
assets and liabilities of subsidiaries will be classified as held-for-sale in consolidated financial statements.
When the non-current assets or disposal groups held for sale are initially measured or re-measured on the
balance sheet date, the difference between the book value and the net amount after deduction of the sales expenses
from the fair value is recognized as the asset impairment loss. For the amount of asset impairment loss recognized
by the disposal group held for sale, the book value of goodwill in the disposal group is offset first, and then the
book value of non-current assets in the disposal group is offset proportionally.
If the net amount of non-current assets held for sale or disposal group's fair value minus sales expenses
increases on the subsequent balance sheet date, the previously written-down amount will be restored and reversed
within the amount of asset impairment loss recognized after being classified as held-for-sale, and the reversed
amount will be included in the current profits and losses. The book value of offset goodwill shall not be reversed.
Non-current assets held for sale and assets in disposal group held for sale are not depreciated or amortized;
Interest and other expenses of liabilities in disposal group held for sale continue to be recognized. All or part of
the investments of associated enterprises or joint ventures classified as held for sale shall be accounted for by the
equity method for those classified as held for sale, while those retained (not classified as held for sale) shall
continue to be accounted for by the equity method; When the Company loses significant influence on the
associated enterprises and joint ventures due to the sale, it shall stop using the equity method.
If a certain non-current asset or disposal group is classified as held-for-sale, but the classification conditions
of held-for-sale are no longer met, the Company will stop classifying it as held-for-sale and measure it according
to the lower of the following two amounts:
① The book value of the asset or disposal group before it is classified as held-for-sale, and the amount
adjusted according to the depreciation, amortization or impairment that should have been recognized without
being classified as held-for-sale;
② Recoverable amount.
19.Creditor's rights investment
Creditor's rights investment mainly accounts for bond investment measured by amortized cost, etc. The
Company has measured the impairment loss based on the amount of expected credit losses in the next 12 months
or the entire duration, based on whether the credit risk has increased significantly since the initial recognition.
20.Other Creditor's rights investment
For creditor's rights investment and other creditor's rights investment, the Company calculates the expected
credit loss according to the nature of the investment, the counterparty and various types of risk exposure and
based on the expected credit loss rate in the next 12 months or the whole duration.
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21.Long-term account receivable
None
22.Long-term equity investments
Long-term equity investment includes equity investment in subsidiaries, joint ventures and associated
enterprises. If the Company can exert significant influence on the investee, it is an associated enterprise of the
Company.
(1) Determination of initial investment cost
Long-term equity investment forming business combination: the long-term equity investment obtained by
business combination under the same control shall be taken as the investment cost according to the book value
share of the owner's equity of the combined party in the consolidated financial statements of the final controlling
party on the combination date; Long-term equity investment obtained by business combination not under the same
control shall be regarded as the investment cost of long-term equity investment according to the combination cost.
For long-term equity investment obtained by other means: For long-term equity investment obtained by
payment in cash, the actual purchase price is taken as the initial investment cost; For long-term equity investment
obtained by issuing equity securities, the fair value of issuing equity securities is taken as the initial investment
cost.
(2) Subsequent measurement and profit and loss recognition method
Investment in subsidiaries shall be accounted by cost method, unless the investment meets the conditions of
holding for sale; Investment in associated enterprises and joint ventures shall be accounted for by equity method.
For the long-term equity investment calculated by the cost method, except for the cash dividends or profits
that have been declared but not yet issued and that included in the actual payment or consideration, the cash
dividends or profits declared and distributed by the investee are recognized as investment income and included in
the current profits and losses.
If the initial investment cost of long-term equity investment accounted by equity method is greater than the
fair value share of identifiable net assets of the investee, the investment cost of long-term equity investment shall
not be adjusted; If the initial investment cost is less than the fair value share of the identifiable net assets of the
investee at the time of investment, the book value of the long-term equity investment shall be adjusted, and the
difference shall be included in the profit and loss of the current investment period.
In case of accounting by equity method, the investment income and other comprehensive income are
recognized respectively according to the share of net profits and losses and other comprehensive income realized
by the investee, and the book value of long-term equity investment is adjusted at the same time; According to the
profit or cash dividend declared and distributed by the investee, the part to be entitled to shall be calculated, and
the book value of long-term equity investment shall be reduced correspondingly; The investee adjusts the book
value of long-term equity investment for other changes in owner's equity except net profits and losses, other
comprehensive income and profit distribution and includes them in capital reserve (other capital reserve). When
recognizing the share of the net profit and loss of the investee, the fair value of identifiable assets of the investee
at the time of investment is taken as the basis, and the net profit of the investee is recognized after adjustment
according to the accounting policies and accounting periods of the Company.
If it can exert significant influence on the investee due to additional investment or implement joint control
but does not constitute control, on the conversion date, the sum of the fair value of the original equity plus the new
investment cost shall be taken as the initial investment cost calculated by the equity method instead. The
difference between the fair value and book value of the original equity on the conversion date, as well as the
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accumulated fair value changes originally included in other comprehensive income, are transferred to the current
profits and losses accounted for by the equity method.
If the joint control or significant influence on the investee is lost due to the disposal of some equity
investments, the remaining equity after disposal shall be accounted for according to Accounting Standards for
Business Enterprises No.22-Recognition and Measurement of Financial Instruments on the date of loss of joint
control or significant influence, and the difference between fair value and book value shall be included in the
current profits and losses. Other comprehensive income recognized by the original equity investment due to the
adoption of the equity method shall be accounted for on the same basis as the direct disposal of related assets or
liabilities by the investee when the equity method is terminated; Changes in other owners' equity related to the
original equity investment are transferred into current profits and losses.
If the control over the investee is lost due to the disposal of part of equity investment, and the remaining
equity after disposal can jointly control or exert significant influence on the investee, it shall be accounted for
according to the equity method instead, and the remaining equity shall be regarded as being adjusted by the equity
method when it is acquired; If the remaining equity after disposal cannot exercise joint control or exert significant
influence on the investee, it shall be accounted for according to the relevant provisions of Accounting Standards
for Business Enterprises No.22-Recognition and Measurement of Financial Instruments, and the difference
between its fair value and book value on the date of loss of control shall be included in the current profits and
losses.
If the Company's shareholding ratio decreases due to capital increase of other investors, causing loss of
control, but it can exercise joint control or exert significant influence on the investee, the share of net assets
increased by the investee due to capital increase and share expansion shall be recognized according to the new
shareholding ratio, and the difference between the original book value of long-term equity investment
corresponding to the decreased shareholding ratio shall be included in the current profits and losses; Then,
according to the new shareholding ratio, it is regarded as being adjusted by the equity method when the
investment is obtained.
For unrealized internal transaction gains and losses between the Company and its associated enterprises and
joint ventures, the portion attributable to the Company shall be calculated according to the shareholding ratio, and
investment gains and losses shall be recognized on the basis of offset. However, if the unrealized internal
transaction losses between the Company and the investee are the impairment losses of the transferred assets, they
will not be offset.
(3) Basis for determination of joint control and significant influence on the investee
Joint control refers to the common control of an arrangement in accordance with the relevant agreement, and
the relevant activities of such arrangement must be unanimously agreed by the participants who share the control
rights before any decision is made. When judging whether there is common control, firstly, judge whether all
participants or a combination of participants collectively control the arrangement, and secondly, judge whether the
decision-making of activities related to the arrangement must be unanimously agreed by the participants who
collectively control the arrangement. If all participants or a group of participants must act in concert to decide the
relevant activities of an arrangement, it is considered that all participants or a group of participants collectively
control the arrangement; If two or more participants can collectively control an arrangement, it does not constitute
joint control. When judging whether it is joint control, the protective rights entitled to are not considered.
Significant influence means that the investor has the right to participate in the decision-making on the
financial and operating policies of the investee, but cannot control or jointly control the formulation of these
policies with other parties. When determining whether it can exert significant influence on the investee, the
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influence of the voting shares of the investee directly or indirectly held by the investor and the current executable
potential voting rights held by the investor and other parties shall be considered, including the influence of the
current convertible warrants, share options and convertible corporate bonds issued by the investee.
When the Company directly or indirectly owns more than 20% (including 20%) but less than 50% of the
voting shares of the investee, it is generally considered to have a significant influence on the investee, unless there
is clear evidence that it cannot participate in the production and operation decisions of the investee under such
circumstances, in which case it does not have a significant influence; When the Company owns less than 20%
(excluding) of the voting shares of the investee, it is generally not considered to have a significant influence on the
investee, unless there is clear evidence that it can participate in the production and operation decisions of the
investee under such circumstances, in which case it has a significant influence.
(4) Equity investment held for sale
If all or part of the equity investment in an associated enterprise or joint venture is classified as assets held
for sale, please refer to Note III. 13 for relevant accounting treatment.
For the remaining equity investments that are not classified as assets held for sale, the equity method is
adopted for accounting treatment.
If the equity investment in an associated enterprise or joint venture that has been classified as held for sale no
longer meets the classification conditions of assets held for sale, the equity method shall be used for retrospective
adjustment from the date that it is classified as assets held for sale.
(5) Test method for impairment and accrual method for impairment provision
For investment in subsidiaries, associated enterprises and joint ventures, please refer to Note III. 21 for the
accrual method for impairment provision.
23.Investment real estate
The measurement mode of investment property
The company shall adopt the cost mode to measure the investment property.
Depreciation or Amortization Method
Investment real estate refers to real estate held for rent or capital appreciation, or both. The Company's
investment real estate includes leased land use rights, land use rights transferred after holding and preparing for
appreciation, and leased buildings.
The Company's investment real estate is initially measured according to the cost at the time of acquisition,
and depreciation or amortization is accrued on schedule according to the relevant provisions of fixed assets or
intangible assets.
For investment real estate that is subsequently measured by cost model, please refer to Note III. 21 for the
accrual method of asset impairment.
The difference between the disposal income from the sale, transfer, scrapping or damage of investment real
estate after deduction of its book value and related taxes shall be included in the current profits and losses.
24.Fixed assets
(1) Recognition conditions of fixed assets
The Company's fixed assets refer to tangible assets held for the production of commodities, provision of labor services, leasing or
operation and management, with a service life exceeding one fiscal year.
Only when the economic benefits related to the fixed assets are likely to flow into the enterprise and the cost of the fixed assets can
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be measured reliably, can the fixed assets be recognized.
The fixed assets of the Company are initially measured according to the actual cost at the time of acquisition.
Subsequent expenditures related to fixed assets are included in the cost of fixed assets when the economic benefits related to them are
likely to flow into the Company and the cost can be measured reliably; Daily repair expenses of fixed assets that do not meet the
requirements for subsequent expenditures of capitalization of fixed assets are included in the current profits and losses or the cost of
related assets according to the beneficiaries when they occur. For the replaced part, the book value is derecognized.
(2) The method for depreciation
The method for Expected useful life Estimated residual
Category Depreciation
depreciation （Year） value
House and Straight-line method
Building- 35 4.00% 2.74%
Production
House and Straight-line method
Building-Non- 40 4.00% 2.40%
Production
Decoration of Straight-line method
10 10.00%
Fixed assets
Machinery and Straight-line method
10-14 4.00% 9.60%-6.86%
equipment
Transportation Straight-line method
8 4.00% 12.00%
equipment
Electronic equipment Straight-line method 8 4.00% 12.00%
Other equipment Straight-line method 8 4.00% 12.00%
For the fixed assets with the impairment provision withdrawn, the accumulative amount of the withdrawn
fixed assets impairment provision shall be also deducted to calculate and determine the rate of depreciation.
（3） Identification basis, valuation method and depreciation method of fixed assets leased by financing
None
25.Construction in progress
The cost of construction in progress of the Company is determined according to the actual project
expenditure, including all necessary project expenditures incurred during the construction period, borrowing costs
that should be capitalized before the project reaches the intended usable state, and other related expenses.
Construction in progress is transferred to fixed assets when it reaches the scheduled usable state.
See Note III. 21 for the method of depreciation of assets in construction in progress.
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26.Borrowing costs
(1) Recognition principle of capitalization of borrowing costs
If the borrowing costs incurred by the Company can be directly attributed to the purchase, construction or
production of assets that meet the capitalization conditions, they will be capitalized and included in the relevant
asset costs; Other borrowing costs, when incurred, are recognized as expenses according to the amount incurred,
and included in current profits and losses. Borrowing costs shall be capitalized if they meet the following
conditions at the same time:
① Asset expenditure has already occurred, including the expenditure incurred in the form of payment in cash,
transfer of non-cash assets or assumption of interest-bearing debts for the purchase, construction or production of
assets that meet the capitalization conditions;
② Borrowing costs have already occurred;
③ The purchase, construction or production activities necessary to make the assets reach the intended usable
or saleable state have started.
(2) Capitalization period of borrowing costs
Capitalization of borrowing costs shall be stopped when assets eligible for capitalization acquired,
constructed or produced by the Company reach the intended usable or saleable state. Borrowing costs incurred
after the assets in line with the capitalization conditions reach the intended usable or saleable state shall be
recognized as expenses according to the amount incurred when they occur, and shall be included in current profits
and losses.
If the assets that meet the capitalization conditions are abnormally interrupted in the process of purchase,
construction or production, and the interruption lasts exceeds 3 months, the capitalization of borrowing costs shall
be suspended; Borrowing costs during normal interruption period continue to be capitalized.
(3) Capitalization rate of borrowing costs and calculation method of capitalization amount
The interest expenses actually incurred in the current period of special borrowing shall be capitalized after
deducting the interest income from the unused borrowing funds deposited in the bank or the investment income
from temporary investment; The capitalization amount of general borrowings is determined by multiplying the
weighted average of the accumulated asset expenditure over the special loan by the capitalization rate of the
occupied general borrowings. Capitalization rate is calculated and determined according to the weighted average
interest rate of general borrowings.
During the capitalization period, all the exchange differences of special borrowings in foreign currency are
capitalized; Exchange differences of general borrowings in foreign currency are included in current profits and
losses.
27.Biological Assets
None
28.Oil & Gas assets
None
29. Right to use assets
(1) Conditions for recognizing the right-to-use assets
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The Company's right-to-use assets refers to the right of the Company as the lessee to use the leased assets during
the lease term.
On the start date of the lease term, the right-to-use assets is initially measured at cost. The cost includes: the initial
measurement amount of lease liabilities; The lease payment amount issued on or before the start date of the lease
term, where if there is a lease incentive, the amount related to the entitled lease incentive shall be deducted; The
initial direct expenses incurred by the Company as the lessee; The cost expected to be incurred by the Company as
the lessee to dismantle and remove the leased assets, restore the site where the leased assets are located or restore
the leased assets to the state agreed in the lease terms. The Company, as the lessee, recognizes and measures the
demolition and restoration costs in accordance with the Accounting Standards for Business Enterprises
No.13-Contingencies. Subsequent adjustments shall be made to any remeasurement of lease liabilities.
(2) Depreciation method of right-to-use assets
The Company adopts the straight-line method to accrue depreciation. If the Company, as the lessee, can
reasonably determine that the ownership of the leased assets is acquired at the expiration of the lease term,
depreciation shall be accrued within the remaining service life of the leased assets. If it cannot be reasonably
determined that the ownership of the leased assets can be obtained at the expiration of the lease term, depreciation
shall be accrued during the lease term or the remaining service life of the leased assets, whichever is shorter.
See Note V. 21 for the impairment test method of the right-to-use assets and the provision method for impairment.
30.Intangible assets
(1) Valuation method, service life and impairment test
The intangible assets of the Company include land use rights, proprietary technology and software.
Intangible assets are initially measured at cost, and their service life is analyzed and judged when they are
acquired. If the service life is limited, the intangible assets shall be amortized within the expected service life by
the amortization method that can reflect the expected realization mode of the economic benefits related to the
assets from the time when they are available for use; If it is impossible to reliably determine the expected
realization mode, they shall be amortized by straight-line method; Intangible asset\s with uncertain service life are
not amortized.
Amortization methods of intangible assets with limited service life are as follows:
Items Useful life（year） Amortization method Notes
Land use right 50 Straight
Special technology 15 Straight
Software 5 Straight
At the end of each year, the Company rechecks the service life and amortization method of intangible assets
with limited service life, adjusts the original estimate if it is different from the previous estimate, and handles the
change according to the accounting estimate.
See Note V. 21 for the method of depreciation of assets for Intangible assets
（2）Accounting Policy of Internal Research and Development Expenditure
The Company divides the expenditure of internal research and development projects into expenditures in
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research stage and expenditures in development stage.
Expenditures in research stage are included in current profits and losses when they occurs.
Expenditures in development stage can only be capitalized if they meet the following conditions: it is
technically feasible to complete the intangible assets so that they can be used or sold; There is the intention to
complete the intangible assets and use or sell them; The ways in which intangible assets generate economic
benefits, including those that can prove the existence of market for products produced by the intangible assets or
the existence of market for the intangible assets themselves, and that for the intangible assets that will be used
internally, their usefulness can be proved; There are sufficient technical, financial and other resources to complete
the development of the intangible assets and the ability to use or sell the intangible assets; Expenditures
attributable to the development stage of the intangible assets can be measured reliably. Development expenditures
that do not meet the above conditions are included in current profits and losses.
The research and development project of the Company will enter the development stage after the above
conditions are met and a project is approved through technical feasibility and economic feasibility study.
Capitalized expenditures in development stage are listed as development expenditures on the balance sheet,
and are converted into intangible assets from the date when the project reaches the intended purpose.
31.Long-term Assets Impairment
The asset impairment of long-term equity investment of subsidiaries, associated enterprises and joint
ventures, investment real estate, fixed assets, construction in progress, intangible assets, goodwill, etc. (except
inventory, investment real estate measured according to fair value model, deferred income tax assets and financial
assets) shall be determined according to the following methods:
On the balance sheet date, judge whether there is any sign of possible impairment of assets. If there is any
sign of impairment, the Company will estimate its recoverable amount and conduct impairment test. The goodwill
formed by business combination, intangible assets with uncertain service life and intangible assets that have not
yet reached the usable state are tested for impairment every year regardless of whether there is any sign of
impairment.
The recoverable amount is determined according to the higher of the net amount of the fair value of the asset
minus the disposal expenses and the present value of the estimated future cash flow of the asset. The Company
estimates its recoverable amount on the basis of individual assets; If it is difficult to estimate the recoverable
amount of a single asset, the recoverable amount of the asset group shall be determined based on the asset group
to which the asset belongs. The identification of asset group is based on whether the main cash inflow generated
by asset group is independent of cash inflow of other assets or asset groups.
When the recoverable amount of an asset or asset group is lower than its book value, the Company will write
down its book value to the recoverable amount, and the written-down amount will be included in the current
profits and losses, and the corresponding asset impairment provision will be accrued at the same time.
As far as the impairment test of goodwill is concerned, the book value of goodwill formed by business
combination is amortized to relevant asset groups according to a reasonable method from the acquisition date; If it
is difficult to amortize to the related asset group, it shall be amortized to the related asset group portfolio. The
related asset group or asset group portfolio is one that can benefit from the synergy effect of business combination,
and is not larger than the reporting segment determined by the Company.
In the impairment test, if there are signs of impairment in the asset group or asset group portfolio related to
goodwill, firstly, the asset group or asset group portfolio without goodwill shall be tested for impairment, the
recoverable amount shall be calculated, and the corresponding impairment loss shall be recognized. Then
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impairment test shall be carried out on the asset group or asset group portfolio containing goodwill, and its book
value shall be compared with the recoverable amount. If the recoverable amount is lower than the book value, the
impairment loss of goodwill shall be recognized.
Once the asset impairment loss is recognized, it will not be reversed in future accounting periods.
32.Long-term deferred expenses
The long-term deferred expenses incurred by the Company are priced at actual cost and amortized equally
according to the expected benefit period. For long-term deferred expense items that cannot benefit future
accounting periods, all their amortized values are included in current profits and losses.
33.Contract liabilities
Contract liabilities refer to the obligation of the Company to transfer goods to customers for the received or
receivable consideration from customers. If the customer has paid the contract consideration or the Company has
obtained the unconditional collection right before the Company transfers the goods to the customer, the Company
will list the received or receivable amount as the contract liability at the earlier of the actual payment made by the
customer and the due date for payment. Contract assets and liabilities under the same contract are listed in net
amount, while contract assets and liabilities under different contracts are not offset.
34.Remuneration
1. Accounting Treatment Method of Short-term Compensation
During the accounting period when employees provide services, the Company recognizes the actual wages,
bonuses, social insurance premiums such as medical insurance premiums, work-related injury insurance premiums
and maternity insurance premiums paid for employees and housing provident funds as liabilities, and includes
them in current profits and losses or related asset costs. If the liability is not expected to be fully paid within
twelve months after the end of the annual reporting period when employees provide relevant services, and the
financial impact is significant, the liability will be measured at the discounted amount.
2. Accounting Treatment Method of Severance Benefit Plans
After-service benefit plan includes defined contribution plan and defined benefit plans. Where the set deposit
plan refers to the post-employment benefits plan in which the enterprise no longer undertakes further payment
obligations after paying fixed fees to independent funds; Set benefit plan refers to the post-employment benefits
plan except the set deposit plan.
Set deposit plan
The set deposit plan includes basic old-age insurance, unemployment insurance and enterprise annuity plan,
etc.
In addition to the basic old-age insurance, the Company establishes an enterprise annuity plan ("annuity plan")
according to the relevant policies of the national enterprise annuity system, and employees can voluntarily
participate in the annuity plan. Moreover, the Company has no other significant social security commitments
for employees.
During the accounting period when employees provide services, the amount that should be paid according to
the set deposit plan is recognized as a liability and included in the current profits and losses or related asset costs.
Set benefit plan
For set benefit plans, an actuarial valuation is conducted by an independent actuary on the annual balance
sheet date, and the cost of benefit provision is determined by the expected cumulative benefit unit method. The
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employee remuneration cost caused by set benefit plans of the Company includes the following components:
① Service cost, including current service cost, past service cost and settlement gain or loss. Where: the
current service cost refers to the increase of the present value of set benefit plan obligations caused by the
employees providing services in the current period; Past service cost refers to the increase or decrease of the
present value of set benefit plan obligations related to employee service in previous period caused by the
modification of set benefit plans.
② The net interest of set benefit plan's net liabilities or net assets, including interest income of planned assets,
interest expense of set benefit plan obligations and interest affected by asset ceiling.
③ Changes arising from remeasurement of net liabilities or net assets of set benefit plans.
Unless other accounting standards require or allow employee benefit costs to be included in asset costs, the
Company will include the above items ① and ② in current profits and losses; Include item ③ in other
comprehensive income and such item will not be transferred back to profit or loss in the subsequent accounting
period. When the original set benefit plan is terminated, all the parts originally included in other comprehensive
income will be carried forward to undistributed profits within the scope of equity.
3. Accounting Treatment Method of Demission Welfare
If the Company provides dismissal benefits to employees, the employee remuneration liabilities arising from
the dismissal benefits shall be recognized and included in the current profits and losses on the earlier of the
following dates: When the Company cannot unilaterally withdraw the dismissal benefits provided by the
termination of labor relations plan or layoff proposal; When the Company recognizes the costs or expenses related
to the reorganization involving the payment of dismissal benefits.
If the employee's internal retirement plan is implemented, the economic compensation before the official
retirement date is the dismissal benefit. From the day when the employee stops providing services to the normal
retirement date, the wages of the retired employees and the social insurance premiums paid will be included in the
current profits and losses at one time. Economic compensation after the official retirement date (such as normal
pension) shall be treated as post-employment benefits.
4. Accounting Treatment Method of Other Long-term Employee Benefits
If other long-term employee benefits provided by the Company to employees meet the conditions for the set
deposit plan, they shall be handled in accordance with the above-mentioned relevant provisions on the set deposit
plan. If it meets the set benefit plans, it shall be handled in accordance with the above-mentioned relevant
regulations on set benefit plans, but the part of the related employee remuneration cost, which is "the change
caused by remeasurement of set benefit plan's net liabilities or net assets", shall be included in the current profits
and losses or related asset costs.
35.Lease liabilities
None
36. Estimated Liabilities
If the obligation related to contingencies meets the following conditions at the same time, the Company will
recognize it as estimated liabilities:
(1) Such obligation is the current obligation undertaken by the Company;
(2) The performance of such obligation is likely to lead to the outflow of economic benefits from the
Company;
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2021 Annual Report
(3) The amount of such obligation can be measured reliably.
Estimated liabilities are initially measured according to the best estimate of expenditure required to fulfill
relevant current obligations, and factors such as risks, uncertainties and time value of money related to
contingencies are comprehensively considered. If the time value of money has great influence, the best estimate is
determined by discounting the related future cash outflow. The Company rechecks the book value of the estimated
liabilities on the balance sheet date, and adjusts the book value to reflect the current best estimate.
If all or part of the expenses required to pay off the recognized estimated liabilities are expected to be
compensated by a third party or other parties, the compensation amount can only be recognized as an asset when it
is basically confirmed that it can be received. The recognized compensation amount shall not exceed the book
value of the recognized liabilities.
37. Share payment
(1) Types of share-based payment
The share-based payment of the Company is divided into equity-settled share-based payment and
cash-settled share-based payment.
(2) Method for determining fair value of equity instruments
The fair value of equity instruments such as options granted by the Company with active market is
determined according to the quoted price in the active market. The fair value of granted equity instruments such as
options without active market is determined by option pricing model. The selected option pricing model considers
the following factors: A. The exercise price of options; B. The validity period of the option; C. The current price
of the underlying shares; D. Estimated volatility of share price; E. Expected dividend of shares; F. Risk-free
interest rate within the validity period of the option.
(3) Basis for determining the best estimation of feasible equity instruments
On each balance sheet date during the waiting period, the Company makes the best estimate based on the
latest available follow-up information such as changes in the number of employees with feasible rights, and
revises the estimated number of equity instruments with feasible rights. On the vesting date, the final estimated
number of vesting rights and interests instruments shall be consistent with the actual number of vesting rights.
(4) Accounting treatment related to implementation, modification and termination of share-based payment plan
Equity-settled share-based payment is measured at the fair value of equity instruments granted to employees.
If the right is exercised immediately after the grant, the relevant costs or expenses shall be included in the fair
value of equity instruments on the grant date, and the capital reserve shall be increased accordingly. If the rights
can be exercised only after the services within the waiting period are completed or the specified performance
conditions are met, on each balance sheet date within the waiting period, based on the best estimate of the number
of equity instruments available, the services obtained in the current period shall be included in the relevant costs
or expenses and capital reserve according to the fair value on the grant date of equity instruments. After the
vesting date, the recognized related costs or expenses and the total owner's equity will not be adjusted.
Equity-settled share-based payment shall be measured according to the fair value of liabilities calculated and
determined on the basis of shares or other equity instruments undertaken by the Company. If the right is exercised
immediately after the grant, the fair value of the liabilities assumed by the Company shall be included in the
relevant costs or expenses on the grant date, and the liabilities shall be increased accordingly. For cash-settled
share-based payment that is feasible only after the service within the waiting period is completed or the specified
performance conditions are met, on each balance sheet date within the waiting period, based on the best
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estimation of the feasibility and according to the fair value of the liabilities assumed by the Company, the services
obtained in the current period are included in the costs or expenses and corresponding liabilities. On each balance
sheet date and settlement date before the settlement of related liabilities, the fair value of liabilities shall be
re-measured, and the changes shall be included in the current profits and losses.
When the Company modifies the share-based payment plan, if the fair value of the granted equity
instruments is increased by modification, the increase of the services obtained shall be recognized according to the
increase of the fair value of the equity instruments; If the number of granted equity instruments is increased by
modification, the fair value of the increased equity instruments will be recognized as the increase in services
obtained accordingly. The increase of fair value of equity instruments refers to the difference between the fair
values of equity instruments before and after modification on the modification date. If the total fair value of
share-based payment is reduced by modification or the terms and conditions of the share-based payment plan are
modified in other ways that are unfavorable to employees, the accounting treatment of the obtained services will
continue, as if with no changes unless the Company cancels some or all of the granted equity instruments.
During the waiting period, if the granted equity instruments are cancelled (except those cancelled due to
non-market conditions that do not meet the feasible rights conditions), the Company will treat the cancellation of
the granted equity instruments as an accelerated exercise, and immediately record the amount to be recognized in
the remaining waiting period into the current profits and losses, and recognize the capital reserve at the same time.
If the employee or other party can choose to meet the non-feasible right condition but fails to meet it during the
waiting period, the Company will treat it as a cancellation for granting equity instruments.
38. Other financial instruments such as preferred stocks and perpetual bonds
None
39. Revenue
Accounting policies adopted for income recognition and measurement
(1) General principles
The Company has fulfilled the performance obligation in the contract, that is, to recognize the revenue when
the customer obtains the control right of related goods or services.
If the contract contains two or more performance obligations, the Company will amortize the transaction
price to each individual performance obligation according to the relative proportion of the individual selling price
of the goods or services promised by each individual performance obligation on the contract start date, and
measure the income according to the transaction price amortized to each individual performance obligation.
When one of the following conditions is met, the Company will fulfill its performance obligations within a
certain period of time; Otherwise, it performs the performance obligation at a certain time:
① The customer obtains and consumes the economic benefits brought by the Company's performance at the
same time of the its performance.
② Customers can control the goods under construction during the performance of the Company.
③ The commodities produced during the performance of the Company have irreplaceable uses, and the
Company has the right to collect payment for the performance part accumulated so far during the whole contract
period.
For the performance obligations performed within a certain period of time, the Company recognizes the
income according to the performance progress within that period. If the performance progress cannot be
reasonably determined, and the cost incurred of the Company is expected to be compensated, the income shall be
recognized according to the amount of the cost incurred until the performance progress can be reasonably
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2021 Annual Report
determined.
For obligations performed at a certain time, the Company shall recognize the income at the time when the
customer obtains control of the relevant goods or services. When judging whether a customer has obtained control
of goods or services, the Company will consider the following signs:
① The Company has the current right to receive payment for the goods or services, that is, the customer has
the current payment obligation for the goods or services.
② The Company has transferred the legal ownership of the goods to the customer, that is, the customer has
the legal ownership of the goods.
③ The Company has transferred the physical goods to the customer, that is, the customer has physically
taken possession of the goods.
④ The Company has transferred the main risks and rewards on the ownership of the goods to the customer,
that is, the customer has obtained the main risks and rewards on the ownership of the goods.
⑤ The customer has accepted the goods.
⑥ Other signs that the customer has obtained control of the goods.
The Company has transferred goods or services to customers and has the right to receive consideration (and
the right depends on other factors except the passage of time) as contract assets, and the contract assets are
depreciated on the basis of expected credit losses. The right of the Company to collect consideration from
customers unconditionally (only depending on the passage of time) is listed as receivables. The obligation of the
Company to transfer goods or services to customers for received or receivable consideration from customers shall
be regarded as a contractual liability.
Contract assets and contract liabilities under the same contract are listed in net amount. If the net amount is
debit balance, they are listed in "Contract Assets" or "Other Non-current Assets" according to their liquidity; If the
net amount is the credit balance, it shall be listed in "Contract Liabilities" or "Other Non-current Liabilities"
according to its liquidity.
(2) Specific method
The specific method of revenue recognition of the Company is as follows:
Polarizer/Textile and garment sales contract:
Domestic sales: When the goods are delivered to the customer and the customer has accepted the goods, the
customer obtains the control of the goods, and the Company recognizes the revenue.
Export: A. When the customer receives goods in China, the revenue recognition is the same as "Revenue
Recognition for Domestic Sales"; B. When the delivery place of customer is outside the country, the Company
mainly adopts FOB. When the goods are delivered from the warehouse and have been exported for customs
declaration, the Company recognizes the revenue.
Revenue from property/accommodation services:
In the process of property/accommodation service provision, the Company recognizes revenue by stages.
The adoption of different business models in similar businesses leads to differences in accounting policies for
income recognition
None
40.Government subsidy
Government subsidies are recognized when they meet the conditions attached to government subsidies and
can be received.
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Government subsidies for monetary assets shall be measured according to the amount received or receivable.
Government subsidies for non-monetary assets are measured at fair value; If the fair value cannot be obtained
reliably, it shall be measured according to the nominal amount RMB 1.
Government subsidies related to assets refer to government subsidies obtained by the Company for
purchasing and building or forming long-term assets in other ways; In addition, as a government subsidy related to
income.
Where the government documents do not specify the object of the subsidy, and the subsidy can form
long-term assets, the part of the government subsidies corresponding to the value of the assets shall be regarded as
the government subsidy related to the assets, and the rest shall be regarded as the government subsidies related to
the income; where it is difficult to be distinguished, government subsidies as a whole are treated as income-related
government subsidies.
Government subsidies related to assets offset the book value of related assets, or are recognized as deferred
income and included in profits and losses by stages according to a reasonable and systematic method within the
service life of related assets. Government subsidies related to income, which are used to compensate related costs
or losses that have occurred, are included in current profits and losses or offset related costs; If used to
compensate related costs or losses in later periods, they will be included in the deferred income, and included in
the current profits and losses or offset related costs during the recognition period of related costs or losses.
Government subsidies measured in nominal amount are directly included in current profits and losses. The
Company adopts a consistent approach to the same or similar government subsidy business.
Government subsidies related to daily activities are included in other income or offset related costs according
to the nature of economic business. Government subsidies irrelevant to routine activities shall be included into the
non-operating receipt and disbursement.
When the recognized government subsidy needs to be returned, if the book value of related assets is offset
during initial recognition, the book value of assets will be adjusted; If there is a relevant deferred income balance,
the book balance of the relevant deferred income will be offset, and the excess will be included in the current
profits and losses; In other cases, it is directly included in the current profits and losses.
For the discount interest of preferential policy loans, if the finance allocates the discount interest funds to the
lending bank, the actually received loan amount is taken as the recorded value of the loan, and the borrowing costs
are calculated according to the loan principal and preferential policy interest rate. If the finance directly allocates
the discount interest funds to the Company, the discount interest will offset the borrowing costs.
41.The Deferred Tax Assets / The deferred Tax Liabilities
Income tax includes current income tax and deferred income tax. Except for adjusted goodwill arising from
business combination or deferred income tax related to transactions or matters directly included in owner's equity,
they are all included in current profits and losses as income tax expenses.
According to the temporary difference between the book value of assets and liabilities and the tax basis on
the balance sheet date, the Company adopts the balance sheet liability method to confirm deferred income tax.
All taxable temporary differences are recognized as related deferred income tax liabilities, unless the taxable
temporary differences are generated in the following transactions:
(1) Initial recognition of goodwill, or the initial recognition of assets or liabilities arising from transactions
with the following characteristics: the transaction is not a business combination, and the transaction does not
affect accounting profits or taxable income when it occurs;
(2) For taxable temporary differences related to investments of subsidiaries, joint ventures and associated
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2021 Annual Report
enterprises, the time for the temporary differences to be reversed can be controlled and the temporary differences
will probably not be reversed in the foreseeable future.
For deductible temporary differences, deductible losses and tax deductions that can be carried forward to
later years, the Company shall recognize the deferred income tax assets arising therefrom to the extent that it is
likely to obtain the future taxable income used to offset the deductible temporary differences, deductible losses
and tax deductions, unless the deductible temporary differences are generated in the following transactions:
(1) The transaction is not a business combination, and it does not affect accounting profit or taxable income
when the transaction occurs;
(2) For deductible temporary differences related to investments of subsidiaries, joint ventures and associated
enterprises, corresponding deferred income tax assets are recognized if the following conditions are met at the
same time: temporary differences are likely to be reversed in the foreseeable future, and taxable income used to
offset the deductible temporary differences is likely to be obtained in the future.
On the balance sheet date, the Company measures deferred income tax assets and deferred income tax
liabilities according to the applicable tax rate during the expected period of recovering the assets or paying off the
liabilities, and reflects the income tax impact of the expected way of recovering the assets or paying off the
liabilities on the balance sheet date.
On the balance sheet date, the Company rechecks the book value of deferred income tax assets. If it is
unlikely that sufficient taxable income will be obtained in the future period to offset the benefits of deferred
income tax assets, the book value of deferred income tax assets will be written down. When sufficient taxable
income is likely to be obtained, the written-down amount shall be reversed.
42.Lease
(1) Accounting treatment method of operating lease
For rent in operating lease, the Company shall recognize the current profits and losses according to the
straight-line method in each period of the lease term. The initial direct expenses related to the operating lease shall
be capitalized, apportioned on the same basis as the rental income during the lease term, and included in the
current profits and losses by stages. The variable lease payment related to operating lease, which is not included in
the lease collection amount, shall be included in the current profits and losses when actually incurred.
(2) Accounting treatment method of financial lease
In financial lease, at the beginning date of the lease term, the Company takes the net lease investment as the
recorded value of the financial lease receivable, and the net lease investment is the sum of the unsecured residual
value and the present value of the lease receipts that have not yet been received on the start date of the lease term
discounted according to the interest rate of the lease. As the lessor, the Company calculates and recognizes the
interest income of each period in the lease term according to the fixed periodic interest rate. The variable lease
payments obtained by the Company as the lessor that are not included in the measurement of net lease investment
are included in the current profits and losses when actually incurred.
The derecognition and impairment of financial lease receivables shall be treated according to the provisions of
Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments and
Accounting Standards for Business Enterprises No.23-Transfer of Financial Assets.
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2021 Annual Report
43. Other important accounting policies and accounting estimates
(1)Change of main accounting policies
Accounting policy changes caused by implementation of new financial instrument standards
（2） Changes in accounting estimates
No significant changes in accounting estimates have occurred in the current period.
44.Change of main accounting policies and estimations
(1)Change of main accounting policies
√ Applicable □Not applicable
The content and reason for change of
Approval process Remarks
accounting policy
In order to adapt to the development of
market economy, it standardizes the
accounting treatment of related
economic business and improves the
quality of accounting information. On
December 7, 2018, the Ministry of
Finance issued the Notice on Revision
The examined and http://www.cninfo.com.cn On
and Issuance of Accounting Standards
Adopted at the 2nd meeting of the 8th March 12,2021(Announcement
for Business Enterprises No.21-Leasing
Board of Directors No.:2021-12)
(CS [2018] No.35) (hereinafter referred
to as the "New Leasing Standards").
According to the regulations, the
Company will implement the New
Leasing Standards from January 1, 2021
and adjust the relevant contents of
accounting policies.
①New Leasing Standards
In 2018, the Ministry of Finance issued the revised Accounting Standards for Business Enterprises No.21-Leasing
(hereinafter referred to as "New Leasing Standards"), which shall come into effect on January 1, 2019 for
enterprises listed at home and abroad and those listed overseas and using international financial reporting
standards or accounting standards for business enterprises to prepare financial statement, and on January 1, 2021
for other enterprises that implement accounting standards for business enterprises. The Company has implemented
the New Leasing Standards since January 1, 2021. According to the relevant provisions of the New Leasing
Standards, the Company held the second meeting of the Eighth Board of Directors on March 10, 2021, approved
the implementation of the New Leasing Standards from January 1, 2021, and adjusted the relevant contents of the
accounting policy. See Notes III. 30 and 31 for the changed accounting policies.
For the contracts existing before the first implementation date, the Company chooses not to re-evaluate whether
they are leases or include leases on the first implementation date. For contracts signed or changed after the first
implementation date, the Company evaluates whether the contract is a lease or includes a lease according to the
definition of lease in the New Leasing Standards.
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2021 Annual Report
The definition of lease in the New Leasing Standards does not have any significant impact on the scope of
contracts in which the Company meets the definition of lease.
As lessee
The New Leasing Standards require the lessee to recognize the right-to-use assets and lease liabilities for all leases,
except for short-term leases and low-value asset leases that are simplified, and to recognize depreciation and
interest expenses respectively.
The New Leasing Standards allow the lessee to choose one of the following methods to perform connection
accounting treatment on the lease:
According to the Accounting Standards for Business Enterprises No.28-Accounting Policies, Changes in
Accounting Estimates and Error Correction, retrospective adjustment method is adopted.
According to the cumulative impact of the first implementation of these standards, the amount of retained
earnings and other related items in the financial statements at the beginning of the first implementation of
these standards are adjusted, and the information of comparable period is not adjusted.
According to the New Leasing Standards, the Company has retroactively adjusted the difference between the first
implementation date of New Leasing Standards and the current lease standards into the retained earnings at the
beginning of 2021. At the same time, the Company has not adjusted the data of comparative financial statements.
For the financial lease before the first implementation date, the Company measures the right-to-use assets and
lease liabilities respectively according to the original book value of the financial lease assets and the financial
lease payments payable;
For the operating lease before the first implementation date, the Company measures the lease liabilities according
to the present value of the remaining lease payment discounted at the incremental borrowing rate on the first
implementation date, and for the lease of houses and buildings, it measures the right-to-use assets according
to the amount equal to the lease liabilities, and makes necessary adjustments according to the prepaid rent.
On the first implementation date, the Company conducts impairment test on the right-to-use assets and conducts
corresponding accounting treatment according to Notes III. 31.
The Company adopts simplified treatment for the operating lease whose leased assets are low-value assets before
the first implementation date or the operating lease that will be completed within 12 months, without recognizing
the right-to-use assets and lease liabilities.
The Company adopts the following simplified treatment for the operating lease before the first implementation
date:
When measuring lease liabilities, the same discount rate can be adopted for leases with similar characteristics; The
measurement of the right-to-use assets may not include the initial direct cost;
If there is an option to renew or terminate the lease, the Company will determine the lease term according to the
actual exercise of the option before the first implementation date and other latest information;
As a substitute for the impairment test of the right-to-use assets, the Company evaluates whether the contract
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2021 Annual Report
including leases is an onerous contract before the first implementation date, and adjusts the right-to-use assets
according to the loss reserve amount included in the balance sheet before the first implementation date;
For the lease change before the first implementation date, the Company makes accounting treatment according to
the final arrangement of the lease change.
The impact of the implementation of the New Leasing Standards on the items of consolidated balance sheet as of
January 1, 2021 is as follows:
Items Book balance before Re Re-measurement Book balance after
adjustment（December classificatio adjustment（January 1,
31,2020） n 2021）
Assets：
Right to use assets -- -- 13,762,176.74 13,762,176.74
Total of assets -- -- 13,762,176.74 13,762,176.74
Liabilities
Non-current liabilities due within 1 -- -- 4,342,927.51 4,342,927.51
year
Lease liabilities -- -- 9,419,249.23 9,419,249.23
Total of liabilities -- -- 13,762,176.74 13,762,176.74
For the unpaid minimum lease payment of major operating leases disclosed in the 2020 financial statements, the Company adjusted
the unpaid minimum operating lease payment disclosed under the original lease standards to the lease liabilities recognized under the
New Leasing Standards according to the incremental loan interest rate of the lessee on January 1, 2021, as follows:
Minimum lease payment for major operating lease on December 31, 2020 A 14,740,264.72
Less: Short-term lease with simplified treatment B 42,452.83
Less: Lease of low-value assets with simplified treatment C --
Plus: Re-evaluated adjustment of the minimum lease payment in the lease term D --
Plus: Variable lease payment adjustment depending on index or ratio E --
Subtotal F=A-B-C+/-D+/-)E 14,697,811.89
Less：VAT G --
Adjusted operating lease commitment H=F-G 14,697,811.89
Present value of operating lease payment on January 1, 2021 I 13,762,176.74
Plus: Financial lease payable on December 31, 2020 J --
Lease liabilities on January 1st, 2021 K=I+J 13,762,176.74
Including: non-current liabilities due within one year 4,342,927.51
The book value of the right-to-use assets on January 1, 2021 is as follows:
Items 2021.01.01
Right-to-use assets
For the right-to-use assets recognized by the operating lease before the 13,762,176.74
first implementation date
Financing leased assets recognized under the original lease standards --
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2021 Annual Report
Total： 13,762,176.74
The impact of the implementation of the New Leasing Standards on the items of 2021 financial statement is as
follows:
Items of consolidated balance sheet Number of statements as of Assuming that according to Increase/decrease (-)
December 31, 2021 the original lease standards
Assets：
Construction in process 71,482,031.08 71,510,678.35 -28,647.27
Right to use assets 9,221,189.37 -- 9,221,189.37
Total of assets 80,703,220.45 71,510,678.35 9,192,542.10
Liabilities
Non-current liabilities due within 1
5,175,393.52 -- 5,175,393.52
year
Lease liabilities 4,243,855.71 -- 4,243,855.71
Total of liabilities 9,419,249.23 -- 9,419,249.23
Items of consolidated income statement Number of statements in Assuming that according Increase/decrease (-)
2021 to the original lease
standards
Business costs 1,908,519,413.28 1,908,686,016.10 -166,602.82
Administration expenses 122,088,830.15 122,170,567.39 -81,737.24
Financial expenses -130,344.09 -605,391.28 475,047.19
As lessor
According to the New Leasing Standards, the Company does not need to adjust its lease as a lessor according to
the connection regulations, but it needs to make accounting treatment according to the New Leasing Standards
from the date when the New Leasing Standards are first implemented.
（2）Change of main accounting estimations
□ Applicable √Not applicable
（3）Adjustments to the Financial Statements at the Beginning of the First Execution Year of any New Standards
Governing Financial Instruments, Revenue or Leases from year 2021
√ Applicable □ Not applicable
Whether need to adjust the balance sheet account at the beginning of the year
□ Yes √ No
No reason for adjusting the balance sheet account at the beginning of the year
No related business.
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2021 Annual Report
（4）Retrospective Restatement of Previous Comparative Data due to the First Execution of any New Standards
Governing Financial Instruments or Leases from year 2021
□ Applicable √ Not applicable
45.Other
None
VI. Taxes of the Company
1. Main taxes categories and tax rate
Taxes Tax references Applicable tax rates
VAT The taxable turnover 13%,6%,5%
City construction tax Turnover tax to be paid allowances 7%
Business income tax Turnover tax to be paid allowances 25%,20%,16.5%,15%
Education surcharge Turnover tax to be paid allowances 3%
Local education surcharge Turnover tax to be paid allowances 2%
In case there exist any taxpayer paying corporate income tax at different tax rates, disclose the information
Name of taxpayer Income tax rates
2. Tax preference
.In accordance with relevant provisions of the Notice of Ministry of Finance, General Administration of Customs
and State Taxation Administration Regarding Tax Preference Policies for Further Supporting the Development of
New-type Display Device Industry (Cai Guan Shui (2021) No. 19),The Company manufactured key materials and
parts for the upstream industry of new-type display devices including colorful light filter coating and polarizer
sheet that comply with the planning for independent development of domestic industries may enjoy the preferentia
l policies of exemption from import tariff for the import of raw materials and consumables for the purpose of self
use and production that can not be produced domestically from January 1, 2021 and December 31, 2030.
SAPO Photoelectric Co., Ltd. the subsidiary company of our company, has been qualified as national high-tech
enterprise since 2019 ,High-tech and enterprise certificate No.: GR201944205666 ,The certificate is valid for
three years, The enterprise income tax rate of this year is 15%.
Shenzhen Beauty Century Garment Co., Ltd., Shenzhen Huaqiang Hotel Garment Co., Ltd. and Shenzhen
Lisi Industrial Development Co., Ltd., subsidiaries of the Company, are all small and low-profit enterprises as
stipulated in the Notice of the Ministry of Finance and the State Administration of Taxation on Implementing
Inclusive Tax Concession Policy for Small and Micro Enterprises (CS [2019] No.13). For the part of the taxable
income of this year that does not exceed RMB 1 million, the taxable income is reduced to 12.5%, and the
enterprise income tax is paid at a rate of 20%; For the taxable income of this year that exceeds RMB 1 million but
does not exceed RMB 3 million, the taxable income is reduced to 50% and the enterprise income tax is paid at a
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2021 Annual Report
rate of 20%.
3.Other
None
VII. Notes of consolidated financial statement
1.Monetary Capital
In RMB
Items Year-end balance Year-beginning balance
Cash at hand 792.64 4,127.10
Bank deposit 302,472,035.96 271,085,025.10
Other monetary funds -- 7,998,084.75
Total 302,472,828.60 279,087,236.95
Including : The total amount of deposit abroad 6,009,898.07 7,829,822.78
Other note
At the end of the period, there is no mortgage, pledge or freezing, or money deposited abroad with restricted
repatriation.
2. Transactional financial assets
In RMB
Items Year-end balance Year-beginning balance
Financial assets measured at their fair
values and with the variation included in 586,540,735.16 684,617,260.06
the current profits and losses
Including：
Structure deposit 0.00 200,536,575.34
Monetary fund 586,540,735.16 484,080,684.72
Including
Total 586,540,735.16 684,617,260.06
Other note：
3. Derivative financial assets
单位：元
Items Year-end balance Year-beginning balance
Other note：
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2021 Annual Report
4. Notes receivable
(1) Notes receivable listed by category
In RMB
Items Year-end balance Year-beginning balance
Bank acceptance 77,296,787.26 0.00
Commercial acceptance 72,646,093.02 16,813,657.28
Total 149,942,880.28 16,813,657.28
In RMB
Amount in year-end Balance Year-beginning
Bad debt
Book Balance Book Book Balance Bad debt provision Book
Category provision
value value
Amoun Proport Amoun Proport Amoun Proport Amount Proport
t ion(%) t ion(%) t ion(%) ion(%)
Of which：
Accrual of bad 138,11 149,94
100.00 365,05 16,898, 100.00 84,490.7 16,813,
debt provision by 0,166.1 0.24% 2,880.2 0.50%
% 5.74 148.02 % 4 657.28
portfolio 7 8
Of which：
Commercial 73,011, 48.57 365,05 72,646, 16,898, 100.00 84,490.7 16,813,
0.50% 0.50%
acceptance 148.76 % 5.74 093.02 148.02 % 4 657.28
65,099, 47.14 65,099,
Bank acceptance 0.00 0.00% 0.00 0.00% 0.00 0.00% 0.00
017.41 % 017.41
150,30 149,94
100.00 365,05 16,898, 100.00 84,490.7 16,813,
Total 7,936.0 0.24% 2,880.2 0.50%
% 5.74 148.02 % 4 657.28
2 8
Accrual of bad debt provision by single item:
In RMB
Amount in year-end
Name
Book Balance Bad debt provision Proportion(%) Reason
Accrual of bad debt provision by portfolio: Commercial acceptance
In RMB
Amount in year-end
Name
Book balance Bad debt provision Proportion(%)
Commercial acceptance 73,011,148.76 365,055.74 0.50%
Note：
Accrual of bad debt provision by portfolio:
176
2021 Annual Report
In RMB
Amount in year-end
Name
Book balance Bad debt provision Proportion(%)
Note：
Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of
other receivables if the provision for bad debts of bills receivable is accrued according to the general model of
expected credit loss:
√ Applicable □ Not applicable
None
(2) Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision：
In RMB
Amount of change in the current period
Opening Reversed or Closing
Category
balance Accrual collected Write-off Other balance
amount
84,490.74 280,565.00 365,055.74
Total 84,490.74 280,565.00 365,055.74
Of which the significant amount of the reversed or collected part during the reporting period
□ Applicable √ Not applicable
（3）Notes receivable pledged by the company at the end of the period
In RMB
Items Amount
（ 4 ） Accounts receivable financing endorsed or discounted by the Company at the end of the period and not
expired yet on the date of balance sheet
In RMB
Amount derecognized at the end of the Amount not yet derecognized at the end
Items
period of the period
Bank acceptance 65,099,017.41
Total 65,099,017.41
177
2021 Annual Report
（5）Accounts receivable financing transferred to accounts receivable by the Company at the end of the period
due to failure of the drawer to perform
In RMB
Items Amount
Other note
At the end of the term, the Company has no notes to transfer the drawer to the receivables.
（6）The Company had no accounts receivable financing actually written off in the period
In RMB
Items Amount
5. Account receivable
(1)Classification account receivables.
In RMB
Amount in year-end Amount in year-begin
Bad debt
Book balance Book balance Bad debt provision
Category provision Book Book
Amoun Proport Amoun Proport value Amoun Proport Amoun Proport value
t ion(%) t ion(%) t ion(%) t ion(%)
Accrual of bad
13,260, 13,260, 100.00 20,641, 13,552, 7,088,13
debt provision by 2.57% 3.52% 65.66%
307.34 307.34 % 002.24 865.25 6.99
single item
Including：
Accrual of bad 502,84 479,99 565,27
97.43 22,849, 25,057, 540,222,
debt provision by 8,549.9 4.54% 8,708.5 9,517.4 96.48% 4.43%
% 841.40 436.56 080.91
portfolio 7 7 7
Including：
516,10 479,99 585,92
100.00 36,110, 100.00 38,610, 547,310,
Total 8,857.3 7.00% 8,708.5 0,519.7 6.59%
% 148.74 % 301.81 217.90
1 7 1
Accrual of bad debt provision by single item:
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion Reason
Dongguan Yaxing Beyond the credit
Semiconductor Co., 2,797,016.81 2,797,016.81 100.00% period for a long time,
Ltd. uncertain recovered.
178
2021 Annual Report
Beyond the credit
Dongguan Fair LCD
1,697,122.75 1,697,122.75 100.00% period for a long time,
Co., Ltd.
uncertain recovered.
Guangdong Ruili Beyond the credit
Baolai Technology 1,298,965.36 1,298,965.36 100.00% period for a long time,
Co., Ltd. uncertain recovered.
Huangshan Beyond the credit
Zhongxianwei Electric 902,031.00 902,031.00 100.00% period for a long time,
Co., Ltd. uncertain recovered.
Shenzhen Gulida Beyond the credit
Microelectronics Co., 422,178.00 422,178.00 100.00% period for a long time,
Ltd. uncertain recovered.
Beyond the credit
Other 6,142,993.42 6,142,993.42 100.00% period for a long time,
uncertain recovered.
Total 13,260,307.34 13,260,307.34 -- --
Accrual of bad debt provision by single item:
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion Reason
Accrual of bad debt provision by portfolio:
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion
Within 1 year 502,848,447.18 22,849,816.11 4.55%
1-2 years 102.79 25.29 24.60%
Total 502,848,549.97 22,849,841.40 --
Note：
Accrual of bad debt provision by portfolio:
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion
Note：
Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of
other receivables if the provision for bad debts of bills receivable is accrued according to the general model of
expected credit loss:
□ Applicable √ Not applicable
179
2021 Annual Report
Disclosure by aging
In RMB
Aging Closing balance
Within 1 year（Including 1 year） 502,894,801.73
1-2 years 5,702.29
2-3 years 676,153.40
Over 3 years 12,532,199.89
3-4 years 103,011.28
4-5 years 389.73
Over 5 years 12,428,798.88
Total 516,108,857.31
(2) Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision：
In RMB
Amount of change in the current period
Opening Reversed or Closing
Category
balance Accrual collected Write-off Other balance
amount
38,610,301.81 -1,531,351.49 968,801.58 36,110,148.74
Total 38,610,301.81 -1,531,351.49 968,801.58 36,110,148.74
Of which the significant amount of the reversed or collected part during the reporting period :
In RMB
Name Amount Way
(3) The actual write-off accounts receivable
In RMB
Items Amount
Of which the significant amount of the reversed or collected part during the reporting period :
In RMB
Whether the
Verification money is
Name Nature Amount Reason procedures generated by
performed related party
transactions
Note：
180
2021 Annual Report
None
(4) Top 5 of the closing balance of the accounts receivable collected according to the arrears party
In RMB
Name Balance in year-end Proportion(%) Bad debt provision
TCL CSOT 81,678,407.05 15.83% 3,700,031.84
CSOT 64,415,196.86 12.48% 2,918,008.42
Huijin（Shenzhen）
49,476,257.03 9.59% 2,241,274.45
Technology Co., Ltd.
LG Display（China）Co.,
36,387,596.37 7.05% 1,648,358.12
Ltd.
LG Display
35,275,590.17 6.83% 1,597,984.24
（Guangzhou) Co., Ltd.
Total 267,233,047.48 51.78%
（5）Account receivable which terminate the recognition owning to the transfer of the financial assets
None
(6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts
receivable
None
6.Receivable financing
In RMB
Items Closing balance Opening balance
Note receivable 21,474,101.07 102,051,314.08
Total 21,474,101.07 102,051,314.08
Changes in current period and fair value of receivables financing
√Applicable □Not applicable
None
Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of
other receivables if the provision for bad debts of bills receivable is accrued according to the general model of
expected credit loss:
√Applicable □Not applicable
None
Other note：
Some subsidiaries of the Company discount and endorse some bank acceptance bills according to the needs
of their daily fund management, therefore the bank acceptance bills of the subsidiaries are classified as financial
assets measured at fair value with changes included in other comprehensive income.
There is no single bank acceptance bill with impairment provision of the Company. On December 31, 2021,
181
2021 Annual Report
the Company considered that there was no significant credit risk in the bank acceptance bills held by it, and there
would be no significant loss due to bank default.
7.Prepayments
(1) List by aging analysis:
In RMB
Closing balance Opening balance
Aging
Amount Proportion % Amount Proportion %
Within 1 year 15,157,623.27 98.38% 14,934,263.03 88.35%
1-2 years 248,996.26 1.62% 557,043.06 3.30%
2-3 years 540,748.42 3.20%
Over 3 years 870,461.88 5.15%
Total 15,406,619.53 -- 16,902,516.39 --
Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled in time
On December 31, 2021, there was no large prepayment with an accounting age of more than one year in the
balance of prepayment .
（2）The ending balance of Prepayments owed by the imputation of the top five parties
The top five ending balances of prepayments collected according to prepaid objects totaled RMB
7,270,639.80, accounting for 47.20 % of the total closing balances of prepayments.
Other note：None
8.Other receivable
In RMB
Items Closing balance Opening balance
Other accounts receivable 140,185,750.40 5,265,002.71
Total 140,185,750.40 5,265,002.71
（1）Interest receivable
1) Category of interest receivable
单位：元
Items Closing balance Opening balance
Fixed deposit 0.00 0.00
Entrusted loan 0.00 0.00
Bond investment 0.00 0.00
182
2021 Annual Report
2) Significant overdue interest
In RMB
Whether with
Balance in Reasons for
Items Aging impairment and the
year-end non-recovery
judgment basis
Other note：
3）The bad debt provision
□ Applicable √ Not applicable
（2）Dividend receivable
1)Dividend receivable
In RMB
Items Balance in year-end Balance Year-beginning
2）Significant dividend receivable aged over 1 year
In RMB
Whether with
Balance in Reasons for
Items Aging impairment and the
year-end non-recovery
judgment basis
3）The bad debt provision
□ Applicable √ Not applicable
Other note：
（3） Other accounts receivable
1) Other accounts receivable classified
In RMB
Nature Closing book balance Opening book balance
Reserve Funds and Employee Loans 293,128.97 379,477.97
Deposit and security deposit 144,954,822.31 2,585,585.87
Export tax rebate 1,698,919.82 1,658,146.29
183
2021 Annual Report
Unit exchanges 16,402,902.33 16,369,395.10
Other 1,834,489.23 2,069,761.14
Total 165,184,262.66 23,062,366.37
2）Bad-debt provision
In RMB
Stage 1 Stage 2 Stage 3
Expected credit Expected credit loss over Expected credit losses for
Bad Debt Reserves Total
losses over the next life (no credit the entire duration (credit
12 months impairment) impairment occurred)
Balance as at January
573,597.01 17,223,766.65 17,797,363.66
1, 2021
Balance as at January
—— —— —— ——
1, 2021in current
Provision in the current
7,221,660.06 7,221,660.06
period
Balance as at
7,795,257.07 17,203,255.19 24,998,512.26
December 31,2021
Loss provision changes in current period, change in book balance with significant amount
√ Applicable □Not applicable
Disclosure by aging
In RMB
Aging Closing balance
Within 1 year(Including 1 year） 146,289,172.36
1-2 years 931,075.99
2-3 years 411,482.57
Over 3 years 17,552,531.74
3-4 years 546,382.79
4-5 years 537,717.29
Over 5 years 16,468,431.66
Total 165,184,262.66
3) Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision：
In RMB
Opening Amount of change in the current period
Category Closing balance
balance Accrual Reversed or Write-off Other
184
2021 Annual Report
collected
amount
17,797,363.
7,221,660.06 20,511.46 24,998,512.26
66
17,797,363.
Total 7,221,660.06 20,511.46 24,998,512.26
66
Note
Where the current bad debts back or recover significant amounts:
In RMB
Name Amount Mode
4) Other account receivables actually cancel after write-off
In RMB
Items Amount
Of which the significant amount of the reversed or collected part during the reporting period :
In RMB
Whether the
Verification money is
Name Nature Amount Reason procedures generated by
performed related party
transactions
Other note
5)Top 5 of the closing balance of the other accounts receivable collected according to the arrears party
In RMB
Portion in total Bad debt provision
Name Nature Year-end balance Aging other of year-end
receivables(%) balance
Shenzhen Beauty
Internal current
Century Garment 143,101,258.40 1-3 years 86.63% 7,155,062.92
account
Co., Ltd.
Jiangxi Xuanli
Unit account 11,389,044.60 Over 5 years 6.89% 11,389,044.60
Thread Co., Ltd.
Anhui Huapeng
Unit account 1,800,000.00 Over 5 years 1.09% 1,800,000.00
Textile Company
Shenzhen Dailisi
Underwear Co., Unit account 1,100,000.00 Within 1 year 0.67% 55,000.00
Ltd
Shenzhen Xieli Unit account 1,018,295.37 2-5 years 0.62% 1,018,295.37
185
2021 Annual Report
Automobile
Repair Plant
Total -- 158,408,598.37 -- 95.90% 21,417,402.89
6) Accounts receivable involved with government subsidies
In RMB
Name of the Time, amount and
Name government subsidy Year-end balance Aging basis of the expected
project collection
The company has no government subsidies receivable.
7) Other account receivable which terminate the recognition owning to the transfer of the financial assets
None
8) The amount of the assets and liabilities formed by the transfer and the continues involvement of other accounts
receivable
None
Other note：
9. Inventories
Whether the company need to comply with the disclosure requirements of the real estate industry
No
（1）Category of Inventory
In RMB
Closing book balance Opening book balance
Items Provision for Provision for
Book balance inventory Book value Book balance inventory Book value
impairment impairment
Raw materials 349,978,870.87 26,335,509.94 323,643,360.93 258,191,196.82 13,788,646.60 244,402,550.22
Processing
10,992,072.59 10,992,072.59 2,715,845.96 2,715,845.96
products
Good in stock 118,034,342.61 36,750,396.02 81,283,946.59 132,780,479.72 43,914,789.90 88,865,689.82
Goods in transit 7,910,629.62 30,573.89 7,880,055.73 524,698.46 524,698.46
Semi-finished 270,743,032.26 34,298,745.28 236,444,286.98 131,069,647.77 14,613,640.62 116,456,007.15
Commissioned
7,838,404.74 620,680.53 7,217,724.21 31,040,280.45 3,157,490.62 27,882,789.83
materials
Total 765,497,352.69 98,035,905.66 667,461,447.03 556,322,149.18 75,474,567.74 480,847,581.44
186
2021 Annual Report
（2）Inventory falling price reserves and reserves for impairment of contract performance costs
In RMB
Increased in current period Decreased in current period
Opening Reversed or Closing
Items
balance Accrual collected Write-off Other balance
amount
Raw materials 13,788,646.60 19,526,328.72 6,979,465.38 26,335,509.94
Good in stock 43,914,789.90 25,646,269.75 32,810,663.63 36,750,396.02
Semi-finished 14,613,640.62 37,652,098.22 17,966,993.56 34,298,745.28
Goods in transit 30,573.89 30,573.89
Commissioned
3,157,490.62 620,680.53 3,157,490.62 620,680.53
materials
Total 75,474,567.74 83,475,951.11 60,914,613.19 98,035,905.66
(3)Description of The closing balance of inventories contain the amount of borrowing costs capitalized
（4）Description of amortization amount of contract performance cost in the current period
10.Contract assets
Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of
other receivables if the provision for bad debts of contract assets is accrued according to the general model of
expected credit loss:
□ Applicable √Not applicable
Provision for impairment of contract assets in the current period
Other note
11. Assets divided as held-to-sold
Not applicable
Other note：
12. Non-current assets due within 1 year
Not applicable
Other note
13. Other current assets
In RMB
Items Year-end balance Year-beginning balance
187
2021 Annual Report
After the deduction of input VAT 860,153.70 77,482,083.47
Advance payment of income tax 57,448.91
Returns receivable costs 28,585,749.81
Total 29,503,352.42 77,482,083.47
Other note：
14.Creditor's right investment
In RMB
Year-end balance Year-beginning balance
Items Bad debt Bad debt
Book balance Book value Book balance Book value
provision provision
Not applicable
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
Other note：
15.Other creditor's rights investment
Not applicable
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
Other note
16. Long-term accounts receivable
(1) List of long-term accounts receivable
Not applicable
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
Other note
(2) Long-term accounts receivable which terminate the recognition owning to the transfer of the financial assets
(3) The amount of the assets and liabilities formed by the transfer and the continues involvement of long-term
accounts receivable
Other note
188
2021 Annual Report
17. Long-term equity investment
In RMB
Increase /decrease
Profits Closing
and Cash
Withdr balance
losses
bonus
Openin on awal of of
Investe Additio Decreas investm Other Change or Closing
g impair impair
es nal e in ents compre s in balance
profits Other
balance investm investm Recogn hensive other ment ment
ent ent ized income equity announ
provisi provisi
under ced to
the on on
equity issue
method
I. Joint ventures
Anhui
Huapen
g 10,797, 10,797,
Textile 023.14 023.14
Co.,Ltd
.
Shenzh
en
Guanhu
a 127,90 128,21
308,06
Printin 6,165.1 4,225.5
0.37
g& 7 4
Dyeing
Co.,
Ltd.
138,70 128,21
Subtota 10,797, 308,06
3,188.3 4,225.5
l 023.14 0.37
1 4
2. Affiliated Company
Shenzh
en
Changli
anfa
2,706,2 265,94 2,972,2
Printin
62.38 0.59 02.97
g&
dyeing
Compa
ny
189
2021 Annual Report
Hongko
ng
Yehui
6,519,6 -540,01 -199,06 3,944,7 1,835,8
Internat
86.54 6.30 3.73 09.25 97.26
ional
Co.,
Ltd.
Subtota 9,225,9 -274,07 -199,06 3,944,7 4,808,1
l 48.92 5.71 3.73 09.25 00.23
147,92 133,02
10,797, 33,984. -199,06 3,944,7
Total 9,137.2 2,325.7
023.14 66 3.73 09.25
3 7
Other note
18. Other equity instruments investment
In RMB
Items Year-end balance Year-beginning balance
Fuao auto parts Co., Ltd.（000030） 10,129,390.84
Shenzhen Dailishi Underwear Co., Ltd. 23,637,000.00 12,315,939.61
Union Development Group Co., Ltd. 144,109,485.84 152,469,200.00
Jintian Industry（Group）Co., Ltd.
Shenzhen Xinfang Knitting Co., Ltd. 2,227,903.00 2,227,903.00
Shenzhen South Textile Co., Ltd. 16,059,440.88 13,464,994.09
Total 186,033,829.72 190,607,427.54
Itemized disclosure of the current non - trading equity instrument investment
In RMB
Reasons for
Amount of being measured Reasons for
other at fair value other
Recognized comprehensive and whose comprehensive
Accumulating Accumulating
Name dividend income changes are income
income losses
income transferred to included in transferred to
retained other retained
earnings comprehensive earning
income
Fuao auto parts 414,007.80 1,158,325.79 1,158,325.79 Disposal
190
2021 Annual Report
Co., Ltd.
（000030）
Shenzhen
Dailishi
1,037,735.85 21,077,143.74
Underwear Co.,
Ltd.
Union
Development 208,000.00 141,509,485.84
Group Co., Ltd.
Shenzhen
Xinfang
1,703,903.00
Knitting Co.,
Ltd.
Jintian Industry
（Group）Co., 14,831,681.50
Ltd.
Shenzhen
South Textile 892,152.37 14,559,440.88
Co., Ltd.
Other note：
Note: The amount of the Company's investment in Jintian Industrial (Group) Co., Ltd. is all impaired.
As the above items are investments that the Company plans to hold for a long time for strategic purposes, the
Company designates them as financial assets measured at fair value with changes included in other
comprehensive income.
19.Other non-current financial assets
In RMB
Items Year-end balance Year-beginning balance
Financial assets measured at fair
value with changes included in 30,650,943.40 30,650,943.40
current profits and losses
Total 30,650,943.40 30,650,943.40
Other note：
20. Investment real estate
(1) Investment real estate adopted the cost measurement mode
√Applicable □ Not applicable
In RMB
191
2021 Annual Report
Construction in
Items House, Building Land use right Total
process
I. Original price
1. Balance at
261,742,940.53 261,742,940.53
period-beginning
2.Increase in the
3,028,785.00 3,028,785.00
current period
(1) Purchase 3,028,785.00 3,028,785.00
（2）Inventory\Fixed
assets\ Transferred fr
om construction in pro
gress
(3)Increased of
Enterprise
Combination
3.Decreased amount of
1,127,850.60 1,127,850.60
the period
（1）Dispose 1,127,850.60 1,127,850.60
（2）Other out
4. Balance at
263,643,874.93 263,643,874.93
period-end
II.Accumulated
amortization
1.Opening
151,170,468.61 151,170,468.61
balance
2.Increased amount of
6,986,473.75 6,986,473.75
the period
(1) Withdrawal 6,986,473.75 6,986,473.75
3.Decreased amount of
730,847.19 730,847.19
the period
（1）Dispose 730,847.19 730,847.19
（2）Other out
4. Balance at 157,426,095.17 157,426,095.17
192
2021 Annual Report
period-end
III. Impairment
provision
1. Balance at
period-beginning
2.Increased amount
of the period
(1) Withdrawal
3.Decreased amount of
the period
（1）Dispose
（2）Other out
4. Balance at
period-end
IV. Book value
1.Book value at period
106,217,779.76 106,217,779.76
-end
2.Book value at
110,572,471.92 110,572,471.92
period-beginning
(2) Investment property adopted fair value measurement mode
□Applicable√ Not applicable
(3) Investment real estate without certificate of ownership
In RMB
Items Book balance Reason
Unable to apply for warrants due to
Houses and Building 10,658,816.07
historical reasons
Other note
21. Fixed assets
In RMB
Items Year-end balance Year-beginning balance
Fixed assets 2,424,741,252.86 790,183,905.38
193
2021 Annual Report
Total 2,424,741,252.86 790,183,905.38
(1) List of fixed assets
In RMB
Houses & Machinery
Items Transportations Other equipment Total
buildings equipment
I. Original price
1.Opening balance 545,896,931.25 1,017,693,432.96 11,379,729.08 42,420,673.14 1,617,390,766.43
2.Increased
amount of the 258,765,257.28 1,535,123,033.22 3,899,262.59 12,891,530.11 1,810,679,083.20
period
(1) Purchase 1,569,521.47 29,933,637.96 1,151,689.53 2,588,556.40 35,243,405.36
(2) Transferred fr
om construction in 257,195,735.81 1,505,189,395.26 2,747,573.06 10,302,973.71 1,775,435,677.84
progress
(3)Increased of
Enterprise
Combination
3.Decreased
amount of the 2,149,210.94 4,933,091.35 7,082,302.29
period
（1）Disposal 2,149,210.94 4,933,091.35 7,082,302.29
4. Balance at
804,662,188.53 2,550,667,255.24 15,278,991.67 50,379,111.90 3,420,987,547.34
period-end
II. Accumulated
depreciation
1.Opening balance 159,918,391.99 630,517,504.87 3,217,030.86 27,084,284.60 820,737,212.32
2.Increased
amount of the 23,052,994.89 147,538,129.77 1,144,752.53 3,394,343.06 175,130,220.25
period
(1)
23,052,994.89 147,538,129.77 1,144,752.53 3,394,343.06 175,130,220.25
Withdrawal
3.Decrease in
1,608,147.10 4,407,313.58 6,015,460.68
the reporting
194
2021 Annual Report
period
（1）Disposal 1,608,147.10 4,407,313.58 6,015,460.68
4.Closing balance 182,971,386.88 776,447,487.54 4,361,783.39 26,071,314.08 989,851,971.89
III. Impairment
provision
1.Opening balance 6,373,080.81 96,567.92 6,469,648.73
2.Increase in the
32,769.22 32,769.22
reporting period
（1）Withdrawal 32,769.22 32,769.22
3.Decrease in
the reporting 11,527.44 96,567.92 108,095.36
period
（1）Disposal 11,527.44 96,567.92 108,095.36
（2）Other
decrease
4. Closing balance 6,361,553.37 32,769.22 6,394,322.59
IV. Book value
1.Book value of
621,690,801.65 1,767,858,214.33 10,917,208.28 24,275,028.60 2,424,741,252.86
the period-end
2.Book value of
385,978,539.26 380,802,847.28 8,162,698.22 15,239,820.62 790,183,905.38
the period-begin
(2) Fixed assets temporarily idled
In RMB
Accumulated Impairment
Items Original price Book value Remark
depreciation provision
⑶Fixed assets leased out through operating leases
In RMB
Items Book value
(4) Fixed assets without certificate of title completed
In RMB
195
2021 Annual Report
Items Book Value Reason
Unable to apply for warrants due to
Houses and Building 275,225,966.28
historical reasons
Other note
（5）Liquidation of fixed assets
In RMB
Items Year-end balance Year-beginning balance
Other note
22. Construction in progress
In RMB
Items Year-end balance Year-beginning balance
Construction in progress 71,482,031.08 1,301,750,141.12
Total 71,482,031.08 1,301,750,141.12
(1) List of construction in progress
In RMB
Year-end balance Year-beginning balance
Items Book balance Provision for Book value Book balance Provision for Book value
devaluation devaluation
Industrializatio
n project of
polaroid for 1,301,693,689. 1,301,693,689.
super large size 12 12
TV
(Line 7)
Other 56,452.00 56,452.00
Installation of
machines and 71,482,031.08 71,482,031.08
equipment
1,301,750,141. 1,301,750,141.
Total 71,482,031.08 71,482,031.08
12 12
196
2021 Annual Report
（2）Changes of significant construction in progress
In RMB
Includi
Capital ng：
isation Curren
Capital
Amou Transf of t
Increas Balanc isation
nt at erred Other Propor Progre interes amoun Source
e at e in of
Name Budget year to decrea tion(% ss of t t of of
this year-e interes
beginn fixed se ) work accum capital funds
period nd t ratio
ing assets ulated ization
（%)
balanc of
e interes
t
Industr
ializati
on Invest
project ment
of in
Polaro 2,106, 1,301, 468,84 1,770, fixed 13,747
99.26 9,807,
id for 698,40 693,68 4,861. 538,55 assets ,732.5 4.41% Other
% 167.26
super 0.00 9.12 20 0.32 has 5
large been
size transfe
TV rred
(Line
7)
2,106, 1,301, 468,84 1,770, 13,747
9,807,
Total 698,40 693,68 4,861. 538,55 -- -- ,732.5 4.41% --
167.26
0.00 9.12 20 0.32 5
（3）Impairment provision of construction projects
Not applicable
Other note
（4）Engineering material
In RMB
Year-end balance Year-beginning balance
Items Book balance Provision for Book value Book balance Provision for Book value
devaluation devaluation
Other note：
197
2021 Annual Report
23. Productive biological assets
(1) Productive biological assets measured at cost methods
□ Applicable √ Not applicable
(2) Productive biological assets measured at fair value
□ Applicable √ Not applicable
24. Oil and gas assets
□ Applicable √ Not applicable
25. Right to use assets
In RMB
Items Total
1. Balance at year beginning 13,762,176.74 13,762,176.74
4. Year-end balance 13,762,176.74 13,762,176.74
2. Increase at this period 4,540,987.37 4,540,987.37
4. Year-end balance 4,540,987.37 4,540,987.37
1.Book value 9,221,189.37 9,221,189.37
Other note：
None
26. Intangible assets
(1) Information
In RMB
Non-proprietary
Items Land use right Patent right Software Total
technology
I. Original price
1. Balance at
48,258,239.00 11,825,200.00 4,079,953.70 64,163,392.70
period-beginning
2.Increase in the
17,616,287.32 17,616,287.32
current period
(1) Purchase 17,616,287.32 17,616,287.32
（2）Internal R &
D
（3）Increased of
Enterprise
198
2021 Annual Report
Combination
3.Decreased
amount of the
period
（1）Disposal
4. Balance at
48,258,239.00 11,825,200.00 21,696,241.02 81,779,680.02
period-end
II.Accumulated
amortization
1. Balance at
13,487,191.27 11,825,200.00 2,802,022.52 28,114,413.79
period-beginning
2. Increase in the
895,391.76 4,134,714.47 5,030,106.23
current period
(1) Withdrawal 895,391.76 4,134,714.47 5,030,106.23
3.Decreased
amount of the
period
（1）Disposal
4. Balance at
14,382,583.03 11,825,200.00 6,936,736.99 33,144,520.02
period-end
III. Impairment
provision
1. Balance at
period-beginning
2. Increase in the
current period
(1) Withdrawal
3.Decreased
amount of the
period
（1）Disposal
199
2021 Annual Report
4. Balance at
period-end
4. Book value
1.Book value at
33,875,655.97 0.00 14,759,504.03 48,635,160.00
period -end
2.Book value at
34,771,047.73 0.00 1,277,931.18 36,048,978.91
period-beginning
The proportion the intangible assets formed from the internal R&D through the Company amount the balance of
the intangible assets at the period-end.
(2) Details of fixed assets failed to accomplish certification of land use right
In RMB
Items Book value Reason
Other note：
For intangible assets mortgaged by bank loans, please refer to VII Notes to consolidated financial statements "81.
Assets with restricted ownership or use rights".
27. .Development expenses
In RMB
Increase in this period Decrease in this period
Internal
Recognize Transfer to
Balance in developme Balance in
Items d as current
year-begin nt Other year-end
intangible profit and
expenditur
assets loss
e
Total
Other note
28. Goodwill
(1) Original book value of goodwill
In RMB
Name of the Increase Decrease
investees or the Opening Closing
The merger of
events formed balance disposition balance
enterprises
goodwill
SAPO 9,614,758.55 9,614,758.55
200
2021 Annual Report
Photoelectric
Shenzhen
Beauty Century
2,167,341.21 2,167,341.21
Garment Co.,
Ltd.
Total 11,782,099.76 11,782,099.76
（2）Impairment of goodwill
In RMB
Balance in Increased at this period .Decreased at this period Closing
Investee
year-begin balance
Provision disposition
SAPO
9,614,758.55 9,614,758.55
Photoelectric
Shenzhen
Beauty Century
2,167,341.21 2,167,341.21
Garment Co.,
Ltd.
Total 11,782,099.76 11,782,099.76
Information about an asset group or asset group portfolio
Explain the goodwill impairment test process, key parameters (such as forecast period growth rate at expected
future cash flow, stable period growth rate, profit margin, discount rate, forecast period, etc.) and the confirmation
method of goodwill impairment loss
Impact of the goodwill impairment test
Other note
29. Long term amortize expenses
In RMB
Amortized
Balance in Increase in this Balance in
Items expenses Other loss
year-begin period year-end
Decoration fee 111,541.85 409,932.91 188,830.66 332,644.10
Renovation fee 1,264,954.74 3,224,534.02 714,221.68 3,775,267.08
Other 1,500,064.94 47,430.80 268,110.98 1,279,384.76
201
2021 Annual Report
Total 2,876,561.53 3,681,897.73 1,171,163.32 5,387,295.94
Other note
None
30. Deferred income tax assets/deferred income tax liabilities
（1）Details of the un-recognized deferred income tax assets
In RMB
Balance in year-end Balance in year-begin
Items
Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Assets depreciation
5,766,782.71 1,440,192.90 18,865,669.84 4,709,761.70
reserves
Unattained internal
2,324,192.50 348,628.88 2,413,307.05 361,996.06
sales profits
Restricted stock
686,670.00 171,667.50
repurchase interest
Salary payable to staff 7,679,100.00 1,919,775.00
Total 15,770,075.21 3,708,596.78 21,965,646.89 5,243,425.26
(2)Details of the un-recognized deferred income tax liabilities
In RMB
Closing balance Opening balance
Items Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference liabilities difference liabilities
Changes in fair value
of investments in other 178,849,973.46 44,712,493.37 174,482,972.97 43,620,743.24
equity instruments
The difference between
the initial recognition
cost and tax base of
62,083,693.36 15,520,923.34 62,083,693.36 15,520,923.34
long-term equity
investment of Guanhua
Company
Difference in rent
5,636,976.78 1,409,244.20
receivable
Total 246,570,643.60 61,642,660.91 236,566,666.33 59,141,666.58
202
2021 Annual Report
(3) Deferred income tax assets or liabilities listed by net amount after off-set
In RMB
End balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Items deferred income tax
assets or liabilities assets and liabilities at assets or liabilities
assets and liabilities
after off-set period-begin after off-set
Deferred income tax
3,708,596.78 5,243,425.26
assets
Deferred income tax
61,642,660.91 59,141,666.58
liabilities
(4)Details of income tax assets not recognized
In RMB
Items Balance in year-end Balance in year-begin
Deductible temporary difference 151,027,647.77 122,887,462.20
Deductible loss 736,209,989.47 682,013,840.25
Total 887,237,637.24 804,901,302.45
(5)Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
Year Balance in year-end Balance in year-begin Remark
2023 129,226,944.33 129,226,944.33
2024 148,095,898.11 148,095,898.11
2025 83,287,153.64 83,287,153.64
2026 120,820,767.06 120,820,767.06
2028 22,594,586.97 22,594,586.97
2029 100,351,965.47 100,351,965.47
2030 77,636,524.67 77,636,524.67
2031 54,196,149.22
Total 736,209,989.47 682,013,840.25 --
Other note：
None
31 .Other non-current assets
In RMB
203
2021 Annual Report
Balance in year-end Balance in year-begin
Items Book Provision Book value Book Provision Book value
balance for balance for
devaluation devaluation
28,769,782 28,769,782 47,483,219 47,483,219
Advance payment for equipment fund 0.00 0.00
.86 .86 .83 .83
Certificate of deposit for more than 1 30,030,410 30,030,410 70,064,383 70,064,383
0.00 0.00
year .96 .96 .56 .56
25,760,086 25,760,086 25,760,086 25,760,086
Shenzhen Xieli Automobile Co., ltd. 0.00 0.00
.27 .27 .27 .27
84,560,280 84,560,280 143,307,68 143,307,68
Total 0.00 0.00
.09 .09 9.66 9.66
Other note：
None
32. Short-term borrowings
（1）Categories of short-term loans
In RMB
Items Balance in year-end Balance Year-beginning
Note：
(2) Situation of Overdue Outstanding Short-Term Borrowing
Not applicable
Other note：
33. Transactional financial liabilities
In RMB
Items Balance in year-end Balance year-beginning
Including：
Including：
Other note：
34. Derivative financial liability
In RMB
Items Balance in year-end Balance year-beginning
204
2021 Annual Report
Other note：
35.Notes payable
In RMB
Type Balance in year-end Balance in year-begin
Bank acceptance Bill 16,682,324.12 0.00
Total 16,682,324.12
The total note payable not due at the end of the period is 0.00 yuan.
36. Accounts payable
(1) List of accounts payable
In RMB
Items Balance in year-end Balance in year-begin
Within 1 year 280,210,281.65 325,354,275.46
1-2 years 1,122,451.76 1,912,000.86
2-3 years 496,309.68 96,543.25
3-4 years 44,629.53 1,093,369.87
4-5 years 983,598.33 37,402.40
Over 5 years 786,571.28 975,010.06
Total 283,643,842.23 329,468,601.90
(2) Significant advance from customers aging over one year
In RMB
Items Balance in year-end Reason
Other note：
None
37.Advance account
(1) List of Advance account
In RMB
Items Balance in year-end Balance in year-begin
Within 1 year 968,394.67 666,457.75
1-2 years 197,892.32 2,236,912.00
2-3 years
205
2021 Annual Report
Over 3 years 639,024.58 639,024.58
Total 1,805,311.57 3,542,394.33
(2) Significant advance from customers aging over one year
In RMB
Items Balance in year-end Reason
38.Contract liabilities
In RMB
Items Balance in year-end Balance in year-begin
Good 68,955.21 279,631.27
Less ： Contractual liabilities charged to
other non-current liabilities
Total 68,955.21 279,631.27
Amount and reasons for the significant change in the book value during the reporting period
In RMB
Items Amount Reason
39.Payable Employee wage
(1) List of Payroll payable
In RMB
Items Balance in year-begin Increase in this period Payable in this period Balance in year-end
I. Short-term
55,642,549.53 235,951,646.92 231,874,336.21 59,719,860.24
compensation
II.Post-employment be
nefits - defined contrib 15,705,799.59 15,705,799.59
ution plans
III. Dismissal benefits 2,636,463.20 2,636,463.20
Total 55,642,549.53 254,293,909.71 250,216,599.00 59,719,860.24
（2）Short-term remuneration
In RMB
Items Balance in year-begin Increase in this period Decrease in this period Balance in year-end
1.Wages, bonuses,
53,293,551.94 211,994,691.05 208,173,934.97 57,114,308.03
allowances and
206
2021 Annual Report
subsidies
2.Employee welfare 41,093.20 8,393,472.90 8,434,566.10
3. Social insurance
2,723,153.85 2,723,153.85
premiums
Including：Medical
2,254,940.97 2,254,940.97
insurance
Work injury insurance 175,636.12 175,636.12
Maternity insurance 292,576.76 292,576.76
4. Public reserves for
7,339,217.34 7,339,217.34
housing
5.Union funds and
2,307,904.39 5,501,111.78 5,203,463.95 2,605,552.21
staff education fee
Total 55,642,549.53 235,951,646.92 231,874,336.21 59,719,860.24
（3）Defined contribution plans listed
In RMB
Items Balance in year-begin Increase in this period Decrease in this period Balance in year-end
1. Basic old-age
13,082,445.90 13,082,445.90
insurance premiums
2.Unemployment
278,249.09 278,249.09
insurance
3. Annuity payment 2,345,104.60 2,345,104.60
Total 15,705,799.59 15,705,799.59
Other note：
None
40.Tax Payable
In RMB
Items Balance in year-end Balance in year-begin
VAT 6,334,093.50 286,928.75
Enterprise Income tax 1,804,277.95 11,219,726.43
Individual Income tax 866,274.38 469,169.71
City Construction tax 43,259.90 48,751.30
House property tax 102,146.02 102,146.02
Education surcharge 31,608.85 33,386.49
207
2021 Annual Report
Stamp tax 18,966.49 36,370.02
Land use tax 0.00 2,043.30
Total 9,200,627.09 12,198,522.02
Other note：
None
41.Other payable
In RMB
Items Balance in year-end Balance in year-begin
Other payable 201,317,421.35 156,118,440.42
Total 201,317,421.35 156,118,440.42
（1）Interest payable
Not applicable
Other note：
（2）Dividends payable
In RMB
Items Balance in year-end Balance Year-beginning
(3) Other accounts payable
(1) Other accounts payable listed by nature of the account
In RMB
Items Balance in year-end Balance in year-begin
Engineering Equipment fund 91,213,156.89 32,713,413.76
Unit account 51,681,042.57 48,394,939.72
Deposit 43,277,481.38 36,130,306.12
Restrictive stock repurchase obligation 0.00 7,844,373.00
Other 15,145,740.51 31,035,407.82
Total 201,317,421.35 156,118,440.42
208
2021 Annual Report
(2) Other significant accounts payable with aging over one year
In RMB
Items Balance in year-end Reason
Other note
None
42. Liabilities classified as holding for sale
In RMB
Items Balance in year-end Balance in year-begin
Other note：
43. Non-current liabilities due within 1 year
In RMB
Items Balance in year-end Balance in year-begin
Lease liabilities due within one year 5,175,393.52 0.00
Total 5,175,393.52
Other note：
None
44.Other current liabilities
In RMB
Items Balance in year-end Balance in year-begin
Did not terminate the confirmation bill
27,523,903.58 0.00
endorsement, discount
Total 27,523,903.58
Other note：
None
45. Long-term borrowing
(1) List of Long-term borrowing
In RMB
Items Balance in year-end Balance in year-begin
Mortgage-guaranteed loan 683,016,243.25 343,100,174.35
Less：Long-term borrowings due within 0.00 0.00
209
2021 Annual Report
1 year
Total 683,016,243.25 343,100,174.35
Description of the long-term loan classification
Other note,
46.Bond payable
（1）Bond payable
In RMB
Items Balance year-end Year-beginning balance
（ 2 ） Changes of bonds payable(Not including the other financial instrument of preferred stock and perpetual
capital securities that classify as financial liability
In RMB
Overflo
Withdr
Name Openin The w Pay in
Book Issue Issue aw Closing
of the Period g current discoun current
value date amount interest balance
bond balance issue t period
at par
amount
Total -- -- --
(3) Note to conditions and time of share transfer of convertible bonds
（4）Other financial instruments that are classified as financial liabilities
Basic situation of other financial instruments outstanding at the period-end such preferred shares and perpetual
bonds
Changes in financial instruments outstanding at the period-end such preferred shares and perpetual liabilities
Other note
47. Lease liabilities
In RMB
Items Balance year-end Year-beginning balance
lease liabilities 9,419,249.23
Less：Lease liabilities due within 1 year -5,175,393.52
Total 4,243,855.71
Other note
210
2021 Annual Report
The accrued interest expense of lease liabilities in 2021 is RMB 475,000, which is included in the financial
expense-interest expense.
48. Long-term payable
In RMB
Items Balance year-end Year-beginning balance
（1）Statement of long-term payroll payable
In RMB
Items Balance year-end Year-beginning balance
Other note：
（2）Special payable
In RMB
Year-beginning
Items Increase Decrease Balance year-end Reason
balance
Other note：
49. Long term payroll payable
（1）Statement of long-term payroll payable
Not applicable
（2）Change of defined benefit plans
Not applicable
Other note：
50.Estimated liabilities
In RMB
Items Balance in year-end Balance in year-begin Reason
Repayment payable 30,741,055.00
Total 30,741,055.00 --
Other note：
211
2021 Annual Report
51.Deferred income
In RMB
Decreased this
Items Beginning of term Increased this term End of term Reason
term
Government
110,740,322.21 13,660,000.00 13,939,029.06 110,461,293.15
Subsidy
Total 110,740,322.21 13,660,000.00 13,939,029.06 110,461,293.15 --
Details of government subsidies：
In RMB
Amount Other income Amount of Asset-related
New subsidy
Beginning of transferred to recorded in cost deducted Other or
Items in current End of term
term non-operatio the current in the current changes income-relate
period
nal income period period d
Other note：
For details of government subsidies included in deferred revenue, please refer to Note XIV. 2. Government
subsidies.
52. . Other non-current liabilities
In RMB
Items Balance year-end Year-beginning balance
Other note：
53.Stock capital
In RMB
Changed（+，-）
Year-beginni Balance in
Issuance of Capitalizatio
ng balance Bonus shares Other Subtotal year-end
new share n of public
reserve
Total of 507,772,279. -1,250,430.0 -1,250,430.0 506,521,849.
capital shares 00 0 0 00
Other note：
Note: This year, 1,250,430.00 restricted shares that have been granted but not yet unlocked were repurchased and
cancelled, with a reduction of RMB 1,250,430.00, which has been verified by Peking Certified Public
Accountants (special general partnership), and the capital verification report (QXY Zi (2021) No.0013) was issued
212
2021 Annual Report
on April 27, 2021.
54. Other equity instruments
(1) Basic information on the outstanding other financial instruments, including preferred shares, perpetual bonds,
etc. at the end of the reporting period
(2)Movement of the outstanding other financial instruments, including preferred shares, perpetual bonds, etc. at
the end of the reporting period
Other note：
55. Capital reserves
In RMB
Items Year-beginning Increase in the current Decrease in the current Year-end balance
balance period period
Share premium 1,832,397,142.44 5,914,533.90 1,826,482,608.54
Other capital reserves 135,117,216.09 135,117,216.09
Total 1,967,514,358.53 5,914,533.90 1,961,599,824.63
Other notes, including the note to its increase/decrease and the cause(s) of its movement in the reporting period:
The change of capital stock premium in the current period is from the repurchase and cancellation of some
restricted stocks granted by the Company's restricted stock incentive plan in 2017.
56.Treasury stock
In RMB
Year-beginning Decrease in the current
Items Increase in the current Year-end balance
balance period
Treasury stock 7,525,438.20 7,525,438.20 0.00
Total 7,525,438.20 7,525,438.20
Other notes, including the note to its increase/decrease and the cause(s) of its movement in the reporting period:
The change of capital stock premium in the current period is from the repurchase and cancellation of some
restricted stocks granted by the Company's restricted stock incentive plan in 2017.
57. Other comprehensive income
In RMB
Amount of current period Year-e
Year-begi
Items nd
nning Amount Less： Less： Less： After-ta After-ta
balanc
213
2021 Annual Report
balance incurred Amount Prior Income x x e
before transferred period tax attribute attribute
income into profit included expense to the to
tax and loss in in other s parent minority
the current composi compan sharehol
period that te y der
recognied income
into other transfer
comprehen to
sive retained
income in income
prior in the
period current
period
1. Other comprehensive income 118,64
115,367,8 3,237,34 -847,23 809,337. 3,275,25
that cannot be reclassified in the 3,084.
33.87 9.34 8.36 34 0.36
loss and gain in the future 23
Changes in fair value of 118,64
115,367,8 3,237,34 -847,23 809,337. 3,275,25
investments in other equity 3,084.
33.87 9.34 8.36 34 0.36
instruments 23
2.Other comprehensive income
1,238,098 -199,06 -199,06 1,039,
reclassifiable to profit or loss in
.55 3.73 3.73 034.82
subsequent periods
Translation differences of
1,238,098 -199,06 -199,06 1,039,
financial statements
.55 3.73 3.73 034.82
denominated
Total of other comprehensive 119,68
116,605,9 3,038,28 -847,23 809,337. 3,076,18
income 2,119.
32.42 5.61 8.36 34 6.63
05
Other notes include the valid part of gain and loss of a cash-flow hedge converted into initial amount of arbitraged
items for adjustment: None
58. Special reserves
In RMB
Items Year-beginning Increase in the current Decrease in the current Year-end balance
balance period period
59. Surplus reserves
In RMB
214
2021 Annual Report
Items Year-beginning Increase in the current Decrease in the current Year-end balance
balance period period
Statutory surplus
94,954,652.14 3,291,193.33 98,245,845.47
reserve
Total 94,954,652.14 3,291,193.33 98,245,845.47
Note to surplus reserve, including the note to its increase/decrease and the cause(s) of its movement in the
reporting period:
Note: The increase amount in the current period is RMB 3,291,193.33, including RMB 3,175,360.75 accrued
according to 10% of the current net profit and RMB 115,832.57 accrued from other comprehensive income
carry-over retained earnings.
60. Retained profits
In RMB
Items Amount of current period Amount of previous period
Retained earnings before adjustments at the year
86,912,390.50 49,307,764.03
beginning
Retained earnings after adjustments at the year
86,912,390.50 49,307,764.03
end
Add: Net profit attributable to owners of the
61,162,384.25 37,267,995.74
Company for the period
Less: Appropriation to statutory surplus reserve 3,175,360.75 3,888,292.80
Common stock dividend payable 15,195,655.47
Add：Other comprehensive earnings are carried
1,042,493.21 4,224,923.53
forward to retained earnings
Retained profits at the period end 130,746,251.74 86,912,390.50
As regards the details of adjusted the beginning undistributed profits
(1)As the retroactive adjustment on Enterprise Accounting Standards and its related new regulations, the affected
beginning undistributed profits are RMB 0.00.
(2) As the change of the accounting policy, the affected beginning undistributed profits are RMB 0.00.
(3) As the correction of significant accounting error, the affected beginning undistributed profits are RMB 0.00 .
(4) As the change of consolidation scope caused by the same control, the affected beginning undistributed profits
are RMB 0.00.
(5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 .
215
2021 Annual Report
61. Business income, Business cost
In RMB
Amount of current period Amount of previous period
Items
Income Cost Income Cost
Main business 2,265,990,629.90 1,900,247,328.79 2,097,432,885.06 1,808,092,705.48
Other business 27,757,262.16 8,272,084.49 11,531,802.74 6,205,689.54
Total 2,293,747,892.06 1,908,519,413.28 2,108,964,687.80 1,814,298,395.02
Whether the net profit before and after deducting non-recurring gains and losses is negative after audit
□ Yes √ No
Income-related information:
In RMB
Type Division 1 Division 2 Total
Of which
Property lease
management and 111,568,500.55 139,325,762.71
others
Textile 54,932,578.58 54,932,578.58
Polarizer 2,099,489,550.77 2,099,489,550.77
Of which
Domestic 2,039,625,757.16 2,039,625,757.16
Overseas 254,122,134.90 254,122,134.90
Of which
Of which
Of which
Of which
Of which
Information related to performance obligations: None
Information related to the transaction price apportioned to the residual performance obligation:
The income corresponding to the performance obligations that have not been performed or have been performed
incompletely but the contract has been signed at the end of the reporting period is RMB 0.00, of which RMB 0.00
is expected to be recognized as income in the year, RMB 0.00 is expected to be recognized as income in the year,
and RMB 0.00 is expected to be recognized as income in the year.
Other note:
216
2021 Annual Report
62.Taxes and surcharges
In RMB
Items Amount of current period Amount of previous period
Urban construction tax 1,625,005.70 718,695.23
Education surcharge 1,169,628.61 517,483.70
Property tax 5,826,834.91 4,338,584.18
Other 1,902,078.87 1,772,362.54
Total 10,523,548.09 7,347,125.65
Other note：
63.Sales expenses
In RMB
Items Amount of current period Amount of previous period
Wage 18,266,837.81 12,958,215.67
Business expenses 1,256,926.46 668,407.23
Sales service 12,684,139.28 12,697,476.62
Property insurance 2,716,981.13
Other 3,048,451.71 2,320,131.35
Total 37,973,336.39 28,644,230.87
Other note：
None
64. Administrative expenses
In RMB
Items Amount of current period Amount of previous period
Wage 80,805,949.97 74,790,949.11
Depreciation of fixed assets 10,728,532.58 9,794,203.66
Water and electricity 2,123,594.28 2,576,447.96
Intermediary organ 8,120,482.28 3,271,775.61
Intangible assets amortization 5,030,106.23 1,612,363.59
Travel expenses 468,553.20 408,221.21
Office expenses 1,192,408.92 946,055.89
Business entertainment 1,754,789.06 615,454.09
Lawsuit expenses 914,353.81 144,161.32
217
2021 Annual Report
Repair charge 2,057,702.25 1,366,609.60
Property insurance 648,821.25 380,689.81
Other 8,243,536.32 9,188,002.51
Total 122,088,830.15 105,094,934.36
Other note：
None
65.R & D costs
In RMB
Items Amount of current period Amount of previous period
Wage 15,697,764.59 13,177,489.03
Material 83,197,051.56 49,679,847.18
Depreciation 3,326,098.79 2,984,978.79
Fuel & Power 976,547.62 1,017,795.21
Travel expenses 177,340.24 226,949.44
Other 133,961.73 73,904.57
Total 103,508,764.53 67,160,964.22
Other note:
None
66.Financial Expenses
In RMB
Items Amount of current period Amount of previous period
Interest expenses 24,113,442.39 4,175,380.96
Less：Interest capitalized 9,807,167.26 3,940,565.29
Interest income -1,655,853.59 -3,702,735.59
Exchange loss -20,976,430.83 8,108,404.80
Discount interest on acceptance bill 1,390,467.41 0.00
Fees and other 6,805,197.79 3,647,403.40
Total -130,344.09 8,287,888.28
Other note：
None
218
2021 Annual Report
67.Other income
In RMB
Items Amount of current period Amount of previous period
Amortization for subsidies for new
production lines and purchase of
3,000,000.00 3,000,000.00
equipment for the Phase II project of
polarizers for TFT-LCD
Amortization of funds for the pilot
project of regional agglomeration
2,500,000.08 2,500,000.00
development of strategic emerging
industries in Guangdong Province
Amortization of local matching funds for
the second phase of TFT-LCD polarizer 1,500,000.00 1,500,000.00
project (Line 6)
Amortization of subsidy funds for
industrialization project of polarizers for 1,299,999.96 1,300,000.00
TFT-LCD
Shenzhen Municipal Finance
Committee’s polarizer industrialization 1,250,000.00 0.00
project for super-sized TVs
Amortization of national subsidy for
TFT-LCD polarizer phase II project 1,000,000.00 1,000,000.00
(Line 6)
Amortization of subsidy funds for the
narrow line (Line 5) of the first-phase 500,000.04 500,000.00
project of polarizer for TFT-LCD
Amortization of Shenzhen Polarizing
Materials and Technology Engineering 500,000.00 500,000.00
Laboratory
Amortization of subsidy funds for R&D
equipment for key technologies of 500,000.04 500,000.00
optical compensation films for polarizers
Shenzhen Municipal Air Environment
Quality Improvement Special Fund 494,931.57 468,931.57
Subsidy
2021 Special Major Project Award and
Subsidy Support Plan for Technological 367,666.68 0.00
Transformation and Doubling
Amortization of funding for technology
300,000.00 300,000.00
center construction
219
2021 Annual Report
Amortization of subsidies for purchase
175,090.20 175,090.20
of imported equipment and technology
Amortization of special funds for textiles 142,857.16 142,857.16
Amortization of capital subsidy for
142,255.72 142,255.72
change & renovation of old elevators
Amortization of innovative and
entrepreneurial funds for the first phase 50,000.04 50,000.00
of the TFT-LCD polarizer project
Amortization of innovation and
entrepreneurship funds of Shenzhen
50,000.04 50,000.00
Polarizing Materials and Technology
Engineering Laboratory
Amortization of innovative and
entrepreneurial funds for the second
50,000.04 50,000.00
phase of the TFT-LCD polarizer project
(Line 6)
Dyeing project technical transformation
39,000.00 0.00
subsidy
Amortization of energy-saving
27,172.70 29,642.93
renovation subsidy funds
Subsidies for investment projects in
special technological transformation and
19,000.00 11,083.33
doubling for technological
transformation in 2020
Funding for key technology research and
development of polarizers for ultra-thin 16,666.67 0.00
IPS smartphone terminals
Amortization of Funds for Introducing
14,388.12 14,388.10
Advanced Technology
Shenzhen Bureau of Industry and
Information Technology's 2021
2,590,000.00 0.00
Industrial Enterprises Expansion
Capacity Incentive Project Subsidy
Shenzhen Science and Technology
Innovation Committee 2020 Enterprise 1,018,000.00 0.00
R&D Subsidy
Headquarters Economic Comprehensive
Economic Contribution Award (Futian 500,000.00 0.00
District Enterprise Development Center)
Shenzhen Pingshan District Finance 500,000.00 0.00
220
2021 Annual Report
Bureau 2019 Pingshan District
Harmonious Labor Relations Enterprise
Award Fund
The second batch of funding of the 2020
Science and Technology Innovation
Special Fund of Shenzhen Pingshan 360,000.00 0.00
District Finance Bureau (standardized
funding)
The second batch of special funds of
scientific and technological innovation
in 2020 of Shenzhen Pingshan District 300,000.00 0.00
Finance Bureau (High-tech Enterprise
Recognition Award)
Stable Job Subsidy 118,832.69 160,712.86
Municipal Ecological Environment
Bureau Cleaner Production Incentive 100,000.00 0.00
Support Subsidy
The sixth batch of pre-job training
subsidies by Longgang District of 68,000.00 0.00
Human Resources Bureau
Shenzhen Pingshan District Human
Resources Bureau’s one-time subsidy for
60,000.00 0.00
enterprises to absorb and file poor
laborers
Received subsidy from Longgang
District Human Resources Bureau for 27,000.00 0.00
work-for-training
Subsidy from Shenzhen Futian District
Human Resources Bureau for 16,500.00 0.00
work-for-work training
Subsidy from Luohu district for
15,500.00 0.00
work-for-work training
Employee maternity benefits returned by
10,592.53 32,609.51
Social Security Administration
Unpaid VAT (input plus deduction) 9,899.54 0.00
The second batch of special funds for
scientific and technological innovation
by Shenzhen Pingshan District Finance 4,800.00 0.00
Bureau in 2020 (Intellectual Property
Award)
221
2021 Annual Report
Tax office fee refund 5,225.51 24,898.73
Sewage fee refund 0.00 597,362.55
Shenzhen Industrial and Commercial
0.00 6,952,943.71
Electricity Cost Reduction Subsidy
Social Security Administration premium
0.00 1,815.00
refund
Pingshan District Finance Bureau's
759.00
Second Batch of Epidemic Subsidies
2019 Water-saving Carrier Award Fund
374,102.00
of Shenzhen Water Affairs Bureau
Shenzhen Pingshan District Finance
Bureau 2018 Harmonious Labor 1,000,000.00
Relations Enterprise Award Fund
Shenzhen Science and Technology
Innovation Committee 2018 Enterprise 1,278,000.00
R&D Subsidy
Pingshan District Science and
Technology Innovation Bureau's 2019 50,000.00
High-tech Enterprise Recognition Award
Pingshan District Subsidy for
1,645,500.00
Work-for-Training
Shenzhen Pingshan District Human
111,600.00
Resources Bureau trial training subsidy
Shenzhen Pingshan District Finance
Bureau subsidy support for the steady
1,200,000.00
growth of foreign trade in Pingshan
District in 2020
Received refund of unemployment
benefits for companies affected by the
2,709,874.84
epidemic from the Social Security
Bureau
Market Supervision Administration's
Second Batch of Patent Subsidies in 9,000.00
2018
Government subsidizes for epidemic
10,000.00
protective supplies
Cultural Tourism Stabilization Support
100,000.00
Subsidy
The first batch of special funds for 966,000.00
222
2021 Annual Report
scientific and technological innovation
in 2019
Received subsidies from the Public
Employment Service Center for 1,425.20
stabilizing jobs
Received the reward for the epidemic
prevention effect from the Bureau of 20,000.00
Industry and Information Technology
Received subsidy for housing epidemic
prevention at 145# Fenghuang Road
5,638.00
from Shenzhen Luohu District Housing
and Construction Bureau
Received the epidemic prevention
subsidy for Shenzhen No. 52 Textile
Compound, Tianbei 2nd Road from the 8,531.45
Housing and Construction Bureau of
Luohu District Shenzhen
Urban construction tax and surcharges
1,047.51
halved
Stamp duty halved 183.32
Luohu District Epidemic Prevention
10,000.00
Subsidy
68. Investment income
In RMB
Items Amount of this period Amount of last period
Long-term equity investment returns
33,984.66 -3,446,613.86
accounted for by equity method
Investment income from the disposal of
20,779.93 0.00
long-term equity investment
Dividend income earned during investment
2,551,896.02 2,946,592.79
holdings in other equity instruments
Structured deposit interest 2,749,600.18 18,231,107.84
Interest income on term deposits over 1 year 2,350,000.00 853,205.47
Net monetary gains 14,956,752.27 4,015,378.50
Total 22,663,013.06 22,599,670.74
Other note：
None
223
2021 Annual Report
69.Net exposure hedging income
In RMB
Items Amount of this period Amount of last period
Other note：
70. Gains on the changes in the fair value
In RMB
Source Amount of this period Amount of last period
Transaction financial assets 536,575.34
Other non-current financial assets 2,150,943.40 2,150,943.40
Total 2,150,943.40 2,687,518.74
Other note：
None
71. Credit impairment loss
In RMB
Items Amount of this period Amount of last period
Loss of bad debts in other receivables -7,201,148.60 -1,828,410.68
Loss of bad note receivable -280,565.00 -84,490.74
Loss of bad accounts receivable 2,500,153.07 -8,481,632.23
Total -4,981,560.53 -10,394,533.65
Other note：
72. Losses from asset impairment
In RMB
Items Amount of current period Amount of previous period
II. Loss of inventory price and
Impairment of contract performance -83,475,951.11 -65,942,828.90
costs
V. Impairment loss of fixed assets -32,769.22 -6,469,648.73
Total -83,508,720.33 -72,412,477.63
Other note：
73. Asset disposal income
224
2021 Annual Report
In RMB
Items Amount of current period Amount of previous period
I. Gains & losses on foreign investment
-597,458.77 276,544.73
in fixed assets
74. Non-Operation income
In RMB
Items Amount of current period Amount of previous period Recorded in the amount of
the non-recurring gains and
losses
Insurance compensation 3,477,438.60 3,477,438.60
Payable without payment 1,371,678.99
Liquidation profit and loss 17,140,459.60 17,140,459.60
Other 667,888.44 73,983.39 667,888.44
Total 21,285,786.64 1,445,662.38
Government subsidies recorded into current profits and losses：
In RMB
Whether the
impact of
Whether Amount of Amount of Assets-relate
Issuing subsidies on
Items Issuing body Nature special current previous d/income-rela
reason the current
subsidies period period ted
profit and
loss
Other note：
75.Non-current expenses
In RMB
Amount of current period Amount of previous period The amount of non-operating
Items
gains & lossed
Non-current asset Disposition
369,187.12 3,315.15 369,187.12
loss
Fine expenses 1,309,172.27 115,314.20 1,309,172.27
Other 7,903.96 19,791.92 7,903.96
Total 1,686,263.35 138,421.27
Other note：
225
2021 Annual Report
76.Income tax expenses
(1)Income tax expenses
In RMB
Items Amount of current period Amount of previous period
Current income tax expense 8,174,724.28 8,422,038.43
Deferred income tax expense 2,944,072.68 -218,317.45
Total 11,118,796.96 8,203,720.98
(2)Reconciliation of account profit and income tax expenses
In RMB
Items Amount of current period
Total profits 86,233,463.16
Current income tax expense accounted by tax and relevant
21,558,365.79
regulations
Influence of different tax rates applied by some subsidiaries -7,491,633.67
Non-deductible costs, expenses and losses 4,571,839.81
Tax impact by the unrecognized deductible losses and
8,059,643.49
deductible temporary differences in previous years
Profit and loss of joint venture and associated enterprises
-53,103.78
accounted for by equity method
Tax impact of research and development fee plus deduction -15,526,314.68
Income tax fee 11,118,796.96
Other note
77. Other comprehensive income
Refer to the notes 57
78. Supplementary information to cash flow statement
(1) Other cash received relevant to operating activities
In RMB
Items Amount of current period Amount of previous period
Letter of Credit Deposit 35,875,977.74 95,971,397.61
Interest income 1,655,853.59 3,702,735.59
Government Subsidy 19,363,739.42 12,029,059.97
Current account 31,729,758.78 11,704,807.26
Total 88,625,329.53 123,408,000.43
226
2021 Annual Report
Note to other cash received in connection with operating activities: None
(2)Other cash paid related to operating activities
In RMB
Items Amount of current period Amount of previous period
Payment of credit deposit 164,509,022.41 50,257,183.69
Cash 48,012,370.68 37,855,834.17
Current account and other 12,867,319.88 9,104,639.66
Total 225,388,712.97 97,217,657.52
Note to other cash paid in connection with operating activities: None
(3)Cash received related to other investment activities
In RMB
Items Amount of current period Amount of previous period
Structured deposits, financial products,
1,128,309,484.61 3,112,161,370.37
principal and income
L/C margin for purchase of line 7
126,799,633.00
equipment
Credit deposit for non-Line 7 equipment 1,900,000.00
Total 1,128,309,484.61 3,240,861,003.37
Note to other cash received related to other investment activities：None
(4).Cash paid related to other investment activities
In RMB
Items Amount of current period Amount of previous period
Structured deposits, financial products,
965,000,000.00 3,004,000,000.00
principal and income
L/C margin for purchase of line 7
2,150,000.00
equipment
Credit deposit for non-Line 7 equipment 1,900,000.00
Equity transaction expenses 15,275.20
Total 965,000,000.00 3,008,065,275.20
227
2021 Annual Report
Note to other Cash paid related to other investment activities
（5）Other cash received in relation to financing activities
In RMB
Items Amount of current period Amount of previous period
（6）Cash paid related with financing activities
In RMB
Items Amount of current period Amount of previous period
Restricted stock of stock repurchase
7,820,298.30 9,344,136.30
incentive object
Lease payment 4,817,974.70
Total 12,638,273.00 9,344,136.30
Note to other Cash paid related with financing activities：
79. Supplement Information for cash flow statement
（1）Supplement Information for cash flow statement
In RMB
Items Amount of current period Amount of previous period
I. Adjusting net profit to cash flow from
-- --
operating activities
Net profit 75,114,666.20 43,497,645.15
Add: Impairment loss provision of assets 83,508,720.33 82,807,011.28
Depreciation of fixed assets, oil and gas
182,116,694.00 117,440,111.32
assets and consumable biological assets
Depreciation of Use right assets 4,540,987.37
Amortization of intangible assets 5,030,106.23 1,612,363.59
Amortization of Long-term deferred
1,171,163.32 582,518.72
expenses
Loss on disposal of fixed assets, intangible
-597,458.77 -276,544.73
assets and other long-term deferred assets
Fixed assets scrap loss 369,187.12 3,315.15
Loss on fair value changes -2,150,943.40 -2,687,518.74
Financial cost 14,306,275.13 455,850.38
228
2021 Annual Report
Loss on investment -22,663,013.06 -22,599,670.74
Decrease of deferred income tax assets 1,534,828.48 374,601.17
Increased of deferred income tax liabilities 2,500,994.33 -10,802,679.08
Decrease of inventories -270,089,816.70 -39,880,044.30
Decease of operating receivables -58,547,894.61 -184,426,504.09
Increased of operating Payable -25,563,036.85 15,830,477.68
Other 4,981,560.53
Net cash flows arising from operating
-4,436,980.35 1,930,932.76
activities
II. Significant investment and financing
--
activities that without cash flows:
Conversion of debt into capital
Convertible loan due within 1 year
Financing of fixed assets leased
3.Movement of cash and cash equivalents： -- --
Ending balance of cash 302,408,433.72 278,337,236.95
Less: Beginning balance of cash
278,337,236.95 268,646,588.18
equivalents
Add：End balance of cash equivalents
Less: Beginning balance of cash
equivalents
Net increase of cash and cash equivalent 24,071,196.77 9,690,648.77
(2) Net Cash paid of obtaining the subsidiary
In RMB
Amount
Of which： --
Of which： --
Of which： --
Other note：
(3) Net Cash receive of disposal of the subsidiary
In RMB
Amount
229
2021 Annual Report
Of which： --
Of which： --
Of which： --
Other note：
(4) Component of cash and cash equivalents
In RMB
Items Year-end balance Year-beginning balance
I. Cash 302,438,856.00 278,337,236.95
Including：Cash at hand 792.64 4,127.10
Demand bank deposit 302,407,641.08 271,085,025.10
Demand other monetary funds 7,248,084.75
III. Balance of cash and cash equivalents
302,408,433.72 278,337,236.95
at the period end
Other note：
80. Note of statement of changes in the owner's equity
Specify the description of the item "others" and the adjusted amount of the balance at the end of last year:
81. The assets with the ownership or use right restricted
In RMB
Book value at the end of the reporting
Items Cause of restriction
period
Fixed assets 243,106,926.00 Mortgage
Intangible assets 33,875,655.97 Mortgage
Total 276,982,581.97 --
Other note：
82. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Closing foreign currency Closing convert to RMB
Items Exchange rate
balance balance
Monetary funds -- --
Including：USD 3,396,814.97 6.3757 21,657,073.20
Euro
HKD 806,319.92 0.8176 659,247.17
230
2021 Annual Report
Yen 15,363,481.00 0.0554 851,136.85
Account payable -- --
Including：USD 9,987,772.57 6.3757 63,679,041.57
Euro
HKD
Prepayments
Including：USD 588,809.23 6.3757 3,754,071.01
Yen 30,197,869.00 0.0554 1,673,414.91
Other receivables
Including：USD 37,399.02 6.3757 238,444.93
accounts payable
Including：USD 4,122,038.21 6.3757 26,280,879.02
Yen 3,043,388,138.00 0.0554 168,649,353.67
Other payables
Including：USD 676,686.00 6.3757 4,314,346.93
Yen 3,381,984.00 0.0554 187,361.91
Euro 22,500.00 7.2197 162,443.25
Other note：
(2) Note to overseas operating entities, including important overseas operating entities, witch should be disclosed
about its principal business place, function currency for bookkeeping and basis for the choice. In case of any
change in function currency, the cause should be disclosed.
□ Applicable √ Not applicable
83. Hedging
Arbitrage According to arbitrage category to disclose arbitrage item, relevant arbitrage tools and the arbitraged
risk qualitative and quantitative information:
84. Government subsidies
（1）Government subsidies confirmed in current period
In RMB
Amount included in current
Items Amount Project
profit and loss
Funding subsidy for change
and renovation of old 720,241.51 Other income 142,255.72
elevators
231
2021 Annual Report
Textile special funds 142,857.09 Other income 142,857.16
Shenzhen Special Fund
Subsidy for Atmospheric
Environment Quality 442,000.00 Other income 52,000.00
Improvement- Shenzhen
Beauty Century
Subsidy for the technical
transformation project of
dyeing equipment by the 91,000.00 Other income 39,000.00
Bureau of Industry and
Information Technology
Subsidy funds for
industrialization project of 433,333.39 Other income 1,299,999.96
polarizers for TFT-LCD
Subsidy funds for the narrow
line (Line 5) of the first-phase
499,999.96 Other income 500,000.04
project of polarizer for
TFT-LCD
Amortization of subsidies for
purchase of imported 151,746.19 Other income 175,090.20
equipment and technology
Innovative and
entrepreneurial funds for the
49,999.94 Other income 50,000.04
first phase of the TFT-LCD
polarizer project
Introducing advanced
14,388.09 Other income 14,388.12
technology funding
Innovation and
entrepreneurship funds of
Shenzhen Polarizing 162,499.96 Other income 50,000.04
Materials and Technology
Engineering Laboratory
Funding for technology
975,000.00 Other income 300,000.00
center construction
Shenzhen Polarizing
Materials and Technology 1,625,000.00 Other income 500,000.00
Engineering Laboratory
Subsidy fund for R&D
equipment of key technology
2,624,999.96 Other income 500,000.04
of optical compensation film
for polarizer
232
2021 Annual Report
Local matching funds for the
second phase of TFT-LCD 9,750,000.00 Other income 1,500,000.00
polarizer project (Line 6)
Funds for the pilot project of
regional agglomeration
development of strategic 16,249,999.92 Other income 2,500,000.08
emerging industries in
Guangdong Province
Local matching funds for the
second phase of TFT-LCD 6,500,000.00 Other income 1,000,000.00
polarizer project (Line 6)
Subsidies for new production
lines and purchase of
equipment for the Phase II 19,500,000.00 Other income 3,000,000.00
project of polarizers for
TFT-LCD
Innovative and
entrepreneurial funds for the
second phase of the 324,999.96 Other income 50,000.04
TFT-LCD polarizer project
(Line 6)
Investment funds within the
central budget of the polarizer
28,750,000.00 Other income 1,250,000.00
industrialization project for
super-large TVs (Line 7)
Funding for key technology
research and development of
1,983,333.33 Other income 16,666.67
polarizers for ultra-thin IPS
smartphone terminals
Shenzhen Municipal Finance
Committee (2018N007 Major
Research and development of
6,000,000.00 Other income
key technologies for
high-performance polarizers
for large-size display panels)
Shenzhen Special Fund
Subsidy for Atmospheric
Environment Quality 147,643.86 Other income 442,931.57
Improvement- SAPO
Photoelectric
Subsidies for investment 159,916.67 Other income 19,000.00
233
2021 Annual Report
projects in special
technological transformation
for technological
transformation and doubling
in 2020
Funding by Shenzhen
Municipal Bureau of Finance
2020N028 Key technology
research and development 2,500,000.00 Other income
project of low-color polarized
circular polarizer for
fixed-curvature AMOLED
Awards support by 2021
special major projects of
10,662,333.32 Other income 367,666.68
technological transformation
and doubling
Subsidy funds for
Other income 27,172.70
energy-saving renovation
（2）Government subsidy return
□ Applicable √ Not applicable
Other note：
85.Other
(1) Arbitration matters between the Company and Jinjiang Group
At the end of 2016, the Company introduced Jinjiang Group as a strategic investor for the capital increase and
share expansion of SAPO Photoelectric. The Company, SAPO Photoelectric, Jinjiang Group and Hangzhou
Jinhang Equity Investment Fund Partnership (Limited Partnership), a limited partnership established by the former
Jinjiang Group as the actual controller, jointly signed the Cooperation Agreement. Jinjiang Group made a
commitment to the performance of SAPO Photoelectric from 2017 to 2019, and Jinjiang Group promised that if
the promised income and net profit were not fulfilled, it would make a difference between the promised net profit
and the actual profit. In 2018 and 2019, Jinjiang Group failed to fulfill its performance commitments as agreed,
and the performance compensation in 2018 was received by the Company in 2019 as agreed, totaling RMB
197,268,700; For the performance compensation in 2019, Jinjiang Group believes that it can't lead the operation
and management of SAPO Photoelectric, which leads to the failure to realize the contractual purpose of the
Cooperation Agreement, and applies to Shenzhen Court of International Arbitration for arbitration.
On March 25, 2021, the arbitration tribunal made the following ruling on this case: (I) The applicant is exempted
from the performance compensation obligation in 2019 agreed in Article 3.1 of the Cooperation Agreement, and
does not need to pay SAPO Photoelectric the compensation for the performance difference in 2019 of RMB
244,783,800; (II) The arbitration fee of RMB 2,682,011 and the actual expenses of the arbitrator of RMB 8,000 in
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2021 Annual Report
this case shall be borne by the applicant; (III) Other arbitration claims of the applicant are not supported. This
award shall be final and take legal effect from the date it is made.
(2) Shenzhen Xieli Automobile Enterprise Co., Ltd. (property not yet disposed of)
Shenzhen Xieli AutomobilCo., Ltd. is a Sino-foreign joint venture invested by the Company and Hong Kong Xieli
Maintenance Co. Ltd. in 1981, with a registered capital of RMB 3.12 million, 50% of whose equity is held the
Company. The operating period of the Company ended in 2008, and its business license was revoked in 2014. The
main assets of the Company are real estate. The industrial and commercial license of Shenzhen Xieli was
cancelled in March 2020, but there are still three properties under its name, the disposal of which is required to be
resolved after further consultation between the shareholders of both parties.
On July 26, 2021, the Company filed a lawsuit with Yantian District People's Court in Shenzhen City, Guangdong
Province to revoke the cancellation of Shenzhen Xieli Automobile Enterprise Co., Ltd. approved by Shenzhen
Administration for Market Regulation on March 9, 2020, on which the court gave a judgment on November 21,
2021 to revoke the cancellation of Shenzhen Xieli Automobile Enterprise Co., Ltd. approved by Shenzhen
Administration for Market Regulation.
VIII. Changes of merge scope
1. Business merger not under same control
(1) Business merger not under same control in reporting period
In RMB
Income of Net profits
Time and Recognitio acquiree of acquiree
Cost Proportion Way to
place of Purchase n basis of during the during the
Name gaining the of stock gain the
gaining the date purchase purchase purchase
stock rights rights stock rights
stock right date date to date to
period-end period-end
Other note：
（2）Combined cost and Goodwill
In RMB
Combined cost
Other note
(3) The identifiable assets and liabilities of acquiree at purchase date In RMB
In RMB
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2021 Annual Report
Fair value of the purchase date Book value of the purchase date
Other note
(4) The profit or loss from equity held by the date before acquisition in accordance with the fair value measured
again、
Whether there is a transaction that through multiple transaction step by step to realize enterprises merger and
gaining the control during the reporting period
□ Yes √ No
(5) Note to merger could not be determined reasonable consideration or Identifiable assets, Fair value of liabilities
of the acquiree at acquisition date or closing period of the merge
（6）Other note
2. Business combination under the same control
(1) Business combination under the same control during the reporting period
Not applicable
Other note：
(2) Combination cost
Not applicable
Other note：
(3) The book value of the assets and liabilities of the merged party on the date of consolidation
Not applicable
Other note：
3. Counter purchase
Basic information of trading, the basis of transactions constitute counter purchase, the retain assets , liabilities of
the listed companies whether constituted a business and its basis, the determination of the combination costs, the
amount and calculation of adjusted rights and interests in accordance with the equity transaction process.Not
applicable
4. The disposal of subsidiary
Whether there is a single disposal of the investment to subsidiary and lost control
□ Yes √No
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2021 Annual Report
Whether there are multiple transactions step by step dispose the investment to subsidiary and lost control in
reporting period
□ Yes √ No
5. Other reasons for the changes in combination scope
Note to the change in the consolidation scope (e.g. new subsidiaries, liquidation subsidiaries, etc.) caused by other
reasons and relevant information:
6.Other
IX. Equity in other entities
1. Equity in subsidiary
(1) The structure of the enterprise group
Registered Share-holding ratio
Subsidiary Main operation Business nature Acquired way
place Directly Indirectly
Shenzhen Lishi
Domestic trade,
Industry 100.00% Establish
Shenzhen Shenzhen Property
Development
Management
Co., Ltd
Accommodatio Establish
Shenzhen 100.00%
Shenzhen Shenzhen n, restaurants,
Huaqiang Hotel
business center;
Shenzhen
Shenfang Real
Property 100.00% Establish
Estate Shenzhen Shenzhen
Management
Management
Co., Ltd.
Production of Establish
Shenzhen
fully electronic
Beauty Century 100.00%
Shenzhen Shenzhen jacquard
Garment Co.,
knitting whole
Ltd.
shape
Shenzhen
Shenfang
Sungang Real Property
Shenzhen Shenzhen 100.00% Establish
Estate Management
Management
Co., Ltd.
SAPO Polarizer
Shenzhen Shenzhen 60.00%
Photoelectric production and
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2021 Annual Report
sales
Shenzhen Establish
Polarizer
Shengjinlian
Shenzhen Shenzhen production and 100.00%
Technology
sales
Co., Ltd.
Shengtou
(Hongkong) Sales of 100.00% Establish
Hongkong Hongkong
polarizer
Co.,Ltd.
Explanation that the shareholding ratio in subsidiaries is different from the voting right ratio: None
Basis for holding half or less voting rights but still controlling the investee, and holding more than half voting
rights but not controlling the investee: None
For the important structured subjects included in the scope of consolidation, the control basis is: None
Basis for determining whether the company is an agent or a principal: None
Other note：Note
（2）Significant not wholly-owned subsidiaries
In RMB
Profit or loss
Holding proportion of Dividend declared to Closing balance of
Name attributable to
non-controlling interest non-controlling interest non-controlling interest
non-controlling interest
SAPO Photoelectric 40.00% 15,173,715.28 1,142,495,431.83
Other note：
None
（3）Main financial information of significant not wholly-owned subsidiaries
In RMB
Closing balance Beginning balance
Curren Non-c Curren Non-c
Subsid Non-c Total Non-c Total
Curren Total t urrent Curren Total t urrent
iaries urrent liabilit urrent liabiliti
t assets assets liabiliti Liabili t assets assets liabiliti Liabili
assets ies assets es
es ties es ties
SAPO 1,622, 2,581, 4,204, 521,12 827,06 1,348, 1,493, 2,177, 3,670, 399,97 452,17 852,14
Photoe 715,94 716,14 432,09 7,167. 6,348. 193,51 320,59 130,75 451,34 5,943. 1,112. 7,055.
lectric 7.38 8.26 5.64 55 51 6.06 0.48 6.68 7.16 39 38 77
In RMB
Subsidiarie Amount of current period Amount of previous period
s Operating Net profit Total Cash flow Operating Net profit Total Cash flow
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2021 Annual Report
revenue comprehen from revenue comprehen from
sive operating sive operating
income activities income activities
SAPO
2,126,851, 37,934,288 37,934,288 -11,450,77 1,961,577, 16,768,253 16,768,253 -1,921,942.
Photoelectr
011.63 .19 .19 1.90 740.37 .29 .29 93
ic
Other note：
None
(4) Significant restrictions of using enterprise group assets and pay off enterprise group debt
None
(5) Provide financial support or other support for structure entities incorporate into the scope of consolidated
financial statements
None
Other note：
None
2. The transaction of the Company with its owner’s equity share changed but still controlling the subsidiary
(1) Note to owner’s equity share changed in subsidiary
None
(2) The transaction’s influence to equity of minority shareholders and attributable to the owner's equity of the
parent company
Other note
None
3. Equity in joint venture arrangement or associated enterprise
(1) Significant joint venture arrangement or associated enterprise
Shareholding Ratio (%) The accounting
Name of Main Places of Registration Nature of treatment of
Subsidiary Operation Place Business direct indirect investment in
associates
Joint venture：
Shenzhen
Property
Guanhua Shenzhen Shenzhen 50.16% Equity method
leasing
Printing &
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2021 Annual Report
Dyeing
Co.,Ltd.
Anhui Huapeng
Textile Co., Anhui Anhui Manufacturing 50.00% Equity method
Ltd.
Associated
enterprise
Shenzhen
Changlianfa
Property
Printing and Shenzhen Shenzhen 40.25% Equity method
leasing
dyeing
Company
Jordan Garment
Jordan Jordan Manufacturing 35.00% Equity method
Factory
Yehui
International Hongkong Hongkong Manufacturing 22.75% Equity method
Co., Ltd.
Explanation that the shareholding ratio in the joint venture or associated enterprise is different from the voting
right ratio:
Basis for holding less than 20% of voting rights but with significant influence, or holding 20% or more of voting
rights but without significant influence:
（2）The Summarized Financial Information of Joint Ventures
In RMB
Year-end balance/ Amount of current Year-beginning balance/ Amount of
period previous period
Shenzhen Guanhua Printing & Dyeing
Co.,Ltd.
Current assets 37,787,147.72 19,854,144.21
Non-current assets 228,639,403.03 241,137,964.49
Total assets 266,426,550.75 260,992,108.70
Current liabilities 18,194,214.40 12,261,343.60
Non-current liabilities 35,190,853.69 37,356,444.69
Total liabilities 53,385,068.09 49,617,788.29
Attributable to shareholders of the parent
213,041,482.67 211,374,320.41
company
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2021 Annual Report
Share of net assets calculated by stake 106,861,607.70 106,025,359.12
--Goodwill 21,595,462.44 21,595,462.44
--Other 285,343.61 285,343.61
Operating income 21,404,639.29 14,623,800.97
Financial expenses -174,304.72 -39,339.28
Income tax expenses 499,490.10 -2,118,023.83
Net profit 614,155.44 -3,422,861.88
Total comprehensive income 614,155.44 -3,422,861.88
Other note
(3) Main financial information of significant associated enterprise
In RMB
Year-end balance/ Amount of current Year-beginning balance/ Amount of
period previous period
Other note
(4) Summary financial information of insignificant joint venture or associated enterprise
In RMB
Year-end balance/ Amount of current Year-beginning balance/ Amount of
period previous period
Joint venture： -- --
Total amount of the pro rata calculation of
-- --
the following items
Associated enterprise： -- --
Total amount of the pro rata calculation of
-- --
the following items
Other note
(5) Note to the significant restrictions of the ability of joint venture or associated enterprise transfer funds to the
Company
(6) The excess loss of joint venture or associated enterprise
Other note
(7) The unrecognized commitment related to joint venture investment
(8) Contingent liabilities related to joint venture or associated enterprise investment
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2021 Annual Report
4. Significant common operation
5. Equity of structure entity not including in the scope of consolidated financial statements
Related notes to structure entity not including in the scope of consolidated financial statements
6.Other
X. Risks Related to Financial Instruments
XI. The disclosure of the fair value
1. Closing fair value of assets and liabilities calculated by fair value
In RMB
Closing fair value
Fir value
Items Fir value measurement Fir value measurement
measurement items at Total
items at level 2 items at level 3
level 1
I. Consistent fair value
-- -- -- --
measurement
II Inconsistent fair value
-- -- -- --
measurement
XII. Related parties and related-party transactions
1.Parent company information of the enterprise
The parent The parent
Name Registered address Nature Registered capital company of the company of the
Company's Company’s vote
shareholding ratio ratio
Equity
18/F, Investment
Shenzhen investment ,
Building, Shennan
Investment Real-estate 2,800,900.00 46.21% 46.21%
Holdings Co.,Ltd. Road, Futian
Development and
District, Shenzhen Guarantee
Note to the parent company:
The company is authorized and approved to be state-owned independent company by Shenzhen Government, and
it Executes financial contributor function on state-owned enterprise within authorization scope.
Therefore, the Company’s ultimate controller is Shenzhen Investment Holdings Co., Ltd.
Other note：None
242
2021 Annual Report
2.Subsidiaries of the Company
For details of the subsidiary of the Company, see "Section X Financial Report IX. Interests in other subjects
3. Information on the joint ventures and associated enterprises of the Company
For important joint ventures or joint ventures of the Company, see the notes to the joint venture and joint
ventures of the Company. See " Section X Financial Report IX. Interests in other entities.
Other note
4.Other Related parties information
Other related party Relationship to the Company
Shenzhen Tianma Microelectronics Co., Ltd. Chairman of the Board Is the Vice Chairman of the Company
Suzhou Advantage Ford Investment Center (Limited
The controlling party of SAPO Shareholder
partnership)
Shengto (HK) Co., Ltd. The Company Executives are Director of the company
Sharing Company of Suzhou Advantage Ford Investment
Hengmei Photoelectric Co., Ltd.
Center (Limited partnership)
Shenzhen Xinfang Knitting Co., Ltd. Sharing Company
Shenzhen Dailishi Underwear Co., Ltd. Sharing Company
Other note
None
5. Related transactions.
（1）Related transactions on purchasing goods and receiving services
Acquisition of goods and reception of labor service
In RMB
Content of
Amount of Amount of previous Over the trading Amount of last
Related parties related
limit or not? period
transaction
current period period
Hengmei
Technical
Photoelectric Co., 0.00 0.00 No 1,415,263.58
service
Ltd.
Hengmei
Polarized 0.00 0.00 No 204,282,036.36
Photoelectric Co.,
243
2021 Annual Report
Ltd.
Related transactions on sale goods and receiving services
In RMB
Related party Content
Amount of current period Amount of previous period
Shenzhen Tianma
Polarized 1,441,975.42 1,485,995.60
Microelectronics Co., Ltd.
Hengmei Photoelectric Co.,
Polarized 0.00 110,545,214.28
Ltd.
Note
None
(2) Related trusteeship/contract
Not applicable
(3) Information of related lease
Not applicable
(4) Related-party guarantee
Related guarantee
In RMB
Whether the guarantee
Guaranteed party Amount Guarantee start date Guarantee end date
has been fulfilled
SAPO photoelectric 409,127,400.00 September 8,2020 No
The Company is the secured party
Not applicable
(5) Inter-bank lending of capital of related parties：
In RMB
Related party Amount Start date Expiring date Note
Borrowing fund：
Shenzhen Guanhua
The annual lending
Printing & Dyeing Co., 3,806,454.17 July 30,2019
interest rate is 0.30%
Ltd.
Loaned
244
2021 Annual Report
(6) Related party asset transfer and debt restructuring
(7) Rewards for the key management personnel
In RMB
Items Amount of current period Amount of previous period
Rewards for the key management
11,152,800.00 9,175,000.00
personnel
(8) Other related transactions
6. Receivables and payables of related parties
（1）Receivables
In RMB
Amount at year end Amount at year beginning
Name Related party Bad debt
Balance of Book Balance of Book Balance of Book
Provision
Shenzhen Tianma
Account
Microelectronics 412,495.18 18,686.03 581,696.96 25,652.84
receivable
Co., Ltd.
Hengmei
Account
Photoelectric Co., 0.00 0.00 20,879,229.37 920,774.02
receivable
Ltd.
Other Account Anhui Huapeng
0.00 0.00 1,800,000.00 1,800,000.00
receivable Textile Company
Shenzhen Dailishi
Other Account
Underwear Co., 1,100,000.00 55,000.00 0.00 0.00
receivable
Ltd.
（2）Payables
In RMB
Name Related party Amount at year end Amount at year beginning
Hengmei Photoelectric Co.,
Account payable 170,977.53 35,787,643.44
Ltd.
Shenzhen Xinfang Knitting
Other payable 244,789.85 244,789.85
Co., Ltd.
Other payable Shenzhen Changlianfa 2,023,699.95 1,580,949.95
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2021 Annual Report
Printing & dyeing Co., Ltd.
Other payable Yehui International Co.,Ltd. 1,124,656.60 1,143,127.81
Shengtou （Hongkong）Co.,
Other payable 315,000.00 315,000.00
Ltd.
Shenzhen Guanhua Printing
Other payable 3,806,454.17 3,811,240.92
& dyeing Co., Ltd.
7. Related party commitment
None
8.Other
None
XIII. Share payment
1. Overall situation of share payment
√ Applicable □Not applicable
In RMB
Total amount of various equity instruments granted by the company
0.00
during the current period
Total amount of various equity instruments that the company exercises
0.00
during the period
Total amount of various equity instruments that have expired in the
1,250,430.00
current period
The scope of executive price of the company’s outstanding share
0 yuan，0 year
options at the end of the period and the remaining term of the contract
The scope of executive price of the company’s other equity instruments
5.73 /yuan/share，1 year
at the end of the period and the remaining term of the contract
Other note
Note :On December 14, 2017, the company's 3rd Extraordinary General Meeting of Shareholders in 2017 passed
the Proposal on ‘Shenzhen Textile (Group) Co., Ltd. 2017 Restricted Stock Incentive Plan (Draft) and Abstract’;
on December 14, 2017, the board of directors of the company reviewed and passed the Proposal on Adjusting the
List of Incentive Objects of Restricted Stock Incentive Plans and the Number of Equity Granted of 2017, and the
Proposal on Granting Restrictive Shares to Incentive Objects. On December 14, 2017, the company granted
4,752,300 restricted shares to the incentive object, the grant price was 5.73 yuan/share. Restrictions shall be lifted
at the rate of 40%, 30%, and 30% respectively after 12 months, 24 months, and 36 months after the first
transaction date of 24 months after the completion of the registration. The company's performance assessment for
the restricted shares granted each period is as follows:
Restriction lifting period Performance assessment goals
246
2021 Annual Report
In 2018, the earnings per share shall be no less than 0.07 yuan, and shall not be lower than the
75 fractiles level of the comparable listed companies in the same industry; the growth rate of
The first restriction lifting
operating revenue in 2018 compared with 2016 is not less than 70%, and is not lower than the
period
75 fractiles level of comparable listed companies in the same industry; in 2018, the proportion
of optical film business such as polarizers to operating revenue is no less than 70%.
In 2019, earnings per share shall be no less than 0.08 yuan, and shall not be lower than the 75
fractiles level of the comparable listed companies in the same industry; the growth rate of
The second restriction lifting
operating revenue in 2019 compared with 2016 is not less than 130%, and is not lower than the
period
75 fractiles level of comparable listed companies in the same industry; in 2019, the proportion
of optical film business such as polarizers to operating revenue is not less than 75%.
In 2020, the earnings per share shall be no less than 0.20 yuan, and shall not be lower than the
75 fractiles level of comparable listed companies in the same industry; the growth rate of
The third restriction lifting
operating revenue in 2020 is not less than 200% compared to 2016, and is not lower than the 75
period
fractiles level of comparable listed companies in the same industry. In 2020, the proportion of
optical film business such as polarizers to operating revenue will be no less than 80%.
Note: Earnings per share=net profit/total capital stock attributable to common shareholders of the Company
upon deduction of non-recurring profit and loss.
On February 2, 2021, the company held the first extraordinary general meeting of shareholders in 2021 to
consider and pass the "Proposal on Repurchase and Cancellation of Certain Restricted Stocks", agreeing to the
company's total holdings of 1 original incentive object who resigned due to personal reasons 7,950 restricted
stocks were repurchased and cancelled at a repurchase price of 5.73 yuan/share; It was agreed that the Company
repurchase and cancel 6,000 restricted shares held by one original incentive object who had failed to meet the
incentive conditions due to retirement at 6.23 yuan/share.
On April 7, 2021, the company held the 2020 Annual General Meeting of Shareholders to review and approve
the Proposal on Repurchase and Cancellation of Some Restricted Stocks, and agreed that the company would
repurchase and cancel 1,236,480 restricted stocks held by 102 incentive objects in the third issue that did not meet
the conditions for lifting the restrictions on sales, and the repurchase price was RMB 6.26 per share.
2. Equity-settled share-based payment
√ Applicable □Not applicable
In RMB
Determination method of the fair value of equity instruments on The closing price of the company's stock on grant date -
the grant date grant price
On each balance sheet date of the waiting period, it is
determined based on the latest information such as the
Determination basis of the number of vesting equity instruments
change in the number of people that can be released from
restrictions and the completion of performance indicators
Reasons for the significant difference between the current period
None
estimate and the previous period estimate
Equity-settled share-based payment is included in the 0.00
247
2021 Annual Report
accumulated amount of capital reserve
Total amount of fees confirmed by equity-settled share-based
0.00
payments in the current period
Other note
None
3. The Stock payment settled by cash
□ Applicable √ Not applicable
4. Modification and termination of the stock payment
None
5.Other
None
XIV. Commitments
1. Significant commitments
Significant commitments at balance sheet date
As of December 31,2021,The company does not disclose the pension plan undisclosed matter should exist.
2. Contingency
(1) Significant contingency at balance sheet date
As of December 31,2021,The company does not disclose the pension plan undisclosed matter should exist.
(2) The Company have no significant contingency to disclose, also should be stated
None
3.Other
None
XV. Events after balance sheet date
1. Significant events had not adjusted
Not applicable
248
2021 Annual Report
2. Profit distribution
Not applicable
3. Sales return
None
4. Notes of other significant events
As of December 31,2021,The company does not disclose the pension plan undisclosed matter should exist.
XVI. Other significant events
1. Correction of the accounting errors in the previous period
(1) Retroactive restatement
(2) Prospective application
2. Liabilities restructuring
None
3. Replacement of assets
(1) Non-monetary assets exchange
None
(2) Other assets exchange
None
4. Pension plan
None
5. Discontinuing operation
None
249
2021 Annual Report
6. Segment information
(1) Basis for determining the reporting segments and accounting policy
The Company determines its operating divisions based on its internal organizational structure, management
requirements and internal reporting system. Based on the operating divisions, the Company confirms four
reporting divisions, namely textiles, polarizer, trade and property leasing.
Divisional reporting information is disclosed in accordance with the accounting policies and measurement
standards adopted by each division when reporting to the management. These measurement basis are consistent
with the accounting and measurement basis for financial statement preparation.
（2）Financial information of the report division
In RMB
Property lease Offset between
Items Polarizer Textile Trade Total
and other divisions
Operating income 2,117,717,019.48 129,445,842.10 55,169,650.79 -8,584,620.31 2,293,747,892.06
Including: revenue
from foreign 2,117,717,019.48 121,098,294.00 54,932,578.58 0.00 2,293,747,892.06
transaction
Revenue from
inter-segment 0.00 8,347,548.10 237,072.21 -8,584,620.31 -8,584,620.31
transactions
Including:
revenue from main 2,099,489,550.77 114,363,911.23 55,169,650.79 -3,032,482.89 2,265,990,629.90
business
Operating cost 1,828,378,235.90 38,998,238.06 48,686,874.43 -7,543,935.11 1,908,519,413.28
Including: main
1,828,378,235.90 26,709,964.52 48,686,874.43 -3,527,746.06 1,900,247,328.79
business cost
Operating profit 28,041,538.58 53,280,168.22 815,378.80 -15,576,656.93 73,511.20 66,633,939.87
Total assets 4,204,357,864.87 3,296,896,012.57 46,233,785.98 -2,050,840,555.59 5,496,647,107.83
Total
1,380,985,834.98 211,828,635.06 27,995,367.47 -87,991,976.75 1,532,817,860.76
indebtedness
(3) In case there is no reporting segment or the total assets and liabilities of the reporting segments cannot be
disclosed, explain the reason
None
250
2021 Annual Report
（4）Other note
None
7. Other significant transactions and matters that may affect investors' decision making
None
8.Other
None
XVII. Notes of main items in the financial statements of the Parent Company
1. Accounts receivable
(1) Accounts receivable classified by category
In RMB
Amount in year-end Amount in year-beginning
Bad debt
Book balance Book balance Bad debt provision
Category provision Book Book
Amoun Proport Amoun Proport value Amoun Proport Amoun Proport value
t ion(%) t ion(%) t ion(%) t ion(%)
Including：
Accrual of bad
8,353,5 100.00 417,67 7,935,9 1,538,3 100.00 76,915. 1,461,40
debt provision by 5.00% 5.00%
90.78 % 9.54 11.24 16.00 % 80 0.20
portfolio
Including：
8,353,5 100.00 417,67 7,935,9 1,538,3 100.00 76,915. 1,461,40
Total 5.00% 5.00%
90.78 % 9.54 11.24 16.00 % 80 0.20
Accrual of bad debt provision by single item
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion
Accrual of bad debt provision by portfolio: 417,679.54 yuan
In RMB
Closing balance
Name
Book balance Bad debt provision Proportion
Within 1 year 6,815,274.78 340,763.74 5.00%
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2021 Annual Report
1-2 years 1,538,316.00 76,915.80 5.00%
Total 8,353,590.78 417,679.54 --
Accrual of bad debt provision by portfolio
In RMB
RMB
Closing balance
Name
Book balance Bad debt provision Proportion
Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of
other receivables if the provision for bad debts of bills receivable is accrued according to the general model of
expected credit loss:
□ Applicable √ Not applicable
Disclosure by aging
In RMB
Aging Closing balance
Within 1 year（Including 1 year） 6,815,274.78
1-2 years 1,538,316.00
2-3 years 0.00
Over 3 years 0.00
3-4 years 0.00
Total 8,353,590.78
(2) Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision：
In RMB
Amount of change in the current period
Opening Reversed or Closing
Category
balance Accrual collected Write-off Other balance
amount
76,915.80 340,763.74 417,679.54
Total 76,915.80 340,763.74 417,679.54
Total 76,915.80 66,116.12 143,031.92
Where the significant amount of the reserve for bad debt recovered or reversed:
In RMB
Name Amount Mode
None
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2021 Annual Report
(3) The actual write-off accounts receivable
In RMB
Items Amount
（4）The ending balance of other receivables owed by the imputation of the top five parties
In RMB
Name Closing balance Proportion % Balance of Bad debt
provision
Shenzhen Guangsheng
Development Industry Co., 5,610,352.81 67.16% 280,517.64
Ltd.
Shenzhen Beauty Century
Garment Co., Ltd. 2,485,076.00 29.75% 124,253.80
Shenzhen Yuehao Hotel
245,621.97 2.94% 12,281.10
Management Co., Ltd.
Cao Cheng 9,300.00 0.11% 465.00
Ma Yue 3,240.00 0.04% 162.00
Total 8,353,590.78 100.00% --
(5) Account receivable which terminate the recognition owning to the transfer of the financial assets
None
(6) The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts
receivable
None
2. Other accounts receivable
In RMB
Items Closing balance Opening balance
Other accounts receivable 14,383,631.68 7,450,934.40
Total 14,383,631.68 7,450,934.40
（1）Interest receivable
1）Category of interest receivable
In RMB
253
2021 Annual Report
Items Closing balance Opening balance
2) Significant overdue interest
I n RMB
Whether or not the
Balance in Reasons for impairment and the
Items) Aging
year-end non-recovery basis for its
determination
Other note：
3）Bad-debt provision
√Applicable □ Not applicable
In RMB
Stage 1 Stage 2 Stage 3
Expected credit losses
Expected credit Expected credit loss
Bad debt provision for the entire duration Total
losses over the over life (no credit
(credit impairment
next 12 months impairment)
occurred)
Balance as at January
—— —— —— ——
1,2021 In current
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
(2)Dividend receivable
1) Category of Dividend receivable
(2)Dividend receivable
1) Category of Dividend receivable
In RMB
Items Closing balance Opening balance
2) Significant dividends receivable with age exceeding 1 year
I n RMB
Whether or not the
Balance in Reasons for
Items) Aging impairment and the
year-end non-recovery
basis for its
254
2021 Annual Report
determination
3）Bad-debt provision
√Applicable □ Not applicable
In RMB
Stage 1 Stage 2 Stage 3
Expected credit Expected credit loss over Expected credit losses for
Bad debt provision Total
losses over the next life (no credit the entire duration (credit
12 months impairment) impairment occurred)
Balance as at January
1,018,014.39 15,111,246.32 16,129,260.71
1,2021
Balance as at January
—— —— —— ——
1,2021 In current
Provision in the current
369,750.00 369,750.00
period
Balance as at
1,387,764.39 15,111,246.32 16,499,010.71
December 31,2021
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
Other note：
（3） Other accounts receivable
1) Other accounts receivable classified by the nature of accounts
In RMB
Nature Closing book balance Opening book balance
Other receivable 14,383,631.68 7,450,934.40
Total 14,383,631.68 7,450,934.40
2）Bad-debt provision
In RMB
Stage 1 Stage 2 Stage 3
Expected credit Expected credit loss over Expected credit losses for
Bad Debt Reserves Total
losses over the next life (no credit the entire duration (credit
12 months impairment) impairment occurred)
Balance as at January
1,018,014.40 15,111,246.32 16,129,260.71
1,2021
Balance as at January
—— —— —— ——
1,2021 In current
Provision in the current 369,750.00 369,750.00
255
2021 Annual Report
period
Balance as at
1,387,764.39 15,111,246.32 16,499,010.71
December 31,2021
Loss provision changes in current period, change in book balance with significant amount
□ Applicable √ Not applicable
Disclosure by aging
In RMB
Aging Closing balance
Within 1 year(Including 1 year） 15,603,247.29
1-2 years 0.00
2-3 years 234,716.25
Over 3 years 15,044,678.85
3-4 years 328,819.35
4-5 years 454,759.77
Over 5 years 14,261,099.73
Total 30,882,642.39
3) Accounts receivable withdraw, reversed or collected during the reporting period
The withdrawal amount of the bad debt provision：
In RMB
Amount of change in the current period
Opening Reversed or
Category Closing balance
balance Accrual collected Write-off Other
amount
Internal current
877,680.00 365,000.00 1,242,680.00
account
Deposit 5,000.00 5,000.00
Other 1,260.00 122.36 1,382.36
15,245,320.
Unit account 4,627.64 15,249,948.35
71
16,129,260.
Total 369,750.00 16,499,010.71
71
Where the significant amount of the provision for bad debt recovered or reversed
In RMB
Name Amount Mode
256
2021 Annual Report
4) Accounts receivable actually written off in the reporting period
In RMB
Items Amount
Of which the significant amount of the reversed or collected part during the reporting period :
In RMB
Whether the
Verification money is
Name Nature Amount Reason procedures generated by
performed related party
transactions
(5)Top 5 of the closing balance of the other accounts receivable collected according to the arrears party
In RMB
Portion in total Bad debt provision
Name Nature Year-end balance Age other of year-end
receivables(%) balance
Shenzhen Beauty
Internal current
Century Garment 14,475,600.00 1-3 years 46.87% 1,242,680.00
account
Co., Ltd.
Jiangxi Xuanli
Unit account 11,389,044.60 Over 5 years 36.88% 11,389,044.60
Thread Co., Ltd.
Anhui Huapeng
Unit account 1,800,000.00 Over 5 years 5.83% 1,800,000.00
Textile Company
Shenzhen Dailisi
Unit account 1,100,000.00 Within 1 year 3.56% 55,000.00
Underwear Co., Ltd
Shenzhen Xieli
Automobile Repair Unit account 1,018,295.37 2-5 years 3.30% 1,018,295.37
Plant
Total -- 29,782,939.97 -- 96.44% 15,505,019.97
6) Accounts receivable involved with government subsidies
In RMB
Name of the Time, amount and
Name government subsidy Year-end balance Aging basis of the expected
project collection
The company has no government subsidies receivable.
257
2021 Annual Report
7) Other account receivable which terminate the recognition owning to the transfer of the financial assets
(8) The amount of the assets and liabilities formed by the transfer and the continues involvement of other accounts
receivable
Other note：
3. Long-term equity investment
In RMB
Closing balance Opening balance
Items Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
1,972,630,835. 1,956,048,206. 1,972,630,835. 1,956,048,206.
Investments in 16,582,629.30 16,582,629.30
subsidiaries 39 09 39 09
Investments in
associates and 133,022,325.77 0.00 133,022,325.77 147,929,137.23 0.00 147,929,137.23
joint ventures
2,105,653,161. 2,089,070,531. 2,120,559,972. 2,103,977,343.
16,582,629.30 16,582,629.30
Total 16 86 62 32
（1）Investment to the subsidiary
In RMB
Increase /decrease in reporting period Closing
Opening Withdrawn Closing balance of
Name Add Decreased
balance impairment Other balance impairment
investment investment
provision provision
SAPO 1,910,247,78 1,910,247,78 14,415,288.0
Photoelectric 1.94 1.94 9
Shenzhen Lisi
Industrial
8,073,388.25 8,073,388.25
Development
Co., Ltd.
Shenzhen
Beauty
14,696,874.3 14,696,874.3
Century 2,167,341.21
4 4
Garment Co.,
Ltd.
Shenzhen
15,489,351.0 15,489,351.0
Huaqiang
8 8
Hotel
258
2021 Annual Report
Shenzhen
Shenfang
Real Estate 1,713,186.55 1,713,186.55
Management
Co., Ltd.
Shenzhen
Shenfang
Sungang Real
5,827,623.93 5,827,623.93
Estate
Management
Co., Ltd.
1,956,048,20 1,956,048,20 16,582,629.3
Total
6.09 6.09 0
（2）Investment to joint ventures and associated enterprises
In RMB
Increase /decrease in reporting period Closing
Adjust Declara Withdr balance
Openin Decreas Gain/lo ment of tion of awn of
Add Other Closing
Name g ed ss of other cash impair impair
investm equity Other balance
balance investm Investm compre dividen ment ment
ent changes
ent ent hensive ds or provisi provisi
income profit on on
I. Joint ventures
Anhui
Huapen
g 10,797, 10,797,
Textile 023.14 023.14
Co.,Ltd
.
Shenzh
en
Guanhu
a 127,90 128,21
308,06
Printin 6,165.1 4,225.5
0.37
g& 7 4
Dyeing
Co.,
Ltd.
Subtota 138,70 10,797, 308,06 128,21
l 3,188.3 023.14 0.37 4,225.5
259
2021 Annual Report
1 4
II. Associated enterprises
Shenzh
en
Changli
anfa
2,706,2 265,94 2,972,2
Printin
62.38 0.59 02.97
g and
dyeing
Compa
ny
Jordan
Garnent
Factory
Yehui
Internat
6,519,6 -540,01 -199,06 3,944,7 1,835,8
ional
86.54 6.30 3.73 09.25 97.26
Co.,
Ltd.
Subtota 9,225,9 -274,07 -199,06 3,944,7 4,808,1
l 48.92 5.71 3.73 09.25 00.23
147,92 133,02
Total 9,137.2 2,325.7 0.00
3 7
（3）Other note
4.Business income and Business cost
In RMB
Amount of current period Amount of previous period
Items
Business income Business cost Business income Business cost
Income from Main
74,272,555.42 7,660,814.11 57,649,817.53 7,019,203.76
Business
Other Business income 3,887,130.77 3,887,130.77 3,647,070.68 3,647,070.68
Total 78,159,686.19 11,547,944.88 61,296,888.21 10,666,274.44
Income-related information:
In RMB
Type Division 1 Division 2 Total
Of which：
Of which：
260
2021 Annual Report
Of which：
Of which：
Of which：
Of which：
Of which：
Information related to performance obligations: None
Information related to the transaction price apportioned to the residual performance obligation: None
At the end of the reporting period, the income amount corresponding to the performance obligations that have
been signed but not fulfilled or completed is 0.00 yuan. Among them, RMB 0.00 is expected to be recognized as
revenue in 0 year, RMB 0.00 is expected to be recognized as revenue in 0 year, and RMB 0.00 is expected to be
recognized as revenue in 0 year.
Other note: None
5.Investment income
In RMB
Items Amount of current period Amount of previous period
Income from long-term equity investment
18,304,138.91
measured by adopting the Cost method
Income from long-term equity investment
33,984.66 -3,446,613.86
measured by adopting the equity method
Investment income from the disposal of
20,779.93
long-term equity investment
Dividend income earned during
investment holdings in other equity 1,659,743.65 1,995,042.32
instruments
Structured deposit interest 4,036,968.43 14,919,678.58
Net monetary gains 14,657,621.81 3,884,233.70
Total 20,409,098.48 35,656,479.65
6.Other
XVIII. Supplement information
1. Particulars about current non-recurring gains and loss
√ Applicable □Not applicable
In RMB
Items Amount Notes
Non-current asset disposal gain/loss -961,982.35
261
2021 Annual Report
Government subsidy recognized in current
Other benefits of government subsidies
gain and loss(excluding those closely
19,643,379.33 that are confirmed related to the main
related to the Company’s business and
business.
granted under the state’s policies)
Switch back of provision for depreciation
of account receivable which was singly 989,313.04
taken depreciation test.
Other non-business income and
19,964,046.87
expenditures other than the above
Less :Influenced amount of income tax 6,025,891.12
Influenced amount of minor
13,096,494.74
shareholders’ equity (after tax)
Total 20,512,371.03 --
Details of other profit and loss items that meet the non-recurring profit and loss definition
□ Applicable√ Not applicable
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in
the Explanatory Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the
Public-Extraordinary Gains and Losses, or classifies any extraordinary gain/loss item mentioned in the said
explanatory announcement as a recurrent gain/loss item.
□ Applicable √Not applicable
2. Return on net asset and earnings per share
Earnings per share
Profit of report period Weighted average returns equity(%) Basic earnings per Diluted earnings per
share(RMB/share） share(RMB/share)
Net profit attributable to the
Common stock shareholders of 2.24% 0.12 0.12
Company.
Net profit attributable to the
Common stock shareholders of
1.46% 0.08 0.08
Company after deducting of
non-recurring gain/loss.
3. Differences between accounting data under domestic and overseas 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
262
2021 Annual Report
（2）Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese
accounting standards.
□ Applicable□√ Not applicable
(3)Explanation of the reasons for the differences in accounting data under domestic and foreign accounting standa
rds. If the data that has been audited by an overseas audit institution is adjusted for differences, the name of the ov
erseas institution should be indicated
None
4.Other
None
The Board of Directors of Shenzhen Textile (Holdings) Co., Ltd.
March 17, 2021
263
