HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
HEFEI MEILING CO., LTD.
Semi-Annual Report 2016
July 2016
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Supervisory Committee, all directors, supervisors and senior executives of
Hefei Meiling Co., Ltd. (hereinafter referred to as the Company) hereby confirm that there are no
any fictitious statements, misleading statements, or important omissions carried in this report, and
shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the
whole contents.
There is no evidence of declaration in aspect of unable to guarantee or having objections for
the reality, accuracy and completion of whole content of the Report among directors, supervisors
and senior executives.
Profit sharing plan or transfer of reserve to common shares deliberated by the Board in
reporting period
□Applicable √Not applicable
The Company has no plans of cash dividend distribution, bonus sharing and transferring of
reserve to common shares either.
Mr. Liu Tibin, Chairman of the Company, deputy President and financial administrator Mr.
Zhang Xiaolong and Mr. Luo Bo, person in charger of accounting organ (chief accountants) hereby
confirm that the Financial Report of 2016 Semi-Annual Report is authentic, accurate and complete.
All the directors attended the board meeting on Report deliberation in both ways of site and
communication.
Modified audit opinions presentation
□ Applicable √ Not applicable
Financial report of the 2016 semi-annual report has not been audited by CPA
Risk warning of the forward-looking statements with future plans involved in the semi-annual
report
√ Applicable □ Not applicable
Concerning the forward-looking statements with future planning involved in the Report, they
do not constitute a substantial commitment for investors. Investors are advised to exercise caution
of investment risks.
Investors are advised to read the full text of semi-annual report, and pay particular attention to
the following risk factors:
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
More details about the possible risks and countermeasures in the operation of the Company are
described in the report ―IX. Core Competing Capability‖ of ―Section IV Report of Board of
Directors‖, relevant contents attention please.
Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
(www.cninfo.com.cn) are the media for information disclosure for year of 2016 that appointed by
the Company. All public information under the name of the Company disclosed on the above said
media and website shall prevail, and investors are advised to exercise caution.
Directors and senior executives of the Company respectively signed Written Confirmation
Opinions for 2016 Semi-Annual Report.
A Written Examination Opinions for 2016 Semi-Annual Report is made by resolution from
Supervisory Committee of the Company.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Contents
Section I. Important Notice, Contents and Paraphrase .................................................................. 1
Section II Company Profile ...................................................................................................................... 5
Section III. Accounting data and summary of financial indexes .................................................. 7
Section IV Report of the Board of Directors .....................................................................................11
Section V. Important Events .................................................................................................................. 37
Section VI. Changes in Shares and Particulars about Shareholders ........................................ 96
Section VII. Preferred Stock ................................................................................................................ 102
Section VIII. Particular about Directors, Supervisors and Senior Executives .................... 103
Section IX. Financial Report ............................................................................................................... 104
Section X. Documents Available for Reference .............................................................................. 246
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Paraphrase
Items Refers to Contents
Company, the Company or Meiling
Refers to HEFEI MEILING CO., LTD
Electric
Sichuan Changhong or controlling
Refers to Sichuan Changhong Electric Co., LTD
shareholder
Changhong Group Refers to Sichuan Changhong Electronics Holding Group Co., Ltd.
Hong Kong Changhong Refers to CHANGHONG (HK) TRADING LIMITED
Meiling Group Refers to Hefei Meiling Group Holdings Limited
Xingtai Holding Refers to Hefei Xingtai Financial Holding Group Co., Ltd.
Industry Investment Group Refers to Hefei Industry Investment Holding (Group) Co., Ltd.
Shine Wing Refers to Shine Wing Certified Public Accountants Co., Ltd. (LLP)
Changhong Air-conditioner Refers to Sichuan Changhong Air-conditioner Co., Ltd.
Zhongke Meiling Refers to Zhongke Meiling Cryogenic Technology Co., Ltd.
Hongyun Venture Capital Fund Refers to Sichuan Hongyun New IT Venture Capital Fund
Changhong Ridian Refers to Guangdong Changhong Ridian Technology Co., Ltd.
Zhongshan Changhong Refers to Zhongshan Changhong Electric Co., LTD
Changmei Technology Refers to Changmei Technology Co., Ltd.
Huayi Compressor Refers to Huayi Compressor Co., Ltd.
CSRC Refers to China Securities Regulatory Commission
China Securities Regulatory Commission, Anhui Province
Anhui Securities Bureau Refers to
Securities Regulatory Bureau
SSE Refers to Shenzhen Stock Exchange
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section II Company Profile
I. Company profile
MEILINGDIANQI,
Short form of the stock Stock code 000521, 200521
WANMEILING-B
Short form of the Stock after
N/A
changed (if applicable)
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
合肥美菱股份有限公司.
Chinese)
Short form of the Company (in
美菱電器
Chinese)
Foreign name of the Company
HEFEI MEILING CO.,LTD.
(if applicable)
Abbr. of English name of the
HFML
Company (if applicable)
Legal representative Liu Tibin
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Li Xia Zhu Wenjie
No. 2163, Lianhua Road, Economic and No. 2163, Lianhua Road, Economic and
Contact add.
Technology Development Zone, Hefei Technology Development Zone, Hefei
Tel. 0551-62219021 0551-62219021
Fax. 0551-62219021 0551-62219021
e-mail lixia@meiling.com wenjie.zhu@meiling.com
III. Others
1. Way of contact
Whether registrations address, offices address and codes as well as website and email of the
Company changed in reporting period or not
□ Applicable √ Not applicable
Registrations address, offices address and codes as well as website and email of the Company
has no change in reporting period, found more details in Annual Report 2015.
2. Information disclosure and preparation place
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Whether information disclosure and preparation place changed in reporting period or not
□ Applicable √ Not applicable
The newspaper appointed for information disclosure, website for semi-annual report publish
appointed by CSRC and preparation place for semi-annual report have no change in reporting
period, found more details in Annual Report 2015.
3. Registration changes of the Company
Whether registration has changed in reporting period or not
□ Applicable √ Not applicable
Date/place for registration of the Company, registration number for enterprise legal license,
number of taxation registration and organization code have no change in reporting period, found
more details in Annual Report 2015.
4. Other relevant information
Whether other relevant information has changed in reporting period or not
□ Applicable √ Not applicable
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section III. Accounting data and summary of financial indexes
I. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data for
accounting policy changed and accounting error correction or not
√Yes □No
Increase/decre
Same period of last year ase in this
Current period report y-o-y
After
Before adjustment After adjustment
adjustment
Operating revenue (RMB) 6,866,631,262.68 6,426,917,289.25 6,572,479,966.74 4.48%
Net profit attributable to
shareholders of the listed 109,992,701.28 158,369,766.68 158,158,485.22
company(RMB) -30.45%
Net profit attributable to
shareholders of the listed company
90,801,654.71 148,569,574.10 148,569,574.10 -38.88%
after deducting non-recurring gains
and losses(RMB)
Net cash flow arising from operating
871,689,504.89 343,410,987.03 352,373,209.74 147.38%
activities(RMB)
Basic earnings per share
0.2074
(RMB/Share) 0.1440 0.2071 -30.45%
Diluted earnings per share
0.2074
(RMB/Share) 0.1440 0.2071 -30.45%
1.28 percent
Weighted average ROE 3.12% 4.52% 4.40%
point down
Increase/decre
ase in this
End of last period report-end
End of current period over that of
last period-end
After
Before adjustment After adjustment
adjustment
Total assets (RMB) 11,755,975,449.93 9,066,223,601.14 9,237,288,359.74 27.27%
Net assets attributable to shareholder 3,441,401,790.58 3,384,574,993.19 3,475,377,586.34 -0.98%
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
of listed company(RMB)
Notes: the Company succeeded to acquire 98.856% equity interests of Guangdong Changhong
Ridian Technology Co., Ltd (―Changhong Ridian‖) through bidding at the end of 2015, and
completed registration procedures at competent industrial and commercial authority in respect of
this equity transfer at early February 2016. Upon completion of this equity transfer, the Company
was to hold 98.856% equity interests of Changhong Ridian. Under relevant provisions of Enterprise
Accounting Principles No.33-Consolidated Financial Statement, in respect of the subsidiaries and
their businesses acquired arising from business consolidation under the same control during the
reporting period, parent company shall adjust the beginning figures stated in the consolidated
statement and adjust the relevant items in the comparative statement accordingly as if the reporting
entity after the consolidation had been in existence since the time when the ultimate controller
commenced to exercise control. Therefore, the beginning figures and the figures of the
corresponding period of last year have been restated.
Total share capital of the Company up to a trading day before disclosure:
Total share capital of the Company up to a trading day before disclosure (Share) 763,739,205
Fully diluted EPS based on new share capital (RMB/Share) 0.1440
II. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS
(International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting
Principles)
□ Applicable √ Not applicable
The Company has no difference of the net profit and net assets disclosed in financial report,
under both IAS (International Accounting Standards) and Chinese GAAP (Generally Accepted
Accounting Principles) in reporting period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign
accounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
√ Applicable □ Not applicable
In RMB
Net profit attributable to shareholders of Net assets attributable to shareholders of
listed company listed company
Current Period Last Period Period-end Period-begin
Chinese GAAP 109,992,701.28 158,158,485.22 3,441,401,790.58 3,475,377,586.34
Items and amount adjusted by foreign accounting rules
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Foreign accounting rules 109,992,701.28 158,158,485.22 3,441,401,790.58 3,475,377,586.34
The Company has no difference of the net profit and net assets disclosed in financial report,
under both foreign accounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
in reporting period.
3. Reasons for the differences of accounting data under accounting rules in and out of China
√ Applicable □ Not applicable
The ―Notice of Relevant Issues of Audit for Company with Domestically Foreign Shares
Offering‖ was issued from CSRC dated 12 September 2007, since the day issuing, cancel the
previous ―dual audit‖ requirement for companies who offering domestically listed foreign shares
(B-share enterprise) while engaging securities practice qualification CPA for auditing. The
Company did not compile financial report under foreign accounting rules since 2007, the financial
report of the Company is complying on the ―Accounting Standard for Business Enterprise‖ in China,
and therefore, there are no differences of accounting data under accounting rules in and out of
China at period-end.
III. Items and amounts of extraordinary profit (gains)/loss
√ Applicable □ Not applicable
In RMB
Item Amount Note
Gains/losses from the disposal of non-current asset
Found in ―Non-operating
(including the write-off that accrued for impairment of -1,214,295.88
expenditure‖
assets)
Governmental subsidy reckoned into current
gains/losses (not including the subsidy enjoyed in quota Found in ―Non-operating
or ration according to national standards, which are 14,750,673.67 expenditure‖
closely relevant to enterprise’s business)
Held transaction financial asset, gains/losses of changes
of fair values from transaction financial liabilities, and
investment gains from disposal of transaction financial Found in ―Investment
asset, transaction financial liabilities and financial asset 3,707,731.16 income‖ and ―Changes in
available for sales, exclude the effective hedging fair value gains/losses‖
business relevant with normal operations of the
Company
Other non-operating income and expenditure except for Found in ―Non-operating
4,410,917.97
the aforementioned items expenditure‖
Less: Impact on income tax 2,325,980.83 ——
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Impact on minority shareholders’ equity (post-tax) 137,999.52 ——
Total 19,191,046.57 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on
Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary
Profit/loss, and the items defined as recurring profit (gain)/loss according to the lists of
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for
Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, explain reasons
√ Applicable □ Not applicable
Involved amount
Item Reason
(RMB)
During the reporting period, the wholly owned subsidiary -
Mianyang Meiling Software Technology Co., Ltd. has
received VAT refunds of software products according to
"Notice about VAT policy of software products by Ministry
of Finance & State Administration of Taxation" CS No.
[2011] 100 document, and adequately disclosed the
company's business situation, in accordance with relevant
provisions in the third article of the second item of CSRC
Non-operating income
1,705,532.50 "No. 1 explanatory announcement about information
disclosure of the company publicly issues securities -
non-recurring profit and loss (2008)", the public subsidies
which are closely related to the company's business,
conform to the national policies and regulations and
continue to be enjoyed according to a certain standard rating
or quantity should be included in the company's recurring
gains and losses.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section IV Report of the Board of Directors
I. Summary
As for the first half year of 2016, the international and domestic economic environment
remained depressed, experiencing relatively large pressure for downward economy. With respect to
the domestic economy, the growth thereof continued to slow down, showing periodic stability.
According to the information released by the national statistics bureau, our domestic GDP recorded
a year-on-year increase of 6.7% during the first half year of 2016. In respect of the three major
segments driving economic growth, the growth speed of investment segment fell greatly during the
first half year; investment of fixed assets recorded an increase of 9%, representing a decrease of 1.7
percentage point as compared to the first quarter; export segment decreased 2.1%, representing a
decrease of 3.6 percentage point as compared to the first quarter; consumption segment increased
10.3%, which was approximate to the first quarter.
Since 2015 when the home appliances industry has been affected by the declining real estate
operations and the national policy relating to encouraging reducing inventory level of air
conditioners, high level of inventory and pricing competition have limited the development of home
appliances industry in the PRC. As the policy related bonus fades up, the industry begins to recover
its market-oriented nature. On the one hand, as those home appliance products sold during the
period benefiting from related policies approaches to the end of their useful lives, a time for
upgrade and exchange for new products is coming. On the other side, as the living conditions have
improved, market of high-end products trends to expand. Meanwhile, the threshold for market
competition has been further improved as the country has advocated overall application of new
energy efficiency labeling. Besides, challenged by the current development difficulties of the
industry, and with gradual popularity of computers, internet and mobile telecommunicate
equipments, how to enhance product structure and realize efficient transformation has become the
main concern for the whole industry. With assistance of internet, the possibility of internet
connection between items and items, and connection between items and human being become true,
and it is a necessity for the industry to highlight intelligence development. In general, domestic
market capacity of the home appliances industry is shrinking, product structure and energy
efficiency labeling continue to upgrade, and export market remains not optimistic, marking that it is
the essential time for the industry to experience structural transformation.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
During the first half of 2016,under the guidance of the strategy policies of ―Meiling Dream‖
and ―double-three and one-heart‖, the Company adhered to the operating policy of ―striving for
progress in negative environment, innovation, industry benchmarking and positive operation‖. With
hard efforts of the entire staff, the Company succeeded to overcome the negative factors such as
weak macro economy and continuous decline of the overall industry. In specific, the refrigerators
sold in domestic market outperformed the general performance of the industry, e-commerce
recorded substantial growth and export market of refrigerators strengthened the market rankings.
For domestic sales of refrigerators, the Company almost recorded the same results as compared to
the previous year, while experiencing a relatively rapid growth for export sales. Washing machine
business was witnessed with rapid development. As for the business segment of kitchen &
bathroom appliances, the Company realized fast growth. For the first half year of 2016, the
Company realized operating income of RMB 6.867 billion, representing a year-on-year increase of
4.84%; the net profit attributable to parent company was RMB 109.9927 million, representing a
year-on-year decrease of 30.45%.
II. Analysis on major operations
(I) Summary
Shows no difference with the summary disclosed in Report of the Board of Director
□Yes √ No
For the period from January to June 2016, business of refrigerator and freezing box realized
operating revenue of RMB 3.512 billion approximately with a decrease of 0.02% y-o-y;
air-conditioner business achieved revenue of RMB 2.579 billion approximately, a 5.61% growth
y-o-y; washing machine gains RMB 0.214 billion approximately with a 62.23% growth y-o-y; other
business as kitchen & bath as well as small appliances achieved revenue of RMB 0.330 billion
approximately, a 51.74% growth y-o-y. Meanwhile, the Company gains a revenue of RMB 1.635
billion in exportation with a y-o-y growth of 24.66%.
(II) Year-on-year changes of main financial data
In RMB
Y-o-y
Same period of last
Current period increase/dec Reasons for changes
year
rease
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Operation revenue 6,866,631,262.68 6,572,479,966.74 4.48% ——
Operation cost 5,432,461,687.10 5,213,492,703.53 4.20% ——
Sales expenses 1,075,647,750.60 956,768,853.62 12.43% ——
Administrative
193,280,424.74 197,283,986.21 ——
expenses -2.03%
Financial cost -39,699,342.16 -45,676,072.58 13.09% ——
Income tax expense 18,816,185.98 14,512,173.60 29.66% ——
R&D expenses 207,876,418.69 206,928,659.96 0.46% ——
Net cash flow
Sales amount received in the period increased on
arising from 871,689,504.89 352,373,209.74 147.38%
a y-o-y basis
operation activities
Net cash flow
The mature trust management principal
arising from 374,877,700.49 -67,121,031.19 658.51%
received in the period increased on a y-o-y basis
investment activities
Net cash flow
The short-term loans paid by parent company
arising from 682,926,101.22 -174,734,971.75 490.84%
decreased on a y-o-y basis
financing activities
Net increase of cash The mature trust management principal and bank
1,941,723,175.47 120,230,154.61 1,515.01%
and cash equivalent loans received in the period increased
Same reasons as ―Net increase of cash and cash
Monetary fund 4,136,998,121.62 2,135,189,879.15 93.75%
equivalent‖
Financial assets
measured by fair
value and whose Fair value changes of the forward foreign
2,340,308.20 - 100.00%
change is recorded exchange contract carried out in the Period
in current gains and
losses
Proportion of sales of the credit customer
Account receivables 1,950,050,884.81 1,338,396,321.83 45.70%
increased on a y-o-y basis in the period
The accrued interest of the fixed deposit under
Interest receivable 1,896,655.82 1,238,199.65 53.18% the name of subsidiary Zhongshan Changhong
are recognized
The principal of trust management are received
Other current assets 30,440,120.40 539,101,578.44 -94.35%
in the period by parent company for mature
Parent company’s short-term loans increased in
Short-term loans 718,762,164.03 58,680,093.19 1,124.88%
the period
Financial liabilities
Same reasons as ―Financial assets measured by
measured by fair
3,618,878.41 - 100.00% fair value and whose change is recorded in
value and whose
current gains and losses‖
change is recorded
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
in current gains and
losses
The note payable un-mature temporary increased
Note payable 2,834,242,595.61 2,172,064,923.79 30.49%
at end of the period
Purchasing in production peak season increased
Account payable 2,340,133,319.01 1,604,075,191.50 45.89%
in the Period
Salary and year-end bonus which are accrued last
Wages payable 78,227,521.05 115,297,429.40 -32.15%
year are distribute in this period
VAT payable at period-end increased over that of
Taxes payable 188,830,607.86 70,530,483.54 167.73% period-begin due to the sales peak season in this
period
Loan interest are pay in the period from parent
Interest payable 35,547.83 214,328.89 -83.41%
company
Other account
970,734,230.21 643,567,087.33 50.84% Other payables at period-end increased
payable
Non-current liability Long-term loans due within one year are
261,130,799.00 11,153,067.68 2,241.34%
due within one year transfer-in for re-classify
Long-term loans due within one year are
Long-term loans 50,290,088.80 243,004,866.40 -79.30%
transfer-out for re-classify
Other
Rate in foreign currency changed from foreign
comprehensive -466,043.54 -2,280,500.61 79.56%
subsidiaries
income
Subsidiary absorb the capital contributed by
Minority interests 63,598,515.16 36,290,904.66 75.25%
minority in the period
Business tax and
62,141,577.47 45,722,966.65 35.91% The surcharge tax of the VAT payable increased
surcharge
Changing income of Loses of fair value changes of the forward
fair value(Loss is -1,278,570.21 3,653,270.00 -135.00% foreign exchange contract carried out in the
listed with ―-‖) Period
Investment income Income of trust management received in the
(Loss is listed with 4,153,090.95 -5,484,432.72 175.73% period and the losses from affiliated business
―-‖) decreased on a y-o-y basis
Investment income
on affiliated Losses from affiliated business decreased on a
-833,210.42 -6,482,572.94 87.15%
company and joint y-o-y basis
venture
Non-operating Government grants received in the period
21,471,702.44 15,011,187.86 43.04%
revenue increased on a y-o-y basis
Income of
Income from disposal of fixed assets increased in
non-current assets 330,833.76 14,784.00 2,137.78%
the period on a y-o-y basis
disposal
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Non-operating Losses from disposal of fixed assets decreased in
1,818,874.18 9,268,395.87 -80.38%
expense the period on a y-o-y basis。
Losses of
non-current assets 1,545,129.64 5,700,586.03 -72.90% Same reasons as ―Non-operating expense‖
disposal
Net profit
attributable to Earnings of the Company decreased y-o-y in the
109,992,701.28 158,158,485.22 -30.45%
owners of parent period
company
Minority Earnings from part of the non-wholly-owned
shareholders’ gains -69,054.44 670,663.11 -110.30% subsidiaries are declined on a y-o-y basis in the
and losses period
(III)Major changes on profit composition or profit resources in reporting period
□ Applicable √ Not applicable
No major changes on profit composition or profit resources occurred in reporting period
(IV)The future development and planning extended to reporting period that published
in disclosure documents as prospectus, private placing memorandum and recapitalize
statement
□ Applicable √ Not applicable
No future development and planning extended to reporting period that published in disclosure
documents as prospectus, private placing memorandum and recapitalize statement
(V)Summary on the progress of the operation plan as disclosed previously by the
Company during the reporting period
During the Period, the Company map out the annual operation plan in line with development
strategy and 2016 business policy, arrange and organized the production, main works are as:
(1) Achieving progress in negative environment
In terms of market competition, the home appliances industry continued to decline in general.
In particular, in respect of the domestic sales of refrigerators for the period from January to June,
the accumulative sales volume recorded a year-on year decrease of 9.29% based on the data
provided by Zhongyikang and sales amount decreased by 7.78%. For Meiling series refrigerators,
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
the sales volume decreased by 2.73% year on year, while the sales amount increased by 1.14%. In
respect of the domestic sales of freezers for the period from January to June, the accumulative sales
volume recorded a year-on year decrease of 15.95% based on the data provided by Zhongyikang
and sales amount decreased by 21.68%. For Meiling series freezers, the sales volume increased by
23.34% year on year, while the sales amount increased by3.27%. Based on these date, it was clear
that our operating results for refrigerators and freezers outperformed the overall market, realizing
progress despite of the negative environment.
In terms of air conditioners, we realized nearly the same results as compared to the previous
year for our domestic sales, while recording rapid growth of our export sales. In particular, in
respect of the domestic sales of air conditioners for the period from January to June, the
accumulative sales volume recorded a year-on year increase of 6.74% based on the data provided by
Zhongyikang and sales amount decreased by 5.84%. For Meiling series air conditioners, the sales
volume increased by 5.11% year on year, while the sales amount increased by 4.91%. In respect of
the overseas sales of air conditioners for the period from January to May, the export sales volume
recorded a year-on year increase of 20.9% based on the data provided by competent custom
authorities and sales amount increased by 8.47%. For Meiling series air conditioners, the export
sales volume increased by 60.3% year on year, while the sales amount increased by 49.6%. In terms
of market share, the market share of our air conditioners export sales amounted to 1.6%,
representing a year-on-year increase of 0.4 percentage points.
(2) Innovation
During the first half year of 2016, the Company strengthened performance review under KPI
system through transforming its operating ideas and thinking pattern based on value-oriented
principles. It designed sharing curve, introduced labor-hour-based efficiency review model, detailed
incentive units and encouraged to pursue win-win achievement combining individual performance
and overall performance, which in turn inspired competitiveness of each business segment.
Meanwhile, the Company also actively reinforced design, argumentation and implementation of
incentive plans of each business segment, expecting to fully inspire staff’s enthusiasm for works
and helping the Company to realize its plan for 2016 and the thirteenth-five year plan.
During the reporting period, the Company started the plan named Intelligent Ecology Circle.
Under this plan, the Company released CHiQ generation II refrigerators which can realize smart
space combination based on requirements for specific foods and the CHiQ intelligent air
housekeeper which can exchange for new air on an automatic basis. Release of new products further
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
assisted the Company to reinforce innovation of intelligent technology, which in turn helped the
Company to accelerate realization of its intelligence strategy, promotion of transformation and
upgrade, prepare itself for new competition layout and enhance the core competitiveness.
(3) Industry benchmarking
The Company mainly focused on management benchmarking in market position, R&D cycle
and enhance of efficiency in the first half year of 2016. In specific, market share of refrigerators in
domestic market recorded a year-on-year increase of 0.65 percentage points; the actual baseline of
R&D capability improved by 22.6%; organization optimization through separation of platform
function and business supports has been explored in terms of human-based efficiency enhancement;
as for materials-based efficiency enhancement, the inventory turnover rate rose by over 10% for the
first half year by means of increasing coordination between production and sales, strictly controlling
production reserve and continuously digesting non-performing or slow-moving inventories; as for
money-based efficiency enhancement, it made proper use of capital stock, explored to increase
capital and increased financial return.
(4)Operation in good manner
In terms of corporate operation, the Company connected through its value chain, detailed
calculation management and improved overall management and alarming ability. Besides, it
emphasized sales operation in good manner, further strengthened management over terminal pricing,
strictly controlling fixed expenses within the budget during the first half year of 2016.
In addition, the Company continued to optimize the industry chain and product line of home
appliance products. It acquired equity interests of Changhong Ridian through bidding, which
enabled it to own platform offering independently-developed kitchen & bathroom and mini home
appliance products. During the reporting period, the Company has further strengthened operation in
segment of kitchen & bathroom and mini home appliance products. Through adjusting organization
structure and establishing product center, it realized integration of product planning, R&D and cost
control. As for our smart mini home appliance products, we mainly focused on the characters of
practicing and easy-to-operate. At the same time, we also experienced rapid development of
e-commerce of mini home appliance products.
Besides, in front of the general transformation for intelligent operation in the home appliance
industry, the Company actively explored new ways to further develop transformation of home
appliance enterprises with assistance of internet technology and released the first Intelligent
17
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Ecology Circle plan, pursuant to which, it started to develop new business model catering for needs
for foods, air and water. During the reporting period, we made smooth progress in improving our
capability of manufacturing intelligent products. Release of the new generation intelligent and
variable-frequency products was partly attributable to our investment in research and development
of intelligent products, proving that the relevant result was obviously positive. Our smart life project
was promoted as scheduled. In detail, we completed establishment of Changmei Science and
Technology Co., Ltd which was equipped with two operating units locating at Mianyang and Hefei
respectively. The Company operates its own fresh products e-commerce brand-ifoodtube which has
absorbed approximate 60,000 registered members contributing about 2,000 orders each day.
III. Constitution of main business
In RMB
Increase or Increase or Increase or
decrease of decrease of decrease of
Gross
operating operating cost gross profit
Operating revenue Operating cost profit
revenue over over same ratio over same
ratio
same period of period of last period of last
last year year year
According to industries
Manufacture of
household 6,635,243,672.98 5,226,428,116.77 21.23% 5.26% 5.01% 0.18%
appliances
According to products
Refrigerators,
3,511,755,682.66 2,641,347,914.01
freezers 24.79% -0.02% -2.51% 1.93%
Air
2,578,582,275.76 2,117,657,552.65
conditioning 17.88% 5.61% 7.30% -1.29%
Washing
214,447,675.62 174,849,330.14
machine 18.47% 62.23% 61.93% 0.15%
Others 330,458,038.94 292,573,319.97 11.46% 51.74% 57.22% -3.09%
According to region
Domestic 4,999,875,111.36 3,763,161,367.63 24.73% 0.16% -0.58% 0.55%
Foreign 1,635,368,561.62 1,463,266,749.14 10.52% 24.66% 22.76% 1.38%
IV. Core Competing Capability
(I)Company strength
1. Brand capacity
18
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Our Company is one of the well-known electrical appliances manufacturers in China, owning
various product lines covering refrigerator, freezer, air conditioner, washing machine and mini
home appliances. Meiling trademark is the famous trademark across China and Meiling brand has
been listed as one of the most valuable brands in China. Athena trademark used by the Company I
its refrigerators and freezer products or services has been also viewed as the well-known trademark
of Anhui province. Till date since 2014, the Company has released CHiQ intelligent generation I
and II refrigerators, air conditioners and smart air management products, aiming to build a high-end
intelligent brand remarking for a new era of electrical appliances. Meanwhile, targeting to improve
the brand image, and further to enlarge brand market influence, the Company holding a conference
of a new LOGO release and ten million frequency conversion products offline in October 2015.
Completely renew the new LOGO ― ‖, and implemented a new brand view of
―Meiling, welcome the good life‖. Following the new LOGO release, the ―Good life trilogy‖ brand
strategy are carrying out at the same time, that is from ―good experience‖ (the sense-oriented) to
―good enjoyment‖ (the spirit-oriented) and up to ―good faith‖ (the faith of life-oriented).
By our efforts to rebuild our brand, Meiling will realize a young, international and professional
brand image. Through gradual construction of the ideas of Wonderful Start Point, Wonderful Life
Circle and Wonderful Ecology Circle, Meiling has become a people-oriented artist specializing in
white appliances, a smarter scientific expert and a more reliable house keeper.
2. Product capacity
For the last 30 years, the Company has been focusing on refrigeration industry developing
various different types of refrigerator products, including multi-door Athena series high-end
refrigerator, superior green refrigerator with daily power consumption of merely 0.23 degree,
frequent refrigerator equipped with accurate variable-frequency technology consuming power of 0.1
degree, CHiQ refrigerator with the core technology of ―cloud image identification‖ and CHiQ air
conditioner based on the technology of human sense. In June 2016, the Company further officially
released various intelligent products leading the development popularity among the industry,
including CHiQ refrigerator generation II combining two technologies namely coldness capacity
smart allocation technology and ETC (Electrical Thinking Card) smart identification technology,
and the CHiQ intelligent air management products featured with SAW (Self All Weather)
technology.
The Company owned an advanced and perfect R&D and quality assurance systems, approved
the management system certification of ISO9001, ISO14001 and OHSAS18001. Products of the
Company have good quality and reliable capacities. As for technology development, the Company
19
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
owned a national technology center, and vigorously increase input in basic technology study; in
aspect of energy-saving, air cooling, frequency conversion, intelligence and cryogenic process, the
Company owns an advanced core technology that ahead of others in the industry. In respect of
product development, the Company paid more attention to specific design considering technology
development trend and consumers’ need for pursuit for better products , thus to increase
development investment in middle and high end products including air freezing, multi-temperature,
large capacity, variable-frequency and smart products, helping the Company to realize obvious
upgrade of product structure. The Company will continue to adhere to strategic development of the
two major products, namely intelligent and variable-frequency products. Through promoting
subsequent R&D, promotion and technology upgrade of intelligent and variable-frequency products,
the Company was enabled to gradually transform to a high-end manufacturer. Meanwhile, it
succeeded to cut down product costs and increase competitiveness through overall implementation
of intelligent improvement, production efficiency enhancement and product quality. Furthermore,
the Company will constantly improving its appliance products, layout the kitchen and bath as well
as home ware in purpose of creating integrated household appliance enterprises.
Meanwhile, the Company accelerated to optimize product structure, drive forward
transformation, and explore the new value-added service model of home appliance enterprises with
assistance of internet technology. The Company started the non-public offering project to raise
funds for implementation of the Smart Life project. Through constructing the O2O community fresh
business platform of Meiling’s Smart Life project, the Company made new business trial catering
for needs of food, air and water with its own hardware products as the terminals, targeting to
facilitate its transformation.
3. Operation capacity
The Company conducted benchmark management to improve its basic management level. In
specific, efficiency enhancement has been made in areas of personnel, money and materials, trying
to continuously enhance the internal management. A performance review and sharing system has
been established with clear target and quantity index based on performance, thus to inspire the
internal production capacity. Under the mainline of value chain management, the Company
continued to carry out value creation and improve its competitiveness. Its ability to prevent risks has
been also strengthened through continuous improvement of internal control system.
4. Marketing capacity
The Company has established relatively perfect distribution network and service system. As
for domestic distribution channels, the Company strengthened its competitiveness through
20
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
coordination between online and offline channels, recording balanced development among chain,
wholesale and e-commerce. As for overseas market, the Company increased investments in
overseas marketing institutions, R&D bases and production bases, products exporting to over 130
countries and regions across the globe.
(II) Potential risks
In the later half year 2016, environment for enterprises to survive would be much more worse
in front of the pessimistic macro economic situation and increasingly furious market competition of
home appliance industry. In future, the Company will be exposed to weak growth of macro
economy, severe industrial condition, increasing competition, rising costs and impact from new
business model and era of internet.
First, slowing growth of national economy has become normal, with citizen’s consumption
confidence declining. During the time after the end of the national policy relating to home
appliances in favor of rural areas, market demand for home appliances experienced decreasing. In
case that future economic growth continues to slow down or even depresses, market demands and
gross margin of home appliance industry may decline, which in turn adversely affect the Company’s
profitability. Secondly, the Industry has been in a tough time to make growth challenged by the
furious market competition and overall decline of the whole industry. Increasing market
competition may lead to irrational competition, resulting in operating risks. Thirdly, the profitability
of the Company is adversely affected due to recovery of raw materials price. Lastly, the traditional
business model may not be able to support sustainable development of an enterprise in the new
economic environment. How to upgrade products and to realize transformation has remained as the
major development subjects in case that the operating scale stops expanding and the general
conditions are not optimistic. To develop intelligent products has become the new highlight and
developing trend of the industry under the background of internet work.
Challenged by the above risks, the Company will improve awareness of risk prevention and
make advanced allocation in terms of product, technology and market. As the three major projects
named intelligent manufacturing, intelligent R&D and Intelligent life progresses as scheduled, the
Company is transforming to offer high-end intelligent products. In addition to by adherence to the
strategy of developing intelligent and variable-frequency products, the Company also diversifies
products line to be a comprehensive home appliance enterprise. Further, it strengthens research and
development in technologies relating to intelligence, variable-frequency, air coldness and deep
coldness. It also pays much attention to overseas market since it views that the future development
21
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
potential thereof could be very large, so it actively explores to construction of the own brand in
overseas market. Besides, the intelligent life project is steadily promoted. In particular, an O2O
fresh products e-commerce platform within communities has been established to emphasize
individuation. The Company also improves human resources planning. On the other side, under
guidance of the board of directors and the idea of Meiling Dream, the Company executes the
operating policy of ―striving for progress in negative environment, innovation, industry
benchmarking and positive operation‖. Based on the platform of globalization, the Company
continued to improve management, increase innovation of intelligent technology, speed up the
strategy of intelligent development, reinforce external cooperation, promote transformation,
welcome new pattern of competition and improve the comprehensive profitability. Meanwhile, the
Company made new business trial catering for needs of food, air and water with its own hardware
products as the terminals, thus to realize sustainable development of the Company.
(III) Operating countermeasures for the second half year
1. Operating policy
For the later half year, the Company will continue to adhere to the operating policy of ―striving
for progress in negative environment, innovation, industry benchmarking and positive operation‖.
To response to the deteriorating macro and industrial conditions, the Company focuses on
maintaining targets and stable growth. Meanwhile through carrying out efficiency enhancement in
terms of personnel, materials and money, its comprehensive competitiveness is strengthened with
enhanced ability of technology innovation and management innovation, thus to realize sustainable
development.
2. Market strategy
In respect of domestic market, the Company will reinforce construction of domestic
distribution channels, cooperation between online and offline resources, increase competitiveness,
enhance ability of terminal sales and operation management. In addition, marketing continues to
switch to internet model, realizing sustainable development with innovative promotion forms based
on internet.
In respect of overseas market, it develops overseas brand business through continuous
investments in overseas marketing institutions, R&D bases and production bases. In terms of
products, it adheres to the strategy of developing products with advantage of cost efficiency and
developing those products for which competition is not so furious featuring with different
22
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
characteristics. In terms of channels, it makes adjustment to region and customer structure, focusing
on major clients and increasing satisfaction of overseas customers. In terms of brand, it adheres to
the branding structure of ―independently-developed brands + OEM/ODM‖, and continues to
improve the comprehensive competitiveness of exported products, seeking for bigger growth in
international market.
3. Products strategy
(1)Refrigerator/freezer
In addition to continuous developing the two major series products - intelligent and
variable-frequency products, the Company accelerates to develop and upgrade new generation
intelligent products under its development strategy, and improve market share of variable-frequency
products. It continues to increase research and development of technologies relating to intelligent,
variable-frequency, deep coldness and frost-free, making itself leading the market. Besides,
development for air coldness, multi-temperature, variable-frequency and intelligent products is also
reinforced, driving the Company to transform to be a high-end intelligent enterprise. Meanwhile,
product cost has been reduced to improve competitiveness through overall implementation of
intelligent upgrade and improvement of manufacturing efficient and product quality.
(2)Air conditioner
With respect to air conditioner segment, under the development planning concerning basic core
technology for air conditioner products, the Company focuses on completing research and
development of core technologies relating to intelligent coordination and smart air management, in
order to principally develop intelligent products and air management system, thus to promote
product structure upgrade. Besides, it has introduced new technology and equipments in relation to
centralized air conditioner to follow the major products trend of this industry and realize sales
breakthrough. Under the background of ―Internet+‖, the Company will pull forward its
transformation based on market demands, and will improve the efficiency of whole value chain
through improved operation. As for its core businesses, it ensures to maintain the foundation stable
by means of steady operation. As for emerging business, it will endeavor to capitalize every
opportunity to build platform and concentrate resources to maintain satisfactory scale. As for export
business, it will improve operating scale and control costs , increase revenue.
(3)Washing machine
For washing machine business segment, the Company will accelerate distribution arrangement,
23
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
improve R&D capability and realize rapid upgrade of image and sales volume of our products.
Professional team will be established soon with the expectation of optimizing definition of its
products and strengthening integration of supply chain. Through merger & acquisition or
constructing its own production bases, the Company plans to become the second level of washing
machine brand in the future three to five years, making this business segment one of its pillar
industries.
(4)Mini appliances
Under the strategic development of intelligent products, this business segment insists on
developing intelligent mini appliances relying on the Company’s strong R&D and innovation
capability, thus taking the leading position in intelligent appliances market. Meanwhile, the water
purification business has been established as the core business of mini appliance segment catering
the needs for kitchen and bathroom. In addition, by adherence to the operating idea of ―based on
requirements for kitchen and bathroom, develop mini appliance, innovative operation and improve
ability‖, the Company continues to adopt innovative management, marketing and model, improve
its own ability of manufacturing, strengthen terminals, emphasize on breakthrough, diversify
product line, reinforce construction of staff resources, expand distribution channels, increase
promotion as well as enhance competitiveness of products, operation management and terminal
sale.
(5) Fresh products e-commerce emerging business
According to the idea of Meiling smart life under intelligent communities emphasizing
community, fresh and O2O, the Company has started the fresh products based O2O business
offering self service in communities. On the one side, it adopts the strategy of regionalization and
localization, managing to develop specialized products by means of direct access to production
bases, cooperation with those bases and combination of diversified products, in order to improve the
competitiveness of the platform. On the other side, the Company will take full advantage in the
areas of intelligent and refrigeration, allocating self service freezers in communities, and conduct
continuous experiments in bases, community promotion and product experiment to concentrate
users and communities, not to mention this self service freezers may efficiently cut down logistics
costs. The ultimate purpose is to build our Meiling smart life project as the national smart life O2O
service platform. By means of food management, the Company is gradually transforming to the
business model of ―equipment + service‖, assisting the Company to change to a high-frequency
service provider from a low-frequency hardware distributor, thus to form double growth engines
24
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
with ―hardware + service‖, driving transformation of the Company’s profit-making model.
The above operating plans and targets do not represent the profit forecast of the listed issuer
for 2016. Whether the plans and targets could be achieved depend on various factors such as change
of market conditions and efforts by the operating group, which is subject to large uncertainty.
Investors should be aware of this warning before making investment.
V. Investment analysis
1. Outward equity investment
(1) Outward investment
√ Applicable □ Not applicable
Outward investment
Investment in the reporting period Investment in the same period of
Changes
(RMB) last year’s (RMB)
140,650,000 40,000,000 251.63%
Invested company
Equity proportion
Name Main business in invested company
for Listed company
R&D, production and sales of: household electric appliances,
Guangdong non-electrical household appliance, kitchen & bathroom furniture,
Changhong Ridian audio-visual equipment, radio & television equipment, computers,
98.856%
Technology Co., communication and other electronic devices; software and IT services;
Ltd. business management advisory service; goods and technology import
and export
Development, production and sales of computer hardware & software,
technology development, production and sales of internet of Things
equipment, development and maintenance of E-commerce software,
Changmei
information service, technical transfer and services of the internet,
Technology Co., 90%
domestic AD designing, production, agencies and release, sales of
Ltd.
prepackaged food, dairy products, general merchandise, alcohol,
beverage and agricultural products, crop planting, self-support goods and
technology import and export business.
(2) Holding equity of financial enterprise
√ Applicable □ Not applicable
25
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Proportion
Shares held Shares held Proportion Gains/losses
Initial of shares Book value at
at at of shares in report Accounting
Name Type investment held at period-end Resources
period-begin period-end held at period items
capital (RMB) period-beg (RMB)
(Share) (Share) period-end (RMB)
in
Available
Huishang Comme
for sale Initial
Bank Co., rcial 5,000,000.00 10,737,573 0.0972% 10,737,573 0.0972% 5,000,000.00 0
financial investment
Ltd. bank
assets
Total 5,000,000.00 10,737,573 -- 10,737,573 -- 5,000,000.00 0 -- --
(3) Security investment
□ Applicable √ Not applicable
No security investment in Period.
(4) Explanation on equity of other listed company held
□ Applicable √ Not applicable
The Company had no equity of other listed company held in Period.
2. Trust financing, derivative investment and trust loans
26
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(1) Trust financing
√ Applicable □ Not applicable
In 10 thousand Yuan
Relat Amount of
Whether Trust Principal
ed reserve for Actual
related financi Criteria for actually Anticipate
Name relati Type Start date End date devaluation of gains/losses
trade or ng fixing reward collected in the d income
onshi withdrawing in period
not amount Period
p (if applicable)
Anhui
Province
branch of Floating Expected 3.9%
N/A No 50,000 2015-10-20 2016-1-19 50,000 - 486.16 498.63
Bank of proceeds annual yield
Communica
tions
Total 50,000 -- -- -- 50,000 - 486.16 498.63
Capital resource Self-owned temporary idle funds
Principal uncollected for overdue and
0
accumulated earnings
Lawsuit involved (if applicable) Not applicable
Disclosure date for approval from the
2015-3-26
Board for trust financing (if applicable)
Disclosure date for approval from
shareholders meeting for trust 2015-4-18
financing (if applicable)
(2) Derivative investment
27
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
√Applicable□Not applicable
In 10 thousand Yuan
Ratio of
Relat Whethe Accrual investment
ed r Investment depreciatio Investment amount at Actual
Initial Purchased Sold in the
Operator relati related Type amount at n reserves amount at period-end in gains/losses
investment Start date End date in the Period Period
onshi trade or period-begin (if period-end net assets of the in period
p not applicable) Company at
period-end
Forward
Financial foreign
N/A No 56,813.32 2016-4-15 2017-4-12 0 56,813.32 0 - 56,813.32 16.51% 0
institution exchange
contract
Total 56,813.32 -- -- 0 56,813.32 0 - 56,813.32 16.51% 0
Capital resource(if applicable) Self-owned capital
Lawsuit involved (if applicable) Not applicable
Disclosure date for approval from the
Board for investment of derivatives 2016-3-19
(if applicable)
Disclosure date for approval from
shareholders meeting for investment 2016-4-7
of derivatives (if applicable)
Risk analysis and controlling Risk analysis:
measures for derivatives holdings in 1. Market risk: domestic and international economic situation changes may lead to exchange rate fluctuations, forward foreign exchange
the Period (including but not limited transactions are under certain market risk. Forward foreign exchange business is aiming to reducing impact on corporate profits by
to market risk, liquidity risk, credit foreign exchange settlement and sale prices, exchange rate fluctuations. The Company will follow up the exchange fluctuation, on the
risks, operation risk and law risks basis of target rate determined from the business, relying on the research of the foreign currency exchange rates, combined with
etc.) prediction of consignments, and burdening ability to price variations due to exchange rate fluctuations, then determine the plan of
28
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
forward foreign exchange contracts, and make dynamic management to the business, to ensure reasonable profit level.
2. Liquidity risk: all foreign exchange transactions are based on a reasonable estimate of the future import and export business, to meet
the requirements of the trade authenticity. In addition, forward foreign exchange transactions are processed with bank credit, will not
affect liquidity of company funds.
3. Bank default risk: if cooperative banks collapse within the contract time, the Company will not be able to transact the original foreign
exchange contracts with contract price, which leads the risk of income uncertainty. Therefore, the banks for foreign exchange funds
trading for the Company including five nationalized banks (Bank of China, Agricultural Bank of China, ICBC, CCB and BOCOM),
joint-equity Chinese-funded banks as CEB, China CITIC Bank and the foreign banks such as Deutsche Bank, UOB and Overseas
Chinese Bank. These banks share a solid strength and management whose failure and the risk of loss may bring to the Company is very
low.
4. Operational risk: improper operation of the person in charge of forward foreign exchange transactions may cause related risk also. The
Company has formulated related management system which defines the operation process and responsibility to prevent and control risks.
5. The legal risks: unclear terms based in contract signed with banks for related transactions may lead legal risks when forward foreign
exchange transactions are processing. The Company will strengthen legal review in aspect of relevant contracts, and choose bank with a
good reputation to carry out this kind of business as to risk control.
Invested derivative products have
The Company determines fair value in accordance with the Chapter VII ―Determination of Fair Value‖ carried in the Accounting
changes in market price or fair value
Standards for Business Enterprises No.22 - Recognition and Measurement of Financial Instruments. Fair-value is basically obtained
in the Period, as for analysis of the
according to prices offered by bank and other pricing services. While fair-value of derivatives is mainly obtained according to the
fair value of derivatives, disclosed
balance between prices given by outstanding contracts and forward prices given by contracts signed during the reporting period with
specific applied methods and
bank. The differences are identified as trading financial assets and liabilities. During the reporting period, forward foreign exchange
correlation assumption and parameter
contracts have actual losses of RMB 0.
setting
Specific principle of the accounting
policy and calculation for derivatives
Not applicable
in the Period compared with last
period in aspect of major changes
Special opinion on derivative Upon inspection, the independent directors of the Company believes that: during the reporting period, the Company carried out its
investment and risk control by foreign exchange forward deals in strict compliance with the standardized operation guidelines for listed issuer on main board (2015
independent directors amended) issued by Shenzhen Stock Exchange, the Articles of Association, Authorization Management of the Company, Management
29
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
System in relating to Foreign Exchange Forward Deals of Hefei Meiling Co., Ltd., and these deals were conducted within the
authorization scope under general shareholders meeting and board meeting. Base on normal business operation, the Company rely on
specific operation business and purpose of avoiding and preventing from exchange risks, the foreign exchange forward deals conducted
by the Company were closely related to its normal operation needs, which was beneficial to prevent the exchange risks exposed by
import and export business and thus met its requirement for operation development. There was no speculative operation, no break of
relevant rules and regulations and relevant business was conducted under corresponding decision-making procedures. Interests of the
Company and entire shareholders, especially minority shareholders, were not prejudiced.
30
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(3) Trust loans
□ Applicable √ Not applicable
No trust loans in Period.
3. Actual usage of raised capitals
√ Applicable □ Not applicable
(1) General usage of raised capital
√ Applicable □ Not applicable
In 10 thousand Yuan
Total raised capitals 117,795.4320
Total raised capital invested in reporting period 790.2657
Total accumulative raised capital invested 91,342.6169
Total raised fund for changes its usage area in
0
report period
Total accumulative raised fund for changes its
0
usage area
Proportion of total accumulative raised fund for
0.00%
changes its usage area
Explanation on general usage of raised capital
All projects invested with raised funds of non-public offering by the Company in 2010 have been completed and
reached the production index. Up to 30 June 2016, the Company has achieved net amount of raised funds of
1,177,954,320 Yuan, total capital interests of 44,731,662 Yuan, a total of 1,222,685,982 Yuan. Accumulative
invest capital for investment projects is 913,426,169 Yuan, the actual supplement working capital is 293,922,619
Yuan. Up to 30 June 2016, account balance of raise funds is 15,337,194 Yuan (of which the amount the
Company has not withdrawn for permanently supplementing the working funds is 312,225 Yuan, and the total
amount to pay the contract and retention money is 15,024,969 Yuan)
(2) Commitments of raised capital
□ Applicable √ Not applicable
(3) Changes of raise capital projects
□ Applicable √ Not applicable
No change of raise capital projects in Period.
31
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(4) Project with fund raised
□ Applicable √ Not applicable
4. Main subsidiary and joint-stock company analysis
√ Applicable □ Not applicable
Main subsidiary and joint-stock company
32
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
In RMB
Name Type Industry Main business Registered capital Total assets Net assets Operation revenue Operation profit Net profit
Zhongke Meiling R&D, manufacturing and
Cryogenic Technology Subsidiary Manufacturing sales of ultra-low 65,000,000 144,020,747.44 102,146,088.06 38,908,381.02 2,590,358.20 2,151,566.44
Co., Ltd. temperature freezer
Jiangxi Meiling Electric Refrigerator and freezer
Subsidiary Manufacturing 50,000,000 192,891,751.72 85,205,138.81 166,931,538.84 -1,552,640.70 98,571.01
Co., Ltd. manufacturing
Mianyang Meiling Refrigerator and freezer
Subsidiary Manufacturing 100,000,000 170,012,273.73 98,721,836.08 126,779,175.44 1,753,417.27 1,726,218.56
Refrigeration Co., Ltd. manufacturing
Sichuan Changhong R&D, manufacturing and
Air-conditioner Co., Subsidiary Manufacturing domestic sales of 200,000,000 2,336,361,095.54 519,805,429.62 1,815,174,534.85 -2,222,944.56 1,096,994.99
Ltd. air-conditioner
R&D, manufacturing and
Zhongshan Changhong
Subsidiary Manufacturing foreign sales of 184,000,000 1,085,826,257.86 239,066,698.54 954,779,516.35 10,528,603.15 6,701,314.33
Electric Co., LTD
air-conditioner
Hefei Meiling Electronic
Sales of white household
Appliance Marketing Subsidiary Manufacturing 55,000,000 553,001,367.61 -305,546,344.27 1,402,136,821.47 -15,778,420.02 -14,982,021.11
appliances
Co., Ltd.
Hefei Meiling Group Sales of white household
Subsidiary Manufacturing 80,000,000 666,649,115.82 82,484,021.50 599,518,905.56 4,208,341.33 4,419,186.24
Holdings Limited appliances ect.
Information
transmission,
Changmei Technology Fresh agriculture products
Subsidiary computer services 50,000,000 20,161,239.33 18,851,094.68 2,064,573.25 -561,395.84 -560,905.32
Co., Ltd. e-business
and software
industry
R&D, manufacturing and
Guangdong Changhong
sales of kitchen & bath,
Ridian Technology Co., Subsidiary Manufacturing 83,000,000 188,877,092.05 94,887,938.05 222,027,059.04 2,837,529.89 3,034,542.05
small appliances and water
Ltd.
filter
33
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
5. Major project with non raised fund
□ Applicable √ Not applicable
The company had no major projects invested by non-raised fund in the reporting period.
VI. Prediction of business performance from January – September 2016
Estimation on accumulative net profit from the beginning of the year to the end of next report period to be
loss probably or the warning of its material change compared with the corresponding period of the last year and
explanation on reason
□ Applicable √ Not applicable
VII. Explanation on “Qualified Opinion” from CPA by the Board and Supervisory
Committee
□ Applicable √ Not applicable
VIII. Explanation from the Board for “Qualified Opinion” of last year’s
□ Applicable √ Not applicable
IX. Implementation of profit distribution in reporting period
Implementation or adjustment of profit distribution plan in reporting period, cash dividend
plan and shares converted from capital reserve in particular
√ Applicable □ Not applicable
On 23 March 2016 and 4 May 2016, the ―Profit Distribution Plan for year of 2015‖ was
deliberated and approved by 19th session of 8th BOD, 10th session of 8th supervisory committee and
AGM of 2015. Independent directors also express independent acceptance opinion for the proposal.
The Company agreed to distribute 0.6 Yuan (tax included) in cash for every 10 shares held by all
shareholders of the Company based on total share capital 763,739,205 shares dated 31 December
2015, took shareholders equity and long-term development requirement of the Company into
consideration overall. Cash dividend of 45,824,352.30 Yuan (tax included, cash dividend
representing 70.62% of the distributable profit for that year) was distributed in total. Total share
capital of the Company remain unchanged after distribution, the remaining retained profit
34
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
740,677,358.60 Yuan accumulated will carry forward for distribution in later years.
The Company disclosed the profit distribution plan for year of 2015 on 9 May 2016 and
implemented the above said plans.
Found more details in Notice: No.2016-027, No.2016-028, No.2016-046 and No.2016-048
published respectively dated 25 March 2016, 5 May 2016 and 9 May 2016 on appointed media
Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
(www.cninfo.com.cn).
Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement
Y
of Article of Association (Y/N):
Well-defined and clearly dividend standards and
Y
proportion (Y/N):
Completed relevant decision-making process and
Y
mechanism (Y/N):
Independent directors perform duties completely and
Y
play a proper role (Y/N):
Minority shareholders have opportunity to express
opinions and demands totally and their legal rights are Y
fully protected (Y/N):
Condition and procedures are compliance and
transparent while the cash bonus policy adjusted or Y
changed (Y/N):
X. Profit distribution plan and capitalizing of common reserve plan for the Period
□ Applicable √ Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from
capital reserve either for the semi-annual year.
XI. Registration of research, communication and interview in reporting period
√ Applicable □ Not applicable
Main information
Date Place Way Type objects discussed and
material provided
35
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Operation of the
Conference Field Company, no
2016-1-7 Institute CITIC Securities Co., Ltd.
room research materials
provided
SWS Research, ABC-CA FUND
MANAGMENT, Orient Securities Asset Operation of the
Conference Field Management Co., Ltd., Nuode Fund Company, no
2016-1-15 Institute
room research Management Co., Ltd., Harvest Fund materials
Management Co., Ltd., CITIC Securities Co., provided
Ltd. and HUAAN Securities
Operation of the
Zheshang Securities Co., Ltd., Chang Xin
Conference Field Company, no
2016-1-22 Institute Asset Management Co., Ltd. and BOCOM
room research materials
Schroders
provided
Operation of the
Conference Field Haitong Securities Co., Ltd. and Hwabao Company, no
2016-1-26 Institute
room research Investment Co., Ltd. materials
provided
Changjiang Securities Co., Ltd., Huatai
Securities Co., Ltd., QILU ASSET
Operation of the
MANAGEMENT, Nuode Fund
Conference Field Company, no
2016-5-11 Institute Management Co., Ltd., Zhongtai Securities
room research materials
Co., Ltd., YIMIN Asset Management Co.,
provided
Ltd., First Seafront Fund Management Co.,
Ltd. and Harfor Fund Management Co., Ltd.
Operation of the
Everbright Securities Asset Management Co.,
Conference Field Company, no
2016-5-24 Institute Ltd. and Minfeng Capital Investment
room research materials
Management Co., Ltd.
provided
Operation of the
Conference Field Company, no
2016-6-16 Institute Guotai Junan Securities Co., Ltd.
room research materials
provided
Operation of the
Conference Field Guangzhou Securities Hengsheng Securities Company, no
2016-6-27 Institute
room research Research materials
provided
36
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section V. Important Events
I. Corporate governance
Actual corporate governance of the Company shows no difference with the Company Law and
requirement of relevant regulations from CSRC.
II. Lawsuits
1. Material lawsuits and arbitration
□ Applicable √ Not applicable
No material lawsuits and arbitration in the reporting
2. Other lawsuits
√ Applicable □Not applicable
To maintain the independence and integrity of "Meiling" trademark and trade name, the
company has launched a series of litigation and arbitration related to "Meiling" trademark, please
see 2014 first quarter report, 2014 semi-annual report, the 2014 annual report disclosed respectively
on April 19, 2014, August 12, 2014, and March 26, 2014 for the relevant progress. Up to now,
Hefei Meiling Household Appliances Co., Ltd., Hefei Meiling Environmental Protection Equipment
Technology Co., Ltd., Hefei Meiling Purifying Equipment Technology Co., Ltd., Hefei Meiling
Electrical Appliances Co., Ltd., Hefei Meiling Cabinet Electrical Appliance Co., Ltd., Hefei
Meiling Vehicle Industry Co., Ltd., Hefei Meiling Communication Technology Co., Ltd. have had
no right to use "Meiling" trademark. Meanwhile, the company has struck the above mentioned
companies’ illegal use of "Meiling" trademark by industry and commerce complaints, civil
litigation, and crime reports to the public security.
III. Questions by media
□Applicable √ Not applicable
No questions by media in Period.
37
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
IV. Bankruptcy reorganization
□Applicable √ Not applicable
No bankruptcy reorganization in Period.
V. Assets transaction
1. Acquisition of assets
√ Applicable □Not applicable
38
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Transacti Ratio of net profit Whethe Association
Counterparty/
Acquired on price Impact on profit attributable to r be the relationship with
ultimate Impact on the business of the Date of Index of
/replaced (in 10 Progress and loss of the listed company related counterparty(appl
controlling Company disclosure disclosure
assets thousand Company from such assets in transact y to related
party
Yuan) total net profit ions transaction)
Sichuan
Changhong is the
controlling
shareholder of
the Company, Juchao
It benefits the further integration and Website
Equity Changhong
optimizing household appliances （www.cnin
ownershi Venture Capital
resources, which is up to the mustard fo.com.cn）
Sichuan 98.856% p has is the controlling
of strategy development of the No.:
Changhong equity of transferr Net profit of subsidiary of
Company. Improve household
Electric Co., Guangdon ed, the RMB 2.9998 Sichuan 2015-12-19, 2015-061,
appliance production lines through
LTD, Sichuan g Compan million Changhong, 2015-12-24, No.:
9,565 industry integration of ―white 2.73% Yes
Changhong Changhon y has contributed to the which is regarded 2016-1-5, 2015-062,
household appliances + small
Innovation g Ridian 98.856% listed company in as the affiliated 2016-2-4 No.:
appliances‖, benefit a lot in playing
Investment Technolog equity of the Period legal person 2015-066,
the synergistic effect in the industry,
Co., Ltd. y Co., Ltd. Changho regulated in No.:
enhancing the comprehensive
ng Rules Governing 2015-067,
competitive capacity in the household
Ridian the Listing of No.:
appliances field
Stock on 2016-001
Shenzhen Stock
Exchange clause
10.1.3 (I), (II)
and (III)
39
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
2. Assets sold
□Applicable √ Not applicable
No assets sold in Period.
3. Enterprise combination
□Applicable √ Not applicable
No enterprise combination in Period.
VI. Implementation and its influence of equity incentive plan
□Applicable √ Not applicable
No implementation of equity incentive plan in Period.
VII. Material related transaction
1. Related transaction with daily operation concerned
√ Applicable □Not applicable
(1) Related transaction with routine operation concerned
40
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Trading
Whether
Related Related Proport limit Available
Clearing
Se transactio transaction ion in over the
Type of Content of approved form for similar Date of
Related Pricing n price amount similar
ri Relationship related related approved related Index of disclosure
party principle (in 10 (in 10 transact (in 10 market disclosure
transaction transaction transactio
al thousand thousand ions limited or
thousand n price
Yuan) Yuan) (%)
not (Y/N)
Yuan)
Electric melting,
Spot Juchao
Sichuan Controlling resistors,
exchange, Website(www.cninf
Changhong shareholder Commodity integrated Marketing 2016-3-25
1 7,972.57 7,972.57 1.62% 100,000 No Bank - o.com.cn)No.:2016-
Electric Co., and ultimate purchased circuit price ,2016-5-5
acceptanc 027,2016-028,2015-
LTD controller accessory, color
e 030,2016-046
masterbatch
Other
enterprise
Spot Juchao
control under
Huayi exchange, Website(www.cninf
the same Commodity Compressor, Marketing 2016-3-25
2 Compressor 23,598.52 23,598.52 4.80% 70,000 No Bank - o.com.cn)No.:2016-
controlling purchased door seal price ,2016-5-5
Co., Ltd. acceptanc 027,2016-028,2015-
shareholder
e 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Bank Website(www.cninf
the same Commodity Plastic products Marketing 2016-3-25
3 Mold Plastic 24,724.79 24,724.79 5.03% 100,000 No acceptanc - o.com.cn)No.:2016-
controlling purchased etc. price ,2016-5-5
Tech. Co., e 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
41
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Other
enterprise
Juchao
Sichuan control under
Bank Website(www.cninf
Changhong the same Commodity Door shell, Marketing 2016-3-25
4 11,425.50 11,425.50 2.33% 100,000 No acceptanc - o.com.cn)No.:2016-
Jijia Fine Co., controlling purchased baseboard etc. price ,2016-5-5
e 027,2016-028,2015-
Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Bank Website(www.cninf
the same Commodity Packing case, Marketing 2016-3-25
5 Package printed matter 2,819.62 2,819.62 0.57% 100,000 No acceptanc - o.com.cn)No.:2016-
controlling purchased etc. price ,2016-5-5
Printing Co., e 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
CHANGHO control under
Website(www.cninf
NG(HK)TRA the same Commodity Black and white Marketing Spot 2016-3-25
6 179.34 179.34 0.04% 100,000 No - o.com.cn)No.:2016-
DINGLIMIT controlling purchased material price exchange ,2016-5-5
027,2016-028,2015-
ED shareholder
030,2016-046
and ultimate
controller
Sichuan Other
Juchao
Changhong enterprise
Bank Website(www.cninf
Precision control under Commodity Printed board Marketing 2016-3-25
7 471.03 471.03 0.10% 100,000 No acceptanc - o.com.cn)No.:2016-
Electronics the same purchased components etc. price ,2016-5-5
e 027,2016-028,2015-
Tech. Co., controlling
030,2016-046
Ltd. shareholder
42
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Commodity Power supply, Marketing Spot 2016-3-25
8 New Energy 16.18 16.18 0.00% 100,000 No - o.com.cn)No.:2016-
controlling purchased battery price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
081 control under
Website(www.cninf
Electronic the same Commodity Marketing Spot 2016-3-25
9 Transformer etc. 165.29 165.29 0.03% 15,000 No - o.com.cn)No.:2016-
Group Co., controlling purchased price exchange ,2016-5-5
027,2016-028,2015-
Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Spot Juchao
Mianyang control under
exchange, Website(www.cninf
Hongrun the same Commodity Marketing 2016-3-25
10 Power cord 583.74 583.74 0.12% 100,000 No Bank - o.com.cn)No.:2016-
Electronic controlling purchased price ,2016-5-5
acceptanc 027,2016-028,2015-
Co., Ltd. shareholder
e 030,2016-046
and ultimate
controller
Guangdong Other Juchao
Changhong enterprise Commodity Foam pieces Marketing Spot 2016-3-25 Website(www.cninf
11 561.62 561.62 0.11% 100,000 No -
Electronics control under purchased etc. price exchange ,2016-5-5 o.com.cn)No.:2016-
Co., Ltd. the same 027,2016-028,2015-
43
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controlling 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Hongyu Bank Website(www.cninf
the same Commodity Marketing 2016-3-25
12 Metal Radiator 6.97 6.97 0.00% 100,000 No acceptanc - o.com.cn)No.:2016-
controlling purchased price ,2016-5-5
Manufacture e 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Mianyang control under
Website(www.cninf
Hongfa the same Commodity Marketing Spot 2016-3-25
13 Hand piece etc. 46.93 46.93 0.01% 100,000 No - o.com.cn)No.:2016-
Technology controlling purchased price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Printed board, Bank Website(www.cninf
the same Commodity Marketing 2016-3-25
14 Devices remote control 2,578.26 2,578.26 0.52% 100,000 No acceptanc - o.com.cn)No.:2016-
controlling purchased price ,2016-5-5
Technology and transformer e 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Sichuan Other Commodity Sheet metal Marketing Spot 2016-3-25 Juchao
15 2,874.03 2,874.03 0.59% 15,000 No -
Changhong enterprise purchased parts, plastic price exchange, ,2016-5-5 Website(www.cninf
44
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Xinrui control under parts etc. Bank o.com.cn)No.:2016-
Technology the same acceptanc 027,2016-028,2015-
Co., Ltd controlling e 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Website(www.cninf
Hongwei the same Commodity DC power Marketing Spot 2016-3-25
16 4.92 4.92 0.00% 100,000 No - o.com.cn)No.:2016-
Technology controlling purchased supply etc. price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Commodity Light lamp, Marketing Spot 2016-3-25
17 Lighting 0.57 0.57 0.00% 100,000 No - o.com.cn)No.:2016-
controlling purchased lamp tube etc. price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co.,Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Advertising Website(www.cninf
Jiahong the same Commodity Marketing Spot 2016-3-25
18 materials, plant 2.91 2.91 0.00% 15,000 No - o.com.cn)No.:2016-
Industrial controlling purchased price exchange ,2016-5-5
etc. 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
45
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Other
enterprise
Sichuan Juchao
control under
Zhiyijia Website(www.cninf
the same Commodity Electronic Marketing Spot 2016-3-25
19 Network 1.32 1.32 0.00% 100,000 No - o.com.cn)No.:2016-
controlling purchased products price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Website(www.cninf
Changhong the same Commodity Marketing Spot 2016-3-25
20 Auxiliary parts 3.68 3.68 0.00% 100,000 No - o.com.cn)No.:2016-
Power Source controlling purchased price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Spot Juchao
Sichuan Controlling Information
Receiving exchange, Website(www.cninf
Changhong shareholder system services, Marketing 2016-3-25
21 labor 1,224.79 1,224.79 1.45% 5,000 No Bank - o.com.cn)No.:2016-
Electric Co., and ultimate marketing fee, price ,2016-5-5
services acceptanc 027,2016-028,2015-
LTD controller repair fee
e 030,2016-046
Other
enterprise
Sichuan Spot Juchao
control under
Changhong Receiving Transportation, exchange, Website(www.cninf
the same Marketing 2016-3-25
22 Minsheng labor storage, loading 17,928.41 17,928.41 21.23% 65,000 No Bank - o.com.cn)No.:2016-
controlling price ,2016-5-5
Logistic Co., services and unloading acceptanc 027,2016-028,2015-
shareholder
Ltd. e 030,2016-046
and ultimate
controller
46
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Other
enterprise
Sichuan Spot Juchao
control under
Service Exp. Receiving After-sales exchange, Website(www.cninf
the same Marketing 2016-3-25
23 Appliance labor maintenance fee 5,473.56 5,473.56 6.48% 20,000 No Bank - o.com.cn)No.:2016-
controlling price ,2016-5-5
Service Chain services etc. acceptanc 027,2016-028,2015-
shareholder
Co., Ltd. e 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Receiving Website(www.cninf
Hongxin the same Software usage Marketing Spot 2016-3-25
24 labor 3.77 3.77 0.00% 5,000 No - o.com.cn)No.:2016-
Software Co., controlling fee price exchange ,2016-5-5
services 027,2016-028,2015-
Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Guangdong control under
Receiving 2016-3-25 Website(www.cninf
Changhong the same Security service Marketing Spot
25 labor 29.81 29.81 0.04% 5,000 No - , o.com.cn)No.:2016-
Electronics controlling charge price exchange
services 2016-5-5 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
Juchao
Sichuan enterprise
Receiving Maintenance Website(www.cninf
Jiahong control under Marketing Spot 2016-3-25
26 labor fee, business 14.82 14.82 0.02% 15,000 No - o.com.cn)No.:2016-
Industrial the same price exchange ,2016-5-5
services activity fee 027,2016-028,2015-
Co., Ltd. controlling
030,2016-046
shareholder
47
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Receiving Website(www.cninf
the same Business Marketing Spot 2016-3-25
27 International labor 8.19 8.19 0.01% 15,000 No - o.com.cn)No.:2016-
controlling activity fee price exchange ,2016-5-5
Hotel Co., services 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Juchao
CHANGHO control under
Receiving Website(www.cninf
NG(HK)TRA the same Sales Marketing Spot 2016-3-25
28 labor 9.75 9.75 0.01% 5,000 No - o.com.cn)No.:2016-
DINGLIMIT controlling commission price exchange ,2016-5-5
services 027,2016-028,2015-
ED shareholder
030,2016-046
and ultimate
controller
Sichuan Juchao
Controlling
Changhong Receiving Website(www.cninf
shareholder Staff physical Marketing Spot 2016-3-25
29 Electronics labor 0.92 0.92 0.00% 15,000 No - o.com.cn)No.:2016-
and ultimate examination price exchange ,2016-5-5
Group Co., services 027,2016-028,2015-
controller
Ltd. 030,2016-046
Juchao
Sichuan Controlling
Accepting Water, Website(www.cninf
Changhong shareholder Marketing Spot 2016-3-25
30 fuel and electricity and 604.55 604.55 0.12% 100,000 No - o.com.cn)No.:2016-
Electric Co., and ultimate price exchange ,2016-5-5
power gas fee 027,2016-028,2015-
LTD controller
030,2016-046
Huayi Other Accepting Compressed air Marketing Spot 2016-3-25 Juchao
31 26.21 26.21 0.01% 100 No -
Compressor enterprise fuel and fees price exchange , Website(www.cninf
48
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Co., Ltd. control under power 2016-5-5 o.com.cn)No.:2016-
the same 027,2016-028,2015-
controlling 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Juchao
Guangdong control under Water and
Accepting Website(www.cninf
Changhong the same electricity fee Marketing Spot 2016-3-25
32 fuel and 57.10 57.10 0.01% 100,000 No - o.com.cn)No.:2016-
Electronics controlling and Compressed price exchange ,2016-5-5
power 027,2016-028,2015-
Co., Ltd. shareholder air fees
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Accepting Website(www.cninf
Jiahong the same Water and Marketing Spot 2016-3-25
33 fuel and 0.71 0.71 0.00% 15,000 No - o.com.cn)No.:2016-
Industrial controlling electricity fee price exchange ,2016-5-5
power 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Sichuan Juchao
Controlling
Changhong Accepting Bank Website(www.cninf
shareholder Water and Marketing 2016-3-25
34 Electronics fuel and 1.02 1.02 0.00% 15,000 No acceptanc - o.com.cn)No.:2016-
and ultimate electricity fee price ,2016-5-5
Group Co., power e 027,2016-028,2015-
controller
Ltd. 030,2016-046
Sichuan Controlling Air Spot Juchao
Sales of Marketing 2016-3-25
35 Changhong shareholder conditioning, 53,934.25 53,934.25 7.85% 350,000 No exchange, - Website(www.cninf
goods price ,2016-5-5
Electric Co., and ultimate small household Bank o.com.cn)No.:2016-
49
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
LTD controller electrical acceptanc 027,2016-028,2015-
appliances e 030,2016-046
Sichuan Juchao
Controlling
Changhong Website(www.cninf
shareholder Sales of Marketing Spot 2016-3-25
36 Electronics Food 148.47 148.47 0.02% 10,000 No - o.com.cn)No.:2016-
and ultimate goods price exchange ,2016-5-5
Group Co., 027,2016-028,2015-
controller
Ltd. 030,2016-046
Other
enterprise
Juchao
Sichuan control under
Bank Website(www.cninf
Changhong the same Sales of Color board, Marketing 2016-3-25
37 2,269.56 2,269.56 0.33% 350,000 No acceptanc - o.com.cn)No.:2016-
Jijia Fine Co., controlling goods power line price ,2016-5-5
e 027,2016-028,2015-
Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Spot Juchao
control under Plastic particles,
Changhong exchange, Website(www.cninf
the same Sales of components and Marketing 2016-3-25
38 Mold Plastic 8,989.13 8,989.13 1.31% 350,000 No Bank - o.com.cn)No.:2016-
controlling goods air conditioning price ,2016-5-5
Tech. Co., acceptanc 027,2016-028,2015-
shareholder etc.
Ltd. e 030,2016-046
and ultimate
controller
Other
enterprise Spot Juchao
Lejiayi Chain control under Refrigerator, exchange, Website(www.cninf
Sales of Marketing 2016-3-25
39 Management the same washing 176.06 176.06 0.03% 350,000 No Bank - o.com.cn)No.:2016-
goods price ,2016-5-5
Co., Ltd. controlling machine acceptanc 027,2016-028,2015-
shareholder e 030,2016-046
and ultimate
50
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controller
Other
enterprise
Juchao
CHANGHO control under
Refrigerator Website(www.cninf
NG(HK)TRA the same Sales of Marketing Spot 2016-3-25
40 (cabinet), air 36,112.72 36,112.72 5.26% 350,000 No - o.com.cn)No.:2016-
DINGLIMIT controlling goods price exchange ,2016-5-5
conditioner 027,2016-028,2015-
ED shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
CHANGHO control under
Website(www.cninf
NGELECTRI the same Sales of Marketing Spot 2016-3-25
41 Refrigerator 10.66 10.66 0.00% 350,000 No - o.com.cn)No.:2016-
C(AUSTRAL controlling goods price exchange ,2016-5-5
027,2016-028,2015-
IA) shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Bank Website(www.cninf
the same Sales of Capacitance, Marketing 2016-3-25
42 Xinrui 75.89 75.89 0.01% 10,000 No acceptanc - o.com.cn)No.:2016-
controlling goods resistance etc. price ,2016-5-5
Technology e 027,2016-028,2015-
shareholder
Co., Ltd 030,2016-046
and ultimate
controller
Sichuan Other Juchao
Hongwei enterprise Sales of Marketing Spot 2016-3-25 Website(www.cninf
43 Food 0.61 0.61 0.00% 350,000 No -
Technology control under goods price exchange ,2016-5-5 o.com.cn)No.:2016-
Co., Ltd. the same 027,2016-028,2015-
51
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controlling 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Sales of Marketing Spot 2016-3-25
44 Devices Food 0.17 0.17 0.00% 350,000 No - o.com.cn)No.:2016-
controlling goods price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Sales of Marketing Spot 2016-3-25
45 Minsheng Air-conditioner 58.93 58.93 0.01% 350,000 No - o.com.cn)No.:2016-
controlling goods price exchange ,2016-5-5
Logistic Co., 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Service Exp. Website(www.cninf
the same Sales of Air-conditioner Marketing Spot 2016-3-25
46 Appliance 285.23 285.23 0.04% 350,000 No - o.com.cn)No.:2016-
controlling goods and Repair parts price exchange ,2016-5-5
Service Chain 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Sichuan Other Sales of Marketing Spot 2016-3-25 Juchao
47 Waste material 364.88 364.88 0.05% 350,000 No -
Changhong enterprise goods price exchange ,2016-5-5 Website(www.cninf
52
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Gerun control under o.com.cn)No.:2016-
Renewable the same 027,2016-028,2015-
Resources controlling 030,2016-046
Co., Ltd. shareholder
and ultimate
controller
Other
enterprise
Juchao
Hefei control under
Bank Website(www.cninf
Changhong the same Sales of Marketing 2016-3-25
48 Packing box 104.71 104.71 0.02% 350,000 No acceptanc - o.com.cn)No.:2016-
Industrial controlling goods price ,2016-5-5
e 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
control under
Sichuan Website(www.cninf
the same Sales of Marketing Spot 2016-3-25
49 Huafeng Air-conditioner 15.58 15.58 0.00% 10,000 No - o.com.cn)No.:2016-
controlling goods price exchange ,2016-5-5
Corp. Group 027,2016-028,2015-
shareholder
030,2016-046
and ultimate
controller
Other
enterprise Refrigerator
Sichuan Juchao
control under (cabinet), air Bank,
Zhiyijia Website(www.cninf
the same Sales of conditioning, Marketing business 2016-3-25
50 Network 66,360.65 66,360.65 9.66% 350,000 No - o.com.cn)No.:2016-
controlling goods small household price acceptanc ,2016-5-5
Technology 027,2016-028,2015-
shareholder electrical e
Co., Ltd. 030,2016-046
and ultimate appliances
controller
53
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Other
enterprise
Juchao
Sichuan control under
Website(www.cninf
Changhong the same Sales of Marketing Spot 2016-3-25
51 Food 3.70 3.70 0.00% 350,000 No - o.com.cn)No.:2016-
Property Co., controlling goods price exchange ,2016-5-5
027,2016-028,2015-
Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Spot Juchao
control under Small
Anhui exchange, Website(www.cninf
the same Sales of household Marketing 2016-3-25
52 Xinhao PDP 5.13 5.13 0.00% 10,000 No Bank - o.com.cn)No.:2016-
controlling goods electrical price ,2016-5-5
Co., Ltd. acceptanc 027,2016-028,2015-
shareholder appliances
e 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Sales of Marketing Spot 2016-3-25
53 Network Food 0.61 0.61 0.00% 350,000 No - o.com.cn)No.:2016-
controlling goods price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Chengdu Other
Juchao
Changhong enterprise
Website(www.cninf
Electronic control under Sales of Marketing Spot 2016-3-25
54 Air-conditioner 1.55 1.55 0.00% 350,000 No - o.com.cn)No.:2016-
Science and the same goods price exchange ,2016-5-5
027,2016-028,2015-
Technology controlling
030,2016-046
Co., Ltd. shareholder
54
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
and ultimate
controller
Other
Sichuan
enterprise
Changhong Juchao
control under
Wisdom Website(www.cninf
the same Sales of Marketing Spot 2016-3-25
55 Health Food 0.30 0.30 0.00% 350,000 No - o.com.cn)No.:2016-
controlling goods price exchange ,2016-5-5
Science and 027,2016-028,2015-
shareholder
Technology 030,2016-046
and ultimate
Co., Ltd.
controller
Other
enterprise
Juchao
Mianyang control under
Website(www.cninf
Hongfa the same Sales of Marketing Spot 2016-3-25
56 Food 0.23 0.23 0.00% 350,000 No - o.com.cn)No.:2016-
Technology controlling goods price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Guangdong control under
Website(www.cninf
Changhong the same Sales of Kitchen and Marketing Spot 2016-3-25
57 0.14 0.14 0.00% 350,000 No - o.com.cn)No.:2016-
Electronics controlling goods toilet price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Sichuan Other Juchao
Huanyu enterprise Sales of Marketing Spot 2016-3-25 Website(www.cninf
58 Food 0.42 0.42 0.00% 10,000 No -
Industrial Co. control under goods price exchange ,2016-5-5 o.com.cn)No.:2016-
Ltd. the same 027,2016-028,2015-
55
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controlling 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Juchao
Guangdong control under
Providing Website(www.cninf
Changhong the same Water and Marketing Spot 2016-3-25
59 fuel and 29.28 29.28 0.00% 350,000 No - o.com.cn)No.:2016-
Electronics controlling electricity fee price exchange ,2016-5-5
power 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Providing Website(www.cninf
the same Water and Marketing Spot 2016-3-25
60 Minsheng fuel and 2.02 2.02 0.00% 350,000 No - o.com.cn)No.:2016-
controlling electricity fee price exchange ,2016-5-5
Logistic Co., power 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Guangdong Juchao
control under
Changhong Providing Website(www.cninf
the same Water and Marketing Spot 2016-3-25
61 Diveces fuel and 13.66 13.66 0.00% 350,000 No - o.com.cn)No.:2016-
controlling electricity fee price exchange ,2016-5-5
Technology power 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Sichuan Other Providing Water and Marketing Spot 2016-3-25 Juchao
62 6.53 6.53 0.00% 350,000 No -
Changhong enterprise fuel and electricity fee price exchange ,2016-5-5 Website(www.cninf
56
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Jijia Fine Co., control under power o.com.cn)No.:2016-
Ltd. the same 027,2016-028,2015-
controlling 030,2016-046
shareholder
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Providing Website(www.cninf
the same Water and Marketing Spot 2016-3-25
63 Mold Plastic fuel and 301.01 301.01 0.04% 350,000 No - o.com.cn)No.:2016-
controlling electricity fee price exchange ,2016-5-5
Tech. Co., power 027,2016-028,2015-
shareholder
Ltd. 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Spot Juchao
control under
Changhong exchange, Website(www.cninf
the same Rent to the Warehouse Marketing 2016-3-25
64 Mold Plastic 30.84 30.84 0.40% 3,000 No Bank - o.com.cn)No.:2016-
controlling related party lease, workshop price ,2016-5-5
Tech. Co., acceptanc 027,2016-028,2015-
shareholder
Ltd. e 030,2016-046
and ultimate
controller
Other
enterprise
Sichuan Spot Juchao
control under
Changhong exchange, Website(www.cninf
the same Rent to the Forklift, Marketing 2016-3-25
65 Xinrui 1.26 1.26 0.02% 10,000 No Bank - o.com.cn)No.:2016-
controlling related party warehouse lease price ,2016-5-5
Technology acceptanc 027,2016-028,2015-
shareholder
Co., Ltd e 030,2016-046
and ultimate
controller
57
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Other
enterprise
Juchao
BVCH control under
Website(www.cninf
Optronics the same Rent to the Freight elevator Marketing Spot 2016-3-25
66 6.37 6.37 0.08% 3,000 No - o.com.cn)No.:2016-
(Sichuan) controlling related party rental price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under Warehouse
Bank Website(www.cninf
Changhong the same Rent to the lease, forklift, Marketing 2016-3-25
67 1.84 1.84 0.02% 3,000 No acceptanc - o.com.cn)No.:2016-
Jijia Fine Co., controlling related party two living price ,2016-5-5
e 027,2016-028,2015-
Ltd. shareholder quarters lease
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Guangdong control under
Website(www.cninf
Changhong the same Rent to the Part of office Marketing Spot 2016-3-25
68 40.23 40.23 0.52% 3,000 No - o.com.cn)No.:2016-
Electronics controlling related party building for rent price exchange ,2016-5-5
027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Other
Sichuan Warehouse Juchao
enterprise
Changhong lease, Website(www.cninf
control under Rent to the Marketing Spot 2016-3-25
69 Minsheng workshop,Part 63.55 63.55 0.83% 3,000 No - o.com.cn)No.:2016-
the same related party price exchange ,2016-5-5
Logistic Co., of office 027,2016-028,2015-
controlling
Ltd. building for rent 030,2016-046
shareholder
58
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
and ultimate
controller
Other
enterprise
Sichuan Juchao
control under
Changhong Website(www.cninf
the same Rent to the Marketing Spot 2016-3-25
70 Devices Workshop 41.86 41.86 0.54% 3,000 No - o.com.cn)No.:2016-
controlling related party price exchange ,2016-5-5
Technology 027,2016-028,2015-
shareholder
Co., Ltd. 030,2016-046
and ultimate
controller
Juchao
Sichuan Controlling
Rent from Website(www.cninf
Changhong shareholder Workshop, Marketing Spot 2016-3-25
71 the related 260.68 260.68 3.37% 3,000 No - o.com.cn)No.:2016-
Electric Co., and ultimate office lease price exchange ,2016-5-5
party 027,2016-028,2015-
LTD controller
030,2016-046
Sichuan Juchao
Controlling
Changhong Rent from Website(www.cninf
shareholder Shops, staff Marketing Spot 2016-3-25
72 Electronics the related 5.40 5.40 0.07% 15,000 No - o.com.cn)No.:2016-
and ultimate quarters price exchange ,2016-5-5
Group Co., party 027,2016-028,2015-
controller
Ltd. 030,2016-046
Other
enterprise
Juchao
Beijing control under
Rent from Website(www.cninf
Changhong the same Marketing Spot 2016-3-25
73 the related Office rental 8.91 8.91 0.12% 3,000 No - o.com.cn)No.:2016-
Technology controlling price exchange ,2016-5-5
party 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Guangdong Other Rent from Marketing Spot 2016-3-25 Juchao
74 Staff dormitory 27.95 27.95 0.36% 3,000 No -
Changhong enterprise the related price exchange ,2016-5-5 Website(www.cninf
59
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Electronics control under party o.com.cn)No.:2016-
Co., Ltd. the same 027,2016-028,2015-
controlling 030,2016-046
shareholder
and ultimate
controller
Video Juchao
Sichuan Controlling
conference Bank Website(www.cninf
Changhong shareholder Purchase of Marketing 2016-3-25
75 system and 21.62 21.62 0.32% 5,000 No acceptanc - o.com.cn)No.:2016-
Electric Co., and ultimate fixed assets price ,2016-5-5
related e 027,2016-028,2015-
LTD controller
equipment 030,2016-046
Other
enterprise
Juchao
Sichuan control under Purchase of Software Bank
Website(www.cninf
Hongxin the same fixed assets, development Marketing acceptanc 2016-3-25
76 33.80 33.80 0.76% 5,000 No - o.com.cn)No.:2016-
Software Co., controlling intangible and information price e、Spot ,2016-5-5
027,2016-028,2015-
Ltd. shareholder assets system exchange
030,2016-046
and ultimate
controller
Other
enterprise
Juchao
Sichuan control under
Laboratory Website(www.cninf
Hongwei the same Purchase of Marketing Spot 2016-3-25
77 apparatus and 111.03 111.03 1.63% 5,000 No - o.com.cn)No.:2016-
Technology controlling fixed assets price exchange ,2016-5-5
other equipment 027,2016-028,2015-
Co., Ltd. shareholder
030,2016-046
and ultimate
controller
Sichuan Other Juchao
Sales of Disposal of Marketing Spot 2016-3-25
78 Changhong enterprise 3.11 3.11 0.64% 5,000 No - Website(www.cninf
fixed assets waste assets price exchange ,2016-5-5
Gerun control under o.com.cn)No.:2016-
60
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Renewable the same 027,2016-028,2015-
Resources controlling 030,2016-046
Co., Ltd. shareholder
and ultimate
controller
Total -- - 273,351.93 - - - -- -- -- --
Detail of sales return with major amount involved -
1. It is estimated that the related transaction amount resulted by purchasing goods (including door shell and plastic products etc.) and accepting fuel
and power from Sichuan Changhong and its subsidiary by the Company for year of 2016 was RMB 1000 million at most (tax-excluded), actually
RMB 520.5869 million occurred in reporting period (tax-excluded).
2. It is estimated that the related transaction amount resulted by purchasing goods (including compressor purchased etc.) from Huayi Compressor
and its subsidiary by the Company for year of 2016 was RMB 700 million at most (tax-excluded), actually RMB 235.9852 million occurred in
reporting period (tax-excluded).
3. It is estimated that the related transaction amount resulted by purchasing or selling equipment, software, maintenance and spare parts and molds
etc. from Sichuan Changhong and its subsidiary by the Company for year of 2016 was RMB 50 million at most (tax-excluded), actually RMB
1.6956 million occurred in reporting period (tax-excluded).
4. It is estimated that the related transaction amount resulted by purchasing goods from and providing fuel and power to Sichuan Changhong and its
Report the actual implementation of the daily related transactions which subsidiary by the Company for year of 2016 was RMB 3500 million at most (tax-excluded), actually RMB 1690.2659 million occurred in reporting
were projected about their total amount by types during the reporting period (tax-excluded).
period(if applicable) 5. It is estimated that the related transaction amount resulted by receiving energy, power and service etc. from Huayi Compressor and its subsidiary
by the Company for year of 2016 was RMB 1 million at most (tax-excluded), actually RMB 262,100 occurred in reporting period (tax-excluded).
6. It is estimated that the related transaction amount resulted by leasing business from Sichuan Changhong and its subsidiary by the Company for
year of 2016 was RMB 30 million at most (tax-excluded), actually RMB 4.8223 million occurred in reporting period (tax-excluded).
7. It is estimated that the related transaction amount from domestic finished goods logistic business outsourcing and purchase of compressors to
Sichuan Changhong Minsheng Logistic Co., Ltd. by the Company for year of 2016 was RMB 650 million at most (tax-excluded), actually RMB
179.2841 million occurred in reporting period (tax-excluded).
8. It is estimated that the related transaction amount from after sales service of domestic goods outsourcing to Sichuan Service Exp. Appliance
Service Chain Co., Ltd. by the Company for year of 2016 was RMB 200 million at most (tax-excluded), actually RMB 54.7356 million occurred in
reporting period (tax-excluded).
9. It is estimated that the related transaction amount resulted by accepting other service and labor service etc. or providing other service and labor
61
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
service etc. to Sichuan Changhong and its subsidiary by the Company for year of 2016 was RMB 50 million at most (tax-excluded), actually RMB
12.6812 million occurred in reporting period (tax-excluded).
10. It is estimated that the related transaction amount resulted by selling goods and renting from Sichuan Changhong Electronics Group and its
subsidiary by the Company for year of 2016 was RMB 100 million at most (tax-excluded), actually RMB 2.4675 million occurred in reporting
period.
11. It is estimated that the related transaction amount resulted by purchasing goods and receiving labor services, fuel power, leasing and purchasing
equipment etc. from Sichuan Changhong Electronics Group and its subsidiary by the Company for year of 2016 was RMB 150 million at most
(tax-excluded), actually RMB 30.7329 million occurred in reporting period.
Reasons for major differences between trading price and
Not applicable
market reference price
62
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(2) Related transactions with Finance Company
① Related transactions about the ―Financial Service Agreement‖ signed between the Company
and Sichuan Changhong Group Finance Co., Ltd.
In order to expand the financing channels and reduce financing costs and financial costs,
combining the good cooperation over the past three years, the company held the eighteenth meeting
of the eighth board of directors on March 18, 2016 and the first extraordinary general meeting of
2016 on April 6, 2016 which deliberated and agreed the company and Sichuan Changhong Group
Finance Co., Ltd. (hereinafter referred to as "Changhong Finance Company") to carry on financial
services cooperation and sign a triennial "financial service agreement". Under the agreement,
Changhong Finance Company would provide a series of financial services within the business
scope in accordance with the requirements of the Company and its subsidiaries, including but not
limited to deposit services, settlement services, loan services, bills discounting services, guarantees
and other services approved by China Banking Regulatory Commission that a finance company can
engage in.
According to the provisions of "Information Disclosure Memorandum No. 2 – transactions and
related transactions" of Shenzhen Stock Exchange, the company carries out the loans and deposits
and other related services according to the "Financial Services Agreement" signed with Changhong
Finance Company, and continues to complete the risk management of loans and deposits services
with Changhong Finance Company, regularly makes special risk assessments and issues risk
assessment reports, and implements the obligation of information disclosure in accordance with
relevant regulations. On March 19, April 7, & July 29, 2016, the company has disclosed the detailed
information on the appointed information disclosure media, including "Securities Times", "China
Securities Journal", "Hong Kong Commercial Daily" and www.cninfo.com.cn in the form of
announcement (No. 2016-020, No. 2016-021, No. 2016-022, No. 2016-037), "Risk continuous
assessment report about Sichuan Changhong Group Finance Co., Ltd.", and on the company’s 2015
annual report, the first quarter report of 2016, and the semi-annual report of 2016.
② Related transactions between the Company and Changhong Finance Company
Up to 30 June 2016, the Company has opened financial business as savings, note drawing and
notes discounted with Changhong Finance Company. The Company and its subordinate company
owns 1,961,248,737.41 Yuan savings in Changhong Finance Company, takes 28.88% of the deposit
taking balance in Changhong Finance Company without 30% occupied, balance of notes drawing
was 947,327,855.67 Yuan and balance of notes discounted as 357,329,539.67 Yuan. Changhong
63
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Finance Company offering the ceiling credit (including loans and guarantee ect.) of 2,030 million
Yuan to the Company and subordinate subsidiaries, the Company and its subsidiaries has 0 Yuan
loans in Changhong Finance Company. More details are:
In RMB
Interest and
commission
Balance at Increase in the Decrease in the Balance at
Name charge
year-begin year year year-end
received or
paid
I. Savings in Changhong
1,260,081,706.55 8,817,756,809.74 8,116,589,778.88 1,961,248,737.41 9,011,493.56
Group Finance Company
II. Borrowings from
Changhong Group - - - - -
Finance Company
1.Short-term loans - - - - -
2.Long-term loans - - - - -
III. Other financial
- - - - -
business
1.notes drawing 733,001,248.18 1,005,335,926.96 791,009,319.47 947,327,855.67 -
2.notes discounted 236,410,328.55 543,065,633.55 422,146,422.43 357,329,539.67 6,620,397.78
Note: The Company purchases Guangdong Changhong Ridian Technology Co., Ltd. (―Changhong RIdian‖)
in early of 2016, the above table including the financial business of savings and notes arising from related
transactions between Changhong Ridian and Changhong Finance Company
2. Related transactions by assets acquisition and sold
√ Applicable □Not applicable
64
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Book value Assessed
Transaction
Type of valuation value of Market fair Transfer
Clearing gains and
of Content of transferred transferred assets value (in 10 price (in 10
Relationsh Pricing form for
Related party related related losses (in 10 Date of disclosure Index of disclosure
ip principle assets (in 10 (in 10 thousand thousand Yuan) thousand related
transa transaction
transaction thousand
ction thousand Yuan) (if (if applicable) Yuan)
Yuan)
Yuan) applicable)
The
Sichuan Juchao Website
controlling 98.856%
Changhong (www.cninfo.com.cn)
shareholde equity of
Electric Co., LTD, 2015-12-19,
r of the Equity Guangdong Marketizat No.: 2015-061,
Not 2015-12-24,
Sichuan
company purcha Changhong ion 9,088.65 9,674.61 9,565 9,565 Spot No.: 2015-062,
Changhong applicable 2016-1-5,
and its se Ridian principle No.: 2015-066,
Innovation 2016-2-4
subordinat Technology No.: 2015-067,
Investment Co.,
e Co., Ltd.
Ltd. No.: 2016-001
subsidiary
Reasons for major differences between transfer price
and book value or assessed valuation value (if
Not applicable
applicable)
In line with the strategy development plan, and in purpose of improving the household appliances industry line and product line of the Company,
and fully playing the cooperativity of the business, enhancing comprehensive competive-ness, the Company takes small appliances as one of the
important development direction in the industry.
The impact on the Company's operating results and The Company acquiring relevant equity of Changhong Ridian which is hold by Sichuan Changhong through bidding, after trading, it benefits the
financial situation further integration and optimizing household appliances resources, which is up to the mustard of strategy development of the
Company. After integration, the Company enter the small appliance industry, improve household appliance production lines through
industry integration of ―white household appliances + small appliances‖, benefit a lot in playing the synergistic effect in the
industry, enhancing the comprehensive competitive capacity in the household appliances field
65
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
3. Material related transaction of jointly foreign investment
□ Applicable √ Not applicable
The Company has no material related transaction of jointly foreign investment occurred in
reporting period.
4. Connect of related liability and debt
√ Applicable □Not applicable
Whether has non-operational contact of related liability and debts or not
□ Yes √No
No non-operational contact of related liability or debts in Period
66
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(1) Claim receivable from related party:
Balance at Current Balance at
Whether has Current Current
period-begi interest period-end
non-business newly added recovery Intere
Serial Related party Relationship Causes n (10 (10 (10
capital (10 thousand (10 thousand st rate
thousand thousand thousand
occupying or not Yuan) Yuan)
Yuan) Yuan) Yuan)
Operational
Sichuan Changhong Controlling shareholder and
1 contact of No 258.76 53,934.25 52,829.39 - - 1,363.63
Electric Co., LTD ultimate controller
related credit
Sichuan Changhong Operational
Controlling shareholder and
2 Electronics Group contact of No 220.92 169.52 - - - 390.43
ultimate controller
Co., Ltd. related credit
Other enterprise control
Operational
CHANGHONG(HK) under the same controlling
3 contact of No 13,321.47 36,112.72 26,176.11 - - 23,258.07
TRADINGLIMITED shareholder and ultimate
related credit
controller
Other enterprise control
PT.CHANGHONGE Operational
under the same controlling
4 LECTRICINDONES contact of No 21.24 - 21.24 - - -
shareholder and ultimate
IA related credit
controller
Other enterprise control
CHANGHONGELE Operational
under the same controlling
5 CTRIC(AUSTRALI contact of No - 11.15 0.00 - - 11.14
shareholder and ultimate
A) related credit
controller
Chengdu Changhong Other enterprise control
Operational
Electronic Science under the same controlling
6 contact of No 183.52 1.55 36.94 - - 148.14
and Technology Co., shareholder and ultimate
related credit
Ltd. controller
7 Sichuan Changhong Other enterprise control Operational No 8.03 124.50 106.00 - - 26.53
67
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Minsheng Logistic under the same controlling contact of
Co., Ltd. shareholder and ultimate related credit
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
8 Power Source Co., contact of No - 1.82 - - - 1.82
shareholder and ultimate
Ltd. related credit
controller
Other enterprise control
Operational
Hefei Changhong under the same controlling
9 contact of No 149.21 104.71 199.67 - - 54.25
Industrial Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Operational
Huayi Compressor under the same controlling
10 contact of No 26.38 931.40 0.00 - - 957.78
Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Operational
Mianyang Hongfa under the same controlling
11 contact of No - 0.23 0.23 - - -
Technology Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Sichuan Service Exp. Operational
under the same controlling
12 Appliance Service contact of No 20.00 285.23 285.23 - - 20.00
shareholder and ultimate
Chain Co., Ltd. related credit
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
13 Devices Technology contact of No 0.14 55.69 55.63 - - 0.20
shareholder and ultimate
Co., Ltd. related credit
controller
Sichuan Changhong Other enterprise control Operational
14 Gerun Renewable under the same controlling contact of No 0.36 367.99 367.99 - - 0.36
Resources Co., Ltd. shareholder and ultimate related credit
68
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
15 International Hotel contact of No 285.98 - 61.88 - - 224.09
shareholder and ultimate
Co., Ltd. related credit
controller
Other enterprise control
Operational
Sichuan Changhong under the same controlling
16 contact of No 0.55 2,277.93 2,278.48 - - -
Jijia Fine Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
17 Mold Plastic Tech. contact of No 20.75 9,320.99 9,286.99 - - 54.74
shareholder and ultimate
Co., Ltd. related credit
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
18 Xinrui Technology contact of No - 77.15 77.15 - - -
shareholder and ultimate
Co., Ltd related credit
controller
Other enterprise control
Operational
Yibing Hongxing under the same controlling
19 contact of No 105.80 - - - - 105.80
Electronics Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Lejiayi Chain Operational
under the same controlling
20 Management Co., contact of No 32.58 176.06 143.39 - - 65.25
shareholder and ultimate
Ltd. related credit
controller
Other enterprise control
Guangdong Operational
under the same controlling
21 Changhong contact of No - 69.65 69.65 - - -
shareholder and ultimate
Electronics Co., Ltd. related credit
controller
22 Sichuan Changhong Other enterprise control Operational No 0.08 - 0.08 - - -
69
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Package Printing Co., under the same controlling contact of
Ltd. shareholder and ultimate related credit
controller
Other enterprise control
Operational
Sichuan Hongwei under the same controlling
23 contact of No 0.90 0.61 1.51 - - -
Technology Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Sichuan Zhiyijia Operational
under the same controlling
24 Network Technology contact of No 26,096.46 66,360.65 81,374.57 - - 11,082.55
shareholder and ultimate
Co., Ltd. related credit
controller
Other enterprise control
Sichuan Changhong Operational
under the same controlling
25 Network Technology contact of No 5.12 0.61 5.73 - - -
shareholder and ultimate
Co., Ltd. related credit
controller
Other enterprise control
Operational
Sichuan Changhong under the same controlling
26 contact of No - 4.03 0.00 - - 4.03
Property Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Operational
BVCH Optronics under the same controlling
27 contact of No - 6.37 6.37 - - -
(Sichuan) Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control
Operational
Anhui Xinhao PDP under the same controlling
28 contact of No 64.50 5.13 6.63 - - 63.00
Co., Ltd. shareholder and ultimate
related credit
controller
Other enterprise control Operational
Sichuan Huafeng
29 under the same controlling contact of No - 15.58 15.58 - - -
Corp. Group
shareholder and ultimate related credit
70
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controller
Sichuan Changhong Other enterprise control
Operational
Wisdom Health under the same controlling
30 contact of No - 0.30 0.30 - - -
Science and shareholder and ultimate
related credit
Technology Co., Ltd. controller
Other enterprise control
Operational
Sichuan Huanyu under the same controlling
31 contact of No - 0.42 0.42 - - -
Industrial Co. Ltd. shareholder and ultimate
related credit
controller
- - - - - 40,822.75 170,416.21 173,407.14 - - 37,831.82
(2) Debts payable to related party:
Current
Balance at Current Current Balance at
Inte interest
period-begin newly added recovery period-end (10
Serial Related party Relationship Causes rest (10
(10 thousand (10 thousand (10 thousand thousand
rate thousand
Yuan) Yuan) Yuan) Yuan)
Yuan)
Sichuan Changhong Electric Co., Controlling shareholder and Operational contact
1 3,639.39 9,727.24 11,792.77 - - 1,573.86
LTD ultimate controller of related debt
Sichuan Changhong Electronics Controlling shareholder and Operational contact
2 0.41 7.35 7.76 - - -
Group Co., Ltd. ultimate controller of related debt
Other enterprise control
CHANGHONG(HK)TRADINGLI under the same controlling Operational contact
3 87.66 189.09 217.82 - - 58.93
MITED shareholder and ultimate of related debt
controller
Other enterprise control
CHANGHONGELECTRICMIDDL under the same controlling Operational contact
4 0.16 0.01 0.00 - - 0.17
EEASTFZE shareholder and ultimate of related debt
controller
5 Guangdong Changhong Electronics Other enterprise control Operational contact 272.53 676.48 667.06 - - 281.96
71
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Co., Ltd. under the same controlling of related debt
shareholder and ultimate
controller
Other enterprise control
Guangdong Changhong Ridian under the same controlling Operational contact
6 151.60 - 151.60 - - -
Technology Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
under the same controlling Operational contact
7 Huayi Compressor Co., Ltd. 14,024.94 23,624.73 37,496.77 - - 152.90
shareholder and ultimate of related debt
controller
Other enterprise control
Lejiayi Chain Management Co., under the same controlling Operational contact
8 0.09 2.00 - - - 2.09
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
under the same controlling Operational contact
9 081 Electronic Group Co., Ltd. 14.85 165.29 85.24 - - 94.90
shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Zhiyijia Network under the same controlling Operational contact
10 4.87 935.30 - - - 940.17
Technology Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Mianyang Hongfa Technology Co., under the same controlling Operational contact
11 3.80 397.90 - - - 401.69
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Mianyang Hongrun Electronic Co., Operational contact
12 under the same controlling 43.88 583.74 176.38 - - 451.24
Ltd. of related debt
shareholder and ultimate
72
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controller
Other enterprise control
Sichuan CCO Display Device Co., under the same controlling Operational contact
13 7.46 - 7.46 - - -
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Hongwei Technology Co., under the same controlling Operational contact
14 - 135.65 -0.00 - - 135.65
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Hongyu Metal under the same controlling Operational contact
15 7.66 37.22 -0.00 - - 44.88
Manufacture Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Service Exp. Appliance under the same controlling Operational contact
16 1,235.06 5,473.56 5,268.47 - - 1,440.15
Service Chain Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Package under the same controlling Operational contact
17 386.57 2,819.62 132.68 - - 3,073.51
Printing Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Power Source under the same controlling Operational contact
18 1.77 3.68 5.45 - - -
Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Devices under the same controlling Operational contact
19 285.70 2,578.26 766.28 - - 2,097.68
Technology Co., Ltd. shareholder and ultimate of related debt
controller
20 Sichuan Changhong Gerun Other enterprise control Operational contact 36.01 3.56 -0.00 - - 39.57
73
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Renewable Resources Co., Ltd. under the same controlling of related debt
shareholder and ultimate
controller
Other enterprise control
Sichuan Changhong International under the same controlling Operational contact
21 - 8.19 8.19 - - -
Hotel Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Jijia Fine Co., under the same controlling Operational contact
22 1,854.53 11,425.50 4,112.56 - - 9,167.48
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Precision under the same controlling Operational contact
23 47.44 524.49 -0.00 - - 571.93
Electronics Tech. Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Minsheng under the same controlling Operational contact
24 1,437.86 17,928.41 15,832.34 - - 3,533.93
Logistic Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Mold Plastic under the same controlling Operational contact
25 4,798.18 24,724.79 15,944.24 - - 13,578.73
Tech. Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Xinrui under the same controlling Operational contact
26 1,809.92 2,874.03 2,180.09 - - 2,503.85
Technology Co., Ltd shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong New Energy Operational contact
27 under the same controlling 3.51 16.18 19.50 - - 0.19
Technology Co., Ltd. of related debt
shareholder and ultimate
74
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
controller
Other enterprise control
Sichuan Changhong Lighting under the same controlling Operational contact
28 2.85 0.57 3.41 - - -
Technology Co.,Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Beijing Changhong Technology under the same controlling Operational contact
29 - 8.91 8.91 - - -
Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Changhong Electronic under the same controlling Operational contact
30 7.70 - - - - 7.70
System Co., Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
under the same controlling Operational contact
31 Sichuan Jiahong Industrial Co., Ltd. 8.05 18.44 11.63 - - 14.86
shareholder and ultimate of related debt
controller
Other enterprise control
Sichuan Hongxin Software Co., under the same controlling Operational contact
32 - 37.57 37.57 - - -
Ltd. shareholder and ultimate of related debt
controller
Other enterprise control
under the same controlling Operational contact
33 Sichuan Huafeng Corp. Group - 23.49 0.00 - - 23.49
shareholder and ultimate of related debt
controller
Other enterprise control
PT.CHANGHONGELECTRICIND under the same controlling Operational contact
34 0.02 - 0.02 - - 0
ONESIA shareholder and ultimate of related debt
controller
- - - - 30,174.47 104,951.25 94,934.19 - - 40,191.50
75
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Note: Changhong Ridian was purchased by the Company in early 2016, the year-beginning balance listed in above table has been re-stated,
including the Changhong Ridian.
For the above-mentioned statement, up to the Period-end, debts payable to related party from the Company and subordinate are amounting
as 401.9150 million Yuan in total, the claim receivable from related party for the Company and subordinate amounting as 378.3182 million
Yuan.
76
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
5. Other related transactions
√ Applicable □Not applicable
Being pass a resolution on 17th session of the 8th BOD and first extraordinary general
meeting of 2016 held on 6 March 2016 and 6 April, the Company agreed to adjusted the offering
price and pricing principle, offering numbers and validity of the offering resolution for this
non-public offering.
In view of the adjsutment of offering price, pricing principle and offering numbers for this
non-public offering, the proposal of re-signing the ―subscription agreement of privately placement
with entry-into-force conditions‖ between the Company and Sichuan Changhong Electric Co., Ltd.
was deliberated and approved by the 17th session of 8th BOD and first extraordinary general
meeting of 2016. On 6 March 2016, the Company re-signing the ―subscription agreement of
privately placement with entry-into-force conditions‖ with Sichuan Changhong, which has the
same content with former Agreement, except the clasuse of ―Pricing Principle and Subscription
Price‖, and ―Execution of Agreement‖.
Disclosure information for related transaction temporary disclosed
Temporary notice Dated disclosed Website for disclosure
2016-014: Resolution notice of 17th
meeting of 8th session of the Board
2016-017: Notice of re-signing the
―subscription agreement of privately
Juchao Website:
placement with entry-into-force 2016-3-7,2016-4-7
http://www.cninfo.com.cn
conditions‖ in relation to related
transactions
2016-037: Resolution Notice of First
extraordinary general meeting of 2016
VIII. Non-business capital occupying by controlling shareholders and its related parties
□ Applicable √ Not applicable
No non-business capital occupied by controlling shareholders and its related parties in Period.
IX. Significant contract and implementations
77
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
1. Entrust, contract and leasing
(1) Entrust
□ Applicable √ Not applicable
No entrust in Period.
(2) Contract
□ Applicable √ Not applicable
No contract in Period.
(3) Leasing
√ Applicable □Not applicable
Operational leasing of the Company please found more details in ―investment real estate‖,
―fixed assets‖, ―Lease of related party‖ and ―Rent of related party‖ in Note of Financial Statement.
Gains/losses to the Company from projects that reached over 10% in total profit of the
Company in reporting period
□Applicable √ Not applicable
No gains or losses to the Company from projects that reached over 10% in total profit of the
Company in reporting period.
2. Guarantee
√ Applicable □Not applicable
1. Guarantee
During the reporting period, the guarantees that the company provides for its wholly-owned
and holding subsidiaries are for the loans generated by supporting their production and operation,
the guaranty type is assurance; the guarantees that the company and subsidiaries provide for the
distributors are to provide joint liability guarantees for the high quality distributors conforming to
certain conditions within the line of credit of designated banks, the E-bank acceptance bills opened
78
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
under this line of credit are all used for the distributors to pay the purchase payment for goods to
the Company and subsidiaries, aiming to promote the company’s channel business development,
strengthen the good cooperative relationship between the company and the downstream
distributors, and effectively stimulate the company and its subsidiaries’ sales growth.
Up to June 30, 2016, the company has granted credit to the guarantees of some wholly-owned
and holding subsidiaries, in addition to the wholly-owned subsidiary Zhongshan Changhong, other
subsidiaries have no actual guarantee; meanwhile, the company and its subsidiaries have granted
credit to the guarantees of some high quality distributors, the balance of guarantees is within the
line of credit. The external guarantees of the Company and subsidiaries are as follows:
79
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
In 10 thousand Yuan
Particulars about the external guarantee of the Company and subsidiaries (Barring the guarantee for subsidiaries)
Complete
Actual
Name of the Company Actual date of happening Guarant Guarant implement Guarantee for related
Related Announcement disclosure date Guarantee limit guarantee
guaranteed (Date of signing agreement) ee type ee term ation or party
limit
not
Dealer of Hefei Meiling Notice No.: 2015-038,No.: 2015-040 and No.: Joint
Co., Ltd. 2015-064 on 29 August 2015 and 23 December 20,000 2016-3-11 551.98 liability 1 year No No
2015 guaranty
Dealer of Sichuan Notice No.: 2015-038,No.: 2015-040 and No.: Joint
Changhong Air-conditioner 2015-064 on 29 August 2015 and 23 December 20,000 2016-1-15 30 liability 1 year No No
Co., Ltd. 2015 guaranty
Total actual occurred external guarantee in report
Total approving external guarantee in report period (A1) 40,000 581.98
period (A2)
Total actual balance of external guarantee at the end
Total approved external guarantee at the end of report period ( A3) 40,000 581.98
of report period (A4)
Guarantee between the Company and the subsidiaries
Complete
Actual
Name of the Company Actual date of happening Guarant Guarant implement Guarantee for related
Related Announcement disclosure date Guarantee limit guarantee
guaranteed (Date of signing agreement) ee type ee term ation or party
limit
not
Joint
5,000(Note
2015-5-27 liability 1 year No No
1)
guaranty
Notice No.: 2015-003,No.: 2015-007 and No.:
Joint
Zhongshan Changhong 2015-015 on 26 March 2015 and 28 April 2015 and
56,500 2015-3-30 8,000 liability 1 year Yes No
Electric Co., LTD Notice No.: 2016-027,No.: 2016-031 and No.:
guaranty
2016-046 on 25 March 2016 and 5 May 2016
Joint
2015-12-29 15,000 liability 1 year No No
guaranty
80
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Joint
17,000(Note
2015-12-30 liability 1 year No No
2)
guaranty
Joint
Zhongke Meiling Cryogenic Notice No.: 2016-027,No.: 2016-031 and No.:
2,000 - 0 liability - - -
Technology Co., Ltd. 2016-046 on 25 March 2016 and 5 May 2016
guaranty
Joint
Guangdong Changhong Notice No.: 2016-027,No.: 2016-031 and No.:
8,500 - 0 liability - - -
Ridian Technology Co., Ltd. 2016-046 on 25 March 2016 and 5 May 2016
guaranty
Total amount of actual occurred guarantee for
Total amount of approving guarantee for subsidiaries in report period (B1) 67,000 45,000
subsidiaries in report period (B2)
Total amount of approved guarantee for subsidiaries at the end of reporting period Total balance of actual guarantee for subsidiaries at
67,000 37,000
(B3) the end of reporting period (B4)
Guarantee of the subsidiaries for the subsidiaries
Complete
Actual
Name of the Company Actual date of happening Guarant Guarant implement Guarantee for related
Related Announcement disclosure date Guarantee limit guarantee
guaranteed (Date of signing agreement) ee type ee term ation or party
limit
not
N/A - - - - - - - -
Total amount of actual occurred guarantee for
Total amount of approving guarantee for subsidiaries in report period (C1) - -
subsidiaries in report period (C2)
Total amount of approved guarantee for subsidiaries at the end of reporting Total balance of actual guarantee for subsidiaries at
- -
period (C3) the end of reporting period (C4)
Total amount of guarantee of the Company( total of three abovementioned guarantee)
Total amount of actual occurred guarantee in report
Total amount of approving guarantee in report period (A1+B1+C1) 107,000 45,581.98
period (A2+B2+C2)
Total balance of actual guarantee at the end of
Total amount of approved guarantee at the end of report period (A3+B3+C3) 107,000 37,581.98
report period (A4+B4+C4)
The proportion of the total amount of actually guarantee in the net assets of the Company (that is 10.92%
81
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
A4+ B4+C4)(%)
Including:
Amount of guarantee for shareholders, actual controller and its related parties(D) 0
The debts guarantee amount provided for the guaranteed parties whose assets-liability ratio exceed 70% directly or indirectly(E) 45,000
Proportion of total amount of guarantee in net assets of the Company exceed 50%(F) 0
Total amount of the aforesaid three guarantees(D+E+F) 45,000
Explanations on possibly bearing joint and several liquidating responsibilities for undue guarantees (if applicable) -
Explanations on external guarantee against regulated procedures (if applicable) -
Note 1: The guarantee business of Zhongshan Changhong signed the agreement on 27 May 2015, the implementation time is : 29 September 2015 to 29 September 2016.
Note 2: The guarantee business of Zhongshan Changhong signed the agreement on 30 December 2015, the implementation time is : 1 January 2016 to 31 December 2016.
The above guarantees are all wholly-owned and holding subsidiaries of the Company. Production and operation of these wholly-owned and holding subsidiaries was normal with no
overdue unpaid loans and guarantee risk is controllable. During the reporting period, the highest level of security the Company provided amounted to 670,000,000 Yuan by the approval, the
actual amount of guarantee is 450,000,000 Yuan. The highest level of security the Company and subsidiaries provided outside amounted to 400,000,000 Yuan by the approval, the actual amount
of guarantee is 5,819,800 Yuan. At the end of the reporting period, the practical guarantee balance amounted to 375,819,800 Yuan, accounting for the Company’s latest net assets ratio of
10.92%.
82
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Explanation on guarantee with composite way
□ Applicable √ Not applicable
2. Guarantee outside against the regulation
□ Applicable √ Not applicable
No guarantee outside against the regulation in Period.
3. Other significant contract
□Applicable √ Not applicable
No other significant contract in Period.
4. Other significant transaction
□Applicable √ Not applicable
No other significant transaction in Period.
X. Commitments from the Company or shareholder with over 5% share held in
reporting period or occurred in prior period but continues to reporting period
√ Applicable □Not applicable
83
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Implemen
Commitment Acceptor Content Date Term
tation
1. The acquirer shall not engage in refrigerator business
or activity which competes or will compete with
Strictly
business of Meiling Electrical Appliances Co., Ltd. Valid for long
implemen
(hereinafter referred to as the ―Meiling Electrical term
ted
Appliances‖),or that which has interest conflict with
Meiling Electrical Appliances.
2. The acquirer promises to apply shareholders’ right on
Sichuan About committed and Strictly
a legal and reasonable manner and shall not take any Valid for long
Commitments Changhong promised in order to implemen
action to limit or affect the normal operation of Meiling term
made in Electric Co., prevent horizontal ted
Electrical Appliances.
acquisition LTD competition in the
2007-6-12
report or (hereinafter Acquisition Report of 3. For any opportunity to engage in competing business,
equity change referred to as Hefei Meiling Co., the acquirer will advise Meiling Electrical Appliances in
report the ―Sichuan Ltd. written for engaging such business or not. If Meiling
Changhong‖) Electrical Appliances gives no clear written reply as to
whether engaging the competing business or not within Strictly
Valid for long
20 days after receipt of the aforesaid letter, it shall be implemen
term
deemed that it will not engage in such business. The ted
acquirer will only engage in non-competing business
provided that Meiling Electrical Appliances confirms
not to or is deemed to not engage in such
non-competing business.
Commitment Commitment 1. It will not engage in such business or activity that
Strictly
made during Sichuan regarding to reducing competes with or has interest conflict with that of Valid for long
2010-6-24 implemen
the Changhong and preventing Meiling Electrical Appliances except for the action term
ted
non-public competition with taken for sake of Meiling Electrical Appliances as
84
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
offer in 2010 Meiling Electrical required by Meiling Electrical Appliances.
Appliances 2. The Company promises to apply shareholders’ right
on a legal and reasonable manner and shall not take any
action to limit or affect the normal operation of Meiling
Electrical Appliances.
3. In case that Meiling Electrical Appliances expects, on
the basis of its existing business, to expand its operation
scope into the business which the Company has already
operated, the Company agrees to grant pre emptive right
to Meiling Electrical Appliances regarding such
business if the same conditions are met, provided that
the Company is still the controlling shareholder or
actual controller of Meiling Electrical Appliances.
1. Measures will be adopted to prevent continued related
transaction with Meiling Electrical Appliances: as to the
related transaction that can not be prevented, it will sign
related transaction agreement with Meiling Electrical
Appliances under the market principles of ―equally paid
Commitment and mutual benefit‖, and fairly determined the
regarding to reducing transaction price according to the market prevailing
standards. Strictly
and standardizing Valid for long
2010-6-24 implemen
related transaction 2. Perform the necessary obligations to make related term
ted
with Meiling directors and related shareholder abstain from voting
Electrical Appliances according to relevant regulation, and observe legal
procedure for approving related transaction and
information disclosure obligations.
3. Promise not to hurt legal interests of Meiling
Electrical Appliances and other shareholders through
related transaction.
85
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Commit to authorized Changhong Air Conditioning and Zhongshan Air Strictly
Valid for long
Conditioning Co., Ltd. (hereinafter referred to as the ―Zhongshan Air 2010-11-6 implemen
term
Conditioning‖) to use ―Changhong‖ trademark and relevant patents for free. ted
1. Commit to disclose periodic reports on a truthful, accurate, complete, fair and
prompt manner, to disclose all the information that have important influences
over investors, to accept supervision under the CSRC and Shenzhen Stock
Exchange.
2. Commit to make public clarification in respect of such information that is
released from any public media and may result in misleading influences on
Strictly
stock price once the Company is aware of such information. Valid for long
The Company 2011-1-7 implemen
3. The directors, supervisors, senior management and core technicians of the term
ted
Company will accept opinions and criticism from the social publics, and they
will not trade the Company’s securities, directly or indirectly, with any inside
information and other illegal methods. The Company promises that the
documents submitted to Shenzhen Stock Exchange exist no false statement or
material omission, and no relevant information will be disclosed during the
application for listing without prior content from Shenzhen Stock Exchange.
1. Since the property transfer didn’t involve the buildings and land currently
Strictly
Commitment used by Changhong Air Conditioning, Sichuan Changhong commits, upon the Valid for long
implemen
made in completion of equity transfer, to continue to lease such assets to Changhong Air term
ted
transfer of Conditioning at market price.
Sichuan
air 2. After completion of this property transfer, Sichuan Changhong commits to 2009-12-10
Changhong
conditioning manage to prevent new related transaction with Meiling Electrical Appliances. Strictly
Valid for long
assets For those which can not be prevented, Sichuan Changhong commits to implemen
term
property determine the transaction price based on market accepted methods, so as to ted
ensure fairness of related transaction and protection of the interest of Meiling
86
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Electrical Appliances.
3. Sichuan Changhong commits that it will not engage in air conditioning and
refrigerator business or activity which competes or will compete with business
of Meiling Electrical Appliances, or that which has interest conflict with
Meiling Electrical Appliances.
1. Make promise not to reduce the shares of Meiling bought in every year
Commitments
during implementation of the performance incentive fund via any market ways 2013-8-15, Three years after
by Annual Implemen
in the later first year, which was allowed to be reduced by 50% according to the 2014-7-3, current shares
performance ting
laws and regulations in the second year, and the remaining 50% was allowed to 2015-7-21 purchased
incentive Some of the
be reduced in the third year in accordance with the laws and regulations.
fund, Directors,
From the date
incentive supervisors and 2. The directors, supervisors and senior management promised to manage in
when annual
objects while senior accordance with the relevant management approaches in accordance with the
incentive fund
purchasing executives of "Company Law", "Securities Law" and "The Company’s shares held by the
plan deliberated
stock of the the Company as directors, supervisors and senior management of the listed company and its
2013-8-15, and approved by
Company well as other change management rules", as objects of annual performance incentive fund of Implemen
2014-7-3, general meeting
with incentive Meiling, including but not limited to: during his tenure, the shares transferred ting
2015-7-21 to 6 moths after
performance objects each year shall not exceed 25% of the total number of shares held of the
director,
incentive Company; shall not sell the shares of the Company within six months after
supervisor and
funds and bought it or purchase again six months after sold it; shall not transfer the shares
senior executives
owned fund held within six months after Dismission.
resigned
Sichuan 1. Based on market conditions and as allowed by laws and rules, multiple
Changhong measures were adopted adequately to increase shareholding of Meiling
Commitments
Electric Co., Appliances, so as to demonstrate its firm confidence on the PRC economy and Strictly
of not to Valid for long
LTD and Meiling Appliances with its actual actions, maintain sound development of 2015-7-9 implemen
reducing the term
persons acting capital market and promote recovery of healthy market; ted
shares
in concert 2. The Company continued to support operation and development of listed
Changhong company. It is committed to bringing steady and real return to investors.
87
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(Hong Kong) 3. Sichuan Changhong has committed that Sichuan Changhong and its persons
Trading acting in concert - Changhong (Hong Kong) Trading Co., Ltd. shall not reduce
Company holdings of "Meiling" and "Anhui Meiling B" within six months since January
Implemen
Limited 18, 2016, if the holdings of "Meiling" and "Anhui Meiling B" increase due to 2016-1-18 2016-7-18
ted
Meiling bonus issue or share capital increased by transferring, the company will
still abide by the above commitment. To violate the above commitment, all
gains by reducing holdings will belong to Meiling.
1. Plans to subscribe 24.88% A shares of Meiling non-publically offer for year In thirty-six (36)
Failure to
of 2016. months since the
Sichuan act the
2. Shares subscription of the Meiling non-publically offer for year of 2016 2016-3-6 private
Changhong commitm
should no be transfer in thirty-six (36) months since the private placement placement of the
ent
closed Company closed
1. I hereby undertake not to deliver interests to other
entities or individuals without consideration or at unfair
conditions, nor to prejudice the Company’s interests by
Commitment other means.
made during 2. I hereby undertake to restrain my role related Till the
the Commitment on consumption behaviors. completion of
non-public Directors and compensation of 3. I hereby undertake not to conduct any investment and projects invested
offer in 2016 senior immediate dilution of consumption which is not related to performance of with the proceeds Implemen
2016-2-23
executives of return arising from duties with utilization of any company assets. from this ting
the Company non-public issuance of non-public
4. I hereby undertake that the remuneration system
shares issuance of
determined by the board of directors or the remuneration
shares
and examination committee be linked to implementation
of the compensation of return measures.
5. In case that the Company adopts share based
incentive plan in future, I hereby undertake that the
exercise conditions of the incentive plan to be
88
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
announced by the Company be linked to implementation
of the compensation of return measures.
6. For the period from the date of this commitment to
the date of completion of this non-public issuance of
shares, if the CSRC makes other new regulatory
requirements on compensation of return measures and
the commitment thereof, and in case that the above
commitments cannot satisfy these new requirements
from the CSRC, I hereby undertake to issue
supplementary commitment in compliance with the
latest CSRC requirements.
As one of the principals responsible for compensation of
return measures, I, in case of break of the above
commitments or refuse to perform the above
commitments, agree to receive relevant punishment or
to adopt relevant administration measures according to
the systems, rules and regulations of the CSRC and
Shenzhen Stock Exchange.
Perform the commitment promptly or
√ Yes □ No
not
If the commitments is not fulfilled on
time, shall explain the specify reason Non-applicable
and the next work plan
Note: for the commitments completed and exemption for implementing in above mentioned table, the Company will not disclose in next ordinary report
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
XI. Appointment and non-reappointment (dismissal) of CPA
Whether the semi-annual financial report had been audited
□Yes √ No
The semi-annual report was not audited
XII. Penalty and rectification
□ Applicable √ Not applicable
No penalty or rectification in Period.
XIII. Risk disclosure of delisting with laws and rules violated
□Applicable √ Not applicable
The Company has no delisting risks with laws and rules violated in Period.
XIV. Other significant issues
√ Applicable □Not applicable
(I) The Company’s non-public offering
The company held the twelfth meeting of the eighth board of directors and the second
extraordinary general meeting of 2015 on November 18, 2015 and December 22, 2015 which
decided and passed the non-public offering. On January 29, 2016, according to the requirements of
"Review and feedback notification about administrative licensing project of China Securities
Regulatory Commission" (No. 153769) (hereinafter referred to as "Feedback") issued by China
Securities Regulatory Commission, the company and the relevant agencies have replied and
explained the questions in the Feedback term by term and fulfilled the obligation of information
disclosure.
During the reporting period, according to changes in the domestic securities market and
combining with the actual situation of the company, in order to ensure the company’s non-public
offering go smoothly, the company’s seventeenth meeting of the eighth board of directors and the
first extraordinary general meeting of 2016 have decided and agreed the company to adjust the
90
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
offering price, pricing principles and issuance number of this non-public offering project, and
prolong the period of validity of this issuance resolution in the original non-public offering project
at the same time, other contents remain unchanged. In addition, according to the requirements of
"Guidance on the first issue and refinancing, and diluted returns at sight of major asset
restructuring" (CSRC Announcement No. [2015] 31) and other relevant regulations, the company
has developed the diluted returns at sight and filling measures for non-public offering of shares,
and the company directors and senior management have made corresponding commitments.
Details were disclosed on information disclosure media appointed by the Company as
"Securities Times", "Chinese Securities Daily", "Hong Kong Commercial Daily" and the Juchao
website (www.cninfo.com.cn) respectively dated 19 November 2015, 23 December 2015, 30
December 2015, 30 January 2016, 24 February 2016, 7 March 2016, 19 March 2016, 25 March
2016, 7 April 2016 in the form of announcement (No.: 2015-053, No.: 2015-054, No.: 2015-057,
No.: 2015-063, No.: 2015-064, No.: 2015-065, No.: 2015-070, No.: 2016-006, No.: 2016-007, No.:
2016-009, No.: 2016-010, No.: 2016-011, No.: 2016-012, No.: 2016-014, No.: 2016-015, No.:
2016-016, No.: 2016-017, No.: 2016-018, No.: 2016-019, No.: 2016-024, No.: 2016-037 as well as
the Semi-annual report of 2015 and 1Q report of 2016).
On April 1, 2016, the company received Sichuan state-owned assets property right No. [2016]
18 file "Official reply of the State-owned Assets Supervision and Administration Commission of
Sichuan Provincial Government to the issues related to the adjustment of non-public offering plan
of Hefei Meiling Co., Ltd." forwarded by the controlling shareholder Sichuan Changhong Electric
Co., Ltd., the State-owned Assets Supervision and Administration Commission of Sichuan
Provincial Government has agreed in principle to the company’s adjusted non-public offering plan.
On April 7, 2016, the company submitted "Request for instructions about the resumption of
reviewing the non-public offering application document of Hefei Meiling Co., Ltd." to China
Securities Regulatory Commission. On April 21, 2016, the company received the "Notice about the
resumption of the review of administrative licensing application from China Securities Regulatory
Commission" (No. 153769), China Securities Regulatory Commission has resumed the review to
the administrative licensing application of the company’s non-public offering. On April 29, 2016,
the Issuance Examination Commission of China Securities Regulatory Commission examined the
91
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
application of the company’s adjusted non-public offering of A shares. According to the
examination results, the application of the company’s non-public offering of A shares has been
approved.
In light of the completion of profit distribution plan for year of 2015 on 19 May 2016, the
―Offering price and issuance number of the privately placement adjustment after implementation
of profit distribution plan for year of 2015‖ (Notice No.: 2016-049) released on the appointed
media Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao
Website (www.cninfo.com.cn). The offering price adjusted to no less favorable than 4.70 Yuan/ Share
from no less favorable than 4.76 Yuan/ Share; issuance number turns to no more than 334,042,553
shares (to hold a numer’s above) from no more than 329,831,933 shares (to hold a number’s
above).
On 25 July 2016, the Reply on Approval of Private Offering under the name of Hefei Meiling
Co., Ltd.(ZJXK[2016]No.1396) was received by the Company from CSRC. Board of Directors of
the Company will handle relevant non-public placement within time limit, in line with the CSRC’s
approval requirement, with autorotation by shareholders meeting.
Details were disclosed on information disclosure media appointed by the Company as
"Securities Times", "Chinese Securities Daily", "Hong Kong Commercial Daily" and the Juchao
website (www.cninfo.com.cn) respectively dated 2 April 2016, 23 April 2016, 30 April 2016, 19
May 2016, 26 July 2016 in the form of announcement (No.: 2016-036, No.: 2016-040, No.:
2016-045, No.: 2016-049 and No.: 2016-051).
(II) As approved by resolutions at the 18th meeting of the 8th session of the Board and 1st
temporary annual general meeting of 2016, the Company and subsidiary companies are approved
to make foreign exchange forward deals from 1 July 2016 to 30 June 2017, with deal balance not
exceeding USD 500 million and the maximum settlement period for single deal not exceeding two
years. Details have been disclosed by the Company by way of announcements (No. 2016-020,
2016-022, 2016-037) on the designated information disclosure media including Securities Times,
China Securities, Hong Kong Commercial Daily and Juchao Information Website
(www.cninfo.com.cn) on 19 March 2016 and 7 April 2016.
(III) As approved by the 19th session of the 8th BOD, the Company agree the capital increment
in ChanghongRubaTradingCompany (Private) Limited (the joint venture sales company in
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Pakistan established earlier by the follow two parties) in way of cash based on the current
share-holding ratio between the subsidiary Zhongshan Changhong Electric Co., Ltd. (―Zhongshan
Changhong‖) and its partner UAE RUBAGENERALTRADINGFZE, total capital for increment
amounting to US$ 6.4 million. Details were disclosed on information disclosure media appointed
by the Company as "Securities Times", "Chinese Securities Daily", "Hong Kong Commercial
Daily" and the Juchao website (www.cninfo.com.cn) respectively dated 25 March 2016 in the form
of announcement (No.: 2016-027 and No.: 2016-032).
(IV) As approved by the 19th session of the 8th BOD, the Company agrees to set up a
subsidiary ―PT.CHANGHONGMEILINGELECTRICINDONESIA‖ in Indonesia by jointly
investment between subsidiary Zhongshan Changhong and Sichuan Changhong Air-conditioner
Co., Ltd., registered capital amounting to US$ 6 million. Details were disclosed on information
disclosure media appointed by the Company as "Securities Times", "Chinese Securities Daily",
"Hong Kong Commercial Daily" and the Juchao website (www.cninfo.com.cn) respectively dated
25 March 2016 in the form of announcement (No.: 2016-027 and No.: 2016-033).
(V) As approved by 19th session of the 8th BOD, the Company agreed to applying a 300
million Yuan at most credit line of bank notes pool to Hefei Branch of China Merchants Bank Co.,
Ltd. for one year, Credit varieties mainly use in the business of notes pool, and endorsement for
pledge. Details were disclosed on information disclosure media appointed by the Company as
"Securities Times", "Chinese Securities Daily", "Hong Kong Commercial Daily" and the Juchao
website (www.cninfo.com.cn) respectively dated 25 March 2016 in the form of announcement
(No.: 2016-027 and No.: 2016-034).
(VI) According to the resolution of the tenth meeting of the eighth board of directors held on
August 28, 2015, the company's board of directors agreed the subsidiary - Zhongke Meiling
Cryogenics Co., Ltd. to start the restructuring and set up the limited liability company, and apply
for the listing in the National Equities Exchange and Quotations after the overall restructuring.
After being audited and approved by National Equities Exchange and Quotations Co., Ltd.,
Zhongke Meiling has been listed in National Equities Exchange and Quotations on February 24,
2016, the security is referred to as "Zhongke Meiling", and the stock code is "835892." Details
have been disclosed by the Company by way of announcement (No. 2015-038, No.2015-039, No.:
2015-041, No.: 2015-050, No.: 2016-006 and No.2016-013) on the designated information
disclosure media including Securities Times, China Securities, Hong Kong Commercial Daily and
Juchao Information Website (www.cninfo.com.cn) on 29 August 2015, 16 September, 3 November
2015, 23 January 2016 and 24 February 2016.
93
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(VII) Implementation for annual performance incentive fund
On August 9, 2012 and August 28, 2012, the Company considers the adoption of "Hefei
Meiling annual performance incentive fund implementation plan" (hereinafter referred to as ""
stimulus "") on the 16th meeting of the 7th board of directors and the 2012-second provisional
shareholders meeting. Details were disclosed on information disclosure media appointed by the
Company as "Securities Times", "Chinese Securities Daily", "Hong Kong Commercial Daily" and
the Juchao network (www.cninfo.com.cn) on August 10, 2012 and August 29th in the form of
announcement (2012-028, 2012-035).
1. Implementation about 2012, 2013 and 2014 performance incentive fund provision and
distribution plan
See details in "Implementation of the company's annual incentive fund" in "XV
Implementation of the company's stock incentive plan, employee stock ownership plan, or other
employee incentive measures" in "Section V Significant Events" of the company's "2015
Annual Report" disclosed on March 25, 2016.
Up to the end of this reporting period, the company's stock purchased by some 2012 annual
performance incentive objects (non-directors, supervisors and senior management) with their
granted 2012 annual performance incentive funds and own funds has been fully desterilized, the
company's stock purchased by some 2013 annual performance incentive objects (non-directors,
supervisors and senior management) with their granted 2013 annual performance incentive funds
and own funds has been desterilized by 50%, see below for the overall reducing holding-shares of
some above-mentioned incentive objects; if the stock holding period of the company's stock
purchased by 2014 annual performance incentive objects with their granted 2014 annual
performance incentive funds and own funds is less than one year, the purchased stock of all
incentive objects should be locked according to the commitments. Among the incentive objects,
the current directors, supervisors and senior management have not reduced the Company’s shares
purchased by implementing 2012, 2013, and 2014 annual performance incentive plans.
2. Shareholding and reducing of performance incentive objects of the Company
Ended as 30 June 2016, shares hold by all incentive objects amounting to 10,386,002 shares, a
1.36 % in total share capital of the Company, including 9,052,870 A-share, a 1.19% in total share
capital and 1,333,132 B-share, a 0.17% in total share capital of the Company. Ended as 30 June
2016, other grantees of the 2012 and 2013 incentive plan (not being directors, supervisors and
senior management) have reduced holding of 3,093,454 in aggregate, accounting for about 0.41%
94
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
of the total share capital, since September 2014 to the end of the reporting period, including
reduced holding of 976,101 in the reporting period, accounting for about 0.13% of the total share
capital.
XV. Issuance of corporate bonds
Whether the company has corporate bonds that have been publicly issued and listed on the
stock exchange, and not yet due or due but not fully cashed on the approval date of annual report
No
95
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
Before the Change Increase/Decrease in the Change (+, -) After the Change
New Capitalizatio
Proportio Bonus Proportio
Amount shares n of public Others Subtotal Amount
n shares n
issued reserve
I. Restricted shares 9,965,170 1.30% 0 0 0 -522,100 -522,100 9,443,070 1.24%
1. State-owned shares 0 0.00% 0 0 0 0 0 0 0.00%
2. State-owned legal
915,987 0.12% 0 0 0 0 0 915,987 0.12%
person’s shares
3. Other domestic shares 8,049,334 1.05% 0 0 0 -522,100 -522,100 7,527,234 0.99%
Including: domestic
4,839,035 0.63% 0 0 0 0 0 4,839,035 0.63%
legal person’s shares
Domestic
3,210,299 0.42% 0 0 0 -522,100 -522,100 2,688,199 0.36%
natural person’s shares
4. Foreign shares 999,849 0.13% 0 0 0 0 0 999,849 0.13%
Including: Foreign legal
0 0.00% 0 0 0 0 0 0 0.00%
person’s shares
Foreign
999,849 0.13% 0 0 0 0 0 999,849 0.13%
natural person’s shares
II. Unrestricted shares 753,774,035 98.70% 0 0 0 522,100 522,100 754,296,135 98.76%
1. RMB Ordinary shares 591,909,884 77.50% 0 0 0 522,100 522,100 592,431,984 77.57%
2. Domestically listed
161,864,151 21.20% 0 0 0 0 0 161,864,151 21.19%
foreign shares
3. Overseas listed
0 0.00% 0 0 0 0 0 0 0.00%
foreign shares
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
III. Total shares 763,739,205 100.00% 0 0 0 0 0 763,739,205 100.00%
(I) Reasons for share changed
√ Applicable □Not applicable
During the period, former senior executive Mr. Deng Xiaohui has resigned over 6 months, the
522,100 shares held by Mr. Deng has released for trading.
96
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(II) Approval of share changed
□ Applicable √ Not applicable
(III) Ownership transfer of share changed
□ Applicable √ Not applicable
(IV) 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
(V) Other information necessary to disclose for the Company or need to disclosed under
requirement from security regulators
□ Applicable √ Not applicable
(VI) Explanation on changes of total shares, shareholders structure and assets & liability
structures
□ Applicable √ Not applicable
II. Amount of shareholders of the Company and particulars about shares holding
Unit: share
Total preference shareholders with
Total common shareholders in reporting
64,764 voting rights recovered at end of 0
period-end
reporting period (if applicable)
Particulars about shares held above 5% by common shareholders or top 10 common shares holding
Number of
share
Total common Amount of Amount of
Proporti pledged/froze
Nature of on of shareholders at Changes in restricted un-restricted
n
Full name of Shareholders
shareholder shares the end of report period common common shares
held State
report period shares held held Amo
of
unt
share
Sichuan Changhong Electric State-owned legal
21.58% 164,828,330 -- 0 164,828,330 -- --
Co., LTD person
Hefei Industry Investment State-owned legal
6.26% 47,823,401 47,823,401 0 47,823,401 -- --
Holding (Group) Co., Ltd. person
97
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Changhong (Hong Kong)
Foreign legal person 3.30% 25,165,823 -- 0 25,165,823 -- --
Trading Company Limited
Foreign natural
CAOSHENGCHUN 1.75% 13,360,815 3,700 0 13,360,815 -- --
person
China Securities Finance Domestic general
0.58% 4,399,500 -- 0 4,399,500 -- --
Corporation Limited legal person
Harvest Assets Management –
Domestic non
Minsheng Bank- Harvest Capital
state-owned 0.57% 4,364,043 4,364,043 0 4,364,043 -- --
Tianxingjian No. 5 Assets
corporate
Management Plan
NORGESBANK Foreign legal person 0.55% 4,216,432 -- 0 4,216,432 -- --
ICBC-Nanfang Longyuan Domestic non
Industry Theme Stock state-owned 0.46% 3,488,500 3,488,500 0 3,488,500 -- --
Investment Fund corporate
Foreign natural
Long Qinfang 0.43% 3,294,937 55,640 0 3,294,937 -- --
person
Domestic non
CCB-Bosch Zhongzheng Taojin
state-owned 0.41% 3,127,600 2,776,000 0 3,127,600 -- --
Data 100 Index Stock Fund
corporate
Strategy investors or general legal person becomes top
10 common shareholders due to rights issued (if Not applicable
applicable)
Among the above shareholders, Changhong (Hong Kong) Trade Co., Ltd. is the
wholly-owned subsidiary of Sichuan Changhong Electronic Co., Ltd.; there existed no
associated relationship or belong to the concerted actors as specified in the Measures for
the Administration of Information Disclosure of Shareholder Equity Changes of Listed
Explanation on associated relationship among the Companies among Sichuan Changhong Electronic Co., Ltd., Changhong (Hong Kong)
aforesaid shareholders Trade Co., Ltd. and other top 8 shareholders; and top ten shareholders with unrestricted
subscription; as the Company has not known whether there exists any business
relationship among the other shareholders with unrestricted subscription or they belong to
the concerted actors as specified in the Measures for the Administration of Information
Disclosure of Shareholder Equity Changes of Listed Companies.
Particular about top ten common shareholders with un-restrict shares held
Amount of unrestricted Type of shares
Shareholders’ name common shares held at
Type Amount
reporting period-end
Sichuan Changhong Electric Co., LTD 164,828,330 RMB ordinary shares 164,828,330
Hefei Industry Investment Holding (Group) Co., Ltd. 47,823,401 RMB ordinary shares 47,823,401
Domestically listed
Changhong (Hong Kong) Trading Company Limited 25,165,823 25,165,823
foreign shares
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Domestically listed
CAOSHENGCHUN 13,360,815 13,360,815
foreign shares
China Securities Finance Corporation Limited 4,399,500 RMB ordinary shares 4,399,500
Harvest Assets Management – Minsheng Bank- Harvest
4,364,043 RMB ordinary shares 4,364,043
Capital Tianxingjian No. 5 Assets Management Plan
Domestically listed
NORGESBANK 4,216,432 4,216,432
foreign shares
ICBC-Nanfang Longyuan Industry Theme Stock Investment
3,488,500 RMB ordinary shares 3,488,500
Fund
Domestically listed
Long Qinfang 3,294,937 3,294,937
foreign shares
CCB-Bosch Zhongzheng Taojin Data 100 Index Stock Fund 3,127,600 RMB ordinary shares 3,127,6
Among the above shareholders, Changhong (Hong Kong) Trade Co., Ltd. is the
wholly-owned subsidiary of Sichuan Changhong Electronic Co., Ltd.; there
existed no associated relationship or belong to the concerted actors as specified in
the Measures for the Administration of Information Disclosure of Shareholder
Expiation on associated relationship or consistent actors
Equity Changes of Listed Companies among Sichuan Changhong Electronic Co.,
within the top 10 un-restrict common shareholders and
Ltd., Changhong (Hong Kong) and other top 8 shareholders; and top ten
between top 10 un-restrict common shareholders and top 10
shareholders with unrestricted subscription; as the Company has not known
common shareholders
whether there exists any business relationship among the other shareholders with
unrestricted subscription or they belong to the concerted actors as specified in the
Measures for the Administration of Information Disclosure of Shareholder Equity
Changes of Listed Companies.
Explanation on shareholders involving margin business
Not applicable
among the top ten common shareholder (if applicable)
Agree to buy-back dealings occurred in Period by top 10 common shareholders and top 10
common shareholders with shares restricted for sale
□Yes √No
No agree to buy-back dealings occurred in Period by top 10 common shareholders and top 10
common shareholders with shares restricted for sale
III. Shareholder and actual controller
(I) Changes of controlling shareholder in reporting period
□Applicable √Not applicable
No change of controlling shareholder in reporting period.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(II) Changes of actual controller in reporting period
□Applicable √Not applicable
No changes of actual controller in reporting period.
(III) Changes of other shareholders with over 5% stock held
On March 22, 2016, the company received securities transfer registration confirmation of
China Securities Depository and Clearing Company Limited forwarded by Industry Investment
Holding Group, and the company was informed that the stock transfer registration for the free
transfer of the Company's state-owned shares held by the company's second largest shareholder
Xingtai Holding to Industry Investment Holding Group had been completed, and the transfer date
was March 18, 2016, the transfer number was 47,823,401 shares.
After the completion of this free transfer of shares, Xingtai Holding no longer holds shares of
the Company, Industry Investment Holding Group holds the Company’s unrestricted shares of
47,823,401 shares (excluding the unrecovered 1,654,112 shares paid on behalf of other non-tradable
share shareholders in the company’s reform of non-tradable shares), accounting for 6.26% of the
Company's total share capital. The Company's second largest shareholder changes to Industry
Investment Holding Group. Before and after this transfer of shares, the Company's actual controller
is not changed.
IV. Share holding increasing plan proposed or implemented in reporting period from
shareholder of the Company and its concerted action person
√ Applicable □ Not applicable
On January 18, 2016, Hefei Meiling Co., Ltd. (hereinafter referred to as "the company", "the
Company" or "Meiling") received the "Commitment letter about not reducing holding shares of
Meiling within six months" issued by the company’s controlling shareholder Sichuan Changhong
Electric Co., Ltd. (hereinafter referred to as "Sichuan Changhong"), of which the main contents are
as follows:
With the confidence in the future development and embedded value of Meiling, in order to
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
promote the sustainable, stable and healthy development of Meiling, Sichuan Changhong, as the
controlling shareholder of Meiling, has made commitments that Sichuan Changhong and its persons
acting in concert Changhong (Hong Kong) Trading Co., Ltd. would not reduce the holdings of
"Meiling" and "Anhui Meiling B" shares within six months since 2016 January 18, who would also
comply with the above commitments if its holdings of "Meiling" and "Anhui Meiling B" shares
increased due to the bonus shares and into equity of Meiling. If there is a breach of commitments,
all income from reducing holding-shares shall be owned by Meiling.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the reporting period.
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section VIII. Particular about Directors, Supervisors and Senior
Executives
I. Changes of shares held by directors, supervisors and senior executive
□Applicable √Not applicable
Shares held by directors, supervisors and senior executive of the Company had no changes,
more details can be seen in Annual Report 2015.
II. Changes of directors, supervisors and senior executive
√ Applicable □Not applicable
Name Title Type Date Reasons
Agreed to elect Mr. Xu Bangjun as Director of
Director Be elected 2016-5-4
the Company by approved in AGM of 2015.
Xu Bangjun Agreed to elect Mr. Xu Bangjun as Vice
Vice Chairman Be elected 2016-5-4 Chairman of the Company by approved in 22nd
meeting of 8th session of the Board.
Agreed to elect Mr. Li Wei as Vice Chairman of
Li Wei Vice Chairman Be elected 2016-5-4 the Company by approved in 22nd meeting of 8th
session of the Board.
Resigned the posts of director of 8th BOD of the
Company, deputy chairman, member of strategy
Director,Vice
Li Jin Office leaving 2016-1-20 committee and member of remuneration and
Chairman
appraisal committee due to personal career
moves
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HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section IX. Financial Report
I. Audit reports
Whether the semi-annual report was audited or not
□ Yes √ No
II. Financial statements
Units in Notes of Financial Statements is RMB
1. Consolidated Balance Sheet
Prepared by Hefei Meiling Co., Ltd.
2016-06-30
In RMB
Item Closing balance Opening balance
Current assets:
Monetary funds 4,136,998,121.62 2,135,189,879.15
Settlement provisions
Capital lent
Financial liability measured
by fair value and with variation 2,340,308.20
reckoned into current gains/losses
Derivative financial liability
Notes receivable 1,631,636,037.26 1,286,332,682.74
Accounts receivable 1,950,050,884.81 1,338,396,321.83
Accounts paid in advance 80,966,663.59 68,041,820.73
Insurance receivable
Reinsurance receivables
Contract reserve of
reinsurance receivable
Interest receivable 1,896,655.82 1,238,199.65
Dividend receivable
Other receivables 39,970,407.25 39,494,835.30
Purchase restituted finance
asset
Inventories 1,591,370,410.84 1,554,946,209.51
Divided into assets held for
104
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
sale
Non-current asset due within
one year
Other current assets 30,440,120.40 539,101,578.44
Total current assets 9,465,669,609.79 6,962,741,527.35
Non-current assets:
Loans and payments on
behalf
Finance asset available for
17,000,000.00 17,000,000.00
sales
Held-to-maturity investment
Long-term account
receivable
Long-term equity investment 78,801,651.30 74,239,547.01
Investment property 13,679,922.44 14,084,213.51
Fixed assets 1,250,350,428.82 1,267,493,931.98
Construction in progress 67,818,577.71 56,504,880.99
Engineering material
Disposal of fixed asset 75,788,138.47 75,773,138.47
Productive biological asset
Oil and gas asset
Intangible assets 605,311,268.73 593,449,698.85
Expense on Research and
52,953,014.45 53,344,827.72
Development
Goodwill
Long-term expenses to be
apportioned
Deferred income tax asset 83,444,366.22 78,435,177.86
Other non-current asset 45,158,472.00 44,221,416.00
Total non-current asset 2,290,305,840.14 2,274,546,832.39
Total assets 11,755,975,449.93 9,237,288,359.74
Current liabilities:
Short-term loans 718,762,164.03 58,680,093.19
Loan from central bank
Absorbing deposit and
interbank deposit
Capital borrowed
Financial liability measured 3,618,878.41 -
105
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
by fair value and with variation
reckoned into current gains/losses
Derivative financial liability
Notes payable 2,834,242,595.61 2,172,064,923.79
Accounts payable 2,340,133,319.01 1,604,075,191.50
Accounts received in
305,437,199.80 295,604,800.16
advance
Selling financial asset of
repurchase
Commission charge and
commission payable
Wage payable 78,227,521.05 115,297,429.40
Taxes payable 188,830,607.86 70,530,483.54
Interest payable 35,547.83 214,328.89
Dividend payable 2,545,801.23 2,200,499.91
Other accounts payable 970,734,230.21 643,567,087.33
Reinsurance payables
Insurance contract reserve
Security trading of agency
Security sales of agency
Divided into liability held for
sale
Non-current liabilities due
261,130,799.00 11,153,067.68
within 1 year
Other current liabilities
Total current liabilities 7,703,698,664.04 4,973,387,905.39
Non-current liabilities:
Long-term loans 50,290,088.80 243,004,866.40
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable
Long-term wages payable 30,855,190.28 38,211,463.86
Special accounts payable
Projected liabilities 333,689,789.42 338,125,014.55
Deferred income 132,441,411.65 132,890,618.54
106
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Deferred income tax
liabilities
Other non-current liabilities
Total non-current liabilities 547,276,480.15 752,231,963.35
Total liabilities 8,250,975,144.19 5,725,619,868.74
Owner’s equity:
Share capital 763,739,205.00 763,739,205.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 1,429,225,754.29 1,529,184,356.13
Less: Inventory shares
Other comprehensive income -466,043.54 -2,280,500.61
Reasonable reserve
Surplus public reserve 367,066,994.18 367,066,994.18
Provision of general risk
Retained profit 881,835,880.65 817,667,531.64
Total owner’s equity attributable
3,441,401,790.58 3,475,377,586.34
to parent company
Minority interests 63,598,515.16 36,290,904.66
Total owner’s equity 3,505,000,305.74 3,511,668,491.00
Total liabilities and owner’s
11,755,975,449.93 9,237,288,359.74
equity
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
2. Balance Sheet of Parent Company
In RMB
Item Closing balance Opening balance
Current assets:
Monetary funds 3,300,737,183.98 1,654,499,494.28
Financial liability measured
by fair value and with variation 2,340,308.20 -
reckoned into current gains/losses
Derivative financial liability
107
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Notes receivable 948,643,030.85 828,061,004.44
Accounts receivable 1,107,434,419.44 943,328,995.97
Account paid in advance 196,339,595.35 302,567,578.88
Interest receivable
Dividends receivable
Other receivables 118,314,543.62 53,255,891.89
Inventories 744,714,406.73 869,593,027.59
Divided into assets held for
sale
Non-current assets maturing
within one year
Other current assets 5,384,832.36 522,617,641.34
Total current assets 6,423,908,320.53 5,173,923,634.39
Non-current assets:
Available-for-sale financial
17,000,000.00 17,000,000.00
assets
Held-to-maturity investments
Long-term receivables
Long-term equity
1,009,682,156.77 840,634,581.05
investments
Investment property 11,568,959.64 11,805,903.99
Fixed assets 870,950,248.09 890,217,780.00
Construction in progress 21,114,741.65 20,365,686.01
Project materials
Disposal of fixed assets 43,494,954.71 43,479,954.71
Productive biological assets
Oil and natural gas assets
Intangible assets 433,154,663.49 438,227,183.15
Research and development
7,667,474.13 2,162,829.06
costs
Goodwill
Long-term deferred expenses
Deferred income tax assets 71,390,904.95 70,170,515.47
Other non-current assets
Total non-current assets 2,486,024,103.43 2,334,064,433.44
Total assets 8,909,932,423.96 7,507,988,067.83
108
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Current liabilities:
Short-term borrowings 718,762,164.03 34,411,720.00
Financial liability measured
by fair value and with variation 3,618,878.41 -
reckoned into current gains/losses
Derivative financial liability
Notes payable 1,296,032,554.79 1,395,443,530.25
Accounts payable 1,257,101,368.28 1,114,807,199.47
Accounts received in
348,680,911.95 145,333,375.62
advance
Wage payable 13,811,160.06 42,847,802.62
Taxes payable 77,863,322.85 20,425,867.86
Interest payable 35,547.83 214,328.89
Dividend payable 2,545,801.23 2,200,499.91
Other accounts payable 957,104,786.80 686,009,980.82
Divided into liability held for
sale
Non-current liabilities due
257,465,047.08 7,487,315.76
within 1 year
Other current liabilities
Total current liabilities 4,933,021,543.31 3,449,181,621.20
Non-current liabilities:
Long-term loans 5,701,900.00 199,341,900.00
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable
Long-term wages payable 30,855,190.28 38,211,463.86
Special accounts payable
Projected liabilities 333,689,789.42 338,125,014.55
Deferred income 66,636,513.22 68,050,877.23
Deferred income tax
liabilities
Other non-current liabilities
Total non-current liabilities 436,883,392.92 643,729,255.64
Total liabilities 5,369,904,936.23 4,092,910,876.84
109
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Owners’ equity:
Share capita 763,739,205.00 763,739,205.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 1,493,143,491.54 1,497,987,446.59
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus reserve 366,848,828.50 366,848,828.50
Retained profit 916,295,962.69 786,501,710.90
Total owner’s equity 3,540,027,487.73 3,415,077,190.99
Total liabilities and owner’s
8,909,932,423.96 7,507,988,067.83
equity
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
3. Consolidated Profit Statement
In RMB
Item Current Period Last Period
I. Total operating income 6,866,631,262.68 6,572,479,966.74
Including: Operating income 6,866,631,262.68 6,572,479,966.74
Interest income
Insurance gained
Commission charge and
commission income
II. Total operating cost 6,760,418,778.86 6,403,050,274.08
Including: Operating cost 5,432,461,687.10 5,213,492,703.53
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
110
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee
slip
Reinsurance expense
Operating tax and extras 62,141,577.47 45,722,966.65
Sales expenses 1,075,647,750.60 956,768,853.62
Administration expenses 193,280,424.74 197,283,986.21
Financial expenses -39,699,342.16 -45,676,072.58
Losses of devaluation of asset 36,586,681.11 35,457,836.65
Add: Changing income of fair
-1,278,570.21 3,653,270.00
value(Loss is listed with ―-‖)
Investment income (Loss is
4,153,090.95 -5,484,432.72
listed with ―-‖)
Including: Investment income
on affiliated company and joint -833,210.42 -6,482,572.94
venture
Exchange income (Loss is
listed with ―-‖)
III. Operating profit (Loss is
109,087,004.56 167,598,529.94
listed with ―-‖)
Add: Non-operating income 21,471,702.44 15,011,187.86
Including: Disposal gains
330,833.76 14,784.00
of non-current asset
Less: Non-operating expense 1,818,874.18 9,268,395.87
Including: Disposal loss
1,545,129.64 5,700,586.03
of non-current asset
IV. Total Profit (Loss is listed
128,739,832.82 173,341,321.93
with ―-‖)
Less: Income tax expense 18,816,185.98 14,512,173.60
V. Net profit (Net loss is listed with
109,923,646.84 158,829,148.33
―-‖)
Net profit attributable to
109,992,701.28 158,158,485.22
owner’s of parent company
Minority shareholders’ gains and
-69,054.44 670,663.11
losses
VI. Net after-tax of other
2,484,848.72 -506,008.36
comprehensive income
111
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Net after-tax of other
comprehensive income attributable 1,814,457.07 -379,924.38
to owners of parent company
(I) Other comprehensive
income items which will not be
reclassified subsequently to profit
of loss
1. Changes as a result
of re-measurement of net defined
benefit plan liability or asset
2. Share of the other
comprehensive income of the
investee accounted for using equity
method which will not be
reclassified subsequently to profit
and loss
(II) Other comprehensive
income items which will be
1,814,457.07 -379,924.38
reclassified subsequently to profit
or loss
1. Share of the other
comprehensive income of the
investee accounted for using equity
method which will be reclassified
subsequently to profit or loss
2. Gains or losses
arising from changes in fair value
of available-for-sale financial assets
3. Gains or losses
arising from reclassification of
held-to-maturity investment as
available-for-sale financial assets
4. The effect hedging
portion of gains or losses arising
from cash flow hedging
instruments
5. Translation
differences arising on translation of
1,814,457.07 -379,924.38
foreign currency financial
statements
6. Other
Net after-tax of other 670,391.65 -126,083.98
112
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
comprehensive income attributable
to minority shareholders
VII. Total comprehensive income 112,408,495.56 158,323,139.97
Total comprehensive income
attributable to owners of parent 111,807,158.35 157,778,560.84
Company
Total comprehensive income
attributable to minority 601,337.21 544,579.13
shareholders
VIII. Earnings per share:
(i) Basic earnings per share 0.1440 0.2071
(ii) Diluted earnings per
0.1440 0.2071
share
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
4. Profit Statement of Parent Company
In RMB
Item Current Period Last Period
I. Operating income 3,770,773,163.93 3,723,644,751.94
Less: Operating cost 3,160,132,227.01 3,185,022,932.49
Operating tax and extras 26,796,594.53 21,593,618.43
Sales expenses 421,077,853.44 366,740,764.98
Administration
89,360,579.13 92,172,562.14
expenses
Financial expenses -31,518,036.32 -38,448,636.98
Losses of devaluation of
9,159,976.91 9,251,853.73
asset
Add: Changing income of
-1,278,570.21 3,653,270.00
fair value(Loss is listed with ―-‖)
Investment income (Loss
82,892,597.34 -6,059,877.47
is listed with ―-‖)
Including: Investment
income on affiliated company and 2,644,982.57 -6,577,685.69
joint venture
II. Operating profit (Loss is
177,377,996.36 84,905,049.68
listed with ―-‖)
113
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Add: Non-operating income 14,372,303.76 5,794,628.12
Including: Disposal
269,387.27 -
gains of non-current asset
Less: Non-operating expense 1,216,566.48 7,706,718.05
Including: Disposal loss
1,150,366.91 5,679,902.32
of non-current asset
III. Total Profit (Loss is listed
190,533,733.64 82,992,959.75
with ―-‖)
Less: Income tax expense 14,915,129.58 13,687,467.35
IV. Net profit (Net loss is listed
175,618,604.06 69,305,492.40
with ―-‖)
V. Net after-tax of other
comprehensive income
(I) Other comprehensive
income items which will not be
reclassified subsequently to profit
of loss
1. Changes as a result
of re-measurement of net defined
benefit plan liability or asset
2. Share of the other
comprehensive income of the
investee accounted for using
equity method which will not be
reclassified subsequently to profit
and loss
(II) Other comprehensive
income items which will be
reclassified subsequently to profit
or loss
1. Share of the other
comprehensive income of the
investee accounted for using
equity method which will be
reclassified subsequently to profit
or loss
2. Gains or losses
arising from changes in fair value
of available-for-sale financial
assets
3. Gains or losses
114
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
arising from reclassification of
held-to-maturity investment as
available-for-sale financial assets
4. The effect hedging
portion of gains or losses arising
from cash flow hedging
instruments
5. Translation
differences arising on translation
of foreign currency financial
statements
6. Other
VI. Total comprehensive income 175,618,604.06 69,305,492.40
VII. Earnings per share:
(i) Basic earnings per share 0.2299 0.0907
(ii) Diluted earnings per
0.2299 0.0907
share
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
5. Consolidated Cash Flow Statement
In RMB
Item Current Period Last Period
I. Cash flows arising from
operating activities:
Cash received from selling
commodities and providing labor 6,122,120,567.44 4,875,947,546.26
services
Net increase of customer
deposit and interbank deposit
Net increase of loan from
central bank
Net increase of capital
borrowed from other financial
institution
Cash received from original
insurance contract fee
Net cash received from
115
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
reinsurance business
Net increase of insured
savings and investment
Net increase of amount from
disposal financial assets that
measured by fair value and with
variation reckoned into current
gains/losses
Cash received from interest,
commission charge and
commission
Net increase of capital
borrowed
Net increase of returned
business capital
Write-back of tax received 183,108,861.55 108,433,705.43
Other cash received
19,615,271.12 15,017,563.44
concerning operating activities
Subtotal of cash inflow arising
6,324,844,700.11 4,999,398,815.13
from operating activities
Cash paid for purchasing
commodities and receiving labor 4,321,939,929.71 3,540,454,526.92
service
Net increase of customer
loans and advances
Net increase of deposits in
central bank and interbank
Cash paid for original
insurance contract compensation
Cash paid for interest,
commission charge and
commission
Cash paid for bonus of
guarantee slip
Cash paid to/for staff and
644,386,641.53 569,593,509.27
workers
Taxes paid 168,259,449.49 197,027,218.67
Other cash paid concerning
318,569,174.49 339,950,350.53
operating activities
Subtotal of cash outflow arising 5,453,155,195.22 4,647,025,605.39
116
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
from operating activities
Net cash flows arising from
871,689,504.89 352,373,209.74
operating activities
II. Cash flows arising from
investing activities:
Cash received from
500,000,000.00 100,500,000.00
recovering investment
Cash received from
4,986,301.37 998,140.22
investment income
Net cash received from
disposal of fixed, intangible and 330,776.45 4,188,632.00
other long-term assets
Net cash received from
disposal of subsidiaries and other
units
Other cash received
36,389,716.67 53,413,779.04
concerning investing activities
Subtotal of cash inflow from
541,706,794.49 159,100,551.26
investing activities
Cash paid for purchasing
fixed, intangible and other 65,945,234.00 55,643,871.68
long-term assets
Cash paid for investment 100,883,860.00 170,149,995.00
Net increase of mortgaged
loans
Net cash received from
subsidiaries and other units
obtained
Other cash paid concerning
- 427,715.77
investing activities
Subtotal of cash outflow from
166,829,094.00 226,221,582.45
investing activities
Net cash flows arising from
374,877,700.49 -67,121,031.19
investing activities
III. Cash flows arising from
financing activities
Cash received from
23,145,352.69 -
absorbing investment
Including: Cash received
117
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
from absorbing minority
shareholders’ investment by
subsidiaries
Cash received from loans 797,486,045.88 899,641,581.00
Cash received from issuing
bonds
Other cash received
3,451.80 -
concerning financing activities
Subtotal of cash inflow from
820,634,850.37 899,641,581.00
financing activities
Cash paid for settling debts 88,241,810.84 1,032,938,903.44
Cash paid for dividend and
profit distributing or interest 49,368,745.83 41,213,628.96
paying
Including: Dividend and
profit of minority shareholder
paid by subsidiaries
Other cash paid concerning
98,192.48 224,020.35
financing activities
Subtotal of cash outflow from
137,708,749.15 1,074,376,552.75
financing activities
Net cash flows arising from
682,926,101.22 -174,734,971.75
financing activities
IV. Influence on cash and cash
equivalents due to fluctuation in 12,229,868.87 9,712,947.81
exchange rate
V. Net increase of cash and cash
1,941,723,175.47 120,230,154.61
equivalents
Add: Balance of cash and
cash equivalents at the period 2,121,161,238.01 2,709,097,193.11
-begin
VI. Balance of cash and cash
4,062,884,413.48 2,829,327,347.72
equivalents at the period -end
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
6. Cash Flow Statement of Parent Company
In RMB
118
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Item Current Period Last Period
I. Cash flows arising from
operating activities:
Cash received from selling
commodities and providing labor 3,257,292,398.00 2,587,323,791.86
services
Write-back of tax received 90,212,886.14 50,835,256.44
Other cash received
11,964,243.27 5,957,421.13
concerning operating activities
Subtotal of cash inflow arising
3,359,469,527.41 2,644,116,469.43
from operating activities
Cash paid for purchasing
commodities and receiving labor 2,456,420,547.09 2,301,440,737.17
service
Cash paid to/for staff and
257,679,481.30 196,459,026.37
workers
Taxes paid 58,375,692.51 62,883,474.12
Other cash paid concerning
135,616,094.86 144,418,281.65
operating activities
Subtotal of cash outflow arising
2,908,091,815.76 2,705,201,519.31
from operating activities
Net cash flows arising from
451,377,711.65 -61,085,049.88
operating activities
II. Cash flows arising from
investing activities:
Cash received from
500,000,000.00 100,000,000.00
recovering investment
Cash received from
80,247,614.77 517,808.22
investment income
Net cash received from
disposal of fixed, intangible and 240,112.02 969,312.00
other long-term assets
Net cash received from
disposal of subsidiaries and other
units
Other cash received
28,290,477.04 38,798,411.37
concerning investing activities
Subtotal of cash inflow from
608,778,203.83 140,285,531.59
investing activities
119
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Cash paid for purchasing
fixed, intangible and other 37,238,789.69 23,752,926.57
long-term assets
Cash paid for investment 171,250,000.00 115,000,000.00
Net cash received from
subsidiaries and other units
Other cash paid concerning
63,665,205.65 427,715.77
investing activities
Subtotal of cash outflow from
272,153,995.34 139,180,642.34
investing activities
Net cash flows arising from
336,624,208.49 1,104,889.25
investing activities
III. Cash flows arising from
financing activities
Cash received from
absorbing investment
Cash received from loans 794,126,025.52 811,087,023.59
Cash received from issuing
bonds
Other cash received
217,115,708.21 186,369,209.14
concerning financing activities
Subtotal of cash inflow from
1,011,241,733.73 997,456,232.73
financing activities
Cash paid for settling debts 60,135,614.84 970,217,403.44
Cash paid for dividend and
profit distributing or interest 48,236,007.73 39,915,654.04
paying
Other cash paid concerning
56,057,512.35 96,136,206.56
financing activities
Subtotal of cash outflow from
164,429,134.92 1,106,269,264.04
financing activities
Net cash flows arising from
846,812,598.81 -108,813,031.31
financing activities
IV. Influence on cash and cash
equivalents due to fluctuation in 11,423,170.75 6,994,571.70
exchange rate
V. Net increase of cash and cash
1,646,237,689.70 -161,798,620.24
equivalents
120
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Add: Balance of cash and
cash equivalents at the period 1,654,499,494.28 2,390,446,316.58
-begin
VI. Balance of cash and cash
3,300,737,183.98 2,228,647,696.34
equivalents at the period -end
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
121
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
7. Statement of Changes in Owners’ Equity (Consolidated)
This Period
In RMB
This Period
Owners’ equity attributable to parent company
Other
equity instrument Prov
Item Less: Reaso ision Minority Total owners’
Perpet Other
Invent nable of
Share capital Pref ual Capital reserve comprehensi Surplus reserve Retained profit interests equity
erred Oth ory reserv gene
capital ve income
stoc er shares e ral
securiti risk
k
es
I. Balance at the end of 367,066,994.18 817,667,531.64
763,739,205.00 1,529,184,356.13 -2,280,500.61 36,290,904.66 3,511,668,491.00
the last year
Add: Changes of
accounting policy
Error
correction of the last
period
Enterprise
combine under the
same control
Other
II. Balance at the 367,066,994.18 817,667,531.64
763,739,205.00 1,529,184,356.13 -2,280,500.61 36,290,904.66 3,511,668,491.00
beginning of this year
III. Increase/ Decrease -99,958,601.84 1,814,457.07
64,168,349.01 27,307,610.50 -6,668,185.26
in this year (Decrease is
122
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
listed with ―-‖)
(i) Total -4,843,955.05 1,814,457.07
109,992,701.28 601,337.21 107,564,540.51
comprehensive income
(ii) Owners’ devoted -95,114,646.79
26,998,773.29 -68,115,873.50
and decreased capital
1.Common shares
23,020,579.65 23,020,579.65
invested by shareholders
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned into
owners equity with
share-based payment
4. Other -95,114,646.79 3,978,193.64 -91,136,453.15
(III) Profit distribution -45,824,352.27 -292,500.00 -46,116,852.27
1. Withdrawal of surplus
reserves
2. Withdrawal of general
risk provisions
3. Distribution for
-45,824,352.27 -292,500.00 -46,116,852.27
owners (or shareholders)
4. Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
123
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4. Other
(V) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end of
763,739,205.00 1,429,225,754.29 -466,043.54 367,066,994.18 881,835,880.65 63,598,515.16 3,505,000,305.74
the report period
Last Period
In RMB
Last Period
Owners’ equity attributable to the parent Company
Other
equity instrument Provi
Less:
Item Perpe Reaso sion Minority Total owners’
Inven Other
tual nable of interests equity
Share capital Preferr Capital reserve tory comprehensiv Surplus reserve Retained profit
capita Oth reserv gener
ed share e income
l er e al
stock s
securi risk
ties
I. Balance at the end of 1,466,959,939.03 -3,262,898.99 359,857,106.14
763,739,205.00 835,453,313.49 15,634,189.83 3,438,380,854.50
the last year
Add: Changes of
accounting policy
Error
124
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
correction of the last
period
Enterprise
combine under the
same control
Other
II. Balance at the 1,466,959,939.03 -3,262,898.99 359,857,106.14
763,739,205.00 835,453,313.49 15,634,189.83 3,438,380,854.50
beginning of this year
III. Increase/ Decrease
62,224,417.10
in this year (Decrease 982,398.38 7,209,888.04 -17,785,781.85 20,656,714.83 73,287,636.50
is listed with ―-‖)
(i) Total
982,398.38 27,104,897.12 -4,963,172.20 23,124,123.30
comprehensive income
(ii) Owners’ devoted 62,224,417.10
8,143,561.37 25,619,887.03 95,987,865.50
and decreased capital
1.Common shares
invested by 4,900,000.00 4,900,000.00
shareholders
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity with
share-based payment
62,224,417.10
4 Other 8,143,561.37 20,719,887.03 91,087,865.50
(III) Profit distribution 7,209,888.04 -53,034,240.34 - -45,824,352.30
1. Withdrawal of
7,209,888.04 -7,209,888.04 -
surplus reserves
2. Withdrawal of
125
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
general risk provisions
3. Distribution for
owners (or -45,824,352.30 - -45,824,352.30
shareholders)
4. Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4. Other
(V) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end
763,739,205.00 1,529,184,356.13 -2,280,500.61 367,066,994.18 817,667,531.64 36,290,904.66 3,511,668,491.00
of the report period
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
126
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
8. Statement of Changes in Owners’ Equity (Parent Company)
This Period
In RMB
This Period
Other
equity instrument
Item Perpetu Less: Other
Reasonable Total owners’
Share capital Preferr al Capital reserve Inventory comprehensiv Surplus reserve Retained profit
Oth reserve equity
ed capital shares e income
er
stock securiti
es
I. Balance at the end
763,739,205.00 1,497,987,446.59 366,848,828.50 786,501,710.90 3,415,077,190.99
of the last year
Add: Changes of
accounting policy
Error
correction of the last
period
Other
II. Balance at the
763,739,205.00 1,497,987,446.59 366,848,828.50 786,501,710.90 3,415,077,190.99
beginning of this year
III. Increase/ Decrease
in this year (Decrease -4,843,955.05 129,794,251.79 124,950,296.74
is listed with ―-‖)
(i) Total
comprehensive -4,843,955.05 175,618,604.06 170,774,649.01
income
(ii) Owners’ devoted
and decreased capital
127
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
1.Common shares
invested by
shareholders
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
4. Other
(III) Profit distribution -45,824,352.27 -45,824,352.27
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or -45,824,352.27 -45,824,352.27
shareholders)
3. Other
(IV) Carrying forward
internal owners’
equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Other
128
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
(V) Reasonable
reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end
763,739,205.00 1,493,143,491.54 366,848,828.50 916,295,962.69 3,540,027,487.73
of the report period
Last period
In RMB
Last period
Other
equity instrument
Item Perpetu Less: Other
Reasonable Total owners’
Share capital Preferr al Capital reserve Inventory comprehensiv Surplus reserve Retained profit
Oth reserve equity
ed capital shares e income
er
stock securiti
es
I. Balance at the end
763,739,205.00 1,497,987,059.46 359,638,940.46 767,437,070.86 3,388,802,275.78
of the last year
Add: Changes of
accounting policy
Error
correction of the last
period
Other
II. Balance at the
763,739,205.00 1,497,987,059.46 359,638,940.46 767,437,070.86 3,388,802,275.78
beginning of this year
III. Increase/ Decrease 387.13 7,209,888.04 19,064,640.04 26,274,915.21
129
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
in this year (Decrease
is listed with ―-‖)
(i) Total
comprehensive 72,098,880.38 72,098,880.38
income
(ii) Owners’ devoted
387.13 387.13
and decreased capital
1.Common shares
invested by
shareholders
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity
with share-based
payment
4. Other 387.13 387.13
(III) Profit distribution 7,209,888.04 -53,034,240.34 -45,824,352.30
1. Withdrawal of
7,209,888.04 -7,209,888.04
surplus reserves
2. Distribution for
owners (or -45,824,352.30 -45,824,352.30
shareholders)
3. Other
(IV) Carrying forward
internal owners’
equity
1. Capital reserves
conversed to capital
(share capital)
130
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4. Other
(V) Reasonable
reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end
763,739,205.00 1,497,987,446.59 366,848,828.50 786,501,710.90 3,415,077,190.99
of the report period
Legal Representative: Liu Tibin
Person in charge of accounting works: Zhang Xiaolong
Person in charge of accounting institute: Luo Bo
131
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
I. Company profile
Hefei Meiling Co., Ltd (hereinafter referred to as ―the Company‖) is an incorporated Company established
and reorganized by Hefei Meiling Refrigerator General Factory and approved on June 12th 1992 through
[WanTiGaiHanZi (1992) No.039] issued by original Mechanism Reform Committee of Anhui Province. On
August 30th 1993, through Anhui Provincial Government [Wanzhenmin (1993) No.166] and re-examination
of China Securities Regulatory Commission, the Company made first public issue for 30 million A shares
and the Company was listed on Oct. 18th, 1993 in Shenzhen Stock Exchange. On August 13th, 1996, the
Company was approved to issue 100 million B shares to investors abroad through [ZhengWeiFa(1996) No.26]
issued by China Securities Regulatory Commission. The Company went public in Shenzhen Stock Exchange
on 28 August 1996.
State-owned Assets Supervision & Administration Commission of the State Council approved such transfers
with Document Guozi Chanquan No.253 in 2007 Reply on Matters of Hefei Meiling Group Holdings
Company Limited Transferring Partial State-owned Ownership, Hefei Meiling Group Holdings Company
Limited (hereinafter abbreviated as Meiling Group) transferred its holding 37,852,683 shares in 82,852,683
state-owned shares of the Company to Sichuan Changhong Electronic Group Co., Ltd (hereinafter
abbreviated as Changhong Group), other 45,000,000 shares to Sichuan Changhong Electric Co. Ltd
(hereinafter abbreviated as Sichuan Changhong). On 15 August 2007, the above ownerships were transferred
and Cleaning Corporation Limited.
On 27 August 2007, State-owned Assets Supervision & Administration Commission of Anhui Provincial
Government replied with Document [WGZCQH(2007) No.309] Reply on ―Related Matters of Share Merger
Reform of Meiling Co., Ltd.‖, agreed the Company’s ownership split reform plan. The Company made
consideration that non-tradable share holders deliver 1.5 shares to A share holders per 10 shares, and original
Meiling Group made prepayment 3,360,329 shares for some non-tradable share holders as consideration for
split reform plan.
On 29 May 2008, concerning 34,359,384 state-owned shares (including 3,360,329 shares paid for other
non-tradable shareholders by original Meiling Group in share reform) held by original Meiling Group, the
―Notice of Freely Transfer of Meiling Electrics Equity held by Meiling Group‖[HGZCQ(2008) No. 59]
issued from State-owned Assets Supervision & Administration Commission of Hefei Municipal, agrees to
transfer the above said shares to Hefei Xingtai Holding Group Co., Ltd.(―Xingtai Holding Co.,‖) for free. On
7 August 2008, the ―Reply of Transfer Freely of Part of the Shares of Hefei Meiling Co., Ltd. held by
State-owned shareholders‖[GZCQ(2007) No. 750] issued by SASAC, agrees the above said transferring.
On 29 October 2008, Changhong Group Company signed Agreement on Equity Transfer of Hefei Meiling
Co., Ltd with Sichuan Changhong, in which 32,078,846 tradable A-shares with conditional subscription of
the Company (accounting for 7.76% in total shares) held by Changhong Group Company. On 23 December
132
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
2008, ―Reply of Transfer Freely of Part of the Shares of Hefei Meiling Co., Ltd. held by State-owned
shareholders‖[GZCQ(2008) No. 1412] issued by SASAC agrees the above said share transferring.
On 24 December 2010, being deliberated and approved in 32nd Meeting of 6th Session of the Board and 2nd
Extraordinary Shareholders’ General Meeting of 2010 as well as approval of document [ZJXP(2010) No.
1715] from CSRC, totally 116,731,500 RMB ordinary shares (A stock) were offering privately to target
investors with issue price of RMB 10.28/share. Capital collecting amounting to RMB 1,199,999,820 after
issuing expenses RMB 22,045,500 deducted, net capital collected amounting to RMB 1,177,954,320, and
paid-in capital(share capital) increased RMB 116,731,500 with capital reserve(share premium) RMB
1,061,106,088.5 increased. The increasing capital has been verified by Capital Verification Report No.:
［XYZH2010CDA6021］issued from Shinwing CPA Co., Ltd.
On 20 June 2011, the general meeting of the Company considered and approved the 2010 profit distribution
plan, namely to distribute cash dividends of RMB0.5 (tax included) plus two shares for every ten shares held
by shareholders to all shareholders, based on the total share capital of 530,374,449 shares as of 31 December
2010. The total share capital of the Company upon profit distribution increased to 636,449,338 shares. The
capital increase was verified by Anhui Huashen Zhengda Accounting Firm with the verification report
WHSZDKYZ(2011)No.141.
On 26 June 2012, the general meeting of the Company considered and approved the 2011 profit distribution
and capitalization of capital reserve plan, namely to distribute cash dividends of RMB0.5 (tax included) plus
two shares for every ten shares to all shareholders capitalized from capital reserve, based on the total share
capital of 636,449,338 shares as of 31 December 2011. The total share capital of the Company upon
implementation of capitalization of capital reserve increased to 763,739,205 shares from 636,449,338 shares,
and was verified by Anhui Anlian Xinda Accounting Firm with the verification report
WALXDYZ(2012)No.093.
Ended as 30 June 2016, total share capital of the Company amounting to 763,739,205shares with ordinary
shares in full. Among which, 600,875,205 shares of A-share accounting 78.68% in total shares while B-share
with 162,864,000 shares accounting 21.32% in total shares. Detail share capital as:
Type of stock Quantity Proportion
(I)Restricted shares 9,443,070.00 1.24%
1. State-owned shares - -
2. State-owned legal person’s shares 915,987.00 0.12%
3. Other domestic shares 7,527,234.00 0.99%
Including: Domestic legal person’s shares 4,839,035.00 0.63%
Domestic natural person’s shares 2,688,199.00 0.36%
4. Foreign shares 999,849.00 0.13%
133
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(II)Unrestricted shares 754,296,135.00 98.76%
1. RMB Ordinary shares 592,431,984.00 77.57%
2. Domestically listed foreign shares 161,864,151.00 21.19%
3. Overseas listed foreign shares - -
4. Others - -
Total shares 763,739,205.00 100.00%
The Company belongs to the manufacture of light industry, and engaged in the production and sale of
refrigerator, freezer and air-conditioner. Unified social credit code of the Company: 9134000014918555XK;
Address: No.2163, Lianhua Road, Economy and Technology Development Zone, Hefei City; Legal
Representative: Liu Tibin; register capital(paid-in capital): RMB 763,739,205; type of company: limited
liability company(joint venture and listed of Taiwan, Hong Kong and Macau) Business Scope: Manufacture
of cooling apparatus, air-conditioner, washing machine, injection plastic machine of computer controlling,
computer heater, plastic products, packaging products and decorations, business of self-produced products,
technology export and import&export of the raw&auxilary materials, machinery equipment, instrument and
technology; department sales and transportation.
II. Scope of consolidated financial statement
The Company’s consolidated financial statement included 49 subsidiaries including but not limited to
Sichuan Changhong Air Conditioner CO., Ltd, Zhongshan Changhong Home Appliances Company Limited
and Zhongke Meiling Low Temperature Technology Co., Ltd, etc. As compared to previous year, Subsidiary
Changmei Technology Co. Ltd. was newly included due to direct investment in this year; Subsidiary
Guangdong Changhong Ridian Technology Co., Ltd. Was newly included due to corporate merger under the
same control.
More detail can be seen in ―VII. Changes of consolidated scope‖ and ―VIII. Rights and interest in other
subjects‖ in the Note.
III. Basis for preparation of financial statement
1. Basis for preparation
The financial statements of the Company were prepared in accordance with the actual transactions and
proceedings, and relevant regulation of Accounting Standards for Enterprise released by the Ministry of
Finance, and was on the basis of sustainable operation, and the accounting policy and estimation stated in the
―IV. Significant Accounting Policy and Accounting Estimation‖.
2. Continuous operation
The Company recently has a history of profitability operation and has financial resouces supporting, and
prepared the financial statement on basis of going concern is reasonable.
IV. Significant Accounting Policy, Accounting Estimation
134
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
1. Statement on observation of accounting standards for enterprise
The financial statement prepared by the Company applies with the requirements of Accounting Standard for
Enterprise, and reflects the financial condition, operational achievements and cash flow of the Company
effectively and completely.
2. Accounting period
The accounting period of the Company is the calendar date from 1 January to 31 December.
3. Standard currency for accounting
The Company takes RMB as the standard currency for accounting.
4. Accountant arrangement method of business combination under common control and not under common
control
As acquirer, the Company measures the assets and liabilities acquired through business combination under
common control at their carrying values as reflected in the consolidated financial statement of the ultimate
controller as of the combination date. Capital reserve shall be adjusted in respect of any difference between
carrying value of the net assets acquired and carrying value of the combination consideration paid. In case
that capital reserve is insufficient to offset, the Company would adjust retained earnings.
The acquiree’s net identifiable assets, liabilities or contingent liabilities acquired through business
combination not under common control shall be measured at fair value as of the acquisition date. The cost of
combination represents the fair value of the cash or non-cash assets paid, liabilities issued or committed and
equity securities issued by the Company as at the date of combination in consideration for acquiring the
controlling power in the acquiree, together with the sum of any directly related expenses occurred during
business combination(in case of such business combination as gradually realized through various
transactions, the combination cost refers to the sum of each cost of respective separate transaction). Where
the cost of the combination exceeds the acquirer’s interest in the fair value of the acquirer’s identifiable net
assets acquired, the difference is recognized as goodwill; where the cost of combination is lower than the
acquirer’s interest in the fair value of the acquiree’s identifiable net assets, the Company shall firstly make
further review on the fair values of the net identifiable assets, liabilities or contingent liabilities acquired as
well as the fair value of the non-cash assets portion of combination consideration or the equity securities
issued by the Company. In case that the Company finds the cost of combination is still lower than the
acquirer’s interest in the fair value of the acquiree’s identifiable net assets after such further review, the
difference is recognized in non-operating income for the current period when combination occurs.
5. Measures on Preparation of Consolidated Financial Statements
The Company shall put all the subsidiaries controlled and main body structured into consolidated financial
statements.
Any difference arising from the inconformity of accounting year or accounting policies between the
subsidiaries and the Company shall be adjusted in the consolidated financial statements.
All the material inter-company transactions, non-extraordinary items and unrealized profit within the
combination scope are written-off when preparing consolidated financial statement. Owners’ equity of
subsidiary not attributable to parent company and current net gains and losses, other comprehensive income
135
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
and total comprehensive income attributable to minority shareholders are recognized as non-controlling
interests, minority interests, other comprehensive income attributable to minority shareholders and total
comprehensive income attributable to minority shareholders in consolidated financial statement respectively.
As for subsidiary acquired through business combination under common control, its operating results and
cash flow will be included in consolidated financial statement since the beginning of the period when
combination occurs. When preparing comparative consolidated financial statement, the relevant items in
previous year’s financial statement shall be adjusted as if the reporting entity formed upon combination has
been existing since the ultimate controller commenced relevant control.
As for equity interests of the investee under common control acquired through various transactions which
eventually formed business combination, the Company shall supplement disclosure of the accounting
treatment in consolidated financial statement in the reporting period when controlling power is obtained. For
example, as for equity interests of the investee under common control acquired through various transactions
which eventually formed business combination, adjustments shall be made as if the current status had been
existing when the ultimate controller commenced control in connection of preparing consolidated financial
statement; in connection with preparing comparative statement, the Company shall consolidate the relevant
assets and liabilities of the acquiree into the Company’s comparative consolidated financial statement to the
extent not earlier than the timing when the Company and the acquiree are all under control of the ultimate
controller, and the net assets increased due to combination shall be used to adjust relevant items under
owners’ equity in comparative statement. In order to prevent double computation of the value of the
acquiree’s net assets, the relevant profits and losses, other comprehensive income and change of other net
assets recognized during the period from the date when the Company acquires original equity interests and
the date when the Company and the acquiree are all under ultimate control of the same party (whichever is
later) to the date of combination in respect of the long-term equity investment held by the Company before
satisfaction of combination shall be utilized to offset the beginning retained earnings and current gains and
losses in the period as the comparative financial statement involves, respectively.
As for subsidiary acquired through business combination not under common control, its operating results and
cash flow will be included in consolidated financial statement since the Company obtains controlling power.
When preparing consolidated financial statement, the Company shall adjust the subsidiary’s financial
statement based on the fair value of the various identifiable assets, liabilities or contingent liabilities
recognized as of the acquisition date.
As for equity interests of the investee not under common control acquired through various transactions which
eventually formed business combination, the Company shall supplement disclosure of the accounting
treatment in consolidated financial statement in the reporting period when controlling power is obtained. For
example, as for equity interests of the investee not under common control acquired through various
transactions which eventually formed business combination, when preparing consolidated financial statement,
the Company would re-measure the equity interests held in the acquiree before acquisition date at their fair
value as of the acquisition date, and any difference between the fair value and carrying value is included in
current investment income. in case that the equity interests in acquiree held by the Company before the
relevant acquisition date involves other comprehensive income at equity method and change of other owners’
136
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
equity (other than net gains and losses, other comprehensive income and profit distribution), then the equity
interests would transfer to investment gains and losses for the period which the acquisition date falls upon.
The other comprehensive income arising from change of the net liabilities or net assets under established
benefit scheme as acquiree’s re-measured such scheme is excluded.
The transaction with non-controlling interest to dispose long-term equity investment in a subsidiary without
losing control rights over the subsidiary, the difference between the proceeds from disposal of interests and
the decrease of the shared net assets of the subsidiary is adjusted to capital premium (share premium). In case
capital reserve is not sufficient to offset the difference, retained earnings will be adjusted.
As for disposal of part equity investment which leads to losing control over the investee, the Company would
re-measure the remaining equity interests at their fair value as of the date when the Company loses control
over the investee when preparing consolidated financial statement. The sum of consideration received from
disposal of equity interest and fair value of the remaining equity interest, less the net assets of the original
subsidiary attributable to the Company calculated based on the original shareholding proportion since the
acquisition date or the date then consolidation commences, is included in investment gains and losses for the
period when control is lost, meanwhile to offset goodwill. Other comprehensive income related to equity
interest investment in original subsidiaries is transferred into current investment gains and losses upon lost of
control.
If the disposal of the equity investment of a subsidiary is realized through multiple transactions until loss of
control and is a package deal, the accounting treatment of these transactions should be dealt with as one
transaction of disposal of the subsidiary until loss of control. However, before the Company loses total
control of the subsidiary, the differences between the actual disposal price and the share of the net assets of
the subsidiary disposed of in every transaction should be recognized as other comprehensive income in the
consolidated financial statements, and transferred to profit or loss when losing control.
6. Accounting treatment for joint venture arrangement and joint controlled entity
The joint venture arrangement of the Company consists of joint controlled entity and joint venture. As for
jointly controlled entity, the Company determines the assets held and liabilities assumed separately as a party
to the jointly controlled entity, recognizes such assets and liabilities according to its proportion, and
recognizes relevant income and expense separately under relevant agreement or according to its proportion.
As for asset transaction relating to purchase and sales with the jointly controlled entity which does not
constitute business activity, part of the gains and losses arising from such transaction attributable to other
participators of the jointly controlled entity is only recognized.
7. Cash and cash equivalents
Cash in the cash flow statement comprises the Group’s cash on hand and deposits that can be readily
withdrawn on demand. Cash equivalents are short-term, highly liquid investments held by the Group, that are
readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in
value, including but not limited to the followings which meet the aforesaid conditions: debt investment
matured within three months upon the acquisition date, bank time deposit which can be early withdrew by
serving a notice and transferrable deposit receipt, etc. for time deposit which can not be used for payment at
137
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
any time, it would be note recognized as cash; while if can be used for such purpose, it would be recognized
as cash. Guarantee deposit over three months in other monetary capital shall not be recognized as cash
equivalents.
8. Foreign currency business and foreign currency financial statement conversion
(1) Foreign currency business
As for the foreign currency business, the Company converts the foreign currency amount into RMB amount
pursuant to the spot exchange rate as of the business day. As at the balance sheet date, monetary items
expressed by foreign currency are converted into RMB pursuant to the spot exchange rate as of the balance
sheet date. The conversion difference occurred is recorded into prevailing gains and losses, other than the
disclosure which is made according to capitalization rules for the exchange difference occurred from the
special foreign currency borrowings borrowed for constructing and producing the assets satisfying condition
of capitalization. As for the foreign currency non-monetary items measured by fair value, the amount is then
converted into RMB according to the spot exchange rate as of the confirmation day for fair value. And the
conversion difference occurred during the procedure is recorded into prevailing gains and losses directly as
change of fair value. As for the foreign currency non-monetary items measured by historical cost, conversion
is made with the spot exchange rate as of the business day, with no change in RMB amount.
(2) Conversion of foreign currency financial statement
Spot exchange rate as of the balance sheet date is adopted for conversion of assets and liabilities in foreign
currency balance sheet; as for the items in statement of owners’ equity except for ―Undistributed profit‖,
conversion is made pursuant to the spot exchange rate of business day; income and expense items in income
statement then are also converted pursuant to the spot exchange rate of transaction day. Difference arising
from the aforementioned conversions shall be listed separately in items of owners’ equity. Spot exchange rate
as of the occurrence date of cash flow is adopted for conversion of foreign currency cash flow. The amount
of cash affected by exchange rate movement shall be listed separately in cash flow statement.
9. Financial assets and financial liabilities
(1) Financial assets
1) Classification of financial assets
In consideration of investment targets and economic essence, the Company groups the financial assets owned
by it as four categories, namely financial assets measured by fair value and whose movement is recorded into
prevailing gains and losses, held-to-maturity investment, loans and accounts receivables, as well as financial
assets available-for-sale.
Financial assets measured by fair value and whose movement is recorded into prevailing gains and losses
represent the financial assets which are held mainly for disposal in a short time and listed as tradable
financial assets in the balance sheet.
Held-to-maturity investment represents the non-derivative financial assets which has fixed maturity day,
fixed or available-for-confirmation recovered amount and for which the management has definite intention
and ability to hold till maturity.
Loans and accounts receivables represent the non-derivative financial assets which have no quotation in an
138
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
active market and fixed or available-for-confirmation recovered amount.
Financial assets available-for-sale including the non-derivative financial assets available-for-sale and the
financial assets which have not been grouped as others at the initial confirmation
2) Recognition and measurement for financial assts
Financial assets, while become party of the contract of financial instrument in the Company, recognized in
balance sheet by fair value. For the financial assets which are measured by fair value and whose fair value
change is recorded into prevailing gains and losses, the relevant transaction expense arising from acquisition
is recorded into prevailing gains and losses directly, while the relevant transaction expense of other financial
assets is recorded into initial recognition amount.
Financial assets which are measured by fair value and whose fair value change is recorded into prevailing
gains and losses, together with financial assets available-for-sale, would have follow-up measurement
according to fair value; effective interest method is adopted for loans and accounts receivables and
held-to-maturity investment which are shown in amortized cost.
Fair value change of financial assets which are measured by fair value and whose fair value change is
recorded into prevailing gains and losses is recorded into gains and losses of fair value change; interests or
cash dividend acquired from holding assets are recognized as investment income; when disposing such assets,
the difference between their fair value and initial accounting amount is recognized as investment gains and
losses. Meanwhile, gains and losses of fair value shall be adjusted.
Except impairment losses and exchange gains/loss from financial assets with foreign currency, variation of
the fair value for financial assets available for sale should reckon into shareholders’ equity. The variation
of fair value accumulative reckon into equity previously should transfer into current gains/losses while
recognition of this financial asset terminated. For the interest during period of holding for instrument
investment of liability available for sale based on real interest rate, and cash dividend related with instrument
investment of equity available for sale that announced by invested enterprises should reckon into current
gains/losses as investment incomes.
3) Impairment of financial assets
Except for the financial assets which are measured by fair value and whose fair value change is recorded into
prevailing gains and losses, the Company will make check in the carrying value of other financial assets as at
the balance sheet date. If there is objective evidence proving impairment of certain financial assets, the
Company then makes provision for impairment.
When the financial assets calculated by amortized cost decrease in value, count and draw the provision for
impairment according to the balance between present value and book value of predicted future cash flows
(Excluding future credit losses that haven’t occurred yet.). If there is any objective evidence to indicate that
the financial assets has recovered and is objectively connected with matters occurred after confirming the
losses, the formerly confirmed impairment losses will be reversed and reckoned in current profits and losses.
When the fair value of financial assets available for sale goes down substantially or non- transiently, the
accumulating losses previously and directly reckoned in shareholder's equity and formed due to shrinkage of
fair value will be transferred and reckoned in impairment losses. As for the debt instrument investment
available for sale with confirmed impairment losses, if its fair value rises after and it is objectively connected
139
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
with matters occurred after confirming the primary impairment losses, the formerly confirmed impairment
losses will be reversed and reckoned in current profits and losses. And the debt instrument investment
available for sale with confirmed impairment losses shall be directly reckoned in stockholder's equity if its
fair value rises after.
4) Transfer of financial assets
The financial assets meet one of following requirements will be terminated recognition: ① The contract
rights of collecting cash flow of the financial assets is terminated; ②The financial assets has already been
transferred, and the Company has transferred almost all risks and remunerations of financial assets ownership
to the transferee; ③The financial assets has been transferred, even though the Company has neither
transferred nor kept almost all risks and remunerations of financial assets ownership, the Company has given
up controlling the financial assets.
If the enterprise has neither transferred or kept almost all risks and remunerations of financial assets
ownership, nor given up controlling the financial assets, then confirm the relevant financial assets according
to how it continues to involve into the transferred financial assets and confirm the relevant liabilities
accordingly. The degree of keeping involving into the transferred financial assets refers to the risk level with
which the fluctuation of this financial asset value makes the enterprise face.
If the entire transfer of financial assets satisfies the demand for derecognition, reckon the balance between
the book value of the transferred financial assets and the sum of consideration received from transfer and
fluctuation accumulated amount of fair value formerly reckoned in other consolidated income in the current
profits and losses.
If part transfer of financial assets satisfies the demand for derecognition, apportion the integral book value of
the transferred financial assets between the derecognized parts and the parts not yet derecognized according
to each relative fair value, and reckon the balance between the sum of consideration received from transfer
and fluctuation accumulated amount of fair value formerly reckoned in other consolidated income that
should be apportioned to the derecognized parts and the apportioned aforementioned carrying amounts in the
current profits and losses.
(2) Financial liabilities
When making the initial recognition for financial liabilities, the Company classifies the financial liabilities
into ones which are measured by fair value and whose change is recorded into prevailing gains and losses,
and other financial liabilities.
Financial liabilities which are measured by fair value and whose change is recorded into prevailing gains and
losses include tradable financial liabilities and financial liabilities which are measured by fair value and
whose change is recorded into prevailing gains and losses at the initial recognition day. Follow-up
measurements are made by fair value. Recorded into prevailing gains and losses are the gains or losses
formed through fair value change and dividend and interest expenditure regarding to the financial liabilities.
As for other financial liabilities, effective interest rate method is adopted and follow-up measurement is
made according to amortized cost.
1) Method for recognition of fair value of financial assets and liabilities
140
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
For those financial instruments existing in active markets, market quotation in the active market is used to
confirm their fair values. In active market, the Company takes the present bid price of already-held financial
assets or plan-to-undertake financial liabilities as the fair values of relevant assets and liabilities; the
Company takes the present offer price of plan-to-buy financial assets and –already-undertaken liabilities as
the fair values of relevant assets and liabilities. In the situation that there are no present bid and offer price
for financial assets and liabilities, while there is no material change in economic environment after the latest
business day, then fair value of the financial assets and liabilities is to confirm pursuant to the latest business
market quotation.
Fair value of the financial instruments which have no active market is confirmed by adoption of estimation
technology. Estimation technology includes reference to the price applied by parties which know well
situation and are willing to make deals in the latest market business, reference to the current fair value of
other financial assets which are the same in principle, reference to discounted cash flow method and option
pricing model.
10. Bad debt provision for accounts receivable
Allowance method is adopted for the bad debt losses which are likely to happen. And conducting impairment
test independently or by combination at period-end, withdrawn bad debt provision and then recorded into
current gains and losses. As for the accounts receivable which are not able to call back through definite
evidence, they shall be treated as bad debt losses after approval of the Group according to regulated
procedures to offset withdrawn bad debt provision.
The following situation as standards for confirmation of bad debt losses of accounts receivable: revoke,
bankruptcy, insolvency, serious insufficiency of cash flow of its debit units, or the debit units have to stop
production due to serious natural disaster and are not able to settle the debts or in predicted time, or other
definite evidence showing that the debt is not available to call back or the possibility of calling back is tiny.
Account receivables were divided as follow categories at period-end, which was performed impairment test
in way of individual or group, and withdrawal bad debt provision:
(1) Account receivable with single significant amount:
If totally amount takes over 80% of the total for over 5% occupied, than 5% of single amount
Determine basis or amount
in total amounts recognized as single significant amount; if totally amount takes less than
standards for single
80% of the total for over 5% occupied, than lower recognition standards till qualified 80% in
significant amount
total
Method of bad debt
provision accrual for account Withdrawal bad debt provision according to difference between the current value of future
receivable with single major cash flow and book values; if there has no impairment been found in individual test,
amount withdrawal bad debt provision while testing by group
(2) Account receivable withdrawal bad debt provision based on combination:
Basis for combination recognized
Combination 1 Account receivable except combination 2
141
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Basis for combination recognized
Employee reserve fund, foreign investment amount, contact with related party in consolidated statement
Combination 2 of Changhong Group, export tax refund receivable, account receivable with L/C or insurance,
government subsidy etc.
Methods on withdrawal of bad debt provision based on combination
Combination 1 Withdrawal bad debt provision by proportion in different age group
Combination 2 Risks are under control without bad debt provision accrual
In combination 1, withdrawal proportion of bad debt provision for account receivable based on age analysis:
Withdrawal proportion of account receivable Withdrawal proportion of other account
Age
(%) receivable (%)
Within 1year(1year
5 5
included )
1－2years 15 15
2－3 years 35 35
3－4 years 55 55
4－5 years 85 85
Over 5 years 100 100
(3) Account receivable with single minor amount but withdrawal single item bad debt provision:
Reasons for withdrawal single
Account with minor amount but have significant inflow risk on predicted future cash flow
item bad debt provision
Withdrawal method for bad Impairment test on the current value of predicted future cash flow, bad debt provision
debt provision withdrawal.
11. Inventories
Inventories of the Company principally include raw materials, stock goods; work in process, self-made
semi-finished product, materials consigned to precede, low-value consumption goods, goods in transit, goods
in process and mould etc.
Perpetual inventory system is applicable to inventories. For daily calculation, standard price is adopted for
raw materials, low-value consumption goods and stock goods. Switch-back cost of the current month is
adjusted by distribution price difference at the end of the month, the dispatched goods will share the cost
differences of inventory while in settlement the business income; and low-value consumption goods is
carried forward at once when being applied for use; the mould expenses will evenly deferred share based on
balance at period-begin plus increase amount in this period divided by 12 months.
Inventory at period-end is valued by the Lower-of-value between the cost and net realizable value. For those
individual stock, suffering damage, totally or partly out of fashion or has lower sales price than cost,
predicted recoverable parts in cost, and withdrawal provision of inventory depreciation single. For those raw
materials, stock commodities and goods in transit, withdrawal provision of inventory depreciation by follow
142
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
methods:
(1) Determined the net realizable value of raw materials on the higher amount between the final prices of
estimated sale-price deducted cost (about to happen till products finished), estimated sales expense and
relevant taxes, and the fair value of external disposal.
(2) Withdrawal obsolete provision for commodity stocks and goods in transit by the follow proportion:
1) Refrigerator, freezer and washing machine
Withdrawal proportion for obsolete
Grade Stock duration
provision
Within 3 months 0%
4-6 months 5%
7-12 months 15%
Grade-A
1-2 years 25%
2-3 years 40%
Over 3 years 100%
Qualified 40%
Grade-B 50%
Grade-C 60%
Unqualified 60%
Disposal 65%
Sample machine 30%
Special user type that exceed the order quantity 50%
2) Air-conditioner
Withdrawal proportion for obsolete
Location level
provision
Repair 50%
Awaiting repair 70%
Store return 70%
De-stocking 70%
Overstock 100%
With respect to the inventories and delivered goods which are not vested to the above classification, their
realizable net value will be calculated by the Company based on the estimated selling price of the inventories
less estimated selling expense and related taxes. The Company re-checks the above mentioned proportion at
every end of the year. Calculated the net realizable value by difference between the estimated sale price less
the estimated sales expense and relevant taxation; after comparison with the book value of commodity stocks
and goods in transit, determined whether adjusted the proportion or not. Mould expense will amortize in
installment in usual times. Once the use-life of mould is terminated, and than transfer its remaining cost into
143
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
gains/losses, no withdrawal of obsolete provision at period-end.
12. Long-term equity investment
Long-term equity investment of the Company is mainly about investment in subsidiary, investment in
associates and investment in joint-ventures.
For long-term equity investments acquired through business combination under common control, the initial
investment cost shall be the acquirer’s share of the carrying amount of net assets of the acquiree as of the
combination date as reflected in the consolidated financial statement of the ultimate controller. If the carrying
amount of net assets of the acquiree as of the combination date is negative, the investment cost of long-term
equity investment shall be zero. For long-term equity investment acquired through business combination not
under common control, the initial investment cost shall be the combination cost.
Excluding the long-term equity investment acquired through business combination, there is also a king of
long-term equity investment acquired through cash payment, for which the actual payment for the purchase
shall be investment cost; If Long-term equity investments are acquired by issuing equity securities, fair value
of issuing equity investment shall be investment cost; for Long-term equity investments which are invested
by investors, the agreed price in investment contract or agreement shall be investment cost; and for long-term
equity investment which is acquired through debt reorganization and non-monetary assets exchange,
regulations of relevant accounting standards shall be referred to for confirming investment cost.
The Company adopts cost method for investment in subsidiaries, makes calculation for investments in
joint-ventures and associates by equity method.
When calculated by cost method, long-term equity investment is priced according to its investment cost, and
cost of the investment is adjusted when making additional investment or writing off investment; When
calculated by equity method, current investment gains and losses represent the proportion of the net gains
and losses realized by the invested unit in current year attributable to or undertaken by the investor. When the
Company is believed to enjoy proportion of net gains and losses of invested unit, gains and losses
attributable to the Company according to its shareholding ratio is to computer out according to the
accounting policy and accounting period of the Company, on the basis of the fair value of various
recognizable assets of the invested unit as at the date of obtaining of the investment, after offset of gains and
losses arising from internal transactions with associates and joint-ventures, and finally to make confirmation
after adjustment of net profit of the invested unit. Confirmation on gains and losses from the long-term
equity investment in associates and joint-ventures held by the Company prior to the first execution day, could
only stand up with the precedent condition that debit balance of equity investment straightly amortized
according to its original remaining term has already been deducted, if the aforementioned balance relating to
the investment do exist.
In case that investor loses joint control or significant influence over investee due to disposal of part equity
interest investment, the remaining equity interest shall be calculated according to Enterprise Accounting
Principles No.22-Recognition and Measurement of Financial Instrument. Difference between the fair value
of the remaining equity interest as of the date when lose of joint control or significant influence and the
carrying value is included in current gains and losses. Other comprehensive income recognized in respect of
144
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
the original equity interest investment under equity method should be treated according to the same basis
which the investee adopts to directly dispose the relevant assets or liabilities when ceasing adoption of equity
method calculation; and also switches to cost method for calculating the long-term equity investments which
entitles the Company to have conduct control over the invested units due to its additional investments; and
switches to equity method for calculating the long-term equity investments which entitles the Company to
conduct common control or significant influence, while no control over the invested units due to its
additional investments, or the long-term equity investments which entitles the Company with no control over
the invested units any longer while with common control or significant influence.
When disposing long-term equity investment, the balance between its carrying value and effective price for
obtaining shall be recorded into current investment income. When disposing long-term equity investment
which is calculated by equity method, the proportion originally recorded in owners’ equity shall be
transferred to current investment income according to relevant ratio, except for that other movements of
owners’ equity excluding net gains and losses of the invested units shall be recorded into owners’ equity.
13. Investment real estate
The investment real estate of the Company includes leased houses and buildings, and is accounted value by
its cost. Cost of purchased-in investment real estate consists of payment for purchase, relevant taxes and
other expenditure which is attributable to the assets directly; while cost of self-built investment real estate is
formed with all necessary expenditures occurred before construction completion of the assets arriving at the
estimated utilization state.
Consequent measurement of investment estate shall be measured by cost method. Depreciation is provided
with average service life method pursuant to the predicted service life and net rate of salvage value. The
predicted service life and net rate of salvage value and annual depreciation are listed as follows:
Predicted rate of salvage Depreciation rate per
Type Depreciation term
value annum
Houses and buildings 30-40 years 4%-5% 2.375%-3.20%
When investment real estate turns to be used by holders, it shall switch to fixed assets or intangible assets
commencing from the date of such turning. And when self-used real estate turns to be leased out for rental or
additional capital, the fixed assets or intangible assets shall switch to investment real estate commencing
from the date of such turning. In situation of switch, the carrying value before the switch shall be deemed as
the credit value after the switch.
When investment is disposed, or out of utilization forever and no economic benefit would be predicted to
obtain through the disposal, the Company shall terminate recognition of such investment real estate. The
amount of income from disposal, transfer, discarding as scrap or damage of investment real estate after
deducting the asset’ s carrying value and relevant taxation shall be written into current gains and losses.
14. Fixed assets
Fixed assets of the Company represent the tangible assets and assets package: held by the Company for
purpose of producing commodities, providing labor service, leasing or operational management, service life
145
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
exceeds one year, and unit price exceeds RMB 2,000. Including four categories of houses and buildings,
machinery equipments, transportation equipments and other equipments
Their credit value is determined on the basis of the cost taken for obtaining them. Of which, cost of
purchased-in fixed assets include bidding price and import duty and relevant taxes, and other expenditure
which occurs before the fixed assets arrive at the state of predicted utilization and which could be directly
attributable to the assets; while cost of self-built fixed asset is formed with all necessary expenditures
occurred before construction completion of the assets arriving at the estimated utilization state; credit value
of the fixed assets injected by investors is determined based on the agreed value of investment contracts or
agreements, while as for the agreed value of investment contracts or agreements which is not fair, it shall
take its fair value as credit value; and for fixed assets which are leased in through finance leasing, credit
value is the lower of fair value of leased assets and present value of minimized leasing payment as at the
commencing date of leasing.
Consequent expenditure related to fixed assets consists of expenditures for repair and update reform. For
those meeting requirements for recognization of fixed assets, they would be accounted as fixed asset cost;
and for the part which is replaced, recognization of its carrying value shall cease; for those not meeting
requirements for recognization of fixed assets, they shall be accounted in current gains and losses as long as
they occur. When fixed asset is disposed, or no economic benefit would be predicted to obtain through
utilization or disposal of the asset, the Company shall terminate recognization of such fixed asset. The
amount of income from disposal, transfer, discarding as scrap or damage of fixed asset after deducting the
asset’ s carrying value and relevant taxation shall be written into current gains and losses.
The Company withdraws depreciation for all fixed assets except for those which have been fully depreciated
while continuing to use. It adopts average service life method for withdrawing depreciation which is treated
respectively as cost or current expense of relevant assets according to purpose of use. The depreciation term,
predicted rate of salvage value and depreciation rate applied to fixed assets of the Company are as follows:
Predicted rate of salvage Depreciation rate per
No. Type Depreciation term
value annum
1 Houses and buildings 30-40 years 4%-5% 2.375%-3.20%
2 Machinery equipments 10-14 years 4%-5% 6.786%-9.60%
3 Transport equipment 5-12 years 4%-5% 7.92%-19.20%
4 Other equipments 8-12 years 4%-5% 7.92%-12.00%
The Company makes re-examination on predicted service life, predicted rate of salvage value and
depreciation method at each year-end. Any change will be treated as accounting estimation change.
15. Construction in process
Construction in process is measured with effective cost. Self-operated constructions projects are measured
with direct materials, direct salaries and direct construction expense; construction projects undertaken by
external are measured with the engineering payment payable; and engineering cost (income abatement) of
equipment-installation projects is confirmed with consideration of value of the equipments, installation fee,
146
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
and expenditure arising from trial operation of the projects. Borrowing expense and exchange gains and
losses which should be capitalized are also included in cost of construction in process.
16. Borrowing expense
Borrowing expenses include interest expense, amortization of discount or premium, auxiliary expenses and
exchange difference due to borrowing in foreign currency. The borrowing expense which could be directly
attributable to purchase or production of assets satisfying capitalization condition, starts capitalization when
capital expenditure and borrowing expense occur and when necessary purchase or production conducted for
promoting assets to reach the predicted available-for-use or available-for-sale state; and capitalization shall
cease when purchased or produced assets satisfying capitalization condition have reached the predicted
available-for-use or available-for-sale state. Other borrowing expense is recognized as expense during the
occurrence period.
Capitalization shall be exercised for interest expense actually occurred from special borrowings in current
period after deduction of the interest income arising from unutilized borrowing capital which is saved in
banks or deduction of investment income obtained from temporary investment; For recognization of
capitalized amount of common borrowing, it equals to the weighted average of the assets whose
accumulated expense or capital disburse is more than common borrowing times capitalization rate of
occupied common borrowing. Capitalization rate is determined according to weighted average interest rate of
common borrowing.
Assets satisfying capitalization principle generally refer to fixed assets, investment real estate and inventories
which can only arrive at predicted available-for-use and available-for-sale state after quite a long time
(generally over one year) in purchase or production activities.
If abnormal interruption happens during purchase or production of assets satisfying capitalization principle
and the interruption lasts over 3 months, the capitalization for the borrowing expense shall pause until the
purchase or production restarts.
17. Intangible assets
The Company holds intangible assets including land use right, trademark, patent technology and non-patent
technology. Intangible assets are measured according to the effective costs paid for obtaining the assets. For
those intangible assets purchased in by the Company, their effective cost consist of actual payment and
relevant other expenditure; for the intangible assets input by investors, effective cost is determined according
to the value agreed in investment contracts and agreements, while if the agreed value is not fair, then
effective value is confirmed according to fair value.
Land use right is averagely amortized according to its transfer term commencing from the sate of transfer;
trademark use-rights averagely amortized by 10 years; patent technology, non-patent technology and other
intangible assets is averagely amortized according to the shortest of their predicted service life, beneficial
term concluded by contract and effective term regulated by laws. Amortization amount is recorded in assets
cost and current gains and losses relevant to beneficial objectives.
Re-examination on predicted service life and amortization method of the intangible assets which have limited
service life shall be conducted at the end of each year. If changed, it would be treated as change of
147
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
accounting estimation. Re-examination on predicted service life of intangible assets which have uncertain
service life shall be conducted. For any evidence proving that service life of intangible assets is limited, then
the service life shall be estimated and the Company shall make amortization within the predicted service life
period.
18. Research and development
As for expenditure for research and development, the Company classifies it into expenditure on research
phase and development phase, based on nature of the expenditure and that whether the final intangible assets
formed by research & development is of great uncertainty. Expenditure arising during research should be
recorded in current gains and losses upon occurrence; expenditure arising during development is confirmed
as intangible assets when satisfying the following conditions:
(1) Completions of the intangible assets make it available for application or sell in technology;
(2) Equipped with plan to complete the intangible asset and apply or sell it;
(3) There is market for products produced with this intangible assets or the intangible asset itself;
(4) Have sufficient technology, financial resource and other resources to support development of the
intangible assets, and have ability to apply or sell the assets;
(5) Expenditure attributable to development of the intangible assets could be reliable measured.
Expenditure arising during development not satisfying the above conditions shall be recorded in current
gains and losses upon occurrence. Development expenditure which had been recorded in gains and losses in
previous period would not be recognized as assets in later period. Expenditure arising during development
phase which has been starting capitalization is listed in balance sheet as development expenditure, and
transferred to intangible assets since the project reaches at predicted utilization state.
19. Impairment of non-financial long-term assets
As at each balance sheet date, the Company has inspection on long-term equity investment, fixed assets,
construction in process and intangible assets with limited service life. When the following indications appear,
assets may be impaired, and the Company would have impairment test. As for goodwill and intangible assets
which have uncertain service life, no matter there is impairment or not, impairment test shall be conducted at
the end of every year. If it is hard to make test on recoverable amount of single asset, test is expected to make
on the basis of the assets group or assets group portfolio where such asset belongs to.
After impairment test, if the carrying value exceeds the recoverable amount of the asset, the balance is
recognized as impairment loss. As long as impairment loss of the aforementioned assets is recognized, it
couldn’t be switched back in later accounting periods. Recoverable amount of assets refers to the higher of
fair value of assets net disposal expense and present value of predicted cash flow of the asset.
Indications for impairment are as follows:
(1) Market value of asset drops a lot in current period, the drop scope is obviously greater than the predicted
drop due to move-on of times or normal utilization;
(2) Economy, technology or law environment where enterprise operates or market where asset is located will
148
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
have significant change in current or recent periods, which brings negative influence to enterprise;
(3) Market interest rate or returning rate of other market investments have risen in current period, which
brings influence in calculating discount rate of present value of predicted future cash flow of assets, which
leads to a great drop in recoverable amount of such assets;
(4) Evidence proving that asset is obsolete and out of time or its entity has been damaged;
(5) Asset has been or will be keep aside, terminating utilization or disposed advance;
(6) Internal report of enterprise shows that economic performance of asset has been or will be lower than
prediction, such as that net cash flow created by asset or operation profit (or loss) realized by asset is greatly
lower (or higher) than the predicted amount;
(7) Other indications showing possible impairment of assets.
20. Goodwill
Goodwill represents balance between equity investment cost or business combination cost under no common
control exceeding the attributable part or fair value of recognizable net assets of party invested or purchased
(obtained through business combination) as of acquisition day or purchase day.
Goodwill relating to subsidiaries is separately listed in consolidated financial statement. And goodwill
relating to associates and joint-ventures is included in carrying value of long-term equity investment.
21. Long-term deferred expenses
Long-term deferred expenses of the Company refer to the expense which has been paid out while should be
amortized from the current period and periods thereafter, with amortization term over 1 year (excluding 1
year). Such expense is averagely amortized during the beneficial period. If such long-term deferred expense
could not bring benefit to following accounting periods, the unamortized value of the item shall be fully
transferred to current gains and losses.
22. Staff remuneration
Employee benefits mainly include all kinds of remuneration incurred in exchange for services rendered by
employees or compensation to the termination of employment relationship such as short-term wages,
post-employment benefits, compensation for the termination of employment relationship and other
long-term employee welfare.
Short-term remuneration includes: staff salary, bonus, allowances and subsidies, staff benefits, social
insurances like medical insurance, work-related injury insurance and maternity insurance, housing fund,
labor union funds and staff education funds, short-term paid absence of duty, short-term profit sharing
scheme, non-monetary benefits as well as other short-term remuneration. During the accounting period when
staff provides services, the short-term remuneration actually occurred is recognized as liabilities and shall be
included in current gains and losses or related asset costs according to the beneficial items.
Retirement benefits mainly consist of basic pension insurance, unemployment insurance and
early-retirement benefits, etc. retirement benefit scheme represents the agreement reached by the
149
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Company and its employees in respect of retirement benefits, or the rules or regulations established by the
Company for providing retirement benefits to employees. In particular, defined contribution plan means a
retirement benefit plan, pursuant to which, the Company makes fixed contribution to independent fund,
upon which, it is not obliged to make further payment. Defined benefit plan refers to retirement benefit
scheme other than defined contribution plan.
The early retirement policy for staff and workers of the Company is the compensation for encouraging staff
and workers to accept the reduction voluntarily. The employees make applications voluntarily, the two
parties sign the compensation agreement after approved by the Company and calculate the compensation
amount according to the compensation standard passed by the staff representative conference, and the
Company confirms it as dismiss welfare and reckons it in current profits and losses. As the Company
promises to adjust the treatment for early retiring staff and workers with the increase of social basic cost of
living allowances, the discount elements will not be considered for calculating the dismiss welfare.
23. Estimated liabilities
If the business in connection with such contingencies as a security involving a foreign party, commercial
acceptance bill discount, pending litigation or arbitration, product quality assurance, etc. meets all of the
following conditions, the Company will confirm the aforesaid as liabilities: the obligation is an existing
obligation of the Company; performance of the obligation is likely to cause economic benefits to flow out of
the enterprise; the amount of the obligation is reliably measurable.
24. Principle of recognition of revenue and measurement method
The Company’s sales revenue is mainly comprised of revenue from sale of goods, labor providing income
and revenue from assignment of asset use rights. The principle of recognition of such revenue is as follows:
(1) Revenue from the sale of goods shall be recognized when the Company has transferred to the buyer the
significant risks and rewards of ownership of the goods; the Company retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods sold; the
amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow
into the Company; The export business is recognised when the packing list is received; and the associated
costs incurred or to be incurred can be measured reliably. Air-conditioner OEM/ODM will recognize revenue
while notes issued after commodity transferring to the shipping space that appointed by the client.
(2) The Company confirms the realization of service income when the gross income and total cost of labor
service cab be unfailingly calculated, the economic benefits related to labor service are likely to flow into the
Group, and the progress of labor service can be confirmed reliably. On balance sheet date, with regard to
those with results provided for labor service transactions can be estimated reliably, confirm the relevant
service income according to percentage of completion method and determine the percentage-of-completion
method by the proportion of the occurred cost in the estimated total cost; as for those with results provided
for labor service transactions can’t be estimated reliably and with occurred labor cost predicted to be able to
get compensation, confirm to provide service income according to labor cost amount occurred and capable of
getting compensation, and carry over the occurred labor costs; for those with results provided for labor
service transactions can’t be estimated reliably and with occurred labor cost predicted to be not able to get
150
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
compensation, reckon the occurred labor cost in the current profits and losses, but not confirm to provide
service income.
(3) The economy benefit of use-right of transfer assets probably wills inflow to the Company, if the income
can be measure accountability, than use-right income of transfer assets recognized.
25. Government subsidies
Government subsidy at the Company be able to meet its attached conditions, and can be confirmed when
received. Government grants for monetary assets, in accordance with the measurement of the amount
actually received, according to a fixed quota for the allocation of the grant criteria, in accordance with the
amount of accounts receivable measurement; government subsidies for non-monetary assets, in accordance
with the fair value, fair value should not reliably achieved, in accordance with the notional amount (RMB
1.00) measurement.
Asset-related government grants recognized as deferred income, and average life of related assets included in
the current profit and loss distribution. With the proceeds of the relevant government subsidies to compensate
for the period after the relevant costs or losses recognized as deferred income and, while recognizing the
associated costs included in current period profit and loss; for compensation related costs that have occurred
or loss, directly gains and losses included in the current period.
26. Deferred Income Tax Assets and Deferred Income Tax Liabilities
A deferred tax asset and deferred tax liability shall be determined by a difference (temporary difference)
between the carrying amount of an asset or liability and its tax base. The deferred tax asset shall be
recognized for the carry forward of unused deductible losses that it is probable that future taxable profits will
be available against which the deductible losses can be utilized. For temporary difference arising from initial
recognition of goodwill, no corresponding deferred income tax liabilities will be recognized. For temporary
difference arising from initial recognition of assets and liabilities occurred in the transaction related to non
business combination which neither affect accounting profit nor assessable income (or deductable losses), no
corresponding deferred income tax assets and deferred income tax liabilities will be recognized. As of the
balance sheet date, deferred income tax assets and deferred income tax liabilities are measured at the
effective tax rate applicable to the period when recovery of assets or settlement of liabilities occur.
The Company recognizes deferred income tax assets to the extent of future assessable income tax which is
likely to be obtained to offset deductable temporary difference, deductable losses and tax credits.
27. Lease
The Company categorizes the lease into the financial lease and the operating lease.
The financial lease is the lease in which all risks and returns related to the ownership of assets are transferred
in substance. The Company as a lease holder, on the date of lease, the financial lease is recognized as the
fixed asset at lower cost of fair value of the rental asset and the NPV of minimum payment of leasing. The
minimum payment of leasing is recognized as long-term payable and the difference is accounted into
unrecognized financing expense.
151
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
The operating lease is the lease apart from the financial lease. The Company, as a lease holder, accounts the
rents into current period by straight line method during the term of the lease. The Company, as a leaser,
accounts the rental income into current period by straight line method during the term of the lease.
28. Income tax accounting
The Company accounted the income tax in a method of debit in balance sheet. The income tax expenses
include income tax in the current year and deferred income tax. The income tax associated with the events
and transactions directly included in the owners’ equity shall be included in the owners’ equity; and the
deferred income tax derived from business combination shall be included in the carrying amount of
goodwill, except for that above, the income tax expense shall be included in the profit or loss in the current
period.
The income tax expense in the current year refers to the tax payable, which is calculated according to the
tax laws on the events and transactions incurred in the current period. The deferred income tax refers to the
difference between the carrying amount and the deferred tax assets and deferred tax liabilities at the
year-end recognized in the method of debit in the balance sheet.
29. Segment information
Business segment was the major reporting form of the Company, which divided into 4 parts: air-conditioner,
refrigerator and freezer, marketing and others. The transfer price among the segments will recognize
based on the market price, common costs will allocated by income proportion between segments except for
the parts that without reasonable allocation.
30. Explanation on significant accounting estimation
The management of the Company needs to apply estimation and assumption when preparing financial
statement which will affect the application of accounting policy and amounts of assets, liabilities, income
and expense. The actual condition may differ from the estimation. Constant evaluation is conducted by the
management in respect of the key assumption involved in the estimation and judgment of uncertainties.
Effect resulting from change of accounting estimation is recognized in the period the change occurs and
future periods.
The following accounting estimation and key assumption may result in material adjustment to the book
value of assets and liabilities in future period.
(1) Inventory impairment provision
The Company provides impairment provision according to the type of finished products and goods delivered
under fixed proportion, and estimates the realizable net value of inventories by reference to the projected
selling price of similar inventories less sales expenses and related taxes on a regular basis, so as to evaluate
the rationality of the provision proportion. If the actual selling price or expense differs from the previous
estimation, the management will make corresponding adjustment to the proportion. The estimation results
based on existing experiences may differ from the latter actual results, which may result in adjustment to the
book value of inventories in the balance sheet and affect over the gains and losses of the period when the
152
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
estimation changes.
(2) Accounting estimation on long-term assets impairment provision
The Company makes impairment test on fixed assets such as buildings, machine and equipments which have
impairment indication and long-term assets such as goodwill as at the balance sheet date. The recoverable
amount of relevant assets and assets group shall be the present value of the projected future cash flow which
shall be calculated with accounting estimation.
If the management amends the gross profit margin and discount rate adopted in calculation of future cash
flow of assets and assets group and the amended gross profit margin is lower than the currently adopted one
or the amended discount rate is higher than the currently adopted one, the Company needs to increase
provision of impairment provision. If the actual gross profit margin is higher (or the discount rate is lower)
than the estimation of management, the Company can not transfer back the long term assets impairment
provision provided already.
(3) Accounting estimation on realization of deferred income tax assets
Estimation on deferred income tax assets needs estimation on the taxable income and applicable tax rate for
each future year. Realization of deferred income tax assets depends on whether a company is able to obtain
sufficient taxable income in future. Change of future tax rate and switch back of temporary difference could
affect the balance of income tax expense (gains) and deferred income tax. Change of the aforesaid estimation
may result in material adjustment to deferred income tax.
(4) Usable term and residual value rate of fixed assets and intangible assets
The Company, at least at the end of each accounting year, reviews the projected usable life and residual value
rate of fixed assets and intangible assets. The projected usable life and residual value rate are determined by
the management based on the historical experiences of similar assets by reference to the estimation generally
used by the same industry with consideration on projected technical upgrade. If material change occurs to
previous estimation, the Company shall accordingly adjust the depreciation expenses and amortization
expenses for future period.
(5) Projected liabilities arising from product quality guarantee
The Company commits to repair the major spare parts of refrigerators sold through go-to-countryside
promotion activity for free for ten years. As to the maintenance expenses that may be increased arising from
such commitment, the Company has provided projected liabilities.
Taking into account the various uncertainties during the ten years, the Company considers no discount factor
of such projected liabilities. In stead, the Company reviews the parameters (probility, proportion,
maintenance expense per single set) based on the actual occurrence of maintenance expenses as of each
balance sheet date. If obvious change is found, the Company will adjust the projected liabilities according to
the latest parameters so as to reflect the best estimation.
31. Other comprehensive income
Other comprehensive income represents various gains and losses not recognized in current gains and losses
according to other accounting rules.
Other comprehensive income items shall be reported in the following two classes under other relevant
153
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
accounting rules:
(1) Other comprehensive income items that can not be reclassified into gains and losses in future accounting
periods, mainly including changes arising from re-measurement of net liabilities or net assets under defined
benefit plan and interest in investee’s other comprehensive income which are measured under equity method
and which can not be reclassified into gains and losses in future accounting periods;
(2) Other comprehensive income items that will be reclassified into gains and losses in future accounting
periods upon satisfaction of required conditions, mainly including interest in investee’s other comprehensive
income which are measured under equity method and which will be reclassified into gains and losses in
future accounting periods upon satisfaction of required conditions, gains or losses arising from change of fair
value of available-for-sale financial assets, gains or losses arising from reclassification of held-to-maturity
investment into available-for-sale financial assets, gains or losses occurred by cash flow hedging instruments
attributable to effective hedge, foreign currency financial statement translation difference, etc.
32. Change of significant accounting policies and accounting estimates
(1) Change of significant accounting policies
The Company had no change of significant accounting policies in the year.
(2) Change of significant accounting estimates
The Company had no change of significant accounting estimates in the year.
V. Taxation
1. Major taxes (expenses) and tax rates
Tax(expenses) Tax base Tax rate
Income from sales of goods, processing, primary
17%, 13%, 11%, 6% or 5%
VAT agricultural products, tangible movable property
charge rate
leasing and real estate leasing
Rental income and off-price expense (Switched to
Business tax 5%
VAT on May 1)
Urban maintenance and
Turnover tax 5% or 7%
construction tax
Education surcharge Turnover tax 3%
Local education surcharge Turnover tax 2%
Corporate income tax Taxable income 15% or 25%
Original Book value of house property×(1-30%)or
House Property Tax 1.2% or 12%
annual rent income
Land use tax Actual land area used RMB 2.5/M2 to RMB 15 /M2
2. Preferential tax and approval documents
The Company and its subsidiary Zhongke Meiling Cryogenics Technology Limited Company were
154
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
recognized as second Hi-Tech Enterprise for year of 2014 in Anhui Province with term of three years.
Therefore, the Company and its subsidiary Zhongke Meiling Cryogenics Technology Limited Company
enjoys 15% rate for the income tax for State Hi-Tech Enterprise. On 22 January 2015, being recognized by
―Name Lists of First Hi-Tech Enterprise for year of 2014 in Anhui Province‖[WGQR(2014) No. 37] from
Anhui Science & Technology Department, the Company and Zhongke Meiling Cryogenics Technology
Limited Company continuous to enjoy 15% rate for the income tax for State Hi-Tech Enterprise for three
years term.
Subsidiary Zhongshan Changhong Electric Co., LTD. was recognized as First Hi-Tech Enterprise for year of
2008 in Guangdong Province with 15% rate for the income tax for State Hi-Tech Enterprise enjoys for term
of three years. On 10 October 2014, being recognized by ―Name Lists of Second Hi-Tech Enterprise for year
of 2014 in Guangdong Province‖[YKGS(2014) No.15] from Guangdong Science & Technology Department,
Zhongshan Changhong Appliance Co., Ltd. continuous to enjoy 15% rate for the income tax for State
Hi-Tech Enterprise for three years term.
Subsidiary Sichuan Changhong Air Conditioner Co., Ltd. approved the re-examination of high-tech
enterprise dated 25 December 2013, and was granted the ―Certificate of High-tech Enterprise‖ (certificate
No.: GR201051000154) with a maturity of three years. Being approved and file by First Branch of Local
Tax Bureau of Mianyang City, Sichuan Changhong Air Conditioner Co., Ltd. was subject to enterprise
income tax at a rate of 15%.
Subsidiary Mianyang Meiling Softwar Technology Co., Ltd. pass the software enterprise certificate on 27
June 2014, and obtained the Software Enterprise Certification [Chuan No.:R-2014-0072]. Calcuting the
promotion period since the year of profit-making, the 1st year to 2nd year, the income tax shall be exempted,
levy income tax based on half of the statutory rates from the 3rd year to 5th year, and enjoy the preferential till
expired
The subsidiary Mianyang Meiling Refrigeration Company Limited obtained the approval
(CJXCYH(2014)408) from the Economic and Information Commission of Sichuan province on 9 May 2014,
which indicated that the Company belonged to encouraging industries as set out under the Industrial
Structure Adjustment Guideline Catalogue as amended in 2011 (GJFGW No.21). It is entitled to the
preferential EIT as an enterprise of the West Development planning. Upon necessary filing with the tax
authorities, the Company has been subject to the income tax rate of 15% since 2014 for a term of seven
years.
VI. Notes to the major items in the consolidated financial statements
With respect to the financial statements figures disclosed below, unless otherwise specified, ―year-beginning‖
refers to Jan. 1, 2016; ―period-end‖ refers to Jun. 30, 2016; ―the period‖ refers to Jan. 1 to Jun. 30, 2016; ―the
same period of last year‖ refers to Jan. 1 to Jun. 30, 2015; the currency is RMB.
1. Monetary fund
155
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Ending balance Balance at year-begin
Cash 60,482.76 46,496.63
Bank deposit 3,877,671,618.65 2,043,331,029.26
Other Monetary fund 259,266,020.21 91,812,353.26
Total 4,136,998,121.62 2,135,189,879.15
Including:total amount deposited in overseas 1,230,174.50 3,650,516.73
Other monetary fund:
Item Ending balance
Bank acceptance deposits 97,385,468.03
Account of foreign currency for verification 39,727,837.71
Current deposit for the bank notes pool 115,776,832.46
UnionPay online 3,009,683.92
Taobao account 3,359,551.38
Tenpay 6,646.71
Total 259,266,020.21
The amount saving in Sichuan Changhong Group Finance Co., Ltd. (Changhong Finance Company) at
period-end converted as RMB 1,961,248,737.41.
According to the national policies relating to foreign exchange management, all goods payment denominated
in foreign currency should be transferred to reviewing accounts which may not be used temporarily. Upon
approval of such review, those payments may be transferred to general accounts. Due to the relatively short
time for reviewing foreign exchange, balance of the reviewing accounts is not limited on utilization.
2. Financial assets measured by fair value and reckoned into current gains/losses with their changes
Item Ending amount Amount at year-begin
Tradable financial assets 2,340,308.20 -
Including: Derivative financial assets 2,340,308.20 -
Other
Total 2,340,308.20 -
3. Notes receivable
(1) Category of notes receivable
Item Ending balance Balance at year-begin
Bank acceptance bill 1,318,714,498.00 1,286,319,058.59
Trade acceptance 312,921,539.26 13,624.15
Total 1,631,636,037.26 1,286,332,682.74
(2) Notes receivable mortgaged by end of the period
156
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Amount mortgaged by end of the period
Bank acceptance bill 424,908,045.67
Note: in order to improve the utilization rate of notes, the Company pledged to banks those notes that haven’t
expired yet in exchange for issuance of banking acceptance drafts.
(3) Note receivables endorsement or discount at period-end and are not expired on balance sheet date
No termination
Termination confirmation
Item confirmation amount at
amount at period-end
period-end
Bank acceptance bill 2,940,039,752.42
(4) No notes transfer to account receivable due to the failure implementation from drawer at period-end.
4. Accounts receivable
(1) Account receivable by category
Ending amount
Book balance Bad debt provision
Category
Percent Percent Book value
Amount Amount
age age
Significant account receivable and withdrawal
bad debt provision single
Account receivable withdrawal bad debt
provision by combination
Combination 1 1,552,436,800.30 75.84% 83,794,083.92 5.40% 1,468,642,716.38
Combination 2 479,466,301.28 23.42% - - 479,466,301.28
Subtotal of combination 2,031,903,101.58 99.26% 83,794,083.92 4.12% 1,948,109,017.66
Account receivable with single minor amount
15,165,847.30 0.74% 13,223,980.15 87.20% 1,941,867.15
but withdrawal bad debt provision singly
Total 2,047,068,948.88 100.00% 97,018,064.07 4.74% 1,950,050,884.81
(Continued)
Amount at year-begin
Book balance Bad debt provision
Category
Percent Percent Book value
Amount Amount
age age
Significant account receivable and withdrawal
bad debt provision single
Account receivable withdrawal bad debt
157
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
provision by combination
Combination 1 899,278,954.60 64.20% 50,987,076.18 5.67% 848,291,878.42
Combination 2 488,135,576.26 34.85% - - 488,135,576.26
Subtotal of combination 1,387,414,530.86 99.05% 50,987,076.18 3.67% 1,336,427,454.68
Account receivable with single minor amount
13,315,915.98 0.95% 11,347,048.83 85.21% 1,968,867.15
but withdrawal bad debt provision singly
Total 1,400,730,446.84 100.00% 62,334,125.01 4.45% 1,338,396,321.83
1) No account receivable with single major amount but withdrawal bad debt provision singly at period-end.
2) Account receivable with withdrawal bad debt provision for combination 1 by aging account
Ending balance
Age
Account receivable Bad debt provision Provision proportion
Within 1 year 1,534,579,385.97 76,728,969.30 5.00%
1-2 years 8,912,514.21 1,336,877.13 15.00%
2-3 years 4,873,790.67 1,705,826.73 35.00%
3-4 years 82,560.77 45,408.42 55.00%
4-5 years 76,975.62 65,429.28 85.00%
Over 5 years 3,911,573.06 3,911,573.06 100.00%
Total 1,552,436,800.30 83,794,083.92
3) Account receivable with no withdrawal bad debt provision for combination 2
Combination Book balance
Account connect with related parties 420,628,311.59
Letter of Credit 58,837,989.69
Total 479,466,301.28
4) At period-end account receivable with single minor amount but withdrawal bad debt provision singly,
refers to the minor single receivables, and withdrawal bad debt provision by combination shows no risk
characteristic of the receivables, 8 clients involved.
(2) Bad debt reserve provided for, reversed (or recovered) during this year
New accrual bad bedt in the year amounting to RMB 34,683,939.06; No trade receivables written-off in
previous year was recovered this year.
(3) No account receivable actually written-off in the Year.
In the Year, balance at period-end of top five receivables collected by arrears party amounting to RMB
1,009,115,461.71 in total, accounted for 49.30% of the receivables at balance of the period-end, the bad debt
provision accrual correspondingly amounting to RMB 33,285,764.48 at period-end balance.
5. Accounts paid in advance
158
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(1) Age of account paid in advance
Ending amount Amount at year-begin
Item
Amount Percentage Amount Percentage
Within 1 year 78,433,787.32 96.87% 66,062,097.51 97.09%
1－2 years 1,925,949.18 2.38% 1,427,195.93 2.10%
2－3 years 94,060.80 0.12% 84,878.71 0.12%
Over 3 years 512,866.29 0.63% 467,648.58 0.69%
Total 80,966,663.59 100.00% 68,041,820.73 100.00%
Top 5 of account paid in advance in balance at period-end amounting to RMB 57,814,142.97, accounted for
71.40% of the account.
6. Interest receivable
Item Ending balance Balance at year-begin
Deposit interest receivable 1,896,655.82 1,238,199.65
7. Other accounts receivable
(1) Category of other account receivable
Ending amount
Book balance Bad debt provision
Category
Percent Bookvalue
Amount Percentage Amount
age
Significant other account receivable and
withdrawal bad debt provision single
Other account receivable withdrawal bad
debt provision by combination
Combination 1 6,957,359.63 16.36% 2,292,921.65 32.96% 4,664,437.98
Combination 2 35,305,969.27 83.01% - - 35,305,969.27
Subtotal of combination 42,263,328.90 99.37% 2,292,921.65 5.43% 39,970,407.25
Other account receivable with single minor
267,932.63 0.63% 267,932.63 100.00% -
amount but withdrawal bad debt provision singly
Total 42,531,261.53 100.00% 2,560,854.28 6.02% 39,970,407.25
(Continued)
Amount at year-begin
Category
Book balance Bad debt provision Bookvalue
159
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Percent
Amount Percentage Amount
age
Significant other account receivable and
withdrawal bad debt provision single
Other account receivable withdrawal bad
debt provision by combination
Combination 1 9,229,628.47 21.24% 3,691,780.99 40.00% 5,537,847.48
Combination 2 33,956,987.82 78.14% - - 33,956,987.82
Subtotal of combination 43,186,616.29 99.38% 3,691,780.99 8.55% 39,494,835.30
Other account receivable with single minor
267,932.63 0.62% 267,932.63 100.00% -
amount but withdrawal bad debt provision singly
Total 43,454,548.92 100.00% 3,959,713.62 9.11% 39,494,835.30
1) No significant other account receivable and no withdrawal bad debt provision single at period-end.
2) Other account receivable with withdrawal bad debt provision for combination 1 by aging account
Ending balance
Age
Account receivable Bad debt provision Provision proportion
Within 1 year 2,899,785.21 144,989.26 5.00%
1-2 years 1,178,164.74 176,724.71 15.00%
2-3 years 698,700.00 244,545.00 35.00%
3-4 years 790,000.00 434,500.00 55.00%
4-5 years 656,980.00 558,433.00 85.00%
Over 5 years 733,729.68 733,729.68 100.00%
Total 6,957,359.63 2,292,921.65 —
3) Other account receivable with no withdrawal bad debt provision for combination 2
Combination Book balance
Contact with related party 268,074.38
Employee’s reserve loans 18,502,561.49
Export tax rebate receivable 16,535,333.40
Total 35,305,969.27
4) At period-end account receivable with single minor amount but withdrawal bad debt provision singly,
refers to the minor single receivables, and withdrawal bad debt provision by combination shows no risk
characteristic of other receivables.
(2) Reversal (or withdraw) of reserve for bad debts in the Year
Releasing bad-bebt provision in the Year amounting to RMB 1,398,859.34; bad debt recoverd the original
verification was RMB 6,000.00 in the year.
160
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(3) No actual verification of other receivables in the year
(4) Classification of other accounts receivable according to the nature of account
Nature Book balance at period-end Book balance at year-begin
Non-consolidated related party 16,535,333.40 20,269,116.73
Employee’s reserve loans 18,502,561.49 12,957,099.30
Deposit 4,343,749.87 3,918,959.87
Other 1,481,188.18 5,438,195.23
Advance money temporary 1,400,354.21 140,406.00
Non-related party account 268,074.38 730,771.79
Total 42,531,261.53 43,454,548.92
(5) Top 5 other receivables collected by arrears party at balance of period-end:
Bad Balance
Proportion in total
Balance at at period-end
Name Nature ofaccount Bookage other receivables at
period-end of debt
period-end
provision
Within 1
Tax bureau of Hefei Export tax rebate 16,535,333.40 38.88% -
year
Within 1
Huang Zhigang Asset disposal 1,350,000.00 3.17% 67,500.00
year
Within 1
Jiang Lin Employees deposit 1,177,451.65 2.77% -
year
Within 1
Li Miao Employees deposit 966,908.46 2.27% -
year
Within 1
Liu Xifeng Employees deposit 933,308.51 2.19% -
year
Total 20,963,002.02 49.28% 67,500.00
(6) No other account receivable involved government subsidies at period-end.
(7) No other receivables terminated recognization due to the transfer of financial assets at period-end.
(8) No assets and liability transferr other receivables and continues to involve at period-end.
8. Inventories
(1) Classification of inventories
Amount at period- end
Item
Bookbalance Impairment provision Book value
Rawmaterials 148,779,299.84 1,413,340.97 147,365,958.87
Stockcommodities 1,299,063,574.01 70,756,879.62 1,228,306,694.39
161
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount at period- end
Item
Bookbalance Impairment provision Book value
Low value consumable articles 11,897,317.81 - 11,897,317.81
Goodsin transit 140,873,127.33 87,047.65 140,786,079.68
Goods-in-process 19,161,409.06 - 19,161,409.06
Deferred expense for moulds 43,852,951.03 - 43,852,951.03
Total 1,663,627,679.08 72,257,268.24 1,591,370,410.84
(Continued)
Amount at year- begin
Item
Bookbalance Impairment provision Book value
Rawmaterials 142,734,356.80 1,427,876.25 141,306,480.55
Stockcommodities 1,290,558,995.85 79,430,353.78 1,211,128,642.07
Low value consumable articles 11,776,746.58 - 11,776,746.58
Goodsin transit 113,686,853.24 177,014.68 113,509,838.56
Goods-in-process 19,621,573.80 - 19,621,573.80
Deferred expense for moulds 57,602,927.95 - 57,602,927.95
Total 1,635,981,454.22 81,035,244.71 1,554,946,209.51
(2) Inventory falling price reserves
Amount at
Amount at Increased in the Decreased in the year
Item period-end
year-begin year
Switch-back Other switch-out
Raw materials 1,427,876.25 -14,535.28 - 1,413,340.97
Stock
79,430,353.78 3,272,286.38 11,945,760.54 70,756,879.62
commodities
Goods in
177,014.68 134,451.37 224,418.40 87,047.65
transit
Total 81,035,244.71 3,392,202.47 - 12,170,178.94 72,257,268.24
9. Other current assets
Item Balance at period-end Balance at year-begin Nature
Financial products - 500,000,000.00 Bank financial products
Value-added tax to be Reclassify of value-added
16,107,461.56 12,862,817.57
deducted tax to be deducted
Advance payment of income Reclassify of advance
14,332,658.84 24,200,227.82
tax payment of income tax
162
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Balance at period-end Balance at year-begin Nature
Advance payment of Reclassify of advance
- 2,038,533.05
business tax payment of business tax
Total 30,440,120.40 539,101,578.44
10. Finance asset available for sales
(1) Finance asset available for sales
Balance at period-end Balance at year-begin
Impairm Impairme
Item
Bookbalance ent Book value Bookbalance nt Book value
provision provision
Equity instrument available for
17,000,000.00 17,000,000.00 17,000,000.00 17,000,000.00
sales
Including: measured by fair value
Measured by cost 17,000,000.00 17,000,000.00 17,000,000.00 17,000,000.00
Total 17,000,000.00 17,000,000.00 17,000,000.00 17,000,000.00
(2) Finance asset available for sales measured by cost at period-end
Holding Cash
Decrease
Increase in proportion dividend
Invested Unit Year-begin in the Period-end
the yeary in invested for the
year
unit year
Huishang Bank Co., Ltd. 5,000,000.00 5,000,000.00 0.0972%
Sichuan Hongyun New it
12,000,000.00 12,000,000.00 16.00%
Investment Fund
Total 17,000,000.00 17,000,000.00
(3) No impairment reserve of finance asset available for sales at period-end.
163
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
11. Long-term equity investment
Change in the year
Impairmen
Investment Other Other Provisio
Balance at Disin Declaration of Balance at t reserve
Invested Unit Additional profit and loss comprehen changes n for
year-begin vestm cash dividends Other period-end balance at
investment confirmed by sive income of impair
ent or profits period-end
equity method adjustment equity ment
Associated companies
1.ChanghongRuba
29,713,680.32 -534,486.95 808,869.62 29,988,062.99
ElectricCompany(Private)Ltd.
2. Hefei Xingmei Assets Management
12,846,069.09 -56,019.64 12,790,049.45
Co., Ltd.
3. Sichuan Zhiyijia Network Technology
4,813,098.30 2,322,881.18 7,135,979.48
Co., Ltd.
4. Hengyuan Dineng Rebao Technology
4,045,502.68 4,900,000.00 -2,196,252.31 6,749,250.37
Company Limited
5. Sichuan Tianyou Guigu Technology
22,821,196.62 -682,887.61 22,138,309.01
Co., Ltd.
Total 74,239,547.01 4,900,000.00 - -1,146,765.33 808,869.62 - - - - 78,801,651.30
164
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
12. Investment properties
(1) Investment properties measured at costs
Houses and
Item Land use rights Total
buildings
I.Original book value
1.Balance at year-begin 23,142,172.83 916,691.38 24,058,864.21
2.Increased in the year
3.Decreased in the year
4.Balance at period-end 23,142,172.83 916,691.38 24,058,864.21
II.Accumulated depreciation and
accumulated amortization
1.Balance at year-begin 9,558,221.21 416,429.49 9,974,650.70
2.Increased in the year 385,106.79 19,184.28 404,291.07
(1) provision or amortization 385,106.79 19,184.28 404,291.07
3.Decreased in the year
4.Balance at period-end 9,943,328.00 435,613.77 10,378,941.77
III. Provision for impairment
IV. Book value
1.Book value at period-end 13,198,844.83 481,077.61 13,679,922.44
2.Book value at year-begin 13,583,951.62 500,261.89 14,084,213.51
(2) No investment real estate measured by fair value at period-end.
(3) No particular about mortgage of investment property at period-end.
(4) No investment real estate having not completed the property right certificate at period-end
13. Fixed assets
(1) Details of fixed assets
Houses and Mechanical Transport
Item Others equipment Total
buildings equipment equipment
I.Original bookvalue
1.Balance atyear-begin 921,581,186.91 971,993,630.24 25,328,176.24 158,551,637.05 2,077,454,630.44
2.Increased intheyear 4,820,694.03 44,386,481.23 431,163.31 6,995,260.43 56,633,599.00
(1)Purchase 2,649,436.80 964,638.32 382,494.03 2,510,554.97 6,507,124.12
(2) Construction in progress
2,171,257.23 43,421,842.91 45,640.17 4,482,897.51 50,121,637.82
transfer-in
(3)Assetreclassification ransfer-in
165
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Houses and Mechanical Transport
Item Others equipment Total
buildings equipment equipment
(4) Increase in exchange rate
- - 3,029.11 1,807.95 4,837.06
changes
3.Decreasedin theyear 2,120,034.24 17,059,770.22 1,039,474.58 1,948,561.85 22,167,840.89
(1) Disposeor retirement 2,120,034.24 17,059,770.22 1,039,474.58 1,948,561.85 22,167,840.89
(2) Transferred to construction in
process
(3)Asset reclassificationdecrease
(4) Otherdecrease
4.Balance atperiod-end 924,281,846.70 999,320,341.25 24,719,864.97 163,598,335.63 2,111,920,388.55
II.Accumulated
depreciation
1.Balance atyear-begin 155,193,162.74 567,509,433.24 16,171,932.43 67,688,069.73 806,562,598.14
2.Increased intheyear 15,150,575.24 46,939,329.31 1,054,758.01 6,326,323.91 69,470,986.47
(1)Provision 15,150,575.24 46,939,329.31 1,054,758.01 6,326,323.91 69,470,986.47
(2) Increaseofenterprisemerger
3.Decreasedin theyear 390,894.34 14,900,364.64 967,609.41 652,856.81 16,911,725.20
(1) Disposeor retirement 390,894.34 14,900,364.64 967,609.41 652,856.81 16,911,725.20
(2) Transferred to construction in
process
(3)Assetreclassificationdecrease
(4) Otherdecrease
4.Balanceatperiod-end 169,952,843.64 599,548,397.91 16,259,081.03 73,361,536.83 859,121,859.41
III.Provision for
impairment
1.Balance atyear-begin 1,240,639.77 1,950,369.18 7,403.67 199,687.70 3,398,100.32
2.Increased intheyear
3.Decreasedin theyear 950,000.00 - - - 950,000.00
(1) Disposeor retirement 950,000.00 - - - 950,000.00
4.Balance atperiod-end 290,639.77 1,950,369.18 7,403.67 199,687.70 2,448,100.32
IV Book value
1.Bookvalueatperiod-end 754,038,363.29 397,821,574.16 8,453,380.27 90,037,111.10 1,250,350,428.82
2.Bookvalueatyear-begin 765,147,384.40 402,533,827.82 9,148,840.14 90,663,879.62 1,267,493,931.98
(2) No fixed assts temporary idle at period-end.
(3) No fixed assets for collateral at period-end.
166
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(4) No fixed assets leased through operating lease at period-end.
(5) No fixed assets leased through operating lease at period-end.
Accumulated Depreciation
Item Original book value Net book value
depreciation provision
Mechanical
251,274.95 191,388.94 59,886.01
equipment
Transport equipment 197,640.00 187,758.00 9,882.00
Other equipment 38,098,356.52 9,254,329.98 28,844,026.54
Total 38,547,271.47 9,633,476.92 - 28,913,794.55
Other equipments leased under operating lease refer to the air conditioners leased out by Changhong Air
Conditioner to university dormitories. According to the contract, Changhong Air Conditioner installed air
conditioners at the places designated by the university, and the university is responsible for use and
maintenance of the air conditioners. The leasing fee paid by the university consists of: air conditioner leasing
fee, installment and dismantle fee, repair and maintenance fee, normal maintenance fee and depreciation fee.
The leasing fee is subject to payment per study year. Upon expiration of the leasing agreement, the university
has the right to choose new service provider or continue cooperation with Changhong Meiling.
(6) Fixed assts without property certificate (House and buildings)
Reason of not complete the
Item Book value
property cerfificate
Inspection room of 7# freezer palnt 223,872.47 In procedure
II canteen of living area 25,021,910.92 In procedure
Hot water room of living area 2,814,405.68 In procedure
7#Freezer Plant 29,259,521.05 In procedure
8#Freezer Plant 29,441,416.42 In procedure
9#Freezer Plant 32,849,729.61 In procedure
Freezer salvage station 294,135.84 In procedure
Freezer subsidiary station 3,505,962.36 In procedure
3#Big refrigerator Plant 83,278,185.37 In procedure
3#Big refrigerator finished-goods Plant 44,594,678.28 In procedure
Canteen 2,158,803.07 In procedure
3# makeshift shelter 4,819,035.29 In procedure
4# makeshift shelter 5,650,638.18 In procedure
5# makeshift shelter 4,353,504.13 In procedure
6# building for cadremen 7,562,846.94 In procedure
7# building for cadremen 6,957,084.78 In procedure
167
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
8# makeshift shelter 4,386,176.83 In procedure
Total 287,171,907.22
(7) No fixed assets ready for sale at period-end.
14. Construction in progress
(1) Details of construction in progress
Amount at period-end Amount at year-begin
Imp Book value Imp Book value
air air
men men
Item Book Book
t t
balance balance
pro pro
visio visio
n n
Phase II of industry park capacity expansion 2,099,680.58 2,099,680.58 1,996,064.77 1,996,064.77
Construction project of Phase II for matching
- - 1,325,050.00 1,325,050.00
life district of Industrial Park
Project of mid-large volume environment icebox production
- - 540,601.71 540,601.71
annualoutputfor0.6 million
Relocation and capacity expansion project of
28,258,911.67 28,258,911.67 4,420,650.01 4,420,650.01
Zhongke Meiling
Capacity expansion of energy-saving and
environmental refrigerator with annual output 36,085.47 36,085.47 36,085.47 36,085.47
of 2 millions sets
Equipments pending for installation 2,689,663.29 2,689,663.29 4,033,590.36 4,033,590.36
Laboratory reconstruction of water cooled
- - 1,597,191.46 1,597,191.46
chiller and water source heat pump unit
Phase 1 VISA laboratory - - 4,692,307.69 4,692,307.69
KA line 2,429,229.95 2,429,229.95 1,279,229.95 1,279,229.95
Comprehensive promotion of non shrink tube
87,220.00 87,220.00 7,725,638.80 7,725,638.80
expander
Central air conditioning relocation and
1,092,360.60 1,092,360.60 1,092,360.60 1,092,360.60
Capacity Upgrading Project
R290 line transformation 11,372,942.18 11,372,942.18 9,920,126.79 9,920,126.79
The new purchase of evaporator with 6.35 C
547,008.54 547,008.54 2,764,217.07 2,764,217.07
production line
C line small refrigerator production and
- - -
transformation projects 2,319,042.81 2,319,042.81
168
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount at period-end Amount at year-begin
Imp Book value Imp Book value
air air
men men
Item Book Book
t t
balance balance
pro pro
visio visio
n n
The freezer front-end equipment capacity
1,515,940.18 1,515,940.18 -
expansion project 2,332,760.65 2,332,760.65
M linetransformation capacityupgradeproject 10,170,175.27 10,170,175.27 2,944,802.39 - 2,944,802.39
Project of Jiangxi Meiling’s squeeze board
593,777.99 593,777.99 -
line removal
Other miscellaneousitems 6,925,581.99 6,925,581.99 7,485,160.46 - 7,485,160.46
Total 67,818,577.71 67,818,577.71 56,504,880.99 56,504,880.99
(2) Changes in significant construction in progress
Trans
Book Increase
fer to fixed Other Book balance
Projects balance at during the Source offunds
assets in decrease at period-end
year-begin year
the year
Relocation and capacity
expansion project of 4,420,650.01 23,838,261.66 28,258,911.67 Self-raised
Zhongke Meiling
Phase II construction project of
1,325,050.00 1,325,050.00 - Self-raised
Meilingtech industrialparkliving area
Project of mid-large volume
environment icebox production 540,601.71 540,601.71 - Self-raised
annualoutputfor0.6 million
(Continued)
Accumulated including: Interest
Proportion of
amount of interest capitaliza
Budget (in 10 project Progres
Projects interest capitalized tion rate
thousand yuan) investment in s
capitalizatio amount of the of the
budget
n year year
Relocation and capacity
expansion project of 11,354.04 24.89% 19%
Zhongke Meiling
Phase II construction project of 4,859.00 93.79% 100%
169
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Meilingtech industrialparkliving area
Project of mid-large volume
environment icebox production 6,679.00 88.17% 100%
annualoutputfor0.6 million
(3) No depreciation reserves for construction in process at period-end.
15. Disposal of fixed assets
Amount at Reasons for disposal
Item Ending amount
year-begin transferred
Relocation for land
Relevant assets disposal for reserved lands 75,788,138.47 75,773,138.47
reserve
Pursuant to the urban planning requirements of the People’s Government of Hefei city, Hefei Land Reserve
Center plans to purchase and store the land use right of an integrated economic development zone of the
Company located at Longgang of Hefei with an area of 103,978.9 sq.m. (Approximately 155.9684 mu, Land
Use Right Certificate No.: Dong Guo Yong (2004) Zi No. 0200, the stated use of the land is for industrial
purpose). The estimated consideration for purchasing and storage is RMB74.48 million. The land is mainly
used for the Company’s warehouse, product finishing workshop and the factory of Zhongke Meiling.
Pursuant to the purchasing and storage requirements of land use right, the land will be purchased and stored
with vacant possession. In April 2013, the Company completed the relocation of occupants of the premises,
and the net fixed assets in relation to the land will transfer as disposal, accounting treatment will be conduct
in line with relevant rules upon receiving of the relocation compensation.
Pursuant to the urban planning requirements of Hefei Municipal Government and the Government of
Feidong county, the land reserve center of Feidong county will purchase and store the land use right of an
economic development zone located at Feidong county, Hefei city, which is owned by the Company’s
subordinate companies, Equator Electric and Equator Home Appliance, respectively, with an area of
19,245.09 sq.m. (Approximately 28.87 mu, Land Use Right Certificate No.: Dong Guo Yong (2008) No.
0366, the stated use of the land is for industrial purpose) and an area of 46,161.9 sq.m. (Approximately 69.24
mu, Land Use Right Certificate No.: Dong Guo Yong (2008) No. 0367, the stated use of the land is for
industrial purpose). The total consideration for purchasing and storage is approximately RMB36 million, of
which the consideration for the land use right owned by Equator Electric and Equator Home Appliance is
approximately RMB10.59 million and RMB25.41 million, respectively. The Company has completed the
relocation of occupants of the premises, and the net fixed assets in relation to the land will transfer as
disposal, accounting treatment will be conduct in line with relevant rules upon receiving of the relocation
compensation.
16. Intangible assets
(1) According to intangible assets item
170
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Trademark Non-patent
Item Land use right Other Total
special right technology
I.Original book
value
1.Balance at
621,593,887.18 283,292,439.34 125,275,031.23 12,406.87 1,030,173,764.62
year-begin
2.Increased in the
31,129,531.30 149,292.45 31,278,823.75
year
3.Decreased in the
year
4.Balance at
621,593,887.18 283,292,439.34 156,404,562.53 161,699.32 1,061,452,588.37
period-end
II.Accumulated
depreciation
1.Balance at
104,809,120.83 267,076,417.49 64,838,113.89 413.56 436,724,065.77
year-begin
2.Increased in the
6,500,848.44 1,941,443.40 10,958,792.09 16,169.94 19,417,253.87
year
(1) Provision 6,500,848.44 1,941,443.40 10,958,792.09 16,169.94 19,417,253.87
3. Decreased in the
year
4. Balance at
111,309,969.27 269,017,860.89 75,796,905.98 16,583.50 456,141,319.64
period-end
III. Provision for
impairment
IV. Book value
1.Book value at
510,283,917.91 14,274,578.45 80,607,656.55 145,115.82 605,311,268.73
period-end
2.Book value at
516,784,766.35 16,216,021.85 60,436,917.34 11,993.31 593,449,698.85
year-begin
As of the period-end, mortgage of intangible assets is as follows:
Name Property certificate serials Area(M2) Net book value Note
See Note 32.
Land use right HGYJCZi No.: 0121 27,120.22 20,439,947.72
Long-term loans
17. Development expense
171
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Increase during the
Decrease during the year
year
Balance at Ending
Item Internal Included in Confirmed as
year-begin balance
development other current profits intangible Other
expenditure and losses assets
Technology
development for 50,919,386.00 23,555,738.77 - 1,762,426.90 28,482,550.00 - 44,230,147.87
Air-conditioner
Technology
development for 2,397,040.54 8,489,274.83 - - 2,646,981.30 - 8,239,334.07
refrigerator
Technology
development for 28,401.18 455,131.33 - - - - 483,532.51
others
Total 53,344,827.72 32,500,144.93 - 1,762,426.90 31,129,531.30 - 52,953,014.45
18. Goodwill
(1) Original value of goodwill
Increase during the Decrease during the
year year
Name of invested Balance at Formation Formation
Ending balance
unit year-begin from from
Other Other
enterprise enterprise
merger merger
Hefei Meiling Group
10,922,803.73 10,922,803.73
Holding Co., Ltd.
Guangxi Huidian
Household Electrics 5,313,913.50 5,313,913.50
Co., Ltd
Total 16,236,717.23 16,236,717.23
(2) Impairment provision of goodwill
Increase during the Decrease during the
Name of invested Balance at
year year Ending balance
unit year-begin
Provision Other Provision Other
Hefei Meiling Group
10,922,803.73 10,922,803.73
Holding Co., Ltd.
Guangxi Huidian
5,313,913.50 5,313,913.50
Household Electrics
172
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Increase during the Decrease during the
Name of invested Balance at
year year Ending balance
unit year-begin
Provision Other Provision Other
Co., Ltd
Total 16,236,717.23 16,236,717.23
19. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets
Ending balance Balance at year-begin
Deductible Deferred Deductible Deferred
Item
temporary income tax temporary income tax
difference assets difference assets
Deferred income tax assets recognized from
127,559,491.79 19,498,110.66 110,979,461.54 16,646,919.23
property depreciation preparation
Deferred income tax assets recognized from
333,689,789.42 50,053,468.41 338,125,014.55 50,718,752.18
accrual liability
Deferred income tax assets recognized from
36,764,268.61 5,514,640.29 45,269,999.29 6,790,499.89
Dismission welfare
Deferred income tax assets recognized from
54,575,742.18 8,186,361.33 28,526,710.37 4,279,006.56
deferred income
Deferred income tax assets recognized from
1,278,570.21 191,785.53 - -
changes in the fair value
Total 553,867,862.21 83,444,366.22 522,901,185.75 78,435,177.86
The ―Deferred income tax assets recognized from changes in the fair value‖ at period-end is the net amount
resulted from offsetting between deferred income tax assets and deferred income liabilities
(2) Details of unrecognized deferred income tax assets
Item Ending balance Balance at year-begin
Deductible temporary difference 46,004,111.56 33,825,285.91
Deductible loss 317,189,143.50 381,710,616.21
Total 363,193,255.06 415,535,902.12
20. Other non-current assets
Item Ending balance Balance at year-begin
Term deposit for pledge 45,158,472.00 44,221,416.00
21. Short-term loans
173
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(1) Types of short-term loans
Type of loans Ending balance Balance at year-begin
Loan in pledge - 24,268,373.19
Loan in credit 718,762,164.03 34,411,720.00
Total 718,762,164.03 58,680,093.19
New loans in the Period:
1) The Company signed the Export Commercial Invoice Financing Business Cooperation Agreement (JHL
SP2015-04) with the Construction Bank of China Hefei Luyang Branch. It was agreed that export
commercial invoice financing facilities shall not exceed RMB170 million with the term from 14 October
2015 to 22 July 2016. As of 30 June 2016, the balance of borrowing under this credit facilities was
6,200,000.00, equivalent of RMB 45,725,000.00.
2) The Company entered into Trading Financing Comprehensive Credit Agreement with China Everbright
Bank Hefei Branch, which specified that the total trading financing facilities shall not exceed RMB300
million. On 28 August 2015, Trading Financing Comprehensive Credit Agreement (2015MMLH) was
executed for issuance of import letter of credit business, import negotiation, export negotiation business,
discounting business under forward letter of credit as well as performance guarantee business. As of 30 June
2016, the total balance of the borrowings under this credit agreement was 8,000,000.00, equivalent to RMB
59,000,000.00.
3) The Company entered into an Agreement on Trade Financing (TF) [Serial No.: 2016-008] with Hefei
Jinzai Road Branch of Agricultural Bank of China, the Agreement stands from 1 Jan. 2016 to 31 Dec. 2016.
The borrowing balance corresponding to the Agreement up to 30 June 2016 was US$ 15,410,000.00,
equivalent to RMB 102,186,792.00.
4) The Company entered into a Cooperation Agreement on Cross-Border Funnded Risk Participation of CBC
with Hefei Luyang Branch of Construction Bank of China, the Agreement stands from 27 May 2016 to 23
November 2016. The borrowing balance corresponding to the Agreement up to 30 June 2016 was
US$ 7,500,000.00, equivalent to RMB 49,734,000.00.
5) The Company entered into an Export Accounts Receivable Pool Financing Business Contract [Serial No.:
HF1640620150056] with Hefei Branch of Hua Xia Bank. The borrowing balance corresponding to the
Contract up to 30 June 2016 was US$ 15,661,414.53, equivalent to RMB 103,853,972.03.
6) The Company entered into a TF Master Agreement with Hefei Branch of CMSB, total amount for trade
financing agreed up to Two Hundred Million Yuan. The borrowing balance corresponding to the Agreement
up to 30 June 2016 was US$ 2,000,000.00, equivalent to RMB 13,262,400.00.
7) The Company entered into a General Agreement of Export Order Financing with Hefei Changjian Road (E)
Branch of ICBC. The borrowing balance corresponding to the Agreement up to 30 June 2016 was RMB
45,000,000.00.
174
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
8) The Company entered into an Export TF Contract with Hefei Branch of Bank of Communications, total
amount for export trade financing agreed up to Three Hundred Million Yuan. The borrowing balance
corresponding to the Contract up to 30 June 2016 was RMB 300,000,000.00.
(2) No overdue short term borrowings unredeemed at period-end.
22. Financial liabilities at fair value through gains and losses
Item Ending balance Balance at year-begin
Derivative financial liabilities 3,618,878.41 -
Total 3,618,878.41 -
23. Notes payable
Type Ending balance Balance at year-begin
Bank acceptance bill 2,716,301,619.00 2,154,377,903.42
Commercial acceptance bill 117,940,976.61 17,687,020.37
Total 2,834,242,595.61 2,172,064,923.79
Notes expired at period-end without paid.
24. Account payable
(1) Age of account payable
Item Ending balance Balance at year-begin
Total 2,340,133,319.01 1,604,075,191.50
Including: over 1 year 45,356,636.58 35,963,023.64
No account payable with over one year book age at period-end.
25. Account payable
(1) Age of account payable
Item Ending balance Balance at year-begin
Total 305,437,199.80 295,604,800.16
Including: over 1 year 12,137,577.52 17,816,277.00
(2) No major account received in advance with over one year age at period-end.
26. Wages payable
(1) Types of wages payable
175
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at Increase in this Decrease in this
Item Ending balance
year-begin year year
Short-term compensation 104,153,335.66 512,560,179.35 548,617,351.81 68,096,163.20
After-service welfare- defined
4,085,558.31 39,437,837.43 39,301,116.22 4,222,279.52
contribution plans
Dismiss welfare 7,058,535.43 3,195,294.54 4,344,751.64 5,909,078.33
Total 115,297,429.40 555,193,311.32 592,263,219.67 78,227,521.05
(2) Short-term compensation
Balance at Increase in this Decrease in this
Item Ending balance
year-begin year year
Wages ,bonuses, allowancesand subsidies 94,179,244.88 454,206,750.12 489,667,571.18 58,718,423.82
Welfare for workers and staff 105,706.00 19,321,765.96 19,340,473.43 86,998.53
Social insurance 2,358,874.25 16,716,480.74 16,813,121.29 2,262,233.70
Including: Medical insurance 2,196,322.88 14,167,984.92 14,257,781.84 2,106,525.96
Work injury insurance 79,480.84 1,292,675.70 1,318,574.37 53,582.17
Maternity insurance 83,070.53 1,255,820.12 1,236,765.08 102,125.57
Housing accumulation fund 6,032,414.92 21,678,925.47 22,134,303.03 5,577,037.36
Labor union expenditure and
1,477,095.61 636,257.06 661,882.88 1,451,469.79
personnel education expense
Total 104,153,335.66 512,560,179.35 548,617,351.81 68,096,163.20
(3) Defined contribution plans
Balance at Increase in this Decrease in this
Item Ending balance
year-begin year year
Basic endowment insurance 3,186,528.80 36,697,464.48 36,618,194.61 3,265,798.67
Unemployment insurance 899,029.51 2,740,372.95 2,682,921.61 956,480.85
Total 4,085,558.31 39,437,837.43 39,301,116.22 4,222,279.52
The Company withdrew the outstanding salary, bonus and subsidy from the closing balance of staff salary
payables which were granted in the Period.
27. Tax payable
Item Ending balance Balance at year-begin
Value-added tax 131,792,428.52 36,732,243.37
Business tax 49,694.05 345,276.14
Enterprise income tax 3,115,987.88 506,399.61
Individual income tax 2,431,831.84 1,807,299.13
176
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Ending balance Balance at year-begin
Urban maintenance and construction tax 13,025,293.50 4,102,776.80
House property tax 5,103,702.14 5,722,887.03
Land-use right tax 4,746,706.15 4,688,835.65
Educational surtax 9,330,628.60 2,917,920.88
Stamp tax 914,794.00 2,012,329.38
Construction fund of Water Conservancy Projects 478,896.95 496,683.41
Treatment fund for abandon electric & electronics products 15,748,166.00 9,140,895.00
Other 2,092,478.23 2,056,937.14
Total 188,830,607.86 70,530,483.54
Tax payable at period-end increased over beginning of the year mainly because during the peak season,
payable VAT increased over that of year-begin.
28. Interest payable
(1) Classification of interest payable
Item Ending balance Balance at year-begin
Interest on long-term loans of installment payment 35,547.83 214,328.89
(2) No significant overdue and unpaid interest ar period-end.
29. Dividends payable
Item Ending balance Balance at year-begin
City Insurance company 376,729.65 302,954.85
Hefei Branch of BOC 188,364.80 151,477.40
Hefei collective industry association 188,364.52 151,477.18
BOC-Fullgoal Tianyi Securities Investmen Fund 153,697.50 153,697.50
Entrust Investment Wuhu of Provincial ABC 150,691.86 121,181.94
Other piecemeal units 1,487,952.90 1,319,711.04
Total 2,545,801.23 2,200,499.91
Balance at period-end refers to the common dividends that not receiving by shareholders.
30. Other payable
(1) Classfication of other payable according to nature of account
Nature of account Ending balance Balance at year-begin
177
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Nature of account Ending balance Balance at year-begin
1.Accrued expenses(expenses occurred without reimbursed) 833,862,522.66 510,133,656.28
2. Receivables recived temporary and deducted temporary 14,337,908.79 10,538,181.53
3.Deposit, margin 83,721,396.26 76,195,308.46
4.Not the come-and-go with related parties in statement scope 6,697,108.06 7,472,243.44
5.Other 32,115,294.44 39,227,697.62
Total 970,734,230.21 643,567,087.33
(2) Other significant payables aging over one year as at the period-end mainly refers to the procurement
deposit.
31. Non-current liability due within one year
(1) Classification of non-current liability due within one year
Item Ending balance Balance at year-begin
Long term loans due within one year 250,000,000.00 -
Deferred income transfer to gains and losses within one year 11,130,799.00 11,153,067.68
Total 261,130,799.00 11,153,067.68
(2) Deferred income transfer into profit and loss within 1 year
Subsidy Amount
increase reckoned into
Amount at Other Ending
Itemofgovernment subsidies during non-operation Assets-related/Income-related
year-begin changes balance
this revenue in the
period Period
Demolition
compensation of 1,797,880.32 898,940.16 898,940.16 1,797,880.32 Assets-related
Jiangxi Meiling
Demolition
compensation of Hefei 2,467,003.32 1,226,476.44 1,204,207.68 2,444,734.56 Assets-related
Meiling
technical reform for
4,286,250.00 2,143,125.00 2,143,125.00 4,286,250.00 Assets-related
Athena Project
Freezer project of Hefei
734,062.44 367,031.25 367,031.33 734,062.52 Assets-related
Meiling
New generation of intelligent
energy-saving AC and
1,700,000.00 1,700,000.00 Assets-related
industrialization for key
apponents
178
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Subsidy Amount
increase reckoned into
Amount at Other Ending
Itemofgovernment subsidies during non-operation Assets-related/Income-related
year-begin changes balance
this revenue in the
period Period
Adaptability
improvement
167,871.60 83,935.80 83,935.80 167,871.60 Assets-related
R290/D52/13-R290 project
for production of FTXS
Total 11,153,067.68 4,719,508.65 4,697,239.97 11,130,799.00
32. Long-term loans
(1) Classification of long-term loans
Type Ending Amount Amount at year-begin
Loan in pledge 44,588,188.80 43,662,966.40
Loan in mortgage 3,200,000.00 3,840,000.00
Loan in credit 2,501,900.00 195,501,900.00
Total 50,290,088.80 243,004,866.40
(2) Details of long-term loans at period-end
Amount at
Borrowing Returning Foreign Interest Amount at
Loan unit year-begin
day day currency rate period-end（RMB）
（RMB）
Zhongshan Branch of China Guangfa
2014-12-24 2017-12-24 USD 3.20% 11,936,160.00 11,688,480.00
BankNote1
Zhongshan Branch of China Guangfa
2015-1-6 2018-1-6 USD 3.20% 32,652,028.80 31,974,486.40
BankNote2
Ministry of Finance of HefeiNote3 2002-11-21 2017-11-20 RMB 1.80% 1,301,900.00 1,301,900.00
Ministry of Finance of HefeiNote4 2004-12-10 2019-12-10 RMB 1.80% 1,200,000.00 1,200,000.00
Ministry of Finance of HefeiNote5 2006-11-9 2021-11-8 RMB 2.55% 3,200,000.00 3,840,000.00
Anhui branchImport and Export Bank
Note6
2015-12-18 2017-4-18 RMB 2.65% - 193,000,000.00
Total 50,290,088.80 243,004,866.40
Note1: On 24 December 2014, subsidiary Zhongshan Changhong entered into Foreign Currency
Mid-Longterm Loan Contract with Zhongshan Branch of China Guangfa Bank, agred that issuing foreign
currency USD1, 800,000.00 to the Company. The loans are contributed for the joint venture project in
Pakistan, which are Zhongshan Changhong Electrics and RUBA GENERAL TRADING FZE. This
borrowing was secured by the fixed deposit of USD 1,820,000.00 saved by Zhongshan Changhong in China
Guangfa Bank Zhongshan Branch.
179
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Note 2: on 6 January 2015, subsidiary Zhongshan Changhong entered into Middle and Long Term Foreign
Currency Borrowing Contract with China Guangfa Bank Zhongshan Branch, which agreed that China
Guangfa Bank Zhongshan Branch would provide loans of USD 4,924,000.00 to the Company to finance the
joint venture project conducted by Zhongshan Changhong Appliances Co., Ltd and RUBA GENERAL
TRADING FZE Company in Pakistan. This borrowing was secured by Zhongshan Changhong with the fixed
deposits of USD 86, 000.00 and USD 4, 904,000.00 saved by it in China Guangfa Bank Zhongshan Branch,
respectively.
Note 3: on 1 November 2002, the Company entered into the Agreement Relating to Implementing
Construction Projects through Lending Treasury Bond Funds with the finance office of Hefei, pursuant to
which, the finance office of Hefei lent the treasure bonds or RMB7.16 million related to our ―Technology
Reform Project in relation to Nanometer Materials for Retaining Freshness‖ to our Company, with a terms of
15 years. The lent funds have begun to carry interest commencing from the date of appropriation of funds by
the finance office of Hefei (namely 21 November 2002), and the Company shall pay the interests to the
finance office of Hefei annually on an average basis during the lending period. The first four years of the
loan is grace period. The interest rate per annum applicable to the lent funds is floating interest rate since
1999 (for interest rate per annum in respect of each batch of Treasury bond lending capital, it is determined
by reference to one-year time deposit rate per annum on value date of the prevailing year as published by the
PBOC, plus 0.3 percentage points).
Note 4: It was the special treasury bond capital appropriated by Ministry of Finance of Hefei for enterprises’
information reform, received on Dec. 10th, 2004.
Note 5: In August of 2006, the Company signed Asset Mortgage Agreement with Ministry of Finance of
Hefei. It takes five industry crusher chambers which cover an area of 2,322.98 square meters as mortgage for
the Company to get the lending of treasury bond fund which has 15-year term and worthy of RMB 7,040,000
from the Ministry of Finance of Hefei. The capital on-lending began to bear interest from the appropriate
date (November 9, 2006), which would be paid by stages in the loan period to Ministry of Finance of Hefei
by the Company. The first four years were grace period, during which the annual interest rate was subject to
floating interest rate (Annual rate will be determine by the Notice on Regular Payment for interest &
principal of the Treasury Bond Fund Lending issued by Hefei Municipal Bureau of Finance). On 1 March
2013, according to the Letter Relating to Ceasing Process of Other Securities in respect of the Properties in
Feidong Longgang Industrial Park of Hefei Meiling Co., Ltd. (HCJ(2006)No.85) issued by the finance office
of Hefei, Meiling commenced the national purchase of its land parcels in Longgang in compliance with the
land planning of Hefei municipal government, which required its properties in Longgang land parcel to be
unrestricted. The real estate for mortgage lifted in 2006 of the Company with registration No. HGYJCZ
No.0121 which was used as the security for treasury bonds lending capital (details were set out in Note
VI.13). The Company repaid principal of RMB 640,000.00 and interest of RMB 97,900.00 in this year.
Note 6: on 18 December 2015, the Company and the Export-Import Bank Anhui Branch executed a
Borrowing Contract (High-tech Products Export Seller Credit) which agreed that the Export-Import Bank
Anhui Branch would grant to the Company loans with total facilities of RMB250 million. Utilization of this
180
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
loan is subject to export of high-tech products only. The term of the loan is 16 months, and the interest rate is
based on export seller credit rate. The long-term bowwrings at period-end are re-classify to ―Non-current
liability due within one year‖ for presentation.
33. Long-tern wage payable
Balance at
Item Ending balance
year-begin
Dismissal welfare 30,855,190.28 38,211,463.86
Total 30,855,190.28 38,211,463.86
34. Projected liability
Item Ending balance Balance at year-begin Reason
Product quality guarantee 11,146,216.49 11,146,216.49 Guarantee of product
Guarantee fund for quality service 322,543,572.93 326,978,798.06 Guarantee of product
Total 333,689,789.42 338,125,014.55
Product quality deposit is the maintenance expense provided by the Company under the national policy,
while quality service special guarantee capital is the warranty costs provided for product quality in addition
to such policy.
35. Deferred income
(1) Classification of deferred income
Amount at
Item Ending amount
year-begin
Government subsidies---subsidies of development project 54,369,086.41 52,631,208.54
Government subsidies---subsidies of Relocation 78,072,325.24 80,259,410.00
Total 132,441,411.65 132,890,618.54
(2) Government subsidy
Amount Concerned
New
Amount at reckoned into Other with
Item subsidy in Ending amount
year-begin non-operatin changes assets/earni
the Year
g income ngs
Demolition compensation of Assets
47,378,064.69 1,204,207.68 46,173,857.01
Hefei Meiling concerned
technical reform for Athena Assets
17,736,562.50 2,143,125.00 15,593,437.50
Project concerned
Freezer project of Hefei 2,936,250.04 367,031.33 2,569,218.71 Assets
181
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount Concerned
New
Amount at reckoned into Other with
Item subsidy in Ending amount
year-begin non-operatin changes assets/earni
the Year
g income ngs
Meiling concerned
Low temperature refrigeration equipment Assets
5,000,000.00 5,000,000.00
industrializationproject concerned
Relocation of Mianyang Meiling Assets
23,526,710.37 83,936.92 23,442,773.45
productionbase concerned
Capital appropriated from the national Assets
2,950,000.00 2,950,000.00
treasury concerned
Assets
VISA research and application 10,100,000.00 10,100,000.00
concerned
Development and productization of the Assets
2,350,000.00 2,350,000.00
CHIQ AC concerned
Adaptability improvement
Assets
R290/D52/13-R290 project for 7,258,396.00 - 83,935.80 7,174,460.20
concerned
production of FTXS
Intelligent white-goods software platform
Assets
and research and industrialization of typical 4,000,000.00 4,000,000.00
concerned
applications
Demolition compensation of Assets
9,354,634.94 898,940.16 8,455,694.78
Jiangxi Meiling concerned
Research and application of frequency Assets
- 2,300,000.00 2,300,000.00
conversion controlMCUchip concerned
Subsidy for air-conditioner of Assets
- 31,970.00 31,970.00
energy-savinghouse concerned
Research and industrialization of intelligent Assets
- 2,000,000.00 2,000,000.00
controlsystemfor indoorairquality concerned
Design and application of energy saving Assets
300,000.00 300,000.00
airconditioningduct concerned
Total 132,890,618.54 4,331,970.00 83,936.92 4,697,239.97 132,441,411.65
36. Share capital
Change during theyear（+、-）
Shares
Balance at New transferred Balance at
Item Bonus
year-begin shares from Other Subtotal period-end
share
issued capital
reserve
182
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Change during theyear（+、-）
Shares
Balance at New transferred Balance at
Item Bonus
year-begin shares from Other Subtotal period-end
share
issued capital
reserve
Total shares 763,739,205.00 763,739,205.00
37. Capital reserve
Amount at Increase during the Decrease during Amount at
Item
year-begin year the year period-end
Share premium 1,481,014,545.23 99,962,053.64 1,381,052,491.59
Other capital reserve 48,169,810.90 3,451.80 48,173,262.70
Total 1,529,184,356.13 3,451.80 99,962,053.64 1,429,225,754.29
Decreases of the share premium in the Period, mainly because: in January 2016, Guangdong Changhong
Ridian Technology Co., Ltd. was included in the consolidate statement scope for investment by the Company
in way of enterprise combine under the same control. The statement at period-begin are re-presented in line
with the rules.
38. Other comprehensive income
Account in the year
Less:written
in other
comprehensiv
e income in
previous Belong to Belong to
Balance at Account before Less : Balance at
Item period and parent minority
year-begin income tax in income tax period-end
carried company shareholders
the year expense
forward to after tax after tax
gains and
losses in
current
period
Other comprehensive income re-divided into gains/losses
Including: conversion
difference arising
-2,280,500.61 2,484,848.72 1,814,457.07 670,391.65 -466,043.54
from foreign currency
financial statement
39. Surplus reserves
183
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount at Increase during the Decrease during Amount at
Item
year-begin year the year period-end
Statutory surplus reserve 251,459,292.02 251,459,292.02
Discretionary surplus reserve 115,607,702.16 115,607,702.16
Total 367,066,994.18 367,066,994.18
40. Retained profit
Item This period Last year
Balance at period-end of last year 817,667,531.64 835,453,313.49
Add: adjustment from undistributed profit at year-begin 8,143,561.37
Including: retroactive adjustment by Accounting Standards for
Business Enterprise
Change of accounting policy
Correction of former material error
Change of combination scope under common control 8,143,561.37
Balance at year-begin of the year 817,667,531.64 843,596,874.86
Add: net profit attributable to shareholders of parent company for this
109,992,701.28 27,104,897.12
year
Less: withdraw of statutory surplus reserve 7,209,888.04
withdraw of discretional surplus reserve
Withdraw of general risk provision
Dividend payable for ordinary shares 45,824,352.27 45,824,352.30
Dividend of ordinary shares transferred to share capital
Balance at period-end 881,835,880.65 817,667,531.64
41. Operating income and operating cost
(1) Operating income and operating cost
Amount for this Amount for the same
Item
period period of last year
Main business income 6,635,243,672.98 6,303,928,575.41
Other business income 231,387,589.70 268,551,391.33
Total 6,866,631,262.68 6,572,479,966.74
Main business cost 5,226,428,116.77 4,976,932,459.27
Other business cost 206,033,570.33 236,560,244.26
184
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for this Amount for the same
Item
period period of last year
Total 5,432,461,687.10 5,213,492,703.53
(2) Main business classified according to product
Amount for this period Amount for the same period of last year
Product
Operation income Operation cost Operation income Operation cost
Refrigerator,
3,511,755,682.66 2,641,347,914.01 3,512,414,086.42 2,709,365,844.09
freezer
Air-condition 2,578,582,275.76 2,117,657,552.65 2,441,545,800.41 1,973,497,153.25
Washing
214,447,675.62 174,849,330.14 132,189,681.66 107,975,889.59
machine
Other 330,458,038.94 292,573,319.97 217,779,006.92 186,093,572.34
Total 6,635,243,672.98 5,226,428,116.77 6,303,928,575.41 4,976,932,459.27
(3) Main business classified according to sales region
Amount for this period Amount for the same period of last year
Region
Operation income Operation cost Operation income Operation cost
Domestic 4,999,875,111.36 3,763,161,367.63 4,992,074,159.04 3,784,976,069.38
Overseas 1,635,368,561.62 1,463,266,749.14 1,311,854,416.37 1,191,956,389.89
Total 6,635,243,672.98 5,226,428,116.77 6,303,928,575.41 4,976,932,459.27
Top five clients have income in sales of RMB 2,564,919,633.80 yuan in total, a 37.35% in total operation
income.
42. Business tax and extra charges
Amount for the same Amount for this
Amount for this period
period of last year period
Business tax 354,041.11 381,847.10
City construction tax 19,899,317.46 10,690,695.68
Extra charge for education and local education surcharge 14,421,660.64 7,840,737.70
Treatment fund for abandon electrics & electronics 27,244,167.00 26,557,501.00
Other 222,391.26 252,185.17
Total 62,141,577.47 45,722,966.65
43. Sales expense
Amount for this Amount for the same
Item
period period of last year
Market support fee 267,473,422.40 165,821,875.39
185
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Salary and extra, social security 236,101,636.65 223,627,148.79
Transport expenses 207,605,016.03 225,384,243.39
Air conditioner installation fee 120,680,390.00 108,043,860.00
National three guarantees expense 82,896,108.22 82,731,870.82
Storage lease expenses 51,149,832.06 56,817,423.67
Advertisement expenses 29,181,669.39 22,028,522.55
Travelling expenses 14,924,457.13 15,666,868.56
Operation activities expenses 8,087,086.19 8,457,802.06
Meeting organization 6,235,033.36 4,856,614.75
House-lease expenses 5,521,119.25 3,924,534.55
Vehicle consumption 3,604,088.38 3,201,808.05
Depreciation expenses 2,999,300.47 2,563,349.22
Communication expenses 2,432,210.13 2,713,750.62
Exhibition cost 2,267,160.86 1,384,286.00
Other expenses 34,489,220.08 29,544,895.20
Total 1,075,647,750.60 956,768,853.62
44. Administration expense
Amount for this Amount for the same
Item
period period of last year
Salary and social security etc. 78,371,373.79 78,106,261.72
Trial fee of R&D 19,368,311.75 20,337,756.39
Amortized intangible assets 19,260,530.22 16,551,239.00
Tax fee 17,316,003.79 17,152,917.97
Depreciation fee 10,181,555.80 9,121,252.18
Inspection and authentication fee 4,684,054.78 4,009,588.95
Domestic travelling fee 4,132,225.03 4,268,082.81
Utilities 4,029,484.90 6,195,790.08
Business activities 3,906,395.17 2,710,602.39
Office charge 3,027,548.26 3,600,649.96
Property insurance 1,797,851.23 1,639,216.72
Others 27,205,090.02 33,590,628.04
Total 193,280,424.74 197,283,986.21
45. Financial expense
186
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for this Amount for the same
Item
period period of last year
Interest expenditure 4,108,756.46 10,512,502.13
Less: Interest income 32,356,650.27 51,382,806.82
Add: exchange loss -18,503,350.12 -5,757,556.52
Procedure charge expenditure 10,153,124.33 2,075,669.89
Discount expenditure -3,102,122.56 -1,149,949.37
Other expenditure 900.00 26,068.11
Total -39,699,342.16 -45,676,072.58
46. Loss from Assets depreciation
Amount for this Amount for the same
Item
period period of last year
Bad debt losses 33,194,478.64 34,115,646.92
Provision for falling price of inventory 3,392,202.47 1,342,189.73
Total 36,586,681.11 35,457,836.65
47. Changes in fair value gains/losse
Amount for this Amount for the same
Item
period period of last year
Financial assets measured at fair value and whose movements are
2,340,308.20 3,572,100.00
included in the profit and loss of the current period
Including :Income of fair value changes from derivative financial
2,340,308.20 3,572,100.00
instruments
Financial liabilities measured at fair value and whose movements are
-3,618,878.41 81,170.00
included in the profit and loss of the current period
Including :Income of fair value changes from derivative financial
-3,618,878.41 81,170.00
instruments
Total -1,278,570.21 3,653,270.00
48. Investment income
(1) Sources of investment income
Amount for this Amount for the same
Item
period period of last year
Long-term equity investment income by equity method -833,210.42 -6,482,572.94
Investment income obtained from disposal of finance asset available
- 480,332.00
for sales
Other 4,986,301.37 517,808.22
187
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for this Amount for the same
Item
period period of last year
Total 4,153,090.95 -5,484,432.72
(2) Long-term equity investment income by equity method
Amount for the
Amount for Reason of change of this
Item same period of
this period year than last year
last year
Changes of net profit of the
Hefei Xingmei Assets Management Co., Ltd. -56,019.64 -161,530.37
invested unit
ChanghongRuba ElectricCompany(Private)Limited -220,932.04 486,831.97
Changes of net profit of the
Sichuan Zhiyijia Network Technology Co., Ltd. 2,322,881.18 -6,416,155.32
invested unit and counter
Hongyuan Dineng Rebao Technology Co. Ltd. -2,196,252.31
current transaction offset
Sichuan Tianyou Guigu Technology Co., Ltd. -682,887.61 -391,719.22
Total -833,210.42 -6,482,572.94
(3) Investment income obtained from disposal of finance asset available for sales:
Amount for this Amount for the same
Item
period period of last year
Disposal of equity of Fuyang Jiujiang Meiling Appliance Marketing
- 480,332.00
Co., Ltd.
Total - 480,332.00
(4) Others:
Amount for this Amount for the same
Item
period period of last year
Trust financing 4,986,301.37 517,808.22
Total 4,986,301.37 517,808.22
49. Non-operation revenue
(1)Non-operation revenue
Amount reckoned
Amount for the same into non-recurring
Item Amount for this period
period of last year gains/losses in the
Year
Gains from disposal of non-current
330,833.76 14,784.00 330,833.76
assets
Including:Gains from disposal of 330,833.76 14,784.00 330,833.76
188
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount reckoned
Amount for the same into non-recurring
Item Amount for this period
period of last year gains/losses in the
Year
fixed assets
Goverment subsidy 16,456,206.17 12,344,884.49 14,750,673.67
Income of penalty 301,433.90 371,270.49 301,433.90
Other 4,383,228.61 2,280,248.88 4,383,228.61
Total 21,471,702.44 15,011,187.86 19,766,169.94
(2) Goverrment subsidy
Amount for the
Amount for this Assets/benefit
Item same period of Resource and basis
period related
last year
Skillgrantforposition - 87,500.00 He Ren She Mi (2013)No.:139 Benefitrelated
Drawback policy of VAT for
VAT refunds 1,705,532.50 4,028,798.75 Benefitrelated
software product
Subsidy for brand propagate Yue Shangwu Cai Han [2014]
- 2,000,000.00 Benefitrelated
extension aboard No.:143
Other government subsidy etc. 2,641,549.48 1,355,811.00 - Benefitrelated
OtherDeferred income transfer-in 4,803,445.57 4,872,774.74 Deferred income transfer-in Assets related
City Commercial Bureau- special
A special fund of trade promotion
1,733,000.00 fund of trade promotion for year Benefitrelated
for year of 2016
of 2016
Reward of the new-type
industrialization development 1,538,700.00 He Zhen [2015] No. 36 Benefitrelated
policy promotion
Subsidy for technically improve of
1,217,800.00 He Zhen [2015] No. 36 Benefitrelated
the fixed assets
Hefei 2015 Economic &
Technological Development Area
Subsidy of industry carry-over fund 1,000,000.00 (HETA) - promotion of the Benefitrelated
new-type industrialization
development policy
Agreement of the Tianjin Xintai
Industrial Economic
Policy rewards 1,014,456.72 Benefitrelated
Development Management
Center
Enterprise development fund Contract of the investment of 2
801,721.90 Benefitrelated
distributed by High-Tech Zone million frigerators for one year
189
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for the
Amount for this Assets/benefit
Item same period of Resource and basis
period related
last year
Total 16,456,206.17 12,344,884.49
50. Non-operating expenditure
Amount reckoned
Amount for the same into non-recurring
Item Amount for this period
period of last year gains/losses in the
Year
Loss from disposal of non-current
1,545,129.64 5,700,586.03 1,545,129.64
assets
Including: loss from disposal of fixed
1,545,129.64 1,545,129.64
assets
5,700,586.03
Penalty and late fee 259,138.22 2,207,106.34 259,138.22
Other 14,606.32 1,360,703.50 14,606.32
Total 1,818,874.18 9,268,395.87 1,818,874.18
51. Income tax expenses
Amount for the same
Item Amount for this period
period of last year
Current income tax 23,825,374.34 17,784,503.80
Deferred Income Tax -5,009,188.36 -3,272,330.20
Total 18,816,185.98 14,512,173.60
52. Other comprehensive income
Found more in ―VI. 38. Other comprehensive income‖ in the Note
53. Items of cash flow statement
(1) Cash received (paid) from (for) other activities relating to operation/investment/financing
1) Cash received from other activities relating to operation
Amount for the same
Item Amount for this period
period of last year
Goverment subsidy and rewards 9,947,228.10 3,355,811.00
Margin, deposit 3,672,988.85 3,830,556.27
Rental and trade mark income 3,930,732.75 3,401,766.87
Compensations 103,131.84 633,835.83
Other 1,961,189.58 3,795,593.47
190
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for the same
Item Amount for this period
period of last year
Total 19,615,271.12 15,017,563.44
2) Cash paid for other activities relating to operation
Amount for the same
Item Amount for this period
period of last year
Marketing supporting fee 100,020,332.36 80,633,153.77
AD charge 14,594,018.03 27,446,706.38
Business expenses 21,472,512.46 21,940,902.20
Rental expense 9,218,885.60 12,450,147.10
Business activities expenses 11,903,159.89 12,058,369.67
Pretty cash for employees 11,554,152.86 7,935,074.23
Meeting organization charge 7,113,406.24 5,334,604.14
Regular bus expenses 4,598,247.00 4,991,269.00
Certification and Inspection costs 5,446,512.42 3,684,382.29
vehicle costs 3,973,278.42 3,012,365.60
Handling Charges 25,077,479.49 2,694,554.88
Office Charges 3,575,528.11 2,786,126.70
Exhibition expenses 3,215,177.35 1,497,432.71
Penalty and overdue fine 259,138.22 2,207,106.34
Changes of the limited monetary fund 60,085,067.00 50,768,920.59
Others 36,462,279.04 100,509,234.93
Total 318,569,174.49 339,950,350.53
3) Cash received from other activities relating to investment
Amount for the same
Item Amount for this period
period of last year
Interest income arising from bank savings 31,720,923.67 50,775,845.44
Government investment granted 4,331,970.00 2,350,000.00
Margin 336,823.00 287,933.60
Total 36,389,716.67 53,413,779.04
4) Cash paid for other activities relating to investment
Amount for the same
Item Amount for this period
period of last year
Tender bond of projects returned - 427,715.77
191
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
5) Cash received from other activities relating to financing
Amount for the same
Item Amount for this period
period of last year
Odd shares returned by stock exchange 3,451.80 -
6) Cash paid for other activities relating to financing
Amount for the same
Item Amount for this period
period of last year
Handling charge of dividend 98,192.48 93,855.90
Amount refund to minority shareholders due to the
- 130,164.45
cancellation of subsidiary
Total 98,192.48 224,020.35
(2) Supplementary information about consolidated cash flow statement
Amount for the same period
Item Amount for this period
of last year
1. Net profit is adjusted to cash flow of operation
activities:
Net profit 109,923,646.84 158,829,148.33
Add: provision for depreciation of assets 36,586,681.11 35,457,836.65
Depreciation of fixed assets, consumption of oil
gas assets and depreciation of productive biological 69,875,277.54 71,058,016.79
assets
Amortization of intangible assets 19,417,253.87 16,497,028.01
Amortization of long-term retained expense
Loss from disposal of fixed assets, intangible
assets and other long term assets(gain is listed with 1,214,295.88 5,685,802.03
―-‖)
Loss from discarding fixed assets as useless (gain
is listed with ―-‖)
Loss from change of fair value(gain is listed with
1,278,570.21 -3,653,270.00
―-‖)
Financial expense (gain is listed with ―-‖) -28,247,893.81 -40,870,304.69
Investment loss (gain is listed with ―-‖) -4,153,090.95 5,484,432.72
Decrease of deferred income tax assets (increase is
-5,009,188.36 -3,272,330.20
listed with ―-‖)
Increase of deferred income tax liabilities
192
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount for the same period
Item Amount for this period
of last year
(decrease is listed with ―-‖)
Decrease of inventories (increase is listed with ―-‖) -27,646,224.86 227,109,371.01
Decrease of operational accounts receivable
-995,881,410.16 -1,494,652,495.21
(increase is listed with ―-‖)
Increase of operational accounts payable (decrease
1,694,331,587.58 1,374,699,974.30
is listed with ―-‖)
Other
Net cash flow arising from operation activities 871,689,504.89 352,373,209.74
2. Major investment and financing activities that do
not involve cash receipts:
Conversion of debt into capital
Switching Company bonds due within one year
financing lease of fixed assets
3. Net change in cash and cash equivalents:
Balance at period-end of cash 4,062,884,413.48 2,829,327,347.72
Less: Balance at year-begin of cash 2,121,161,238.01 2,709,097,193.11
Add: Balance at period-end of cash equivalents
Less: Balance at year-begin of cash equivalents
Net increase in cash and cash equivalents 1,941,723,175.47 120,230,154.61
(3) No net cash paid for subsidiary obtained in the Year
(4) No cash received by disposal of subsidiary in the Year
(5) Cash and cash equivalent
Item Amount for the period Amount at period-begin
Cash 4,062,884,413.48 2,121,161,238.01
Including: cash in stock 60,482.76 46,496.63
Bank deposits available for payment at any time. 3,877,671,618.65 2,043,331,029.26
Bank deposits available for payment at any time 185,152,312.07 77,783,712.12
Cash equivalents
Including: bond investment due within 3 months
Balance of cash and cash equivalents at period end 4,062,884,413.48 2,121,161,238.01
Including: using the restiicted cash and cash equivalents of the
parent company or subsidiary of the group
54. Assets with ownership or the right to use restricted
193
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Ending book value Reasons
Monetary fund 74,113,708.14 Bank acceptance margin and Taobao account margin
Notes receivable 424,908,045.67 Pledged
Intangible assets 20,439,947.72 Long term loan collateral
Other non-current assets 45,158,472.00 Fixed deposit pledge
Total 564,620,173.53
55. Foreign currency
(1) Foreign currency
Ending foreign currency Ending RMB converted
Item Exchange rate
balance balance
Monetary fund
Including: USD 51,894,371.09 6.6312 344,121,953.54
Euro 3,922,627.09 7.3750 28,929,374.76
AUD 1,221,342.38 4.9452 6,039,782.34
Rupi 19,430,966.73 0.0633 1,230,174.50
Account receivable
Including:USD 80,511,552.20 6.6312 533,888,204.97
Euro 9,282,110.87 7.3750 68,455,567.67
AUD 1,553,082.19 4.9452 7,680,302.05
Rupi 1,050,816,711.46 0.0633 66,527,206.00
Other receivables
Including:USD 67,569.47 6.6312 448,066.67
Rupi 34,093,451.11 0.0633 2,158,456.39
Accounts payable
Including:USD 1,650,996.56 6.6312 10,948,088.39
Rupi 7,994,822.84 0.0633 506,152.23
Other accounts payable
Including:USD 936.81 6.6312 6,212.17
Rupi 111,591,460.00 0.0633 7,064,855.33
Short-term loans
Including:USD 40,571,414.53 6.6312 269,037,164.03
Euro 14,200,000.00 7.3750 104,725,000.00
Long-term loans
Including:USD 6,724,000.00 6.6312 44,588,188.80
194
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(2) Foreign operational entity
The foreign operational entity of the Company was Changhong Ruba Trading Company (Privat) Limited,
mainly operates in Lahore, Pakistan; Recording currency is Rupi.
VII. Changes of consolidation rage
1. Enterprise combined under the different control: Nil
2. Enterprise combined under the same control:
(1) Enterprise combined under the same control in the period
Reve Net
nue profit
Inter of the of the
Com
est combi combi Combi
bined
perc ned ned ned
party
enta party party party’
’s net
ge Basis of consider as Com from from s
Determine basis profi
obtai the business merger bine combi combi revenu
Combined party of combined t
ned under the same d ned ned e
date durin
in control date perio perio during
ga
busi d-beg d-beg a
comp
ness in to in to compa
ariso
merg the the rison
n
er date date
combi combi
ned ned
Guangdong Changhong Controlled by the 2016 Equity amount 151,58 -213,
98.8
Ridian Technology Co., same controlling .01.0 have been paid in - - 0,514.5 726.4
56%
Ltd. shareholder 1 toal 8 9
(2) Combined cost
Combined cost Amount
Cash 95,650,000.00
Book value of non cash assets -
Book value of the debt issued or undertaken -
(3) Book value of the assets and liabilities from the combined party on combination date
Item Combined date At period-end of last year
Assets:
Monetary Fund 67,851,083.54 63,218,175.23
Note receivable 26,112,732.92 37,633,773.70
195
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Account receivable 6,155,199.93 12,957,809.80
Advance payment 372,374.51 10,201.82
Other receivables 1,163,683.39 865,629.91
Stock 9,553,171.57 20,277,030.48
Fixed assets 46,666,626.48 46,604,346.93
Construction in process 1,649,025.81
Intangible assets 15,414,228.78 14,048,577.50
Development expenditure 648,720.51
Liabilities:
Short term loan 10,000,000.00
Notes payable 22,476,434.83 43,087,302.41
Accounts payable 25,720,395.79 32,512,293.44
Received in advance 4,641,104.91 3,037,887.91
Salary employees payable 3,461,506.14 1,975,807.68
Taxes payable 806,281.22 138,623.84
Other payable 24,329,982.23 15,923,574.59
Paid-in capital 83,000,000.00 83,000,000.00
Surplus reserve 2,354,955.23 2,293,395.81
Undistributed profit 6,498,440.77 5,944,406.01
Net assets 91,853,396.00 91,237,801.82
Less: minority shareholders'
1,050,802.85 1,043,760.45
equity
Net assets acquired 90,802,593.15 90,194,041.37
3. Reversed takeover: Nil
196
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
4. Subsidiary liquidated: Nil
5. Subsidiary established
Capial actually
Other balance that
RC (10 paid at Share-heldi Ratio of
Registere consider as the net Consolidate Minority’s
Subsidiary Type Business nature thousand period-end (10 ng Ratio voting right
d place investment for d (Y/N) interest
Yuan) thousand (%) (%)
subsidiary in nature
Yuan)
Changmei Limited Mianya Fresh electricity
5000.00 1,941.20 90.00 90.00 Yes 1,355,909.47
Technology Co., Ltd. company ng suppliers
197
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
VIII. Equity in other entity
1. Equity in subsidiary
(1) Composition of the enterpreise group
Share-helding ratio
Registration Business (%)
Subsidiary Business area Acquire way
place nature Indirectl
Directly
y
Manufactures,
ZhongkeMeilingCryogenicTechnologyCo., Ltd.1) Hefei Hefei 70.00 Investmentestablishment
sales
Software
MianyangMeilingSoftwareTechnologyCo., Ltd. 2) Mianyang Mianyang 99.00 1.00 Investmentestablishment
development
Manufactures,
MianyangMeilingRefrigeration Co., Ltd.3) Mianyang Mianyang 95.00 5.00 Investmentestablishment
sales
Manufactures,
JiangxiMeilingAppliance Co., Ld.4) Jingdezhen Jingdezhen 98.75 1.25 Investmentestablishment
sales
Hefei MeilingApplianceMarketingCo., Ltd.5) Hefei Hefei Sales 99.82 0.18 Investmentestablishment
Enterprise combined not under
GuangxiHuidian HomeApplianceCo., Ltd.6) Nanning Nanning Sales 100.00
thesame control
LuoheMeilingApplianceMarketingCo., Ltd.7) Luohe Luohe Sales 100.00 Investmentestablishment
Wuhu MeilingApplianceMarketingCo., Ltd.8) Wuhu Wuhu Sales 98.00 Investmentestablishment
ChangchunMeilingApplianceMarketing Co., Ltd.9) Changchun Changchun Sales 97.00 Investmentestablishment
Bengbu MeilingApplianceMarketingCo., Ltd.10) Bengbu Bengbu Sales 93.50 Investmentestablishment
JinanMeilingApplianceMarketing Co., Ltd.11) Jinan Jinan Sales 91.40 Investmentestablishment
NanchangXiangyouApplianceMarketingCo., Ltd.12) Nanchang Nanchang Sales 85.00 Investmentestablishment
Jingzhou MeilingApplianceMarketingCo., Ltd.13) Jingzhou Jingzhou Sales 96.00 Investmentestablishment
ShengyangMeilingApplianceMarketingCo., Ltd.14) Shenyang Shenyang Sales 98.60 Investmentestablishment
Wuhan MeizhirongApplianceMarketingCo., Ltd.15) Wuhan Wuhan Sales 91.00 Investmentestablishment
Zhengzhou MeilingApplianceMarketingCo., Ltd.16) Zhengzhou Zhengzhou Sales 95.00 Investmentestablishment
ShijiazhuangMeilingApplianceMarketing Co., Ltd.17) Shijiazhuang Shijiazhuang Sales 95.33 Investmentestablishment
MianyangMeilingApplianceMarketing Co., Ltd.18) Mianyang Mianyang Sales 93.80 Investmentestablishment
Chengdu MeilingApplianceMarketing Co.,Ltd.19) Chengdu Chengdu Sales 94.00 Investmentestablishment
Guiyang MeilingApplianceMarketingCo.,Ltd.20) Guiyang Guiyang Sales 86.00 Investmentestablishment
Fuzhou MeilingApplianceMarketingCo., Ltd.21) Fuzhou Fuzhou Sales 99.00 Investmentestablishment
NanjingMeilingApplianceMarketingCo., Ltd.22) Nanjing Nanjing Sales 99.00 Investmentestablishment
Hefei MeilingWhiteApplianceMarketing Co., Ltd.23) Hefei Hefei Sales 95.00 Investmentestablishment
Taiyuan MeilingApplianceMarketingCo., Ltd.24) Taiyuan Taiyuan Sales 95.00 Investmentestablishment
198
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Share-helding ratio
Registration Business (%)
Subsidiary Business area Acquire way
place nature Indirectl
Directly
y
ChangshaMeilingApplianceMarketingCo., Ltd.25) Changsha Changsha Sales 97.00 Investmentestablishment
HohhotMeilingApplianceMarketingCo., Ltd.26) Hohhot Hohhot Sales 95.00 Investmentestablishment
HangzhouMeilingApplianceMarketing Co., Ltd.27) Hangzhou Hangzhou Sales 95.00 Investmentestablishment
ChongqingMeilingApplianceMarketingCo., Ltd.28) Chongqing Chongqing Sales 98.00 Investmentestablishment
KunmingMeilingApplianceMarketingCo.,Ltd.29) Kunming Kunming Sales 95.50 Investmentestablishment
ShanghaiMeilingApplianceMarketing Co.,Ltd.30) Shanghai Shanghai Sales 99.00 Investmentestablishment
NantongMeilingApplianceMarketingCo.,Ltd.31) Nantong Nantong Sales 92.00 Investmentestablishment
Guangzhou MeilingApplianceMarketingCo., Ltd.32) Guangzhou Guangzhou Sales 98.00 Investmentestablishment
TianjinMeilingApplianceMarketing Co., Ltd.33) Tianjin Tianjin Sales 100.00 Investmentestablishment
UrumchiMeilingApplianceMarketingCo., Ltd.34) Urumchi Urumchi Sales 90.00 Investmentestablishment
Harbin MeilingApplianceMarketingCo., Ltd.35) Harbin Harbin Sales 95.00 Investmentestablishment
BeijingMeilingApplianceMarketing Co., Ltd.36) Beijing Beijing Sales 99.00 Investmentestablishment
Lanzhou MeizhilaiApplianceMarketingCo., Ltd.37) Lanzhou Lanzhou Sales 72.00 Investmentestablishment
Xi’an MeizhilaiApplianceMarketingCo., Ltd.38) Xi’an Xi’an Sales 98.50 Investmentestablishment
Hefei Hefei Meiling Non-ferrous Metal Product Co., Manufactures, Enterprise combined not under the
Hefei Hefei 100.00
Ltd.39) sales same control
Manufactures, Enterprise combined not under the
Hefei HefeiMeilingPackagingProductsCo.,Ltd,40) Hefei Hefei 48.28 51.72
sales same control
ChanghongRubaTradingCompany41) Pakistan Pakistan Sales 60.00 Investmentestablishment
Manufactures, Enterprise combined under the
Sichuan ChanghongAirConditionerCo., Ltd.42) Mianyang Mianyang 100.00
sales same control
Manufactures, Enterprise combined under the
Zhongshan ChanghongApplianceCo., Ltd43) Zhongshan Zhongshan 90.00 10.00
sales same control
Manufactures, Enterprise combined not under the
Hefei Meiling Group HoldingCo., Ltd.44) Hefei Hefei 100.00
sales same control
Manufactures, Enterprise combined not under the
MeilingEquatorElectric(Hefei)Co., Ltd. 45) Hefei Hefei 100.00
sales same control
Manufactures, Enterprise combined not under the
Hefei Equator ElectricCo., Ltd. 46) Hefei Hefei 100.00
sales same control
Hongyuan Earth Energy Heat Pump Technology Co. Manufactures,
Mianyang Mianyang 51.00 Investmentestablishment
Ltd.47) sales
Manufactures, Enterprise combined under the
GuangdongChanghongRidianTechnologyCo. Ltd.48) Zhongshan Zhongshan 98.856
sales same control
199
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Share-helding ratio
Registration Business (%)
Subsidiary Business area Acquire way
place nature Indirectl
Directly
y
R &D,
ChangmeiTechnologyCo. Ltd.49) Mianyang Mianyang manufacturing, 90.00 Investmentestablishment
sales
Note:
1)Zhongke Meiling Low Temperature Technology Company Limited (hereinafter referred to as
―Zhongke Meiling‖), the predecessor of which was Zhongke Meiling Low Temperature Technology Limited
Liability Company, was established on 29 October 2002 by joint contribution from the Company and
Technical Institute of Physics and Chemistry, CAS (―TIPC‖), with registered capital of RMB60 million upon
the establishment, among which, the Company made capital contribution of RMB42 million (including the
assets in specie at the consideration of RMB35,573,719.70 as evaluated by Beijing Zhongzheng Appraisal
Co., Ltd. with issuance of the Appraisal Report (ZZPBZ(2002)No.029) and cash contribution of
RMB6,426,280.30) accounting for 70% of the aforesaid registered capital, and TIPC made capital
contribution of RMB18 million with intangible assets of such value (namely the single compressor mixture
industrial low temperature refrigeration technology) as evaluated by Jingzhongzi Assets Appraisal Co., Ltd.
with issuance of the Appraisal Report (ZZPBZ(2002)No.225) accounting for 30% of the aforesaid registered
capital. The paid-in of the above registered capital has been verified by Huazheng Accounting Firm by
issuance of the Assets Verification Report (HZYZ (2002) No.B157) dated 16 October 2002.
In October 2014, according to the relevant provision under the Management Rules on Application of
State Owned Assets by Central Business Organs, TIPC transferred the 30% equity interests held by it in
Zhongke Meiling Low Temperature Technology Company Limited to its wholly-owned subsidiary Zhongke
Xianxing (Beijing) Assets Management Co., Ltd (―Zhongke Xianxing‖) which would perform management
over the operating assets of TIPC. Upon consideration and approval at the 37th meeting of the 7th Board of
Directors of Hefei Meiling Co., Ltd, it is agreed to waive the pre-emptive right.
On 10 August 2015, all the founders signed the Founder Agreement of Zhongke Meiling Low
Temperature Technology Company Limited, pursuant to which, they decided to change the firm type of
Zhongke Meiling Low Temperature Technology Company Limited to a joint stock company. Based on the
net assets of RMB 96,431,978.25 as audited by Xinyong Zhonghe CPA as of 30 June 2015, an aggregate of
65,000,000 shares have been converted at the proportion of 1:0.67, which are to be held by the original
shareholders according to their respective entitlement. In case that the net assets exceed registered capital, the
balance shall be recorded in capital reserve. On 28 August 2015, Xinyong Zhonghe CPA reviewed the
registered capital and paid-in thereof in respect of the stock reform, and issued Assets Verification Report
(XYZH/2015CDA40161). The Company registered industrial and commercial information on 11 September
2015.
2) Mianyang Meiling Software Technology Co., Ltd. (hereinafter referred to as Meiling Software
200
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Company) was established on Jan. 24, 2014. It is a limited company jointly invested by the Company and
Mianyang Meiling Refrigeration Co., Ltd., being approved by the Industial and Commerce Bureau of
Peicheng Distric, Mianyang City. The company owes registered capital of RMB 5 million, including RMB
4.95 million contributed by Meiling Company in cash, accounted for 99% of the registered capial; Mianyang
Meiling Refrigeration Co., Ltd. contributed RMB 50000 in cash with 1% of the registed capital occupied.
The above mentioned register capital have been verified by verification report of Chuanjinlai Yanzi No.[2014]
B039 issued by Sichuan Jinlai Accounting Firm Co., Ltd.
3) Mianyang Meiling Refrigeration Co., Ltd. (hereinafter referred to as Mianyang Meiling Company), a
limited liability company jointly set up by the Company and China-tech Meiling Company, was founded on
Mar. 6, 2009. Its registered capital and paid-in capital was RMB 50 million upon establishment, of which, the
Company invested RMB 45 million, accounting for 90% of the registered capital; Zhongke Meiling
Company invested RMB 5 million, accounting for 10% of the registered capital. The capital receipt was
verified by the verification report [CXKY (2009) No. 008] of Sichuan Xingrui Certified Public Accountants.
On 19 January 2011, the Company increase RMB 50 million in capital of Mianyang Meiling, of which RMB
95 million invested by the Company, a 95% of total register capital while RMB 5 million invested by
Zhongke Meiling, a 5% of total capital occupied. The paid-in capital has been verified by Capital Verification
Report ［XYZH/2010CDA6040］from Chengdu Branch of Shinewing CPA CO., Ltd. In 2011, Zhongke
Meiling entered into ―Equity Transfer Agreement‖ with Jiangxi Meiling Refrigeration Co., Ltd. 5 percent
equity of Mianyang Meiling held by Zhongke Meiling was transferred to Jiangxi Meiling Refrigerator. In
September 2013, Jiangxi Meiling Refrigeration was combined by Jiangxi Meiling Appliance Co., Ld, than 5
percent equity was transfer to Jiangxi Meiling Appliance.
4) Jiangxi Meiling Appliance Co., Ld.( hereinafter referred to as Jiangxi Meiling Appliance Co.,) was a
limited liability company jointly established by the Company and Mianyang Meiling on 23 May 2011.
Register capital of the company totally as RMB 50 million, RMB 49.375 million invested by the Company,
98.75% in total register capital while RMB 0.625 million invested by Mianyang Meiling , a 1.25% in total
register capital occupied. The initial investment RMB 10.50 million was received dated 13 May 2011 with
RMB 10 million from the Company and RMB 0.5 million from Mianyang Meiling. Rest of the capital shall
be invested fully within 2 years after the joint ventures established according to capital requirement. The
initial investment capital were verified by the Capital Verification Report [JXKYZi(2011) No. 090] issued
from Jingdezhen Xingci CPA Co., Ltd. Second capital RMB 39.5 million was fully funded on 28 July 2011,
the Company contributed RMB 39.375 million while Mianyang Meiling Company invested RMB 125,000,
the contributions have been verified by the capital verification report [Jing Xing Kuai Yan Zi (2011) No.: 134]
issued from JDZ Xingci CPA Co., Ltd.
5) Hefei Meiling Appliance Marketing Co., Ltd. (Meiling Marketing Company for short) is the limited
company jointly invested by the Company and Mianyang Meiling Company on 21 Oct. 2009. Registered
capital and paid-up capital was RMB 10 million, including RMB 9.9 million invested by the Company, a
99% of the registered capial; Mianyang Meiling Company contributed RMB 0.1 million, a 1% of the
registered capial. The above mentioned paid-up register capital have been verified by verification report of
201
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
[Wan An Lian Xin Da Yan Zi (2009) No. 074] issued by Anhui An Lian Xin Da Accounting Firm Co., Ltd.
On 25 Nov. 2010, the Compan increased capital RMB 45 million, registered capital amounting to RMB 55
million, including RMB 54.9 million contributed by the Company, a 99.82% of the registered capial, while
Mianyang Meiling invested RMB 0.1 million, a 0.18% of the registered capial. The increased capital have
been verified by verification report of [Wan Hua Shen Zheng Da Kuai Yan Zi (2010) No. 1514] issued by
Anhui Hua Shen Zhengda CPA Co., Ltd.
6) Guangxi Huidian Home Appliance Co., Ltd. (Guangxi Huidian for short) established in March 2010
with registered capital of RMB 5 million. The Company invested RMB 1 million, accounted for 20% of the
registered capital; Meiling Marketing acquired 44% equity interests from the minority shareholders in 2014.
In 2015, Meiling Marketing and Jiangxi Meiling Appliances entered into equity transfer agreements with
minority shareholders respectively, to acquire as the transferees the 35.6% and 0.4% equity interests of
Guangxi Weidian held by minority shareholders. Upon completion of equity transfer in April 2015, Meiling
Marketing and Jiangxi Meiling Appliances held the entire equity interests of Guangxi Weidian as a whole.
7) Luohe Meiling Appliance Marketing Co., Ltd. (Luohe Meiling for short) was established dated 10
December 2010 with registered capital of RMB 5 million. The Company invested RMB 1.85 million,
accounted for 37% of the registered capital. In 2013, Meiling Marketing purchased minority equity of 27%;
in 2014, Meiling Marketing purchased minority equity of 35.6%; Jiangxi Meiling Marketing signed equity
transfer agreement with the minority shareholders in 2015, to acquire as the transferee the 0.4% equity
interests of Luohe Meiling held by minority shareholders. Upon completion of such equity transfer, Meiling
Marketing and Jiangxi Meiling Appliances held in aggregate the entire equity interests of Luohe Meiling.
8) Wuhu Meiling Appliance Marketing Co., Ltd. (Wuhu Meiling for short) was established dated 24
December 2010 with registered capital of RMB 6 million; the Company invested RMB 2.16 million,
accounted for 36% of the registered capital. After Meiling Marketing acquired 65% equity interests from the
minority shareholders in 2014, Meiling Marketing the Company totally holds 98% equity of the Wuhu
Meiling.
9) Changchun Meiling Appliance Marketing Co., Ltd. (Changchun Meiling for short) was established
dated 22 December 2010 with registered capital of RMB 3million; Meiling Marketing invested RMB 2.91
million, accounted for 97% of the registered capital.
10) Bengbu Meiling Appliance Marketing Co., Ltd. (Bengbu Meiling for short) was established dated
27 December 2010 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.55 million,
accounted for 85% of the registered capital. In 2013, Meiling Marketing purchased 2.4% equity from the
minority; and entered into equity transferred agreement with minority shareholders in 2014, transferred 6.1%
equity of Bengbu Meiling held by the minority respectively, after equity transferred completed in December
2014, Meiling Marketing totally holds 93.5% equity of the Bengbu Meiling.
11) Jinan Meiling Appliance Marketing Co., Ltd. (Jinan Meiling for short) was established dated 3 June
2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million, accounted for
36% of the registered capital; after Meiling Marketing acquired 55.4% equity interests from the minority
shareholders in 2015, Meiling Marketing totally holds 91.4% equity of the Jinan Meiling.
202
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
12) Nanchang Xiangyou Appliance Marketing Co., Ltd. (Nanchang Xiangyou for short) was established
dated 5 January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million,
accounted for 36% of the registered capital. After the Company acquired 49% equity interests from the
minority shareholders in 2014, Meiling Marketing totally holds 85% equity of Nanchang Xiangyou.
13) Jingzhou Meiling Appliance Marketing Co., Ltd. (Jingzhou Meiling for short) was established dated
10 January 2011 with registered capital of RMB 4 million; Meiling Marketing invested RMB 2.4 million,
accounted for 60% of the registered capital. In 2013, the Company purchased 20% equity from minority;
After Meiling Marketing acquired 1% equity interests from the minority shareholders in 2014, and Meiling
Marketing acquired 15% equity interests from the minority shareholders in 2016, Meiling Marketing totally
holds 96% equity of Jingzhou Meiling.
14) Shenyang Meiling Appliance Marketing Co., Ltd. (Shenyang Meiling for short) was established
dated 26 January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.844
million, accounted for 94.8% of the registered capital. After Meiling Marketing acquired 3.8% equity
interests from the minority shareholders in 2016, Meiling Marketing totally holds 98.6% equity of Shenyang
Meiling.
15) Wuhan Meizhirong Appliance Marketing Co., Ltd. (Wuhan Meizhirong for short) formerly known
asWuhan Meiling Appliance Marketing Co., Ltd. was established dated 10 January 2011 with registered capital
of RMB 5 million; Meiling Marketing invested RMB 4.55 million, accounted for 91% of the registered
capital.
16) Zhengzhou Meiling Appliance Marketing Co., Ltd. (Zhengzhou Meiling for short) was established
dated 17 January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million,
accounted for 36% of the registered capital. In 2013, Meiling Marketing purchased 10% equity from
minority; In April 2015, Meiling Marketing purchased 39% equity from minority; In Feburary 2016, Meiling
Marketing purchased 10% equity from minority; upon completion of such equity transfer, Meiling Marketing
held in aggregate the 95% equity interests of Zhengzhou Meiling.
17) Shijiazhuang Meiling Appliance Marketing Co., Ltd. (Shijiazhuang Meiling for short) was
established dated 14 January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB
1.08 million, accounted for 36% of the registered capital; After Meiling Marketing acquired 27.33% equity
held by the minority in 2014; Meiling Marketing acquired 32% equity held by the minority in 2015; upon
completion of such equity transfer, Meiling Marketing held in aggregate the 95.33% equity interests of
Shijiazhuang Meiling.
18) Mianyang Meiling Appliance Marketing Co., Ltd. (Mianyang Meiling for short) was established
dated 27 January 2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 2.6 million,
accounted for 52% of the registered capital. After Meiling Marketing purchased 33% equity from minority in
2013, and purchased 8.8% equity from minority in 2015, Meiling Marketing totally holds 93.8% equity of
Mianyang Meiling.
19) Chengdu Meiling Appliance Marketing Co., Ltd. (Chengdu Meiling for short) was established dated
26 January 2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 4.17 million,
203
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
accounted for 83.4% of the registered capital; After Meiling Marketing purchased 1.6% equity from minority
in 2014, and purchased 9% equity from minority in 2015, Meiling Marketing totally holds 94% equity of
Chengdu Meiling.
20) Guiyang Meiling Appliance Marketing Co., Ltd. (Guiyang Meiling for short) was established dated
24 January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 0.78 million,
accounted for 26% of the registered capital; In 2013, Meiling Marketing purchased 18% equity from
minority; In 2015, Meiling Marketing purchased 42% equity from minority; Upon completion of such equity
transfer, Meiling Marketing held in aggregate the 86% equity interests of Guiyang Meiling.
21) Fuzhou Meiling Appliance Marketing Co., Ltd. (Fuzhou Meiling for short) was established dated 25
January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million,
accounted for 99% of the registered capital.
22) Nanjing Meiling Appliance Marketing Co., Ltd. (Nanjing Meiling for short) was established dated
14 Feb. 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million,
accounted for 99% of the registered capital.
23) Hefei Meiling White Appliance Marketing Co., Ltd. (White Appliance for short) was established
dated 21 January 2011 with registered capital of RMB 6 million; Meiling Marketing invested RMB 5.1 million,
accounted for 85% of the registered capital; In 2015, Meiling Marketing purchased 10% equity from minority,
upon completion of such equity transfer, Meiling Marketing held in aggregate the 95% equity interests of
White Appliance.
24) Taiyuan Meiling Appliance Marketing Co., Ltd. (Taiyuan Meiling for short) was established dated
18 January 2011 with registered capital of RMB 4 million; Meiling Marketing invested RMB 1.59 million,
accounted for 39.75% of the registered capital; In 2013 Meiling Marketing purchased 45.5% equity from
minority, after in 2016 Meiling Marketing purchased 9.75% equity from minority, Meiling Marketing totally
holds 95% equity of the TaiyuanMeiling.
25) Changsha Meiling Appliance Marketing Co., Ltd. (Changsha Meiling for short) was established
dated 26 January 2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 1.8 million,
accounted for 36% of the registered capital; In 2014 Meiling Marketing purchased 50% equity from minority,
after in 2016 Meiling Marketing purchased 11% equity from minority, Meiling Marketing totally holds 97%
equity of Changsha Meiling.
26) Hohhot Meiling Appliance Marketing Co., Ltd. (Hohhot Meiling for short) was established dated 21
Feb. 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.65 million, accounted
for 55% of the registered capital; In 2013, after Meiling Marketing purchased 28% equity from minority, in
2016, Meiling Marketing purchased 12% equity from minority, Meiling Marketing totally holds 95% equity
of the Hohhot Meiling.
27) Hangzhou Meiling Appliance Marketing Co., Ltd. was established dated 17 Feb. 2011 with registered
capital of RMB 3 million; Meiling Marketing invested RMB 2.655 million, accounted for 88.5% of the
registered capital; in 2015, Meiling Marketing purchased 6.5% equity from minority, upon completion of
such equity transfer, Meiling Marketing held in aggregate the 95% equity interests of Hangzhou Meiling.
204
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
28) Chongqing Meiling Appliance Marketing Co., Ltd. (Chongqing Meiling for short) was established
dated 1 March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.55 million,
accounted for 85% of the registered capital; After Meiling Marketing purchased 13% equity from minority in
2015, Meiling Marketing totally holds 98% equity of Chongqing Meiling.
29) Kunming Meiling Appliance Marketing Co., Ltd. (Kunming Meiling for short) was established
dated 28 Feb. 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.395 million,
accounted for 46.5% of the registered capital; In 2013, after Meiling Marketing purchased 40% equity from
minority, In 2016 Meiling Marketing purchased 9% equity from minority, Meiling Marketing totally holds
95.5% equity of the Kunming Meiling.
30) Shanghai Meiling Appliance Marketing Co., Ltd. (Shanghai Meiling for short) was established dated
9 March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million,
accounted for 99% of the registered capital.
31) Nantong Meiling Appliance Marketing Co., Ltd. (Nantong Meiling for short) was established dated
8 March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.74 million,
accounted for 58% of the registered capital; In 2013, after Meiling Marketing purchased 34% equity from
minority, Meiling Marketing totally holds 92% equity of the Nantong Meiling.
32) Guangzhou Meiling Appliance Marketing Co., Ltd. (Guangzhou Meiling for short) was established
dated 13 May 2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 4.3 million,
accounted for 86% of the registered capital; after Meiling Marketing acquired 12% equity interests from the
minority shareholders in 2014, Meiling Marketing totally held the 98% equity interests of Guangzhou
Meiling.
33) Tianjin Meiling Appliance Marketing Co., Ltd. (Tianjin Meiling for short) was established dated 2
March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.565 million,
accounted for 85.5% of the registered capital; In 2015, Meiling Marketing and Jiangxi Meiling Appliances
entered into equity transfer agreements with minority shareholders respectively, to acquire as the transferees
the 14.1% and 0.4% equity interests of Guangxi Weidian held by minority shareholders. Upon completion of
equity transfer in December 2015, Meiling Marketing totally held the entire equity interests of Tinjian
Meiling.
34) Urumchi Meiling Appliance Marketing Co., Ltd. (Urumchi Meiling for short) was established dated
4 March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.7 million,
accounted for 90% of the registered capital.
35) Harbin Meiling Appliance Marketing Co., Ltd. (Harbin Meiling for short) was established dated 6
April 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million,
accounted for 36% of the registered capital; Meiling Marketing acquired 41.5% equity interests from the
minority shareholders in 2014, Meiling Marketing acquired 17.5% equity interests from the minority
shareholders in 2015, Meiling Marketing totally held the 95% equity interests of Harbin Meiling.
36) Beijing Meiling Appliance Marketing Co., Ltd. (Beijing Meiling for short) was established dated 28
March 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million,
205
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
accounted for 99% of the registered capital.
37) Lanzhou MeizhilaiAppliance Marketing Co., Ltd. (Lanzhou Meizhilai for short) formerly known as
Lanzhou Meiling Appliance Marketing Co., Ltd. was established dated 25 March 2011 with registered capital
of RMB 3 million; Meiling Marketing invested RMB 1.215 million, accounted for 40.50% of the registered
capital; In 2013, after Meiling Marketing purchased 11% equity from minority, in 2016 Meiling Marketing
purchased 20.5% equity from minority, Meiling Marketing totally holds 72% equity of the Lanzhou
Meizhilai.
38) Xi’an Meizhilai Appliance Marketing Co., Ltd. (Xi’an Meiling for short) formerly known as Xi’an
Meiling Appliance Marketing Co., Ltd.was established dated 13 April 2011 with registered capital of RMB 3
million; Meiling Marketing invested RMB 1.83 million, accounted for 61% of the registered capital; Meiling
Marketing acquired 24% equity interests from the minority shareholders in 2014, Meiling Marketing
acquired 13.5% equity interests from the minority shareholders in 2015, Meiling Marketing totally held the
98.5% equity interests of Xi’an Meizhilai.
39) Hefei Meiling Nonferrous Metal Products Co., Ltd. (hereinafter referred to as Nonferrous Metal) was
the Sino-foreign joint venture jointly set up by original Meiling Group, Hefei Meiling Copper Co., Ltd. And Singapore
Kim Shin Development Co., Ltd., which have been originally approved by the [WJMWFZZ(1996) No.349] of
Foreign Trade and Economic Committee of Anhui Province. Its registered capital was US$ 2.92 million upon
establishment, of which, original Meiling Group invested US$ 1.46 million (monetary capital), accounting
50% of the registered capital, Hefei Meiling Copper Co., Ltd invested US$ 0.584 million (monetary capital of RMB
0.18 million and real assets of US$ 0.404 million), accounting 20% of registered capital while Singapore Kim Shin
Development Co., Ltd invested US$ 0.876 million (monetary capital), accounting 30% of the registered capital.
The above mentioned investment verified by the verification report of [HSWZ(1995) No. 0737],
[HSWZ(1996) No. 328] and [HSWZ(1998) No. 088] from Anhui CPAs Co., Ltd. In July 2008, approved by
[HWS(2008) No.53] from Foreign Trade Economic Cooperation Bureau of Hefei City, 30% equity and 20%
equity held by Singapore Kim Shin Development Co., Ltd and Hefei Meiling Copper Co., Ltd respectively
transferred to original Meiling Group Totally. The Company’s register capital came into RMB 24,286,808.00
after transference, and was not the joint-venture any more.
40) Hefei Meiling Packing Products Co., Ltd. (hereinafter referred to as Packing Products) was the
Sino-foreign joint venture jointly set up by Hefei Paper Box Plant, original Meiling Group and Singapore Anda
Development Co., Ltd in December 1993, which approved by [HWJZ(1993) No. 0444] of Foreign Trade and
Economic Committee of Hefei City with its register capital of US$ 3.067 million. The register capital while
established have been verified by [HKHY(1995) No. 5] from original Hefei CPAs Co., Ltd. On December 30,
2002, being approved by [HWJ(2002) No. 259] of foreign trade Economic Cooperation Bureau of Hefei City,
48.28% equity owned by Hefei Paper Box Plant transferred to the Company. On June 17, 2005, 25% equity
owned by Singapore Anda Development Co., Ltd transferred to original Meiling Group freely by one-time. The
Company turned into domestic-capital enterprise from foreign-capital enterprise with changed registered capital of RMB
18.4 million. The re-register of register capital being verified by [WCQYZ(2005) No. 256] from Anhui
CHengqin CPAs Co., Ltd. After equity transferred, the Company invested RMB 8.88 million accounting
206
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
48.28% in register capital while Meiling Group invested RMB9.52 million with 51.72% in register capital.
Resolution from the 46th meeting of 6th session of the Board, while purchasing Meiling Group, the assets and
liabilities of Meiling Packaging Products Co., Ltd., which are not included in transfer-in assets, will derivate
into the Hefei Xingmei Assets Management Co., Ltd., the former Meiling Packaging Products Co. reduced its
capital as RMB 17.4 million, and registered changed for industrial and commerce have completed on 27 June
2011.
41) Changhong Ruba Trading Company (Private) Limited (hereinafter referred to as ―Changhong Ruba‖)
was a joint venture established by Zhongshan Changhong Appliances Company Limited and RUBA
GENERAL TRADING FZE Company (―RUBA‖) on 5 August 2011 with the approval from Guangdong
Development and Reform Commission by issuance of the Approval Relating to Joint Construction of a
Manufacturing and Selling Platform Project in Pakistan by Zhongshan Changhong Appliances Company
Limited (YFGWZ(2011)958). The registered capital of the joint venture is USD6 million, among which,
USD3.6 million is contributed by Zhongshan Changhong Appliances in cash with shareholding proportion of
60%, and the remaining USD2.4 million is contributed by RUBA in cash with shareholding proportion of
40%.
42) Sichuan Changhong Air-conditioners Co., Ltd.(Changhong Air-conditioner for short), a limited
liability company jointly set up by Sichuan Changhong and Changhong Chuangtou, was founded on
November 28, 2008. Its registered capital was RMB 200 million upon establishment, of which, Sichuan
Changhong invested RMB 298 million (RMB 210,088,900 invested by monetary capital while RMB
87,911,100 invested by real material), equivalent to RMB 198 million shares, accounting for 99% of the
registered capital; and Changhong Chuangtou invested RMB 3 million, accounting for 1% of the registered
capital with equivalent of RMB 2 million shares. The registered capital receipt was verified by the
verification report [CGYYZ (2008) No. 177] of Sichuan Guangyuan Certified Public Accountants Co., Ltd.
and [HLTHYZ(2008) No. 12-006] of Sichuan Henglitai Certified Public Accountants Co., Ltd. In December
2009, the Company obtained 100% equity of Changhong Air-conditioner by consolidated under the same
control.
43) Zhongshan Changhong Electric Co., Ltd.( hereinafter referred to as Zhongshan Changhong), was
the original Guangdong Changhong Electric Co., Ltd., and is a limited liability company jointly set up by
Sichuan Changhong and China Minmetals on May 22, 2001. Its registered capital was RMB 80 million upon
establishment, of which, Sichuan Changhong invested RMB 72 million, including RMB 69.3 million biding
for the estate/ non-estate from original Zhongshan Sanrong Air-conditioner Co., Ltd. And its patent use-right
of RMB2.7 million, accounting for 90% of the registered capital; Chine Minmetals invested RMB 8 million
in monetary capital accounting 10% of the registered capital. The Company changed its name originally from
Guangdong Changhong Electric Co., Ltd in July 2003. In December 2009, the Company obtained 90%
equity of Zhongshan Changhong by consolidated under same control. 10% equity held by China Minmetals
has been transferred by Changhong Air-conditioner on April 11, 2010. On 25 May 2014, the Company
increased RMB 36 million to Zhongshan Changhong, and Changhong AC increased RMB 4 million. After
capital increased, registered capital of Zhongshan Changhong turns to RMB 120 million, including RMB 108
207
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
million contributed by the Company, accounted for 90% of the registered capital, Changhong AC invested
RMB 12 million, accounted for 10% of the registered capital. On 2 June 2016, the Company increased RMB
57.60 million to Zhongshan Changhong, and Changhong AC increased RMB 6.4 million. After capital
increased, registered capital of Zhongshan Changhong turns to RMB 184 million, including RMB 165.6
million contributed by the Company, accounted for 90% of the registered capital, Changhong AC invested
RMB 18.4 million, accounted for 10% of the registered capital.
44) Hefei Meiling Group Holding Co., Ltd (Meiling Group), was the state-owned company originally approved
by People’s Government of Hefei Province and established authorized by SASAC of Hefei City. On July 14, 2008,
100% state-owned equity of Meiling Group has freely transferred to Xingtai Holding by Hefei SASAC.
Agreement by the approval of < State-owned property agreement transfer from Meiling Group>
[ HGZCQ(2010) No.34] of Hefei SASAC on April 9, 2010, 100% state-owned property of Meiling Group
after partial assets and liabilities separated transferred to the Company from Xingtai Holding as amount of
RMB 113.2 million. The re-registration of industrial and commercial procedure for Meiling Group after
separated partial assets liability has finished on July 28, 2010. The new Meiling Group has register capital of
RMB 80 million, and have been verified by the [AD(2010)YZD No. 016] from Anhui Anding CPAs Co., Ltd.
45) Meiling Equator Appliance (Hefei) Co., Ltd.( Equator Appliance for short) was the Sino-foreign joint venture
jointly set up by original Meiling Group and EQUATOR INVESTMENTS (USA) INC.( EQUATOR for short),
which have been approved by the [SWZWFZZ(2004) No.0103] of Approval Certificate of Foreign Enterprise
from People’s Government of Anhui Province. Its registered capital was US$ 3 million upon establishment,
of which, Sino company invested US$ 2.25 million in machinery equipment, accounting 75% of the
registered capital while foreign company invested US$ 0.5 million in monetary capital and US$ 0.25 million
in intangible assets, amounting to US$0.75 million, accounting 25% of the registered capital. The above
mentioned investment verified by the verification report of [WYAYZ (2004) No. 135] from Anhui Yongan
CPAs Co., Ltd. In July 2007, approved by [HWJ(2007) No.136] from Foreign Trade Economic Cooperation
Bureau of Hefei City, 25% equity held by EQUATOR transferred to Anhui Meiling Electric Co., Ltd. Totally.
The Company’s register capital came into RMB 24,793,200 after transference, and was not the joint-venture
any more. 25% equity owned by Anhui Meiling Electric Co., Ltd has been transferred totally to original
Meiling Group in July 2009.
46) Hefei Equator Appliance Co., Ltd.( Equator Appliance) was jointly set up by original Meiling Group and
Yingkaite Appliance on September 26, 2007. Its register capital was RMB 12 million, among which, original
Meiling Group invested RMB 8,670,600 in monetary capital, accounting 72.255% in registered capital;
Equator Appliance invested RMB 3,329,400 in the assessment value of intangible assets (land-use right),
accounting 27.745% of total registered capital. The investment being verified by [WYAZ(2004) No. 135]
from Anhui Yongan CPAs Co., Ltd.
47) Hongyuan Ground Energy Heating Pump Technology Company (hereinafter referred to as
―Hongyuan Ground Energy‖) was established as a limited liability company with joint capital contribution
from Sichuan Changhong Air Conditioner Company (―Changhong Air Conditioner‖) and Hengyouyuan
Science & Technology Development Group on 28 August 2015, with the approval from the Industrial and
208
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Commercial Administration Office of Fucheng district, Mianyang, Sichuan province. The registered capital
of the company is RMB50 million, among which, RMB25.5 million is contributed by Changhong Air
Conditioner in cash with shareholding proportion of 51%, and the remaining RMB24.5 million is contributed
by Hengyouyuan Science & Technology Development Group in cash with shareholding proportion of 49%.
48) Guangdong Changhong Ridian Technology Co., Ltd. (hereinafter referred to as Changhong Ridian),
formerly Guangdong Changhong Digital Technology Co., LTd., was a Limited Liability Company
established by Sichuan Changhong Electric Co., Ltd. (hereinafter referred to as Sichuan Changhong) and
Sichuan Changhong Motor Transport Co., Ltd. (hereinafter referred to as Changhong Motor Transport) on 25
May 2006. Registered capital and paid-up capital both amounting as RMB 40 million; Sichuan Changhong
contributes RMB 32 million, representing 80% of the registered capital while Changhong Motor Transport
contributes RMB 8 million, representing 20% of the registered capital. On 4 January 2007, the Company
increased RMB 43 million for the registered capital, including RMB 1.8 million invested by Sichuan
Changhong, RMB 40 million contributed by Guangdong Xiongfeng Electric Co., LTd. (hereinafter referred
to as Guangdong Xiongfeng) and RMB 1.2 million contributed by 10 natural shareholders including Kou
Huameng. At the same time, according to the resolution of the shareholdes meeting, the RMB 8 million
capital invested by Changhong Motor Transport are agreed to transferred to Sichuan Changhong Innovation
Investment Co., Ltd. (hereinafter referred to as Changhong Innovation Investment), after capital increment,
the registered capital structure are comes to: Sichuan Changhong contributed RMB 33.8 million, takes
40.72%; Guangdong Xiongfeng invested RMB 40 million, takes 48.19%; Changhong Innovation Investment
contributed RMB 8 million, takes 9.64% and 10 natural shareholders including Kou Huameng contributed
RMB 1.2 million, takes 1.45%. On 18 Feb. 2009, totally 7 natural person shareholders transferred the 0.76%
equity to Hu Zhiheng. And the company re-named as Guangdong Changhong Ridian Technology dated 31
May 2013. Kou Huameng, who takes 0.301% equity of the registered capital, are transfer the equity to
Changhong Innovation Investment on 9 October 2014. Guangdong Xiongfeng transfers all 48.19% equity to
Sichuan Changhong on 11 Dec. 2014. On 4 Jan. 2016, Sichuan Changhong and Changhong Innovation
Investment respectively entered into the ―Equity Transfer Agreement of Guangdong Changhong Ridian
Technology Co., Ltd.‖ with Hefei Meiling Co., Ltd. (hereinafter referred to as Hefei Meiling). According to
the agreement, the 88.92% equity of the company held by Sichuan Changhong are transferred by Hefei
Meiling with price of RMB 86.0324 million, and 9.94% equity of the company held by Changhong
Innovation Investment are transferred with price of RMB 9.6176 million. Registered capital structure after
changed comes to: Hefei Meiling contributes RMB 82.0505 million, takes 98.856% while minority
shareholders contributes RMB 0.9495 million, representing 1.144%.
49) Changmei Technology Co., Ltd. (hereinafter referred to as Changmei Technology) was a Limited
Liability Company established by Hefei Meing Co., Ltd. and management team members (23 person in total)
on 1 April 2016 with registered capital of RMB 50 million; including RMB 45 million contributed by
Meiling, representing 90% of the registered capital while management team contributed RMB 5 million, a
10% of the registered capital. The first payment of the contribution from Meiling and management team
amounting to 40%, rests of the capital will paid in all within 3 years since the company established.
209
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(2) Major non-wholly-owned subsidiary
Dividend
Gains/losses Balance of
Shareholdi distributed to
attributable to minority’s
Subsidiary ng of minority
minority in the interest at
minority announced in the
Year period-end
Year
ZhongkeMeilingCryogenicTechnologyCo., Ltd.. 30.00% 645,469.93 292,500.00 30,643,826.42
GuangdongChanghongRidianTechnologyCo., Ltd. 1.144% 34,715.16 1,085,518.01
Hongyuan Ground Energy Heating Pump
49.00% -391,329.71 9,080,298.31
Technology Company
(3) Financial information for major non-wholly-owned subsidiary
Ending balance
Subsidiary Non-current
Current assets Non-current assets Total assets Current liabilities Totalliabilities
liability
Zhongke
97,318,680.97 46,702,066.47 144,020,747.44 36,874,659.38 5,000,000.00 41,874,659.38
Meiling
ChanghongRidian 128,237,199.29 60,639,892.76 188,877,092.05 93,989,154.00 - 93,989,154.00
Hongyuan
Ground 61,441,258.45 599,795.43 62,041,053.88 43,509,832.84 - 43,509,832.84
Energy
(Continued)
Balance atperiod-begin
Subsidiary Non-current
Current assets Non-current assets Total assets Current liabilities Totalliabilities
liability
Zhongke
110,871,612.72 23,171,786.54 134,043,399.26 28,073,877.64 5,000,000.00 33,073,877.64
Meiling
ChanghongRidian 111,208,245.86 62,080,855.26 173,289,101.12 81,435,705.12 81,435,705.12
Hongyuan
Ground 25,708,356.81 45,480.97 25,753,837.78 16,423,984.68 - 16,423,984.68
Energy
(Continued)
Amount in the year
Subsidiary Total comprehensive Cash flow from
Operation income Net profit
income operation activity
Zhongke
38,908,381.02 2,151,566.44 2,151,566.44 6,169,648.52
Meiling
210
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Subsidiary Amount in the year
ChanghongRidian 222,027,059.04 3,034,542.05 3,034,542.05 27,949,640.51
Hongyuan
Ground 34,314,113.36 -798,632.06 -798,632.06 -926,619.14
Energy
(Continued)
Amount in last year
Subsidiary Total comprehensive Cash flow from
Operation income Net profit
income operation activity
Zhongke
42,750,432.40 2,320,689.88 2,320,689.88 -1,782,467.56
Meiling
ChanghongRidian 151,580,514.58 -213,726.49 -213,726.49 8,962,222.71
Hongyuan
Ground
Energy
(4) Major limitation on using enterprise group’s assets and liquidate debts of enterprise group: Nil
(5) Offering financial supporting or other supports for structured entity that included in consolidation
statement scope: Nil
211
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
2. Changes of owner’ equity shares in subsidiary and its impacts
Item JingzhouMeiling ShenyangMeiling Zhengzhou Meiling TaiyuanMeiling ChangshaMeiling Hohhot MeiLing Kunming Meiling Lanzhou Meizhilai Total
Originalratio ofsharesheld 81.00% 94.80% 85.00% 85.25% 86.00% 83.00% 86.50% 51.50%
Equitypurchased fromminority 15.00% 3.80% 10.00% 9.75% 11.00% 12.00% 9.00% 20.50%
Ratioofsharesheld atperiod-end 96.00% 98.60% 95.00% 95.00% 97.00% 95.00% 95.50% 72.00%
Cash 11.00 9.00 9.00 12.00 15.00 12.00 14.00 333,778.00 333,860.00
Acquisition cost/total disposal
11.00 9.00 9.00 12.00 15.00 12.00 14.00 333,778.00 333,860.00
consideration
Less: net assets of subsidiary measured
-903,669.21 -352,541.98 -1,080,438.58 -995,732.37 167,599.27 -194,991.57 -251,298.63 -367,120.57 -3,978,193.64
byequitysharesobtained bydisposed
Balance 903,680.21 352,550.98 1,080,447.58 995,744.37 -167,584.27 195,003.57 251,312.63 700,898.57 4,312,053.64
Including:
-903,680.21 -352,550.98 -1,080,447.58 -995,744.37 167,584.27 -195,003.57 -251,312.63 -700,898.57 -4,312,053.64
Capitalpublicreserveadjusted
Surpluspublicreserve adjusted
Retained profitadjusted
Purchased minority’s equity of marketing subsidiary in the Period, balance between the long-term equity investment newly obtained and the net assets shares enjoy according to the new share-holding
proportion since purchasing date amounting to -4,312,053.64 Yuan in total, and reckoned into capital public reserve.
212
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
3. Equity in joint venture or affiliated enterprise
(1) Major joint venture or affiliated enterprise
Share holding Accounting
(%) treatment for
Main office Registe Business investment of
Joint venture or affiliated enterprise
place r place nature Direct Indire joint venture or
ly ctly affiliated
enterprise
Affiliated enterprise:
1.ChanghongRubaElectricCompany Lahore, Manufactures,
Lahore 40.00 Equity method
(Private)Ltd. Pakistan sales
2.Hefei Xingmei Assets Management Co., Rental,
Hefei Hefei 48.28 Equity method
Ltd. agency
3.Sichuan Zhiyijia Network Technology
Mianyang Mianyang Sales 30.00 Equity method
Co., Ltd.
4.Hongyuan Dineng Rebao Technology Co. R & D, sales,
Mianyang Mianyang 49.00 Equity method
Ltd. after-sales
5.Sichuan Tianyou Guigu Technology Co., Manufactures,
Mianyang Mianyang 25.00 Equity method
Ltd. sales
(2) Financial information for major Joint venture: Nil
(3) Financial information for affiliated enterprise
Ending balance /CurrentYear
HefeiXingmei
ChanghongRubaEl Sichuan Zhiyijia Hongyuan Dineng SichuanTianyou
Item Assets
ectricCompany(Pri NetworkTechnology RebaoTechnology GuiguTechnology
Management Co.,
vate)Ltd. Co.,Ltd. Co. Ltd. Co.,Ltd.
Ltd.
Currentassets: 57,151,378.11 4,899,931.72 1,151,731,999.79 149,209,552.62 64,584,297.31
Including:cash and cash equivalent 284,327.38 888,771.72 10,073,753.50 3,438,402.87 41,602,160.88
Non-currentassets 88,631,877.31 23,485,265.76 10,765,142.54 1,249,641.49 32,673,915.06
Total assets 145,783,255.42 28,385,197.48 1,162,497,142.33 150,459,194.11 97,258,212.37
Currentliability 55,156,684.60 1,893,794.31 1,128,525,720.68 134,701,791.21 52,935,134.75
Mom-currentliability - - - - 5,745,454.55
Totalliabilities 55,156,684.60 1,893,794.31 1,128,525,720.68 134,701,791.21 8,680,589.30
Minority’sinterest - - - -
Equity attributable to shareholder of
90,626,570.82 26,491,403.17 33,971,421.65 15,757,402.90 88,577,623.07
parent company
213
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Share of net assets measured by
36,250,628.33 12,790,049.45 10,191,426.49 7,721,127.42 22,144,405.77
shareholing
Adjustmentitme - - -
--Goodwill - - -
Unrealized profit of the internal
6,262,565.34 - 3,055,447.01 971,877.05 6,096.76
downstreamtransactions
Unrealized profit of the internal
334,483.81 - - -
upstreamtransactions
Other - - -
Book value of the equity investment
29,988,062.99 12,790,049.45 7,135,979.48 6,749,250.37 22,138,309.01
for affiliate
Fair value of equity investment for the
- -
affiliateswith consideration publicly
Operation income 70,462,882.13 844,579.58 1,558,745,387.54 90,683,257.48 4,030,586.19
Financialexpenses 100,521.40 -3,138.37 -4,722,600.31 -24,436.43 -310,111.90
Income taxexpenses - - 1,997,985.96 - -
Netprofit -2,017,456.15 -116,030.74 9,003,340.70 -4,238,296.19 -2,700,889.12
Netprofitofdiscontinuingoperation
Othercomprehensiveincome
Total comprehensiveincome
Dividend received from affiliates in the
Year
(Continued)
Balance atyear-begin / LastYear
HefeiXingmei
ChanghongRubaEle Sichuan Zhiyijia Hongyuan Dineng SichuanTianyou
Item Assets
ctricCompany NetworkTechnology RebaoTechnology GuiguTechnology
Management Co.,
(Private)Ltd Co.,Ltd. Co. Ltd. Co.,Ltd.
Ltd.
Currentassets: 80,097,168.57 4,422,052.11 1,049,476,856.75 23,764,511.93 72,222,287.99
Including:cash and cash equivalent 7,375,329.25 4,422,051.68 91,309,812.52 8,883,320.31 55,646,748.59
Non-currentassets 89,542,558.20 24,020,971.98 1,601,922.21 735,873.42 33,684,137.62
Total assets 169,639,726.77 28,443,024.09 1,051,078,778.96 24,500,385.35 105,906,425.61
Currentliability 79,017,873.84 1,835,590.18 1,026,110,698.01 14,504,686.26 7,727,913.42
Mom-currentliability 6,900,000.00
Totalliabilities 79,017,873.85 1,835,590.18 1,026,110,698.01 14,504,686.26 14,627,913.42
Minority’sinterest
214
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Equity attributable to shareholder of
90,621,852.92 26,607,433.91 24,968,080.95 9,995,699.09 91,278,512.19
parent company
Share of net assets measured by
36,248,741.17 12,846,069.09 7,490,424.28 4,897,892.55 22,819,628.05
shareholing
Adjustmentitme
--Goodwill
Unrealized profit of the internal
6,535,060.85 2,677,325.98 852,389.87 -1,568.58
downstreamtransactions
Unrealized profit of the internal
628,197.71
upstreamtransactions
Other
Book value of the equity investment
29,713,680.32 12,846,069.09 4,813,098.30 4,045,502.68 22,821,196.62
for affiliate
Fair value of equity investment for the
affiliateswith consideration publicly
Operation income 53,465,851.90 718,954.00 779,965,255.17 78,645.86
Financialexpenses 41,481.34 -2,629.60 -31,655.82 -45,690.08
Income taxexpenses - 4,755.05 - -
Netprofit 1,017,466.19 -334,569.94 -21,387,184.40 -1,566,876.88
Netprofitofdiscontinuingoperation
Othercomprehensiveincome
Total comprehensiveincome
Dividend received from affiliates in the
Year
(4) Financial summary for non-important Joint venture and affiliate enterprise
Ending balance / Current
Item Balance at year-begin / Last Year
Year
Affiliate:
Total book value of investment
Total amount measured by shareholding
ratio
--net profit -1,831,541.72 -1,432,211.70
--Other comprehensiveincome
-- Total comprehensiveincome
(5) Major limitation on capital transfer ability to the Company from joint venture or affiliates: Nil
(6) Excess loss occurred in joint venture or affiliates: Nil
215
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(7) Unconfirmed commitment with joint venture investment concerned: Nil
(8) Intangible liability with joint venture or affiliates investment concerned: Nil
4. Major conduct joint operation: Nil
5. Structured body excluding in consolidate financial statement: Nil
IX. Relevant risks related with financial instrument
The major financial instruments of the Company include borrowings, account receivables, account payables,
transactional financial assets, transactional financial liabilities, the details of which are set out in Note VI.
Risks related to these financial instruments include exchange risks and interest rate risks. The management of
the Company controls and monitors the risk exposures to ensure the above risks are under control.
In connection with exchange risks, in order to prevent from exchange risks arising from foreign currency
transaction amount, foreign currency dominated loans and interest expenditure, the Company entered into
several forward exchange contracts with banks. Fair value of the forward exchange contract which has been
recognized as derivative financial instrument has been included in profits and losses. As export business is
increasing, if risks that are out of control of the Company occur such as appreciation of RMB, the Company
will mitigate the relevant risks by adjusting its sales policy.
The Company’s interest rate risk arises from bank borrowings and interest-bearing debt. Financial liabilities
at floating rate expose the Company to cash flow interest rate risk, and financial liabilities at fixed rate
expose the Company to fair value interest rate risk. The Company will determine the respective proportion of
contracts at fixed and floating rates based on the prevailing market conditions. As of 30 June 2016, the
interest-bearing debts mainly referred to borrowing contracts at floating rate denominated in RMB with total
amount of 350,701,900.00, borrowing contracts at fixed rate denominated in USD with total amount of
313,625,352.83 and borrowing contracts at fixed rate denominated in Euro with total amount of
104,725,000.00. Risks relating to change of fair value of financial instruments arising from movement of
interest rate mainly related to bank borrowings at fixed rate. As for borrowings at fixed rate, the Company
aims to keep its floating rate. Risks relating to change of cash flow of financial instruments arising from
movement of interest rate mainly related to bank borrowings at floating rate. The Company establishes its
policy to keep floating rate for these borrowings so as to eliminate fair value risk arising from movement of
interest rate.
X. Disclosure of fair value
F ai r v al u e at p e r i o d - e n d
Item
1st level 2nd level 3rd level Total
I. Continuous measure of fair value
(I) Financial assets measured by fair value
and with variation reckoned into current
gains/losses
216
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
1. Transactional financial assets 2,340,308.20 2,340,308.20
(1) Debt instrument investment
(2) Equity instrument investment
(3) Derivative financial assets 2,340,308.20 2,340,308.20
(4) Other
Total assets continue to be measured at fair
2,340,308.20 2,340,308.20
value
(II) Financial liabilities measured by fair
value and with variation reckoned into
current gains/losses
1. Transactional financial liabilities 3,618,878.41 3,618,878.41
(1)Trading bonds issued
(2) Derivative financial liabilities 3,618,878.41 3,618,878.41
(3) Other
Total liabilities continue to be measured at
3,618,878.41 3,618,878.41
fair value
XI. Related parties and related transaction
(I) Relationship of related parties
1. Controlling shareholder and ultimate controller
(1) Controlling shareholder and ultimate controller
Place of Legal
Controlling shareholder and Type of Nature of Organization
registratio representativ
ultimate controller entity business code
n e
Sichuan Changhong Electric Co., Mianya Manufactur
4,616,244,222 24.88% 24.88%
LTD ng e and sales
Sichuan Changhong Electronic Holding Group is the controlling shareholder of Sichuan Changhong
Appliances, and the SASAC Mianyang office holds 100.00% equity interests of Sichuan Changhong
Electronic Holding Group, which means that SASAC Mianyang office is the ultimate controller of the
Company.
(2) Register capital and change thereof of controlling shareholder
Increase Decrease
Balance at
Controlling shareholder during the during the Balance at year-end
year-begin
year year
Sichuan Changhong Electric Co.,
4,616,244,222 4,616,244,222
LTD
217
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(3) Shares held by the controlling shareholder and its changes on equity
Amount of shares held Shareholding ratio
Controlling shareholder Balance at Balance at Ratio at
Ratio at year-end
year-end year-begin year-begin
Sichuan Changhong Electric Co.,
189,994,153 189,994,153 24.88% 24.88%
LTD
2. Subsidiary
Found more in Note ―VIII. 1 (1) Enterprise group composition‖
3. Joint venture and Affiliated enterprise
Major Joint venture and affiliated enterprise of the Company found more in Note ―VIII. 3 (1) major joint
venture and Affiliated enterprise‖. Other Joint venture and affiliated enterprise that have related transactions
occurred with the Company in the Year or occurred in last period, and with blance results:
Joint venture and affiliated enterprise Relationship
Hefei Meiling Sole Energy Technology Co., Ltd. Affiliated enterprise of Subsidiary Meiling Group
ChanghongRubaElectricCompany(Private)Ltd. Affiliated enterprise of Subsidiary Zhongshan Changhong
Hefei Xingmei Assets Management Co., Ltd. Affiliated enterprise of the Company
Affiliated enterprise of the Company, sharing the same
Sichuan Zhiyijia Network Technology Co., Ltd. controlling shareholder with the Company and actual
controller
Affiliated enterprise of Subsidiary Changhong
Hongyuan Dineng Rebao Technology Co. Ltd.
Air-conditioning
Affiliated enterprise of Subsidiary Changhong
Sichuan Tianyou Guigu Technology Co., Ltd.
Air-conditioning
4. Other related parties
OtherRelated parties Relationship
Control by same controlling shareholder and ultimate
Huayi Compressor Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Mold Plastic Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Jijia Fine Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Mianyang Hongfa Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Package Printing Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Precision Electronics Tech. Co., Ltd.
controller
218
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
OtherRelated parties Relationship
Control by same controlling shareholder and ultimate
Sichuan Jiahong Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong New Energy Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Guangdong Changhong Electronics Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Xinrui Technology Co., Ltd
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Power Source Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Lighting Technology Co.,Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Hongwei Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
CHANGHONG(HK)TRADINGLIMITED
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong International Hotel Co., Ltd.
controller
Sichuan Changhong Communication Technology Co., Control by same controlling shareholder and ultimate
Ltd. controller
Control by same controlling shareholder and ultimate
Sichuan Service Exp. Appliance Service Chain Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Chengdu Changhong Minsheng Logistic Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong International Travel Agency Co., Ltd.
controller
Control by same controlling shareholder and ultimate
PT.CHANGHONGELECTRICINDONESIA
controller
Control by same controlling shareholder and ultimate
Sichuan CCO Display Device Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Hongxin Software Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Devices Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
CHANGHONGELECTRIC(AUSTRALIA)
controller
Control by same controlling shareholder and ultimate
CHANGHONGELECTRICMIDDLEEASTFZE
controller
219
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
OtherRelated parties Relationship
Control by same controlling shareholder and ultimate
Sichuan Changhong Gerun Renewable Resources Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Hefei Changhong Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Lejiayi Chain Management Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Minsheng Logistics Co., LTD
controller
Control by same controlling shareholder and ultimate
ChanghongEuropeElectrics.r.o
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Property Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Anhui Xinhao PDP Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Huafeng Corp. Group
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Network Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Chengdu Changhong Electronic Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Guangyuan Hongcheng Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
BVCH Optronics (Sichuan) Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Electronic System Co., Ltd.
controller
Control by same controlling shareholder and ultimate
081 Electronic Group Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Group Finance Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Yibin Hongxing Electronics Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Jingdezhen Honghua Home Appliance Parts Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Beijing Changhong Technology Co., Ltd.
controller before April 2016
Mianyang Hongrun Electronic Co., Ltd. Affiliate enterprise of controlling shareholder
Sichuan Hongyu Metal Manufacture Co., Ltd. Affiliate enterprise of controlling shareholder
220
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
OtherRelated parties Relationship
Sichuan Changxin Refrigeration Parts Co., Ltd. Affiliate enterprise of controlling shareholder
Mianyang Highly Electric Co., Ltd. Affiliate enterprise of controlling shareholder
Sichuan Changhe Technology Co., Ltd. Affiliate enterprise of controlling shareholder
(II) Related transactions
1. Purchasing commodity
Current Period Last Year
Related parties Content
(10 thousand Yuan) (10 thousand Yuan)
Sichuan Changhong Electric Co., LTD Purchasing commodity 7,972.57 7,272.32
Huayi Compressor Co., Ltd. Purchasing commodity 23,598.51 28,354.30
Sichuan Changhong Mold Plastic Tech. Co., Ltd. Purchasing commodity 24,724.78 18,050.50
Sichuan Changhong Jijia Fine Co., Ltd. Purchasing commodity 11,425.50 10,254.28
Sichuan Changhong Package Printing Co., Ltd. Purchasing commodity 2,819.62 2,634.87
Sichuan Changhong Precision Electronics Tech.
Purchasing commodity 471.03 346.07
Co., Ltd.
Sichuan Jiahong Industrial Co., Ltd. Purchasing commodity 2.91 -
Sichuan Changhong New Energy Technology Co.,
Purchasing commodity 16.18 37.89
Ltd.
081 Electronic Group Co., Ltd. Purchasing commodity 165.29 163.70
Sichuan Changhong Devices Technology Co., Ltd. Purchasing commodity 2,578.26 2,111.91
Mianyang Hongrun Electronic Co., Ltd. Purchasing commodity 583.74 471.38
Guangdong Changhong Electronics Co., Ltd. Purchasing commodity 561.62 333.51
CHANGHONG(HK)TRADINGLIMITED Purchasing commodity 179.34 -
Sichuan Changhong Lighting Technology Co.,Ltd. Purchasing commodity 0.57 -
Sichuan Zhiyijia Network Technology Co., Ltd. Purchasing commodity 1.32 -
Mianyang Hongfa Technology Co., Ltd. Purchasing commodity 46.93 49.27
Sichuan Changhong Xinrui Technology Co., Ltd Purchasing commodity 2,874.03 4,355.12
Sichuan Changhong Power Source Co., Ltd. Purchasing commodity 3.68 -
Sichuan Hongwei Technology Co., Ltd. Purchasing commodity 4.92 17.75
Sichuan Hongyu Metal Manufacture Co., Ltd. Purchasing commodity 6.97 34.77
Sichuan ChangheTechnology Co., Ltd. Purchasing commodity 308.60 181.61
Sichuan Changxin Refrigeration Parts Co., Ltd. Purchasing commodity 11,569.40 9,365.67
Mianyang Highly Electric Co., Ltd. Purchasing commodity 11,853.60 10,254.53
Hongyuan Dineng Rebao Technology Co. Ltd. Purchasing commodity 7,981.68 -
Sichuan Tianyou Guigu Technology Co., Ltd. Purchasing commodity 175.02 -
221
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Current Period Last Year
Related parties Content
(10 thousand Yuan) (10 thousand Yuan)
Total 109,926.07 94,289.45
2. Labor service receive
Related parties Content Current Period Last Year
Sichuan Changhong Minsheng Logistics Co., LTD Labor service receive 179,284,102.84 175,100,098.64
Sichuan Service Exp. Appliance Service Chain
Labor service receive 54,735,610.51 57,695,124.96
Co., Ltd.
Sichuan Changhong Electric Co., LTD Labor service receive 12,247,946.22 4,659,981.96
Sichuan Hongwei Technology Co., Ltd. Labor service receive - 581,150.94
Guangdong Changhong Electronics Co., Ltd. Labor service receive 298,128.51 40,025.96
Sichuan Changhong Mold Plastic Tech. Co., Ltd. Labor service receive - 12,279.45
Sichuan Changhong Jijia Fine Co., Ltd. Labor service receive - 4,304.00
Sichuan Hongxin Software Co., Ltd. Labor service receive 37,735.85 -
Sichuan Changhong Electronics Group Co., Ltd. Labor service receive 9,235.00 -
Sichuan Jiahong Industrial Co., Ltd. Labor service receive 148,240.81 14,390.60
Sichuan Changhong International Travel Agency
Labor service receive 81,913.94 -
Co., Ltd.
CHANGHONG(HK)TRADINGLIMITED Labor service receive 97,468.90 8,846.15
Total 246,940,382.58 238,116,202.66
3. Fuels and energy receive
Related parties Content Current Period Last Year
Fuels and energy
Huayi Compressor Co., Ltd. 262,087.18 192,958.98
receive
Fuels and energy
Guangdong Changhong Electric Co., LTD 570,996.81 500,672.92
receive
Sichuan Changhong Electronic Appliance Co., Fuels and energy
6,045,488.65 5,321,532.77
Ltd. receive
Fuels and energy
Sichuan Jiahong Industrial Co., Ltd. 7,135.70 -
receive
Fuels and energy
Sichuan Changhong Electronics Group Co., Ltd. 10,243.00 -
receive
Total 6,895,951.34 6,015,164.67
4. Sales of goods/ labor service providing
222
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Current Period Last Year
Related parties Content
(10 thousand Yuan) (10 thousand Yuan)
Sichuan Changhong Electronic Appliance Co., Ltd. Sales of goods 53,934.25 54,811.76
Sichuan Changhong Electronics Group Co., Ltd. Sales of goods 148.47 -
Sichuan Changhong Jijia Fine Co., Ltd. Sales of goods 2,269.56 1,697.64
Sichuan Changhong Mold Plastic Tech. Co., Ltd. Sales of goods 8,989.13 5,209.47
Lejiayi Chain Management Co., Ltd. Sales of goods 176.06 364.29
081 Electronic Group Co., Ltd. Sales of goods - -6.04
ChanghongEuropeElectrics.r.o Sales of goods - 92.42
CHANGHONG(HK)TRADINGLIMITED Sales of goods 36,112.72 27,291.35
Sichuan Changhong Property Co., Ltd. Sales of goods - 1.38
Anhui Xinhao PDP Co., Ltd. Sales of goods 5.13 53.85
Sichuan Changhong Xinrui Technology Co., Ltd. Sales of goods 75.89 2,216.58
Sichuan Changhong International Hotel Co., Ltd. Sales of goods - -2.56
Sichuan Hongwei Technology Co., Ltd. Sales of goods 0.61 2.44
Sichuan Changhong Devices Technology Co., Ltd. Sales of goods 0.17 37.46
Sichuan Changhong Packing & Printing Co., Ltd. Sales of goods - 21.16
Sichuan Changhong Precision Electronic
Sales of goods - 14.92
Technology Co., Ltd.
Sichuan Changhong Minsheng Logistic Co., Ltd. Sales of goods 58.92 4.28
Sichuan Kuaiyidian Appliance Service Chain Co.,
Sales of goods 285.23 286.92
Ltd.
Sichuan Changhong Gerun Renewable Resources
Sales of goods 364.88 445.82
Co., Ltd.
Hefei Changhong Industrial Co., Ltd. Sales of goods 104.71 209.32
Sichuan Huafeng Corp. Group Sales of goods 15.58 3.13
Guangdong Changhong Electrics Co., Ltd. Sales of goods 0.14 -
Sichuan Changhong Network Technology Co., Ltd. Sales of goods 0.61 -
Chengdu Changhong Electric Technology Co., Ltd. Sales of goods 1.55 -
Guangyuan Hongcheng Industrial Co., Ltd. Sales of goods - 0.03
Sichuan Ejar Network Technology Co., Ltd. Sales of goods 66,360.65 27,857.07
CHANGHONGELECTRIC(AUSTRALIA) Sales of goods 10.66 -
Sichuan Changhong Property Co., Ltd. Sales of goods 3.70 -
Sichuan Changhong Wisdom Health Science and
Sales of goods 0.30 -
Technology Co., Ltd.
Sichuan Huanyu Industrial Co. Ltd. Sales of goods 0.42 -
223
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Current Period Last Year
Related parties Content
(10 thousand Yuan) (10 thousand Yuan)
Mianyang Hong fa Technology Co., Ltd. Sales of goods 0.23 -
Mianyang Highly Electric Co., Ltd. Sales of goods - 0.46
Sichuan Changxin Refrigeration Parts Co., Ltd. Sales of goods 3,962.85 2,630.30
Hongyuan Dineng Rebao Technology Co. Ltd. Sales of goods 12,126.08 -
Sichuan Tianyou Guigu Technology Co., Ltd. Sales of goods 210.02 -
Hefei Meiling Solar Energy Technology Co., Sales of goods - 55.73
CHANGHONGRUBAELECTRICCO.,LTD Sales of goods 3,524.40 1,335.98
Fuyang Weiao Meiling Appliance Marketing Co.,
Sales of goods - 337.56
Ltd.
Total 188,742.92 124,972.72
Businesses between the Company and its connected persons are generally conducted under market operation
rules as if they were the same as other business counterparties. For price of sale or purchase and provision of
other labor service between the Company and its related parties, the state pricing is applicable if the pricing
do exists; in case of absence of such state pricing, price is determined under market price; in case of absence
of such market price, price is determined by both parties at actual cost plus reasonable expenses; for some
special services, the price of which cannot be determined under the rule of cost plus expense, the price shall
be determined by both parties by negotiation.
5. Fuel and energy providing
Related parties Content Current Period Last Year
Guangdong Changhong Electronics Co., Fuel and energy
292,821.41 315,249.10
Ltd. providing
Sichuan Changhong Minsheng Logistics Fuel and energy
20,229.17 11,959.67
Co., LTD providing
Sichuan Service Exp. Appliance Service Fuel and energy
- 68.38
Chain Co., Ltd. providing
Fuel and energy
Sichuan Hongwei Technology Co., Ltd. - 218.23
providing
Fuel and energy
Sichuan Changhong Jijia Fine Co., Ltd. 65,288.54 211,756.53
providing
Sichuan Changhong Mold Plastic Tech. Fuel and energy
3,010,107.37 3,256,618.73
Co., Ltd. providing
Sichuan Changhong Diveces Technology Fuel and energy
136,553.66 58,522.05
Co., Ltd. providing
Total 3,525,000.15 3,854,392.69
224
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
6. Related rental
(1) Renting
Type of Leasing income
Leasing income last
Lessor Lessee assets recognized in
year
leasing this period
Meiling Sichuan Changhong JijiaFineCo., Ltd. Warehouse 14,060.38 -
Meiling Sichuan Changhong JijiaFineCo., Ltd. Plant - 233,280.00
Meiling Sichuan Changhong JijiaFineCo., Ltd. Forklifttruck 442.45 23.12
Meiling Sichuan ChangheTechnologyCo., Ltd. Warehouse 1,833.96 -
Meiling Sichuan ChanghongMold PlasticTech. Co., Ltd. Plant - 647,190.00
Meiling Sichuan ChanghongMold PlasticTech. Co., Ltd. Warehouse 34,301.89 -
Meiling Sichuan ChanghongXinruiTechnologyCo.,Ltd Forklifttruck 390.57 389.15
Meiling Sichuan ChanghongXinruiTechnologyCo.,Ltd Warehouse 12,226.42 -
Changhong
BVCHOptronics(Sichuan)Co., Ltd. Goodslift 63,720.00 63,720.00
Air-Conditioner
Zhongshan
Sichuan Changhong JijiaFineCo., Ltd. 2# livingarea 3,889.43 -
Changhong
Zhongshan
Sichuan ChanghongMinsheng LogisticsCo., LTD Warehouse 100,000.00 -
Changhong
Zhongshan
GuangdongChanghongElectronicsCo., Ltd. Trade center 402,298.16 492,170.06
Changhong
Zhongshan
Sichuan ChanghongMinsheng LogisticsCo., LTD Trade center 20,006.99 3,388.28
Changhong
Mianyang Sichuan Changhong Package Printing Co., Rentalof
- 2,264.15
Refrigeration Ltd. warehouse
Mianyang Rentalof
Sichuan ChanghongMold PlasticTech. Co., Ltd. 32,943.40 32,943.40
Refrigeration warehouse
Mianyang Rentalof
Sichuan ChangheTechnologyCo., Ltd. 113.21 135.85
Refrigeration warehouse
Mianyang Rentalof
Sichuan Changxin RefrigerationParts Co., Ltd. 113.21 452.83
Refrigeration warehouse
Ridian Workshop
Sichuan HongweiTechnologyCo., Ltd. - 34,560.00
Technology lease
Ridian Sichuan Changhong Devices Technology Co., Workshop
418,624.00 417,984.00
Technology Ltd. lease
Ridian Workshop
Sichuan ChanghongMinsheng LogisticsCo., LTD 515,462.10 179,307.84
Technology lease
JiangxiElectric Sichuan ChanghongMold PlasticTech. Co., Ltd. Rentalof plant 241,197.71 225,960.00
225
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Type of Leasing income
Leasing income last
Lessor Lessee assets recognized in
year
leasing this period
JiangxiElectric Sichuan Changhong JijiaFineCo., Ltd. Rentalof plant - 67,032.00
Machinerayequi
JiangxiElectric Sichuan Changhong JijiaFineCo., Ltd. - 49,743.59
pment
Total 1,861,623.88 2,450,544.27
(2) Lessee
Leasing income
Type of assets Leasing income
Lessor Lessee recognized in this
leasing last year
period
Changhong
Sichuan ChanghongElectric Co., LTD Plant 2,204,901.44 3,711,585.62
Air-Conditioner
Sichuan Changhong electronic Holding Changhong
Building 51,912.42 -
Group Co., Ltd. Air-Conditioner
Sichuan Changhong electronic Holding Mianyang
Staffdormitory 2,080.00 2,800.00
Group Co., Ltd. Refrigeration
Mianyang
Sichuan ChanghongElectric Co., LTD Office room 46,951.52 13,596.00
software
Appliance
Sichuan ChanghongElectric Co., LTD Office room 354,901.77 207,440.71
marketing
Beijing
Sichuan ChanghongElectric Co., LTD Office room 89,128.50 -
Meiling
Ridian
GuangdongChanghongElectricCo., LTD Staffdormitory 279,543.46 209,027.02
Technology
Total 3,029,419.11 4,144,449.35
7. Related guarantee
Maximum guarantee
Completed
Secured party Sponsored party amount (in 10 Start date End date
(Y/N)
thousand yuan)
Zhongshan
Hefei Meiling 8,000.00 2015.03.30 2016.03.29 Y
Changhong
Zhongshan
Hefei Meiling 5,000.00 2015.05.27 2016.05.27 N
Changhong
Zhongshan
Hefei Meiling 15,000.00 2015.12.29 2016.12.29 N
Changhong
Zhongshan
Hefei Meiling 17,000.00 2015.12.30 2016.12.30 N
Changhong
226
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Maximum guarantee
Completed
Secured party Sponsored party amount (in 10 Start date End date
(Y/N)
thousand yuan)
Counter
guarantee:
Zhongshan
Hefei Meiling 8,000.00 2015.03.30 2016.03.29 Y
Changhong
Zhongshan
Hefei Meiling 5,000.00 2015.05.27 2016.05.27 N
Changhong
Zhongshan
Hefei Meiling 15,000.00 2015.12.29 2016.12.29 N
Changhong
Zhongshan
Hefei Meiling 17,000.00 2015.12.30 2016.12.30 N
Changhong
8. Assets transfer, debt restructuring of related parties
Related parties Type Current Period Last Year
Sichuan Changhong Electric Co., Ltd. Purchasing fixed assets 216,211.27 2,464,230.77
Sichuan Hongxin Software Co., Ltd. Purchasing fixed assets 188,679.25 495,283.02
Sichuan Hongxin Software Co., Ltd. Purchasing fixed assets 149,292.45 --
Sichuan Hongwei Technology Co., Ltd. Purchasing fixed assets 1,110,261.19 -
Sichuan Changhong Electronic System Co., Ltd. Purchasing fixed assets - 329,059.83
081 Electronic Group Sichuan Liyuan Electronic
Purchasing fixed assets - 59,829.06
Co., Ltd.
Sichuan Changhong New Energy Technology
Fixed assets sold - 15,035.60
Co., Ltd.
Sichuan Changhong Gerun Renewable Resources
Fixed assets sold 31,091.89 -
Co., Ltd.
9. Related transaction with Changhong Finance Company
(1) Saving balance
Related transaction Opening balance Ending balance Interest income
Bank savings 1,260,081,706.55 1,961,248,737.41 9,011,493.56
(2) Notes discounted
Bank acceptance Bank acceptance Expenses of discounted
Related transaction
book discounted amount discounted amount cash paid
Note receivable 543,065,633.55 538,478,569.07 6,620,397.78
(3) Notes issued
227
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Related transaction Issuing unit Note amount Type
Sichuan Changhong Group
Note payable Trade acceptance
Finance Co., Ltd. 1,005,335,926.96
(III) Come and go balance with related parties
1. Item receivables
Ending balance balance at period-begin
Bad
Item Related parties Bad debt debt
Book balance Book balance
provision provisio
n
Account
Sichuan Changhong Electric Co., Ltd. 10,634,631.95 - 2,138,556.68
receivable
Account Sichuan Changhong Electronics Holding Group
3,904,322.41 - 2,209,161.87
receivable Co., Ltd.
Account
Sichuan Changhong Mold Technology Co., Ltd. 547,345.90 - 207,505.03
receivable
Account
PT.CHANGHONGELECTRICINDONESIA - - 212,356.95
receivable
Account
Lejiayi Chain Management Co., Ltd. 652,486.77 325,769.21
receivable
Account
Hefei Changhong Industrial Co., Ltd. 542,529.31 1,492,108.99
receivable
Account
Huayi Compressor Co., Ltd. 263,800.00 - 263,800.00
receivable
Account
Sichuan Changhong Jijia Jinggong Co., Ltd. - - 5,536.56
receivable
Account
CHANGHONGELECTRIC(AUSTRALIA) 111,442.65 - -
receivable
Account
CHANGHONG(HK)TRADINGLIMITED 232,580,699.49 - 133,214,694.78
receivable
Account
Sichuan Changhong Minsheng Logistic Co., Ltd. 265,287.38 - -
receivable
Account
Sichuan Changhong Devices Technology Co., Ltd. 2,000.00 - -
receivable
Account Chengdu Changhong Electronic Technology Co.,
1,481,370.25 - 1,835,245.20
receivable Ltd.
Account Sichuan Changhong Gerun Renewable Resources
3,559.52 - 3,559.52
receivable Co., Ltd.
228
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Ending balance balance at period-begin
Bad
Item Related parties Bad debt debt
Book balance Book balance
provision provisio
n
Account
Sichuan Hongwei Technology Co., Ltd. - - 8,998.00
receivable
Account
Yibing Hongxing Electronics Co., Ltd. 1,058,049.10 - 1,058,049.10
receivable
Account
Sichuan Changhong Package Printing Co., Ltd. - - 800.00
receivable
Account
Sichuan Zhiyijia Network Technology Co., Ltd. 110,819,472.67 - 260,964,612.33
receivable
Account
CHANGHONGRUBAELECTRICCO.,LTD 37,125,902.04 34,269,278.41
receivable
Account
Anhui Xinhao PDP Co., Ltd. 630,000.00 - 645,000.00
receivable
Account Sichuan Changhong Network Technology Co.,
- 51,150.00
receivable Ltd.
Account
Sichuan Changhong Power Supply Co., Ltd. 18,200.78 -
receivable
Account
Sichuan Changhong Property Co., Ltd. 40,311.80 -
receivable
Account
Sichuan Changhong International Hotel Co., Ltd. 2,240,929.90 - 2,859,768.75
receivable
Account
Hongyuan Dineng Rebao Technology Co. Ltd. 17,705,969.67 - 12,094,465.83
receivable
Account paid
Sichuan Changhong Electric Co., Ltd. 3,001,653.77 -
in advance
Account paid
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 80.03 - 5.38
in advance
Account paid
Huayi Compressor Co., Ltd. 9,313,999.11 - -
in advance
Account paid
Sichuan Zhiyijia Network Technology Co., Ltd. 5,986.02 - -
in advance
Other account
Sichuan Changhong Electric Co., Ltd. - - 449,090.56
receivable
Other account Sichuan Kuaiyidian Appliance Service Chain Co.,
200,000.00 - 200,000.00
receivable Ltd.
229
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Ending balance balance at period-begin
Bad
Item Related parties Bad debt debt
Book balance Book balance
provision provisio
n
Other account
Sichuan Changhong Minsheng Logistic Co., Ltd. - 80,265.12
receivable
Other account
Sichuan Changhong Devices Technology Co., Ltd. - - 1,416.11
receivable
Other account
Hongyuan Dineng Rebao Technology Co. Ltd. 68,074.38 - -
receivable
Total 433,218,104.90 454,591,194.38
2. Item payables
Balance at
Item Related parties Ending balance
period-begin
Account
Sichuan Changhong Electric Co., Ltd. 14,245,010.06 29,851,894.60
payable
Account
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 134,180,824.48 46,397,079.60
payable
Account
Huayi Compressor Co., Ltd. 478,979.76 139,199,433.03
payable
Account
Sichuan Changhong Jijia Jinggong Co., Ltd. 91,324,264.95 18,183,863.16
payable
Account
Sichuan Changhong Minsheng Logistic Co., Ltd. 34,752,792.96 13,569,124.33
payable
Account
Sichuan Changhong Packing & Printing Co., Ltd. 30,667,631.85 3,815,726.06
payable
Account
Sichuan Changhong Devices Technology Co., Ltd. 20,926,513.11 2,856,979.62
payable
Account
Mianyang Hongrun Electronic Co., Ltd. 4,512,366.80 438,778.08
payable
Account Sichuan Changhong Precision Electronic
5,719,151.79 474,412.43
payable Technology Co., Ltd.
Account
081 Electronic Group 948,792.00 145,004.41
payable
Account Sichuan Changhong New Energy Technology Co.,
1,901.25 35,055.83
payable Ltd.
Account
Sichuan Changhong Lighting Technology Co., Ltd. - 28,458.00
payable
230
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at
Item Related parties Ending balance
period-begin
Account
Sichuan Changhong Power Co., Ltd. - 17,694.78
payable
Account
Sichuan Hongyu Metal Manufacture Co., Ltd. 448,832.44 76,605.95
payable
Account Sichuan Kuaiyidian Appliance Service Chain Co.,
14,381,111.55 12,325,292.30
payable Ltd.
Account Sichuan Changhong Gerun Renewable Resources
10,503.63 10,503.63
payable Co., Ltd.
Account
Chengdu Changhong Minsheng Logistic Co., Ltd. - 223,001.66
payable
Account
Sichuan Changhong Xinrui Technology Co., Ltd. 24,838,499.29 17,899,155.35
payable
Account
Mianyang Hongfa Technology Co., Ltd. 4,016,918.00 37,968.00
payable
Account
Guangdong Changhong Electrics Co., Ltd. 2,807,027.48 2,698,808.96
payable
Account
Sichuan Changhong Electronic System Co., Ltd. 77,000.00 77,000.00
payable
Account
Sichuan Hongwei Technology Co., Ltd. 1,356,520.87 -
payable
Account
Sichuan Huafeng Group Co., Ltd. 230,374.74 -
payable
Account
Sichuan Jiahong Industrial Co., Ltd. 146,102.14 78,317.93
payable
Account
Mianyang Highly Electric Co., Ltd. 22,054,033.64 20,557,246.51
payable
Account
Sichuan Changxin Refrigeration Parts Co., Ltd. 33,409,088.45 5,266,539.58
payable
Account
Sichuan ChangheTechnology Co., Ltd. 2,617,088.48 1,288,398.54
payable
Account
Hongyuan Dineng Rebao Technology Co. Ltd. 3,776,176.00 2,846,000.00
payable
Account
Sichuan Tianyou Guigu Technology Co., Ltd. - 333,333.01
payable
Account
received in Sichuan Changhong Electric Co., Ltd. - 4,549,701.77
advance
231
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at
Item Related parties Ending balance
period-begin
Account
received in Lejiayi Chain Management Co., Ltd. 20,900.02 900.02
advance
Account
received in PT.CHANGHONGELECTRICINDONESIA - 245.39
advance
Account
received in CHANGHONGELECTRICMIDDLEEASTFZE 1,660.78 1,626.32
advance
Account
received in CHANGHONG(HK)TRADINGLIMITED 317.48 317.48
advance
Account
Sichuan Service Exp. Appliance Service Chain Co.,
received in 20,408.59 25,349.12
Ltd.
advance
Account
received in Sichuan CCO Display Device Co., Ltd. - 74,587.00
advance
Account
Sichuan Changhong Gerun Renewable Resources
received in 375,231.72 339,625.21
Co., Ltd.
advance
Account
received in Sichuan Changhong Mold Plastic Tech. Co., Ltd. - 27,308.76
advance
Account
received in Sichuan Zhiyijia Network Technology Co., Ltd. 9,401,708.54 -
advance
Account
received in Sichuan Huafeng Group Co., Ltd. 4,500.00 -
advance
Account
received in Hefei Meiling Solar Energy Technology Co., 315,389.49 -
advance
Account
received in Hongyuan Dineng Rebao Technology Co. Ltd. 3,878,046.37 -
advance
Account
received in Sichuan Tianyou Guigu Technology Co., Ltd. 269,700.06 148,501.26
advance
232
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at
Item Related parties Ending balance
period-begin
Other account
Sichuan Changhong Electronics Group Co., Ltd. - 4,124.00
payable
Other account
Sichuan Changhong Electric Co., Ltd. 1,493,604.40 1,992,259.81
payable
Other account
081 Electronic Group 255.91 3,549.14
payable
Other account
Sichuan Changhong Minsheng Logistic Co., Ltd. 586,504.95 586,504.95
payable
Other account
CHANGHONG(HK)TRADINGLIMITED 588,935.68 876,260.05
payable
Other account
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 1,606,458.19 1,557,408.63
payable
Other account
Sichuan Changhong Jijia Jinggong Co., Ltd. 350,500.00 361,466.64
payable
Other account Sichuan Changhong Gerun Renewable Resources
10,000.00 10,000.00
payable Co., Ltd.
Other account
Sichuan Changhong Xinrui Technology Co., Ltd. 200,000.00 200,000.00
payable
Other account
Huayi Compressor Co., Ltd. 1,050,000.00 1,050,000.00
payable
Other account
Sichuan Changhong Packing & Printing Co., Ltd. 67,429.49 50,000.00
payable
Other account
Sichuan Zhiyijia Network Technology Co., Ltd. - 48,707.00
payable
Other account Sichuan Changhong Precision Electronic
148.56 -
payable Technology Co., Ltd.
Other account
Sichuan Changhong Devices Technology Co., Ltd. 50,246.64 -
payable
Other account
Sichuan Jiahong Industrial Co., Ltd. 2,532.34 2,182.34
payable
Other account
Guangdong Changhong Electronics Co., Ltd. 12,557.04 26,485.76
payable
Other account
Mianyang Highly Electric Co., Ltd. 527,934.86 603,295.12
payable
Other account
Sichuan ChangheTechnology Co., Ltd. 100,000.00 50,000.00
payable
Other account Sichuan Changxin Refrigeration Parts Co., Ltd. 50,000.00 50,000.00
233
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at
Item Related parties Ending balance
period-begin
payable
Total 468,912,476.83 331,372,081.12
(IV) Commitments from related parties: Nil
XII. Share-based payment: Nil
XIII. Contingency
1. Pending action or possible liabilities formed from arbitration: Nil
2. Contingency from external guarantee: Nil
3. Other contingency: Nil
XIV. Commitments: Nil
XV. Events occurring after the balance sheet date
1. Important non-adjustment items: Nil
2. Profit distribution: Nil
3. Major sales re turn : Nil
4. Other than the above mentioned events, the Company have no other events occurred after balance sheet
date.
XVI. Other significant matters
1. Correction o f p re vio us perio s and in fluence: n il
2. Debt restru ctu ring: n il
3. Assets rep lace men t: nil
4. P ension p lan : n il
5. Discon tinu ing ope ra tion: nil
6. Branch in for mation
Item Ice cuber AC Marketing Other Salesin branch Total
Operation income 364,978.24 275,638.73 140,213.68 33,996.48 128,164.00 686,663.13
Including:: Income fromtradingoutside 243,441.55 275,617.52 140,213.68 27,390.38 - 686,663.13
Income fromtradinginbranch 121,536.69 21.21 - 6,606.10 128,164.00 -
Operation expenses 355,129.44 274,104.94 141,704.45 34,089.19 127,985.95 677,042.07
Operationprofit 9,848.80 1,533.79 -1,490.77 -92.71 - 9,621.06
Total assets 947,521.32 342,097.41 55,300.14 36,386.51 205,704.05 1,175,601.33
Totalliability 553,768.68 266,210.20 85,854.77 21,339.03 101,833.38 825,339.30
234
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Ice cuber AC Marketing Other Salesin branch Total
Suppllementaryinformation - - - - - -
Depreciation and amortizataion expenses 6,304.93 2,002.20 9.74 612.40 - 8,929.27
Capital expenditure 6,253.90 3,281.00 18.80 329.72 - 9,883.42
Non-cash expenses except for depreciation
45,075.63 27,823.46 15,538.24 2,841.36 -513.08 91,791.77
and amortizataion
7. Other major transactions and events shows impact on investor’s decision-making: nil
XVII. Notes to main items of financial statement of parent company
1. Account receivable
(1) Classify of account receivable
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single significant
amount and withdrawal single item bad
debt provision
Account receivable withdrawal bad debt
provision by combination
Combination 1 367,860,966.26 32.56% 22,512,196.52 6.12% 345,348,769.74
Combination 2 762,085,649.70 67.44% 762,085,649.70
Combination Subtotal 1,129,946,615.96 100.00% 22,512,196.52 1.99% 1,107,434,419.44
Account receivable with single minor
amount but withdrawal single item bad -
debt provision
Total 1,129,946,615.96 100.00% 22,512,196.52 1.99% 1,107,434,419.44
(Continued)
Amount at year-begin
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single
significant amount and withdrawal single
item bad debt provision
Account receivable withdrawal bad debt
— — — — —
provision by combination
Combination 1 153,138,749.45 16.03% 11,767,503.69 7.68% 141,371,245.76
235
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Amount at year-begin
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Combination 2 801,957,750.21 83.97% 801,957,750.21
Combination Subtotal 955,096,499.66 100.00% 11,767,503.69 1.23% 943,328,995.97
Account receivable with single minor
amount but withdrawal single item bad
debt provision
Total 955,096,499.66 100.00% 11,767,503.69 1.23% 943,328,995.97
1) No account receivable with single significant amount and withdrawal bad debt provision single at
period-end.
2) Account receivable with Withdrawal of bad debt provision by aging account in combination 1
Ending balance
Age
Account receivable Bad debt provision Provision ratio (%)
Within 1 year 360,555,926.38 18,027,796.32 5%
1-2 years 303,018.15 45,452.72 15%
2-3 years 3,935,723.07 1,377,503.07 35%
3-4 years 43.55 23.95 55%
4-5 years 32,231.00 27,396.35 85%
Over 5 years 3,034,024.11 3,034,024.11 100%
Total 367,860,966.26 22,512,196.52 —
3) Account receivable without bad debt provision withdrawal in combination 2
Combination Book balance
Connected amount between related parties 703,247,660.01
Account receivable with L/C 58,837,989.69
Total 762,085,649.70
4) No account receivable with single minor amount but withdrawal single item bad debt provision at
period-end
(2) Provision, reversal (or recovery) of bad debt provision
The bad debt accrual in the year was RMB 10,744,692.83; no recovery or reversal bad debt provision in the
year.
(3) No account receivable actually written-off at period-end.
(4) No arrears of the shareholders holding more than 5% (including 5%) shares with voting rights of the
Company at period-end.
236
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
The top five account receivable at period-end has RMB 436,483,257.09 in total, a 38.63% in total account
receivable.
(5) Account receivable de-recognized: Nil
2. Other account receivable
(1) Category of other account receivable
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Other account receivable with single
significant amount and withdrawal single
item bad debt provision
Other account receivable withdrawal bad
debt provision by combination
Combination 1 2,727,268.68 2.30% 329,158.28 12.07% 2,398,110.40
Combination 2 115,916,433.22 97.70% - 115,916,433.22
Combination Subtotal 118,643,701.90 100.00% 329,158.28 0.28% 118,314,543.62
Other account receivable with single minor
amount but withdrawal single item bad -
debt provision
Total 118,643,701.90 100.00% 329,158.28 0.28% 118,314,543.62
(Continued)
Amount at year-begin
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Other account receivable with single
significant amount and withdrawal single
item bad debt provision
Other account receivable withdrawal bad
debt provision by combination
Combination 1 4,840,833.66 8.76% 1,976,106.94 40.82% 2,864,726.72
Combination 2 50,391,165.17 91.24% 50,391,165.17
Combination Subtotal 55,231,998.83 100.00% 1,976,106.94 3.58% 53,255,891.89
Other account receivable with single minor
amount but withdrawal single item bad debt
provision
Total 55,231,998.83 100.00% 1,976,106.94 3.58% 53,255,891.89
1) No other account receivable with single significant amount and no withdrawal bad debt provision single at period-end
237
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
2) Other account receivable with withdrawal bad debt provision by aging account for combination 1
Ending balance
Age
Account receivable Bad debt provision Provision ratio (%)
Within 1 year 2,058,180.21 102,909.01 5%
1-2 years 482,108.47 72,316.27 15%
2-3 years 10,000.00 3,500.00 35%
3-4 years - - 55%
4-5 years 176,980.00 150,433.00 85%
Over 5 years - - 100%
Total 2,727,268.68 329,158.28 —
3) Other receivable without bad debt provision withdrawal in combination 2
Combination Book balance
Connected amount between related parties 95,509,358.72
Loans of employee’s pretty cash 3,871,741.10
Export tax refunds receivable 16,535,333.40
Total 115,916,433.22
4) No other account receivable with single minor amount but withdrawal bad debt provision singly, refers to
the minor single receivables at period-end.
(2) Reversal (or withdraw) of reserve for bad debts in the Year
Releasing bad debt provision in the year amounting to RMB 1,646,948.66; bad debt recoverd the original
verification was RMB 6,000.00 in the year.
(3) Other account receivable charge off in this year: Nil
(4) No areas from shareholders’ unit with over 5 percent (5 percent included) voting rights held at
period-end.
Top 5 other account receivable has RMB 113,902,935.79 in total, a 96.00% in total other account receivable.
(5) Other receivables classify by nature
Nature Ending book balance Book balance at year-begin
Related parties 95,509,358.72 32,309,376.56
Loans of employee’s pretty cash 3,871,741.10 3,317,078.21
Margin 198,295.60 398,295.60
Advance money paid temporary 1,132,421.58 -
Other 1,396,551.50 4,442,538.06
Export rebate 16,535,333.40 14,764,710.40
Total 118,643,701.90 55,231,998.83
238
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(6) Other receivable de-recognized: Nil
239
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
3. Long-term equity investments
(1) Classification of long-term equity investments
Ending balance Balance at year-begin
Item
Book balance Impairment loss Book value Book balance Impairment loss Book value
Investment in subsidiaries
Hefei Meiling Packing Products Co., Ltd. 12,961,230.52 12,961,230.52 12,961,230.52 12,961,230.52
Zhongke MeiLing Low-temperature Technology Co.,
42,000,000.00 42,000,000.00 42,000,000.00 42,000,000.00
Ltd.
Mianyang MeiLing Refrigeration Co.,
95,000,000.00 95,000,000.00 95,000,000.00 95,000,000.00
Ltd.
Hefei Meiling Appliance Marketing Co.,
54,900,000.00 54,900,000.00 54,900,000.00 54,900,000.00
Ltd.
Zhongshan Changhong Appliance Co.,
169,856,419.37 169,856,419.37 112,256,419.37 112,256,419.37
Ltd
Sichuan Changhong Air Conditioner Co.,
305,600,437.79 305,600,437.79 305,600,437.79 305,600,437.79
Ltd.
Hefei Meiling Group Holding Co., Ltd. 113,630,000.00 113,630,000.00 113,630,000.00 113,630,000.00
Jiangxi MeiLing Electric Appliance Co.,
79,000,000.00 79,000,000.00 79,000,000.00 79,000,000.00
Ltd.
Mianyang Meiling Software Technology
4,950,000.00 4,950,000.00 4,950,000.00 4,950,000.00
Co., Ltd.
Guangdong Changhong
90,802,593.15 90,802,593.15
RidianTechnology Co., Ltd.
240
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Ending balance Balance at year-begin
Item
Book balance Impairment loss Book value Book balance Impairment loss Book value
Changmei Technology Co., Ltd. 18,000,000.00 18,000,000.00
Investment in associates
Hefei Xingmei Assets Management Co.,
12,790,049.45 12,790,049.45 12,846,069.09 12,846,069.09
Ltd.
Sichuan Zhiyijia Network Technology
10,191,426.49 10,191,426.49 7,490,424.28 7,490,424.28
Co., Ltd.
Total 1,009,682,156.77 1,009,682,156.77 840,634,581.05 840,634,581.05
(2) Investment in subsidiaries
Balance at Increase during the Decrease during the Provision forimpairment Ending balance of
Invested unit Ending balance
year-begin year year losses impairment loss
Hefei Meiling Packing Products Co., Ltd. 12,961,230.52 12,961,230.52
Zhongke Meiling Cryogenic Technology
42,000,000.00 42,000,000.00
Co., Ltd.
Mianyang MeiLing Refrigeration Co.,
95,000,000.00 95,000,000.00
Ltd.
Hefei Meiling Appliance Marketing Co.,
54,900,000.00 54,900,000.00
Ltd.
Zhongshan Changhong Appliance Co.,
112,256,419.37 57,600,000.00 169,856,419.37
Ltd
Sichuan Changhong Air Conditioner Co., 305,600,437.79 305,600,437.79
241
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Balance at Increase during the Decrease during the Provision forimpairment Ending balance of
Invested unit Ending balance
year-begin year year losses impairment loss
Ltd.
Hefei Meiling Group Holding Co., Ltd. 113,630,000.00 113,630,000.00
Jiangxi MeiLing Electric Appliance Co.,
79,000,000.00 79,000,000.00
Ltd.
Mianyang Meiling Software Technology
4,950,000.00 4,950,000.00
Co., Ltd.
Guangdong Changhong
90,802,593.15 90,802,593.15
RidianTechnology Co., Ltd.
Changmei Technology Co., Ltd. 18,000,000.00 18,000,000.00
Total 820,298,087.68 166,402,593.15 986,700,680.83
(3) Investment in associates
Changes intheYear
Adjustment Ending
Balance at Investment income Other Cash dividend or
Invested unit Additional Negative for other Provision for Ending balance balance of
year-begin recognizedunder equity profitannounced to Other
Investment Investment comprehensi impairment loss impairment
equity change issued
ve income
Hefei Xingmei Assets
12,846,069.09 -56,019.64 12,790,049.45
ManagementCo., Ltd.
Sichuan Zhiyijia Network
7,490,424.28 2,701,002.21 10,191,426.49
TechnologyCo.,Ltd.
Total 20,336,493.37 2,644,982.57 22,981,475.94
242
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
4. Operation income and operation cost
Current Year Last Year
Item
Income Cost Income Cost
Main business 3,359,972,441.96 2,762,714,566.29 3,273,590,576.99 2,749,342,602.87
Other business 410,800,721.97 397,417,660.72 450,054,174.95 435,680,329.62
Total 3,770,773,163.93 3,160,132,227.01 3,723,644,751.94 3,185,022,932.49
(1) Classified according to product-main buiness
Current Year Last Year
Product
Operation income Operation cost Operation income Operation cost
Refrigerator and
3,162,550,759.77 2,654,440,336.36
freezer
3,178,958,581.60 2,612,206,850.23
Washing machine 179,396,785.22 150,507,716.06 111,033,625.17 94,896,268.57
Other 6,192.05 5,997.94
1,617,075.14
Total 3,273,590,576.99 2,749,342,602.87
3,359,972,441.96 2,762,714,566.29
(2) Classified according to region-main buiness
Current Year Last Year
Regions
Operation income Operation cost Operation income Operation cost
Domestic 2,481,708,373.76 2,002,163,732.22 2,501,342,037.25 2,056,276,249.58
Foreign 878,264,068.20 760,550,834.07 772,248,539.74 693,066,353.29
Total 3,359,972,441.96 2,762,714,566.29 3,273,590,576.99 2,749,342,602.87
Income in sales of top five clients was RMB 809,679,822.07 yuan, a 21.47% in total operation income.
5. Investment income
Item Current Year Last Year
Long-term equity investment income by cost method 75,261,313.40
Long-term equity investment income by equity method 2,644,982.57 -6,577,685.69
Other 4,986,301.37 517,808.22
Total 82,892,597.34 -6,059,877.47
XVIII. Approval of financial statement
The financial statement has already been approved from the board of directors of the Company for reporting dated
28 July 2016.
Supplementary information for financial statement
1. Non-operational gains and losses for this year
243
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
(1) Non-recurring gains and losses regulated by Explanation Announcement of Information Disclosure on Stock
Issuance Enterprise No.1—Non-recurring gains/losses (2008) from CSRC:
Item Current Year Note
Gains and losses from disposal of non-current assets -1,214,295.88
Tax refund or mitigate due to examination-and-approval beyond power or without
-
official approval document or accident
Government subsidy recorded in current gains and losses 14,750,673.67
Capital occupancy expense, collected from non-financial enterprises and recorded
in current gains and losses
Income from the exceeding part between investment cost of the Company paid for
obtaining subsidiaries, associates and joint-ventures and recognizable net assets fair
value attributable to the Company when acquiring the investment
Gains and losses from exchange of non-monetary assets
Gains and losses from assets under trusted investment or management
Various provision for impairment of assets withdrew due to act of God, such as
natural disaster
Gains and losses from debt restructuring
Enterprise reorganization expense
Gains and losses of the part arising from transaction in which price is not fair and
exceeding fair value
Current net gains and losses occurred from period-begin to combination day by
subsidiaries resulting from business combination under common control
Gains and losses arising from contingent proceedings irrelevant to normal operation
of the Company
Except for effective hedge business relevant to normal operation of the Company,
gains and losses arising from fair value change of tradable financial assets and 3,707,731.16
tradable financial liabilities, and investment income from disposal of tradable
financial assets, tradable financial liabilities and financial assets available for sale
Switch-back of provision of impairment of account receivable which are treated
with separate depreciation test
Gains and losses obtained from external trusted loans
Gains and losses arising from change of fair value of investment real estate whose
follow-up measurement are conducted according to fair value pattern
Affect on current gains and losses after an one-time adjustment according to
requirements of laws and regulations regarding to taxation and accounting
Trust fee obtained from trust operation
244
Annotations of Financial Statements of Hefei Meiling Co., Ltd.
From 1 January 2016 to 30 June 2016
(Unless other wise specified, RMB for record in the Statement)
Item Current Year Note
Other non-operating income and expenditure except for the aforementioned ones 4,410,917.97
Other gains and losses items complying with definition for non-current gains and
losses
Subtotal 21,655,026.92
Affect on income tax 2,325,980.83
Affect on minority equity(after taxation) 137,999.52
Total 19,191,046.57
2. Return on equity and earnings per share
In accordance with requirement of the No. 9 Rule of Information Disclosure Compiling of Public Listed Companies:
Calculation and Disclosure of Return on Equity and Earnings per Share (revised in 2010), the weighted average
return on equity, basic earnings per share and diluted earnings per share of the Company in half 2016 are as
follow:
Weighted average Earnings per share/EPS
Profit during the report period
return on equity Basic EPS Diluted EPS
Net profit attributable to shareholders of
3.12% 0.1440 0.1440
parent company
Net profit attributable to shareholders of
parent company after deduction of 2.58% 0.1189 0.1189
non-recurring gains and losses
3. Accounting difference under the accounting rules in and out of China: Nil
4. Supplementary information for accounting policy changed: Nil
245
HEFEI MEILING CO., LTD SEMI-ANNUAL REPORT 2016
Section X. Documents Available for Reference
I. Text of semi-annual report with the signature of the Chairman;
II. Accounting statement carrying the signatures and seals of the Chairman, vice president and
financial administrator as well as the person in charge of accounting organ(chief accountants);
III. Originals documents of the Company and manuscripts of public notices that disclosed in
the newspapers designated by CSRC in the report period;
The aforesaid documents are all available at headquarter of the Company. The Company would
provide them timely when CSRC and Shenzhen Stock Exchange require or the shareholders need
consultation according to the regulations and Articles of Association.
Chairman: Liu Tibin
Hefei Meiling Co., Ltd.
29 July 2016
246
