Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Dalian Refrigeration Co., Ltd.
2015 Semiannual Report
August, 2015
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 1 Important Notice, Table of Contents, and
Definitions
The directors and the Board of Directors, the supervisors and the
Supervisory Board, and Senior staff members of Dalian
Refrigeration Co., Ltd. (hereinafter referred to as the Company)
hereby confirm that there are not any important omissions,
fictitious statements or serious misleading carried in this report,
and shall take all responsibilities, individual and/or joint, for the
reality, accuracy and completeness of the whole contents.
All directors have attended this Board meeting of the Company.
The company plans to distribute no cash dividends, no bonus
shares and convert no reserve fund into capital stock.
Chairman of the Board of Directors of the Company Mr. Ji Zhijian,
Financial Majordomo Mrs. Rong Yan, and the head of Accounting
Department Mrs. Mao Chunhua hereby confirm that the financial
report of the semi-annual report is true and complete.
This report is written respectively in Chinese and in English. In the
event of any discrepancy between the two above-mentioned
versions, the Chinese version shall prevail.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
CONTENTS
Section 1 Important Notice, Table of Contents, and Definitions ................................. 2
Section 2 About the Company .................................................................................... 5
Section 3 Summary of Main Accounting Data and Financial Indicators ..................... 7
Section 4 Board of Directors' Report .......................................................................... 9
Section 5 Important Issues ....................................................................................... 15
Section 6 Change in Share Capital and Shareholders' Information ........................... 20
Section 7 Information on Preferred Stock ................................................................ 22
Section 8 Information on the Company’s Directors, Supervisors, Senior
Management ............................................................................................................ 23
Section 9 Financial Report ....................................................................................... 24
Section 10 Contents of Reference Documents ........................................................ 105
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Definitions
Defined item Meaning
Reporting period Stands for From Jan. 1, 2015 to Jun. 30, 2015
The Company, this Company Stands for Dalian Refrigeration Co., Ltd.
Wuhan New World Refrigeration Industries Co., Ltd., one of the
Wuxin Refrigeration Stands for
controlled subsidiaries of this Company.
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd., one of
Sanyo High-Efficient Stands for the mutual shareholding companies of the Company before, and the
subsidiary of this Company now.
Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd., one
Bingshan Ryosetsu Stands for
of the subsidiaries of the Company.
Dalian Bingshan Metal Processing Co., Ltd., one of the subsidiaries
Bingshan Metal Processing Stands for
of the Company.
Panasonic Compressor (Dalian) Co., Ltd., one of the mutual
Panasonic Compressor shareholding companies of the Company, where the Company holds
40% of its shares.
Panasonic Cold-Chain (Dalian) Co., Ltd., one of the mutual
Panasonic Cold-Chain shareholding companies of the Company, where the Company holds
40% of its shares.
Dalian Fuji-Bingshan Vending Machine Co., Ltd., one of the mutual
Dalian Fuji-Bingshan Stands for shareholding companies of this Company, where the Company holds
49% of its shares.
Keihin Grand-Ocean Cooling & Heating Industry (Dalian) Co., Ltd.,
Keihin Grand-Ocean Stands for one of the mutual shareholding companies with this Company, where
the Company holds 20% of its shares.
A high-efficiency and energy-saving full-hermetic compressor using
Scroll compressor Stands for
advanced technology.
The Product Data Management system, a technology managing all
information and processes relating to products to provide
PDM Stands for information management in the whole life of product and establish a
parallel collaborative environment for product design and
manufacture within the enterprise.
The Enterprise Resource Planning system, a enterprise information
management system oriented to manufacturing industries for the
ERP Stands for
integration management of material resources, financial resources
and information resources.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 2 About the Company
I. Company information
Short form of the stock DALENG GUFEN; DALENG-B
Stock code 000530; 200530
Listed stock exchange Shenzhen Stock Exchange
Legal name in Chinese 大连冷冻机股份有限公司
Short form of legal name 大冷股份
Legal English name Dalian Refrigeration Co., Ltd.
Abbreviation of legal English name DRC
Legal representative Ji Zhijian
II. Contact persons and information
Secretary of the Board of Directors Authorized representative for securities affairs
Name Song Wenbao Song Wenbao (proxy)
Securities & Legal Affairs Department, No. 888, Securities & Legal Affairs Department, No. 888,
Address
Xinan Road, Shahekou District, Dalian Xinan Road, Shahekou District, Dalian
Tel. 0411-86538130 0411-86538130
Fax 0411-86654530 0411-86654530
E-mail 000530@bingshan.com 000530@bingshan.com
III. Other situations
1. Contact of company
If the registered address, office address and zip code, website, email box of the company had any
change in the report period
□ Applicable √ Not applicable
The registered address, office address and zip code, website, email box of the company had no
change in the report period. Refer to the Annual Report for 2014 for details.
2. Information disclosure and place of preparation
If the information disclosure and the place of preparation had any change in the report period
□ Applicable √ Not applicable
The name of newspaper for information disclosure selected by the company, the address of the
website designated by China Securities Regulatory Commission for carrying semi-annual report, the
place where the semi-annual report of the Company is prepared had no change in the report period.
Refer to the Annual Report for 2014 for details.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
3.Registration variation
If registration varied in the report period
√ Applicable □ Not applicable
According to the proposals of The Restricted Stock Incentive Plan Draft of the Company，as for the
resolution of the 15th meeting of the 6th session of the Board, March 4th 2015 was determined as the
grant date, awarding the 41 equity incentive objects with restricted shares amounting to 10,150,000
shares. After the completion of granting restricted stock, the total share capital of the Company has
changed from 350,014,975 shares to 360,164,975 shares, and the Company has completed the above
said business registration of change on May 28, 2015.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 3 Summary of Main Accounting Data and Financial
Indicators
I. Main accounting data and financial indicators
Did the Company retroactively adjust or restate the accounting data of previous years due to change
in the accounting policy and correction of accounting mistakes?
√ Yes □ No
Increase/decrease compared with
2014.01-06
item 2015.01-06 previous period
Before adjustment After adjustment After adjustment
Operating revenue 711,740,342.13 774,912,253.19 774,912,253.19 -8.15%
Net profit attributable to
65,477,775.99 66,477,633.28 66,477,633.28 -1.50%
shareholders of listed companies
Net profit belonging to the
shareholders of listed companies
63,880,328.51 63,794,559.91 63,794,559.91 0.13%
after the deduction of
non-recurring profit and loss
Net cash flow from operating
-130,589,921.37 -2,594,386.46 -2,594,386.46 --
activities
Basic earning per share 0.18 0.19 0.19 -5.26%
Diluted earnings per share 0.18 0.19 0.19 -5.26%
Weighted average return on net
3.26% 3.49% 3.49% Decrease 0.23 percentage points
asset yield
Increase/decrease compared with
2014.12.31
2015.6.30 2014.12.31
Before adjustment After adjustment After adjustment
Total assets 4,122,114,054.42 3,053,930,248.25 3,053,930,248.25 34.98%
Owner's equity attributable to
2,891,763,301.60 1,967,027,256.13 1,967,027,256.13 47.01%
shareholders of listed companies
II. Difference of accounting data between as per Chinese accounting standards
and as per International Accounting Standards
The difference of accounting data between as per Chinese Accounting Standards and as per International
Accounting Standards was 0.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
III. Non-recurring profits and losses and their amounts
Item Amount
Disposal gains and losses of non-current asset 26,473.73
Tax return or exemption exceeding authority or without
1,447.50
formal authorization documents
Government subsidies included in current profit or loss 1,751,055.19
Other non-operating revenue or expense 135,520.95
Influence on income tax 303,540.74
Influence on minority shareholders 13,509.15
Influence on net profit 1,597,447.48
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 4 Board of Directors' Report
I. Summary
In first half of 2015, around by the operation principle of “Leading Innovation, Creating Value”, the
Company cope with the many challenges cool-headedly, response initiatively, driven by efficiency
implementation of the initial phase of restricted stock incentive plan, accelerate integration of
capital and resources and business model innovation, pursuit operation management efficiency &
quality, strive to achieved the operation goals and accumulate power for the rapid expansion in the
future.
The Company gains operation revenue of 711.74 million Yuan in first half of 2015, representing
91.66% of the operation goals for first half of 2015, with a y-o-y decrease of 8.15%; total profit
achieved 70.37 million Yuan, realizing the operation goals for first half of 2015, with a y-o-y
decrease of 3.70%.
During the reporting period, the Company place extra emphasis on food refrigeration business,
engineering, trading and service business, optimized and improved a serial comprehensive solution
plans, took the initiative in value creation for the clients, actively cope with the changes in market.
Take the opportunity of the 2015 global cold-chain logistic summit, the Company present a
comprehensive display of value chain system with Bingshan-characteristic, and aggressively build a
value chain of internet+, escort for the food security.
During the reporting period, based on growth and profitability, the Company accelerated the
integration of capital and resources. Acquired 49% equity of Wuxin Refrigeration, turning Wuxin
Refrigeration as the wholly-owned subsidiary from controlling subsidiary, implementing one
operation, and creating differentiated products; acquired 30% equity of Sanyo High-Efficient, turns
Sanyo High-Efficient as the controlling subsidiary from affiliated company, introducing new
technology, and improving the heat exchange link of cold & heat industry chain; implemented
merger by absorption between the controlling subsidiary Bingshan Ryosetsu and wholly-owned
subsidiary Bingshan Metal Processing, improving the efficiency.
During the reporting period, around improving the sales platform and creating the service platform,
the Company accelerated integration of capital and resources and business model innovation.
Through one operation, to play the role on sales platform of Dalian Bingshan Group Sales Co., Ltd,
and to improve the ability of solution. Bingshan Technology Service (Dalian) Co., Ltd, the service
platform, put into operation officially, expended business and achieved initial results.
During the reporting period, the information construction of PDM and ERP have staging officially,
and the delicacy management improved orderly.
During the reporting period, the Company actively push forward the construction of virtual
technology R&D platform, and carried out the joint development program for the new products. The
Company has completed the design of origin pre-cooling setting and cooling heat-recovery unit and
commercialization.
During the reporting period, the Company actively push forward the construction of intelligent new
factory in an orderly manner.
During the reporting period, while eyes on maintaining traditional customers, the associated
company Panasonic Compressor continues to develop new clients, further to consolidate the
dominant status of Freon system in cold storage market. R32 scroll compressor rated as the
innovative products of the China Refrigeration Show, which will occupy the advantage in FTXS
switching. By strengthen supplier management, the perfect defectives declined obviously on a y-o-y
basis.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
During the reporting period, the associated company Panasonic Cold-Chain actively create a new
mechanism of production and sales integration, continue to creating values for customers. Promote a
comprehensive solution plan for the intelligent convenience store, and open a first prototype store in
Jingan District, Shanghai City. Release the intelligent fresh distribution cabinet, extend the end of
cold-chain service to community from supermarket and convenience store.
During the reporting period, the associated company Dalian Fuji Bingshan achieved a new
progresses in market exploitation, sales volume of the vending machine in excess of 9,000 sets. By
mill type modification, organic combination of the vending machine and intelligent, mobile
payment, and with consideration to the double sales condition of foods and beverage, actually best
serve the customers and consumers.
II. Analysis of main business
Main financial data variations as compared to the same period of last year
Monetary unit: RMB Yuan
Increase or decrease
Same period of
Report period from the same period Reason for variation
last year
of last year
Operating revenue 711,740,342.13 774,912,253.19 -8.15%
Operating cost 562,347,397.92 609,950,440.82 -7.80%
Selling and distribution expenses 35,327,320.58 48,901,400.51 -27.76%
Administrative expenses 88,737,103.40 89,762,782.36 -1.14%
Mainly due to increase of the loan
interest and decrease of the term
Financial expenses -1,831,323.45 -3,797,684.83 51.78%
deposit interest in the report
period.
Mainly due to increase of the
Income tax 5,691,645.31 3,751,633.86 51.71% amount of taxable income of the
subsidiaries of the Company.
Research and development
39,001,713.24 38,870,289.68 0.34%
investment
Mainly due to increase of
Net cash flow coming from complete sets of Engineering,
-130,589,921.37 -2,594,386.46 -4,933.56%
operating activities with collection period longer
than single equipment.
Mainly due to increase of
Net cash flow coming from payment f or Purchase and
-24,130,819.83 19,644,529.66 -222.84%
investment activities construction of fixed assets and
investment.
Mainly due to increase of cash for
Net cash flow coming from
9,509,627.92 -49,481,272.95 119.22% absorbing investment from equity
fund-raising activities
incentive.
Net increase in cash and cash
-145,466,342.45 -32,417,927.28 -348.72%
equivalents
The profit constitutions or profit sources of the company had an important change in the report
period
□ Applicable √ Not applicable
The profit constitutions or profit sources of the company had no important change in the report
period.
Extension of future development and plan into the report period as disclosed in such public
documents of the company as share-offering prospectus, capital-raising prospectus and assets
reorganization report, etc.
□ Applicable √ Not applicable
In such public documents of the company as share-offering prospectus, capital-raising prospectus
and assets reorganization report, etc. disclosed no extension of future development and plan into the
report period
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
The company reviewed and summarized the progress of the operating plan disclosed in the earlier
stage in the report period.
The Company gains operation revenue of 711.74 million Yuan in first half of 2015, representing
91.66% of the operation goals for first half of 2015, with a y-o-y decrease of 8.15%; total profit
achieved 70.37 million Yuan, realizing the operation goals for first half of 2015, with a y-o-y
decrease of 3.70%.
III. Main business structure
Monetary unit: RMB yuan
Increase/decrease of Increase/decrease Increase/decrease of
operating revenues of operating costs gross profit from the
Operating revenue Operating costs Gross profit
from the same period from the same same period of last
of last year period of last year year
By industry
Refrigeration and Decrease 0.63 perc
703,214,354.35 556,138,449.36 20.91% -7.83% -7.10%
air-conditioning entage points
Increase 21.95 perc
Others 8,525,987.78 6,208,948.56 27.18% -28.57% -45.11%
entage points
By product
Refrigeration and
Decrease 0.63 perc
air-conditioning 703,214,354.35 556,138,449.36 20.91% -7.83% -7.10%
entage points
equipment
Increase 21.95 perc
Others 8,525,987.78 6,208,948.56 27.18% -28.57% -45.11%
entage points
By region
Increase2.06 percen
Northeast China 647,149,794.34 513,779,477.63 20.61% 7.28% 4.56%
tage points
Increase 13.53
East China 13,498,324.64 9,510,226.52 29.55% 12.17% -5.90%
percentage points
Decrease 8.49
Central China 51,092,223.15 39,057,693.77 23.55% -68.00% -64.00%
percentage points
IV. Analysis of core competence
Boasting the most complete cooling and heating product chain in the industry, the Company can
offer to customers the service of package projects from design, manufacture, installation to
maintenance to well meet the customized demand of customers.
Having the mature and perfect marketing network and after-sale service network, the Company can
offer to customers in more regions the more rapid and considerate high-quality service.
Taking refrigeration and air-conditioning as its main business, the Company effectively combines
the independent R&D and the joint ventures and cooperation and has formed a unique development
pattern appropriate to itself and the industry.
In the report period, the Company's core competence was improved further by the actions such as
integration of capital and resources and business model innovation.
V. Analysis of investments
1. External equity investments
(1) External investments
External investments
Investment in the report period (yuan) Investment in the same period of last year (yuan) Amount of variation
1,033,513,959.00 1,023,539,191.23 0.97%
(2) Held financial companies' equity
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Proportion of share
Amount of primary Quantity (Shares) Book value at the
Name of object held equity in that Profit and loss within period
investment held end of period
company
Guotai Junan
30,098,895.00 30,098,895 0.39% 1,032,013,889.41 0.00
Secunities Co., Ltd
Total 30,098,895.00 30,098,895 - 1,032,013,889.41 0.00
(3)Securities investment
□ Applicable √ Not applicable
During the reporting period, the Company does not exist securities investment.
(4) Held other listed companies' equity
□ Applicable √ Not applicable
During the reporting period, the Company does not hole other listed companies’ equity.
2. Trust management, derivative investments, and entrusted loans
(1)Trust management
□ Applicable √ Not applicable
During the reporting period, the Company does not exist trust management.
(2)Derivative investment
□ Applicable √ Not applicable
During the reporting period, the Company does not exist derivative investment.
(3)Entrusted loans
□ Applicable √ Not applicable
During the reporting period, the Company does not exist entrusted loans.
3. The use of funds raised
□ Applicable √ Not applicable
During the reporting period, the Company does not exist the use of funds raised.
4. Analysis of major subsidiary companies and mutual shareholding companies
Monetary unit: thousand yuan
Registered Operating Net
Name Type Main product Total assets Net assets
capital revenue profit
Panasonic Compressor mutual Semi-hermetic, and
JPY6,200,000 1,832,998 1,076,292 985,412 80,005
(Dalian) Co., Ltd. shareholding scroll compressor
Dalian Fuji-Bingshan Vending Mutual Producing and selling
JPY1,800,000 353,492 208,791 209,861 25,329
Machine Co., Ltd. shareholding vending machines
Keinin-Grand Ocean Thermal
Mutual
Technology (Dalian) Co., Air-conditioner for cars USD15,120.00 365,615 201,733 334,917 38,064
shareholding
Ltd.
VI. Estimation of the business performance for Jan.-Sept., 2015
Estimation notice that the accumulated net profit from the beginning of year to the end of the next
reporting period may be turned into loss or significantly change compared with the same period of
the last year, and explanation of the cause
□ Applicable √ Inapplicable
VII. Explain to the “non standard audit report” from the board of directors,
board of supervisors of the Company
Not applicable.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
VIII. Explain to the “non standard audit report” for last year from the board of
directors of the Company
Not applicable.
IX. Profit distribution and dividend payment
By giving consideration to both the return to shareholders and the Company's long-term
development, and in combination of the Company's profit made in the this year, the Company
formulated the 2014 annual dividend distribution plan of paying the cash of 1.5 yuan for every 10
shares. Reviewed and adopted at the Company's general meeting, the Company's Board of Directors
has implemented the plan in June 2015.
Special explanation of the cash dividend distribution policy
Did it comply with the Company's Articles of Association or the
Yes
resolutions at the general meeting?
Were the dividend distribution standard and proportion defined
Yes
and clear?
Were the decision-making procedure and system complete? Yes
Did the independent directors play their role conscientiously? Yes
Did the minority shareholders have opportunities to fully express
their opinions and appeals? Were their legal rights and interests Yes
protected fully?
Were the condition and procedure for adjustment or change of
Yes
the cash dividend distribution policy compliant and transparent?
X. Profit distribution preplan, and preplan of share-granting with capital
accumulation fund of the Company for the reporting period
Not applicable.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
XI. Record of investigation, communication, interview and other activities in the
reporting period
Main content
Reception Reception Reception talked about and
Reception time Reception object
place mode object type information
provided
He Siyuan from HUACHUANG SECURITIES Co., Ltd.; Wu Yang from
E FUND MANAGEMENT Co., Ltd.; An Qian from Fullgoal Fund
Management Co., Ltd.; Zhang Wei from Bank of Communications
Company's Field Schroder Fund Management Co., Ltd. Xiao Qunxi from HUATAI
Jan. 14, 2015 Institution
office investigation SECURITIES; Wan Fangfang from CHINA ASSET MANAGEMENT
CO.,LTD. Zhang Yu from TIANHONG MANAGEMENT Co., Ltd; Cai
Yi from Everbright Pramerica Fund Management Co., Ltd; Zhu Yuanfeng
from SHANGHAI HUILI ASSET MANAGEMENT CO.,LTD.;
Xu Jianhua from ORIENT SECURITIES CO.,LTD.; Zhang Zhao from
Company's Field
Jan. 16, 2015 Institution GF FUND MANAGEMENT CO.,LTD.; He Yiguang from GREAT
office investigation
WALL FUND MANAGEMENT CO.,LTD.
Company's Field
Jan. 19, 2015 Institution Yu Huiling from Karst Peak Capital Limited.
office investigation
Li Ming from GUOYUAN SECURITIES (HONG KONG); Wang Rui
Company's
Jan.27, 2015 By telephone Institution from Panther Asset Management Co., Ltd. Li Ran from South China
office
Growth Fund; Chen Changfeng from Valued Capital Ltd.
Company's Field
Mar. 17, 2015 Institution Huang Zhiqing from Heartland Capital Investment(Shanghai) Co., Ltd.
Company
office investigation
Xu Jianhua and She Weichao from ORIENT SECURITIES CO.,LTD.; fundamentals
Huang Kun from GUOTAI JUNAN SECURITIES; Wang Qun from having been
FORTUNE SECURITIES CO.,LTD. He Siyuan from HUA CHUANG publicly
SECURITIES; Hu Haofeng from HUATAI SECURITIES CO.,LTD; Shu disclosed
Hao from HUAAN FUND; Chen Linhai from Huatai-Pine Bridge
Company's Field
Apr. 28, 2015 Institution Investment; Chensi from ESSENCE FUND; Qifei from Changxin Asset
office investigation
Management; Pan Mingxi from Guotai Asset Managemen; Zhangqiang
from MINSHENG ROYAL FUND MANAGEMENT CO.,LTD. Chengjin
from Franklin Templeton Sealand Fund Management Co., Ltd; Liu
Dongxin from INFORE CAPITAL CO.,LTD. ; Suxuan from Kai Sibo
investment manangment Co.,Ltd.
Company's Field
May. 7, 2015 Institution Miao Huaxin from PAG
office investigation
Company's He Siyuan from HUA CHUANG SECURITIES; Xiu Shiyu from ICBC
May. 15, 2014 By telephone Institution
office
Credit Suisse Asset Management Co., Ltd.
Company's
Jun. 9, 2015 By telephone Institution Xiao Qunxi from HUATAI Securities.
office
Company's Field He Siyuan from HUA CHUANG SECURITIES; Zhang Qiang from
Jun. 11, 2015 Institution
office investigation UNO FUND MANAGEMENT CO.,LTD.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 5 Important Issues
I. Company governing
On Feb. 12, 2015, the Company convened its 1st extraordinary shareholders’ general meeting in
2015 and by-elected Dai Dashuang, Liu Jiwei as the independent directors of the Company.
On May 20, 2015, the Company convened its 2014 shareholders’ general meeting and elected Wang
Yan as the independent director of the Company.
The actual situation of company governing has no difference from the Company Law and the
requirements of relevant regulations of China Securities Regulatory Commission.
II. Major lawsuit and arbitration issues
□ Applicable √ Not applicable
The Company had no major lawsuit and arbitration issues in the reporting period.
III. Media's queries
□ Applicable √ Not applicable
There were no media's queries to the Company in the reporting period.
IV. Bankruptcy restructuring related matters
□ Applicable √ Not applicable
There were no bankruptcy restructuring related matters to the Company in the reporting period.
V. Important transactions
1. Purchases of important assets
√ Applicable □ Not applicable
Within reporting period, the Company acquired 30% equity of Dalian Sanyo High-Efficient
Refrigeration System Co., Ltd. from Sanyo Electric Co., Ltd., with the price of 26.99 million yuan.
The announcement about the equity transfer (announcement number: 2015-032) was published on
B038 of China Securities, A7 of HK Commercial Daily and Cninfo website.
Within reporting period, the Company acquired 19% equity of Wuhan New World Refrigeration
Industrial Co., Ltd. from Dalian Bingshan Group, acquired 30% equity of Wuhan New World
Refrigeration Industrial Co., Ltd. from Sanyo Electric Co., Ltd., with the price of 66.99 millions
yuan. The announcement about the equity transfer (announcement number: 2015-039) was
published on B043 of China Securities, A7 of HK Commercial Daily and Cninfo website.
2. Sales of important assets
□ Applicable √ Not applicable
There were no sales of important assets matters of the Company in this reporting period.
3. Enterprise merger
□ Applicable √ Not applicable
There were no enterprise merger matters to the Company in this reporting period.
VI. The implementation and effect of equity incentive
√Applicable □ Not applicable
On December 2014, The Company launched the first phase of restricted stock incentive plan,
intending to grant 10, 150 thousand shares restricted stock to the 41 incentive objects. On January,
2015, the CSRC conformed and recorded without objection to the restricted stock incentive plan
draft. On February, 2015, the 1st Extraordinary Shareholders’ General Meeting of 2015 of the
Company examined and adopted the restricted stock incentive plan draft of the Company and its
summary. On March 2015, the Board has implemented and completed granting the restricted stock.
For details, please see the series announcement on China Securities, HK Commercial Daily and
Cninfo website.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
VII. Important associated transactions
1. Associated transactions related to normal business
In the reporting period, the total amount of normal associated transactions between the Company
and associated parties was 149,630 thousand yuan, accounting for 31.17% of the budgeted amount
for the year 2015. This included 58,370 thousand yuan, accounting for 27.80% of the budgeted
amount for the year 2015, for purchasing supporting products for package projects from associated
parties, and 91,260 thousand yuan, accounting for 33.80% of the budgeted amount for the year 2015,
from selling supporting parts and components to associated parties.
2. Associated transactions related to purchases or sales of assets
Within reporting period, the Company acquired 30% equity of Dalian Sanyo High-Efficient
Refrigeration System Co., Ltd. from Sanyo Electric Co., Ltd., with the price of 26.99 million yuan.
Sanyo Electric Co., Ltd. is the second larger shareholder of the Company, thus constitute associated
transaction. The announcement about the equity transfer (announcement number: 2015-032) was
published on B038 of China Securities, A7 of HK Commercial Daily and Cninfo website.
Within reporting period, the Company acquired 19% equity of Wuhan New World Refrigeration
Industrial Co., Ltd. from Dalian Bingshan Group Co., Ltd., acquired 30% equity of Wuhan New
World Refrigeration Industrial Co., Ltd. from Sanyo Electric Co., Ltd., with the price of 66.99
millions yuan. Dalian Bingshan Group Co., Ltd. is the controlling shareholder of the Company, and
Sanyo Electric Co., Ltd. is the second larger shareholder of the Company, thus constitute associated
transaction. The announcement about the equity transfer (announcement number: 2015-039) was
published on B043 of China Securities, A7 of HK Commercial Daily and Cninfo website.
3. Important associated transactions with joint external investments
□ Applicable √ Not applicable
4. Current associated rights of credit and liabilities
Were there current non-operating associated rights of credit and liabilities?
□ Applicable √ Not applicable
5. Other associated transactions
□ Applicable √ Not applicable
VIII. The non operating funds occupancy to the listing company by controlling
shareholder and its related party
□ Applicable √ Not applicable
IX. Important contracts and its performance
1. Trusting, contracting and leasing status
(1) Trusting status
□ Applicable √ Not applicable
There was no trusting status with the Company in the reporting period.
(2) Contracting status
□ Applicable √ Not applicable
There was no contracting status with the Company in the reporting period.
16
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(3) Leasing status
√ Applicable □Not applicable
The company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co., Ltd., and rent #
6 workshop building located on No. 106 Liaohe East Rd, Dalian Economic and Technology
Development Zone to MHI Bingshan Refrigeration (Dalian) Co., Ltd. The rental area is 15,259.04
square meters, and the rental term till 16th July, 2029. The annual rent fee is RMB 4.2 million after
considering the time value of money.
2. Guaranteeing status
□ Applicable √ Not applicable
There was no guaranteeing status with the Company in the reporting period.
3. Other important contracts
□ Applicable √ Not applicable
The Company had no other important contracts in the reporting period.
X. Implementation of commitments
1. Commitments of the Company or its shareholders holding 5% or higher of the shares in the
reporting period or carried to the reporting period
The implementation for management equity incentive plan has been performed currently.
XI. The appointment and dismissal of accounting firms
Does the semi-annual financial report has been audited?
□ Applicable √ Not applicable
The semi-annual financial report has not been audited.
XII. Punishment and rectification
□ Applicable √ Not applicable
XIII. Illegal delisting Risk Disclosure
□ Applicable √ Not applicable
XIV. Other important matters
□ Applicable √ Not applicable
XV. Index to the information announcements for major matters in the report
period
Announcement Newspaper name and page for Publishing Website and path
No. Item
publishing date for publishing
Public Notice on Receiving
Record without Objection from China Securities Daily B030, Hong
2015-001 Jan. 10, 2015 http://www.cninfo.com.cn
CSRC to the Restricted stock Kong Commercial Daily A16
Incentive Plan Draft.
Announcement of the
China Securities Daily B060, Hong
2015-002 resolutions at the 14th meeting of Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
the 6th Board of Directors
Notice on convening the 1st
China Securities Daily B060, Hong
2015-003 extraordinary general meeting in Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
2015.
Statement of the Independent
China Securities Daily B060, Hong
2015-004 directors candidates(Dai Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
Dashuang)
17
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Statement of the Independent China Securities Daily B060, Hong
2015-005 Jan. 23, 2015 http://www.cninfo.com.cn
directors candidates(Liu Jiwei) Kong Commercial Daily A18
Statement of the Independent
China Securities Daily B016, Hong
2015-006 directors nominee(To Dai Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A14
Dashuang)
Statement of the Independent China Securities Daily B016, Hong
2015-007 Jan. 23, 2015 http://www.cninfo.com.cn
directors nominee(To Liu Jiwei) Kong Commercial Daily A14
Report on the Independent
China Securities Daily B060, Hong
2015-008 directors public solicitation of a Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
proxy vote
China Securities Daily B016, Hong
2015-009 Estimated Performance for 2014 Jan. 23, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A14
Precautions Notice on Holding
the1stExtraordinary China Securities Daily B016, Hong
2015-010 Feb. 06, 2015 http://www.cninfo.com.cn
Shareholders’ Kong Commercial Daily A14
General Meeting of 2015
Announcement of the
resolutions at the 1st China Securities Daily A37, Hong
2015-011 Feb. 13, 2015 http://www.cninfo.com.cn
extraordinary general meeting in Kong Commercial Daily A10
2015
Announcement of the
China Securities Daily B002, Hong
2015-012 resolutions at the 15th meeting of Mar. 05, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily B4
the 6 Board of Directors
Announcement of the
China Securities Daily B002, Hong
2015-013 resolutions at the 9th meeting of Mar. 05, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily B4
the 6 Board of Supervisors
Resolution of granting restricted China Securities Daily B002, Hong
2015-014 Mar. 05, 2015 http://www.cninfo.com.cn
stock to incentive object Kong Commercial Daily B4
Public Notice on Being
China Securities Daily A16, Hong
2015-015 Identified as High-tech Mar. 20, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A10
Enterprise
Public Notice on Completion of China Securities Daily B007, Hong
2015-016 Mar. 25, 2015 http://www.cninfo.com.cn
Granting Restricted Stock Kong Commercial Daily A18
China Securities Daily B054, Hong
2015-017 2014 Annual Report Summary Apr 24, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
Announcement of the
China Securities Daily B054, Hong
2015-018 resolutions at the 16th meeting of Apr 24, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily A18
the 6 Board of Directors
Announcement of the
China Securities Daily B054, Hong
2015-019 resolutions at the 10th meeting of Apr 24, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily A18
the 6 Board of Supervisors
2015-020 Notice on convening the 2014 China Securities Daily B054, Hong
Apr 24, 2015 http://www.cninfo.com.cn
annual general meeting Kong Commercial Daily A18
2015-021 Announcement of the 2015
China Securities Daily B054, Hong
annual estimation of routine Apr 24, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A18
associated transactions
2015-022 Quarterly Report for the First China Securities Daily B054, Hong
Apr 24, 2015 http://www.cninfo.com.cn
Quarter, 2015 Kong Commercial Daily A18
2015-023 Statement of the Independent China Securities Daily B054, Hong
Apr 24, 2015 http://www.cninfo.com.cn
directors candidates(Wang Yan) Kong Commercial Daily A19
2015-024 Statement of the Independent
China Securities Daily B054, Hong
directors nominee(To Wang Apr 24, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A19
Yan)
2015-025 Public Notice on Not Having China Securities Daily B054, Hong
Apr 24, 2015 http://www.cninfo.com.cn
Actual Controller Kong Commercial Daily A19
2015-026 Precautions Notice on Holding China Securities Daily B054, Hong
May. 14, 2015 http://www.cninfo.com.cn
the 2014 annual general meeting Kong Commercial Daily A19
2015-027 Announcement of the
China Securities Daily B080, Hong
resolutions at the 2014 annual May. 21, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A7
general meeting
18
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2015-028 Public Notice on Trade
Suspension Brought by Planning China Securities Daily B014, Hong
May. 25, 2015 http://www.cninfo.com.cn
Private Kong Commercial Daily A6
Issuing of A-shares
2015-029 Public Notice on Progress of
China Securities Daily B003, Hong
Planning Private Issuing of Jun.01, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A15
A-shares Matters
2015-030 Announcement of the
China Securities Daily B038, Hong
resolutions at the 17th meeting of Jun.05, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily A13
the 6 Board of Directors
2015-031 Notice on convening the 2st
China Securities Daily B038, Hong
extraordinary general meeting in Jun.05, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A13
2015.
Public Notice on Related
Transaction of Equity Transfer China Securities Daily B038, Hong
2015-032 Jun.05, 2015 http://www.cninfo.com.cn
ofDalian Sanyo High-Efficient Kong Commercial Daily A13
Refrigeration System Co., Ltd.
2015-033 Public Notice on Trade
Resumption Brought by China Securities Daily B038, Hong
Jun.05, 2015 http://www.cninfo.com.cn
Planning Private Issuing of Kong Commercial Daily A13
A-shares
2015-034 Public Notice on the completion
China Securities Daily B038, Hong
of the change of business Jun.05, 2015 http://www.cninfo.com.cn
Kong Commercial Daily A13
registration.
2015-035 Public Notice of Dividend China Securities Daily B032, Hong
Jun.16, 2015 http://www.cninfo.com.cn
Distribution for year of 2014 Kong Commercial Daily A17
Precautions Notice on Holding
the 2nd Extraordinary China Securities Daily B032, Hong
2015-036 Jun.16, 2015 http://www.cninfo.com.cn
Shareholders’ Kong Commercial Daily A17
General Meeting of 2015
2015-037 Announcement of the
resolutions at the 2st China Securities Daily B043, Hong
Jun.25, 2015 http://www.cninfo.com.cn
extraordinary general meeting in Kong Commercial Daily A7
2015
2015-038 Announcement of the
China Securities Daily B043, Hong
resolutions at the 18th meeting of Jun.25, 2015 http://www.cninfo.com.cn
th Kong Commercial Daily A7
the 6 Board of Directors
Public Notice on Related
Transaction of Equity Transfer
of China Securities Daily B043, Hong
2015-039 Jun.25, 2015 http://www.cninfo.com.cn
Wuhan New World Kong Commercial Daily A7
Refrigeration Industrial Co.,
Ltd.
Public Notice on Related China Securities Daily B043, Hong
2015-040 Jun.25, 2015 http://www.cninfo.com.cn
Transaction of Rental Housing Kong Commercial Daily A7
Public Notice of after the
completement of Dividend
Distribution for year of 2014 to China Securities Daily B014, Hong
2015-041 Jun.30, 2015 http://www.cninfo.com.cn
Adjustment of the reserve price Kong Commercial Daily A7
and the number of shares issued
for Private Issuing of A-shares
19
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 6 Change in Share Capital and Shareholders'
Information
I. Change in share capital
1. Change in share capital
Shares Shares
（before change） （after change）
items Changes
number proportion number proportion
I. Non-circulating share capital with
19,224,451 5.50% 10,150,000 29,374,451 8.16%
restricted trade conditions
3. Other domestic shares 19,224,451 5.50% 10,150,000 29,374,451 8.16%
Including: Shares held by domestic
19,213,921 5.49% 19,213,921 5.33%
legal person
Including: Shares held by
10,530 0.01% 10,150,000 10,160,530 2.82%
domestic natural person
II. Circulating share capital 330,790,524 94.50% 330,790,524 91.84%
1. Domestically listed
215,790,524 61.64% 215,790,524 59.91%
ordinary shares
2. Domestically listed
115,000,000 32.86% 115,000,000 31.93%
foreign shares
III. Total shares 350,014,975 100.00% 10,150,000 360,164,975 100.00%
2. The reason for the Change in share capital
The Company launched the first phase of restricted stock incentive plan，award the 41 equity
incentive objects with restricted shares amounting to 10,150,000 shares.
II. Number of shareholders and their shareholding
Total number of shareholders in the reporting period 31,725
Shareholding of top ten shareholders
Number of
Number of
pledged
Proport Total shares with
Name Nature shares or
ion number sale
shares
restriction
frozen
Domestic non-state-owned
Dalian Bingshan Group Co., Ltd. 21.34% 76,855,683 19,213,921
legal person
Sanyo Electric Co., Ltd. Overseas legal person 9.72% 35,001,500
Lion flexible configuration hybrid securities
Others 1.76% 6,350,263
investment fund
Fu Guo Zhong Zheng Reform of state owned
enterprise index Classification . Securities Others 1.53% 5,523,854
Investment Fund
Domestic non-state-owned
Tibet Aier Medical Investment Co., Ltd 1.10% 3,965,000
legal person
Lin Zhenming Overseas natural person 0.73% 2,634,000
Sun Huiming Domestic natural person 0.68% 2,449,016
Jiang Youchang Domestic natural person 0.64% 2,300,448
Domestic non-state-owned
Dalian City Industrial Investment Co., Ltd. 0.45% 1,622,250
legal person
JOHCM INTERNATIONAL SMALL CAP
Overseas legal person 0.41% 1,470,786
EQUITY FUND
20
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Shareholding of top ten shareholders without sale restriction
Number of shares without sale
Name Type of shares
restriction
RMB denominated ordinary
Dalian Bingshan Group Co., Ltd. 57,641,762
shares
Domestically listed foreign
Sanyo Electric Co., Ltd. 35,001,500
shares
RMB denominated ordinary
Lion flexible configuration hybrid securities investment fund 6,350,263
shares
Fu Guo Zhong Zheng Reform of state owned enterprise index RMB denominated ordinary
5,523,854
Classification . Securities Investment Fund shares
RMB denominated ordinary
Tibet Aier Medical Investment Co., Ltd 3,965,000
shares
Domestically listed foreign
Lin Zhenming 2,634,000
shares
Domestically listed foreign
Sun Huiming 2,449,016
shares
RMB denominated ordinary
Jiang Youchang 2,300,448
shares
RMB denominated ordinary
Dalian City Industrial Investment Co., Ltd. 1,622,250
shares
Domestically listed foreign
JOHCM INTERNATIONAL SMALL CAP EQUITY FUND 1,470,786
shares
Dalian Bingshan Group Co., Ltd. had the association
Notes to the associated relationship and uniform actions of the relationship with Sanyo Electric Co., Ltd. among the above
above shareholders shareholders. Sanyo Electric Co., Ltd. holds 30% of Dalian
Bingshan Group Co., Ltd.'s equity.
If the company shareholders had any agreed repurchase transaction in the report period
□ Yes √ No
III. Variation in controlling shareholders or actual controllers
Variation in controlling shareholders in the report period
□ Applicable √ Not applicable
There were no changes in the controlling shareholder in the reporting period.
Variation in actual controllers in the report period
√ Applicable □ Not applicable
According to the actual situation of Dalian Refrigeration Co., Ltd. and its controlling shareholders,
and compared with the related laws and regulations, with the confirmation of Liaoning Huaxia law
firm, the Company released the Public Notice on Not Having Actual Controller.(No: 2015-025),)
which was published on B04 of China Securities, A19 of HK Commercial Daily and Cninfo website
on April 24 2015.
IV. Stock holdings plan from the Company’s shareholders in the report period
□ Applicable √ Not applicable
21
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 7 Information on Preferred Stock
□ Applicable √ Not applicable
In the reporting period, the Company didn’t own preferred stock.
22
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 8 Information on the Company’s Directors,
Supervisors, and Senior Management officers
I. Changes in shareholding by directors, supervisors and senior managers
√Applicable □ Not applicable
Increase on holding Decrease in Shares held at
Shares held at
Office-holding of shares in this holding of shares the end of
Name Position beginning of period
state period in this period period
(shares)
(shares) (share) (shares)
Ji Zhijian Chairman Incumbent 0 942,300 0 942,300
Xu Junrao Director Incumbent 3,900 659,600 0 663,500
Liu Kai Director, GM Incumbent 0 659,600 0 659,600
Wang Zhiqiang Director, DGM Incumbent 0 376,900 0 376,900
Kobayashi Noriaki Vice Chairman Incumbent 0 0 0 0
Kijima Tadatoshi Director Incumbent 0 0 0 0
Independent
Liu Caiping Leaving office 0 0 0 0
director
Independent
Wang Huiquan Leaving office 0 0 0 0
director
Independent
Xing Tiancai Leaving office 0 0 0 0
director
Independent
Dai Dashuang Incumbent 0 0 0 0
director
Independent
Liu Jiwei Incumbent 0 0 0 0
director
Independent
Wang Yan Incumbent 0 0 0 0
director
Chairman of Board
Yu Fuchun Incumbent 10,140 0 0 10,140
of Supervisors
Mao Chunhua Supervisor Incumbent 0 0 0 0
Ma Yun Supervisor Incumbent 0 0 0 0
Financial
Rong Yan Incumbent 0 376,900 0 376,900
Majordomo
Li Wenjiang DGM Incumbent 0 376,900 0 376,900
Song Wenbao Board secretary Incumbent 0 282,800 0 282,800
Total -- -- 14,040 3,675,000 0 3,689,040
II. Resignation, dismissal and election, engagement of company directors,
supervisors, senior management officers
Name Position assumed Type Date Reason
Leaving office when
Independent
Liu Caiping expiration of the term of May 20, 2015 expiration of the term of office
director
office
Independent
Wang Huiquan Leaving office Feb. 12, 2015 Resigned according to the relevant requirement
director
Independent
Xing Tiancai Leaving office Feb. 12, 2015 Resigned according to the relevant requirement
director
Independent
Dai Dashuang Be elected Feb. 12, 2015 The general meeting of shareholders by election
director
Independent
Liu Jiwei Be elected Feb. 12, 2015 The general meeting of shareholders by election
director
Independent
Wang Yan Be elected May 20, 2015 The general meeting of shareholders to election
director
23
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 9 Financial report
I. The Company's semiannual financial report has not been audited.
II. Accounting statement
BALANCE SHEET
Prepared by Dalian Refrigeration Co., Ltd. June 30, 2015 Unit: RMB Yuan
30-June-2015 31-Dec-2014
Assets
Consolidation Parent Company Consolidation Parent Company
Current assets:
Monetary funds 365,011,773.84 260,938,973.86 508,511,466.02 407,573,197.89
Financial assets which are measured by fair value and
which changes are recorded in current profit and loss
Derivative financial assets
Notes receivable 48,780,136.31 40,794,557.06 14,855,957.70 15,711,896.93
Accounts receivable 566,710,020.31 277,942,840.42 438,880,830.12 205,307,502.60
Accounts in advance 42,581,468.71 22,619,683.04 19,053,269.75 8,470,706.14
Interest receivables 2,491,608.34 2,491,608.34 4,998,982.40 4,998,982.40
Dividend receivable 39,200,000.00 43,115,784.39
Other receivables 40,188,760.41 22,774,783.60 34,266,444.02 21,265,905.54
Inventories 292,455,943.91 146,700,214.72 314,879,106.56 164,069,128.20
Assets held for sale
Non-current asset due within one year
Other current assets 1,428,520.15 786,802.37 2,335,139.79 1,659,559.91
Total current assets 1,398,848,231.98 818,165,247.80 1,337,781,196.36 829,056,879.61
Non-current assets:
Finance asset held available for sales 1,045,925,548.00 1,044,610,405.50 42,428,388.70 41,113,246.20
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 1,033,513,959.00 1,159,105,764.57 1,039,229,738.85 1,146,858,810.27
Investment property 24,803,246.50 24,803,246.50 25,108,909.00 25,108,909.00
Fixed assets 399,179,806.10 229,357,152.23 414,293,269.31 239,721,541.76
Construction in progress 44,351,507.90 34,967,564.89 18,515,449.46 18,280,777.19
Engineering material
Disposal of fixed asset
Productive biological asset
Oil and gas asset
Intangible assets 151,902,168.86 88,685,242.89 153,913,310.25 89,919,836.54
Expense on Research and Development
Goodwill
Long-term expenses to be apportioned 5,134,146.97 4,806,907.98 5,873,398.99 5,537,394.66
Deferred income tax asset 18,455,439.11 7,756,556.37 16,786,587.33 8,054,057.26
Other non-current asset
Total non-current asset 2,723,265,822.44 2,594,092,840.93 1,716,149,051.89 1,574,594,572.88
Total assets 4,122,114,054.42 3,412,258,088.73 3,053,930,248.25 2,403,651,452.49
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Mao Chunhua
24
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
BALANCE SHEET (CONTINUED)
Prepared by Dalian Refrigeration Co., Ltd. June 30, 2015 Unit: RMB Yuan
30-June-2015 31-Dec-2014
Liabilities and shareholders’ equity
Consolidation Parent Company Consolidation Parent Company
Current liabilities:
Short-term loans 60,000,000.00 60,000,000.00
Derivative financial liabilities
Notes payable 120,832,581.67 91,596,784.50 109,546,502.61 66,979,512.02
Accounts payable 545,355,348.00 308,429,134.56 511,076,537.82 302,053,679.95
Accounts received in advance 104,820,567.76 37,895,560.18 137,629,315.42 96,325,866.23
Wage payable 31,143,560.46 2,690,798.91 55,993,637.27 13,854,152.86
Taxes payable 17,205,482.56 3,404,861.70 2,642,729.69 -2,710,393.15
Interest payable
Dividend payable 2,643,678.92 533,156.00 533,156.00 533,156.00
Other accounts payable 59,512,717.45 20,578,331.35 60,075,814.04 49,270,430.42
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 941,513,936.82 465,128,627.20 937,497,692.85 526,306,404.33
Non-current liabilities:
Long-term loans
Bonds payable
Long-term account payable
Long-term wage payable
Special accounts payable
Projected liabilities
Deferred income 50,227,845.00 3,996,845.00 52,773,884.19 5,985,884.19
Deferred income tax liabilities 150,524,573.90 150,524,573.90
Other non-current liabilities
Total non-current liabilities 200,752,418.90 154,521,418.90 52,773,884.19 5,985,884.19
Total liabilities 1,142,266,355.72 619,650,046.10 990,271,577.04 532,292,288.52
Shareholders’ equity
Share capital 360,164,975.00 360,164,975.00 350,014,975.00 350,014,975.00
Other equity instruments
Capital public reserve 633,448,214.29 633,448,214.29 582,288,006.29 582,288,006.29
Specialized reserve
Other comprehensive income 855,740,872.12 854,511,944.50 2,768,286.72 1,539,359.10
Special preparation
Surplus public reserve 568,167,243.90 568,167,243.90 545,788,247.99 545,788,247.99
Retained profit 474,241,996.29 376,315,664.94 486,167,740.13 391,728,575.59
Translation of foreign currency capital
Total owner’s equity attributable to parent
2,891,763,301.60 2,792,608,042.63 1,967,027,256.13 1,871,359,163.97
company
Minority interests 88,084,397.10 96,631,415.08
Total owner’s equity 2,979,847,698.70 2,792,608,042.63 2,063,658,671.21 1,871,359,163.97
Total liabilities and shareholder’s equity 4,122,114,054.42 3,412,258,088.73 3,053,930,248.25 2,403,651,452.49
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
25
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
INCOME STATEMENT
Prepared by Dalian Refrigeration Co., Ltd. January-June, 2015 Unit: RMB Yuan
January-June, 2015 January-June, 2014
Items
Consolidation Parent Company Consolidation Parent Company
I. Total sales 711,740,342.13 299,875,171.09 774,912,253.19 470,970,219.97
Including: Operating income 711,740,342.13 299,875,171.09 774,912,253.19 470,970,219.97
II. Total operating cost 692,522,643.78 291,977,877.31 763,013,964.64 467,279,899.71
Including: Operating cost 562,347,397.92 247,322,955.72 609,950,440.82 386,947,532.84
Taxes and associate charges 5,466,860.36 1,160,192.70 6,469,418.81 3,082,292.41
Selling and distribution expenses 35,327,320.58 1,506,513.32 48,901,400.51 25,191,223.59
Administrative expenses 88,737,103.40 51,690,825.61 89,762,782.36 50,581,629.55
Financial expense -1,831,323.45 -3,950,961.70 -3,797,684.83 -5,176,060.33
Impairment loss 2,475,284.97 -5,601,648.34 11,727,606.97 6,653,281.65
Add: Gain/(loss) from change in fair value
Gain/(loss) from investment 48,393,081.52 52,308,865.91 56,334,258.74 58,434,258.74
Including: income form investment on affiliated
48,083,081.52 48,083,081.52 53,897,497.58 53,897,497.58
enterprise and jointly enterprise
III. Operating profit 67,610,779.87 60,056,159.69 68,232,547.29 62,124,579.00
Add: non-business income 2,768,512.07 2,043,822.27 5,049,995.17 4,294,350.32
Including: profit from non-current asset disposal 28,868.06 9,807.69 2,044.63 1,084.63
Less: non-business expense 4,465.70 437.18 206,820.12 104,144.94
Including: loss from non-current asset disposal 2,394.33 437.18 129,041.96 54,144.94
IV. Total profit 70,374,826.24 62,099,544.78 73,075,722.34 66,314,784.38
Less: Income tax 5,691,645.31 1,108,713.27 3,751,633.86 2,100,279.73
V. Net profit 64,683,180.93 60,990,831.51 69,324,088.48 64,214,504.65
Net profit attributable to parent company 65,477,775.99 60,990,831.51 66,477,633.28 64,214,504.65
Minority shareholders’ gains and losses -794,595.06 2,846,455.20
VI. After-tax net amount of other comprehensive
852,972,585.40 852,972,585.40 -11,250.00 -11,250.00
incomes
After-tax net amount of other comprehensive
852,972,585.40 852,972,585.40 -11,250.00 -11,250.00
incomes attributable to owners of the Company
(I) Other comprehensive incomes that will not be
reclassified into gains and losses
1. Changes in net liabilities or assets with a
defined benefit plan upon re-measurement
2. Enjoyable shares in other comprehensive
incomes in investees that cannot be reclassified
into gains and losses under the equity method
……
(II) Other comprehensive incomes that will be
852,972,585.40 852,972,585.40 -11,250.00 -11,250.00
reclassified into gains and losses
1. Enjoyable shares in other comprehensive
incomes in investees that will be reclassified into -11,250.00 -11,250.00
gains and losses under the equity method
2. Gains and losses on fair value changes of
852,972,585.40 852,972,585.40
available-for-sale financial assets
3. Gains and losses on reclassifying
held-to-maturity investments into
available-for-sale financial assets
4. Effective hedging gains and losses on cash
flows
5. Foreign-currency financial statement
translation difference
6. Other
26
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
……
After-tax net amount of other comprehensive
incomes attributable to minority shareholders
VII Total comprehensive income 917,655,766.33 913,963,416.91 69,312,838.48 64,203,254.65
Total comprehensive income attributable to
918,450,361.39 913,963,416.91 66,466,383.28 64,203,254.65
parent company
Total comprehensive income attributable to
-794,595.06 2,846,455.20
minority shareholders
VIII. Earnings per share
(I) basic earnings per share 0.18 0.19
(II) diluted earnings per share 0.18 0.19
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
27
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
CASH FLOW STATEMENT
Prepared by Dalian Refrigeration Co., Ltd. January -June, 2015 Unit: RMB Yuan
January -June, 2015 January -June, 2014
Items
Consolidation Parent Company Consolidation Parent Company
I. Cash flows arising from operating
activities:
Cash received from selling commodities
526,979,719.10 298,992,839.09
and providing labor services 382,614,969.22 109,026,091.80
Write-back of tax received 745,652.66 38,095.13
Other cash received concerning operating
15,112,738.10 9,419,307.14 23,780,067.97 17,828,305.25
activities
Subtotal of cash inflow arising from
398,473,359.98 118,445,398.94 550,797,882.20 316,821,144.34
operating activities
Cash paid for purchasing commodities and
272,348,733.40 146,775,719.87 281,731,145.25 189,500,108.92
receiving labor service
Cash paid to/for staff and workers 152,175,815.25 66,965,526.52 154,450,749.32 90,376,223.25
Taxes paid 38,023,028.19 11,822,825.39 64,623,975.30 34,997,096.61
Other cash paid concerning operating
66,515,704.51 21,159,867.78 52,586,398.79 35,942,188.52
activities
Subtotal of cash outflow arising from
529,063,281.35 246,723,939.56 553,392,268.66 350,815,617.30
operating activities
Net cash flows arising from operating
-130,589,921.37 -128,278,540.62 -2,594,386.46 -33,994,472.96
activities
II. Cash flows arising from investing
activities:
Cash received from recovering investment 15,000,000.00 15,000,000.00
Cash received from investment income 19,113,061.37 19,113,061.37 20,655,571.40 20,622,121.40
Net cash received from disposal of fixed,
55,285.00 10,000.00 93,105.00
intangible and other long-term assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning investing
0.00
activities
Subtotal of cash inflow from investing
19,168,346.37 19,123,061.37 35,748,676.40 35,622,121.40
activities
Cash paid for purchasing fixed, intangible
29,845,066.20 19,426,933.55 16,104,146.74 9,309,283.62
and other long-term assets
Cash paid for investment 13,454,100.00 22,166,934.15
Net cash received from payment of
subsidiaries and other business units
Other cash paid concerning investing
0.00
activities
Subtotal of cash outflow from
43,299,166.20 41,593,867.70 16,104,146.74 9,309,283.62
investing activities
Net cash flows arising from investing
-24,130,819.83 -22,470,806.33 19,644,529.66 26,312,837.78
activities
III. Cash flows arising from financing
activities
Cash received from absorbing investment 60,434,000.00 56,434,000.00
Including: Cash received from absorbing
minority shareholders' equity investment by 4,000,000.00
subsidiaries
Cash received from loans 27,360,000.00 7,400,000.00
Other cash received concerning financing
32,953,876.63 16,145,665.64 0.00
activities
Subtotal of cash inflow from financing
120,747,876.63 72,579,665.64 7,400,000.00
activities
Cash paid for settling debts 21,760,000.00 3,900,000.00
Cash paid for dividend and profit
54,557,721.81 52,031,349.57 52,941,288.95
distributing or interest paying 50,624,979.28
28
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Including: dividends or profit paid by
392,000.00 1,500,000.00
subsidiaries to minority shareholders
Other cash paid concerning financing
34,920,526.90 20,975,652.64 39,984.00
activities
Subtotal of cash outflow from
111,238,248.71 73,007,002.21 56,881,272.95 50,624,979.28
financing activities
Net cash flows arising from financing
9,509,627.92 -427,336.57 -49,481,272.95 -50,624,979.28
activities
IV. Influence on cash due to fluctuation in
-255,229.17 -287,527.51 13,202.47 98.80
exchange rate
V. Net increase of cash and cash
-145,466,342.45 -151,464,211.03 -32,417,927.28 -58,306,515.66
equivalents
Add: Balance of cash and cash equivalents
475,557,589.39 391,427,532.25 502,339,160.35 431,494,649.19
at the period -begin
VI. Balance of cash and cash equivalents at
330,091,246.94 239,963,321.22 469,921,233.07 373,188,133.53
the period–end
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
29
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
CONSOLIDATED STATEMENT OF CHANGES IN OWNERS’ EQUITY
Prepared by Dalian Refrigeration Company Limited 2015.01-06 Unit: RMB Yuan
2015.01-06
Owners’ equity attributable to parent company
Items Lessen: Other Minority Total of
Surplus General risk Retained equity owners’ equity
share capital Capital suplus treasury comprehensiv Others
reserve reserve profits
stock e income
I. balance at the end of
350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
last year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the
350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
beginning of this year
III. Increase/ decrease of
amount in this year (“-” 10,150,000.00 51,160,208.00 852,972,585.40 22,378,995.91 -11,925,743.84 -8,547,017.98 916,189,027.49
means decrease)
(I) Total comprehensive
852,972,585.40 65,477,775.99 -794,595.06 917,655,766.33
incomes
(II) Capital increased and
10,150,000.00 51,160,208.00 -5,249,900.00 56,060,308.00
reduced by owners
1. Common shares 10,150,000.00 51,160,208.00 -5,249,900.00 56,060,308.00
increased by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of
share-based payments
recognized in owners’
equity
4. Other
(III) Profit distribution 22,378,995.91 -77,403,519.83 -2,502,522.92 -57,527,046.84
1. Withdrawing surplus
22,378,995.91 -22,378,995.91
public reserve
2. Distribution to all -54,024,746.25 -2,502,522.92 -56,527,269.17
owners (shareholders)
3. Others -999,777.67 -999,777.67
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital
reserves
2. Convert surplus
reserves to share capital
3. Surplus reserves
make up losses
4. Others
(V) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(VI) Other
IV. Balance at the end of
360,164,975.00 633,448,214.29 855,740,872.12 568,167,243.90 474,241,996.29 88,084,397.10 2,979,847,698.70
this period
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
30
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2014.01-12
Owners’ equity attributable to parent company
Items Lessen: Other Minority Total of
Surplus General risk Retained equity owners’ equity
share capital Capital suplus treasury comprehensi Others
reserve reserve profits
stock ve income
I. balance at the end of last
350,014,975.00 584,861,283.21 505,533,065.25 466,608,867.000 102,089,597.39 2,009,107,787.85
year
1. Change of accounting -2,783,286.72 2,783,286.72
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
350,014,975.00 582,077,996.49 2,783,286.72 505,533,065.25 466,608,867.00 102,089,597.39 2,009,107,787.85
this year
III. Increase/ decrease of
amount in this year (“-” 210,009.80 -15,000.00 40,255,182.74 19,558,873.13 -5,458,182.31 54,550,883.36
means decrease)
(I) Total comprehensive
-15,000.00 115,439,722.39 -920,440.66 114,504,281.73
incomes
(II) Capital increased and
210,009.80 -2,281,000.00 -2,070,990.20
reduced by owners
1. Common shares increased -2,281,000.00 -2,281,000.00
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other 210,009.80 210,009.80
(III) Profit distribution 40,255,182.74 -95,880,849.26 -2,256,741.65 -57,882,408.17
1. Withdrawing surplus 40,225,182.74 -40,255,182.74
public reserve
2. Distribution to all owners
-52,502,246.25 -2,256,741.65 -54,758,987.90
(shareholders)
3. Others -3,123,420.27 -3,123,420.27
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other
IV. Balance at the end of this
350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
period
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
31
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
STATEMENT OF CHANGES IN OWNERS’ EQUITY
Prepared by Dalian Refrigeration Company Limited 2015.01-06 Unit: RMB Yuan
2015.01-06
Owners’ equity attributable to parent company
Items Lessen: Other Total of owners’
Other equity Special Surplus Retained equity
share capital Capital suplus treasury comprehensiv
instrument preparation reserve profits
stock e income
I. balance at the end of last
350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
year
1. Change of accounting
policy
2. Correction of errors in
previous period
II. Balance at the beginning of
350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
this year
III. Increase/ decrease of
amount in this year (“-” 10,150,000.00 51,160,208.00 852,972,585.40 22,378,995.91 -15,412,910.65 921,248,878.66
means decrease)
(I) Total comprehensive
852,972,585.40 60,990,831.51 913,963,416.91
incomes
(II) Capital increased and
10,150,000.00 51,160,208.00 61,310,208.00
reduced by owners
1. Common shares increased 10,150,000.00 51,160,208.00 61,310,208.00
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other
(III) Profit distribution 22,378,995.91 -76,403,742.16 -54,024,746.25
1. Withdrawing surplus 22,378,995.91 -22,378,995.91
public reserve
2. Distribution to all owners
-54,024,746.25 -54,024,746.25
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other
IV. Balance at the end of this
360,164,975.00 633,448,214.29 854,511,944.50 568,167,243.90 376,315,664.94 2,792,608,042.63
period
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
32
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2014.01-12
Owners’ equity attributable to parent company
Items Lessen: Other Total of owners’
Other equity Special Surplus Retained equity
share capital Capital suplus treasury comprehensiv
instrument preparation reserve profits
stock e income
I. balance at the end of last
350,014,975.00 583,632,355.59 505,533,065.25 372,591,025.04 1,811,771,420.88
year
1. Change of accounting
policy -1,554,359.10 1,554,359.10
2. Correction of errors in
previous period
II. Balance at the beginning of
350,014,975.00 582,077,996.49 1,554,359.10 505,533,065.25 372,591,025.04 1,811,771,420.88
this year
III. Increase/ decrease of
amount in this year (“-” 210,009.80 -15,000.00 40,255,182.74 19,137,550.55 59,587,743.09
means decrease)
(I) Total comprehensive
-15,000.00 111,894,979.54 111,879,979.54
incomes
(II) Capital increased and
210,009.80 210,009.80
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by
holders of other equity
instruments
3. Amounts of share-based
payments recognized in
owners’ equity
4. Other 210,009.80 210,009.80
(III) Profit distribution 40,255,182.74 -92,757,428.99 -52,502,246.25
1. Withdrawing surplus 40,255,182.74 -40,255,182.74
public reserve
2. Distribution to all owners
-52,502,246.25 -52,502,246.25
(shareholders)
3. Others
(IV) Internal carrying
forward of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves
to share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other
IV. Balance at the end of this
350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
period
Legal Representative: Ji Zhijian Chief Financial Official: Rong Yan Person in Charge of Accounting Organization: Mao Chunhua
33
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
III. Notes to the accounting statement
(All amounts in RMB Yuan unless otherwise stated)
1. General information
Dalian Refrigeration Company Limited (the “Company”) was reorganized from main part of former
Dalian Refrigeration Factory, and incorporated in the People’s Republic of China (the “PRC”) on
December 18, 1993 as a joint stock limited company. The Company’s domestically listed RMB
denominated ordinary shares (“A shares”) and domestically listed foreign investment ordinary
shares (“B shares”) were listed on the Shenzhen Stock Exchange in the PRC in December 1993 and
March 1998 respectively. The Company together with its subsidiaries is hereinafter collectively
referred to as the “Group”. As at 30 June, 2015, the registered capital of the Company was RMB
360,164,975.00. The address of the Company’s registered office is No.888 Xinan Road, Shahekou
District, Dalian, China. The parent company of the Company is Dalian Bingshan Group Co., Ltd.
The principal activities of the Company are manufacture, sale and installation of refrigeration
equipments.
The financial statements were permitted to disclose by the board of directors of the Company on
19th August, 2015.
2. The scope of consolidation
There are 8 entities included in the current consolidated financial statements, including:
Proportion of Proportion of
Names of subsidiaries Types Level
shareholding（%） votes（%）
Dalian Bingshan Group Refrigeration Installation Fully owned 1 100 100
Co., Ltd.
Dalian Bingshan Group Sales Co., Ltd. Fully owned 1
100 100
Dalian Bingshan Air-Conditioning Equipment Holding
1
Co., Ltd. subsidiary 70 70
Holding 1
Dalian Bingshan Metal Processing Co., Ltd. 100 100
subsidiary
Holding 1
Dalian Bingshan Guardian Automation Co., Ltd. 60 60
subsidiary
Dalian Bingshan Ryosetsu Quick Freezing Holding 1
70 70
Equipment Co., Ltd. subsidiary
Wuhan New World Refrigeration Industrial Co., Holding 1
51 51
Ltd. subsidiary
Holding 1
Bingshan Technical Service (Dalian ) Co., Ltd. 60 60
subsidiary
The subject included in consolidated financial statement in the reporting period increased the
Bingshan Technology Service (Dalian) Co., Ltd. over that of last period.
By the solution of the 11th meeting of 6th session of Board of Directors of the company, the company
purchased 10% shareholdings of Dalian Bingshan Group Sales Co., Ltd., and Dalian Bingshan
Group Sales Co., Ltd. became a whole holding subsidiary of the company. The company would
transfer 30% shareholdings of Dalian Bingshan Group Sales Co., Ltd. to Wuhan New World
Refrigeration Industrial Co., Ltd., but the equity transaction did not finish at the end of June 30,
2015, and the company held 100% shareholdings of Dalian Bingshan Group Sales Co., Ltd. in the
financial statements of first half of 2015.
By the solution of the 12th meeting of 6th session of Board of Directors of the company, the
company would purchase the subsidiary Dalian Bingshan Metal Processing Co., Ltd., and the equity
transaction had been finished at the end of June 30, 2015., and the company held 100%
shareholdings of Dalian Bingshan Metal Processing Co., Ltd. in the financial statements of first half
of 2015.
By the solution of the 12th meeting of 6th session of Board of Directors of the company, the
company will establish a joint company with Dalian Bingshan International Trade Co., Ltd. The
34
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
new company named Bingshan Technology Service (Dalian) Co., Ltd., and the registered capital is
RMB 20,000,000.00. The company will invest RMB 12,000,000.00 and hold 60% of shareholding
proportion. Till end of 30 June 2015, Bingshan Technology Service (Dalian) Co., Ltd. started
operations, and was included in the consolidated statement.
IV Basic of preparation of financial statements
1. Basic of preparation of financial statements
The financial statements have been prepared on the basic assumption of going concern and on the
accrual basis of accounting. The effects of evens and other transactions actually occurred and they
have been recorded and measured in accordance with the Accounting Standards for Business
Enterprises issued by Ministry of Finance.
2. Going-concern
The company has the capacity to continually operate within 12 months at least since the end of
report period, and hasn‘t the major issues impacting on the sustainable operation ability.
V.The main accounting policies, accounting estimates and corrections of accounting errors
1. Declaration on following Accounting Standard for Business Enterprises
Declaration from the Company: The financial statements made by the Company was in accordance
with Accounting Standards for Business Enterprises, which reflected the financial position, financial
performance and cash flow of the Company truly, objectively and completely.
2. Fiscal year
The Company adopts the calendar year as its fiscal year, i.e. from January 1 to December 31.
3. Operating Cycle
12 months are regarded as one operating cycle in the company, and which is as the division criterion
for the liquidity of assets and liabilities.
4. Functional currency
RMB was the functional currency of the Company.
5. Accounting method of business combination under the same control and not under the same
control
A. The Company adopts equity method for business combination under same control. The assets
and liabilities that the combining party obtained in a business combination shall be measured on
their carrying amount in the combined party on the combining date. The difference between the
carrying amount of net assets acquired by the combining party and the carrying amount of the
consideration paid by it (or the total par value of the shares issued) shall be adjusted to capital
surplus. If the capital surplus is not sufficient for adjustment, retained earning is adjusted
respectively. The business combination costs that are directly attributable to the combination, such
as audit fees, valuation fees, and legal service fees and so on are recognized in profit or loss during
the current period when they occurred. The bonds issued for a business combination or the handling
fees, commissions and other expenses for bearing other liabilities shall be recorded in the amount of
initial measurement of the bonds or other debts. The handling fees, commissions and other expenses
for the issuance of equity securities for the business combination shall be credited against the
surplus of equity securities; if the surplus is not sufficient, the retained earnings shall be offset.
Where a relationship between a parent company and a subsidiary company is formed due to a
business combination, the parent company shall, on the combining date, prepare consolidated
financial statements according to the accounting policy of the Company.
B. The Company adopts acquisition method for business combination not under same control. The
acquirer shall recognize the initial cost of combination under the following principles: a) When
business combination is achieved through a single exchange transaction, the cost of a business
combination is the aggregate of the fair values, at the date of exchange, of assets given, liabilities
35
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
incurred or assumed, and equity securities issued by the acquirer, in exchange for control of the
acquiree; b) For the business combination involved more than one exchange transaction, the cost of
the combination is the aggregate cost of the individual transactions; c) The costs directly attributed
to business combination are included in the cost of combination; d) Where a business combination
contract or agreement provides for a future event which may adjust the cost of combination, the
Company shall include the amount of the adjustment in the cost of the combination at the
acquisition date if the future event leading to the adjustment is probable and the amount of the
adjustment can be measured reliably.
The acquirer shall, on the acquisition date, measure the assets given and liabilities incurred or
assumed by an enterprise for a business combination in light of their fair value, and shall record the
balances between them and their carrying amounts into the profits and losses at the current period.
The acquirer shall distribute the combination costs on the acquisition date, and shall recognize all
identifiable assets, liabilities and contingent liabilities it obtains from the acquiree. a. the acquirer
shall recognize the difference that the combination costs are over the fair value of the identifiable
net assets obtained from acquiree as goodwill; b. if the combination costs are less than the fair value
of the identifiable net assets obtained from acquiree, the acquirer shall reexamine the measurement
of the fair values of the identifiable assets, liabilities and contingent liabilities obtained from the
acquiree as well as the combination costs; and then after the reexamination, the result is still the
same, the difference shall be recorded in the profit and loss of the current period.
Where a relationship between a parent company and a subsidiary company is formed due to a
business combination, the parent company shall prepare accounting books for future reference,
which shall record the fair value of the identifiable assets, liabilities and contingent liabilities
obtained from the subsidiary company on the acquisition date. When preparing consolidated
financial statements, it shall adjust the financial statements of the subsidiary company on the basis
of the fair values of the identifiable assets, liabilities and contingent liabilities determined on the
acquisition date according to the Company’s accounting policy of “Consolidated financial
statement”.
6. Basis of consolidation
(1) Scope of consolidation
Consolidated financial statements are included all subsidiaries of the parent.
(2) Increase or decrease of the subsidiaries
For any subsidiary acquired by the Company through business combination under the same control,
when the consolidated balance sheet for the current period is being prepared, the beginning balances
in the consolidated balance sheet are made corresponding modification. For addition business
combination not under same control during the reporting period, the Company makes no adjustment
for the beginning balances in the consolidated balance sheet. When disposing subsidiary during the
reporting period, the Company makes no adjustment for the beginning balances in the consolidated
balance sheet. For any subsidiary acquired by the Company through business combination under the
same control, when the consolidated income statement for the current period is being prepared, sales,
expense and profit for the period from the beginning of the consolidated period to the year end of
the reporting period are included in the consolidated income statement. For addition business
combination not under same control during the reporting period, revenue, expense and profit for the
period from acquisition date to the year end of the reporting period is included in the consolidated
income statement. When disposing subsidiary during the reporting period, sales, expense and profit
for the period from the beginning to the disposal date are included in the consolidated income
statement.
For any subsidiary acquired by the Company through business combination under the same control,
when the consolidated cash flow statement for the current period is being prepared, cash flow for
the period from the beginning of the consolidated period to the year end of the reporting period is
included in the consolidated cash flow statement. For addition business combination not under same
control during the reporting period, cash flow for the period from acquisition date to the year end of
the reporting period is included in the consolidated cash flow statement. When disposing subsidiary
during the reporting period, cash flow for the period from the beginning to the disposal date is
included in the consolidated cash flow statement.
(3)Principle of consolidation
The consolidated financial statements are based on the financial statements of individual
subsidiaries which are included in the consolidation scope and prepared after adjustment of
36
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
long-term equity investment under equity method and elimination effect of intra-group transaction.
(4) Minority interests
The portion of the equity of the subsidiaries that are not owned by the parent is presented as
minority interest in the consolidated balance sheet. The portion of the profit or loss of the
subsidiaries that are not owned by the parent is presented as minority interest in the consolidated
income statement.
(5) Excess losses
The amount which losses of subsidiaries during the period exceeds the proportion of minority’s
obligation is offset minority interest as agreed in the subsidiaries’ association or agreement and
minorities have ability to bear the excess losses. Otherwise, the excess losses are offset equity of the
parent company. Profits made afterward by subsidiaries are attributable to equity of the parent
company before recovery of excess losses.
7. Joint venture arrangements classification and co-operation accounting treatment
A.Joint venture arrangements classification
Under the terms of the structure of the company, the legal form of the joint venture arrangements
agreed in the joint venture arrangements, other factors such as the relevant facts and circumstances,
the joint venture arrangements include co-operation and joint ventures.
The joint venture arrangement unreached by individual entity is divided into common business;
joint venture arrangement reached by individual entity usually classified as a joint venture; but there
is conclusive evidence that any of the following conditions are satisfied and the division of joint
venture arrangements in line with the relevant laws and regulations for the common business:
(1)The legal form of a joint venture arrangement shows that the joint venture party have rights and
bear obligations in respect of the relevant assets and liabilities.
(2)Contractual terms of the JV agreement arrangements agrees that the joint venture party have
rights and bear obligations in respect of the relevant assets and liabilities.
(3)Other relevant facts and circumstances indicate that the joint venture party have rights and bear
obligations in respect of the relevant assets and liabilities.
If joint venture parties enjoy almost all outputs associated with the joint venture arrangements, and
the settle of the liability arrangement continued reliance on joint venture the joint venture party
support.
B. Accounting treatment of the joint operation
The Company confirms that the following items share a common interest in the business associated
with the Company, and audit in accordance with the provisions of the relevant enterprise accounting
standards:
(1)Confirm individual assets and common assets held based on shareholdings;
(2)Confirm individual liabilities and shared liabilities held based on shareholdings;
(3)Confirm the income from the sales revenue of co-operate business output
(4)Confirm the income from the sales of the co-operate business output based on shareholdings;
(5)Confirm the individual expenditure and co-operate business cost based on shareholdings.
The company co-operates to invest or sell assets (excluding the assets constituting the business),
before sold to third party, only confirm the part of transaction gains and losses that attributable to
other participants. Assets sold in accordance with "Enterprise Accounting Standards No. 8
Impairment of Assets" and other provisions, the Company confirmed all the loss.
The company co-operates to purchase assets (excluding the assets constituting the business), before
sold to third party, only confirm the part of transaction gains and losses that attributable to other
participants. Assets acquired in accordance with "Enterprise Accounting Standards No. 8
Impairment of Assets" and other provisions, the Company confirmed that part of loss based on
shareholdings.
The Company is not entitled to jointly controlled, if the Company co-operate the relevant assets and
bear related liabilities, need accounting treatment based upon the above principles.
Otherwise, should be accounted in accordance with the relevant provisions of accounting standards.
8. The standard for recognizing cash equivalent when making cash flow statement
Cash equivalent means the highly liquid, very safe investment which can be easily converted into
cash, and the company can hold it for a very short time (3 months from the date of purchase).
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
9. Method of foreign currency translation
When foreign currency translation occurs, the spot exchange rate on the date of translation (i.e., the
middle price of the intraday foreign exchange rate of RMB published by People’s Bank of China)
shall be converted into RMB for keeping accounts while the occurred foreign currency exchange or
the foreign exchange transactions shall be translated according to exchange rate adopted in actual
transactions. On the balance sheet date, the foreign currency monetary items and foreign currency
non-monetary items shall be treated in accordance with the following provisions:
The foreign currency monetary items shall be translated at the spot exchange rate on balance sheet
date, of which happen during the normal business period shall be recorded into gains and losses at
the current period; of which happen during organization period shall be recorded into long-term
deferred expense. The exchange gains or losses caused by the borrowing belonging to acquiring
fixed assets shall be treated by the capitalization of borrowing costs.
Foreign currency non-monetary items shall be translated at spot rate on the date of transaction, not
changing the amount of functional currency.
The Company translates the financial statements of its foreign operation in accordance with the
following provisions: a) the asset and liability items in the balance sheets shall be translated at a
spot exchange rate ruling at the balance sheet date. Among the owner's equity items, except the ones
as "retained earnings", others shall be translated at the spot exchange rate ruling at the time when
they occurred;. b) The income and expense items in the income statements shall be translated with
approximate exchange rate of the sight rate on the transaction occurring date. The foreign exchange
difference arisen from the translation of foreign currency financial statements shall be presented
separately under the owner's equity in the balance sheet.
10. The recognition and measurement of financial instruments and the transfer of the
financial instruments
(1) Recognition of the financial assets
When an enterprise becomes a party to a financial instrument, it shall recognize a financial asset or
financial liability. Where a financial asset satisfies any of the following requirements, the
recognition of it shall be terminated:
①Where the contractual rights for collecting the cash flow of the said financial assets are
terminated;
②Where the said financial asset has been transferred and meets the conditions for recognizing the
termination of financial assets as provided for in Accounting Standard for Business Enterprises No.
23 – Transfer of Financial Assets. Only when the prevailing obligations of a financial liability are
relieved in all or in part may the recognition of the financial liability be terminated in all or partly.
(2) The classification, recognition and measurement of financial assets and financial liabilities
The financial assets or financial liabilities got or born by the Company are measured according to
the following classifications:
①The financial assets or financial liabilities which are measured at their fair value and the variation
of which is recorded into the profits and losses of the current period
The interest rate or cash dividend which was gained in the period when the financial assets held by
the Company are measured at its fair value and of which the variation is recorded into the profits
and losses in the current period shall be recognized as investment income. On balance sheet date,
the in change in the fair value of the financial asset or financial liability which is measured at its fair
value and of which the variation is recorded into the profits and losses of the current period, shall be
recorded into the profits and losses of the current period; When the said financial assets of financial
liabilities are on disposal, the difference between the fair value and the amount in initial account
shall be recognized as investment income, meanwhile, the profits and losses arising from the change
in fair value shall be adjusted.
②The investments which will be held to their maturity
The investments which will be held to their maturity will regard the sum between the gained fair
value and the transaction expense thereof as the initially recognized amount. The interest on bonds
in payment, of which the mature interest is not drawn, shall be solely recognized as the receivables.
The interest revenue which is measured and recognized by the amortized cost and actual interest
rate during the period of the investments which will be held to their maturity shall be recorded into
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
investment income. The actual interest rate which is recognized in the period of gaining the
investments which will be held to their maturity, shall maintain unchanged within the predicted term
of existence or within a shorter applicable term of the said investment which will be held to their
maturity. The little difference between actual interest rate and coupon rate of which interest revenue
can be measured at the coupon rate shall be recorded into the profits of losses in the current period.
When the investments which will be held to their maturity are on disposal, the difference between
the obtained price and investment book value shall be recorded into the profits and losses in the
current period.
③The accounts receivables
The creditor’s right receivable formed during the Company selling commodity outside or offering
labor shall be regarded as the initially recognize amount in according with the receivable price
stipulated in the contract or agreement signed between the Company and the buyers. When the
Company recovers or disposes the accounts receivable, the difference between the obtained price
and the book value of the accounts receivable shall be recorded into the profits and losses in the
current period.
④Financial assets available for sale
The financial assets available for sale will be regarded as the initial recognized amount in according
with the sum between the fair value obtained from the said financial assets and the transaction
expense thereof. The interest on bonds of which the mature interest rate is not drawn in the payment
or the cash dividend which is declared but not extended in the payment shall be solely recognized as
the receivables.
The interest rate or cash dividend gained during the period of holding the financial assets available
for sale shall be recorded into investment income. On balance sheet date, the financial assets shall
be measured through fair value, while the change in fair value is recorded into capital reserves
(other capital reserves).
When the financial assets are on disposal, the difference between the obtained price and the book
value of the financial assets shall be recorded into investment income, meanwhile, the amount on
proposal transferring out from the accumulated amount which is directly recorded into shareholders’
equity and arises from the variation of the fair value, shall be recorded into investment income.
⑤Other financial liabilities
Other financial liabilities are regarded as the initial recognized amount in accordance with the sum
between the fair value and the transaction expense thereof. The Company shall make subsequent
measurement on other financial liabilities on the basis of the post-amortization costs.
(3) Main recognition method for the fair value of the financial assets or financial liabilities
① the quotation in the active market shall be used to recognize the fair value of the financial assets
or financial liabilities existing in active market.
② If the financial instruments do not exist in the active market, the fair value shall be recognized by
value appraisal techniques.
③ as for the financial assets initially obtained of produced at source and the financial liabilities
assumed, the fair value thereof shall be determined on the basis of the transaction price of the
market.
(4) Main impairment test method of the financial assets and impairment provision method
The recognition standard for impairment provision of the financial assets: the Company shall carry
out an inspection, on the balance sheet day, on the carrying amount of the financial assets other than
those measured at their fair values and of which the variation is recorded into the profits and losses
of the current period. Where there is any objective evidence proving that such financial asset has
been impaired, an impairment provision shall be made.
The withdrawal method for impairment provision of the financial assets: as for the impairment
provision of the financial assets is measured on the basis of post-amortization costs, if the current
value of the predicted future cash flow of the financial assets is below the difference in the carrying
amount of the said financial asset, the impairment provision of the financial assets shall be made; as
for the impairment provision of the financial assets available for sale, if the recoverable amount is
below the difference in the carrying amount, the impairment provision shall be made. Where a
sellable financial asset is impaired, even if the recognition of the financial asset has not been
terminated, the accumulative losses arising from the decrease of the fair value of the owners’ equity
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
which was directly included shall be transferred out and recorded into the profits and losses of the
current period.
11. Receivable accounts
(1) Recognition and providing of bad debt provision on individual receivable account with large
amount
Basis of recognition or standard
amount of individual account Top 5 of account receivables at year end
with large amount
Impairment test performed individually, bad debt provision will be
provided at the difference of expected cash flow lower than the book
Basis of bad debt provision
value. Without bad debt provision needed provided through individually
test, bad debt provision will be provided at age analysis method.
(2) Recognition and providing basis of bad debt reserves for group of receivable accounts with
similar characteristics of credit risks
①Basis of recognition and providing of bad debt provision
Basis of recognition for groups
Group of inner units Accounts receivable due from subsidiaries included in consolidated scope
Group by age analysis With similar characteristics of credit risks
Basis of bad debt provision
Group of inner units Individual identified method
Group by age analysis Age analysis method
②Age analysis
Provision rates for Provision rates for
Ages
account receivables other receivables
Within 1 year, (included, same for the followings) 5% 5%
1-2 years 10% 10%
2-3 years 30% 30%
3-4 years 50% 50%
4-5 years 80% 80%
Over 5 years 100% 100%
(3)Other minor amount
For the receivables which are not individually significant, and which individually significant but are
not provided provision individually, in accordance with credit risk characteristics, the method of
provision for bad debts is aging analysis method. The assessment is made collectively where
receivables share similar credit risk characteristics (including those having not been individually
assessed as impaired), based on their historical loss experiences, and adjusted by the observable
figures reflecting present economic conditions.
12. The classification, pricing and accounting methods for inventories; the recognition
standard and withdrawal method of the inventories falling price reserves
(1) Classification of the inventories: purchased materials, stocking materials, material cost
difference, entrusted processing materials, unfinished products, finished products, working on
project and etc.
(2) The inventory system is on the basis of perpetual inventory method.
(3) The inventories are priced by the historical cost method, so are the raw material and auxiliary
material, the sold material cost is carried over on the basis of first-in first-out method; the product
cost is accounted through standard cost method, the difference between the standard cost and
historical cost is undertaken by the cost of the finished goods in process, while the cost of sales is
carried over on the basis of weighted average method; low-value consumption goods will be
amortized once when drawn.
(4) As for the inventory write-down provided: each kind of inventories at the end of the report
period will be measured at the lower of cost or net realizable value, and a provision for inventory
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
write-down will be established for any difference between the cost and the lower net realizable
value. The net realizable value refers to the value minus the predicted expense needed in the process
of completing the production and sales from the predicted price for sale and the taxes.
13. Classified as the assets held for sale
A. Recognition criteria for the classification of the assets held for sale
The company will recognize the combination parts of the enterprise (or non-current assets) which
simultaneously meet the following requirements, as the components of the assets held for sale.
(1) The components should be immediately sold under the current condition only according to the
usual terms of the parts sold.
(2) The enterprise has made resolution for the disposal of the components, the approval of
shareholders’ meeting or relevant authority agency if the shareholder’s approval is requested by the
rules.
(3) The enterprise has signed the irrevocable transfer agreement with the transferee.
(4) The transfer shall be completed within one year.
B. Accounting method for the classification of the assets held for sale
For the fixed assets held for sale, the company shall adjust the estimated net residual value of the
fixed assets in order to make it reflecting the amount after the disposal costs deducted from the fair
value, which doesn’t exceed the original book value of the fixed assets when the condition of
holding for sale is met. The impairment losses of the assets shall be regarded and recorded into the
current profits and losses if the original book value is more than the balance of the estimated net
residual value after adjusting. The fixed assets held for sale which not withdraw the depreciation or
amortization shall be measured according to the lesser one between the balances of the book value
or the fair value minus the disposal costs respectively.
The equity investment, intangible assets and other non-current assets held for sale shall be handled
as per above mentioned principles, but excluding the deferred income tax assets, the financial assets
regulated in ―Accounting Standards for Enterprises No.22 – Recognition and Measurement of
Financial Instruments, the investment property and the biological assets measured by the fair value,
and the contractual right issued in the insurance contract.
14. Long-term equity investment
A. Investment cost confirmation
(1) For the long term equity investment from enterprise merger, the detailed accounting policy,
please refer to the accounting method of merger of enterprises under or not under the same
controller in Note IV / (V). While, the long term equity investment acquired through liability
reorganization is booked on the basis of fair value.
(2) The long-term equity investments acquired by other ways
For the long-term equity investment acquired by the cash payment method, the purchase price of
actual payment as the initial investment cost, which includes costs, taxes and other necessary
expenses directly relevant to the long-term equity investment acquired.
For the long-term equity investment acquired by the issuance of the equity securities, the fair value
of the issuance of the equity securities as the initial investment cost. The transaction costs occurred
in the issuance or acquirement of own equity instruments can be deducted from the equity for those
that can be directly included in the equity transactions.
The non-monetary asset exchange for a commercial real income and assets or the fair value other
assets can be reliably measured, the initial investment cost should be determined according to
long-term equity investment exchanged through the non-monetary asset exchange, unless there is
evidence showing that for the fair value of assets is more reliable; the non-monetary asset exchange
which does not meet the above premises, the book value of the exchanged assets to and the relevant
fees and taxes to be paid should be the initial investment cost of the long-term equity investment.
The initial investment cost of the long-term equity investments obtained through debt restructuring
should be determined in accordance with fair value.
B. Follow-up measurements & recognitions of profits or losses
(1) Cost method
The company can adopt the cost method to account the long-term equity investment controlled by
the invested party and follow the initial investment cost to calculate the price and add or take back
the investment and adjust the costs of long-term equity investment.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Except for the price of actual payment in acquiring investment or the cash dividends or profits
declared but not issued yet included in the consideration, the company shall recognize the cash
dividends or profits delivered by the invested party as the current investment returns.
(2) The equity method
The company shall adopt the equity method to account the long-term equity investment of the joint
ventures and the cooperative enterprises, and use the measurement of the fair value and record the
changes into the profits and losses for the parts of the equity investment of the joint ventures
indirectly held by risk investment agency, mutual fund, trust company or other similar bodies
including the investment-link-insurance funds.
For the initial investment cost of the long-term equity investment is more than the balance of the
shares of the fair value of the identifiable net assets from the invested party in investment, the initial
investment cost of the long-term equity investment shouldn’t be adjusted. If less, recorded into the
current profits and losses.
The investment returns and other comprehensive incomes will be respectively recognized as per the
shares of the net profits and losses and other comprehensive returns realized by those shared and
undertaken invested parties after the company acquires the long-term equity investment, and the
book value of long-term equity investment shall be adjusted simultaneously. Also, the shared parts
shall be calculated according to the profits and cash dividends delivered by the invested party, and
the book value of long-term equity investment shall be reduced correspondingly. For other changes
in owner’s equity of the invested parity except for net profits and losses, other comprehensive
returns and profits distribution, the book value of long-term equity investment shall be adjusted and
the owner’s equity should be recorded into.
The shared portions of the net profits and losses of the invested party shall be recognized by the
company after the net profits of the invested party are adjusted based on the fair value of the
identifiable assets from the invested party when acquiring the investment. Also, the profits and
losses of investment are recognized on the basis of the offset of the shared proportion for the
internal transaction profits and losses issued but not realized yet between the company and the joint
venture and the cooperation enterprises.
The following steps should be taken when the company confirms to share the losses of the invested
party: First, offset the book value of the long-term equity investment. Then, offset the book value of
the long-term receivables after recognize the investment losses based on the book value of
long-term equity of the net investment from the invested party if the book value of the long-term
equity investment is insufficient to offset. Last, recognize the estimated loads as per the estimated
liability undertaken and record into the current investment losses if additional liability is still needed
to undertake based on the provisions of investment contract or agreement after above-mentioned
steps.
For the profits realized by the invested party during the future period, the company shall handle
based on the opposite steps after deducting the unconfirmed losses undertaken, and resume the
recognized investment returns after reduce the confirmed book balance of estimated liabilities and
resume other book values of long-term rights and investments of the net investment from the
invested party.
C. Transformation of accounting method for the long-term equity investment
(1) The fair value measurement transformed to the equity method
For the equity investments originally held by the company and having non-control, joint control or
major impact on the invested party through the accounting treatment as per the confirmation of
financial instrument and the measurement criterion, which can have significant impact or haven’t
control on the invested party due to the additional investment, the sum of the fair value of the equity
investment originally held and the new investment costs based on the recognition of ―Accounting
Standards for Enterprises No.22 – Recognition and Measurement of Financial Instruments‖ shall
be regarded as the initial investment costs accounted by the equity method.
If the equity investment held originally can be classified as the financial assets for sale, the
difference between the fair value and the book value, and the variation in the accumulative fair
value of other comprehensive returns recorded originally will be transferred into the current profits
and losses accounted by the equity method.
If the initial investment costs accounted by the equity method is less than the difference between the
portions of the fair value of the identifiable net assets shared from the invested party on the
additional investment date calculated and recognized as per the new shareholding proportion after
the additional investment, the book value of long-term equity investment should be adjusted and
which shall be recorded into the current nonbusiness incomes.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(2) The fair value measurement or the equity method transformed to the cost method
For the equity investments originally held by the company and having non-control, joint control or
major impact on the invested party through the accounting treatment as per the confirmation of
financial instrument and the measurement criterion, or the long-term equity investments in the joint
ventures and the cooperative enterprises held originally, which can have control on the invested
party under non-common control due to the additional investment, the sum of the book value of the
equity investment originally held and the new investment costs in preparation of individual financial
statement shall be regarded as the initial investment costs accounted by the cost method.
Other comprehensive returns accounted and recognized for the equity investment held prior to the
purchase date by adopting the equity method, should be conducted the accounting treatment
according to the same basis of relevant assets or liabilities directly disposed by the invested party.
If the equity investment held before the purchase date is conducted the accounting treatment
according to the relevant provisions of ―Accounting Standards for Enterprises No.22 –
Recognition and Measurement of Financial Instruments‖, the variation in the accumulative fair
value of other comprehensive returns recorded originally shall be transferred to the current profits
and losses accounted by the cost method.
(3) The equity method transformed to the fair value measurement
If the company loses the joint control or major impact on the invested party due to disposal of part
of equity investments, the remaining equity after disposed should be accounted according
to ―Accounting Standards for Business Enterprises No.22 – Recognition and Measurement of
Financial Instruments‖, and the balance between the fair value and the book value shall be
recorded into the current profits and losses on the date of joint control or major impact lost.
Other comprehensive returns accounted and recognized for the original equity investment by
adopting the equity method, should be conducted the accounting treatment according to the same
basis of relevant assets or liabilities directly disposed by the invested party when stop to account by
the equity method.
(4) The cost method transforming to the equity method
If the company loses the control of the invested party due to disposal of part of equity investments,
and the remaining equity after disposed can have joint control or major impact on the invested party
in preparation of individual financial statement, the equity method shall be adopted to conduct
accounting and the remaining equity shall be regarded to use the equity method to account and
adjust when acquiring.
(5) The cost method transforming to the fair value measurement
If the company loses the control of the invested party due to disposal of part of equity investments,
and the remaining equity after disposed can’t have joint control or major impact on the invested
party in preparation of individual financial statement, the relevant provisions of ―Accounting
Standards for Enterprises No.22 – Recognition and Measurement of Financial Instruments‖
should be followed to conduct the accounting treatment, and the balance between the fair value and
the book value shall be recorded into the current profits and losses on the date of control lost.
D. Disposal of the long-term equity investment
The difference between the book value and the price acquired actually in disposal of the long-term
equity investment should be recorded into the current profits and losses. The long-term equity
investment accounted by the equity method shall be conducted the accounting treatment of part of
other original comprehensive returns as per the corresponding proportion on the same basis of the
relevant assets or liabilities directly disposed by the invested party when the disposal of the
investment.
If the following one or multiply requirements are met for all transaction terms, conditions and
economic impact in disposal of the equity investment of subsidiary, the multiply transactions will be
regarded as the package deal to conduct the accounting treatment:
(1) These transactions are signed simultaneously or after the consideration of the influence each
other.
(2) These transactions should be as a whole to achieve a complete business result.
(3) One transaction occurs depending on the issuance of at least other one transaction.
(4) It is uneconomic for one transaction, but economic with other transactions.
For the control on the original subsidiary lost due to disposal of part of the equity investment or
other reasons and the non-package deal, the relevant accounting treatment should be respectively
conducted for the individual financial statement and the consolidated financial statements:
(1) In the individual financial statement, the difference between the book value and the price
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
acquired actually in disposal of the equity shall be recorded into the current profits and losses. If the
remaining equity after disposed can have joint control or major impact on the invested party, the
equity method shall be adopted to conduct accounting and the remaining equity shall be regarded to
use the equity method to account and adjust when acquiring. If the remaining equity after disposed
can’t have joint control or major impact on the invested party, the relevant provisions
of ―Accounting Standards for Enterprises No.22 – Recognition and Measurement of Financial
Instruments‖ should be followed to conduct the accounting treatment, and the balance between the
fair value and the book value shall be recorded into the current profits and losses on the date of
control lost.
(2) In the consolidated financial statements, for all the transactions before the control on subsidiary
lost, and the balance between the disposal price and the long-term equity investment respectively
minus the net assets from the purchase date or the combination date of subsidiary, the capital
reserves (stock premium) shall be adjusted, or the retained earnings shall be adjusted when the
capital reserves are insufficient. When the control on the subsidiary lost, the remaining equity
should be measured again according to the fair value on the control lost date. The difference of the
consideration acquired by the disposal of equity and the fair value of the surplus equity minus the
net assets portion of the original subsidiary calculated from the purchase date a per the original
stock proportion shall be recorded into the current investment income after the control lost and
offset the business reputation. Other comprehensive returns relevant to the original subsidiary shares
investment shall be transferred into the current investment returns when the control lost.
For the package deal for all the transactions in disposal of the equity investment till the control lost,
all the transactions will be conducted the accounting treatment as a deal to dispose and the relevant
accounting treatment should be respectively conducted for the individual financial statement and the
consolidated financial statements:
(1) In the individual financial statement, all the differences between the book value of the long-term
equity investment of the prices disposed and the equity disposed before the control lost shall be
recognized as other comprehensive incomes and recorded into the current profits and losses in the
control lost.
(2) In consolidated financial statement, all the differences between the net assets portions of
subsidiary of the prices disposed and the investment disposed before the control lost shall be
recognized as other comprehensive incomes and recorded into the current profits and losses in the
control lost.
E. Criteria of the judgment of joint control and significant impact
If the company controls an arrangement together with other parties according to the relevant
agreement, the activity decision-making with significant impact for the arrangement should be
achieved after the unanimous agreement gained from the control parties, which is regarded as the
joint control of one arrangement with other parties and the arrangement is belong to the cooperative
arrangement.
The cooperative arrangement achieved by the independent body which should be as the cooperative
enterprises and the equity method shall be adopted to account according to the relevant agreement to
judge when the company has rights to the net assets of the independent body. If hasn’t rights, the
independent body shall be as the joint operation, the company shall recognize the items related to
the benefit portions of joint operation and the accounting treatment should be conducted according
to the relevant provisions of accounting standards for enterprises.
The significant impact refers to the investor has rights to participate in decision-making for the
finance and operation policy of the invested party, but can’t control or jointly control the setup of
these policies with other parties. The company has made judgment of significant impact on the
invested party through the following one or multiply conditions and under comprehensive
consideration of all facts and status.
(1) There are representatives in the board of Directors or equivalent authorities of the invested party.
(2) Participate in the setup process of finance and operation policies of the invested party.
(3) There is major transactions occurred among the invested parties.
(4) Dispatch the management to the invested party.
(5) Offer the key technical data to the invested party.
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15. Investment real estates
The term Investment real estates refers to the real estates held for generating rentand/orcapital
appreciation, including the right to use any land which has already been rented, the right to use any
land which is held and prepared for transfer after appreciation & the right to use any building which
has already been rented.
The investment real estates are accounted by the cost, the purchased investment real estates include
the cost of the purchase price, related taxes and fees and other expenses which can be directly
attributable to the assets; the costs of investment real estate self constructed include the necessary
expenses to construct the asset to reach the predicted use state.
The Group adopts the cost method to conduct follow-up measurement on investment real estates are
accounted devaluations and amortized. The expected service life, net residual rate and value
depreciation rates of investment real estate are the same with fixed assets or intangible assets.
If the investment real estate is changed to self use, since the date of change, investment real estate
shall be converted into fixed assets or intangible assets. The function of self-use real estate is to earn
rent or capital appreciation, then since the date of change, the fixed assets or intangible assets shall
be converted into investment real estate. When the conversion happens, the book value before the
conversion will be the book value after the conversion.
When the investment real estate is disposed of, or permanently terminates its use and no economic
benefits are expected from its disposal, terminate the confirmation of the investment real estate.
Disposal income of investment property for sale, transfer, disposal of scrap or being destroyed is
charged to current profit or loss after deducting its book value and related taxes.
16. Fixed assets
(1) Confirmation conditions
Fixed assets refer to physical assets owned for purpose of production, service providing, leasing or
management, and operation with service life of more than one year. Fixed assets are recognized
when all of the following conditions are satisfied：a. Financial benefits attached to the fixed asset is
possibly inflowing to the Company; b. The cost of the fixed asset can be reliable measured.
(2)The initially measurement of fixed assets
The fixed assets of the company shall be initially measured by costs. Of which, the fixed assets
costs purchased include purchase price, import duties, other relevant taxes and other expenses that
make the fixed assets can be used. The costs of self-constructed fixed assets are the expenses arisen
from the construction of the assets reaching the expected use status. The fixed assets invested by the
investors shall be recorded into the accounting value according to the value agreed in the investment
contract or agreement, but the unfair value agreed in the contract or agreement shall be bookkept as
per the fair value. If the price for purchase of the fixed assets is beyond the usual credit term and
delay in payment, and there actually is financial, the cost of fixed assets shall be recognized based
on the present value of purchase price. The difference between the price paid actually and the
present value of purchase price shall be recorded into the current profits and losses within the credit
period except for the capitalization granted.
(3) The subsequent expenditure and disposal of fixed assets
a. Deprecation method of fixed assets
The fixed assets depreciation should be withdrawn within the expected service life according to the
recorded value minus the estimated net residual value. For the fixed assets after the impairment
provision withdrawn, the amount of depreciation shall be recognized according to the book value
after the impairment provision deducted and the usable service life in the future.
The company determines the service life and the estimated net residual value of the fixed assets
according to the nature and use of the fixed assets, reviews the service life, the estimated net
residual value and depreciation method of the fixed assets at the end of the year, and makes the
corresponding adjustment if it is different to the original estimated value.
Depreciation is calculated using the straight-line method to allocate their cost to their residual
values over their estimated useful lives, as follows:
Expected residual value
Fixed assets Estimated lifetime Annual depreciation rates
rates
Buildings 20-40 years 2.25-4.85% 3%、 5%、10%
Machinery and equipment 10-22 years 4.09-9.7% 3%、 5%、10%
Motor vehicles 4-15 year 6-24.25% 3%、 5%、10%
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Electric equipments 5 years 18-19.4% 3%、 5%、10%
Other equipments 10-15 years 6-9.7% 3%、 5%、10%
b. The subsequent expenditure of the fixed assets
The subsequent expenditure relevant to the fixed assets shall be recorded into the costs of the fixed
assets if the recognition requirements of the fixed assets are met. If not met, recorded into the
current profits and losses when occurring.
c. The disposal of the fixed assets
The fixed assets shall be derecognized when the assets are disposed and can be used or there is no
economic benefit from the disposal. The amount of the book value and the relevant taxes deducted
from the disposal incomes of the fixed assets sold, transferred, scraped or damaged.
(4) Cognizance evidence and pricing method of financial leasing fixed assets
The fixed assets acquired by the company in line with the following one or several criteria shall be
recognized as the fixed assets acquired under finance leases: (1) at the expiration of the lease, the
ownership of the leased assets shall be transferred to the company. (2) the company has the option
to purchase the leased assets, the purchase price is expected be far lower than the fair value of the
leased assets under the implementation of option right, so that it can be reasonably determined that
the company shall exercise the option on the acquisition date. (3) the lease term is the majority for
the leased assets even if the ownership no transferred. (4) the present value of the minimum lease
payments of the company almost is equal to the fair value of the leased assets on the acquisition
date. (5) For the special nature of the leased assets, only the company can use if no major
modification made.
For the fixed assets acquired under finance leases, the company takes less of the fair value of the
leased asset on the acquisition date and the present value of the minimum lease payments as
recorded value. Also, the minimum lease payments are accounted as the recorded value for the
long-term payables, and the difference are as the unconfirmed financing fees. The initial direct
expenses, such as commission charge, attorney fees, travel expenses and stamp duty attributable to
the lease item occurred in the process of the lease negotiation and the signature of lease contract,
shall be recorded into the leased assets value. The unrecognized financing charges in each period
during the lease term are amortized by effective interest method.
The company adopts the depreciation policy in line with its own fixed assets to count and draw the
depreciation of fixed assets acquired under finance leases. If the ownership of lease assets acquired
at the expiration of lease can be reasonably confirmed, the depreciation will be recognized in the use
life of lease assets. If can’t be confirmed, the shorter period between the lease term and the use life
of lease assets will be recognized as the depreciation.
17. Construction-in-progress
(1) Categories of projects under construction
The company shall measure the self-constructed constructions in progress at the actual cost, which
comprises those expenditures necessarily incurred for bringing the asset to working condition for its
intended use, including materials costs, labor costs, relevant taxes paid, capitalized loans, indirect
expense for apportion, etc.. The constructions in progress of the company should be accounted by
the project classification.
(2)Standard and timing for transferring of projects under construction to fixed assets
All the expenditures that bring the construction in process to the expected condition for use shall be
the credit value of the fixed asset. If the fixed asset construction in process has already reached the
expected condition for use, but hasn’t been made the final account; it shall be carried forward to a
fixed asset according to its estimated value based on the budget, cost or actual cost of the
construction starting from the date when it reaches the expected condition for use, and the fixed
asset shall be depreciated according to the company’s depreciation policy for fixed assets. After the
final account has been made, the original provisional estimated value shall be adjusted according to
the actual cost, but the depreciation which has originally been counted & drawn shall not be
adjusted.
18. Loan expenses
(1)Recognition principles for capitalizing of loan expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or production of
asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of related asset.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Other borrowing expenses are recognized as expenses according to the occurred amount, and
accounted into gain/loss of current term.
The assets meeting capital conditions refer to the fixed assets, investment real estates and
inventories which are constructed or produced in a long time to reach the predicted use or sale state.
When a loan expense satisfies all of the following conditions, it is capitalized: a. Expenditures on
assets have taken place, asset expenditures include the assets used to construct or produce the assets
which meet the capitalization conditions, and expend by cash or transferring non-cash assets or
bearing interest debt; b. Loan costs have taken place; c. The construction or production activities to
make assets to reach the intended use or sale of state have begun.
(2) Duration of capitalization of Loan costs
The capitalization period refers to the period from starting capitalization of loan costs to the stop of
capitalization, the period of the break of capitalization of Loan costs is not included.
When the construction or production meets the intended use or sale of state of capitalization
conditions, the Loan costs should stop capitalization. When the construction or production meets the
conditions of capitalization and can be used individually, the capitalization of the loan costs of the
assets should be stopped.
Where each part of a asset under acquisition and construction or production is completed separately
and is ready for use or sale during the continuing construction of other parts, but it can not be used
or sold until the asset is entirely completed, the capitalization of the borrowing costs shall be ceased
when the asset is completed entirely.
(3) Capitalization Suspension Period
Where the acquisition and construction or production of a qualified asset is interrupted abnormally
and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs
shall be suspended. If the interruption is a necessary step for making the qualified asset under
acquisition and construction or production ready for the intended use or sale, the capitalization of
the borrowing costs shall continue. The borrowing costs incurred during such period shall be
recorded into the profits & losses at the current period, till the acquisition and construction or
production of the asset restarts.
(4)Calculation of the amount of capitalization of Loan costs
Interest expense due to specialized Loan and its auxiliary expenses shall be capitalized before the
asset which satisfies the capitalizing conditions reaches its useable or saleable status.
Interest amount of common Loan to be capitalized equals to accumulated asset expense less
weighted average of specialized loan part of asset expense multiplies capitalizing rate of common
Loan occupied. Capitalizing rate is determined according to weighted average interest of common
Loan.
If the Loan has discount or premium, the discount or premium amount should be determined
according to actual interests in each accounting period. The interest amount should be adjusted in
each period.
19.Intangible assets and R&D expenses
The intangible assets refer to the identifiable non-monetary assets without physical substance owned
or controlled by the company, including software, land use rights, knowhow and etc.
(1)The initial measurement of intangible assets
The cost of the purchased intangible assets includes its buying price, relevant tax and the othe
expenses that are directly attributed to this assets meeting its predetermined objective and other
expenses that occur. The buying price of intangible assets is over the deferred payment under
normal credit conditions, which has the nature of financing materially, the cost of intangible assets
is determined on the basis of the present value of its buying price.
We acquire the mortgaged intangible assets from debtors through debt restructuring and determine
the entry value on the basis of the fair value of the intangible assets,we have the balance between
the book value of debt restructuring and the fair value of intangible assets used for mortgage
charged to the current profit and loss.
The entry value of the non-monetary assets exchanged into by the non-monetary assets are
determined on the basis of the fair value of the assets exchanged out if the exchange of
non-monetary assets has commercial nature and the assets exchanged into or out can be reliably
measured, unless there is authentic evidence indicating that the fair value of assets exchanged into
are more reliable; if the non-monetary assets that cannot meet the above prerequisite use the book
value of the assets exchanged out and relevant taxes payable as the cost of the non-monetary assets,
the profit and loss is not confirmed.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
The entry value of the intangible assets acquired by the absorption merger under the control of one
company is determined by the book value of the merged party; the entry value of the intangible
assets acquired by the absorption merger that is not under the control of one company is determined
by the fair value.
The cost of the intangible assets developed internally includes the materials consumed in developing
the assets, cost of service, registration fees, other patent used in developing, amortization of
concession and interest charges meeting the capitalization conditions and othe direct costs that occur
before the intangible assets meeting the predetermined objective.
(2)Subsequent measurement
The Company acquired intangible assets at the time of analysis to determine its life, is divided into a
finite useful life and intangible assets with indefinite useful life.
a. The intangible assets that have limited serviceable life are amortized by the straight-line method
during the period when the assets can bring about economic interests. The details are as follow:
Items Useful life Judging by
Land use rights 50 years Purchase contract
Software 5-10 years Predicted useful life
b. Intangible assets with uncertain service life may not be amortized. However, the Company shall
check the service life of intangible assets with uncertain service life during each accounting period.
Where there are evidences to prove the intangible assets have limited service life, it shall be
estimated of its service life, and be amortized according to the above method.
(3) The specific standards of the classification of research and development stages of internal R&D
projects of the company
Research stage: the stage of the creative and planned investigation and research activities that is to
acquire and understand new scientific or technological knowledge.
Development stage: the stage that the research achievement or other knowledge are applied in some
plans or designs for the production of newly or substantially improved materials, devices, products
and other activities before the commercial production or usage.
The expenditure of internal research and development projects in the research stage shall be
recorded into the current profits and losses when occurring.
(4) The special standards of the conformation of capitalization for the expenditure in development
stage
The expenditures of internal research and development projects in the development stage shall be
recognized as the intangible assets when the following requirements are simultaneously met:
a. Complete the intangible assets to make it usable or for sale and have the technical feasibility.
b. Have the intention to complete the intangible assets for using or sales.
c. The mode for the economic interest produced by the intangible assets includes the evidence of
there being the market for the products produced by the intangible assets or for the intangible assets
by self, and the usefulness for the assets used internal.
d. There are sufficient technical, financial resources and other resources for support to complete the
development of the intangible assets and there is ability to use or sell the intangible assets.
e. The expenditure belong to the intangible assets in the development stage can be reliably
measured.
The expenditure in the development stage but above-mentioned requirements not met, shall be
recorded into the current profits and losses when occurring. The development expenses recorded
into the profits and losses during previous period shall not be recognized again in the future period.
The capitalized expenses in the development stage are shown as the development costs on the
balance sheet, and shall be transferred to the intangible assets from the date that the project reaching
to the intended use.
20. Impairment of long-term assets
(1) At the end of accounting period, the Company shall check the long-term assets. There may be an
impairment of assets when the following signs occur. The recoverable amount shall be estimated
and the asset impairment loss shall be made in light of the difference that the recoverable amount of
assets is less than the book value when the impairment happens. The signs are stated as follows:
① The current market price of assets falls, and its decrease is obviously higher than the expected
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
drop over time or due to the normal use;
②The economic, technological or legal environment in which the enterprise operates, or the market
where the assets is situated will have any significant change in the current period or in the near
future, which will cause adverse impact on the enterprise;
③The market interest rate or any other market investment return rate has risen in the current period,
and thus the discount rate of the enterprise for calculating the expected future cash flow of the assets
will be affected, which will result in great decline of the recoverable amount of the assets;
④Any evidence shows that the assets have become obsolete or have been damaged substantially;
⑤ The assets have been or will be left unused, or terminated for use, of disposed ahead of schedule;
⑥ Any evidence in the internal report of the enterprise shows that the economic performance of the
assets has been or will be lower than the expected performance, for example, the net cash flow
created by assets or the operating profit (or loss) realized is lower (higher) than the expected
amount;
⑦Other evidence indicates that the impairment of assets has probably occurred.
(2) The evidences to withdraw the impairment provision of long-term investment, fixed assets,
construction in process and intangible asset: at the end of the report period, the Company will
withdraw the asset impairment provision according to the difference that the recoverable amount of
single asset is less than the book value. The recoverable value shall be recognized according to the
high one between the net amount of fair value deducting disposal charge and the current value of the
expected future cash flow of assets. If the recoverable amount of the single asset cannot be obtained,
the recoverable amount shall be recognized on the basis of the asset group to which the asset
belongs.
(3) The business reputation formed by merger of enterprises shall be distributed into the related
asset group at the end of every year, then the asset group shall have the impairment test to measure
the recoverable amount, comparing to the book value, if the recoverable amount of the asset group
is less than the book amount, the difference shall first charge against the book value of the business
reputation which is apportioned to the asset group; if the book value of the business reputation is not
enough to charge against the difference, the uncharged balance shall be distributed by the other
assets of the asset group in accordance with the book value.
(4) The recognition of the asset group under impairment test: the related minimum of asset groups
that can share the synergetic benefit brought from merger through the prediction of the Company.
(5) The above impairment losses of assets cannot be reversed as soon as they are recognized.
21. Long-term amortizable expenses
The long-term amortizable expense refers to all the expenses that occurred and undertaken in the
current period or with the amortization limit of more than 1 year for the company. The long-term
amortizable expense shall be amortized within the benefit period according to the direct method.
The details are as follow:
Items Amortized years Notes
Rental expenses 30 years
Decoration expenses and etc. 3 years
22. Payroll
The payroll means that the enterprise gives various remunerations for obtaining services providing
by the employees or other relevant expenses. It includes the short-term compensation, the welfare
after demission, the demission welfare and the welfare of the long-term employees.
(1)The short-term compensation
Employee compensation refers to the reward or compensation of various modes provided by the
Company which wants to receive the service offering by the employees or to execute the release of
the labor relationship. The employee compensation including the short-term salary, departure
benefits, demission benefits and other long-term employee benefits.
The short-term compensation actually happened during the accounting period when the active staff
offering the
service for the Company should be recognized as liabilities and is included in the current gains
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
and losses or relevant assets cost.
(2)The welfare after demission
The Company divides the departure benefits plan into defined contribution plans and defined benefit
plans. Benefits plan of after demission refer to the agreement between the Company and employees
on the departure benefits, or the regulations or methods formulated by the Company for providing
welfares after demission for the employees. Of which, defined contribution plans refers to the
departure benefits plan that the Company no more undertake the further payment obligations after
the payment and deposit of the fixed expenses for the independent funds; defined benefit plans
refers to the departure benefits plan except for the defined contribution plans.
A. Defined contribution plans
During the accounting period when providing the service for the employees, the Company will
recognize the deposited amount as the liabilities which measured by defined contribution plans and
include in the current gains and losses or the relevant assets cost.
B. Defined benefit plans
Other long-term employee benefits the Company had not executed the defined contribution plans or
met with the conditions of defined benefit plans.
(3)The demission welfare
When the Company is unable to unilaterally withdraw the plan on the cancellation of labor
relationship or the layoff proposal, or when recognizing the costs or expenses related to the
reorganization of paying the demission welfare, should recognize the payroll liabilities from the
demission welfare and include in the current gains and losses.
(4)The welfare of the long-term employees
The Company provides the other long-term employee benefit for the employees, and for those met
with the defined contribution plans, should be disposed according to the above accounting polices of
the defined contribution plans; the others except for the former, should be recognized according to
above accounting polices of the defined benefit plans and measure the net liabilities or net assets of
other long-term employee benefits.
23. Measurement method of estimated debts
(1) Recognition of estimated liabilities
a. The obligation pertinent to contingencies shall be recognized as estimated debts when the
following conditions are satisfied simultaneously:
That obligation is a current obligation of the enterprise;
b. It is likely to cause any economic benefit to flow out of the enterprise as a result of performance
of the obligation;
c. The amount of the obligation can be measured in a reliable way.
The Company shall check the book value of the estimated debts on the balance sheet date. If there is
any exact evidence indicating that the book value cannot really reflect the current best estimate, the
Company will adjust the book value in accordance with the current best estimate.
(2) Accounting of estimated liabilities
Estimated liabilities shall be conducted initial measurement according to the best estimates of
related existing liabilities, when the company recognizes the optimum estimation, it shall be in
overall consideration of risks, uncertainty and time value of currency and other factors related to
contingent matters. When the influence of time value of money is significant, the optimum
estimates shall be determined by discounting relevant future cash outflow
The optimum estimates are conducted as follows:
If there is a continuous range (or area) for the necessary expenses and the same result possibility
within the range, the optimum estimate is recognized according to the middle value, namely the
average of upper limit and lower limit of amount within the range.
If there no exits a continuous range (or area) for the necessary expenses or the different result
possibility within the range even if there is a continuous range, and if there are contingent matters
related to individual item, the optimum estimate is recognized according to the amount that has
most possibility to occur. If there are contingent matters involving multiple items, the optimum
estimate is counted and confirmed as per all the possible results and associated probabilities.
It can be recognized separately as assets when estimated liabilities are paid by the company but can
be fully or partly compensated by a third party and the compensation mostly sure can be received,
which does not exceed the book value of estimated liabilities.
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24. Share-based compensation
(1)Share-based compensation types
Share-based compensation divides into equity settlement and cash settlement.
(2) Determining methods for fair value of equity instruments
The fair value of equity instruments such as options granted and existing in the active market can be
determined by reference to the quotations in the active market. Otherwise, it is determined by option
pricing model, which should take into account the following factors: a. exercise prices of options;b.
validity of options; c. current prices of underlying shares; d. estimated volatility of share prices; e.
estimated dividends; f. risk-free interest rate of options within validity.
When determining the equity instruments fair value of the granted date, the company considers the
impact of the market conditions and non-vesting conditions as specified in Share-based
compensation agreements. If there are non-vesting conditions and employees or any other parties
satisfy all non-market vesting conditions (for example, service period), Share-based compensation
can be recognized as costs and expenses for received services.
(3)Basis of best exercisable equity instruments estimate
Every balance sheet day during the vesting period, the company makes best estimate according to
the most updated number of employees that are eligible to exercise their options and adjusts the
quantity of exercisable equity instruments. On vesting dates, the final estimated quantity of
exercisable equity instruments is consistent with the actual exercisable quantity.
(4)Accounting treatment for implementation, amendment and termination of share-based
compensation
Share-based compensation by equity settlement is calculated according to the fair value of granted
equity instruments. The Company can count it in costs and expenses by reference to the fair value of
the granted date and increase capital reserve accordingly if it can be exercised immediately after
being granted. If it cannot be exercised till services or performance meets the conditions during the
vesting period, then on every balance sheet date during the vesting period, received services can be
counted in related costs or expenses and capital reserve by reference to best estimates of exercisable
equity instruments quantity and its fair value of the granted date. No adjustments will be made on
already recognized costs or expenses and ownership equity after vesting dates.
For share-based compensation by cash settlement, the fair value is measured by reference to that of
the liabilities determined based the shares or other equity instruments the company undertakes. The
company can count it as costs and expenses by reference to the fair value of the granted date and
increase liabilities accordingly if it can be exercised immediately after being granted. If it cannot be
exercised till services or performance meets the conditions during the vesting period, then on every
balance sheet date during the vesting period, received services can be counted in related costs or
expenses and liabilities by reference to best estimates of exercisable equity instruments quantity and
the fair value of the liabilities the company undertakes. On every balance sheet date and settlement
date before the related liabilities are cleared, the fair value is re-calculated and the changes are
counted in current profit and loss.
(5) Equity instruments changes and accounting treatment
If the granted equity instruments are cancelled during the vesting period, the company treats it as
accelerated vesting and counts in current profit and loss the amounts that should be recognized
during the rest vesting period and recognizes capital reserve accordingly at the same time. If
employees or other parties can choose but fail to satisfy non-vesting conditions during the vesting
period, the Company sees this as cancellation of granted equity instruments.
25. Revenue recognition
(1) The recognition of the revenue from selling goods: the revenue from selling shall be recognized
by the following conditions: The significant risks and rewards of ownership of the goods have been
transferred to the buyer by the Company; the Company retains neither continuous management right
that usually keeps relation with the ownership nor effective control over the sold goods; the relevant
amount of revenue can be measured in a reliable way; the relevant revenue and costs of selling
goods can be measured in a reliable way.
(2) Giving of asset using rights: Income from giving of assets is recognized when satisfying
requirements: related economic benefit flows in very possibly, income can be measured reliably.
1) Amount of interest income is calculated according to the time and actual interest rate of the
monetary capital is used by other party.
2) Income of using fee is calculated upon the charge period and calculation provided by the related
contract or agreement.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(3) Labor revenues
When the results of the transaction of the company could be reliable estimated (that is the total
revenues and the total costs of labor service could be reliable measured and the completion degree
of the labor service could be reliable with the relevant price accounts could flow in), the company
would recognized the realization of the revenues on the settlement date according to the completion
percentage method. When the results of the transaction of the company could not be reliable
estimated, the company should recognized the revenues on the settlement date acc company ording
to the labor service cost amount which had occurred and be estimated that could be compensated
and include the happened cost in the current gains and losses.
(4)Construction contracts
When the result of the construction contract is able to be evaluated reliably at the balance sheet date,
the income and cost of the contract are recognized on completion percentage basis.
If the result of the construction contract is not able to be evaluated reliably, but the contract cost
maybe recovered, the income is recognized at the cost actually recovered, and the cost of the
contract is recognized as contract expenses of the current period when it is occurred.
1) Contract progress is recognized at the ratio of accumulative actual cost on the predicted complete
cost.
2) In case the expected total cost is greater than the total income, the expected loss will be
recognized as expense of the current period. If the construction is in process, the balance is
accounted as inventory impairment provision; if the contract is not executed, the balance is
accounted as expected liability.
(5) Assets transfers with buy-back conditions
If the company signs buy-back agreement with the purchase party when selling products or
transferring other assets, it should make a judgment whether the product sale satisfies revenue
recognition conditions. As buy-back after sale is financing transaction, the company does not
recognize sales revenue when delivering products or assets. During buy-back, interests are put aside
and counted in financial expenses based on the differences between buy-back and sales prices.
26. Calculation method of government grants
The government grants related to the proceeds, if those used for compensating the relevant future
expenses or losses of the enterprise shall be recognized as deferred income and shall, during the
period when the relevant expenses are recognized, recorded in the current profits and losses; or if
those used for compensating the relevant expenses or losses that have been incurred to the enterprise
shall be directly recorded in the current profits and losses.
The government grants related to the assets shall be recognized as deferred income and shall be
distributed averagely in the related asset using period, then counted into current loss and interest.
However, government subsidiary according to nominated amount shall be counted into current loss
and interest directly.
27. Deferred income tax assets/Deferred income tax liability
Deferred income tax assets and liabilities are calculated and recognized according to the differences
(temporary differences) between the taxation base of assets and liabilities and the book value. As at
balance sheet dates, both are calculated at applicable tax rates during the period it is anticipated to
take the assets back or clear the liabilities.
(1) References for confirmation of deferred income tax assets
The Company recognizes the deferred tax income assets arising from deductible temporary
differences to the limit of the deductible losses and taxable income that it probably would achieve to
reduce deductible temporary differences and carry forward. However, it does not recognize those
arising from the initial measurements of assets or liabilities in the following transactions.
a.Transactions are not business merge; b. It neither affects the accounting profit nor taxable income
or deductible losses while transactions being made.
For the deductible temporary differences related to the investments by associated enterprises, which
meet the following conditions, deferred tax assets should be recognized accordingly: the temporary
differences are probable to revert in the foreseeable future and it is very likely to achieve taxable
income to deduct such differences.
(2)The confirmation basis of deferred income tax liabilities
The Company recognizes the payable but not paid yet taxable temporary differences of current or
prior periods as deferred tax liabilities, which exclude the following:
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
a. The temporary differences that are formed at initial measurement of goodwill;
b. Non-business merge transactions or events that neither affect accounting profits nor the
temporary differences arising from taxable income (or deductible losses);
c. The taxable temporary differences related to the investments by the subsidiaries and associated
enterprises, which can revert in a controllable timing but will not revert in the foreseeable future.
28.Lease
(1) Accounting of operational leasing
a. The leasing fees paid for the leased assets by the company shall be recorded as the current
expense according to the straight-line method in the whole lease term not excluding the rent free
period. The initially direct expense related to the lease transactions paid by the company shall be
recognized as the current expense.
When the assets lessor has assumed the lease-related expenses which should be borne by the
company, the company shall deduct these expenses from the total amount of rent, amortize in the
lease term according to the rents after deducted and record as the current expenses.
b. The leasing fees received for the leased assets by the company shall be recognized as the lease
income according to the straight-line method in the whole lease term not excluding the rent free
period. The initially direct expense related to the lease transactions paid by the company shall be
recognized as the current expense. For a large of amount, it will be capitalized and recorded as the
current revenue based on the same confirmation of lease income during the whole lease period.
When the company has assumed the lease-related expenses which should be borne by the lessee, the
company shall deduct these expenses from the total amount of rent and amortize in the lease term
according to the rents after deducted.
(2) Accounting Method for Financing Leases
a. The assets acquired under financing leases: the lower value between the fair value of leased assets
and the present value of the minimum lease payments is recognized as the recorded value, the
minimum lease payments are recognized as the recorded value of long-term payables, and the
difference is recognized as unrecognized finance expense at the inception of the lease.
The company shall adopt the effective interest method to amortize and record as the financial costs
during the assets lease term.
b. Finance leased assets: the company inception of the lease, the finance lease receivables, the
difference between the present value and the residual value of its unsecured recognized as
unrealized financing income recognized in the respective period of future lease rental income
received, initial direct costs related to the transaction with the rental companies, and included in the
initial measurement of the finance lease receivable and reduce the amount of revenue recognized
over the lease term.
29. Changes in significant accounting policies and estimates
(1) Change of main accounting policies
Not applicable.
(2) Change of main accounting estimations
Not applicable.
VI.Taxation
1. Value added tax (‘VAT’)
The Group is subject to VAT, which is a tax charged on top of the selling price at a general rate of
17% or 13% or 6% depending on different kinds of products. An input credit is available whereby
VAT previously paid on purchases of raw materials and semi-finished products can be used to offset
the VAT on sales to determine the net VAT payable.
2. The business tax rate is 5% or 3% of revenue.
3. Urban maintenance and construction tax is 7% of turnover tax payable.
4. Education surtax is 3% of turnover tax payable.
5. Local education surtax is 2% of turnover tax payable.
6. Income tax
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(1)The parent company’s income tax was measured at 15%.
(2)Income tax of subsidiaries and associates
Taxation on profit of subsidiaries and associates is calculated at the applicable rates in accordance
with the relevant tax regulations. Certain subsidiaries and associates enjoy preferential income tax
policies with approvals from tax authorities. The applicable income tax rates of major subsidiaries
and associates are as follows:
Relationship with Applicable income
Names of the entities the Company tax rate in 2015
Dalian Bingshan Group Refrigeration Installation Co., Ltd. Subsidiary 25%
Dalian Binshan Group Sales Co., Ltd., Subsidiary 25%
Dalian Bingshan Metal Processing Co. Ltd. Subsidiary 25%
Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. Subsidiary 25%
Dalian Bingshan Air-Conditioning Equipment Co. Ltd. Subsidiary 25%
Dalian Bingshan Guardian Automation Co., Ltd. Subsidiary 25%
Wuhan New World Refrigeration Industrial Co., Ltd. Subsidiary 15%
The parent company was affirmed to be hi-tech enterprise by Dalian Municipal Bureau of Science
and Technology, Dalian Municipal Bureau of Finance, the State Administration of Taxation Dalian
Municipal Office and Dalian Local Taxation Bureau, and WNWRI was affirmed to
be hi-tech enterprise by Wuhan Municipal Bureau of Science and Technology, Wuhan Municipal
Bureau of Finance, the State Administration of Taxation Wuhan Municipal Office and Wuhan Local
Taxation Bureau. Their applicable income tax rates were 15% for 2015.
VII. Notes to the consolidated financial statements
1. Monetary fund
Items 30-06-2015 31-12-2014
Cash on hand 61,557.65 67,783.07
Cash in bank 330,029,689.29 457,395,413.41
Other monetary fund 34,920,526.90 51,048,269.54
Total 365,011,773.84 508,511,466.02
The restrained amount of monetary fund is shown as below.
Items 30-06-2015 31-12-2014
Deposit for bank acceptances 30,005,360.47 46,780,736.99
Deposit for letter of credit 2,860,552.55
Deposit for letter of guarantee 4,915,166.43 1,406,980.00
Cash in bank for warrant
Total 34,920,526.90 51,048,269.54
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2. Notes receivable
Items 30-06-2015 31-12-2014
Bank acceptance 28,510,188.32 4,111,157.06
Trade acceptance 20,269,947.99 10,744,800.64
Total 48,780,136.31 14,855,957.70
(1) There is no pledged notes receivable at the end of the reporting period.
(2) The notes receivable endorsed but not matured at the end of the reporting period.
Items The derecognization amount Not derecognization amount
Bank acceptance 109,953,542.84
Total 109,953,542.84
(3) The reason of the ending balance of notes receivable decreased 228.35% compared with the
beginning balance was the notes payment increased.
3. Accounts receivable
(1) Classification
30-06-2015
Categories Balance Provision for doubtful debts
Book value
Amount Proportion Amount Proportion
Bad debt provided on group
680,938,857.71 100.00% 114,228,837.40 16.78% 566,710,020.31
basis
Total 680,938,857.71 100.00% 114,228,837.40 16.78% 566,710,020.31
Continued:
31-12-2014
Categories Balance Provision for doubtful debts
Book value
Amount Proportion Amount Proportion
Bad debt provided on group
555,119,550.49 100.00% 116,238,720.37 20.94% 438,880,830.12
basis
Total 555,119,550.49 100.00% 116,238,720.37 20.94% 438,880,830.12
Accounts receivable which bad debt provisions are provided on age basis in the group
30-06-2015
Account ages
Amount Provision for bad debts Proportion rates
Within 1 year 448,748,434.71 22,437,421.71 5.00%
1 to 2 years 99,762,970.06 9,976,297.01 10.00%
2 to 3 years 49,338,636.27 14,801,590.88 30.00%
3 to 4 years 26,581,381.60 13,290,690.80 50.00%
4 to 5 years 13,922,990.37 11,138,392.30 80.00%
Over 5 years 42,584,444.70 42,584,444.70 100.00%
Total 680,938,857.71 114,228,837.40
55
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB 1,923,170.15were accrued provision for bad debts, and RMB 61,453.00
were regained.
Receivable accounts written off before but regained during the current period:
Companies Received amount Regained form Notes
Keeping
Shandong Qi Long Chemical Co., Ltd. 38,000.00 Bank deposits
Collection
Keeping
Linan Fengye food Co., Ltd. 23,453.00 Bank deposits
Collection
Total 61,453.00
(3) Accounts receivable being written-off during the current period
Items Written off amount
38 Clients 3,994,506.12
The reasons of accounts receivable being written-off include termination of operation and
disability of payment, winning lawsuits but not finding executable assets, small balance being not
collected for long time, and disagreement rework charges etc, and the accounts receivable being
written-off during the current period was permitted by the board of directors.
(4) Top 5 on amount of accounts receivable
Proportion Provision for bad
Companies Amount
(%) debts
Dalian Xinghai Bay Development and Construction
Management Centre 3.38 11,831,693.00
23,022,693.00
Beijing Huashang Bingshan Refrigeration Equipment
Co., Ltd. 3.08 1,048,918.35
20,978,367.08
Dalian Zhongyi Refrigeration Equipment Co., Ltd. 19,200,000.00 2.82 960,000.00
FAW Car Co., Ltd. 1.21
8,241,529.00 412,076.45
Xu Zhou Yu Run Agricultural Products global
8,200,000.00 1.20 410,000.00
purchasing Co. Ltd.
Total 79,642,589.08 11.69 14,662,687.80
4. Advances to suppliers
(1) The aging of advances to suppliers
30-06-2015 31-12-2014
Account ages
Amount Proportion Amount Proportion
Within 1 year 42,504,696.71 99.82% 18,897,672.41 99.18%
1 to 2 years 20,507.00 0.05% 121,597.34 0.64%
2 to 3 years 28,265.00 0.07% 6,000.00 0.03%
3 to 4 years 28,000.00 0.06% 28,000.00 0.15%
Total 42,581,468.71 -- 19,053,269.75 --
The ending balance of account paid in advance increased 123.49% over that of period-begin, mainly
because the amount for procurement paid in advance increased.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(2)Top 5 on amount of advances to suppliers
Proportion
Companies Amount Ages Reasons
(%)
Prepayment for
Dalian Bingshan Engineering & Trading Co. , Ltd. 5,921,284.85 13.91 2015
goods
Dalian construction engineering labor insurance Prepayment for
4,442,808.00 10.43 2015
management office finance payment account goods
Prepayment for
Hei Longjiang Da Zhou Refrigeration Equipment Co., Ltd. 2,657,300.00 6.24 2015
goods
Prepayment for
Dalian Yida construction engineering Co., Ltd. 2,031,335.00 4.77 2015
goods
State Grid Liaoning Electric Power Co., Ltd. Dalian Prepayment for
1,897,529.19 4.46 2015
Power Supply Company goods
Total 16,950,257.04 39.81
5. Interest receivable
Items 30-06-2015 31-12-2014
Interest on Term Deposits 2,491,608.34 4,998,982.40
Total 2,491,608.34 4,998,982.40
The ending balance of interest receivable decreased 50.16% over that of period-begin, mainly
because the basis of deposit reduce, then the undue interest income declined
6. Dividends receivable
Names 30-06-2015 31-12-2014
Panasonic Compressor (Dalian) Co. , Ltd. 5,200,000.00
Panasonic Cold-Chain (Dalian) Co. , Ltd. 34,000,000.00
Total 39,200,000.00
The ending balance of dividend receivable increased larger over that of period-begin, mainly due
to the undue dividend receivable increased.
7. Other accounts receivable
(1) Classification
30-06-2015
Items Balance Provision for doubtful debts
Book value
Amount Proportion Amount Proportion
Bad debt provided on group basis 45,706,963.73 100.00% 5,518,203.32 12.07% 40,188,760.41
Total 45,706,963.73 100.00% 5,518,203.32 12.07% 40,188,760.41
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Continued：
31-12-2014
Items Balance Provision for doubtful debts
Book value
Amount Proportion Amount Proportion
Bad debt provided on group basis 39,244,121.02 100.00% 4,977,677.00 12.68% 34,266,444.02
Total 39,244,121.02 100.00% 4,977,677.00 12.68% 34,266,444.02
There is no major single amount and bad debt provision provided individually.
Other accounts receivable which bad debt provisions are provided on age basis in the group:
30-06-2015
Account ages
Amount Provision for bad debts Proportion rates
Within 1year 32,061,809.90 1,603,090.50 5.00%
1 to 2 years 9,143,496.96 914,349.70 10.00%
2 to 3 years 1,335,517.48 400,655.24 30.00%
3 to 4 years 770,260.44 385,130.22 50.00%
4 to 5 years 904,506.45 723,605.16 80.00%
Over 5 years 1,491,372.50 1,491,372.50 100.00%
Total 45,706,963.73 5,518,203.32
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB 552,114.82 were accrued provision for bad debts, and no bad debts were
regained.
(3) The write-off of other accounts receivable during the current year
Items Written off amounts
2 Clients 11,588.50
The write-off other accounts receivable was written off and the reason was not being collected for long
time.
(4) The nature of other accounts receivable
Items 30-06-2015 31-12-2014
Guarantee deposits 28,489,385.64 25,442,507.63
Petty cash 9,426,310.54 4,758,015.42
To or fro accounts 3,591,846.32 3,954,641.30
Prepayments over settlement periods 3,557,444.96 4,047,765.86
Others 641,976.27 1,041,190.81
Total 45,706,963.73 39,244,121.02
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(5) Top 5 on amount of other accounts receivable
Proportio Provision for
Companies Contents Amount Ages
n bad debts
Dalian Tianbao Green Food Less than 1
Performance bonds 18,000,000.00 39.38% 900,000.00
Co., Ltd year
Dalian Tianyi Info-Technology Prepayments over
1,779,500.00 1-2 years 3.89% 177,950.00
Co., Ltd. settlement periods
Jinzhou Dalian New District Less than 1
organs and institutions of Deposits in security 1,586,623.95 year ,1-2 3.47% 102,482.37
years,2-3years
financial accounting center
Tianjin Construction Team
Communication Service Guarantee deposits 1,000,000.00 Over 5 years 2.19% 1,000,000.00
Center
Less than 1
Dalian Detai Town Gas China
Deposits in security 600,000.00 year ，1-2 1.31% 80,000.00
Co., Ltd.
years
Total 22,966,123.95 50.24% 2,260,432.37
8. Inventories
(1) Costs
30-06-2015 31-12-2014
Items Provision for Provision for
Book balance impairment of Book value Book balance impairment of Book value
inventories inventories
Raw materials 49,400,713.52 7,463,862.07 41,936,851.45 51,805,680.92 7,463,862.07 44,341,818.85
Materials on
consignment for further 2,208,539.66 2,208,539.66 2,394,839.67 2,394,839.67
processing
Low-value
34,525.65 34,525.65 81,422.57 81,422.57
consumptions
Work-in-progress 73,150,888.91 1,192,940.12 71,957,948.79 81,736,391.62 1,192,940.12 80,543,451.50
Self-manufactured
31,696,935.39 2,532,083.34 29,164,852.05 27,189,545.15 2,532,083.34 24,657,461.81
semi-finished products
Finished goods 113,388,913.49 2,884,241.52 110,504,671.97 124,845,367.55 2,884,241.52 121,961,126.03
Constructing projects 36,648,554.34 36,648,554.34 40,898,986.13 40,898,986.13
Total 306,529,070.96 14,073,127.05 292,455,943.91 328,952,233.61 14,073,127.05 314,879,106.56
(2) Provision for impairment of inventories
Current year addition Current year disposal
Items 31-12-2014 30-06-2015
Provision Others Reversal Written-off Others
Finished goods 2,884,241.52 2,884,241.52
Raw materials 7,463,862.07 7,463,862.07
Work-in-progress 1,192,940.12 1,192,940.12
Self-manufactured
2,532,083.34 2,532,083.34
semi-finished products
Total 14,073,127.05 14,073,127.05
The Company carried out impairment test for the inventory at period-end, there are no inventory
falling price reserves need to be accrued in the Period.
59
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
9. Other current assets
Items 30-06-2015 31-12-2014
Enterprise income tax prepaid 641,717.78 1,400,309.96
Prepaid expenses 786,802.37 934,829.83
Total 1,428,520.15 2,335,139.79
The ending balance of other current assets decreased 38.83% over that of period-begin, mainly
because the advance payment of income tax are decreased in the Period.
10. Available for sale financial assets
30-06-2015 31-12-2014
Items Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Debt instruments
available for sale
Equity instruments
1,051,150,318.80 5,224,770.80 1,045,925,548.00 47,653,159.50 5,224,770.80 42,428,388.70
available for sale
Measured by fair
1,033,596,054.30 1,582,164.89 1,032,013,889.41
value
Measured by 17,554,264.50 3,642,605.91 13,911,658.59 47,653,159.50 5,224,770.80 42,428,388.70
cost
Others
Total 1,051,150,318.80 5,224,770.80 1,045,925,548.00 47,653,159.50 5,224,770.80 42,428,388.70
(1) Equity instruments available for sale measured by Fair value
Equity t instruments Debt instruments
Items Total
available for sale available for sale
Cost of Equity instrument/ amortized cost of debt instrument 30,098,895.00 30,098,895.00
Fair value 1,033,596,054.30 1,033,596,054.30
The total amount of fair value change in other
852,972,585.40 852,972,585.40
comprehensive income
The amount of impairment 1,582,164.89 1,582,164.89
Total 1,032,013,889.41 1,032,013,889.41
(2) Equity instruments available for sale measured by cost at the end of current year
Book balance
Names Increased Decreased
Beginning Ending
during current during current Shareholding(%)
balance balance
period period
Liaoning Mike Group Co., Ltd. 1,020,000.00 1,020,000.00 3.57
Guotai Junan Investment Management 0.22
Co., Ltd. 3,057,316.00 3,057,316.00
Thermo King Container Temperature 17.80
Control (Suzhou) Co., Ltd. 11,207,806.00 11,207,806.00
Wuhan Steel and Electric Co., Ltd. 1,315,142.50 1,315,142.50 0.06
Liaoning Enterprises United Industry 4.2
Company 105,000.00 105,000.00
Zibo Traction Motor Co., Ltd. 849,000.00 849,000.00 0.76
Total 17,554,264.50 17,554,264.50
60
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Continued：
Provision for impairment
Cash
Decreased dividends
Names Increased
Beginning during Ending during the
during current
balance current balance current period
period
period
Liaoning Mike Group Co., Ltd. 310,000.00
Guotai Junan Investment
2,688,605.91 2,688,605.91
Management Co., Ltd.
Thermo King Container Temperature
Control (Suzhou) Co., Ltd.
Wuhan Steel and Electric Co., Ltd.
Liaoning Enterprises United Industry
105,000.00 105,000.00
Company
Zibo Traction Motor Co., Ltd. 849,000.00 849,000.00
Total 3,642,605.91 3,642,605.91 310,000.00
On 26 June 2015, Guotai Junan Securities Co., Ltd. (“Guotai Junan” for short) listed on Shanghai Stock Exchange,
stock code 601211; as for the 30,098,895 shares of Guotai Junan, the Company measured the shares on fair value.
61
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
11. Long-term equity investments
Increase/Decrease
Provision
Beginning Gains and losses Adjustment Cash bonus or Provision for for
Name Changes Ending balance
balance recognized of other profits impairment of impairme
Increased Decreased of other Others
under the equity comprehensiv announced to the current nt
equity
method e income issue period
ⅠJoint venture
Dalian Bingshan – P&A
Recreation Development 3,553,919.97 -377,150.35 3,176,769.62
Engineering Co., Ltd.
subtotal 3,553,919.97 -377,150.35 3,176,769.62
Ⅱ Associates
Dalian Bingshan Engineering
13,716,985.57 1,302,858.87 15,019,844.44
&Trading Co.,Ltd.
Panasonic Refrigeration
155,826,086.27 -3,011,036.73 5,200,000.00 147,615,049.54
(Dalian) Co., Ltd.
Dalian Honjo Chemical Co.,
9,403,913.18 231,620.31 1,203,061.37 8,432,472.12
Ltd.
Panasonic Cold-Chain
215,573,606.48 2,965,904.37 8,000,000.00 210,539,510.85
(Dalian) Co., Ltd.
Keinin-Grand Ocean Thermal
Technology (Dalian) Co., 42,333,942.39 7,612,764.78 9,600,000.00 40,346,707.17
Ltd.
Panasonic Compressor
432,515,006.40 29,441,902.46 34,000,000.00 427,956,908.86
(Dalian) Co., Ltd.
Dalian Sanyo Meica
23,233,848.71 -889,967.73 22,343,880.98
Electronics Co., Ltd.
MHI Bingshan Refrigeration
29,294,087.63 -2,308,578.44 26,985,509.19
(Dalian) Co.,Ltd.
Beijing Huashang Bingshan
Refrigeration and
1,425,989.62 1,754,200.00 -512,013.13 2,668,176.49
Air-conditioning Machinery
Co., Ltd.
Dalian Fuji Bingshan Vending
89,896,843.61 12,411,144.13 102,307,987.74
Machine Co., Ltd.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Increase/Decrease
Provision
Beginning Gains and losses Adjustment Cash bonus or Provision for for
Name Changes Ending balance
balance recognized of other profits impairment of impairme
Increased Decreased of other Others
under the equity comprehensiv announced to the current nt
equity
method e income issue period
Daliian Sanyo High-Efficient
Refrigeration System Co., 22,455,509.02 105,357.69 22,560,866.71
Ltd.
Dalian Fuji Bingshan Vending
2,450,000.00 1,110,275.29 3,560,275.29
Machine Sales Co., Ltd.
1,035,675,818.
subtotal 4,204,200.00 48,460,231.87 58,003,061.37 1,030,337,189.38
88
1,039,229,738.
Total 4,204,200.00 48,083,081.52 58,003,061.37 1,033,513,959.00
85
(1) As for the resolution of the Board, the Company increased RMB 3.5084 million for the Beijing Huashang Bingshan Refrigeration AC Complete Plant Co., Ltd.
After capital increased, the Company’s proportion of contribution did not change, holding 49% equity of Beijing Huashang Bingshan Refrigeration AC Complete
Plant Co., Ltd. The Company invested RMB 1.7542 million till end of 30 June 2015.
(2) As for the resolution of the Board, the Company and Fuji Electric jointly invested the Fuji Bingshan Vending Machine Sales Co., Ltd. with registered capital of
RMB 5 million. The Company contributed RMB 2.45 million with 49% equity of the Fuji Bingshan Vending Machine Sales Co., Ltd. held. Till end of 30 June 2015,
the Company invested RMB 2.45 million.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
12. Investment property
(1)Investment property details
Construction
Items Buildings Land-use-rights Total
in progress
1. Original value
(1)Beginning balance 25,259,944.57 25,259,944.57
(2)Current year addition
Outsourcing
Transferred from Inventories\Fixed
asset-original cost\Construction in
progress
Enterprise merger increase
Shareholders invest
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance 25,259,944.57 25,259,944.57
2.Accumulated depreciation
(1)Beginning balance 151,035.57 151,035.57
(2)Current year addition 305,662.50 305,662.50
provision or amortization 305,662.50 305,662.50
Enterprise merger increase
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance 456,698.07 456,698.07
3..Provision for impairment
(1)Beginning balance
(2)Current year addition
provision or amortization
Enterprise merger increase
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance
4.Book value
(1)Ending book value 24,803,246.50 24,803,246.50
(2)Beginning book value 25,108,909.00 25,108,909.00
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(2) Investment property without owner’s certificates
Items Book value Reasons
# 6 workshop building on No. 106 Liaohe East Rd, Dalian
24,803,246.50 Final accounts uncompleted
Economic and Technology Development Zone
Total 24,803,246.50
(3) Explanation of investment property
The company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co.,Ltd., and rent #
6 workshop building located on No. 106 Liaohe East Rd, Dalian Economic and Technology
Development Zone to MHI Bingshan Refrigeration (Dalian) Co., Ltd. The rental area is 15,259.04
square meters, and the rent term till 16th July, 2029. The annual rent fee is RMB 4.2 million after
considering the time value of money.
13. Fixed assets
(1) Fixed assets details
Other
Items Buildings Machinery Vehicles Total
equipments
1. Original value
(1)Beginning balance 351,970,071.36 568,188,704.97 25,291,805.92 18,442,757.75 963,893,340.00
(2)Current year addition 607,362.38 588,868.38 672,655.56 1,263,925.11 3,132,811.43
Purchased 443,000.00 588,868.38 172,655.56 1,263,925.11 2,468,449.05
Transferred from
Construction in progress 164,362.38 164,362.38
Enterprises merger
Shareholders investment
Leased in from financing
Other transferred in 500,000.00 500,000.00
(3)Current year reduction 8,743.59 162,960.00 109,805.28 281,508.87
Disposal 8,743.59 162,960.00 109,805.28 281,508.87
Leased out from
financing
Other transferred out
(4)Ending balance 352,577,433.74 568,768,829.76 25,801,501.48 19,596,877.58 966,744,642.56
2.Accumulated depreciation
(1)Beginning balance 121,972,177.31 397,048,925.70 14,903,060.69 13,383,677.27 547,307,840.97
(2)Current year addition 4,238,025.56 12,393,679.74 1,009,345.11 577,510.29 18,218,560.70
Provision 4,238,025.56 12,393,679.74 1,009,345.11 577,510.29 18,218,560.70
Enterprises merger
increased
Other transferred in
(3)Current year disposal 8,306.41 146,664.00 98,824.52 253,794.93
Disposal 8,306.41 146,664.00 98,824.52 253,794.93
Leased out from
financing
Other transferred out
(4)Ending balance 126,210,202.87 409,434,299.03 15,765,741.80 13,862,363.04 565,272,606.74
3..Provision for impairment
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Other
Items Buildings Machinery Vehicles Total
equipments
(1)Beginning balance 2,292,229.72 2,292,229.72
(2)Current year addition
Withdrew
Enterprises merger
increase
Other transferred in
(3)Current year disposal
Disposal
Leased out from
financing
Other transferred out
(4)Ending balance 2,292,229.72 2,292,229.72
4.Net Book value
(1)Ending book value 226,367,230.87 157,042,301.01 10,035,759.68 5,734,514.54 399,179,806.10
(2)Beginning book value 229,997,894.05 168,847,549.55 10,388,745.23 5,059,080.48 414,293,269.31
(2)There were no idle fixed assets during the current period.
(3) Fixed assets without owner’s certificates
Items Book value Reasons
Buildings 65,359,619.05 Final accounts uncompleted
Total 65,359,619.05
(4) Wuhan New World Refrigeration Industrial Co., Ltd. borrowed RMB60,000,000 from bank and
mortgaged with its buildings, machinery and land-use-rights with total book value
RMB172,787,581.89 which included book value of buildings RMB76,773,439.62 and book value
of machinery RMB41,508,458.27. Please refer to the note Ⅴ.18.
14. Project in construction
(1) Details
Transferred Other
into fixed decreas Percen
Increased
Balance of assets ed Balance of Sources of tage of
Items Budget during current
31-12-2014 during during 30-06-2015 funds compl
period
current current etion
period period
Internally
Buildings
353,080,000.00 17,594,050.11 26,000,420.82 164,362.38 43,430,108.55 generated 13%
renovation
funds
Internally
Machinery 1,000,000.00 921,399.35 921,399.35 generated 92%
funds
Total 354,080,000.00 18,515,449.46 26,000,420.82 164,362.38 44,351,507.90
(2) There was no provision for impairment needed withdrawn.
(3) Construction in process increased 139.54% over that of last Period, refers to investment for the
new factory.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
15. Intangible assets
(1) Intangible assets details
Items Land-use-rights Knowhow Others Total
1. Original value
(1)Beginning balance 176,504,398.53 515,224.41 10,023,747.44 187,043,370.38
(2)Current year addition 169,316.25 169,316.25
Purchase 169,316.25 169,316.25
Internal research and
development
Enterprises merger increase
Shareholders invest
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance 176,504,398.53 515,224.41 10,193,063.69 187,212,686.63
2. Amortization
(1)Beginning balance 28,866,655.89 515,224.41 3,748,179.83 33,130,060.13
(2)Current year addition 1,765,044.77 415,412.87 2,180,457.64
Provision 1,765,044.77 415,412.87 2,180,457.64
Enterprises merger increase
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance 30,631,700.66 515,224.41 4,163,592.70 35,310,517.77
3..Provision for impairment
(1)Beginning balance
(2)Current year addition
Withdraw
Enterprises merger increase
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance
4.Net book value
(1)Ending book value 145,872,697.87 6,029,470.99 151,902,168.86
(2)Beginning book value 147,637,742.64 6,275,567.61 153,913,310.25
(2) There were no intangible assets increased by internal research and development.
67
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(3) Please refer to the note Ⅴ.18 for land-use-rights mortgaged.
16. Long-term deferred expenses
Increased Amortized
Other
Items 31-12-2014 during current during current 30-06-2015
decrease
period period
Employee’s dormitory use right 2,704,561.98 69,239.16 2,635,322.82
Renovation and rebuilding 3,085,642.38 645,759.24 2,439,883.14
Inspection services 83,194.63 24,253.62 58,941.01
Total 5,873,398.99 739,252.02 5,134,146.97
17. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets had not been off-set
30-06-2015 31-12-2014
Items Deductible Deductible
temporary Deferred tax assets temporary Deferred tax assets
difference difference
Provision for assets impairment 99,035,680.34 17,724,007.91 98,014,616.89 16,786,587.33
Equity incentive expenses 4,876,208.00 731,431.20
Total 103,911,888.34 18,455,439.11 98,014,616.89 16,786,587.33
(2) Deferred liabilities tax assets had not been off-set
30-06-2015 31-12-2014
Items Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Changes in fair value of
available for sale financial assets 1,003,497,159.30 150,524,573.90
Total 1,003,497,159.30 150,524,573.90
(3)Temporary difference which not recognized deferred income tax assets
Items 30-06-2015 31-12-2014
Provision for impairment 42,301,487.95 44,791,908.06
Deductible losses 15,493,479.78 9,725,928.72
Total 57,794,967.73 54,517,836.78
The temporary difference was not recognized as deferred income tax assets, because it is uncertain
if there will be enough taxable income.
(4) Deductible losses of unrecognized deferred income tax assets will due the following years
Items 30-06-2015 31-12-2014 Notes
2017 975,555.72 975,555.72
2018 4,717,859.29 4,717,859.29
2019 4,032,513.71 4,032,513.71
2020 5,767,551.06
Total 15,493,479.78 9,725,928.72 --
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
18. Short-term loans
Terms of loans 30-06-2015 31-12-2014
Mortgage loan 60,000,000.00 60,000,000.00
Total 60,000,000.00 60,000,000.00
(1) Wuhan New World Refrigeration Industrial Co., Ltd. borrowed short-term loan RMB60,000,000
from bank and mortgaged with its buildings, machinery and land-use-rights.
19. Notes payable
Items 30-06-2015 31-12-2014
Trade acceptance notes 6,241,714.55
Bank acceptance notes 120,832,581.67 103,304,788.06
Total 120,832,581.67 109,546,502.61
20. Accounts payable
Items 30-06-2015 31-12-2014
Payable for materials 498,213,365.90 475,503,139.38
Payable for projects 32,474,626.71 6,919,723.26
Payable for equipments 14,667,355.39 28,653,675.18
Total 545,355,348.00 511,076,537.82
There was no big amount among the accounts payable aged more than 1 year.
21. Accounts received in advance
(1) Details
Items 30-06-2015 31-12-2014
Advances on sales 104,820,567.76 137,629,315.42
Total 104,820,567.76 137,629,315.42
(2) Accounts received in advance aged over 1 year
Items 30-06-2015 Reasons
Inner Mongolia Datang Dingwang Chemical
1,962,000.00 Unsettled contract payments on sets projects
Co. Ltd.
Jiangsu Ruixiang Chemical Co., Ltd. 1,563,950.00 Unsettled contract payments on sets projects
Yanzhou Coal Mine Yishan Chemical Co., Ltd. 960,135.60 Unsettled contract payments on sets projects
Total 4,486,085.60
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
22. Payroll payable
(1) Details
Increased during Decreased during
Items 31-12-2014 30-06-2015
current period current period
Short-term salary 55,993,637.27 115,035,849.24 139,885,926.05 31,143,560.46
Departure welfare-defined
contribution plans 17,131,851.20 17,131,851.20
Termination benefits 218,428.00 218,428.00
Total 55,993,637.27 132,386,128.44 157,236,205.25 31,143,560.46
The ending balance of wages payable decreased 44.38% over that of period-begin, mainly because
the year-end bonus for year of 2014 are paid in the Period.
(2)Short-term salary
Increased Decreased
Items 31-12-2014 during current during current 30-06-2015
period period
1.Wages and salaries, bonuses, allowances
and subsidies 25,570,229.67 87,399,253.66 110,195,220.36 2,774,262.97
2.Staff welfare 25,205,874.20 4,250,497.52 4,780,809.79 24,675,561.93
3.Social insurance 1,698,790.15 6,719,060.58 7,687,421.16 730,429.57
Including： ①Medical insurance 6,012,082.06 6,012,082.06
② Work-related injury
472,923.64 472,923.64
insurance
③Matemity insurance 234,054.88 234,054.88
④Housing subsidies 1,698,790.15 968,360.58 730,429.57
4. Housing funds 2,466,435.12 14,224,102.31 14,295,204.03 2,395,333.40
5.Labor union fund and employee
education fee 1,052,308.13 2,258,753.17 2,743,088.71 567,972.59
6. Non-currency welfare 184,182.00 184,182.00
Total 55,993,637.27 115,035,849.24 139,885,926.05 31,143,560.46
The non-currency welfare of the current year was 184,182.00yuan,which amortization of long-term
expenses of employee’s dormitory use right, and dining hall expenses and etc.
Among the salary, bonus, allowance and subsidies, RMB 4,876,208.00 equity incentive expenses
are included.
(3) Defined contribution plans
Increased during Decreased during
Items 31-12-2014 30-06-2015
current period current period
Basic retirement pension 14,567,686.87 14,567,686.87
Unemployment
insurance 968,087.75 968,087.75
Heating fees 1,596,076.58 1,596,076.58
Total 17,131,851.20 17,131,851.20
The company took part in the government’s basic retirement pension and unemployment insurance
70
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
according to the related legislation, and paid the insurance expenses every month and recorded as
expenses or costs of assets. There was no other obligation of payment.
(4)There was no amount delay paid at the end of the current year.
23. Taxes payable
Items 30-06-2015 31-12-2014
Value-added tax 4,509,550.67 -3,127,955.12
Business tax 2,610,297.16 1,991,177.27
Enterprise income tax 6,413,120.85 2,568,733.67
Individual income tax 1,490,496.69 396,325.29
City maintenance and construction tax 616,937.05 291,424.15
Land use tax 217,274.89 217,274.87
Education surtax 249,018.68 110,082.07
Local education surtax 160,806.41 67,685.90
Water project fund/River route maintenance fee 8,231.90 11,139.52
Safeguard fund for disables 660.00 544.00
Dike maintenance fee 3,941.67 13,509.20
Stamp duty 62,646.59 102,788.87
Non resident enterprise tax 862,500.00
Total 17,205,482.56 2,642,729.69
The reason of the ending balance increased 551.05% compared with the beginning balance was
enterprise income tax payable and value-added tax payable increased.
24. Dividend payable
Name of investors 30-06-2015 31-12-2014 Reasons
Some shareholders not
Legal person shareholders 2,643,678.92 533,156.00
claimed.
Total 2,643,678.92 533,156.00
The reason of the ending balance increased 395.85% compared with the beginning balance was
dividends unpaid.
25. Other accounts payable
(1) Details
Items 30-06-2015 31-12-2014
Loan from non-financial institutes 24,487,500.00 18,096,524.00
Cash pledge and security deposit 14,371,908.67 13,721,523.03
Apply for reimbursement and unpaid 16,298,266.10 14,117,136.22
Cash from related parties 504,856.34 510,097.66
Receipts under custody 666,024.51 11,164,903.53
Others 3,184,161.83 2,465,629.60
Total 59,512,717.45 60,075,814.04
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(2) Major amount aging over 1 year
Name of investors 30-06-2015 Unpaid reason
Subsidiary company borrowed for removal and
Dalian Bingshan Group Co., Ltd. 10,000,000.00
reconstruction
Total 10,000,000.00
26. Deferred revenue
Increased
Decreased during
Items 31-12-2014 during current 30-06-2015 Reasons
current period
period
Associated with assets 51,077,394.00 849,549.00 50,227,845.00
Associated with earnings 1,696,490.19 1,696,490.19
Total 52,773,884.19 2,546,039.19 50,227,845.00 --
Subsidy from government
Increase Converted to
d during non-business Other
Liabilities 31-12-2014 30-06-2015 Notes
current incomes during decrease
period current period
Subsidy fund for Associated
highly effective
heat pump and 4,289,394.00 292,549.00 3,996,845.00 with the
related system asset
Contribution to Associated
subsidiary
company 46,788,000.00 557,000.00 46,231,000.00 with the
relocation asset
Big capacity of Associated
sea water
pre-freeze project 1,696,490.19 1,696,490.19 with the
of Project 863 income
Total 52,773,884.19 2,546,039.19 50,227,845.00
27. Share capitals
Shares
Issuance of converted
Items 31-12-2014 Others 30-06-2015
new shares from
reserve
I. Non-circulating share capital
19,224,451 +10,150,000 29,374,451
with restricted trade conditions
1. State-owned shares
2. Shares held by domestic legal
19,213,921 19,213,921
persons
3. Other domestic shares 10,530 +10,150,000 10,160,530
Including: Shares held by
10,530 +10,150,000 10,160,530
domestic natural person
II. Circulating share capital 330,790,524 330,790,524
1. Domestically listed ordinary
215,793,449 215,790,524
shares (A-share)
2. Domestically listed ordinary
115,000,000 115,000,000
shares (B-share)
III. Total 350,014,975 +10,150,000 360,164,975
As for the resolution of the 15th meeting of the 6th session of the Board, March 4th 2015 was determined as the
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
grant date, award the 41 equity incentive objects with restricted shares amounting to 10,150,000 shares.
28. Capital surpluses
Increased during current Decreased during current
Items 31-12-2014 30-06-2015
period period
Capital premium 515,188,976.98 46,284,000.00 561,472,976.98
Other capital
67,099,029.31 4,876,208.00 71,975,237.31
surplus
Total 582,288,006.29 51,160,208.00 633,448,214.29
The share premium increased in the Period, refers to the share premium recognized by orientate
offer for equity incentive objects, other capital reserves refers to the equity incentive expenses.
29. Other comprehensive income
2015.01-06
After-tax
Items 31-12-2014 Amount for the 30-06-2015
Less：income attribute to
period before * **
tax the parent
income tax
company
I.Later can’t
reclassified into
profit and loss of
other
comprehensive
income
II. Later reclassified
into profit and loss
of other 2,768,286.72 1,003,497,159.30 150,524,573.90 852,972,585.40 855,740,872.12
comprehensive
income
1. Later reclassified
into profit and loss of
other comprehensive
income of long term 2,768,286.72 2,768,286.72
investments
accounting by equity
method
2. Changes in fair
value recognized in
gains and losses of 1,003,497,159.30 150,524,573.90 852,972,585.41 852,972,585.40
the available-for-sale
financial assets
3. Foreign currency
translation
differences of
financial statements
Total 2,768,286.72 1,003,497,159.30 150,524,573.90 852,972,585.40 855,740,872.12
*Less：Previously recognized in profit or loss in other comprehensive income
**After-tax attribute to minority shareholder
Other comprehensive income recognized in the Period refers to the shares of Guotai Junan, held by
the Company are measured by fair value.
30. Surplus reserves
Increased during Decreased during
Items 31-12-2014 30-06-2015
current period current period
Statutory surplus reserves 272,675,444.95 272,675,444.95
Other reserved capital 273,112,803.04 22,378,995.91 295,491,798.95
Total 545,788,247.99 22,378,995.91 568,167,243.90
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
The increase of the surplus reserves were because the other reserved capital
RMB22.379-million-yuan was withdrawn on the basis of 20% of the company’s net profit of 2014
according to the resolution of the General Meeting of Shareholders of year 2014.
31. Retained earnings
Items 2015 Extraction or allocation proportion
Retained earnings at the end of prior year 486,167,740.13
Add: Changes in accounting policies
At beginning of the year after retrospective adjustment 486,167,740.13
Add: Net profit of the current period 65,477,775.99
Less: Appropriation of statutory surplus reserves
Appropriation of other reserved capital 22,378,995.91 20% of net profit of year 2014
Appropriation of employee’s welfare and bonus fund
in foreign invested company 999,777.67
Cash dividends 54,024,746.25 RMB 0.15 per share of year 2014
Dividends transferred to share capital
Retained earnings at the end of the current period 474,241,996.29
32. Total operating income and operating cost
(1) Total operating income and cost
2015.01-06 2014.01-06
Items
Income Cost Income Cost
Key business 703,214,354.35 556,138,449.36 762,976,180.18 598,638,940.68
Other business 8,525,987.78 6,208,948.56 11,936,073.01 11,311,500.14
Total 711,740,342.13 562,347,397.92 774,912,253.19 609,950,440.82
33. Taxes and surcharges
Items 2015.01-06 2014.01-06
Business tax 1,465,636.16 836,183.52
City maintenance and construction tax 2,284,878.37 3,211,160.39
Education surtax 985,263.05 1,377,841.69
Local education surtax 655,805.10 918,538.25
Dike maintenance fee 75,277.68 125,694.96
Total 5,466,860.36 6,469,418.81
34. Selling and distribution expenses
Items 2015.01-06 2014.01-06
Handle official business expenses 2,892,181.98 2,479,958.80
Salaries and subsidies 15,972,653.49 25,847,629.40
Depreciation expenses 253,348.11 250,494.54
Transportations expenses 4,077,525.44 6,609,873.54
Entertainment expenses 2,404,142.35 3,170,406.48
Traveling expenses 7,215,386.47 6,261,527.19
Maintenance and repair expenses 1,429,195.03 3,040,090.24
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Advertisement and bids expenses 554,869.98 804,797.22
Others 528,017.73 436,623.10
Total 35,327,320.58 48,901,400.51
35. Administrative expenses
Items 2015.01-06 2014.01-06
Handle official business expenses 6,415,197.31 6,261,525.85
Salaries and subsidies 50,794,074.60 51,370,661.40
Depreciation expenses 3,515,372.56 3,573,094.77
Transportations expenses 507,034.43 745,869.70
Entertainment expenses 1,292,750.44 2,230,602.65
Traveling expenses 1,811,111.96 1,987,252.27
Maintenance and repair expenses 2,345,494.31 2,988,658.33
Advertisement expenses 95,386.88 430,705.79
Other taxes and fees 4,303,683.83 4,232,710.57
Insurance expenses 1,880,493.01 1,586,520.05
Research and development expenses 10,335,005.70 8,959,019.18
Amortization of long term assets 2,243,366.80 2,166,811.00
Design consultant and test service expenses 2,511,459.14 2,723,594.26
Others 686,672.43 505,756.54
Total 88,737,103.40 89,762,782.36
36. Financial expenses
Items 2015.01-06 2014.01-06
Interest expenses 2,531,600.00 1,578,018.01
Less:Interest income 5,005,928.14 5,861,187.92
Losses on exchange(Less: Gain on exchange) 260,322.22 106,537.45
Other expenses 382,682.47 378,947.63
Total -1,831,323.45 -3,797,684.83
The financial expenses increased 51.78% over that of last period, mainly because the loan interest
increased and basis of deposit decreased in the Period, then the interest income declined.
37. Impairment losses
Items 2015.01-06 2014.01-06
Provision for bad debts 2,475,284.97 11,727,606.97
Provision for obsolete inventories
Provision for the impairment of available-for-sale financial assets
Provision for the impairment of held to maturity investments
Provision for the impairment of long-term equity investments
Provision for the impairment of investing property
Provision for the impairment of fixed assets
Provision for the impairment of construction materials
Provision for the impairment of construction in progress
Provision for the impairment of bearer biological assets
Provision for the impairment of oil assets
Provision for the impairment of intangible assets
Provision for the impairment of goodwill
Provision for the impairment of other assets
Total 2,475,284.97 11,727,606.97
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
The loss from assets devaluation decreased 78.89% over that of last period, mainly because the
accrual bad debt losses decreased in the Period
38. Gain/ (loss) from investment
(1) Details
Items 2015.01-06 2014.01-06
Calculated by equity method 48,083,081.52 53,897,497.58
Calculated by cost method
Gain from disposal associated company 681,816.41
Gain from holding of financial assets available for sale 310,000.00 1,754,944.75
Gain from disposal financial assets available for sale
Total 48,393,081.52 56,334,258.74
(2) There was no severe constrict on the collection of the investment earnings.
39. Non-business incomes
(1)Details
The amount recorded in
Items 2015.01-06 2014.01-06 non-recurring gains and losses of
current period
Gain on the disposal of non-current
28,868.06 2,044.63 28,868.06
assets
Penalty and fine income 43,208.00 122,360.26 43,208.00
Subsidy fund from government 56,012.50 638,030.76 56,012.50
Deferred income 2,546,039.19 4,284,535.75 1,696,490.19
Debts need not paid 88,269.78 88,269.78
Others 6,114.54 3,023.77 6,114.54
Total 2,768,512.07 5,049,995.17 1,918,963.07
(2) Subsidy fund from government
Items 2015.01-06 2014.01-06 Explanations
Subsidy for information construction from Dalian
Municipal Bureau of Finance
Aid for patent from Dalian Intellectual Property
Service Centre
Subsidy of economic support policy 43,400.00 76,300.00 Related to gain
Subsidy for social security 11,165.00 Related to gain
Subsidy for circular economy project
Award for QC team
Aid for patent from Wuhan Intellectual Property
Bureau
Subsidy and award for patent
Mayor’s Quality Award
Financial incentive award for increasing production
and sales
Subsidy for science and technology development
Subsidy for small and medium-sized enterprises
exploiting international market
Financial award for export
Taxes given back 1,447.50 561,730.76 Related to gain
International market developing fund for small and
mid size enterprises
76
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Items 2015.01-06 2014.01-06 Explanations
Subsidy for the first set of important technology
equipment
Reward for promoting increase of industry of year
2014
Subsidy for patent from Wuhan Intellectual Property
Bureau
Subsidy for disposal of useless vehicles
Total 56,012.50 638,030.76 --
The non-operation revenue decreased 45.18% over that of last period, mainly due to the declined of
deferred income in the Period.
40. Non-business expenses
The amount recorded in
Items 2015.01-06 2014.01-06 non-recurring gains and losses of
current period
Loss on the disposal of non-current assets 2,394.33 129,041.96 2,394.33
Fines and penalties 2,071.37 11,514.40 2,071.37
Others 66,263.76
Total 4,465.70 206,820.12 4,465.70
The non-operation expenditure decreased 97.84% over that of last period, mainly because the losses
from fixed assets disposal decreased in the Period.
41. Income tax expenses
(1) Details:
Items 2015.01-06 2014.01-06
Current income tax expense 7,360,497.09 5,937,957.94
Deferred income tax expense -1,668,851.78 -2,186,324.08
Total 5,691,645.31 3,751,633.86
(2) Adjustment process of accounting profit and income tax expense
Items 2015.01-06
Total profits 70,374,826.24
Current income tax expense accounted by tax and relevant
10,556,223.94
regulations
Influence of different tax rate suitable to subsidiary 4,151,259.99
Influence of income tax before adjustment -817,872.20
Influence of non taxable income -7,807,535.63
Influence of not deductable costs, expenses and losses 163,878.83
Influence of deductable losses of deferred income tax assets
650,087.58
derecognized used in previous period
Influence of deductible temporary difference or deductible losses
-1,204,397.20
of deferred income tax assets derecognized in reporting period.
Income tax expenses 5,691,645.31
The income tax expenses increased 51.71% over that of last period, mainly because the taxable
income tax from the subsidiaries increased.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
42. Relevant information about cash flow statement
(1) Other cash received relating to operating activities
Items 2015.01-06 2014.01-06
Government grants 54,565.00 76,300.00
Received travel expense receivable 1,014,539.73
Deposit received 5,113,665.00 14,137,606.36
Received amount paid on behalf of related companies 644,271.81 3,665,453.62
interest income 7,513,302.20 4,279,561.80
Others 772,394.36 1,621,146.19
Total 15,112,738.10 23,780,067.97
(2) Other cash paid relating to operating activities
Items 2015.01-06 2014.01-06
Borrowing of travel expense 4,880,283.65 7,920,321.99
Deposit paid 4,360,672.45 3,911,850.00
Expenditure 45,836,364.92 39,706,895.07
Bank handling charges 382,682.47 338,963.63
Others 11,055,701.02 708,368.10
Total 66,515,704.51 52,586,398.79
(3) Cash receipts related to other financing activities
Items 2015.01-06 2014.01-06
Guarantee money took back 32,953,876.63
Total 32,953,876.63
(4) Other cash paid relating to financing activities
Items 2015.01-06 2014.01-06
Interests on discount of bill acceptance 39,984.00
Guarantee money paid 34,920,526.90
Total 34,920,526.90 39,984.00
43. Complementary information for consolidated cash flow statement
(1) The relationship between the net profit and the net cash flows from operating activities
Items 2015.01-06 2014.01-06
1. Reconciliation from the net profit to the cash flows from operating
activities
Net profit 64,683,180.93 69,324,088.48
Add: Provisions for assets impairment 2,475,284.97 11,727,606.97
Depreciation of fixed assets 18,524,223.20 18,243,165.48
Amortization of intangible assets 2,180,457.64 2,103,901.84
Amortization of long-term deferred expenses 739,252.02 358,885.66
Losses on disposal of fixed assets, intangible assets and other long-term
-28,868.06 -611,114.76
assets
Losses on scrapping of fixed assets 2,394.33 56,295.68
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Losses on variation of fair value
Finance expenses 2,486,829.17 1,684,555.46
Investment losses -48,393,081.52 -55,652,442.33
Decrease in deferred tax assets -1,668,851.78 -2,184,574.08
Increase in deferred tax liabilities
Decrease in inventory 22,423,162.65 54,052,680.59
Decrease in operating receivables -106,331,110.05 -126,192,171.87
Increase in operating payables -87,682,794.87 24,494,736.42
Others
Net cash flows from operating activities -130,589,921.37 -2,594,386.46
2. Investing and financing activities that do not involve cash receipts and
payments
Conversion of debt into capital
Convertible bonds to be expired within one year
Fixed assets under finance lease
3. Net increase in cash and cash equivalents
Cash at the end of the period 330,091,246.94 469,921,233.07
Less: Cash at the beginning of the period 475,557,589.39 502,339,160.35
Plus: Cash equivalents at the end of the period
Less: Cash equivalents at the beginning of the period
Net increase in cash and cash equivalents -145,466,342.45 -32,417,927.28
(2) Cash and cash equivalents
Items 2015.01-06 2014.01-06
1.Cash 330,091,246.94 475,557,589.39
Including: cash on hand 61,557.65 67,783.07
Bank deposits that can be used for payment whenever necessary 330,029,689.29 457,395,413.41
Other monetary capital that can be used for payment whenever
18,094,392.91
necessary
2.Cash equivalents
Including: Bonds mature within 3 months
3.Balance of cash and cash equivalents at the end of the current period 330,091,246.94 475,557,589.39
Including: Cash or cash equivalents which was restricted in use of the
Company and subsidiaries in the group
44. The assets with the ownership or use right restricted
Items 30-06-2015 Reasons
Monetary fund 34,920,526.90 Guarantee money
Fixed assets 118,281,897.89 Subsidiaries’ assets mortgaged for loans
Intangible assets 54,505,684.00 Subsidiaries’ assets mortgaged for loans
Total 207,708,108.79
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
45. Foreign currency monetary items
Ending balance of Original Ending balance of RMB
Items Exchange rate
currency equivalent
Monetary fund
Included: USD 13,153.06 6.1136 80,412.55
EUR 5.60 6.8699 38.47
JPY 311,671.00 0.050052 15,599.76
GBP 116,927.58 9.6422 1,127,439.11
Accounts receivable
Included: GBP 188,090.65 9.6422 1,813,607.67
Accounts payable
Included: GBP 36,399.28 9.6422 350,969.14
VIII. Changes of consolidation scope
By the solution of the 12th meeting of 6th session of Board of Directors of the company, the
company established a joint company with Dalian Bingshan International Trade Co., Ltd. The new
company named Bingshan Technology Service (Dalian) Co., Ltd., and the registered capital was
RMB 20,000,000.00. As at 31st December 2014, Bingshan Technology Service (Dalian) Co., Ltd.
got the business license, but not received the capital and not started to operate and not included in
the company’s consolidated statements. Till end of 30 June 2015, Bingshan Technology Service
(Dalian) Co., Ltd. started operations, and was included in the consolidated statement of the
Company.
IX. Equity in other entities
1. Equity in subsidiary
(1) The structure of the enterprise group
Main Shareholding
Registered Business (%) Obtaining
Name of subsidiaries business
address nature method
address Direct Indirect
Dalian Bingshan Group Refrigeration
Installation Co., Ltd. (“Installation Dalian Dalian Installation 100 Establish
Company”)
Dalian Bingshan Group Sales Co.,
Dalian Dalian Trading 100 Establish
Ltd. (“Sales Company”)
Dalian Bingshan Air-Conditioning
Equipment Co., Ltd. (“Bingshan Dalian Dalian Manufacturing 70 Establish
Air-Conditioning”)
Dalian Bingshan Metal Processing
Dalian Dalian Manufacturing 100 Establish
Co., Ltd. (“Metal Processing”)
Dalian Bingshan Guardian
Dalian Dalian Manufacturing 60 Establish
Automation Co., Ltd.
Dalian Bingshan Ryosetsu Quick
Dalian Dalian Manufacturing 70 Establish
Freezing Equipment Co., Ltd.
Wuhan New World Refrigeration
Wuhan Wuhan Manufacturing 51 Purchase
Industrial Co., Ltd. (“WNWRI”)
Bingshan technical service (dalian)
Dalian Dalian Services 60 Establish
Co., Ltd.
Wuhan New World Refrigeration Air Installation
Wuhan Wuhan 5 95 Establish
Conditioner Engineering Co., Ltd.
Ningbo Bingshan Refrigeration Air
Ningbo Ningbo Installation 51 Establish
Conditioner Engineering Co., Ltd.
①All the holding proportion in subsidiaries were the same with voting proportion；
80
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
②The company held over 50% voting proportion in subsidiaries；
③ The company could control these subsidiaries；
④By the solution of the 12th meeting of 6th session of Board of Directors of the company , the
company established a joint company with Dalian Bingshan International Trade Co., Ltd. The new
company named Bingshan Technology Service (Dalian) Co., Ltd., and the registered capital was
RMB 20,000,000.00. The company will invest RMB 12,000,000.00 and hold 60% of shareholding
proportion. As at 31st December 2014, Bingshan Technology Service (Dalian) Co., Ltd. got the
business license, but not received the capital and not started to operate and not included in the
company’s consolidated statements. Till end of 30 June 2015, Bingshan Technology Service (Dalian)
Co., Ltd. started operations, and was included in the consolidated statement.
(2) Important Non-wholly-owned Subsidiary
Accumulative
Profit\loss Current pay
Shareholding of equity of
attributable to dividends to
Name of subsidiaries minority minority Notes
minority minority
shareholders(%) shareholders
shareholders shareholders
30-06-2015
Wuhan New World Refrigeration
49 -3,076,345.70 56,750,416.92
Industrial Co., Ltd.
(3) The main financial information of subsidiaries ten thousand yuan
30-06-2015
Name of subsidiaries Current No-current Current No-current Total
Total assets
assets assets liabilities liabilities liabilities
Wuhan New World Refrigeration
25,059.86 20,631.58 45,691.44 28,029.25 4,623.10 32,652.35
Industrial Co., Ltd.
Continued:
31-12-2014
Name of subsidiaries Current No-current Current No-current Total
Total assets
assets assets liabilities liabilities liabilities
Wuhan New World Refrigeration
24,968.78 20,184.66 45,153.44 26,886.27 4,678.80 31,565.07
Industrial Co., Ltd.
Continued:
2015.01-06 2014.01-06
Cash Cash
Name of The total The total
Total flows Total flows
subsidiaries Operating amount of Operating amount of
comprehensiv from comprehensiv from
income comprehensive income comprehensive
e income operating e income operating
income income
activities activities
Wuhan New
World
Refrigeration 10,366.39 -549.28 -549.28 -549.27 15,965.69 312.51 312.51 2,540.51
Industrial
Co., Ltd.
2. The transaction of the company with its owner’s equity share changed but still controlling
the subsidiary
(1) Note to owner’s equity share changed in subsidiaries
By the solution of the 11th meeting of 6th session of Board of Directors of the company , the
company purchased 10% shareholdings of Dalian Bingshan Group Sales Co., Ltd., and Dalian
Bingshan Group Sales Co., Ltd. became a whole holding subsidiary of the company. The company
would transfer 30% shareholdings of Dalian Bingshan Group Sales Co., Ltd. to Wuhan New World
Refrigeration Industrial Co., Ltd., but the equity transaction did not finish until the date June 30,
81
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2015, and the company held 100% shareholdings of Dalian Bingshan Group Sales Co., Ltd. in the
financial statements of first half of 2015.
By the solution of the 12th meeting of 6th session of Board of Directors of the company, the
company would purchase the subsidiary Dalian Bingshan Metal Processing Co., Ltd., and the equity
transaction finished until the date June 30, 2015, so the company held 100% shareholdings of
Dalian Bingshan Metal Processing Co., Ltd. in the financial statements of first half of 2015.
(2) The transaction’s influence to equity of minority shareholders and attributable to the owner's
equity of the parent company
Items Dalian Bingshan Metal Processing Co., Ltd.
Cash 9,249,900.00
Total Purchase cost 9,249,900.00
Less：Net assets calculated by the proportion of shareholding
9,249,900.00
of the transaction
Difference -
th th
Being approved by the 12 meeting of the 6 session of the Board, the 35.75% equity of original
controlling subsidiary-Dalian Bingshan Metal Process Co., Ltd. are transferred by the Company,
based on the pricing standards-the book value of the owner’s equity attributable to parent company
ended as 31 August 2014 under the name of Dalian Bingshan Metal Process Co., Ltd., the
transferring price was RMB 9,249,900.00.
3. Equity in joint venture arrangement or associated enterprise
(1)The important of joint ventures or affiliated companies
Main Register Shareholding
Name of joint ventures or affiliated Accountin
business ed Business nature Indire
companies Direct g methods
address address ct
Joint ventures:
Dalian Bingshan – P&A Recreation Equity
Dalian Dalian Installation 50%
Development Engineering Co., Ltd method
Affiliated companies:
Keinin-Grand Ocean Thermal Technology Equity
Dalian Dalian Manufacturing 20%
(Dalian) Co., Ltd method
Equity
Panasonic Compressor (Dalian) Co., Ltd Dalian Dalian Manufacturing 40%
method
Dalian Fuji Bingshan Vending Machine Co., Equity
Dalian Dalian Manufacturing 49%
Ltd. method
(2)The main financial information of joint ventures
Items 30-06-2015/2015.01-06 31-12-2014/2014.01-06
Current assets 9,634,599.72 11,558,920.00
Including: Cash and cash equivalents 1,252,965.34 2,892,025.92
Non-current assets 461,003.24 213,621.85
Assets total 10,095,602.96 11,772,541.85
Current liabilities 3,733,184.38 4,616,122.53
Non-current liabilities
Total liabilities 3,733,184.38 4,616,122.53
Minority interests
Equity to the parent company 6,362,418.58 7,156,419.32
82
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Items 30-06-2015/2015.01-06 31-12-2014/2014.01-06
Net assets calculated according to the
shareholding proportions 3,181,209.29 3,578,209.66
Adjusting events
—Goodwill
—Unrealized profits of insider trading
—Employee’s welfare and bonus fund in foreign
-4,439.67 -24,289.69
invested company
Book value of equity investment of joint ventures 3,176,769.62 3,553,919.97
Fair value of equity investment with public offer
Operating income 703,985.12 7,446,769.63
Finance expenses -535.21 -246.95
Income tax 159,398.86
Net profit -794,000.74 478,196.58
Other comprehensive income
Total comprehensive income -794,000.74 478,196.58
The dividends received from joint ventures during
current year
(3) The main financial information of affiliated companies
30-06-2015/2015.01-06
Items Keinin-Grand Ocean Dalian Fuji Bingshan
Panasonic Compressor
Thermal Technology Vending Machine Co.,
(Dalian) Co., Ltd
(Dalian) Co., Ltd Ltd.
Current assets 262,994,046.16 1,476,278,713.90 290,926,516.52
Non-current assets 102,621,777.49 356,719,720.58 62,565,731.09
Total assets 365,615,823.65 1,832,998,434.48 353,492,247.61
Current liabilities 163,882,289.72 756,705,748.73 141,363,866.25
Non-current liabilities 3,336,569.64
Total liabilities 163,882,289.72 756,705,748.73 144,700,435.89
Minority interests
Equity to the parent company 201,733,533.93 1,076,292,685.75 208,791,811.72
Net assets calculated according to the
40,346,707.17 430,517,074.30 102,307,987.74
shareholding proportions
Adjusting events
—Goodwill
—Unrealized profits of insider
tradings
—Employee’s welfare and bonus fund
-2,560,165.44
in foreign invested company
Book value of equity investment of
40,346,707.17 427,956,908.86 102,307,987.74
affiliated companies
Fair value of equity investment with
public offer
Operating income 334,917,403.41 985,412,375.73 209,861,461.28
Net profit 38,063,823.88 80,005,169.74 25,328,865.57
Net profit of discontinuing operation
Other comprehensive income
83
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
30-06-2015/2015.01-06
Items Keinin-Grand Ocean Dalian Fuji Bingshan
Panasonic Compressor
Thermal Technology Vending Machine Co.,
(Dalian) Co., Ltd
(Dalian) Co., Ltd Ltd.
Total comprehensive income 38,063,823.88 80,005,169.74 25,328,865.57
The current dividends received from
9,600,000.00
joint ventures
Continued：
31-12-2014/2014.01-06
Items Keinin-Grand Ocean Dalian Fuji Bingshan
Panasonic Compressor
Thermal Technology Vending Machine Co.,
(Dalian) Co., Ltd
(Dalian) Co., Ltd Ltd.
Current assets 229,755,347.05 1,533,547,513.54 201,931,675.02
Non-current assets 109,589,146.12 358,157,107.39 62,589,896.32
Total assets 339,344,493.17 1,891,704,620.93 264,521,571.34
Current liabilities 127,674,781.29 796,714,218.88 77,636,760.15
Non-current liabilities 3,421,865.04
Total liabilities 127,674,781.29 796,714,218.88 81,058,625.19
Minority interests
Equity to the parent company 211,669,711.88 1,094,990,402.05 183,462,946.15
Net assets calculated according to the
42,333,942.39 437,996,160.82 89,896,843.61
shareholding proportions
Adjusting events
—Goodwill
—Unrealized profits of insider
tradings
—Employee’s welfare and bonus fund
-5,481,154.41
in foreign invested company
Book value of equity investment of
42,333,942.39 432,515,006.40 89,896,843.61
affiliated companies
Fair value of equity investment with
public offer
Operating income 286,306,907.58 1,255,325,747.10 194,187,243.81
Net profit 20,800,431.70 92,039,692.56 20,008,126.71
Net profit of discontinuing operation
Other comprehensive income
Total comprehensive income 20,800,431.70 92,039,692.56 20,008,126.71
The current dividends received from
8,800,000.00
joint ventures
(4) Summary financial information of insignificant affiliated companies
Items 30-06-2015/2015.01-06 31-12-2014/2014.01-06
Total book value of investment of
459,725,585.61 470,930,026.48
affiliated companies
The total of following items according to
-- --
the shareholding proportions
Net profit -964,253.70 19,944,975.85
Other comprehensive income
Total comprehensive income -964,253.70 19,944,975.85
84
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
(5) No significant restrictions of the ability of joint venture or associated enterprise transfer funds
to the company.
(6)No excess loss of joint venture or associated enterprise.
(7)No commitment related to joint venture or affiliated company needed disclose.
(8)No Contingent liabilities related to joint venture or affiliated company needed disclose.
X. The risk related financial instruments
The Company faces a variety of financial risks in the course of operation: credit risk, liquidity risk
and market risk (mainly exchange risk and interest rate risk). The objective of the company‘s risk
management is to obtain a proper balance between the risks and benefits, reduce the risks‘ negative
impact on the company's operating performance.
1. Credit risk
The credit risk of the company included monetary fund, accounts receivable, notes receivable and
other accounts receivable etc. The management made credit policies and supervised changes of
these credit explosure.
The company's working capital was in bank with higher credit rating, so there was no significant
credit risk, nor significant losses due to the default of other entity.
Company mainly faces customer credit risk caused by the credit sale. The Company would make an
evaluation on new customers‘ credit risk before signing new contracts, which includes external
credit rating and bank reference letter (when available) under certain circumstances. The Company
sets quota on credit sale for each customer and such quota is the maximum amount without
additional approvals. As at June 30, 2015, the big five customers of accounts receivable was 11.69%
of total accounts receivable, and as at 31st December 2014 that was 10.86%.
Except guarantee events disclosed in the notes, there was no other credit risk of guarantee of the
company.
2. Liquidity risk
Liquidity risk was referred to the risk of shortage of funds incurred when the enterprise perform the
obligation of settlement by cash or other financial assets.
The financial department of the company continued to monitors the short term or long term capital
needs to ensure maintain plenty of cash flow. And the same time they also monitor the condition of
bank loan agreements and obtain commitments from banks to provide plenty of fund.
As at June 30, 2015, the company’s financial assets and financial liabilities in line with non discount
cash flow of the contracts as following：
30-06-2015
Items Original value of 1-2 2-5
Book value Within 1 year Over 5 years
the book years years
Monetary fund 365,011,773.84 365,011,773.84 365,011,773.84
Notes receivable 48,780,136.31 48,780,136.31 48,780,136.31
Accounts
566,710,020.31 680,938,857.71 566,710,020.31
receivable
Interest
2,491,608.34 2,491,608.34 2,491,608.34
receivable
Dividends
39,200,000.00 39,200,000.00 39,200,000.00
receivable
Other
40,188,760.41 45,706,963.73 40,188,760.41
receivables
Available for
sale financial 1,045,925,548.00 1,051,150,318.80 1,045,925,548.00
assets
Subtotal 2,108,307,847.21 2,233,279,658.73 1,062,382,299.21 1,045,925,548.00
Short-term
60,000,000.00 60,000,000.00 60,000,000.00
borrowings
Notes payable 120,832,581.67 120,832,581.67 120,832,581.67
Accounts
545,355,348.00 545,355,348.00 545,355,348.00
payable
85
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
30-06-2015
Items Original value of 1-2 2-5
Book value Within 1 year Over 5 years
the book years years
Employees’
compensation 31,143,560.46 31,143,560.46 31,143,560.46
payable
Taxes payable 17,205,482.56 17,205,482.56 17,205,482.56
Dividend
2,643,678.92 2,643,678.92 2,643,678.92
payable
Other payables 59,512,717.45 59,512,717.45 59,512,717.45
Subtotal 836,693,369.06 836,693,369.06 836,693,369.06
Continued:
31-12-2014
Items Original value of 1-2 2-5
Book value Within 1 year Over 5 years
the book years years
Monetary fund 508,511,466.02 508,511,466.02 508,511,466.02
Notes receivable 14,855,957.70 14,855,957.70 14,855,957.70
Accounts
438,880,830.12 555,119,550.49 438,880,830.12
receivable
Interest receivable 4,998,982.40 4,998,982.40 4,998,982.40
Other receivables 34,266,444.02 39,244,121.02 34,266,444.02
Available for sale
42,428,388.70 47,653,159.50 42,428,388.70
financial assets
Subtotal 1,043,942,068.96 1,170,383,237.13 1,001,513,680.26 42,428,388.70
Short-term
60,000,000.00 60,000,000.00 60,000,000.00
borrowings
Notes payable 109,546,502.61 109,546,502.61 109,546,502.61
Accounts payable 511,076,537.82 511,076,537.82 511,076,537.82
Employees’
compensation 55,993,637.27 55,993,637.27 55,993,637.27
payable
Taxes payable 2,642,729.69 2,642,729.69 2,642,729.69
Dividend payable 533,156.00 533,156.00 533,156.00
Other payables 60,075,814.04 60,075,814.04 60,075,814.04
Subtotal 799,868,377.43 799,868,377.43 799,868,377.43
3. Market risk
(1) Exchange rate risk
Most of the company’s business located in China, and settled with RMB. But the company
defined exchange rate risk of foreign currency assets and future foreign currency transaction
(mainly including USD,JPY,HKD and GBP). The financial department of the company monitors
the company’s foreign currency transaction and the scale of foreign assets and liabilities, and
decreases exchange rate risk.
①During the current year the company didn’t buy any forward foreign exchange contract or swap
contract.
② As at June 30,2015, the company’s foreign currency assets and foreign currency liabilities listed
in RMB as following：
86
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
30-06-2015
Items
USD JPY GBP EUR Total
Foreign currency
financial assets,
Monetary fund 80,412.55 15,599.76 1,127,439.11 38.47 1,223,489.89
accounts
1,813,607.67 1,813,607.67
receivable
Subtotal 80,412.55 15,599.76 2,941,046.78 38.47 3,037,097.56
Foreign currency
financial liability
Accounts payable 350,969.14 350,969.14
Subtotal 350,969.14 350,969.14
Continued:
31-12-2014
Items
USD JPY GBP EUR Total
Foreign currency
financial assets,
Monetary fund 91,285.75 8,353.65 2,283,436.54 41.75 2,383,117.69
accounts
2,578,861.20 2,578,861.20
receivable
Subtotal 91,285.75 8,353.65 4,862,297.74 41.75 4,961,978.89
Foreign currency
financial liability
Accounts payable 347,383.81 347,383.81
Subtotal 347,383.81 347,383.81
③ The sensitive analysis：
As at June 30, 2015, because the company’s foreign currency assets or liabilities were small, the
change of foreign exchange rate had little impact to the company’s net profit or shareholders' equity.
(2) Interest rate risk
The interest risk of the Group incurred from bank loan, interest rate risk of a floating interest rate of
financial liabilities that lead to the company facing cash flow interest rate risk, financial liabilities
with a fixed interest rate lead to the company facing cash flow interest rate risk. The company
determined the proportion of fixed interest rate and floating interest rate according the current
market circumstance. As at 1st December 2014, the subsidiary of the company Wuhan New World
Refrigeration Industrial Co., Ltd. borrowed short term loan RMB 60,000,000.00 with fixed interest
rate.
The financial department of the company continuously monitors the interest rates level, and the
management would make some adjustment to face interest rate increasing.
The sensitive analysis：
Base on the assumption of interest rate change of 50 BP, the company’s net profit of first half of
2015 will increase or decrease RMB 300,000.
87
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
XI. Related Parties Relationships and Transactions
1. Information of the company’s parent company
Name of Registered Nature of Registered The parent The parent
company's company's
enterprise address business capital shareholding voting right
Dalian
Bingshan Group Dalian Manufacture 140,600,000.00 21.34% 21.34%
Co., Ltd.
(1) Information of the company’s parent company
Dalian Bingshan Group Co., Ltd. Is a sino–foreign joint venture located No.888 Xinan Road,
Shahekou District, Dalian, China. The legal representative person of Dalian Bingshan Group Co.,
Ltd. Is Homma Tetsuro, and the registered capital is RMB140.6 million. The registered business
operation period is from 3rd July 1985 to 2nd July 2035. The business scope include research,
development, manufacture, sales, service and installment of refrigeration product, freezing and
cooling product, different size of air-conditioners, petrochemical equipment, electronic and
electronic control product, home electronic appliance, environment protect equipment and etc.
(Business needed administrative permission must have the administrative license. )
(2) There is no ultimate controller of the Company.
2. The information of the subsidiaries please refers to IX.1 of this note.
3. The information of the affiliated company and joint venture please refers to IX.3 of this
note.
The companies had related party transaction with the company during the current period or had
transaction balance at the end of last period, including:
Names of the joint ventures or affiliated companies Relationships with the Company
Dalian Bingshan – P&A Recreation Development Engineering Co., Ltd Joint venture of the Company
Dalian Bingshan Engineering & Trading Co. , Ltd Affiliated company of the Company
Panasonic Refrigeration (Dalian) Co., Ltd Affiliated company of the Company
Dalian Honjo Chemical Co., Ltd Affiliated company of the Company
Panasonic Cold-chain (Dalian) Co., Ltd Affiliated company of the Company
Keinin-Grand Ocean Thermal Technology (Dalian) Co., Ltd Affiliated company of the Company
Panasonic compressor (Dalian) Co., Ltd Affiliated company of the Company
Dalian Sanyo Meica Electronics Co., Ltd Affiliated company of the Company
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
Affiliated company of the Company
Co., Ltd
Dalian Fuji Bingshan Vending Machine Co., Ltd Affiliated company of the Company
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd Affiliated company of the Company
MHI Bingshan Refrigeration (Dalian) Co., Ltd Affiliated company of the Company
Dalian Fuji Bingshan Vending Machine sales Co., Ltd Affiliated company of the Company
4. Other type of the related parties
Names of the related parties Relationships with the Company
Dalian Bingshan Group Refrigeration Equipment Co., Ltd Subsidiary of Dalian Bingshan Group
Dalian Third Refrigeration Equipment Factory Subsidiary of Dalian Bingshan Group
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd Subsidiary of Dalian Bingshan Group
Dalian Spindle Cooling Towers Co., Ltd Affiliated company of Dalian Bingshan Group
Dalian Bingshan Metal Technology Co., Ltd Affiliated company of Dalian Bingshan Group
88
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Names of the related parties Relationships with the Company
Dalian Mahe Level Control Electrical Appliances Co., Ltd Affiliated company of Dalian Bingshan Group
Linde Engineering (Dalian) Co., Ltd Affiliated company of Dalian Bingshan Group
BAC Dalian Co., Ltd Joint venture of Dalian Bingshan Group
Linde Engineering (Hangzhou) Co., Ltd Affiliated company of Dalian Bingshan Group
5. The transactions between the Company and the related parties
(1) The transactions between the Company and the related parties, whose balance sheet has been
included in the consolidated statement and between the parties themselves have been offset.
(2) Purchases of goods from related parties
Details of
Names of the related parties 2015.01-06 2014.01-06
transaction
Panasonic Refrigeration (Dalian) Co., Ltd. Purchases of goods 716,562.50 884,503.24
Panasonic Cold-chain (Dalian) Co., Ltd. Purchases of goods 3,304,862.95 7,433,527.78
Panasonic Compressor (Dalian) Co., Ltd. Purchases of goods 784,752.13 32,239.21
Dalian Sanyo Meica Electronics Co., Ltd Purchases of goods 100,828.42 195,764.27
Dalian Bingshan Group Refrigeration Equipment
Purchases of goods 6,421,503.17 22,424,166.91
Co., Ltd
Dalian Third Refrigeration Equipment Factory Purchases of goods 4,812,153.85 3,807,851.00
Dalian Spindle Cooling Towers Co., Ltd Purchases of goods 322,813.68 133,333.33
BAC Dalian Co., Ltd Purchases of goods 13,730,297.37 25,317,502.60
Dalian Bingshan Engineering & Trading Co. , Ltd Purchases of goods 25,668,455.04 8,482,546.92
Dalian Bingshan Metal Technology Co., Ltd Purchases of goods 155,961.17 534,598.40
Daliian Sanyo High-Efficient Refrigeration System
Purchases of goods 763,338.56 1,068,325.94
Co., Ltd
Dalian Fuji Bingshan Vending Machine Co., Ltd Purchases of goods 242,187.94
Beijing Huashang Bingshan Refrigeration and
Purchases of goods 1,350,427.36
Air-conditioning Machinery Co., Ltd
Total 58,374,144.14 70,314,359.60
Sales of goods to related parties
Details of
Names of the related parties transaction 2015.01-06 2014.01-06
Panasonic Refrigeration (Dalian) Co., Ltd. Sales of goods 1,781,171.34 4,947,472.34
Panasonic Cold-chain (Dalian) Co., Ltd. Sales of goods 15,006,735.92 10,599,811.03
Panasonic Compressor (Dalian) Co., Ltd. Sales of goods 3,404,239.17 3,637,584.26
Dalian Bingshan Group Refrigeration Equipment Co., Ltd Sales of goods 667,450.61 919,806.39
Dalian Third Refrigeration Equipment Factory Sales of goods 806,213.11 3,179,698.09
BAC Dalian Co., Ltd Sales of goods 1,090,316.25
Dalian Bingshan Engineering & Trading Co. , Ltd Sales of goods 40,431,688.39 51,801,413.84
Dalian Bingshan – P&A Recreation Development Engineering
Sales of goods 6,538.47 84,999.99
Co., Ltd
89
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Details of
Names of the related parties transaction 2015.01-06 2014.01-06
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd Sales of goods 280,132.48 173,671.79
Beijing Huashang Bingshan Serial Refrigeration Equipment Co.,
Sales of goods 20,449,376.92 33,544,521.62
Ltd
Dalian Fuji Bingshan Vending Machine Co., Ltd Sales of goods 5,074,438.78 1,367,412.63
Dalian Bingshan Metal Technology Co., Ltd Sales of goods 51,224.53 69,888.46
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd Sales of goods 401,446.85 255,563.57
MHI Bingshan Refrigeration (Dalian) Co.,Ltd Sales of goods 2,702,016.14 795,707.71
Dalian Spindle Cooling Towers Co., Ltd Sales of goods 194,966.55
Total 91,257,639.26 112,467,867.97
(3) Leasing fee from related party
Rental income of Rental income of
Lessee Leasing assets current period previous period
Dalian Bingshan Group Co., Ltd. Offices
Dalian Bingshan Engineering & Trading
Offices
Co. , Ltd
MHI Bingshan Refrigeration (Dalian)
Workshops 2,100,000.00
Co.,Ltd.
Total 2,100,000.00
Leasing fee to related party
Rental fees of Rental fees of
Leaser Leasing assets current period previous period
Dalian Bingshan Group Co., Ltd. Offices
Total
The Company signed a leasing agreement with Dalian Bingshan Group Co., Ltd., and leased 576
㎡ of offices to Dalian Bingshan Group Co., Ltd. The rental of offices is RMB 103,680.00 per year,
and the effective period of the contract is 2 years.
The Company rent office and garage of Dalian Bingshan Group Co., Ltd., and the rental is
RMB142,572.00 per year for 3 years.
The company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co., Ltd., and rent #
6 workshop building located on No. 106 Liaohe East Rd, Dalian Economic and Technology
Development Zone to MHI Bingshan Refrigeration (Dalian) Co., Ltd. The rental area is 15,259.04
square meters, and rent term till 16th July, 2029. The annual rent fee is RMB 4.2 million considering
the time value of money.
(4) No guarantee with related companies.
(5) The borrowing of funds from related party
Name of the related party Amount Starting date Ending date Explanation
Dalian Bingshan Group Co., Borrowed for moving to new
10,000,000.00 2006.09.01
Ltd. location
Dalian Bingshan Group Co., Borrowed for building new
10,000,000.00 2015.02.16
Ltd. building
Total 20,000,000.00
The Company’s subsidiary Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd.
90
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
borrowed RMB 10,000,000.00 from Dalian Bingshan Group Co., Ltd. for moving to new location,
and the interests are counted same as bank loan.
The Company’s subsidiary Wuhan New World Refrigeration Industry Co., Ltd. borrowed RMB
10,000,000.00 from Dalian Bingshan Group Co., Ltd. for building new location, and the interests
are counted same as bank loan.
(6)Related party asset transfer and debt restructuring
Not applicable.
6. Amounts due from/to related parties
(1) Accounts receivable
30-06-2015 31-12-2014
Names of the related parties Provision Provision
Amount for bad Amount for bad
debts debts
Panasonic Compressor (Dalian) Co., Ltd. 1,216,391.58 63,569.58 91,852.00 7,367.60
Panasonic Refrigeration (Dalian) Co., Ltd. 2,500,731.01 125,036.55 2,735,787.19 136,789.36
Panasonic Cold-chain (Dalian) Co., Ltd. 6,224,616.79 311,230.84 2,082,509.89 109,302.98
Dalian Bingshan Engineering & Trading Co., Ltd. 960,950.07 48,047.50 1,155,043.14 57,752.16
BAC Dalian Co., Ltd. 5,600.00 280.00 5,600.00 280.00
Beijing Bingshan Serial Refrigeration Equipment Co.,
380,455.52 19,022.78 378,597.55 18,929.88
Ltd.
Dalian Bingshan – P&A Recreation Development
65,180.00 3,259.00 215,180.00 10,759.00
Engineering Ltd.
Beijing Huashang Bingshan Refrigeration and
20,978,367.08 1,083,718.35 3,713,359.64 220,467.98
Air-conditioning Machinery Co., Ltd.
Dalian Fuji Bingshan Vending Machine Co., Ltd. 3,568,795.65 178,439.78 318,714.88 15,935.74
Dalian Sanyo High-Efficient Refrigeration System
389,104.32 19,455.22 142,907.59 7,145.38
Co., Ltd.
MHI Bingshan Refrigeration (Dalian) Co., Ltd. 1,007,786.86 50,389.34 461,942.00 23,097.10
Dalian Spindle Cooling Towers Co., Ltd. 127,286.20 6,364.31
(2) Notes receivable
Names of the related parties 30-06-2015 31-12-2014
Panasonic Compressor (Dalian) Co., Ltd 1,868,896.93 1,868,896.93
Dalian Bingshan Engineering & Trading Co., Ltd. 12,130,543.83
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. 223,496.21
Panasonic Cold Chain (Dalian) Co., Ltd 280,507.23 1,875,903.71
Panasonic Refrigeration (Dalian) Co., Ltd 498,649.81 227,535.94
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd 1,200,000.00 2,000,000.00
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
5,000,000.00 5,000,000.00
Co., Ltd
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(3) Accounts paid in advance
Names of the related parties 30-06-2015 31-12-2014
Dalian Third Refrigeration Equipment Factory 317,250.00
Panasonic Compressor (Dalian) Co., Ltd 1,214.00
Panasonic Cold-chain (Dalian) Co., Ltd 510.00
BAC Dalian Co., Ltd 672.00
Dalian Bingshan Engineering & Trading Co., Ltd. 5,963,284.85 2,698,283.12
(4) Other accounts receivable
30-06-2015 31-12-2014
Name of the related party Provision
Provision for bad
Amount Amount for bad
debts
debts
Beijing Huashang Bingshan Refrigeration
34,598.32 1,729.92
and Air-conditioning Machinery Co., Ltd
Panasonic Cold-chain (Dalian) Co., Ltd. 137,520.50 6,876.03
(5) Accounts payable
Names of the related parties 30-06-2015 31-12-2014
Dalian Third Refrigeration Equipment Factory 3,118,623.11 1,507,966.95
BAC Dalian Co., Ltd. 18,393,016.94 21,593,357.00
Dalian Bingshan Group Refrigeration Equipment Co., Ltd. 4,722,049.29 6,536,438.32
Panasonic Refrigeration (Dalian) Co., Ltd. 195,000.00
Panasonic Cold-chain (Dalian) Co., Ltd. 12,531.00 12,531.00
Dalian Sanyo Meica Electronics Co., Ltd. 76,603.41 221,236.85
Dalian Spindle Cooling Towers Co., Ltd. 391,999.00 269,499.00
Dalian Bingshan Engineering & Trading Co., Ltd. 9,750,412.34 2,849,467.19
Panasonic Compressor (Dalian) Co., Ltd. 159,210.00 25.50
Dalian Bingshan Metal Technology Co., Ltd. 134,381.61 251,907.04
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. 1,185,745.90 792,639.78
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd. 67,008.00
(6) Notes payable
Names of the related parties 30-06-2015 31-12-2014
Dalian Bingshan Group Co., Ltd. 760,794.55
Dalian Bingshan Group Refrigeration Equipment Co., Ltd. 4,000,000.00 8,000,000.00
BAC Dalian Co., Ltd. 145,432.00 700,000.00
Dalian Bingshan Group Materials Trading Co. , Ltd. 250,000.00
Dalian Bingshan Engineering & Trading Co., Ltd. 357,244.17 649,748.52
Dalian Third Refrigeration Equipment Factory 1,900,000.00 300,000.00
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. 500,000.00 600,000.00
Dalian Spindle Cooling Towers Co., Ltd. 52,000.00
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(7) Accounts received in advance
Names of the related parties 30-06-2015 31-12-2014
Dalian Bingshan Engineering & Trading Co., Ltd. 1,669,075.20 394,474.36
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
20,000.00
Co., Ltd.
(8) Other accounts payable
Names of the related parties 30-06-2015 31-12-2014
Dalian Bingshan Group Co., Ltd. 20,489,740.68 10,015,792.27
Dalian Third Refrigeration Equipment Factory 1,000.00 1,000.00
Dalian Bingshan Engineering & Trading Co., Ltd. 18,173.95 17,441.44
MHI Bingshan Refrigeration (Dalian) Co., Ltd. 483,441.71 475,863.95
XII Share-based payment
1. Overall situation
Total equity instrument awarded by the Company in the Period 10,150,000.00
Total equity instrument exercised in the Period 10,150,000.00
Total equity instrument that out of operation in the Period
5.56Yuan/Share, in three phases, the
Range of the outstanding exercise price for stock option at period-end remaining period in contract
and remaining period of the contract respectively has 12 months, 24
months and 36 months
Range of the outstanding exercise price for other equity instrument at
period-end and remaining period of the contract
2. Share-based payment settled by equity
In line with the fair value of the restricted shares at
Determination method for the fair value of equity
grant date (not determining the fair value change after
instrument at grant date
grant date)
Determination basis for the number of exercising equity
Determined by actual exercising numbers
instrument
Reason of major difference between the estimation in
N/A
the Period and last period
The aggregate amount of share-based payment that
51,160,208.00
reckoned into capital reserve with equity settlement
Total expenses recognized by share-based payment that
51,160,208.00
settle by equity in the Period
th th
According to the 13 meeting of 6 session of the Board, resolution of the 1st extraordinary general
meeting of 2015 and regulation of Restricted Shares Incentive Plan (Draft), the Company awarded
the restricted shares to 41 equity incentive objects by way of orientate offering of A ordinary shares,
totally 10,150,000 shares are rewarded with price of 5.56 Yuan/Share, and the capital amounting to
RMB 56,434,000.00 in total after raised.
The equity incentive objects of the Company including the directors serves in the Company
(subsidiary included), the high-level management and other core employees that recognized as
incentive objects by the Board while the equity incentive plan announced, the supervisors,
independent directors, foreign directors and foreign managers are excluded.
XⅢ. Commitments and Contingency
1. No major commitments to be disclosed till June 30, 2015.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
2. No other contingency needed disclosed till June 30, 2015.
XIV Post balance sheet issues
1. Significant events had not adjusted
(1) Issue shares
The resolution of 17th meeting of 6th session of the Board has deliberated and approved the plan of
private placement of RMB ordinary shares (A-share), the fund raised are used in the relocation
reform project of the Company.
(2) Investment
As for the 17th meeting of 6th session of the Board, the Company purchased the 30% equity of
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd held by the Dalian Bingshan Group Co.,
Ltd. Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. comes to the subsidiary of the
Company after equity transfer completed.
As for the 18th meeting of 6th session of the Board, the Company purchased the 19% equity of
Wuhan New World Refrigeration Industry Co., Ltd. held by the Dalian Bingshan Group Co., Ltd
and the 30% equity of Wuhan New World Refrigeration Industry Co., Ltd. held by Sanyo Electric
Co., Ltd. The Wuhan New World Refrigeration Industry Co., Ltd. comes to the wholly-owned
subsidiary of the Company after equity transfer completed.
As for the 19th meeting of 6th session of the Board, the Company purchased the 29.212 percent
equity of Changzhou Jingxue Freezing Equipment Co., Ltd. with 130 million yuan. In which, 25
percent equity of Jingxue Freezing held by Jingxue Industry and Trade and 4.212 percent equity of
Jingxue Freezing held by Jingxue Investment .Changzhou Jingxue Freezing Equipment Co., Ltd.
comes to the affiliated company of the Company after equity transfer completed.
(3) Subsidiary absorbing and merging subsidiary
Resolution of 15th meeting of 6th session of the Board of directors agreed the Company’s
subsidiary Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. to absorb and merge
Dalian Bingshan Metal Processing Co., Ltd. The benchmark date for absorbing and merging was
made on 31st December 2014. After absorbing and merging, Dalian Bingshan Ryosetsu Quick
Freezing Equipment Co., Ltd. will be the surviving company.
(4) Significant lawsuit, arbitration and commitment
Not applicable.
2. Significant sales return after balance sheet day
Not applicable.
3. There was no other post balance sheet significant events except above mentioned.
XV. Other important things needed disclosed.
1. There was no corrections of prior period accounting errors during the current period.
2. There was no debt restructuring during the current period.
3. There was no assets exchange during the current period.
4. The Company didn’t design employer pension plan.
5. There was no discontinuing operation during the current period.
6. Segments information
(1) Standards and accounting policies of reporting segment
The company determines operating segment according to its organization structure, management
rules, inside reporting system. The operating segment should satisfy following conditions:
① The operating segment could generate income and incure expenses from normal operating
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
activities；
②The management could evaluate its operating effect, and then decide resources assignment and its
operating performance；
③The segment’s information of financial position and results of operations and cash flow could be
obtained.
The company determines reporting segment based on operating segments. The reporting segment
should satisfy one of the following conditions:：
① The operating segment’s income should be over 10% of total income；
② The number of the operating segment’s profit(or loss) should be over 10% of the number of total
profit and the number of total losses.
The transfer prices between segments were decided according to the market prices. The expenses of
common assets used by segments and other common expenses should be divided among the
segments according to the income.
(2) Elements of determining reporting segment and types of reporting segments’ products and
services
The company determined three reporting segments according to the geographic area, including
Northeast China, Central China and East China. The Northeast China segment included the
company’s head office and subsidiaries located in Dalian. The Central China segment included
subsidiary company Wuhan New World Refrigeration Industrial Co., Ltd. And the East China
segment included subsidiary’s subsidiary company Ningbo Bingshan Refrigeration Air Conditioner
Engineering Co., Ltd.
(3) The financial information of reporting segments
30-06-2015/2015.01-06
Items Northeast
Central China East China Offset Total
China
1 Operating income 86,325.76 10,366.39 1,349.83 26,867.95 71,174.03
Including: Income from
64,714.98 5,109.22 1,349.83 71,174.03
external transaction
Income from internal
21,610.78 5,257.17 26,867.95
transaction
2 Selling expenses 78,672.32 10,962.98 1,254.03 26,476.37 64,412.96
Including: Investment income
from associates and joint 4,808.31 4,808.31
ventures
Impairment on assets 257.10 -9.57 247.53
Depreciation and
1,599.01 539.83 5.55 2,144.39
amortization
3 Operating profits(loss) 7,868.83 -540.89 101.12 391.58 7,037.48
4 Income tax 538.48 8.40 22.28 569.16
5 Net profit(loss) 7,330.34 -549.28 78.84 391.58 6,468.32
6 Total assets 402,829.06 45,691.44 1,759.07 38,068.16 412,211.41
7 Total liabilities 95,107.58 32,652.35 1,246.00 14,779.29 114,226.64
8 Other significant non cash
3,314.44 993.56 21.92 4,329.92
items
Capital expenditure 3,314.44 993.56 21.92 4,329.92
The accounting policies of every operating segment were the same with described in the note IV.The
main accounting policies, accounting estimates and corrections of accounting errors.
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
7. There was no significant event which would affect the decision of investor during the
current period.
XVI. Notes to the financial statements of the parent company
1. Accounts receivable
(1) Classified by accounts nature
30-06-2015
Categories Balance Provision for doubtful debt
Book value
Amount Proportion Amount Proportion
Major single amount and
bad debt provision
provided individually
Bad debt provided on
342,519,951.14 100.00% 64,577,110.72 18.85% 277,942,840.42
group basis
Minor single amount but
bad debt provision
provided individually
Total 342,519,951.14 100.00% 64,577,110.72 18.85% 277,942,840.42
Continued:
31-12-2014
Categories Balance Provision for doubtful debt
Book value
Amount Proportion Amount Proportion
Major single amount and
bad debt provision
provided individually
Bad debt provided on
277,119,839.64 100.00% 71,812,337.04 25.91% 205,307,502.60
group basis
Minor single amount but
bad debt provision
provided individually
Total 277,119,839.64 100.00% 71,812,337.04 25.91% 205,307,502.60
Accounts receivable which bad debt provisions are provided on age basis in the group.
30-06-2015
Account ages
Amount Provision for bad debts Proportion rates
Within 1 year 217,923,809.11 6,985,356.92 5.00%
1 to 2 years 41,125,235.35 4,112,523.53 10.00%
2 to 3 years 29,859,188.65 8,957,756.59 30.00%
3 to 4 years 15,918,040.97 7,959,020.48 50.00%
4 to 5 years 5,656,119.31 4,524,895.45 80.00%
Over 5 years 32,037,557.75 32,037,557.75 100.00%
Total 342,519,951.14 64,577,110.72
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB 5,988,915.93 was regained.
(3) The write-off of accounts receivable during the reporting period
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Items Written off amount
16 clients 1,246,310.39
The reasons of accounts receivable write-off include termination of operation and disability of
payment, winning lawsuits but not finding executable assets, small balance not being collected for
long time, and disagreement rework charges etc.
(4) Accounts receivable top 5 on amount
Provision for bad
Companies Amount Proportion (%)
debts
Dalian Xinghai Bay Development and
11,242,693.00 3.28 11,242,693.00
Construction Management Centre
Beijing Huashang Bingshan Refrigeration and
9,064,857.08 2.65 453,242.85
Air-conditioning Machinery Co., Ltd.
Xuzhou Yurun agricultural products global
8,200,000.00 2.39 410,000.00
procurement center
Yili Twinings Biological Technology Co., Ltd. 7,190,812.00 2.10 359,540.60
COFCO Meat（Suqian）Co., Ltd. 7,178,265.85 2.10 2,121,817.76
Total 42,876,627.93 12.52 14,587,294.21
The ending account receivable increased 35.38% over that of period-begin, mainly because the
account receivable for goods from subsidiaries increased.
2. Other accounts receivable
(1) Classified by account nature
30-06-2015
Items Balance Provision for doubtful debt
Book value
Amount Proportion Amount Proportion
Major single amount and bad
debt provision provided
individually
Bad debt provided on group 24,941,184.54 100.00% 2,166,400.94 8.69% 22,774,783.60
basis
Minor single amount but bad
debt provision provided
individually
Total 24,941,184.54 100.00% 2,166,400.94 8.69% 22,774,783.60
Continued：
31-12-2014
Items Balance Provision for doubtful debt
Book value
Amount Proportion Amount Proportion
Major single amount and bad
debt provision provided
individually
Bad debt provided on group 23,056,627.39 100.00% 1,790,721.85 7.77% 21,265,905.54
basis
Minor single amount but bad
debt provision provided
individually
Total 23,056,627.39 100.00% 1,790,721.85 7.77% 21,265,905.54
Other accounts receivable which bad debt provisions are provided on age basis in the group
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
30-06-2015
Account ages
Amount Provision for bad debts Proportion rates
Within 1year 20,572,848.85 1,028,642.45 5.00%
1 to 2 years 2,874,837.59 287,483.76 10.00%
2 to 3 years 659,047.48 197,714.24 30.00%
3 to 4 years 250,000.00 125,000.00 50.00%
4 to 5 years 284,450.62 227,560.49 80.00%
Over 5 years 300,000.00 300,000.00 100.00%
Total 24,941,184.54 2,166,400.94
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB 387,267.59 was accrued provision for bad debts, and no amount was
switched back or regained.
(3)The other accounts receivable need to be written off during the reporting period.
Items Written off amount
2 clients 11,588.50
The reasons of accounts receivable write-off include termination of operation and disability of
payment, winning lawsuits but not finding executable assets, small balance not being collected for
long time, and disagreement rework charges etc.
(4) The nature of other accounts receivable
Items 30-06-2015 31-12-2014
Guarantee deposits 22,141,139.57 20,951,410.09
Petty cash 1,020,544.97 97,241.00
To or fro accounts
Prepayments over settlement periods 1,779,500.00 2,007,976.30
Total 24,941,184.54 23,056,627.39
(5) Top 5 on amount of other accounts receivable
Ending
balance of
Companies Nature Amount Age Proportion
provision for
bad debts
Dalian Tianbao Green Food Performance Less than 1
18,000,000.00 72.17% 900,000.00
Co., Ltd bonds year
Prepayments
Dalian Tianyi InfoTech Co.,
over settlement 1,779,500.00 1 to-2 years 7.13% 177,950.00
Ltd
periods
Jinzhou Dalian New Less than 1
District organs and Guarantee year, 1 to 2
1,586,623.95 6.36% 102,482.37
institutions of financial deposits years,2 to 3
accounting center years.
Dalian Detai Town Gas Guarantee 1 to 2 years;2
600,000.00 2.41% 80,000.00
China Co., Ltd. deposits to 3 years
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Ending
balance of
Companies Nature Amount Age Proportion
provision for
bad debts
Dalian municipal
construction engineering Migrant
workers wages 500,000.00 2 to3 years 2.00% 150,000.00
labor insurance margin
management center
Total 22,466,123.95 90.07% 1,410,432.37
3. Long-term equity investments
30-06-2015 31-12-2014
Nature Provision
Provision for
Book balance for Book value Book balance Book value
impairment
impairment
Subsidiaries 125,591,805.57 125,591,805.57 107,629,071.42 107,629,071.42
Joint ventures&
1,033,513,959.00 1,033,513,959.00 1,039,229,738.85 1,039,229,738.85
affiliated companies
Total 1,159,105,764.57 1,159,105,764.57 1,146,858,810.27 1,146,858,810.27
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(1) Subsidiaries
Provision for Provision
Increased
Beginning Decreased during impairment of
Names during current Ending balance for
balance current period the current
period
period impairment
Dalian Bingshan Group Refrigeration Installation Co.,
20,036,841.62 2,712,834.15 22,749,675.77
Ltd
Dalian Bingshan Group Sales Company 12,936,700.00 12,936,700.00
Dalian Bingshan Metal Processing Co., Ltd 12,501,344.60 9,249,900.00 21,751,244.60
Dalian Bingshan Air-Conditioning Equipment Co., Ltd 36,506,570.00 36,506,570.00
Dalian Bingshan Guardian Automation Co., Ltd 1,522,117.80 1,522,117.80
Dalian Bingshan Ryosetsu Quick Freezing Equipment
5,745,097.40 5,745,097.40
Co., Ltd
Wuhan New World Refrigeration Industrial Co., Ltd 17,980,400.00 17,980,400.00
Wuhan New World Refrigeration Air Conditioner
400,000.00 400,000.00
Engineering Co., Ltd
Bingshan Technology Service (Dalian) Co., Ltd. 6,000,000.00 6,000,000.00
Total 107,629,071.42 17,962,734.15 125,591,805.57
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(2) Joint ventures& affiliated companies
Increase/Decrease
Provision
Gains and losses Adjustment Chang Cash bonus or for Provision
Beginning
Names recognized of other es of profits impairment Ending balance for
balance Increased Decreased Others
under the equity comprehens other announced to of the impairment
method ive income equity issue current
period
1. Joint ventures
Dalian Bingshan – P&A
Recreation Development 3,553,919.97 -377,150.35 3,176,769.62
Engineering Co., Ltd
Subtotal 3,553,919.97 -377,150.35 3,176,769.62
2. Affiliated companies
Dalian Bingshan
Engineering & Trading Co. , 13,716,985.57 1,302,858.87 15,019,844.44
Ltd
Panasonic Refrigeration
155,826,086.27 -3,011,036.73 5,200,000.00 147,615,049.54
(Dalian) Co., Ltd
Dalian Honjo Chemical Co.,
9,403,913.18 231,620.31 1,203,061.37 8,432,472.12
Ltd
Panasonic Cold-Chain
215,573,606.48 2,965,904.37 8,000,000.00 210,539,510.85
(Dalian) Co., Ltd
Keinin-Grand Ocean
Thermal Technology 42,333,942.39 7,612,764.78 9,600,000.00 40,346,707.17
(Dalian) Co., Ltd
Panasonic Compressor
432,515,006.40 29,441,902.46 34,000,000.00 427,956,908.86
(Dalian) Co., Ltd
Dalian Sanyo Meica
23,233,848.71 -889,967.73 22,343,880.98
Electronics Co., Ltd
MHI Bingshan Refrigeration
29,294,087.63 -2,308,578.44 26,985,509.19
(Dalian) Co.,Ltd
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Increase/Decrease
Provision
Gains and losses Adjustment Chang Cash bonus or for Provision
Beginning
Names recognized of other es of profits impairment Ending balance for
balance Increased Decreased Others
under the equity comprehens other announced to of the impairment
method ive income equity issue current
period
Beijing Huashang Bingshan
Refrigeration and
1,425,989.62 1,754,200.00 -512,013.13 2,668,176.49
Air-conditioning Machinery
Co., Ltd
Dalian Fuji Bingshan
89,896,843.61 12,411,144.13 102,307,987.74
Vending Machine Co., Ltd
Daliian Sanyo High-Efficient
Refrigeration System Co., 22,455,509.02 105,357.69 22,560,866.71
Ltd
Dalian Fuji Bingshan
Vending Machine Sales Co., 2,450,000.00 1,110,275.29 3,560,275.29
Ltd
Subtotal 1,035,675,818.88 4,204,200.00 48,460,231.87 58,003,061.37 1,030,337,189.38
Total 1,039,229,738.85 4,204,200.00 48,083,081.52 58,003,061.37 1,033,513,959.00
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Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
4. Total operating income and operating cost
(1)Business income and cost
2015.01-06 2014.01-06
Items
Income Cost Income Cost
Key business 294,886,893.24 244,284,674.93 460,374,451.87 377,487,851.62
Other business 4,988,277.85 3,038,280.79 10,595,768.10 9,459,681.22
Total 299,875,171.09 247,322,955.72 470,970,219.97 386,947,532.84
5. Gain/ (loss) from investments
Category
Items 2015.01-06 2014.01-06
Gain arising from dividends of subsidiaries 3,915,784.39 2,100,000.00
Long-term equity investment income accounted for by using the equity method 48,083,081.52 53,897,497.58
Gain on selling equity of associate company 681,816.41
Gain from holding of financial assets available for sale 310,000.00 1,754,944.75
Gain from disposal financial assets available for sale
Total 52,308,865.91 58,434,258.74
XVII. Other supplementary Information
1. Non-recurring profits and losses
Non-recurring gains and losses items Amount Notes
1. Gain/loss from disposal of non-current assets 26,473.73
2.Tax return or exemption exceeding authority or without formal authorization documents 1,447.50
3.Governmental subsidy written into current gains and losses 1,751,055.19
4. Interest from non-financial enterprises written into current gains and losses
5.Gains/Losses on debt restructuring
6.Reversal of provision for impairment of long-term assets
7. Gain/loss from change of fair value of transactional asset and liabilities, and investment
gains from disposal of transactional financial assets and liabilities and sellable financial
assets, other than valid period value instruments related to the Company’s common
businesses.
8.Other net income and expense from non-operation 135,520.95
Total
Less：Affected amount of income tax from non-recurring gains and losses 303,540.74
Net amount of non-recurring gains and losses
Included: Attributable to minority shareholders’ equity 13,509.15
Attributable to the owners of parent company 1,597,447.48
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2. Earnings per share
The weighted EPS
Items
average ROE Basic EPS Diluted EPS
Net profit attributable to the Company’s ordinary shareholders 3.26% 0.18 0.18
Net profit attributable to the Company’s ordinary shareholders
3.18% 0.18 0.18
after deducting non-recurring gains and losses
3. The differences between domestic and international accounting standards
There were no significant differences between domestic and international accounting standards among the
Company’s financial statements of the current period.
104
Dalian Refrigeration Co., Ltd. 2015 Semiannual Report
Section 10 Reference Documents
1. The accounting statements bearing the signatures and seals of the legal representative, the financial
majordomo and the accountants in charge.
2. The original copies of all the Company's documents and the original copies of the bulletins published on the
newspapers designated by the China Securities Regulatory Commission in the report period.
3. Time for reference: from Monday to Friday 8:00 - 12:00 (am) 1:00 - 5:00 (pm)
Liaison persons: Mr. Song Wenbao，Miss Du Yu
Tel: 0086-411-86538130
Fax: 0086-411-86654530
Board of Directors of Dalian Refrigeration Co., Ltd.
August 19, 2015
105
