JIANGLING MOTORS CORPORATION, LTD.
FINANCIAL STATEMENTS AND
FOR THE SIX MONTHS ENDED 30 JUNE 2021
1
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY BALANCE SHEET AS AT 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
31 December 31 December
Assets Note 30 June 2021 2020 30 June 2021 2020
Consolidated* Consolidated Company* Company
Current assets
Cash and cash equivalents 4(1) 10,950,186,735 11,121,955,129 8,208,750,569 8,473,562,045
Financial assets held for
trading 4(2) 553,211,507 803,892,985 - 502,797,917
4(3)、
Accounts receivable 14(1) 3,401,921,804 2,999,883,212 3,108,512,087 3,330,880,651
Financing receivables 4(4) 428,573,213 815,583,669 529,914,581 29,412,448
Advances to suppliers 4(5) 579,396,268 452,714,683 579,292,941 451,832,917
4(6)、
Other receivables 14(2) 216,179,929 128,989,573 241,702,042 1,359,907,223
Inventories 4(7) 2,178,815,436 2,086,605,692 2,108,932,110 2,020,079,494
Other current assets 4(8) 885,726,989 737,369,737 825,850,162 678,079,950
Total current assets 19,194,011,881 19,146,994,680 15,602,954,492 16,846,552,645
Non-current assets
4(9)、
Long-term equity investments 14(3) 39,232,347 39,496,548 2,807,175,840 1,561,496,548
Fixed assets 4(10) 4,785,494,825 5,165,956,410 3,991,109,365 4,331,796,677
Construction in progress 4(11) 1,927,985,414 1,535,497,770 1,828,963,510 1,429,348,858
Right-of-use assets 4(12) 40,768,628 28,405,890 38,582,276 28,405,890
Intangible assets 4(13) 1,063,475,861 931,391,553 773,702,506 637,918,837
Development expenditures 4(13) 29,063,385 173,473,242 29,063,385 173,473,242
Deferred tax assets 4(14) 1,328,196,010 1,163,969,325 365,889,704 370,120,915
Total non-current assets 9,214,216,470 9,038,190,738 9,834,486,586 8,532,560,967
TOTAL ASSETS 28,408,228,351 28,185,185,418 25,437,441,078 25,379,113,612
2
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY BALANCE SHEET AS AT 30 JUNE 2021(CONTINUED)
(All amounts in RMB Yuan unless otherwise stated)
Liabilities and owners' equity Note 30 June 2021 31 December 2020 30 June 2021 31 December 2020
Consolidated* Consolidated Company* Company
Current liabilities
Short-term borrowings 4(16) 500,000,000 500,000,000 500,000,000 500,000,000
Derivative financial liabilities 4(17) 8,165,742 3,716,727 8,165,742 3,716,727
Notes payable 4(18) 1,565,665 - - -
Accounts payable 4(19) 9,408,546,403 10,026,215,877 9,401,623,759 10,022,399,964
Contract liabilities 4(20) 155,880,367 558,526,846 40,313,165 42,397,868
Employee benefits payable 4(21) 632,200,970 759,368,606 571,222,642 687,984,808
Taxes payable 4(22) 291,614,997 218,445,227 102,947,957 95,599,544
Other payables 4(23) 8,024,900,054 4,153,849,625 4,714,357,954 1,495,307,482
Current portion of non-current
liabilities 4(24) 16,602,776 10,909,163 16,082,883 10,909,163
Other current liabilities 4(25) 382,857,533 410,899,328 33,417,221 39,220,370
Total current liabilities 19,422,334,507 16,641,931,399 15,388,131,323 12,897,535,926
Non-current liabilities
Long-term borrowings 4(26) 2,326,688 2,563,666 2,326,688 2,563,666
Lease liabilities 4(27) 27,854,023 18,998,952 25,883,102 18,998,952
Provisions 4(28) 206,997,083 195,896,139 - -
Deferred income 4(29) 48,943,773 49,944,625 48,943,773 49,944,625
Long-term employee benefits
payable 4(30) 60,786,693 62,855,000 60,492,693 62,561,000
Deferred tax liabilities 4(14) 142,239,570 126,995,164 117,891,524 102,300,000
Other non-current liabilities 4(31) 105,589,814 99,526,464 98,706,996 90,866,994
Total non-current liabilities 594,737,644 556,780,010 354,244,776 327,235,237
Total liabilities 20,017,072,151 17,198,711,409 15,742,376,099 13,224,771,163
Equity
Share capital 4(32) 863,214,000 863,214,000 863,214,000 863,214,000
Capital surplus 4(33) 839,442,490 839,442,490 839,442,490 839,442,490
Other comprehensive income 4(34) (11,759,250) (11,759,250) (12,021,750) (12,021,750)
Surplus reserve 4(35) 431,607,000 431,607,000 431,607,000 431,607,000
Retained earnings 4(36) 6,268,651,960 8,863,969,769 7,572,823,239 10,032,100,709
Total equity attributable to
shareholders of the Company 8,391,156,200 10,986,474,009 9,695,064,979 12,154,342,449
Minority interests - - - -
Total equity 8,391,156,200 10,986,474,009 9,695,064,979 12,154,342,449
TOTAL LIABILITIES AND EQUITY 28,408,228,351 28,185,185,418 25,437,441,078 25,379,113,612
note：* Unaudited financial indexes
Legal representative：Qiu Tiangao CFO：Li Weihua Finance Department：Ding Ni
3
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY INCOME STATEMENTS FOR 2021 FIRST HALF-YEAR
(All amounts in RMB Yuan unless otherwise stated)
2021 First 2020 First 2021 First 2020 First
Item Note Half-year Half-year Half-year Half-year
Consolidated* Consolidated* Company* Company*
Revenue 4(37)、14(4) 17,675,621,088 14,073,417,878 16,423,558,481 13,100,109,933
4(37)、
Less: Cost of sales
4(43)、14(4) (15,050,224,719) (11,860,122,365) (14,542,226,983) (11,197,514,026)
Taxes and surcharges 4(38) (479,241,514) (386,579,142) (457,195,578) (374,566,719)
Selling and distribution
expenses 4(39)、4(43) (949,514,418) (592,187,320) (137,982,658) (106,442,789)
General and administrative
expenses 4(40)、4(43) (529,817,540) (459,127,446) (446,001,303) (358,155,678)
Research and development
expenses 4(41)、4(43) (726,466,190) (696,582,452) (718,611,661) (694,302,769)
Financial expenses 4(42) 145,442,287 66,731,813 116,227,293 67,945,339
Including: Interest expenses (12,133,084) (19,061,965) (12,101,916) (16,322,688)
Interest income 149,147,665 94,240,518 119,819,393 91,873,400
Add: Other income 4(46) 333,292,836 165,639,467 333,208,941 145,105,792
Investment income 4(47)、14(5) (10,863,242) 28,278,000 (4,619,007) 28,278,000
Including: Share of profit of
associates and joint ventures 4(47) (264,201) (3,024,554) (264,201) (3,024,554)
Gains on changes in fair value 4(48) (5,130,493) 10,012,041 (7,246,932) 10,012,041
Credit impairment losses 4(45) 7,389,378 (66,242,811) 1,197,855 (61,963,003)
Asset impairment losses 4(44) - (34,107,710) - (20,994,208)
Gains on disposal of assets 4(49) 11,152,182 (581,955) 20,345,706 (1,145,364)
Operating profit 421,639,655 248,547,998 580,654,154 536,366,549
Add: Non-operating income 4(50) 2,510,277 3,599,193 1,052,244 3,052,524
Less: Non-operating expenses 4(51) (2,584,982) (30,238,252) (2,387,862) (30,104,671)
Total profit 421,564,950 221,908,939 579,318,536 509,314,402
Less: Income tax expenses 4(52) (16,350,895) (14,137,157) (38,064,142) (21,565,844)
Net profit 405,214,055 207,771,782 541,254,394 487,748,558
Classified by continuity of
operations
Net profit from continuing
operations 405,214,055 207,771,782 541,254,394 487,748,558
Net profit from discontinued
operations - - - -
Classified by ownership of the
equity
Minority interests - - - -
Attributable to shareholders of
the Company 405,214,055 207,771,782 541,254,394 487,748,558
Other comprehensive
income, net of tax - - - -
Attributable to shareholders of
the Company
Other comprehensive income
items which will not be
reclassified to profit or loss
Changes arising from
remeasurement of defined
benefit plan 4(34) - - - -
Attributable to minority
interests
Total comprehensive
income 405,214,055 207,771,782 541,254,394 487,748,558
Attributable to shareholders of
the Company 405,214,055 207,771,782 541,254,394 487,748,558
Attributable to minority
interests - - - -
4
Earnings per share
Basic earnings per share(RMB
Yuan) 4(53) 0.47 0.24 —— ——
Diluted earnings per
share(RMB Yuan) 4(53) 0.47 0.24 —— ——
note：* Unaudited financial indexes
Legal representative：Qiu Tiangao CFO：Li Weihua Finance Department：Ding Ni
5
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS FOR 2021 FIRST HALF-
YEAR
(All amounts in RMB Yuan unless otherwise stated)
2021 First 2020 First 2021 First 2020 First
Item Note Half-year Half-year Half-year Half-year
Consolidated* Consolidated* Company* Company*
Cash flows from operating
activities
Cash received from sales of goods
or rendering of services 19,342,042,070 14,440,474,744 17,810,262,253 12,911,082,079
Cash received relating to other
operating activities 4(54) 450,958,933 245,920,384 364,859,759 187,369,975
Sub-total of cash inflows 19,793,001,003 14,686,395,128 18,175,122,012 13,098,452,054
Cash paid for goods and services (15,712,429,064) (10,617,165,843) (15,292,180,904) (10,193,382,381)
Cash paid to and on behalf of
employees (1,504,023,988) (1,084,107,268) (1,400,304,399) (962,774,043)
Payments of taxes and surcharges (1,271,259,251) (1,021,043,215) (1,022,744,168) (838,116,455)
Cash paid relating to other
operating activities 4(54) (1,235,370,851) (1,229,795,175) (663,632,878) (768,797,800)
Sub-total of cash outflows (19,723,083,154) (13,952,111,501) (18,378,862,349) (12,763,070,679)
Net cash flows from operating
activities 4(55) 69,917,849 734,283,627 (203,740,337) 335,381,375
Cash flows from investing
activities
Cash received from disposal of
investments 1,850,000,000 6,471,000,000 2,142,000,000 9,238,976,131
Cash received from returns on
investments 10,204,593 32,619,541 3,894,456 32,619,541
Net cash received from disposal of
fixed assets, intangible assets and
other long-term assets 13,292,324 7,983,584 12,434,835 7,062,524
Net cash received from disposal of
subsidiaries and other business
units 108,000,000 - 108,000,000 -
Cash received relating to other
investing activities 4(54) 122,821,020 96,772,432 101,929,208 164,343,358
Sub-total of cash inflows 2,104,317,937 6,608,375,557 2,368,258,499 9,443,001,554
Cash paid to acquire fixed assets,
intangible assets and other long-
term assets (722,025,976) (493,537,475) (715,324,702) (480,691,940)
Cash paid to acquire investments (1,600,000,000) (9,189,000,000) (1,688,461,068) (12,088,976,131)
Cash paid relating to other
investing activities (7,829,410) (1,928,931) (7,829,408) (1,928,931)
Sub-total of cash outflows (2,329,855,386) (9,684,466,406) (2,411,615,178) (12,571,597,002)
Net cash flows from investing
activities (225,537,449) (3,076,090,849) (43,356,679) (3,128,595,448)
Cash flows from financing
activities
Cash received from borrowings 989,255,556 1,800,000,000 989,255,556 1,800,000,000
Sub-total of cash inflows 989,255,556 1,800,000,000 989,255,556 1,800,000,000
Cash repayments of borrowings (1,000,214,487) (500,231,444) (1,000,214,487) (500,231,444)
Cash payments for distribution of
dividends, profits or interest
expenses (2,346,105) (18,544,156) (2,346,105) (15,845,917)
Cash paid relating to other
financing activities 4(54) (4,409,423) (4,800,032) (4,409,424) (3,603,380)
Sub-total of cash outflows (1,006,970,015) (523,575,632) (1,006,970,016) (519,680,741)
Net cash flows from financing
activities (17,714,459) 1,276,424,368 (17,714,460) 1,280,319,259
Effect of foreign exchange rate
changes on cash and cash - - - -
6
equivalents
Net decrease in cash and cash
equivalents 4(55) (173,334,059) (1,065,382,854) (264,811,476) (1,512,894,814)
Add: Cash and cash equivalents at
beginning of year 4(55) 11,121,955,129 8,937,936,658 8,473,562,045 8,677,928,946
Cash and cash equivalents at
end of period 4(55) 10,948,621,070 7,872,553,804 8,208,750,569 7,165,034,132
note：* Unaudited financial indexes
Legal representative：Qiu Tiangao CFO：Li Weihua Finance Department：Ding Ni
7
JIANGLING MOTORS CORPORATION, LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
Attributable to equity owners of the Company
Other Minority
Item Note Capital Surplus Total equity
Share capital comprehensive Retained earnings interests
surplus reserves
income
Balance at 1 January 2020 863,214,000 839,442,490 (11,395,500) 431,607,000 8,373,695,791 - 10,496,563,781
Movements for the six months ended
- - - -
30 June 2020* 147,346,802 - 147,346,802
Total comprehensive income
Net profit - - - - 207,771,782 - 207,771,782
Other comprehensive income - - - - - - -
Total comprehensive income for the year - - - - 207,771,782 - 207,771,782
Profit distribution
Distribution to shareholders 4(36) - - - - (60,424,980) - (60,424,980)
Balance at 30 June 2020* 863,214,000 839,442,490 (11,395,500) 431,607,000 8,521,042,593 - 10,643,910,583
Balance at 1 January 2021 863,214,000 839,442,490 (11,759,250) 431,607,000 8,863,969,769 - 10,986,474,009
Movements for the six months ended
- - - -
30 June 2021* (2,595,317,809) - (2,595,317,809)
Total comprehensive income
Net profit - - - - 405,214,055 - 405,214,055
Other comprehensive income - - - - - - -
Total comprehensive income for the year - - - - 405,214,055 - 405,214,055
Profit distribution
Distribution to shareholders 4(36) - - - - (3,000,531,864) - (3,000,531,864)
Balance at 30 June 2021* 863,214,000 839,442,490 (11,759,250) 431,607,000 6,268,651,960 - 8,391,156,200
note：* Unaudited financial indexes
Legal representative：Qiu Tiangao CFO：Li Weihua Finance Department：Ding Ni
8
JIANGLING MOTORS CORPORATION, LTD.
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
Other
Item Note Share capital Capital surplus comprehensive Surplus reserves Retained earnings Total equity
income
Balance at 1 January 2020 863,214,000 839,442,490 (11,616,750) 431,607,000 9,484,175,533 11,606,822,273
Movements for the six
months ended 30 June 2020* - - - - 427,323,578 427,323,578
Total comprehensive income
Net profit - - - - 487,748,558 487,748,558
Other comprehensive income - - - - - -
Total comprehensive income
for the year - - - - 487,748,558 487,748,558
Profit distribution
Distribution to shareholders 4(36)
- - - - (60,424,980) (60,424,980)
Balance at 30 June 2020* 863,214,000 839,442,490 (11,616,750) 431,607,000 9,911,499,111 12,034,145,851
Balance at 1 January 2021 863,214,000 839,442,490 (12,021,750) 431,607,000 10,032,100,709 12,154,342,449
Movements for the six
months ended 30 June 2021* - - - - (2,459,277,470) (2,459,277,470)
Total comprehensive income
Net profit - - - - 541,254,394 541,254,394
Other comprehensive income - - - - - -
Total comprehensive income
for the year - - - - 541,254,394 541,254,394
Profit distribution
Distribution to shareholders 4(36)
- - - - (3,000,531,864) (3,000,531,864)
Balance at 30 June 2021* 863,214,000 839,442,490 (12,021,750) 431,607,000 7,572,823,239 9,695,064,979
note：* Unaudited financial indexes
Legal representative：Qiu Tiangao CFO：Li Weihua Finance Department：Ding Ni
9
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
1 General information
Jiangling Motors Corporation, Ltd. (hereinafter “the Company”) is a Sino-foreign joint stock
enterprise established under the approval of Hongban (1992) No. 005 of Nanchang
Revolution and Authorisation Group of Company’s Joint Stock on the basis of Jiangxi
Motors Manufacturing Factory on 16 June 1992. The registration number of the enterprise
business license is No. 913600006124469438. The registered address of the Company
and the address of its headquarters are both Nanchang City, Jiangxi Province of the
People’s Republic of China (“the PRC”).
On 23 July 1993, with the approval of the China Securities Regulatory Commission
(hereinafter “CSRC”) (Zheng Jian Fa Shen Zi [1993] No. 22) and (Zheng Jian Han Zi
[1993] No. 86), the Company was listed on the Stock Exchange of Shenzhen on 1
December 1993, issuing 494,000,000 shares in total. On 8 April 1994, a total of
25,214,000 shares were distributed for the 1993 dividend distribution programme with the
approval of the shareholders’ meeting and Jiangxi Securities Management Leading Group
(Gan Securities [1994] No. 02). In 1995, with the approval of CSRC (Zheng Jian Fa Zi
[1995] No. 144) and the Shenzhen Securities Management Office (Shenzhen Office Fu
[1995] No. 92), the Company issued 174,000,000 ordinary shares (“B shares”). In 1998,
with the approval of CSRC (Zheng Jian Fa Zi [1998] No. 19), the Company issued
additional 170,000,000 B shares.
According to the resolution of the shareholders’ meeting regarding the split share structure
reform on 11 January 2006, the Company implemented the Scheme on Split Share
Structure Reform on 13 February 2006. After the implementation, the Company’s total
paid-in capital remains the same. Related details are disclosed in Note 4(33).
As at 30 June 2021, the Company’s paid-in capital totalled RMB863,214,000, with par
value of RMB1 per share.
The business scope of the Company and its subsidiaries (hereinafter “the Group”) includes
production and sales of automobile assemblies such as automobiles, special (modified)
vehicles, engines and chassis and other automobile parts, and provision of related after-
sales services; retail and wholesale of imported E series automobiles of Ford Motor
(China) Co., Ltd. (“FORD”) as the dealer; import and export of automobiles and parts;
dealership of used cars; provision enterprise management and consulting services related
to production and sales of automobiles.
Subsidiaries included in the consolidation scope for the current period are detailed in Note
5.
These financial statements were authorised for issue by the Company's Board of Directors
on 26 August 2021.
2 Summary of significant accounting policies and accounting estimates
The Group determines specific accounting policies and estimates based on the features of
its production and operation, which mainly comprise the measurement of expected credit
losses (“ECL”) on receivables (Note 2(8)), valuation of inventories (Note 2(9)), depreciation
of fixed assets and amortisation of intangible assets and right-of-use assets (Note 2(11),
(14), (22)), criteria for capitalisation of development expenditures (Note 2(14)), recognition
and measurement of revenue (Note 2(19)), etc.
Key judgements and critical accounting estimates and key assumptions applied by the
Group on the determination of significant accounting policies are set out in Note 2(24).
10
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(1) Basis of preparation
The financial statements are prepared in accordance with the Accounting Standards for
Business Enterprises - Basic Standard, specific accounting standards and relevant
regulations issued by the Ministry of Finance on 15 February 2006 and in subsequent
periods (hereinafter collectively referred to as “the Accounting Standards for Business
Enterprises” or “CASs”) and the disclosure requirements in the Preparation Convention of
Information Disclosure by Companies Offering Securities to the Public No.15 - General
Rules on Financial Reporting issued by CSRC.
The financial statements are prepared on a going concern basis.
(2) Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the Six Months Ended 30 June 2021 are in
compliance with the Accounting Standards for Business Enterprises, and truly and
completely present the consolidated and company’s financial position of the Company as
at 30 June 2021 and their financial performance, cash flows and other information for the
year then ended.
(3) Fiscal year
The Company’s fiscal year starts on 1 January and ends on 30 June.
(4) Recording currency
The recording currency is Renminbi (“RMB”). The financial statements are presented in
RMB.
(5) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company
and all of its subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and are
de-consolidated from the date that such control ceases. For a subsidiary that is acquired in
a business combination involving enterprises under common control, it is included in the
consolidated financial statements from the date when it, together with the Company,
comes under common control of the ultimate controlling party. The portion of the net profits
realised before the combination date is presented separately in the consolidated income
statement.
In preparing the consolidated financial statements, where the accounting policies or the
accounting periods of the Company and subsidiaries are inconsistent, the financial
statements of the subsidiaries are adjusted in accordance with the accounting policies and
the accounting period of the Company. For subsidiaries acquired from business
combinations not involving enterprises under common control, the individual financial
statements of the subsidiaries are adjusted based on the fair value of the identifiable net
assets at the acquisition date.
11
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(5) Preparation of consolidated financial statements (Cont'd)
All significant intra-group balances, transactions and unrealised profits are eliminated in
the consolidated financial statements. The portion of subsidiaries’ shareholders' equity and
the portion of subsidiaries’ net profits and losses and comprehensive income for the period
not attributable to the Company are recognised as minority interests, net profit attributed to
minority interests and total comprehensive income attributed to minority interests, and
presented separately in the consolidated financial statements under shareholders' equity,
net profits and total comprehensive income respectively. If the subsidiaries’ loss for the
current period attributed to the minority shareholders exceeds their share in the opening
shareholder’s equity, the excess will be deducted against the minority interests. Unrealised
profits and losses resulting from the sale of assets by the Company to its subsidiaries are
fully eliminated against net profit attributable to owners of the parent. Unrealised profits
and losses resulting from the sale of assets by a subsidiary to the Company are eliminated
and allocated between net profit attributable to owners of the parent and net profit
attributed to minority interests in accordance with the allocation proportion of the parent in
the subsidiary. Unrealised profits and losses resulting from the sale of assets by one
subsidiary to another are eliminated and allocated between net profit attributable to owners
of the parent and net profit attributed to minority interests in accordance with the allocation
proportion of the parent in the subsidiary.
If the accounting treatment of a transaction is inconsistent in the financial statements at the
Group level and at the Company or its subsidiary level, adjustment will be made from the
perspective of the Group.
(6) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on
demand, and short-term and highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
(7) Foreign currency translation
Foreign currency transactions
Foreign currency transactions are translated into recording currency using the exchange
rates prevailing at the dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are
translated into recording currency using the spot exchange rates on the balance sheet
date. Exchange differences arising from these translations are recognised in profit or loss
for the current period, except for those attributable to foreign currency borrowings that
have been taken out specifically for acquisition or construction of qualifying assets, which
are capitalised as part of the cost of those assets. Non-monetary items denominated in
foreign currencies that are measured at historical costs are translated at the balance sheet
date using the spot exchange rates at the date of the transactions. The effect of exchange
rate changes on cash is presented separately in the cash flow statement.
12
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a
financial liability or equity instrument of another entity. A financial asset or a financial
liability is recognised when the Group becomes a party to the contractual provisions of the
instrument.
(a) Financial assets
(i) Classification and measurement
Based on the business model for managing the financial assets and the contractual cash
flow characteristics of the financial assets, financial assets are classified as: (1) financial
assets at amortised cost; (2) financial assets at fair value through other comprehensive
income; (3) financial assets at fair value through profit or loss.
The financial assets are measured at fair value at initial recognition. Related transaction
costs that are attributable to the acquisition of the financial assets are included in the
initially recognised amounts, except for the financial assets at fair value through profit or
loss, the related transaction costs of which are recognised directly in profit or loss for the
current period. Accounts receivable or notes receivable arising from sales of products or
rendering of services (excluding or without regard to significant financing components) are
initially recognised at the consideration that is entitled to be charged by the Group as
expected.
Debt instruments
The debt instruments held by the Group refer to the instruments that meet the definition of
financial liabilities from the perspective of the issuer, and are measured in the following
three ways:
Measured at amortised cost:
The objective of the Group’s business model is to hold the financial assets to collect the
contractual cash flows, and the contractual cash flow characteristics are consistent with a
basic lending arrangement, which gives rise on specified dates to the contractual cash
flows that are solely payments of principal and interest on the principal amount
outstanding. The interest income of such financial assets is recognised using the effective
interest method. Such financial assets mainly include cash at bank and on hand, notes
receivable, accounts receivable and other receivables, etc.
13
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
Measured at fair value through other comprehensive income:
The objective of the Group’s business model is to hold the financial assets to both collect
the contractual cash flows and sell such financial assets, and the contractual cash flow
characteristics are consistent with a basic lending arrangement. Such financial assets are
measured at fair value through other comprehensive income, except for the impairment
gains or losses, foreign exchange gains and losses, and interest income calculated using
the effective interest method which are recognised in profit or loss for the current period.
Such financial assets mainly include financing receivables, etc.
Measured at fair value through profit or loss:
Debt instruments held by the Group that are not divided into those at amortised cost, or
those measured at fair value through other comprehensive income, are measured at fair
value through profit or loss. At initial recognition, the Group does not designate a portion of
financial assets as at fair value through profit or loss to eliminate or significantly reduce an
accounting mismatch. Financial assets that are due in more than one year as from the
balance sheet date and are expected to be held for over one year are included in other
non-current financial assets, and the others are included in financial assets held for
trading.
14
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(ii) Impairment
Loss provision for financial assets at amortised cost and investments in debt instruments at
fair value through other comprehensive income is recognised on the basis of ECL.
Giving consideration to reasonable and supportable information on past events, current
conditions and forecasts of future economic conditions, as well as the default risk weight,
the Group recognises the ECL as the probability-weighted amount of the present value of
the difference between the cash flows receivable from the contract and the cash flows
expected to collect.
As at each balance sheet date, the ECL of financial instruments at different stages are
measured respectively. 12-month ECL provision is recognised for financial instruments in
Stage 1 that have not had a significant increase in credit risk since initial recognition;
lifetime ECL provision is recognised for financial instruments in Stage 2 that have had a
significant increase in credit risk yet without credit impairment since initial recognition; and
lifetime ECL provision is recognised for financial instruments in Stage 3 that have had
credit impairment since initial recognition.
For the financial instruments with low credit risk on the balance sheet date, the Group
assumes there is no significant increase in credit risk since initial recognition and
recognises the 12-month ECL provision.
For the financial instruments in Stage 1, Stage 2 and with low credit risk, the Group
calculates the interest income by applying the effective interest rate to the gross carrying
amount (before deduction of the impairment provision). For the financial instrument in
Stage 3, the interest income is calculated by applying the effective interest rate to the
amortised cost (after deduction of the impairment provision from the gross carrying
amount).
For notes receivable, accounts receivable and financing receivables arising from sales of
goods and rendering of services in the ordinary course of operating activities, the Group
measures the lifetime ECL provision regardless of whether there is a significant financing
component.
15
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(ii) Impairment (Cont’d)
In case the ECL of an individually assessed financial asset can be evaluated with
reasonable cost, the Group determines the ECL based on impairment assessment of an
individual financial asset. In case the ECL of an individually assessed financial asset
cannot be evaluated with reasonable cost, the Group divides the receivables into certain
groupings based on credit risk characteristics, and calculates the ECL for the groupings.
Basis for determining groupings and related provision method are as follows:
Grouping - Bank acceptance notes State-owned banks and joint stock banks
Grouping - Sales of general automobiles Customers of general automobiles
Grouping - Sales of new energy automobiles Customers of new energy automobiles
Grouping - Sales of other automobiles Customers of other automobiles
Grouping - Sales of automobile parts Customers of automobile parts
Grouping - Interest from cash at bank Accrued interest on cash at bank
Grouping - Operating advances and Operating advances and guarantees
guarantees
For accounts receivable that are classified into groupings and notes receivable and
financing receivables arising from sales of goods and rendering of services in the ordinary
course of operating activities, the Group calculates the ECL with reference to historical
credit losses experience, current conditions and forecasts of future economic conditions,
and based on the exposure at default and the lifetime ECL rate. For other notes receivable,
financing receivables and other receivables classified into groupings, the Group calculates
the ECL with reference to the historical credit loss experience, current conditions and
forecasts of future economic conditions, and based on the exposure at default and the 12-
month or lifetime ECL rate.
The Group recognises the loss provision made or reversed into profit or loss for the current
period. For debt instruments held at fair value through other comprehensive income, the
Group adjusts other comprehensive income while the impairment loss or gain is
recognised in profit or loss for the current period.
16
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(a) Financial assets (Cont’d)
(iii) Derecognition
A financial asset is derecognised when: (i) the contractual rights to the cash flows from the
financial asset expire, (ii) the financial asset has been transferred and the Group transfers
substantially all the risks and rewards of ownership of the financial asset to the transferee,
or (iii) the financial asset has been transferred and the Group has not retained control of
the financial asset, although the Group neither transfers nor retains substantially all the
risks and rewards of ownership of the financial asset.
When a financial asset is derecognised, the difference between the carrying amount and
the sum of the consideration received and the cumulative changes in fair value that are
previously recognised directly in other comprehensive income is recognised in profit or loss
for the current period.
(b) Financial liabilities
Financial liabilities are classified as financial liabilities at amortised cost and financial
liabilities at fair value through profit or loss at initial recognition.
Financial liabilities of the Group mainly comprise financial liabilities at amortised cost,
including notes payable, accounts payable, other payables, borrowings, etc. Such financial
liabilities are initially recognised at fair value, net of transaction costs incurred, and
subsequently measured using the effective interest method. Financial liabilities that are
due within one year (inclusive) are classified as current liabilities; those with maturities over
one year but are due within one year (inclusive) as from the balance sheet date are
classified as current portion of non-current liabilities. Others are classified as non-current
liabilities.
A financial liability is derecognised or partly derecognised when the underlying present
obligation is discharged or partly discharged. The difference between the carrying amount
of the derecognised part of the financial liability and the consideration paid is recognised in
profit or loss for the current period.
17
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Financial instruments (Cont'd)
(c) Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined at
the quoted price in the active market. The fair value of a financial instrument that is not
traded in an active market is determined by using a valuation technique. In valuation, the
Group adopts valuation techniques applicable in the current situation and supported by
adequate available data and other information, selects inputs with the same characteristics
as those of assets or liabilities considered in relevant transactions of assets or liabilities by
market participants, and gives priority to the use of relevant observable inputs. When
relevant observable inputs are not available or feasible, unobservable inputs are adopted.
(9) Inventories
(a) Classification
Inventories include raw materials, work in progress products, finished goods, materials in
transit, low value consumables, materials consigned for processing, etc., and are
measured at the lower of cost and net realisable value.
(b) Costing of inventories
Cost is determined using the weighted average method. The cost of finished goods and
work in progress comprise raw materials, direct labour and systematically allocated
production overhead based on the normal production capacity.
(c) Basis for determining net realisable value of inventories and method for making provision
for inventories
Provision for inventories is determined at the excess amount of the carrying amounts of the
inventories over their net realisable value. Net realisable value is determined based on the
estimated selling price in the ordinary course of business, less the estimated costs to
completion and estimated costs necessary to make the sale and related taxes.
(d) The Group adopts the perpetual inventory system.
(e) Amortisation methods of low value consumables
Low value consumables are amortised into expenses in full when issued for use.
18
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in its
subsidiaries and the Group’s long-term equity investments in its associates.
Subsidiaries are the investees over which the Company is able to exercise control.
Associates are the investees that the Group has a significant influence on their financial
and operating decisions.
Investments in subsidiaries are presented using the cost method in the Company’s
financial statements, and adjusted to the equity method when preparing the consolidated
financial statements. Investments in associates are accounted for using the equity method.
(a) Determination of investment cost
For long-term equity investments acquired through a business combination involving
enterprises under common control, the investment cost shall be the absorbing party’s
share of the carrying amount of owners’ equity of the party being absorbed in the
consolidated financial statements of the ultimate controlling party at the combination date;
for long-term equity investments acquired through a business combination not involving
enterprises under common control, the investment cost shall be the combination cost.
For long-term equity investments acquired not through a business combination, such as
long-term equity investments acquired by payment in cash, the initial investment cost shall
be the purchase price actually paid; for long-term equity investments acquired by issuing
equity securities, the initial investment cost shall be the fair value of the equity securities
issued.
(b) Subsequent measurement and recognition of profit or loss
Long-term equity investments accounted for using the cost method are measured at the
initial investment cost. Cash dividend or profit distribution declared by an investee is
recognised as investment income into profit or loss for the current period.
Where the initial investment cost exceeds the Group’s share of the fair value of the
investee’s identifiable net assets at the time of acquisition, the investment is initially
measured at that cost. Where the initial investment cost is less than the Group’s share of
the fair value of the investee’s identifiable net assets at the time of acquisition, the
difference is included in profit or loss for the current period and the cost of the long-term
equity investment is adjusted upwards accordingly.
19
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Long-term equity investments (Cont’d)
(b) Subsequent measurement and recognition of profit or loss (Cont’d)
For long-term equity investments accounted for using the equity method, the Group
recognises the investment income or losses according to its share of net profit or loss of
the investee. The Group does not recognise further losses when the carrying amounts of
the long-term equity investments together with any long-term interests that, in substance,
form part of the Group’s net investment in investees are reduced to zero. However, if the
Group has obligations for additional losses and the criteria with respect to recognition of
provisions are satisfied, the Group continues recognising the investment losses and the
provisions at the amount it expects to undertake. The Group’s share of the changes in
investee’s owner's equity other than those arising from the net profit or loss, other
comprehensive income and profit distribution is recognised in capital surplus with a
corresponding adjustment to the carrying amounts of the long-term equity investment. The
carrying amount of the investment is reduced by the Group’s share of the profit distribution
or cash dividends declared by the investees. Unrealised gains or losses on transactions
between the Group and its investees are eliminated to the extent of the Group’s equity
interest in the investees, based on which the investment income or losses are recognised.
Any losses resulting from transactions between the Group and its investees, which are
attributable to asset impairment losses are not eliminated.
(c) Basis for determining existence of control and significant influence over investees
Control is the power over investees that can bring variable returns through involvement in
related activities of investees and the ability to influence the returns by using such power
over investees.
Significant influence is the power to participate in making decisions on financial and
operating policies of investees, but is not control or joint control over making those policies.
(d) Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries and associates is
reduced to the recoverable amounts when the recoverable amounts are below their
carrying amount (Note 2(15)).
(11) Fixed assets
(a) Recognition and initial measurement of fixed assets
Fixed assets comprise buildings, machinery and equipment, motor vehicles, moulds, and
electronic and other equipment.
Fixed assets are recognised when it is probable that the related economic benefits will flow
to the Group and the costs can be reliably measured. Fixed assets purchased or
constructed by the Group are initially measured at cost at the time of acquisition. The fixed
assets contributed by the state-owned shareholders upon the restructuring of the Company
are recorded at the valued amount determined by the state-owned asset administration
department.
20
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Fixed assets (Cont’d)
(a) Recognition and initial measurement of fixed assets (Cont’d)
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed
asset when it is probable that the associated economic benefits will flow to the Group and
the related cost can be reliably measured. The carrying amount of the replaced part is
derecognised. All the other subsequent expenditures are recognised in profit or loss for the
period in which they are incurred.
(b) Depreciation methods of fixed assets
Fixed assets are depreciated using the straight-line method to allocate the cost of the
assets to their estimated net residual values over their estimated useful lives. For the fixed
assets that have been provided for impairment loss, the related depreciation charge is
prospectively determined based upon the adjusted carrying amounts over their remaining
useful lives.
The estimated useful lives, the estimated net residual values expressed as a percentage of
cost and the annual depreciation rates of fixed assets are as follows:
Estimated useful Estimated net Annual depreciation
lives residual values rates
Buildings 35 to 40 years 4% 2.4% to 2.7%
Machinery and
equipment 10 to 15 years 4% 6.4% to 9.6%
Motor vehicles 5 to 10 years 4% 9.6% to 19.2%
Moulds 5 years - 20%
Electronic and other
equipment 5 to 7 years 4% 13.7% to 19.2%
The estimated useful life and the estimated net residual value of a fixed asset and the
depreciation method applied to the asset are reviewed, and adjusted as appropriate at
each year-end.
(c) The carrying amount of a fixed asset is reduced to the recoverable amount when the
recoverable amount is below the carrying amount (Note 2(15)).
(d) Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefits are
expected from its use or disposal. The amount of proceeds from disposals on sale,
transfer, retirement or damage of a fixed asset net of its carrying amount and related taxes
and expenses is recognised in profit or loss for the current period.
21
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(12) Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises construction
costs, installation costs, borrowing costs that are eligible for capitalisation and other costs
necessary to bring the fixed assets ready for their intended use. Construction in progress is
transferred to fixed assets when the assets are ready for their intended use, and
depreciation is charged starting from the next month. The carrying amount of construction
in progress is reduced to the recoverable amount when the recoverable amount is below
the carrying amount (Note 2(15)).
(13) Borrowing costs
The borrowing costs that are directly attributable to acquisition and construction of an asset
that needs a substantially long period of time for its intended use commence to be
capitalised and recorded as part of the cost of the asset when expenditures for the asset
and borrowing costs have been incurred, and the activities relating to the acquisition and
construction that are necessary to prepare the asset for its intended use have commenced.
The capitalisation of borrowing costs ceases when the asset under acquisition or
construction becomes ready for its intended use and the borrowing costs incurred
thereafter are recognised in profit or loss for the current period. Capitalisation of borrowing
costs is suspended during periods in which the acquisition or construction of an asset is
interrupted abnormally, and the interruption lasts for more than 3 months, until the
acquisition or construction is resumed.
The capitalised amount of specific borrowings intended to be used for the acquisition or
construction of qualifying assets is determined by the interest expenses incurred in the
period less interest income of the unused borrowings deposited at bank or investment
income from temporary investments.
The capitalised amount of general borrowings intended to be used for the acquisition or
construction of qualifying assets is determined by the weighted average of the excess of
accumulated capital expenditure over capital expenditure of the special borrowings
multiplied by the weighted average effective interest rate of the utilised general borrowings.
The effective interest rate is the rate at which the future cash flows of the borrowings over
the expected lifetime or a shorter applicable period are discounted into the initial
recognised amount of the borrowings.
(14) Intangible assets
Intangible assets include land use rights, software use fees, non-patent technologies and
after-sales service management mode, and are measured at cost.
(a) Land use rights
Land use rights are amortised on the straight-line basis over their approved use period of
50 years. If the acquisition costs of the land use rights and the buildings located thereon
cannot be reasonably allocated between the land use rights and the buildings, all of the
acquisition costs are recognised as fixed assets.
22
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(14) Intangible assets (Cont’d)
(b) Software use fees
Software use fees are amortised on a straight-line basis over the estimated useful life of 5
years.
(c) Non-patent technologies
Non-patent technologies are amortised on the straight-line basis over the useful life of 5
years.
(d) Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review of its useful life and amortisation
method is performed at each year-end, with adjustment made appropriately.
(e) Research and development
The expenditure on an internal research and development project is classified into
expenditure on the research phase and expenditure on the development phase based on
its nature and whether there is material uncertainty that the research and development
activities can form an intangible asset at the end of the project.
Expenditure on the research phase related to planned survey, evaluation and selection for
research on manufacturing technique of automobile products is recognised in profit or loss
in the period in which it is incurred. Prior to mass production, expenditure on the
development phase related to the design and testing phase in regards to the final
application of manufacturing technique of automobile products is capitalised only if all of
the following conditions are satisfied:
the development of manufacturing technique of automobile products has been fully
demonstrated by technical team;
management intends to complete the development of manufacturing technique of
automobile products, and use or sell it;
the research and analysis of preliminary market survey indicate that products
manufactured with manufacturing technique of automobile products are
marketable;
adequate technical and financial supports are available for development of
manufacturing techniques of automobile products and subsequent mass
production; and,
expenditure on development of manufacturing techniques of automobile products
can be reliably collected.
Other expenditures on the development phase that do not meet the conditions above are
recognised in profit or loss in the period in which they are incurred. Development
expenditures previously recognised as profit or loss are not recognised as an asset in a
subsequent period. Capitalised expenditure on the development phase is presented as
development expenditures in the balance sheet and transferred to intangible assets at the
date when the asset is ready for its intended use.
(f) Impairment of intangible assets
23
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
The carrying amounts of intangible assets are reduced to the recoverable amounts when
the recoverable amounts are below their carrying amounts (Note 2(15)).
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(15) Impairment of long-term assets
Fixed assets, construction in progress, right-of-use assets, intangible assets with finite
useful lives and long-term equity investments in subsidiaries and associates are tested for
impairment if there is any indication that the assets may be impaired at the balance sheet
date; intangible assets that are not yet available for their intended use are tested for
impairment at least once a year, irrespective of whether there is any indication of
impairment. If the result of the impairment test indicates that the recoverable amount of an
asset is less than its carrying amount, a provision for impairment and an asset impairment
loss are recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less
disposal costs and the present value of the future cash flows expected to be derived from
the asset. Provision for asset impairment is determined and recognised on the individual
asset basis. If it is not possible to estimate the recoverable amount of an individual asset,
the recoverable amount of a group of assets to which the asset belongs is determined. A
group of assets is the smallest group of assets that is able to generate independent cash
inflows.
Goodwill that is separately presented in the financial statements is tested at least once a
year for impairment, irrespective of whether there is any indication that it may be impaired.
In conducting the test, the carrying amount of goodwill is allocated to the related asset
group or groups of asset groups which are expected to benefit from the synergies of the
business combination. If the result of the test indicates that the recoverable amount of an
asset group or a group of asset groups, including the allocated goodwill, is lower than its
carrying amount, the corresponding impairment loss is recognised. The impairment loss is
first deducted from the carrying amount of goodwill that is allocated to the asset group or
group of asset groups, and then deducted from the carrying amounts of other assets within
the asset group or group of asset groups in proportion to the carrying amounts of assets
other than goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the value
recovered in the subsequent periods.
(16) Employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Group
in exchange for service rendered by employees or for termination of employment
relationship, which include short-term employee benefits, post-employment benefits and
termination benefits.
(a) Short-term employee benefits
Short-term employee benefits include wages or salaries, bonus, allowances and subsidies,
staff welfare, premiums or contributions on medical insurance, work injury insurance and
maternity insurance, housing funds, union running costs and employee education costs,
short-term paid absences, etc. The short-term employee benefits actually occurred are
recognised as a liability in the accounting period in which the service is rendered by the
employees, with a corresponding charge to the profit or loss for the current period or the
cost of relevant assets. Non-monetary benefits are measured at fair value.
24
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Employee benefits (Cont'd)
(b) Post-employment benefits
The Group classifies post-employment benefit plans as either defined contribution plans or
defined benefit plans. Defined contribution plans are post-employment benefit plans under
which the Group pays fixed contributions into a separate fund and will have no obligation to
pay further contributions; and defined benefit plans are post-employment benefit plans
other than defined contribution plans. During the reporting period, premiums or
contributions on basic pensions and unemployment insurance paid for employees belong
to defined contribution plans; supplementary retirement benefits for employees are defined
benefit plans.
(i) Defined contribution plans
Basic pensions
The Group’s employees participate in the basic pension plan set up and administered by
local authorities of the Ministry of Human Resources and Social Security. Monthly
payments of premiums on the basic pensions are calculated according to the bases and
percentage prescribed by the relevant local authorities. When employees retire, the
relevant local authorities are obliged to pay the basic pensions to them. The amounts
based on the above calculations are recognised as liabilities in the accounting period in
which the service has been rendered by the employees, with a corresponding charge to
the profit or loss for the current period or the cost of relevant assets.
(ii) Defined benefit plans
The Group also provides employees with supplementary retirement benefits in addition to
the insurance system prescribed by the State. Such supplementary retirement benefits
belong to defined benefit plans. The defined benefit liabilities recognised on the balance
sheet represent the present value of defined benefit obligations less the fair value of the
plan assets. The defined benefit obligations are calculated annually by an independent
actuary using projected unit credit method at the interest rate of national debt with similar
obligation term and currency. Service costs related to supplementary retirement benefits
(including current service costs, historical service costs and settled gains or losses) and
net interest are recognised in profit or loss for the current period or the cost of related
assets, and changes arising from remeasurement of net liabilities or net assets of defined
benefit plans are recognised in other comprehensive income.
(c) Termination benefits
The Group provides compensation for terminating the employment relationship with
employees before the end of the employment contracts or as an offer to encourage
employees to accept voluntary redundancy before the end of the employment contracts.
The Group recognises a liability arising from compensation for termination of the
employment relationship with employees, with a corresponding charge to profit or loss for
the current period at the earlier of the following dates: 1) when the Group cannot
unilaterally withdraw an employment termination plan or a curtailment proposal; 2) when
the Group recognises costs or expenses for a restructuring that involves the payment of
termination benefits.
25
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Employee benefits (Cont'd)
(c) Termination benefits (Cont’d)
Early retirement benefits
The Group offers early retirement benefits to those employees who accept early retirement
arrangements. The early retirement benefits refer to the salaries and social security
contributions to be paid to and for the employees who accept voluntary retirement before
the normal retirement date prescribed by the State, as approved by the management. The
Group pays early retirement benefits to those early retired employees from the early
retirement date until the normal retirement date. The Group accounts for the early
retirement benefits in accordance with the treatment for termination benefits, in which the
salaries and social security contributions to be paid to and for the early retired employees
from the off-duty date to the normal retirement date are recognised as liabilities with a
corresponding charge to the profit or loss for the current period. The differences arising
from the changes in the respective actuarial assumptions of the early retirement benefits
and the adjustments of benefit standards are recognised in profit or loss in the period in
which they occur.
The termination benefits expected to be paid within one year since the balance sheet date
are classified as employee benefits payable.
(17) Dividend distribution
Cash dividends are recognised as liabilities in the period in which the dividends are
approved at the shareholders’ meeting.
(18) Provisions
Provisions for product warranties, compensation to suppliers, etc. are recognised when the
Group has a present obligation, it is probable that an outflow of economic benefits will be
required to settle the obligation, and the amount of the obligation can be measured reliably.
A provision is initially measured at the best estimate of the expenditure required to settle
the related present obligation. Factors on a contingency, such as the risks, uncertainties
and the time value of money, are taken into account as a whole in reaching the best
estimate of a provision. Where the effect of the time value of money is material, the best
estimate is determined by discounting the related future cash outflows. The increase in the
discounted amount of the provision arising from passage of time is recognised as interest
expense.
The carrying amount of provisions is reviewed at each balance sheet date and adjusted to
reflect the current best estimate.
The provisions expected to be settled within one year since the balance sheet date are
classified as current liabilities.
26
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(19) Revenue
The Group manufactures automobiles and automobile parts and sells them to distributors
and end customers. In addition, the Group also provides customers with auto maintenance
and additional quality warranty services. The Group recognises revenue at the amount of
the consideration that is entitled to be charged by the Group as expected when the
customer obtains control over relevant goods or services.
(a) Selling automobiles and automobile parts to distributors and end customers
The Group manufactures automobiles and automobile parts and sells such products to
distributors and end customers. The Group recognises revenue from sales of automobiles
after they are delivered as prescribed in the contract, customers have accepted the
products and the delivery documents have been signed by both parties. The Group
recognises revenue from sales of parts after they are delivered to the designated location
as prescribed in the contract, customers have accepted the products and the delivery
documents have been signed by both parties.
Where two or more obligations are included in a contract between the Group and the
customers, at the beginning date of the contract, the Group allocates the transaction price
to individual obligation in the relative proportion to the individual selling prices of products
or services committed in each individual obligation. When the individual selling price is
unobservable, the Group makes reasonable estimates on the individual selling price with
comprehensive consideration to all available information, and by using market adjustment
method, cost plus method, etc.
The credit periods granted by the Group to distributors and end customers are generally
within one year and no more than two years, which is consistent with the industry practice,
and there is no significant financing component. The Group provides product warranties for
automobiles and automobile parts as required by laws and regulations, and recognises the
corresponding provisions (Note 2(18)).
The Group provides distributors and end customers with sales discounts based on sales
volume, and related revenue is recognised at contract consideration net of the discount
amount estimated based on historical experience and using the expected value method.
(b) Rendering of services
The Group provides customers with car maintenance and additional quality assurance
services, and recognizes revenue within a period of time based on the progress of the
performance of the services provided. According to the nature of the service provided, the
performance progress is determined in accordance with the value of the labour provided to
the customer to the customer or the cost of the provided labour to the total labour cost.
When the Group recognises revenue based on the stage of completion, the amount with
unconditional collection right obtained by the Group is recognised as accounts receivable,
and the rest is recognised as contract assets. Meanwhile, loss provision for accounts
receivable and contract assets are recognised on the basis of ECL (Note 2(8)). If the
contract price received or receivable exceeds the amount for the completed service, the
excess portion will be recognised as contract liabilities. Contract assets and contract
liabilities under the same contract are presented on a net basis.
27
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(20) Government grants
Government grants refer to the monetary or non-monetary assets obtained by the Group
from the government, including support funds for enterprise development, financial
subsidies, etc.
Government grants are recognised when the grants can be received and the Group can
comply with all attached conditions. If a government grant is a monetary asset, it will be
measured at the amount received or receivable. If a government grant is a non-monetary
asset, it will be measured at its fair value. If it is unable to obtain its fair value reliably, it will
be measured at its nominal amount.
Government grants related to assets refer to government grants which are obtained by the
Group for the purposes of purchase, construction or acquisition of the long-term assets.
Government grants related to income refer to the government grants other than those
related to assets.
Government grants related to assets are recorded as deferred income and recognised in
profit or loss on a reasonable and systemic basis over the useful lives of the assets.
Government grants related to income that compensate future costs, expenses or losses
are recorded as deferred income and recognised in profit or loss; government grants
related to income that compensate incurred costs, expenses or losses are recognised in
profit or loss directly for the current period.
The Group adopts the same presentation method for similar government grants.
Government grants related to ordinary activities are included in operating profit. Otherwise,
they are recorded in non-operating income.
Financial discounts directly received by the Group are deducted against related borrowing
costs.
28
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(21) Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on the
differences arising between the tax bases of assets and liabilities and their carrying
amounts (temporary differences). Deferred tax asset is recognised for the deductible
losses that can be carried forward to subsequent years for deduction of the taxable profit in
accordance with the tax laws. No deferred tax liability is recognised for a temporary
difference arising from the initial recognition of goodwill. No deferred tax asset or deferred
tax liability is recognised for the temporary differences resulting from the initial recognition
of assets or liabilities due to a transaction other than a business combination, which affects
neither accounting profit nor taxable profit (or deductible losses). At the balance sheet
date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is settled.
Deferred tax assets are only recognised for deductible temporary differences, deductible
losses and tax credits to the extent that it is probable that taxable profit will be available in
the future against which the deductible temporary differences, deductible losses and tax
credits can be utilised.
Deferred tax liabilities are recognised for taxable temporary differences arising from
investments in subsidiaries and associates, except where the Group is able to control the
timing of reversal of such temporary differences, and it is probable that the temporary
differences will not reverse in the foreseeable future. When it is probable that the
deductible temporary differences arising from investments in subsidiaries and associates
will be reversed in the foreseeable future and that the taxable profit will be available in the
future against which the deductible temporary differences can be utilised, the
corresponding deferred tax assets are recognised.
Deferred tax assets and deferred tax liabilities are offset when:
the deferred tax assets and deferred tax liabilities are related to the same tax
payer within the Group and the same taxation authority; and,
that tax payer within the Group has a legally enforceable right to offset current tax
assets against current tax liabilities.
29
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(22) Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for consideration.
The Group as the lessee
At the commencement date, the Group shall recognise the right-of-use asset and measure
the lease liabilities at the present value of the lease payments that are not paid at that
date. Lease payments include fixed payments, the exercise price of a purchase option if
the lessee is reasonably certain to exercise that option, and payments of penalties for
terminating the lease if the lessee exercises an option to terminate the lease. Variable
lease payments in proportion to sales are excluded from lease payments and recognised
in profit or loss as incurred. Lease liabilities that are due within one year (inclusive) as from
the balance sheet date are included in the current portion of non-current liabilities.
The Group's right-of-use assets represent leased buildings. Right-of-use assets are
measured initially at cost which comprises the amount of the initial measurement of lease
liabilities, any lease payments made at or before the commencement date and any initially
direct costs, less any lease incentives received. If it is reasonably probable that the Group
will obtain ownership of the underlying asset by the end of the lease term, the asset is
depreciated over its remaining useful life; otherwise the asset is depreciated over the
shorter of the lease term and its remaining useful life. The carrying amounts of the right-of-
use assets are reduced to the recoverable amounts when the recoverable amounts are
below their carrying amounts (Note 2(15)).
For short-term leases with a term of 12 months or less and leases of an individual asset
(when new) of low value, the Group may, instead of recognising right-of-use assets and
lease liabilities, recognise the lease payments in the cost of the underlying assets or in
profit or loss for the current period on a straight-line basis over the lease term.
The Group shall account for a lease modification as a separate lease if both: (1) the
modification extends the scope of the lease by adding the right to use one or more
underlying assets; (2) the increased consideration is equivalent to the amount of the
individual price of the expanded part of the lease scope adjusted according to the contract
conditions.
For a lease modification that is not accounted for as a separate lease, the Group shall
redetermine the lease term at the effective date of the lease modification, and remeasure
the lease liability by discounting the revised lease payments using a revised discount rate,
except for the simplified method for contract changes directly caused by COVID-19. For a
lease modification which narrows the scope of the lease or shortens the lease term, the
Group decreases the carrying amount of the right-of-use asset, and recognises in profit or
loss any gain or loss relating to the partial or full termination of the lease. For other
changes which lead to the remeasurement of lease liabilities, the Group correspondingly
adjusts the carrying amount of the right-of-use asset.
For the rental waivers due to COVID-19 and for the period ended before 30 June 2021
only, the Group applies the simplified method, records the undiscounted waivers in profit or
loss and adjusts lease liability when the agreement is reached to dismiss the original
payment obligation.
30
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(22) Leases (Cont’d)
The Group as the lessor
A lease is classified as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership of an underlying asset. An operating lease is a lease other than a
finance lease.
As a lessor, the Group has no financing liabilities. When the Group leases free buildings,
the rental income from operating leases is recognized on a straight-line basis during the
lease term.
(23) Segment information
The Group identifies operating segments based on the internal organisation structure,
management requirements and internal reporting system, and discloses segment
information of reportable segments on the basis of operating segments.
An operating segment is a component of the Group that satisfies all of the following
conditions: (1) the component is able to earn revenues and incur expenses from its
ordinary activities; (2) whose operating results are regularly reviewed by the Group’s
management to make decisions about resources to be allocated to the segment and to
assess its performance, and (3) for which the information on financial position, operating
results and cash flows is available to the Group. Two or more operating segments that
have similar economic characteristics and satisfy certain conditions can be aggregated into
one single operating segment.
31
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements
The Group continually evaluates the critical accounting estimates and key judgements
applied based on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
(a) Critical judgements on applying the accounting policies
(i) Classification of financial assets
Significant judgements made by the Group in the classification of financial assets include
business model and analysis on contractual cash flow characteristics.
The Group determines the business model for financial assets management on the group
basis, and factors to be considered include the methods for evaluating the financial assets
performance and reporting such performance to key management personnel, the risks
relating to the financial assets performance and corresponding management methods, the
ways in which related business management personnel are remunerated, etc.
When assessing whether contractual cash flow characteristics of financial assets are
consistent with basic lending arrangement, key judgements made by the Group include:
the possibility of changes in time schedule or amount of the principal during the lifetime
due to reasons such as repayment in advance; whether interest only includes time value of
money, credit risk, other basic lending risks and considerations for costs and profits. For
example, whether the repayment in advance only reflects the principal outstanding and
corresponding interest and reasonable compensation paid for early termination of the
contract.
(ii) Judgement on significant increase in credit risk
Judgement made by the Group for significant increase in credit risk is mainly based on
whether the overdue days exceed 30 days, or whether one or more of the following
indicators change significantly: business environment of the debtor, internal and external
credit rating, significant changes in actual or expected operating results, significant
decrease in value of collateral or credit rate of guarantor, etc.
Judgement made by the Group for the occurrence of credit impairment is mainly based on
whether the overdue days exceed 90 days (i.e., a default has occurred), or whether one or
more of the following conditions is/are satisfied: the debtor is suffering significant financial
difficulties, the debtor is undergoing other debt restructuring, or the debtor probably goes
bankrupt, etc.
32
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(a) Critical judgements in applying the accounting policies (Cont’d)
(iii) Judgement on capitalisation of development expenditures
Development expenditures are capitalised when the criteria in Note 2(14)(e) are fulfilled.
The assessments on whether the criteria for capitalisation of development expenditures
have been met involve judgements of the Group, including the technical feasibility of the
project, the likelihood of the project generating sufficient future economic benefits and the
timing to start capitalisation particularly. The Group makes the judgements on the
capitalisation of development expenditures and records the process in meeting minutes
based on feasibility analysis, regular review on the development project phase, etc.
(iv) Timing of revenue recognition
The Group sells automobiles and automobile parts to distributors or end customers. The
Group recognises revenue from sales of automobiles after they are delivered as prescribed
in the contract, distributors or end customers have accepted the products and the delivery
documents have been signed by both parties. The Group recognises revenue from sales of
parts after they are delivered to the designated location as prescribed in the contract,
distributors or end customers have accepted the products and the delivery documents are
signed by both parties. Thereafter, the distributors or end customers own the products,
have the right to set prices independently, and bear the risks from price fluctuation or
damage of the products. The distributors or end customers have obtained the control of the
products after accepting the products. Therefore, the Group recognises the sales revenue
of the products at the time when the delivery documents have been signed.
(v) Sales with product warranties
The Group provides statutory warranty for automobiles and automobile parts, and the
periods and terms of such warranty comply with the requirements of laws and regulations
related to the products. The Group does not provide any significant additional service or
additional warranty for this purpose, thus this kind of warranty cannot be identified as a
separate performance obligation. In addition, the Group also offers additional warranty
other than the requirements of laws and regulations, which is identified as a separate
performance obligation. The Group recognises the revenue of the additional warranty over
time during the period when services are rendered.
33
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions
The critical accounting estimates and key assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the
next fiscal year are outlined below:
(i) Measurement of ECL
The Group calculates ECL through default risk exposure and ECL rate, and determines
the ECL rate based on default probability and default loss rate. In determining the ECL
rate, the Group uses data such as internal historical credit loss experience, etc., and
adjusts historical data based on current conditions and forward-looking information.
When considering forward-looking information, the Group considers different
macroeconomic scenarios. In the first half of 2021, the weights of “base”, “bad” and
“good” are 68%, 16% and 16% under three economic scenarios respectively for the
consideration of forward-looking information. The Group regularly monitors and reviews
important macroeconomic assumptions and parameters related to the calculation of ECL
rate, including the risks of economic downturn, external market environment, changes of
technological environment and customer, gross domestic product and money supply etc.
In the first half of 2021, the Group has considered the uncertainty caused by the COVID-
19 and updated relevant assumptions and parameters accordingly. The key
macroeconomic parameters used in each scenario are listed as follows:
Scenarios
Base Bad Good
Gross domestic product 14.25% 14.15% 14.34%
Money supply 9.20% 7.72% 10.68%
34
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(ii) Impairment of long-term assets
The Group assesses whether there is any indication that non-current assets other than
financial assets may be impaired at the balance sheet date. When there are indications
showing the carrying amounts of such assets cannot be recovered, an impairment test will
be performed.
When the carrying amount of non-current assets or asset groups other than financial
assets is higher than the recoverable amount, which is the higher of an asset’s fair value
less disposal costs and the present value of the future cash flows expected to be derived
from the asset, it shows non-current assets or asset groups are impaired.
The amount of an asset’s fair value less disposal costs was determined by the price of a
sale agreement in a fair trade, less the costs that are directly attributable to the disposal of
the asset. Where there is no sales agreement but there is an active market of assets, the
amount is determined by the market price less the costs that are directly attributable to the
disposal of the asset. The market price of assets is determined by the considerations
provided by the buyer. Where there is no sales agreement or active market of assets, the
amount of an asset’s fair value less disposal costs was determined based on the best
information available, with reference to the latest transaction price or results of similar
assets of the same industry.
Disposal costs include legal cost, taxes and handling fee related to asset disposal, and
direct costs incurred to bring the assets to a saleable state..
35
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(iii) Income tax and deferred income tax
The Group is subject to enterprise income tax in multiple regions. There are some
transactions and events for which the ultimate tax treatment is uncertain during the
ordinary course of business. Significant judgement is required from the Group in
determining the provision for income taxes in each of these regions. Where the final tax
outcome of these matters is different from the amounts that were initially recorded, such
differences will impact the income tax and deferred tax provisions in the period in which
such determination is made.
As stated in Note 3(2), the Company is a high-tech enterprise. The “High-Tech Enterprise
Certificate” is effective for three years. Upon expiration, application for high-tech enterprise
assessment should be submitted again to the relevant government authorities. Based on
the past experience of reassessment for high-tech enterprise upon expiration and its actual
conditions, the Company considers that it is able to obtain the qualification for high-tech
enterprises in the next 3 years, and therefore a preferential tax rate of 15% is used to
calculate the corresponding deferred income tax. If the Company cannot obtain the
qualification for high-tech enterprise upon expiration, the Company is subject to a statutory
tax rate of 25% for the calculation of income tax, which further influences the recognised
deferred tax assets, deferred tax liabilities and income tax expenses.
Deferred tax assets are recognised for the deductible tax losses that can be carried
forward to subsequent years to the extent that it is probable that taxable profit will be
available in the future against which the deductible tax losses can be utilised. Taxable
profit that will be available in the future includes the taxable profit that will be realised
through ordinary course of business and the taxable profit that will be increased upon the
reversal of taxable temporary differences incurred in prior periods. Judgements and
estimates are required to determine the time and amounts of taxable profit in the future.
Any difference between the reality and the estimate may result in adjustment to the
carrying amount of deferred tax assets.
(iv) Provisions
The Group undertakes after-sales repair or replacement obligations for automobiles sold
based on the after-sales service agreement. Management estimates related provisions
based on historical after-sales service data, including the repair and replacement provided
as well as current trends.
Factors that may impact the estimation of warranty costs include improvement of the
Group’s productivity and production quality, as well as changes in related parts and labour
costs. Any increase or decrease in provisions will have impact on profit or loss of the
Group in the future.
36
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Critical accounting estimates and judgements (Cont’d)
(b) Critical accounting estimates and key assumptions (Cont’d)
(v) Provision for inventories
The Group's inventories are stated at the lower of cost and net realisable value. Net
realisable value of inventories is the amount of the estimated selling price in the ordinary
course of business, less the estimated costs to completion and estimated costs necessary
to make the sales and related taxes.
If the management revises the estimated selling price of the inventory, the estimated costs
to be incurred by the time of completion, and the estimated selling expenses and related
taxes, the revised estimated selling price is lower than the currently adopted estimated
selling price, or the revised until The estimated costs, estimated sales expenses, and
related taxes and fees at the completion of the project are higher than the currently
adopted estimates, the Group needs to make provision for inventory.
If the actual selling prices, costs to completion, selling and distribution expenses and
related taxes are higher or lower than management’s estimates, the Group shall recognise
the relevant differences in the consolidated income statement during the corresponding
accounting period.
37
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
3 Taxation
(1) The main categories and rates of taxes applicable to the Group are set out below:
Category Taxation basis Tax rate
Corporate income tax (a) Taxable income 15% and 25%
VAT (b) Taxable value-added amount (Tax 13%, 9% and 6%
payable is calculated by multiplying the
taxable sales amount by the applicable
tax rate less deductible input VAT of
the current period)
Consumption tax (c) Taxable sales amount 3%, 5% and 9%
City maintenance and The payment amount of VAT and 5% and 7%
construction tax (d) consumption tax
(a) Pursuant to the Circular on Enterprise Income Tax Policy Concerning Deductions for
Equipment and Appliances (Cai Shui [2018] No. 54) and An announcement on extending
the period of implementation of some preferential tax policies (Cai Shui [2021] No. 06)
relevant regulations issued by the State Taxation Administration, during the period from 1
January 2018 to 30 June 2021, the cost of newly purchased equipment with the original
cost less than RMB5 million can be fully deducted against taxable profit in the next month
after the asset is put into use, instead of being depreciated annually for tax filing.
Pursuant to the Circular on further Increasing the Pre-tax Deduction for Research and
Development Expenses (Cai Shui [2021] No. 13) issued by the Ministry of Finance, the
State Taxation Administration and the Ministry of Science and Technology and relevant
regulations, during the period from 1 January 2021 to 30 June 2021, the Groups’ actual
research and development expenses that are not recognised as intangible assets but
included in profit or loss are allowed to 100% pre-tax additional deduction; those expenses
recognised as intangible assets can be amortised before tax at 200% of the costs of
intangible assets.
(b) Pursuant to the Announcement on Relevant Policies for Deepening Value-Added Tax
Reform (Announcement [2019] No. 39) and relevant regulations jointly issued by the
Ministry of Finance, the State Taxation Administration and the General Administration of
Customs, the Group’s taxable products sales revenue is subject to the VAT at the rate of
13%. The Group's real estate leasing business is subject to the VAT at the rate of 9%.
The interest income from its wholly-owned subsidiaries is subject to VAT at the rate of 6%.
(c) Pursuant to the Interim Regulations of the People's Republic of China on Consumption Tax
promulgated by the State Council (Order No. 539 of the State Council of the People's
Republic of China) and the Notice of Ministry of Finance and State Taxation Administration
on Adjusting Consumption Tax Policies for Passenger Cars (Cai Shui [2008] No. 105), the
consumption tax rates of the Group's taxable products are 3%, 5% and 9%.
38
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
3 Taxation (Cont’d)
(1) The main categories and rates of taxes applicable to the Group are set out below(Cont’d):
(d) Pursuant to the Circular of the State Council on Unifying the Collection of City Construction
and Maintenance Tax and Educational Surcharge on Domestic and Foreign-Owned
Enterprises and Individuals (Guo Fa [2010] No. 35) issued by the State Council, the Group
is subject to city construction and maintenance tax at the rates of 5% and 7%.
(2) Tax preference
Pursuant to the Circular of Jiangxi High-Tech Enterprise Certification Leading Group on the
Announcement of the First Batch of High-Tech Enterprises of Jiangxi Province for the year
2018 (Gan Gao Qi Ren Fa [2018] No. 3), the Company is certified as a high-tech
enterprise, and the valid term is three years. During the period from 1 January 2018 to 31
December 2020, the Company was subject to enterprise income tax at the rate of 15%. At
present, the company is re-identified as a high-tech enterprise.
In 2021, except for the Company, the Company’s wholly-owned companies, including JMC
Heavy Duty Vehicle Co., Ltd. (“JMCH”), Taiyuan Jiangling Motive Power Co., Ltd.
(“JMPC”), Jiangling Motor Sales Co., Ltd. (“JMCS”), Shenzhen Fujiang New Energy
Automobile Sales Co., Ltd. (“SZFJ”), and Guangzhou Fujiang New Energy Automobile
Sales Co., Ltd. (“GZFJ”),were subject to the enterprise income tax at the rate of 25%.
39
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements
(1) Cash and cash equivalents
30 June 2021 31 December 2020
Bank balances (a) 10,948,621,070 11,121,955,129
Other cash and cash equivalents (b) 1,565,665 -
10,950,186,735 11,121,955,129
(a) As at 30 June 2021, cash at bank of the Group deposited with Jiangling Motor Group
Finance Company (“JMCF”) was RMB771,587,928 (31 December 2020:
RMB1,231,825,734) (Note 7(6)), and interest was calculated at 1.725% to 2.25% (2020:
0.455% to 3.30%) per annum, which was the interest rate applied to deposits with the
same term.
JMCF, a holding subsidiary of Jiangling Motors Group Co., Ltd (“JMCG”), is a non-banking
financial institution. JMCG holds 50% equity capital of Nanchang Jiangling Investment Co.,
Ltd. (“JIC”), a main shareholder of the Company.
(b) As at 30 June 2021, Other cash and cash equivalents of RMB 1,565,665 (December 31,
2020: none) are margin deposits deposited for the Group to apply to the bank for the
issuance of bank acceptance drafts.
(2) Financial assets held for trading
30 June 2021 31 December 2020
Structured Deposits 553,211,507 803,892,985
(3) Accounts receivable
30 June 2021 31 December 2020
Accounts receivable 3,628,257,248 3,233,785,212
Less: Provision for bad debts (226,335,444) (233,902,000)
3,401,921,804 2,999,883,212
40
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(3) Accounts receivable (Cont’d)
(a) The ageing of accounts receivable is analysed as follows:
30 June 2021 31 December 2020
Within 1 year 3,030,225,204 2,729,338,870
1 to 2 years 148,995,102 18,746,837
2 to 3 years 404,147,862 477,066,625
Over 3 years 44,889,080 8,632,880
3,628,257,248 3,233,785,212
(b) As at 30 June 2021, the five largest accounts receivable aggregated by debtor were
analysed as follows:
Amount of
provision for % of total
Balance bad debts balance
Company 1 869,532,495 (528,716) 23.97%
Company 2 151,108,994 (844,088) 4.16%
Company 3 143,474,765 (63,138) 3.95%
Company 4 141,613,288 (76,656) 3.90%
Company 5 90,840,644 (39,304) 2.50%
1,396,570,186 (1,551,902) 38.48%
(c) Provision for bad debts
For accounts receivable, the Group measures the loss provision based on the lifetime ECL
regardless of whether there is a significant financing component.
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
New energy subsidies
receivable i) 103,180,418 100% (103,180,418)
Receivables for automobiles
ii) 81,112,880 100% (81,112,880)
184,293,298 (184,293,298)
41
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(3) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows (Cont’d):
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
New energy subsidies
receivable i) 103,180,418 100% (103,180,418)
Receivables for automobiles
ii) 83,112,880 100% (83,112,880)
186,293,298 (186,293,298)
i) As at 30 June 2021, government subsidies receivable for new energy automobiles
amounted to RMB103,180,418 (31 December 2020: RMB103,180,418). As the
corresponding new energy vehicles may not meet the corresponding subsidy policy
standards, the Group considered the receivables cannot be collected, therefore, full
provision was made for those receivables.
ii) As at 30 June 2021 and 31 December 2020, since aforesaid companies in debts had
difficulties in operation and were involved in several legal proceedings, the Group
considered the receivables cannot be collected, therefore, full provision was made for
those receivables.
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows:
Grouping - Sales of general automobiles:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 2,634,165,630 0.04% (1,151,080)
Overdue for 1 to 30 days 179,467,156 0.04% (79,794)
Overdue for 31 to 60 days 3,750,054 1.60% (59,944)
Overdue for 61 to 90 days 2,932,562 2.52% (73,907)
Overdue over 90 days 10,095,272 8.83% (891,821)
2,830,410,674 (2,256,546)
42
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(3) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Sales of general automobiles (Cont’d):
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 2,092,329,084 0.21% (4,395,983)
Overdue for 1 to 30 days 262,730,035 0.21% (551,996)
Overdue for 31 to 60 days 345,798 6.35% (21,961)
Overdue for 61 to 90 days 1,936,800 10.74% (208,085)
Overdue over 90 days 17,757,747 17.59% (3,123,783)
2,375,099,464 (8,301,808)
Grouping - Sales of new energy automobiles:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 122,873,663 5.01% (6,160,075)
Overdue for 1 to 30 days - — -
Overdue for 31 to 60 days - — -
Overdue for 61 to 90 days - — -
Overdue over 90 days 155,710,138 21.05% (32,783,514)
278,583,801 (38,943,589)
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 149,343,763 6.28% (9,378,788)
Overdue for 1 to 30 days - — -
Overdue for 31 to 60 days 194,083,088 14.52% (28,173,753)
Overdue for 61 to 90 days - — -
Overdue over 90 days 3,993,700 16.25% (649,037)
347,420,551 (38,201,578)
43
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(3) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - Spare parts:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 334,969,475 0.25% (842,011)
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 288,024,625 0.30% (864,074)
Overdue for 1 to 30 days 21,425,030 0.30% (64,275)
Overdue for 31 to 60 days 11,544,651 0.50% (57,723)
Overdue for 61 to 90 days 1,809,917 0.60% (10,860)
Overdue over 90 days 2,167,676 5.00% (108,384)
324,971,899 (1,105,316)
(iii) For the six months ended 30 June 2021, The provision for bad debts amounted to
RMB7,566,557 was reversed. The significant amounts collected or reversed were as
follows:
Basis and justification for Amount of
Reasons for determining the provision for reversal/ Recovery
reversal/recovery bad debts recovery method
Accounts receivable 1 The actual receipt of The aforesaid companies in 2,000,000 Received
account receivables debts had difficulties in
relating to the provision operation and were involved
for bad debts made in in several legal
the prior period. proceedings, the Group
considered the receivables
cannot be collected,
therefore, full provision was
made for those receivables.
(d) For the six months ended 30 June 2021, The group has no actual write-off accounts
receivable.
e) As at 30 June 2021 and 31 December 2020, there were no accounts receivable pledged.
44
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Financing receivables
30 June 2021 31 December 2020
Financing receivables 428,573,213 815,583,669
The Group endorses the notes receivable as required by daily fund management, which
also met the criteria for derecognition, and therefore classified those notes receivable as
financial assets at fair value through other comprehensive income.
The Group had no notes receivable for which the provision for impairment was made on
the individual basis, and measured provision for bad debts based on the lifetime ECL. As
at 30 June 2021 and 31 December 2020, the acceptors of the Groups’ notes receivable
were mainly four major state-owned banks or national joint-stock banks. Therefore, the
Group expected there was no significant loss on related bank acceptance notes arising
from non-performance by these banks.
As at 30 June 2021, the Group had no bank acceptance notes receivable that have been
endorsed or discounted but not yet matured presented in financing receivables.
As at 30 June 2021, the notes receivables were endorsed or discounted by the Group but
not matured as follows:
Derecognised Not derecognised
Bank acceptance notes 821,924,876 -
(5) Advances to suppliers
(a) The ageing of advances to suppliers is analysed below:
30 June 2021 31 December 2020
% of total % of total
Amount balance Amount balance
Within 1 year 579,396,268 100% 452,714,683 100%
(b) As at 30 June 2021, the five largest advances to suppliers aggregated by debtor were
analysed as follows:
Amount % of total balance
Company 1 489,145,695 84.42%
Company 2 57,098,374 9.85%
Company 3 13,333,848 2.30%
Company 4 8,432,977 1.46%
Company 5 3,343,681 0.58%
571,354,575 98.61%
45
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(6) Other receivables
30 June 2021 31 December 2020
Interest receivable from cash at bank 85,462,590 60,283,645
Import working capital advances 25,000,000 35,000,000
Advances for gas fee 14,376,238 7,367,141
Deposits receivable 8,977,131 7,152,745
Advances for research and
development projects 5,160,914 4,559,669
Cash advance 796,203 761,613
Others 76,801,941 14,082,669
216,575,017 129,207,482
Less: Provision for bad debts (395,088) (217,909)
216,179,929 128,989,573
(a) The ageing of other receivables is analysed as follows:
30 June 2021 31 December 2020
Within 1 year 211,315,522 128,336,086
Over 1 year 5,259,495 871,396
216,575,017 129,207,482
(b) Provision for losses and changes in book balance statements:
Stage 1 Stage 3
12-month ECL Lifetime ECL
(grouping) (credit-impaired) Total
Provision for Provision for Provision for
Book balance bad debts Book balance bad debts bad debts
31 December 2020 129,207,482 (217,909) - - (217,909)
Balance increase in the
current period 87,367,535 - - - -
Including: Write-off in the
current period - - - - -
Provision for bad debts in the
current period - (177,179) - - (177,179)
30 June 2021 216,575,017 (395,088) - - (395,088)
The Group had no other receivables transferred from Stage 1 to Stage 3, and no other
receivables reversed from Stage 3 to Stage 1.
As at June 30, 2021, the Group has no other receivables in stage 2 and Stage 3.
46
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(6) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d):
The analysis of other receivables at Stage 1 and Stage 3 is stated below:
(i) As at 30 June 2021 and 31 December 2020, the Group had no other receivables with
provision for bad debts on the individual basis.
(ii) As at 30 June 2021 and 31 December 2020, the Group’s other receivables with provision
for bad debts on the grouping basis were analysed below:
Other receivables with provision on the grouping basis at Stage 1:
30 June 2021 31 December 2020
Book Book
balance Provision for losses balance Provision for losses
Provision Provision
Amount ratio Amount Amount ratio Amount
Portfolios of interest
from cash at bank i):
Within 1 year 85,462,590 - - 60,283,645 - -
Grouping - Operating
advances and
deposits:
Within 1 year 125,852,932 0.30% (379,239) 68,052,441 0.32% (215,154)
Over 1 year 5,259,495 0.30% (15,849) 871,396 0.32% (2,755)
216,575,017 (395,088) 129,207,482 (217,909)
i) As at 30 June 2021 and 31 December 2020, the Group’s interest receivable from cash at
bank mainly came from four major state-owned banks or national joint-stock banks.
Therefore, the Group expected that there was no material credit risk associated with
related interest receivable and thus there was no significant losses on related interest
receivable from non-performance by these banks.
(c) For the six months ended 30 June 2021, The amount of bad debt provision was RMB
177,179.
(d) For the six months ended 30 June 2021, The group has no actual write-off of other
receivables.
47
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(6) Other receivables (Cont’d)
(e) As at 30 June 2021, the five largest other receivables aggregated by debtor were analysed
as follows:
% of total Provision for
Nature Balance Ageing balance bad debts
Assets
Company 1 receivables 32,555,714 Within 1 year 15.03% (97,667)
Advances
classified as
Company 2 expenses 25,190,512 Within 1 year 11.63% (75,572)
Advances
Assets
Company 3 receivables 18,513,359 Within 1 year 8.55% (55,540)
Assets
Company 4 receivables 11,955,220 Within 1 year 5.52% (35,866)
Advances
classified as
Company 5 expenses 9,486,001 Within 1 year 4.38% (28,458)
97,700,806 45.11% (293,103)
(7) Inventories
(a) Inventories are summarised by categories as follows:
30 June 2021 31 December 2020
Provision for Carrying Provision for Carrying
Book balance inventories amount Book balance inventories amount
Materials in
transit 135,266,570 - 135,266,570 98,887,111 - 98,887,111
Raw materials 1,099,742,966 (88,186,867) 1,011,556,099 816,201,410 (109,312,198) 706,889,212
Work in
progress 278,794,412 (175,387) 278,619,025 268,716,191 (175,387) 268,540,804
Finished goods 603,112,024 - 603,112,024 815,055,053 - 815,055,053
Low cost
consumables 148,219,701 (32,479,143) 115,740,558 160,969,525 (32,479,143) 128,490,382
Materials
processed on
commission 34,521,160 - 34,521,160 68,743,130 - 68,743,130
2,299,656,833 (120,841,397) 2,178,815,436 2,228,572,420 (141,966,728) 2,086,605,692
(b) Provision for inventories is analysed as follows:
Increase in
the current
31 December period Decrease in the current period 30 June
2020 Provision Reversal Write-off 2021
Raw materials (109,312,198) - - 21,125,331 (88,186,867)
Work in progress (175,387) - - - (175,387)
Low cost consumables (32,479,143) - - - (32,479,143)
(141,966,728) - - 21,125,331 (120,841,397)
48
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR EDNED 30 June 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(7) Inventories (Cont'd)
(c) Provision for inventories is as follows:
Reason for current period
Specific basis for determining write-off of provision for
net realisable value inventories
Raw materials/Work in Based on the estimated The net realizable value of
progress/Low value selling price, less the inventories with provision
consumables estimated costs to completion, sales have been achieved
estimated selling and
distribution expenses and
related taxes
(8) Other current assets
30 June 2021 31 December 2020
Taxes Prepaid, Input VAT to be
deducted and to be verified 885,615,580 736,953,815
Others 111,409 415,922
885,726,989 737,369,737
49
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(9) Long-term equity investments
30 June 2021 31 December 2020
Associate
- Hanon Systems (Nanchang) Co., Ltd. (“Hanon Systems”) 39,232,347 39,496,548
Less: Provision for impairment of long-term equity investments - -
39,232,347 39,496,548
Associate
Movements for the current period
Share of net Cash Ending
Increase or profit/(loss) dividends balance of
31 December decrease in under equity declared by Provision for Shareholding Voting rights provision for
2020 investment method joint ventures impairment 30 June 2021 (%) (%) impairment
Hanon Systems 39,496,548 - (264,201) - - 39,232,347 19.15% 33.33% -
Related information of equity in associates is set forth in Note 5(2).
50
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(10) Fixed assets
30 June 2021 31 December 2020
Fixed assets (a) 4,782,132,367 5,164,260,516
Fixed assets pending for disposal (b) 3,362,458 1,695,894
4,785,494,825 5,165,956,410
(a) Fixed assets
Machinery and Electronic and
. Buildings equipment Motor vehicles Moulds other equipment Total
Cost
31 December
2020 2,300,951,630 4,011,283,000 353,517,996 3,154,261,304 4,004,241,347 13,824,255,277
Increase in the
current period
Transfer from
construction in
progress - 5,283,649 4,740,766 85,010,394 34,570,398 129,605,207
Other increases - - 7,682,876 - 43,215,116 50,897,992
Decrease in the
current period
Disposal or
retirement (12,050,420) (163,422,780) (4,035,565) (12,990,539) (32,833,161) (225,332,465)
Other decreases - (50,897,992) - - - (50,897,992)
30 June 2021 2,288,901,210 3,802,245,877 361,906,073 3,226,281,159 4,049,193,700 13,728,528,019
Accumulated
depreciation
31 December
2020 (573,584,513) (2,390,076,662) (232,596,897) (2,372,671,702) (2,596,189,492) (8,165,119,266)
Increase in the
current period
Provision (28,448,696) (110,821,592) (16,414,567) (110,466,772) (167,244,078) (433,395,705)
Decrease in the
current period
Disposal or
retirement 4,630,260 104,174,319 1,549,385 12,140,680 23,736,787 146,231,431
30 June 2021 (597,402,949) (2,396,723,935) (247,462,079) (2,470,997,794) (2,739,696,783) (8,452,283,540)
Provision for
impairment
31 December
2020 - (94,376,123) (6,070,058) (343,015,623) (51,413,691) (494,875,495)
Increase in the
current period
Provision - - - - - -
Decrease in the
current period
Disposal or
retirement - - 32,466 676,494 54,423 763,383
30 June 2021 - (94,376,123) (6,037,592) (342,339,129) (51,359,268) (494,112,112)
Carrying amount
30 June 2021 1,691,498,261 1,311,145,819 108,406,402 412,944,236 1,258,137,649 4,782,132,367
31 December
2020 1,727,367,117 1,526,830,215 114,851,041 438,573,979 1,356,638,164 5,164,260,516
51
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(10) Fixed assets (Cont'd)
(a) Fixed assets (Cont'd)
For the six months ended 30 June 2021, depreciation charged to fixed assets amounted to
RMB433,395,705 (the six months ended 30 June 2020: RMB517,638,550), of which the
depreciation expenses charged in the cost of sales, selling and distribution expenses,
general and administrative expenses and research and development expenses were
RMB336,443,335, RMB1,008,818, RMB63,916,100 and RMB32,027,452 (the six months
ended 30 June 2020: RMB398,894,781, RMB1,516,970, RMB81,887,718 and
RMB35,339,081), respectively.
The cost of fixed assets transferred from construction in progress amounted to
RMB129,605,207 (the six months ended 30 June 2020: RMB80,025,139) (Note 4(11)).
(i) Temporarily idle fixed assets
As at 30 June 2021, the fixed assets with a carrying amount of approximately
RMB59,246,836 (a cost of RMB1,012,789,184) (31 December 2020: a carrying amount of
approximately RMB16,532,578 and a cost of RMB483,214,712) were temporarily idle due
to factory relocation, the change of business development, product strategies and product
process etc. The analysis is as follows:
Accumulated Provision for Carrying
Cost depreciation impairment amount
Machinery and
equipment 300,907,156 (246,471,314) (37,209,692) 17,226,150
Motor vehicles 13,706,317 (9,122,213) (2,498,046) 2,086,058
Moulds 479,556,654 (151,571,099) (327,887,822) 97,733
Electronic and other
equipment 218,619,057 (166,750,609) (12,031,553) 39,836,895
1,012,789,184 (573,915,235) (379,627,113) 59,246,836
(ii) Fixed assets with pending certificates of ownership:
Reasons for not
obtaining certificates of
Carrying amount ownership
Buildings 275,429,305 Pending procedures
52
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(10) Fixed assets (Cont’d)
(b) Fixed assets pending for disposal
30 June 2021 31 December 2020
Electronic and other equipment 2,611,218 1,639,777
Machinery and equipment 662,952 56,117
Motor vehicles 88,288 -
3,362,458 1,695,894
(11) Construction in progress
30 June 2021 31 December 2020
Provision for Carrying Provision for Carrying
Book balance impairment amount Book balance impairment amount
Fushan new plant investment
project 642,211,422 - 642,211,422 522,070,550 - 522,070,550
Capacity optimization project 701,633,914 - 701,633,914 504,378,481 - 504,378,481
Construction of Xiaolan 600
mu Phase 3 plan 128,932,841 - 128,932,841 105,196,107 - 105,196,107
Engine construction project 99,021,903 - 99,021,903 106,148,911 - 106,148,911
CX756 project 61,099,732 - 61,099,732 89,516,432 - 89,516,432
N822 project 74,884,781 - 74,884,781 31,176,961 - 31,176,961
Collision Simulation
Laboratory 44,998,123 - 44,998,123 45,422,684 - 45,422,684
CX743 conversion project 41,946,927 - 41,946,927 26,409,132 - 26,409,132
N356 project 13,789,890 - 13,789,890 13,789,890 - 13,789,890
V348 conversion project 9,518,173 - 9,518,173 23,183,603 - 23,183,603
JF8/CX743 project 9,173,450 - 9,173,450 7,347,943 - 7,347,943
Independently developed
gasoline engine project 1,041,249 - 1,041,249 1,041,249 - 1,041,249
N806 Project 622,136 - 622,136 622,136 - 622,136
Stamping/frame
Capacity
improvement project 137,377 - 137,377 137,377 - 137,377
Other miscellaneous and
pending installation
projects 99,665,142 (691,646) 98,973,496 59,747,960 (691,646) 59,056,314
1,928,677,060 (691,646) 1,927,985,414 1,536,189,416 (691,646) 1,535,497,770
53
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(11) Construction in progress (Cont’d)
(a) Movement of significant projects of construction in progress
Including:
Borrowing
Transfer to Accumulative costs
fixed assets in Decrease in % of project capitalised capitalised in
Budget 31 December Increase in the the current the current investment in Progress of borrowing the current Source of
Project name (in RMB 0’000) 2020 current period period period 30 June 2021 budget project costs period fund
Fushan new plant Self-owned
investment project 205,200 522,070,550 130,765,582 (10,624,710) - 642,211,422 55% 55% - - funds
Capacity optimization Self-owned
project 179,462 504,378,481 199,370,623 (2,115,190) - 701,633,914 39% 39% - - funds
Construction of Xiaolan Self-owned
600 mu Phase 3 plan 20,977 105,196,107 24,083,522 (346,788) - 128,932,841 63% 63% - - funds
Self-owned
Engine construction project 67,000 106,148,911 4,002,290 (11,129,298) - 99,021,903 69% 69% - - funds
Self-owned
CX756 project 19,000 89,516,432 31,100,951 (59,517,651) - 61,099,732 69% 69% - - funds
Self-owned
N822 project 20,700 31,176,961 43,853,838 (146,018) - 74,884,781 36% 36% - - funds
Collision Simulation Self-owned
Laboratory 9,651 45,422,684 2,507,361 (2,931,922) - 44,998,123 76% 76% - - funds
Self-owned
CX743 conversion project 11,006 26,409,132 16,038,805 (501,010) - 41,946,927 39% 39% - - funds
Self-owned
N356 project 13,600 13,789,890 360,450 (360,450) - 13,789,890 80% 80% - - funds
Self-owned
V348 conversion project 4,390 23,183,603 5,288,213 (18,953,643) - 9,518,173 72% 72% - - funds
Self-owned
JF8/CX743 project 13,690 7,347,943 3,281,804 (1,456,297) - 9,173,450 95% 95% - - funds
Independently developed Self-owned
gasoline engine project 43,200 1,041,249 - - - 1,041,249 92% 92% - - funds
Self-owned
N806 Project 2,860 622,136 - - - 622,136 70% 70% - - funds
Stamping/frame
Capacity improvement Self-owned
project 56,778 137,377 - - - 137,377 81% 81% - - funds
Other miscellaneous and Self-owned
pending installation funds and
projects 59,747,960 76,063,127 (21,522,230) (14,623,715) 99,665,142 292,897 - loans
1,536,189,416 536,716,566 (129,605,207) (14,623,715) 1,928,677,060 292,897
54
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
Notes to the consolidated financial statements (Cont’d)
(11) Construction in progress (Cont’d)
(b) Provision for impairment of construction in progress
31 December Increase in the Decrease in the
2020 current period current period 30 June 2021 Reason for provision
The recoverable
Other miscellaneous and pending amount is lower than
installation projects (691,646) - - (691,646) the book value
55
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(12) Right-of-use assets
Buildings
Cost
31 December 2020 42,736,398
Increase in the current period
New lease contracts 19,716,958
30 June 2021 62,453,356
Accumulated depreciation
31 December 2020 (14,330,508)
Increase in the current period
Provision (7,354,220)
30 June 2021 (21,684,728)
Provision for impairment
31 December 2020 -
Increase in the current period -
Decrease in the current
period -
30 June 2021 -
Carrying amount
30 June 2021 40,768,628
31 December 2020 28,405,890
For the six months ended 30 June 2021, depreciation of right-of-use assets amounted to
RMB7,354,220, of which RMB3,554,214, RMB1,685,693, RMB1,599,215 and
RMB515,098 were included in cost of sales and selling distribution expenses, general and
administrative expenses and research and development expenses(the six months ended
30 June 2020: RMB5,775,094, RMB1,450,734, RMB 0 and RMB 0), respectively.
56
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Intangible assets
After-sales
services
Land use Software use Non-patent management
rights fees technologies model Others Total
Cost
31 December 2020 751,625,667 206,965,791 540,153,070 36,979,184 1,599,516 1,537,323,228
Increase in the current
period
Transfer from
construction in
progress - 14,623,715 - - - 14,623,715
Internal research and
development - - 194,823,495 - - 194,823,495
Decrease in the current
period
Disposal - - - - - -
30 June 2021 751,625,667 221,589,506 734,976,565 36,979,184 1,599,516 1,746,770,438
Accumulated amortisation
31 December 2020 (181,512,922) (130,785,042) (216,248,050) (36,979,184) (1,599,516) (567,124,714)
Increase in the current
period
Provision (7,786,924) (12,666,156) (56,909,822) - - (77,362,902)
Decrease in the current
period
Disposal - - - - - -
30 June 2021 (189,299,846) (143,451,198) (273,157,872) (36,979,184) (1,599,516) (644,487,616)
Provision for impairment
31 December 2020 - - (38,806,961) - - (38,806,961)
Increase in the current
period
Provision - - - - - -
30 June 2021 - - (38,806,961) - - (38,806,961)
Carrying amount
30 June 2021 562,325,821 78,138,308 423,011,732 - - 1,063,475,861
31 December 2020 570,112,745 76,180,749 285,098,059 - - 931,391,553
For the six months ended 30 June 2021, amortisation charged to intangible assets
amounted to RMB77,362,902 (the six months ended 30 June 2020: RMB58,225,513), of
which the amounts charged to cost of sales, selling and distribution expenses, general and
administrative expenses, and research and development expenses were RMB273,069,
RMB223,108, RMB19,015,855 and RMB57,850,870 respectively. (the six months ended
30 June 2020: RMB 273,069,RMB 179,314,RMB 18,893,016 and RMB 38,880,114).
57
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Intangible assets (Cont’d)
The Group's development expenditures are set out below:
Decrease in the current period
Increase in Recognised Write off
31 December the current as intangible
2020 period assets 30 June 2021
Automobile products
development project 173,473,242 50,413,638 (194,823,495) - 29,063,385
Expenditures on research and development of the Group incurred in the six months ended
30 June 2021 amounted to RMB776,879,828 (the six months ended 30 June 2020:
RMB823,946,960) in total, of which RMB726,466,190 (the six months ended 30 June
2020: RMB696,582,452) was recognised in profit or loss for the current period,
RMB21,350,253 (the six months ended 30 June 2020: RMB86,341,229) was recognised
as intangible assets for the current period and RMB29,063,385 (the six months ended 30
June 2020: RMB41,023,279) was included in the ending balance of development
expenditures. As at 30 June 2021, the intangible assets developed by the Group
accounted for 40% (31 December 2020: 31%) of the carrying amount of intangible assets.
58
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Deferred tax assets and deferred tax liabilities
(a) Deferred tax assets before offsetting
30 June 2021 31 December 2020
Deductible Deductible
temporary temporary
differences differences
and deductible Deferred tax and deductible Deferred tax
tax losses assets losses assets
Accrued expenses
and provisions 4,818,974,406 1,097,011,961 3,918,637,644 896,970,479
Recoverable losses 1,995,262,058 304,346,957 2,032,780,205 307,105,716
Provision for asset
impairment 859,642,508 134,539,799 897,520,189 140,838,024
Non-patent
technology 132,289,550 28,462,021 108,124,026 23,281,348
Retirement benefits
plan 65,518,693 15,186,804 67,587,000 15,497,050
Deferred income 48,943,773 7,341,566 49,944,625 7,491,694
Employee education
funds unpaid 59,205,852 9,272,799 42,695,014 6,607,339
Others 76,045,095 11,456,912 54,068,775 8,189,817
8,055,881,935 1,607,618,819 7,171,357,478 1,405,981,467
Including:
Expected to be
recovered within
one year
(inclusive) 1,275,807,710 1,065,699,235
Expected to be
recovered after
one year 331,811,109 340,282,232
1,607,618,819 1,405,981,467
59
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Deferred tax assets and deferred tax liabilities (Cont’d)
(b) Deferred tax liabilities before offsetting
30 June 2021 31 December 2020
Taxable Taxable
temporary Deferred tax temporary Deferred tax
differences liabilities differences liabilities
Depreciation of
fixed assets 1,386,782,904 272,291,672 1,247,553,627 235,959,055
Net losses related
to debt exemption
and equity
transactions
between parent
and subsidiary 785,943,493 117,891,524 682,000,000 102,300,000
Amortisation of
intangible assets 40,945,579 6,328,260 38,367,939 5,779,320
Differences
between the fair
value of the
identifiable net
assets and
carrying amount
arising from
business
combinations not
under common
control 97,392,184 24,348,046 98,780,656 24,695,164
Others 3,211,507 802,877 1,095,069 273,767
2,314,275,667 421,662,379 2,067,797,291 369,007,306
Including:
Expected to be
recovered within
one year
(inclusive) 171,737,530 147,540,386
Expected to be
recovered after
one year 249,924,849 221,466,920
421,662,379 369,007,306
60
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Deferred tax assets and deferred tax liabilities (Cont’d)
(c) Deductible temporary differences and deductible losses that are not recognised as
deferred tax assets are analysed as follows:
30 June 2021 31 December 2020
Deductible losses 117,022,793 171,901,892
Deductible temporary differences 467,558 3,119,574
117,490,351 175,021,466
(d) Deductible losses that are not recognised as deferred tax assets will be expired in
following years:
30 June 2021 31 December 2020
2024 117,022,793 171,901,892
(e) The net balances of deferred tax assets and liabilities after offsetting are as follows:
30 June 2021 31 December 2020
Offsetting Balance after Offsetting Balance after
amount offsetting amount offsetting
Deferred tax assets (279,422,809) 1,328,196,010 (242,012,142) 1,163,969,325
Deferred tax liabilities (279,422,809) 142,239,570 (242,012,142) 126,995,164
61
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(15) Provision for asset impairment and losses
31 December Increase in the Decrease in the current period
2020 current period Reversal Write-off 30 June 2021
Provision for bad debts of accounts
receivable 233,902,000 - (7,566,556) - 226,335,444
Including: Provision for bad debts on the
individual basis 186,293,298 - (2,000,000) - 184,293,298
Provision for bad debts on the
grouping basis 47,608,702 - (5,566,556) - 42,042,146
Provision for bad debts of other receivables 217,909 177,179 - - 395,088
Sub-total 234,119,909 177,179 (7,566,556) - 226,730,532
Provision for inventories 141,966,728 - - (21,125,331) 120,841,397
Provision for impairment of fixed assets 494,875,495 - - (763,383) 494,112,112
Provision for impairment of construction in
progress 691,646 - - - 691,646
Provision for impairment of goodwill 89,028,412 - - - 89,028,412
Provision for impairment of intangible assets 38,806,961 - - - 38,806,961
Sub-total 765,369,242 - - (21,888,714) 743,480,528
999,489,151 177,179 (7,566,556) (21,888,714) 970,211,060
62
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(16) Short-term borrowings
30 June 2021 31 December 2020
Credit loan 500,000,000 500,000,000
As at June 31 2021, the interest rate for the short-term loan is 2.85% (December 31, 2020:
2.05% to 3.15%).
(17) Derivative financial liabilities
30 June 2021 31 December 2020
Derivative financial liabilities -
Forward exchange contracts 8,165,742 3,716,727
As at 30 June 2021 and 31 December 2020, derivative financial liabilities mainly
represented forward exchange contracts.
(18) Notes payable
30 June 2021 31 December 2020
Bank acceptance notes 1,565,665 -
(19) Accounts payable
30 June 2021 31 December 2020
Payable for spare parts 9,207,129,657 9,672,652,729
Payable for raw and auxiliary
materials 201,416,746 353,563,148
9,408,546,403 10,026,215,877
As at 30 June 2021, accounts payable with ageing over 1 year amounted to
RMB406,639,200 (31 December 2020: RMB431,202,897), which mainly represented
materials payable for which settlement price has not yet been determined, and such
payables had not been finally settled yet.
63
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(20) Contract liabilities
30 June 2021 31 December 2020
Advances for automobiles and
automobile parts 113,014,269 521,367,837
Advances for maintenance and
warranty services 148,455,912 136,685,473
261,470,181 658,053,310
Less: Contract liabilities expected to
be included in revenue after
one year (Note 4(31)) (105,589,814) (99,526,464)
155,880,367 558,526,846
(21) Employee benefits payable
30 June 2021 31 December 2020
Short-term employee benefits
payable (a) 490,146,268 617,598,452
Defined contribution plans
payable (b) 135,984,526 135,699,978
Defined benefit plans payable (c) 3,415,000 3,415,000
Termination benefits payable (d) 2,655,176 2,655,176
632,200,970 759,368,606
(a) Short-term employee benefits
Increase in the Decrease in the
31 December 2020 current period current period 30 June 2021
Wages and salaries,
bonus, allowances and
subsidies 539,376,881 1,009,880,252 (1,158,816,011) 390,441,122
Staff welfare 26,872,505 54,777,228 (47,177,698) 34,472,035
Social security
contributions 3,877,466 53,558,925 (53,401,795) 4,034,596
Including: Medical
insurance - 45,145,334 (44,992,082) 153,252
Work injury
insurance 3,877,466 3,166,398 (3,162,671) 3,881,193
Maternity
insurance - 5,247,193 (5,247,042) 151
Housing funds - 73,446,013 (73,276,315) 169,698
Labour union funds and
employee education
funds 47,471,600 39,788,461 (26,231,244) 61,028,817
Other short-term
employee benefits - 4,848,118 (4,848,118) -
617,598,452 1,236,298,997 (1,363,751,181) 490,146,268
64
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(21) Employee benefits payable (Cont’d)
(b) Defined contribution plans
Increase in the Decrease in the
31 December 2020 current period current period 30 June 2021
Basic pensions 131,620,467 107,073,450 (106,814,225) 131,879,692
Supplementary pensions - 10,400,000 (10,400,000) -
Unemployment
insurance 4,079,511 3,399,495 (3,374,172) 4,104,834
135,699,978 120,872,945 (120,588,397) 135,984,526
(c) Defined benefit plans
Increase in the Decrease in the
31 December 2020 current period current period 30 June 2021
Post-retirement benefits
payable (Note 4(30)) 3,415,000 1,282,213 (1,282,213) 3,415,000
(d) Termination benefits payable
30 June 2021 31 December 2020
Early retirement benefits payable
(Note 4(30)) 1,317,000 1,317,000
Other termination benefits (i) 1,338,176 1,338,176
2,655,176 2,655,176
(i) For the six months ended 30 June 2021, other termination benefits paid by the Group
for termination of the employment relationship were RMB13,174,883.
65
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(22) Taxes payable
30 June 2021 31 December 2020
Enterprise income tax payable 164,607,336 88,142,260
Consumption tax payable 65,438,708 78,952,885
Unpaid VAT 36,066,495 26,439,025
Land use tax payable 4,819,354 5,746,521
City maintenance and construction
tax payable 2,558,480 2,005,985
Educational surcharge payable 1,827,486 1,432,847
Others 16,297,138 15,725,704
291,614,997 218,445,227
(23) Other payables
30 June 2021 31 December 2020
Ordinary share dividends payable 3,006,966,959 6,463,836
Construction expenses 2,694,444,804 2,213,691,765
Research and development project
expenses 712,135,448 673,089,112
Advertising and new product
planning fees 192,331,108 161,524,470
Construction expenses 181,182,323 290,525,592
Goods transportation expenses 163,702,631 148,274,852
Deposit payable 146,416,930 97,973,078
Technological transformation project
expenses 46,511,283 21,530,592
Trademark management fees 13,153,276 2,485,538
Consulting expenses 11,514,272 10,298,545
Others 856,541,020 527,992,245
8,024,900,054 4,153,849,625
As at 30 June 2021, other payables with ageing over 1 year of RMB1,075,939,516
(31December 2020: RMB819,824,836) mainly comprised deposits collected from logistics
companies, distributors and repair stations, payables for projects and payables for
research and development expenses. Such payables had not been finally settled yet in
view of the continuing business transactions with distributors and service providers, and
engineering projects and research and development projects that have not yet been
accepted and completed.
66
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(24) Current portion of non-current liabilities
30 June 2021 31 December 2020
Current portion of lease liabilities
(Note 4(27)) 16,179,742 10,481,886
Current portion of long-term
borrowings (Note 4(26)) 423,034 427,277
16,602,776 10,909,163
(25) Other current liabilities
30 June 2021 31 December 2020
Provisions expected to be settled
within one year (Note 4(28)) 368,170,576 343,121,509
Others 14,686,957 67,777,819
382,857,533 410,899,328
(26) Long-term borrowings
30 June 2021 31 December 2020
Secured borrowings 2,749,722 2,990,943
Less: Current portion of long-term
borrowings (Note 4(24)) (423,034) (427,277)
2,326,688 2,563,666
The above secured borrowings were long-term borrowings amounting to USD 425,647
secured by JMCF, borrowed from Industrial and Commercial Bank of China (“ICBC”),
Nanchang Ganjiang Sub-branch with interest payable every half year and the principal was
paid in instalments between 10 December 2007 and 27 October 2027. For the six months
ended 30 June 2021, the interest rate of long-term borrowings was 1.5% (For the Six
Months Ended 30 June 2020: 1.5%).
30 June 2021 31 December 2020
Amount in Amount in
Starting Maturity Interest foreign RMB foreign RMB
date date Currency rate (%) currency equivalent currency equivalent
27 27
ICBC Nanchang February October
Ganjiang Sub-branch 1998 2027 USD 1.5% 425,647 2,749,722 458,389 2,990,943
(27) Lease liabilities
30 June 2021 31 December 2020
Lease liabilities 44,033,765 29,480,838
Less: Current portion of non-
current liabilities (Note
4(24)) (16,179,742) (10,481,886)
27,854,023 18,998,952
(a) As at the six months ended 30 June 2021, the lease payment related to the lease contract
that the Group has signed but has not yet begun to execute is RMB361,843,200((Note 11
(3))(December 31, 2020: RMB361,843,200).
67
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(28) Provisions
Increase in the Decrease in the
31 December 2020 current period current period 30 June 2021
Product warranties i) 511,619,012 238,355,518 (197,813,393) 552,161,137
provision for contracts 27,398,636 - (4,392,114) 23,006,522
539,017,648 238,355,518 (202,205,507) 575,167,659
Less: Provisions
expected to be
settled within one
year (Note 4(25)) (343,121,509) (368,170,576)
195,896,139 206,997,083
i) Product warranties are expenses expected to be incurred during the warranty period from free
after-sales services, product warranty and other services for vehicles sold.
(29) Deferred income
31 December Increase in the Decrease in the
2020 current period current period 30 June 2021 Reason
Government
grants (a) 49,944,625 960,000 (1,960,852) 48,943,773 Subsidy for projects
(a) Government grants
Decrease in the current period
Increase in
31 December the current Recognised in Offset financial Asset related/
2020 period other income expenses 30 June 2021 Income related
Research and
development-
related subsidies 47,519,981 960,000 (200,727) - 48,279,254 Income related
Government interest
subsidies 1,760,125 - - (1,760,125) - Income related
Others 664,519 - - - 664,519 Income related
49,944,625 960,000 (200,727) (1,760,125) 48,943,773
68
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(30) Long-term employee benefits payable
30 June 2021 31 December 2020
Supplementary retirement benefits
and early-retirement benefits
eligible for recognition of
provisions 65,518,693 67,587,000
Less: Payable within one year (4,732,000) (4,732,000)
60,786,693 62,855,000
The retirement and early-retirement benefits payable within one year are included in
employee benefits payable(Note 4(21)(c), (d)).
For retired and early-retired employees, the Group provides them with certain amount of
supplementary benefits during their retirement or early-retirement period. The amount of
benefits depends on the employee's position, length of service and salary at the time of
retirement or early-retirement, and is adjusted in accordance with inflation rate and other
factors. The Group's obligations for supplementary retirement and early-retirement benefits
as at the balance sheet date are calculated using projected unit credit method and are
reviewed by an external independent actuary.
(a) Movements of retirement and early-retirement benefits of the Group are as follows:
Present value of the obligations of the
defined benefit plan
30 June 2021 31 December 2020
Opening balance 67,587,000 68,441,000
Cost of defined benefit plan
recognised in profit or loss for
the current period
- Current service cost - 1,242,000
- Past service cost - -
- Actuarial (gains)/losses
recognised immediately - (843,000)
- Net interest - 2,324,000
Remeasurement of net liabilities
for defined benefit plan
- Actuarial losses - 485,000
Other movements
- Benefits paid (2,068,307) (4,062,000)
Ending balance 65,518,693 67,587,000
69
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(30) Long-term employee benefits payable (Cont'd)
(b) The actuarial assumptions used to determine the present value of defined benefit plan
obligations
30 June 2021 31 December 2020
Discount rates —— 3.75%
Inflation rate —— 2.0%
Salaries and benefits growth rates —— 0%-6%
Future mortality assumptions were determined based on the China Life Insurance Mortality
Table (2010-2013), which is publicly available statistical information for the Chinese region.
(31) Other non-current liabilities
30 June 2021 31 December 2020
Contract liabilities expected to be
included in revenue after one year
(Note 4(20)) 105,589,814 99,526,464
70
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(32) Share capital
Movements for the current period
31 December Shares newly Transfer from
2020 issued Bonus share capital surplus Others Sub-total 30 June 2021
Shares subject to trading restriction -
Other domestic shares
Including: Shares held by domestic non-state- - -
owned legal persons 745,140 - - - 745,140
Shares held by domestic natural - -
persons 5,700 - - - 5,700
750,840 - - - - - 750,840
Shares not subject to trading restriction -
Ordinary shares denominated in RMB 518,463,160 - - - - - 518,463,160
Domestically listed foreign shares 344,000,000 - - - - - 344,000,000
862,463,160 - - - - - 862,463,160
863,214,000 - - - - - 863,214,000
Since the implementation of the Company's Scheme on Share Split Reform on 13 February 2006, as at 30 June 2021, there were 750,840 shares
currently unavailable for trading.
71
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(32) Share capital (Cont’d)
Movements for the current year
31 December Shares newly Transfer from 31 December
2019 issued Bonus share capital surplus Others Sub-total 2020
Shares subject to trading restriction -
Other domestic shares
Including: Shares held by domestic non-state-
owned legal persons 749,940 - - - (4,800) (4,800) 745,140
Shares held by domestic natural
persons 975 - - - 4,725 4,725 5700
750,915 - - - (75) (75) 750,840
Shares not subject to trading restriction -
Ordinary shares denominated in RMB 518,463,085 - - - 75 75 518,463,160
Domestically listed foreign shares 344,000,000 - - - - - 344,000,000
862,463,085 - - - 75 75 862,463,160
863,214,000 - - - - - 863,214,000
72
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(33) Capital surplus
Decrease in
31 December Increase in the the current
2020 current period period 30 June 2021
Share premium 816,609,422 - - 816,609,422
Other capital
surplus 22,833,068 - - 22,833,068
839,442,490 - - 839,442,490
Decrease in
31 December Increase in the the current 31 December
2019 current year year 2020
Share premium 816,609,422 - - 816,609,422
Other capital
surplus 22,833,068 - - 22,833,068
839,442,490 - - 839,442,490
73
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(34) Other comprehensive income
Other comprehensive income in the income statement for the Six Months
Other comprehensive income in the balance sheet Ended 30 June 2021
Less: Transfer-
out of previous
Attributable to Amount incurred other Attributable to
the parent before income comprehensive the parent
31 December company after tax for the income in the Less: Income company after
2020 tax 30 June 2021 current period current period tax expenses tax
Other comprehensive income items which will not be
reclassified to profit or loss
Actuarial gains on defined benefit plans (11,759,250) - (11,759,250) - - - -
Other comprehensive income in the income statement for the year ended
Other comprehensive income in the balance sheet 31 December 2020
Less: Transfer-
out of previous
Attributable to Amount incurred other Attributable to
the parent before income comprehensive the parent
31 December company after 31 December tax for the income in the Less: Income company after
2019 tax 2020 current year current year tax expenses tax
Other comprehensive income items which will not be
reclassified to profit or loss
Actuarial gains on defined benefit plans (11,395,500) (363,750) (11,759,250) (485,000) - 121,250 (363,750)
74
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Surplus reserve
Decrease in
31 December Increase in the the current
2020 current period period 30 June 2021
Statutory surplus
reserve 431,607,000 - - 431,607,000
Decrease in
31 December Increase in the the current 31 December
2019 current year year 2020
Statutory surplus
reserve 431,607,000 - - 431,607,000
In accordance with the Company Law of the People's Republic of China, the Company’s
Articles of Association and the resolution of the Board of Directors, the Company should
appropriate 10% of net profit for the year to the statutory surplus reserve, and the
Company can cease appropriation when the statutory surplus reserve accumulated to
more than 50% of the registered capital. The statutory surplus reserve can be used to
make up for the loss or increase the share capital upon approval from the appropriate
authorities. As the accumulated appropriation to the statuary surplus reserve exceeded
50% of the registered capital, no appropriation was made in the current period(2020: Nil).
The Company appropriates for the discretionary surplus reserve after the shareholders’
meeting approves the proposal from the Board of Directors. The discretionary surplus
reserve can be used to compensate for the losses incurred in prior years or increase the
share capital upon approval from appropriate authorities.
(36) Retained earnings
Six months ended 30 June
2021 2020
Retained earnings at the beginning
of the year 8,863,969,769 8,373,695,791
Add: Net profit attributable to
shareholders of the parent
company for the current
period 405,214,055 207,771,782
Less: Ordinary share dividends
payable (a) (3,000,531,864) (60,424,980)
Retained earnings at the end of the
period 6,268,651,960 8,521,042,593
(a) According to the resolution of the board of directors on March 26th, 2021, the board of
directors proposed that the Company distribute cash dividends of RMB3.476 per share to
all shareholders. Based on the issued shares of 863,214,000, the proposed cash dividends
total RMB3,000,531,864, and the proposal was approved by the shareholders' meeting on
June 25, 2021
75
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(37) Revenue and cost of sales
Six months ended 30 June
2021 2020
Revenue from main business 17,360,624,109 13,877,590,851
Revenue from other business 314,996,979 195,827,027
17,675,621,088 14,073,417,878
Six months ended 30 June
2021 2020
Cost of sales from main business 14,756,422,659 11,670,570,165
Cost of sales from other business 293,802,060 189,552,200
15,050,224,719 11,860,122,365
(a) Revenue and cost of sales from main business
Six months ended 30 June
2021 2020
Revenue from Cost of sales from Revenue from Cost of sales from
main business main business main business main business
Sales of automobiles 16,283,174,183 13,950,596,206 13,030,304,986 11,046,531,024
Sales of automobile parts 1,023,854,381 747,849,973 809,320,498 582,437,916
Automobile maintenance
services 53,595,545 57,976,480 37,965,367 41,601,225
17,360,624,109 14,756,422,659 13,877,590,851 11,670,570,165
(b) Revenue and cost of sales from other business
Six months ended 30 June
2021 2020
Revenue from Cost of sales from Revenue from Cost of sales from
other business other business other business other business
Sales of materials 257,593,313 238,590,185 162,807,656 155,071,014
Others 57,403,666 55,211,875 33,019,371 34,481,186
314,996,979 293,802,060 195,827,027 189,552,200
76
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(37) Revenue and cost of sales (Cont’d)
(c) The Group's revenue in 2021 was broken down as follows:
Six months ended 30 June 2021
Automobile
Automobile maintenance Materials and
Automobiles parts services others Total
Revenue from main
business 16,283,174,183 1,023,854,381 53,595,545 - 17,360,624,109
Including: Recognised at
a time point 16,283,174,183 1,023,854,381 - - 17,307,028,564
Recognised
within a
certain
period - - 53,595,545 - 53,595,545
Revenue from other
business - - - 314,996,979 314,996,979
16,283,174,183 1,023,854,381 53,595,545 314,996,979 17,675,621,088
(i) As at 30 June 2021, the amount of revenue corresponding to the performance obligation of
the Group that has been contracted but not yet performed or not fulfilled was
RMB148,455,912, which was expected to be recognised between 2021 and 2026.
(38) Taxes and surcharges
Six months ended 30 June
2021 2020
Consumption tax 366,921,695 271,679,866
City maintenance and construction
tax 46,652,034 50,598,211
Educational surcharge 42,987,981 43,310,138
Land use tax 9,534,267 9,774,064
Real estate tax 8,736,554 8,220,537
Stamp tax 4,155,789 2,779,740
Others 253,194 216,586
479,241,514 386,579,142
77
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(39) Selling and distribution expenses
Six months ended 30 June
2021 2020
Promotion expenses 241,079,452 91,894,222
Warranties 238,355,518 155,588,778
Advertising and new product
planning fees 139,947,287 138,350,765
Sales network construction
expenses 122,520,260 41,733,973
Salaries and benefits 96,986,506 70,754,094
Storage expenses 30,124,253 17,822,522
Packaging material expenses 18,318,542 14,586,046
Depreciation and amortisation
expenses 2,917,619 3,147,018
Others 59,264,981 58,309,902
949,514,418 592,187,320
(40) General and administrative expenses
Six months ended 30 June
2021 2020
Salaries and benefits 303,656,754 264,648,937
Depreciation and amortisation
expenses 84,531,170 100,780,734
Trademark management fees 22,232,060 20,627,894
General office expenses 10,744,528 7,103,298
Repair expenses 6,143,557 7,181,637
Travelling expenses 3,114,916 2,092,846
Others 99,394,555 56,692,100
529,817,540 459,127,446
(41) Research and development expenses
Six months ended 30 June
2021 2020
Salaries and benefits 273,546,646 277,417,893
Research and development
expenses 123,421,584 102,381,915
Design fee 93,888,283 145,947,582
Depreciation and amortisation
expenses 90,393,420 74,219,195
Materials expenses 72,889,999 27,797,465
Others 72,326,258 68,818,402
726,466,190 696,582,452
78
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(42) Financial expenses
Six months ended 30 June
2021 2020
Interest costs 13,014,765 18,259,820
Add: Interest expenses on lease
liabilities 878,444 802,145
Less: Government subsidies (Note
4(29)) (1,760,125) -
Interest expenses 12,133,084 19,061,965
Less: Interest income from bank
deposits (142,004,807) (89,499,630)
Fund occupation fee (a) (7,142,858) (4,740,888)
Interest income (149,147,665) (94,240,518)
Exchange gains or losses (8,772,108) 7,561,075
Others 344,402 885,665
(145,442,287) (66,731,813)
(a) The fund occupation fee is the fee paid to the Group at the rate agreed by both parties
when the distributors delay payment or settle with a bill of exchange.
(43) Expenses by nature
The cost of sales, selling and distribution expenses, general and administrative expenses
and research and development expenses in the income statement are listed as follows by
nature:
Six months ended 30 June
2021 2020
Changes in inventories of finished
goods and work in progress 201,864,808 280,051,275
Consumed raw materials, low value
consumables, etc. 13,230,742,782 10,272,137,288
Employee benefits 1,370,346,825 1,196,965,144
Depreciation of fixed assets 433,395,705 517,638,550
Amortisation of intangible assets 77,362,902 58,225,513
Depreciation of right-of-use assets 7,354,220 7,225,828
Transportation expenses 424,338,871 255,909,419
Warranties 238,355,518 155,588,778
Promotion expenses 241,079,452 91,894,222
Advertising and new product
planning fees 139,947,287 138,350,765
Design fee 93,888,283 145,947,582
Research and development
expenses 123,421,584 102,381,915
Fixed asset repair and maintenance
expenses 63,661,306 41,966,653
Others 610,263,324 343,736,651
17,256,022,867 13,608,019,583
79
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(44) Asset impairment losses
Six months ended 30 June
2021 2020
Provision for inventories - 23,856,596
Impairment of fixed assets - 10,251,114
- 34,107,710
(45) Credit impairment losses
Six months ended 30 June
2021 2020
Losses on bad debts of accounts
receivable (7,566,557) 66,317,513
Losses on bad debts of other
receivables 177,179 (74,702)
(7,389,378) 66,242,811
(46) Other income
Six months ended 30 June
Asset related/
2021 2020 Income related
Subsidy for operating
activities 324,065,109 138,966,751 Income related
Research and
development activities
related subsidies 9,227,727 26,672,716 Income related
333,292,836 165,639,467
(47) Investment income
Six months ended 30 June
2021 2020
Investment income from financial
assets held for trading 10,204,592 32,619,541
Investment losses from long-term
equity investment under equity
method (264,201) (3,024,554)
Losses on discount of financing
receivables (13,053,249) -
Investment loss from forward
exchange settlement (7,750,384) (1,316,987)
(10,863,242) 28,278,000
There is no significant restriction on the remittance of investment income to the Group.
80
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(48) Gains on changes in fair value
Six months ended 30 June
2021 2020
Financial assets at fair value through
profit or loss —
Structural deposits (681,478) 7,990,657
Derivative financial assets and
derivative financial liabilities -
(Losses)/Income on forward
exchange contracts (4,449,015) 2,021,384
(5,130,493) 10,012,041
(49) Gains on disposal of assets
Six months ended 30 June
Amount recognised
in non-recurring
profit or loss in six
months ended 30
2021 2020 June 2021
Income/(losses) on
disposal of assets 11,152,182 (581,955) 11,152,182
81
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(50) Non-operating income
Six months ended 30 June
Amount recognised
in non-recurring
profit or loss in six
months ended 30
2021 2020 June 2021
Compensation and 1,520,395 1,434,743 1,520,395
penalty income
Government grants (a) - 40,000 -
Others 989,882 2,124,450 989,882
2,510,277 3,599,193 2,510,277
(a) Details of government grants
Six months ended 30 June
Asset related/
2021 2020 Income related
Others - 40,000 Income related
(51) Non-operating expenses
Six months ended 30 June
Amount recognised
in non-recurring
profit or loss in six
months ended 30
2021 2020 June 2021
Losses on scrapping of
assets 143,574 25,278,620 143,574
Donations 1,995,000 4,936,682 1,995,000
Others 446,408 22,950 446,408
2,584,982 30,238,252 2,584,982
(52) Income tax expenses
Six months ended 30 June
2021 2020
Current income tax calculated based
on tax law and related regulations 165,333,174 12,440,650
Deferred income tax (148,982,279) 1,696,507
16,350,895 14,137,157
82
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(52) Income tax expenses (Cont’d)
The reconciliation from income tax calculated based on the applicable tax rates and total
profit presented in the consolidated income statement to the income tax expenses is listed
below:
Six months ended 30 June
2021 2020
Total profit 421,564,950 221,908,939
Income tax calculated at applicable
tax rates 49,035,811 4,273,820
Effect of change in the tax rates 14,052,432 16,397,340
Tax credit - (68,983)
Super deduction (73,910,521) (74,643,356)
Non-taxable income 39,630 453,683
Equity transactions and debt
exemption between parent and
subsidiary 25,985,873 -
Costs, expenses and losses not
deductible for tax purposes 15,530,448 143,379
Utilisation of previously
unrecognised deductible
temporary differences (663,003) (16,441,318)
Deductible losses for which no
deferred tax asset was recognised - 84,022,592
Utilisation of the deductible loss of
the unrecognized deferred tax
asset in the previous period (13,719,775) -
Income tax expenses 16,350,895 14,137,157
(53) Earnings per share
(a) Basic earnings per share
Basic earnings per share are calculated by dividing consolidated net profit attributable to
ordinary shareholders of the parent company by the weighted average number of
outstanding ordinary shares of the parent company:
Six months ended 30 June
2021 2020
Consolidated net profit attributable to
ordinary shareholders of the
parent company 405,214,055 207,771,782
Weighted average number of
ordinary shares outstanding
issued by the Company 863,214,000 863,214,000
Basic earnings per share 0.47 0.24
83
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(53) Earnings per share (Cont’d)
(b) Diluted earnings per share
Diluted earnings per share are calculated by dividing consolidated net profit attributable to
ordinary shareholders of the parent company adjusted based on the dilutive potential
ordinary shares by the adjusted weighted average number of outstanding ordinary shares
of the Company. As there were no dilutive potential ordinary shares in six months ended
30 June 2021 (six months ended 30 June 2020: Nil), diluted earnings per share equalled to
basic earnings per share.
(54) Notes to the cash flow statement
(a) Cash received relating to other operating activities
Six months ended 30 June
2021 2020
Government grants 334,382,070 164,857,450
Deposits from distributors 78,002,972 22,539,331
Deposits for bidding 22,377,000 28,090,361
Quality claims 277,752 530,263
Input VAT refund - 23,559,902
Others 15,919,139 6,343,077
450,958,933 245,920,384
(b) Cash paid relating to other operating activities
Six months ended 30 June
2021 2020
Research and development
expenses 271,562,707 515,676,803
Warranties 216,744,709 136,325,584
Advertising expenses 113,004,161 122,999,651
Promotion expenses 185,146,657 147,975,736
Guarantees 49,908,699 17,904,238
Maintenance expenses 44,654,150 20,729,104
Travel expenses 17,919,914 12,873,171
Others 336,429,854 255,310,888
1,235,370,851 1,229,795,175
(c) Cash received relating to other investing activities
Six months ended 30 June
2021 2020
Interest from cash at bank 116,825,862 89,946,934
Interest from acceptance notes 4,895,325 4,229,944
Interest from credit sales 1,020,809 1,983,609
Investment income from forward
79,024 611,945
exchange settlement
122,821,020 96,772,432
84
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(54) Notes to the cash flow statement (Cont’d)
(d) Cash paid relating to other financing activities
Six months ended 30 June
2021 2020
Repayments of lease liabilities 4,409,423 4,800,032
(55) Supplementary information to the cash flow statement
(a) Supplementary information to the cash flow statement
Reconciliation from net profit to cash flows from operating activities
Six months ended 30 June
2021 2020
Net profit 405,214,055 207,771,782
Add: Asset impairment losses (Note
4(44)) - 34,107,710
Credit impairment losses (Note
4(45)) (7,389,378) 66,242,811
Depreciation of fixed assets
(Note 4(10)) 433,395,705 517,638,550
Amortisation of intangible
assets (Note 4(13)) 77,362,902 58,225,513
Depreciation of right-of-use
assets (Note 4(12)) 7,354,220 7,225,828
Increase in provisions 36,150,011 32,984,461
(Income)/Losses on disposal of
long-term assets (11,008,608) 25,860,575
Financial expenses (145,788,789) (67,128,763)
Investment losses/( income)
(Note 4(47)) 10,863,242 (28,278,000)
(Gains)/losses on changes in
fair value (Note 4(48)) 5,130,493 (10,012,041)
(Increase)/decrease in deferred
tax assets (164,226,685) 2,013,602
Increase/(Decrease) in
deferred tax liabilities 15,244,406 (317,095)
(Increase)/Decrease in
inventories (139,999,996) 216,420,338
Increase in other cash and
cash equivalents (1,565,665) (49,718,600)
Increase in operating
receivables (279,516,996) (728,501,730)
Decrease/(increase) in
operating payables (171,301,068) 449,748,686
Net cash flows from operating
activities 69,917,849 734,283,627
85
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(55) Supplementary information to the cash flow statement (Cont’d)
(b) Net increase in cash
Six months ended 30 June
2021 2020
Cash at the end of the period 10,948,621,070 7,872,553,804
Less: Cash at the beginning of the
year (11,121,955,129) (8,937,936,658)
Net increase in cash (173,334,059) (1,065,382,854)
(c) Cash and cash equivalents
30 June 2021 31 December 2020
Bank deposit available for payment
at any time 10,948,621,070 11,121,955,129
(56) Monetary items denominated in foreign currency
30 June 2021
Amounts
denominated in
foreign Translation
currencies exchange rate Amounts in RMB
Long-term borrowings -
USD 425,647 6.4601 2,749,722
Other payables -
USD 18,322,398 6.4601 118,364,523
EUR 33,288 7.6862 255,858
118,620,381
86
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
5 Interests in other entities
(1) Interests in subsidiaries
Structure of the enterprise group
Subsidiaries Place of major business Place of registration Nature of business Shareholding (%) Method of acquisition
Direct Indirect
Retail, wholesale and lease of
JMCS Nanchang, Jiangxi Nanchang, Jiangxi automobiles 100% — Set up by investment
Business combinations not involving
JMCH Taiyuan, Shanxi Taiyuan, Shanxi Manufacture and sales of automobiles 100% — enterprises under common control
Retail, wholesale and lease of
SZFJ Shenzhen, Guangdong Shenzhen, Guangdong automobiles 100% — Set up by investment
Guangzhou, Guangzhou, Retail, wholesale and lease of
GZFJ Guangdong Guangdong automobiles 100% — Set up by investment
Establishment through split-off by
JMPC (i) Taiyuan, Shanxi Taiyuan, Shanxi Manufacture and sales of engines 100% — JMCH
(i) according to the resolution of the Board of Directors’ meeting on June 19, 2020, JMPC was established by split-off of JMCH. The Company
directly holds 100% equity of JMPC and JMCH respectively after the split.
87
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
5 Interests in other entities (Cont’d)
(2) Interests in associates
Summarised information of insignificant associates
Six months ended 30 June
2021 2020
Aggregated carrying amount of investments 39,232,347 37,910,003
Aggregate of the following items in proportion
Net profit (i) (264,201) (3,024,554)
Other comprehensive income (i) - -
Total comprehensive income (264,201) (3,024,554)
(i) The net profit and other comprehensive income have taken into account the impacts of both the fair value of the identifiable assets and liabilities
upon the acquisition of investment in joint ventures and associates and the unification of accounting policies adopted by the joint ventures and the
associates to those adopted by the Group.
6 Segment information
Revenue and profits of the Company mainly arise from production and domestic sales of automobiles, and the primary assets of the Group are all
located in China. Management of the Group assesses the operating performance of the Group as a whole. Therefore, no segment report is
prepared for the current period.
88
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions
(1) Information of major shareholders
(a) General information of major shareholders
Type of Place of Legal Code of
enterprise registration representative Nature of business organisation
State-owned Nanchang, Investment and asset 91360125MA
JIC enterprise China Qiu Tiangao management 38LUR91F
Ford Motor Company Foreign William Clay Manufacture and sales
(“Ford”) enterprise United States Ford, Jr. of automobiles N/A
(b) Registered capital and changes in major shareholders
31 December Increase in the Decrease in the
2020 current period current period 30 June 2021
JIC 1,000,000,000 - - 1,000,000,000
Ford USD 41,000,000 - - USD 41,000,000
(c) The percentages of shareholding and voting rights in the Company held by major
shareholders
30 June 2021 31 December 2020
Shareholding Voting rights Shareholding Voting rights
(%) (%) (%) (%)
JIC 41.03% 41.03% 41.03% 41.03%
Ford 32% 32% 32% 32%
(2) Information of subsidiaries
The general information and other related information of subsidiaries are set out in Note
5(1).
(3) Information of associates
The information of associates that have related party transactions with the Group is set out
in Note 5(2).
89
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(4) Information of other related parties
Related parties Relationship with the Group
JMCG Shareholder of JIC
Chongqing Changan Automobile Co., Ltd. Shareholder of JIC
JMCG Jingma Motors Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi Lingrui Recycling Resources Development
Wholly-owned subsidiary of JMCG
Corporation
Nanchang Gear Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangling Material Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi JMCG Industry Co., Ltd. Wholly-owned subsidiary of JMCG
Jiangxi Jiangling Chassis Co., Ltd. Wholly-owned subsidiary of JMCG
Nanchang JMCG Shishun Logistics Co., Ltd. Wholly-owned subsidiary of JMCG
JMCF Wholly-owned subsidiary of JMCG
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. Wholly-owned subsidiary of JMCG
Nanchang JMCG Xinchen Auto Component Co., Ltd. Wholly-owned subsidiary of JMCG
Jingdezhen Shishun Logistics Co., Ltd. Wholly-owned subsidiary of JMCG
Ford Global Technologies,LLC Wholly-owned subsidiary of Ford
Ford Motor (China) Co., Ltd. Wholly-owned subsidiary of Ford
Ford Motor Research & Engineering (Nanjing) Co., Ltd. Wholly-owned subsidiary of Ford
Ford Motor Co. Thailand Ltd. Wholly-owned subsidiary of Ford
Ford Otomotiv Sanayi A.S. Holding subsidiary of Ford
Auto Alliance (Thailand) Co., Ltd. Holding subsidiary of Ford
Ford Vietnam Limited Holding subsidiary of Ford
Ford Trading Company, LLC Holding subsidiary of Ford
Changan Ford Automobile Co., Ltd. Joint venture of Ford
Subsidiary under indirect control of
Nanchang JMCG Frame Co., Ltd
JMCG
Subsidiary under indirect control of
Nanchang JMCG Liancheng Auto Component Co., Ltd.
JMCG
90
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(4) Information of other related parties (Cont’d)
Related parties Relationship with the Group
Subsidiary under indirect
Nanchang Lianda Machinery Co., Ltd. control of JMCG
Subsidiary under indirect
Jiangling Aowei Automobile Spare Part Co., Ltd. control of JMCG
Subsidiary under indirect
Jiangxi JMCG Boya brake system Co., Ltd control of JMCG
Subsidiary under indirect
Jiangxi JMCG Shangrao Industrial Co., Ltd. control of JMCG
Subsidiary under indirect
NC.Gear Forging Factory control of JMCG
Subsidiary under indirect
JMCG Jiangxi Engineering Construction Co., Ltd. control of JMCG
Subsidiary under indirect
Jiangxi Yizhi Zhixing Automobile Operation Service Co., Ltd. control of JMCG
Group subsidiary of JIC’s
Guizhou Wanfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Chongqing Anfu Vehicle Marketing Co., Ltd. shareholder
Group subsidiary of JIC’s
Chengdu Wanxing Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Chongqing Anbo Vehicle Sales Co., Ltd. shareholder
Group subsidiary of JIC’s
Yunan Wanfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Dali Wanfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
China Changan Group Hefei Investing Co., Ltd. shareholder
Group subsidiary of JIC’s
Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Honghe Wanfu Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
China Changan Group Tianjin Sales Co., Ltd. shareholder
Group subsidiary of JIC’s
Anhui Wanyou Vehicle Sales & Service Co., Ltd. shareholder
Group subsidiary of JIC’s
Guizhou Wanjia Vehicle Sales & Service Co., Ltd. shareholder
Jiangxi Jiangling Lear Interior System Co., Ltd. Joint venture of JMCG
Jiangxi ISUZU Co., Ltd. Joint venture of JMCG
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Joint venture of JMCG
91
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(4) Information of other related parties (Cont’d)
Relationship with the
Related parties Group
Nanchang Unistar Electric & Electronics Co., Ltd. Joint venture of JMCG
Nanchang Yinlun Heat-exchanger Co., Ltd. Joint venture of JMCG
Jiangxi ISUZU Engine Co., Ltd. Joint venture of JMCG
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Associate of JMCG
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. Associate of JMCG
Jiangxi JMCG Specialty Vehicles Co., Ltd. Associate of JMCG
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Associate of JMCG
Nanchang JMCG Mekra-Lang Vehicle Mirror Co., Ltd. Associate of JMCG
Nanchang Baojiang Steel Processing Distribution Co., Ltd. Associate of JMCG
Magna PT Powertrain (Jiangxi) Co., Ltd. (i) Associate of JMCG
Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. Associate of JMCG
Jiangling Motor Holdings Co., Ltd. Associate of JMCG
Jiangxi Lingyun Automobile Industry Technology Co.,Ltd Associate of JMCG
Nanchang Hengou Industry Co., Ltd. Associate of JMCG
Jiujiang Fuwantong Vehicle Co., Ltd. Associate of JMCG
Jiangxi Fuxiang Vehicle Co., Ltd. Associate of JMCG
Ji'an Qingyuan District Yongfuda Vehicle Co., Ltd. Associate of JMCG
Yichun Xinfu Vehicle Co., Ltd. Associate of JMCG
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Associate of JMCG
Jiangling Motor Electricity Vehicle Co., Ltd. Associate of JMCG
Jiangxi Jiangling Group Health Science and Technology Co.,
Associate of JMCG
Ltd.
(i)In December 2020, the GETRAG (Jiangxi) Transmission Company has been renamed
to Magna PT Powertrain (Jiangxi) Co., Ltd.
92
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions
(a) Purchase and sales of goods, provision and receipt of services
Purchase of goods:
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Purchase of spare parts 559,640,678 383,892,896
Nanchang Baojiang Steel Processing Distribution Co., Ltd. Purchase of raw materials 487,650,466 405,185,757
Jiangxi Jiangling Chassis Co., Ltd. Purchase of spare parts 454,821,789 355,113,008
Magna PT Powertrain (Jiangxi) Co., Ltd. Purchase of spare parts 416,304,253 336,800,228
Ford Purchase of spare parts 406,714,749 331,917,143
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Purchase of spare parts 386,207,282 272,438,364
Jiangxi Jiangling Lear Interior System Co., Ltd. Purchase of spare parts 253,713,165 203,467,840
Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. Purchase of spare parts 204,996,379 211,129,621
Nanchang JMCG Liancheng Auto Component Co., Ltd. Purchase of spare parts 192,440,537 178,564,686
Nanchang JMCG Shishun Logistics Co., Ltd. Purchase of spare parts 186,331,354 180,731,669
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Purchase of spare parts 179,718,350 -
Nanchang Unistar Electric & Electronics Co., Ltd. Purchase of spare parts 157,062,782 130,765,035
Hanon Systems Purchase of spare parts 113,038,226 86,204,275
JMCG Purchase of spare parts 95,172,791 71,583,876
Nanchang Yinlun Heat-exchanger Co., Ltd. Purchase of spare parts 57,322,498 30,324,257
Nanchang JMCG Mekra-Lang Vehicle Mirror Co., Ltd. Purchase of spare parts 51,246,461 45,571,842
Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. Purchase of spare parts 40,864,845 32,436,589
Nanchang Lianda Machinery Co., Ltd. Purchase of spare parts 39,419,200 32,528,800
Jiangxi JMCG Specialty Vehicles Co., Ltd. Purchase of spare parts 24,377,547 20,244,154
Changan Ford Automobile Co., Ltd. Purchase of spare parts 22,322,571 16,159,043
Auto Alliance (Thailand) Co., Ltd. Purchase of spare parts 22,108,469 45,263,124
Jiangling Motor Holdings Co., Ltd. Purchase of spare parts 20,348,183 19,423,653
Jiangxi JMCG Boya brake system Co., Ltd Purchase of spare parts 17,753,794 6,169,098
93
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Purchase of goods (Cont'd):
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Jiangxi Lingyun Automobile Industry Technology Co.,Ltd Purchase of spare parts 16,903,992 5,462,414
Ford Otomotiv Sanayi A.S. Purchase of spare parts 14,985,072 25,895,662
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Purchase of spare parts 14,710,069 18,057,702
Jiangling Material Co., Ltd. Purchase of raw materials 14,381,157 10,789,819
Jiangling Aowei Automobile Spare Part Co., Ltd. Purchase of spare parts 12,432,709 9,133,485
Nanchang JMCG Xinchen Auto Component Co., Ltd. Purchase of spare parts 8,531,947 6,833,446
Jiangxi JMCG Industry Co., Ltd. Purchase of spare parts 5,555,782 270,582
Jiangxi ISUZU Engine Co., Ltd. Purchase of spare parts 5,385,785 11,670,041
NC.Gear Forging Factory Purchase of spare parts 4,600,012 3,436,975
Jiangxi Lingrui Recycling Resources Development Corporation Purchase of spare parts 3,603,406 4,876,295
Ford Motor Co. Thailand Ltd. Purchase of spare parts 1,761,533 3,620,884
Jiangxi JMCG Shangrao Industrial Co., Ltd. Purchase of spare parts 1,532,713 1,383,417
Jiangxi Jiangling Group Health Science and Technology Co., Purchase of epidemic prevention
75,752 2,214,000
Ltd. materials
Nanchang Gear Co., Ltd. Purchase of spare parts - 3,700,664
Other related parties Purchase of spare parts 378,277 3,655,968
4,494,414,575 3,506,916,312
The products purchased by the Group from related parties are divided into two categories: purchase of imported parts and purchase of domestic
parts.
The pricing on imported parts purchased from Ford or its suppliers is based on the agreed price by both parties.
The pricing on domestic accessories purchased from other related parties is determined through quotation, cost accounting, and
negotiation between the two parties, and is adjusted regularly.
94
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Receipt of services:
Six months ended 30 June
Related parties Nature of related party transactions 2021 2020
Nanchang JMCG Shishun Logistics Co., Ltd. Transportation/Truckage 183,101,437 145,365,321
Trademark management
Ford Global Technologies,LLC fees/Technical development 137,193,141 111,064,126
Engineering
JMCG Jiangxi Engineering Construction Co., Ltd. construction/Maintenance fee 91,462,137 126,634,929
Ford Engineering service/Personnel costs 45,133,925 128,825,062
Changan Ford Automobile Co., Ltd. Service fee/Labor costs, etc. 16,626,550 26,903,713
Jiangxi JMCG Industry Co., Ltd. Dinning fee 10,818,912 10,620,614
Technical service/Technical
Ford Otomotiv Sanayi A.S. development/ Personnel costs 9,025,906 13,953,012
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Transportation/Rental fee, etc. 7,759,524 2,143,309
Ford Motor (China) Co., Ltd. Personnel costs 6,622,070 5,607,007
Jiangling Motor Holdings Co., Ltd. Personnel costs/Labor costs 5,041,950 100,700
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Agent fee, etc. 4,734,392 3,720,284
Ford Motor Research & Engineering (Nanjing) Co., Ltd. Personnel costs 3,698,207 5,380,878
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Design fee/Experimental costs 2,175,305 -
Jiangxi JMCG Specialty Vehicles Co., Ltd. Promotion 1,139,648 4,099,057
Chongqing Changan Automobile Co., Ltd. Personnel costs 840,139 638,559
Magna PT Powertrain (Jiangxi) Co., Ltd. Design fee 44,000 4,551,480
Other related parties 3,706,823 3,543,314
529,124,066 593,151,365
95
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Sales of automobiles and
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. accessories 1,448,104,620 515,648,431
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. Sales of automobiles 116,350,946 247,784,771
Jiangxi Lingrui Recycling Resources Development Corporation Scrapping materials and utilities 46,091,112 37,417,132
Jiangxi Jiangling Chassis Co., Ltd. Sales of accessories 35,912,126 25,066,364
Sales of automobiles and
Jiangxi JMCG Specialty Vehicles Co., Ltd. accessories 29,087,061 116,257,012
Sales of automobiles and
JMCG Jingma Motors Co., Ltd. accessories 28,334,162 21,175,865
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. Sales of accessories 24,575,547 -
Jiangxi Jiangling Group Special Vehicle Co., Ltd. Sales of automobiles 22,609,914 19,430,202
Sales of automobiles and
Dali Wanfu Vehicle Sales & Service Co., Ltd. accessories 21,352,956 22,654,665
Sales of automobiles and
Chengdu Wanxing Vehicle Sales & Service Co., Ltd. accessories 20,425,695 3,839,113
Sales of automobiles and
Chongqing Anfu Vehicle Marketing Co., Ltd. accessories 19,801,630 5,983,015
96
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods (Cont'd):
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Sales of automobiles and
18,291,943 5,520,116
Chongqing Anbo Vehicle Sales Co., Ltd. accessories
Sales of automobiles and
12,279,634 11,258,826
Nanchang JMCG Shishun Logistics Co., Ltd. accessories
Sales of automobiles and
7,888,813 11,046,682
Guizhou Wanfu Vehicle Sales & Service Co., Ltd. accessories
Sales of automobiles and
6,759,745 8,476,498
Jiujiang Fuwantong Vehicle Co., Ltd. accessories
Sales of automobiles and
5,932,997 217,533
China Changan Group Tianjin Sales Co., Ltd. accessories
Nanchang JMCG Mekra-Lang Vehicle Mirror Co., Ltd. Sales of accessories 4,950,891 -
Nanchang JMCG Liancheng Auto Component Co., Ltd. Sales of accessories 4,850,081 20,393,560
Nanchang Hengou Industry Co., Ltd. Sales of accessories 4,575,689 3,794,800
Sales of automobiles and
3,745,325 -
Guizhou Wanjia Vehicle Sales & Service Co., Ltd. accessories
Sales of automobiles and
3,429,676 99,880,081
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. accessories, utilities
Sales of automobiles and
3,394,918 8,291,761
Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd. accessories
Jiangxi ISUZU Co., Ltd. Sales of accessories 2,382,506 151,096
Jiangxi Jiangling Lear Interior System Co., Ltd. Sales of accessories 2,376,736 2,349,992
97
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods (Cont'd):
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Sales of accessories 1,620,115 3,933,437
Sales of automobiles and
1,425,731 -
Anhui Wanyou Vehicle Sales & Service Co., Ltd. accessories
Jiangxi Yizhi Zhixing Automobile Operation Service Co., Ltd. Sales of automobiles 1,302,655 -
Sales of accessories,scrapping
1,265,886 1,532,473
Jiangxi JMCG Industry Co., Ltd. materials and utilities
Nanchang Lianda Machinery Co., Ltd. Sales of accessories 1,236,605 273,615
Sales of automobiles and
567,472 3,000,142
Yunan Wanfu Vehicle Sales & Service Co., Ltd. accessories
Sales of automobiles and
381,676 1,312,986
Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd. accessories
Sales of automobiles and
134,176 8,700,430
China Changan Group Hefei Investing Co., Ltd. accessories
Sales of automobiles and
78,516 1,962,208
Jiangxi Fuxiang Vehicle Co., Ltd. accessories, utilities
Sales of automobiles and
70,796 1,178,868
Yichun Xinfu Vehicle Co., Ltd. accessories
Sales of automobiles and
50,582 1,404,914
Ji'an Qingyuan District Yongfuda Vehicle Co., Ltd. accessories
Sales of automobiles and
47,190 1,553,651
Honghe Wanfu Vehicle Sales & Service Co., Ltd. accessories
Jingdezhen Shishun Logistics Co., Ltd. Sales of automobiles - 2,389,380
98
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(a) Purchase and sales of goods, provision and receipt of services (Cont'd)
Sales of goods (Cont'd):
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Other related parties 1,769,547 3,450,991
1,903,455,670 1,217,330,610
The Group’s pricing on goods sold to related parties is based on the agreed price by both parties.
99
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(b) Leases
(i) The lease income recognised in the current period with the Group as the lessor:
Six months ended 30 June
Name of the lessee Type of the leased asset 2021 2020
Jiangling Material Co., Ltd. Buildings 60,550 -
Jiangxi ISUZU Co., Ltd. Buildings 31,371 53,411
91,921 53,411
(ii) Increase of right-of-use assets in the current period with the Group as the lessee
Six months ended 30 June
Name of the lessor Type of the leased asset 2021 2020
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. Buildings 16,852,582 -
JMCG Buildings 182,766 -
17,035,348 -
(iii) Interest expenses on lease liabilities in the current period of the Group as the lessee:
Six months ended 30 June
2021 2020
JMCG 221,943 305,570
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 213,557 41,038
435,500 346,608
100
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(c) Guarantee received
Guarantor Guaranteed amount Starting date Ending date Fully performed or not
JMCF 2,749,722 5 March 2001 30 October 2029 Not fully performed
2021 first half-year, JMCF provided guarantees for some bank borrowings of the Group, with a maximum guarantee limit of USD2,282,123. As at
30 June 2021, JMCF provided borrowing guarantee to the bank borrowing of USD425,647, equivalent to RMB2,749,722 (31 December 2020:
USD458,389, equivalent to RMB2,990,943) for the Group.
(d) Transfer of assets
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Jiangxi JMCG Industry Co., Ltd. Sales of fixed assets - 1,447
- 1,447
The pricing on transfer of assets between the Group and related parties is based on the agreed price by both parties.
101
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(e) Purchase of assets
Six months ended 30 June
Nature of related party
Related parties transactions 2021 2020
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. Purchase of fixed assets 4,946,744 1,370,067
Magna PT Powertrain (Jiangxi) Co., Ltd. Purchase of fixed assets 2,480,000 3,480,000
Nanchang Jiangling HuaXiang Auto Components Co., Ltd. Purchase of fixed assets 444,600 -
Jiangling Motor Holdings Co., Ltd. Purchase of fixed assets - 337,660
7,871,344 5,187,727
The pricing on purchase of assets between the Group and related parties is based on the agreed price by both parties.
(f) Provision of technology sharing
Six months ended 30 June
Nature of related party
2021 2020
Related parties transactions
Ford Motor Research & Engineering (Nanjing) Co., Ltd. Technical service 24,740,000 8,290,000
Ford Vietnam Limited Technical service 12,780,000 11,123,000
Jiangxi ISUZU Co., Ltd. Technical service 4,615,000 -
Ford Technical service 3,230,000 6,974,000
Ford Trading Company, LLC Technical service 2,350,000 -
Ford Otomotiv Sanayi A.S. Technical service 340,000 -
48,055,000 26,387,000
The Group’s pricing on technology sharing provided to related parties is based on the agreed price by both parties.
102
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(5) Related party transactions (Cont’d)
(g) Purchase of fuel consumption integral acquisition
Six months ended 30 June
Related party 2021 2020
Jiangling Motor Holdings Co., Ltd. 177,528,259 -
Jiangling Motor Electricity Vehicle
11,186,318 23,315,612
Co., Ltd.
188,714,577 23,315,612
-
The Group’s pricing on fuel consumption integral purchased from related parties is based
on the agreed price by both parties.
(h) Remuneration of key management
Six months ended 30 June
2021 2020
Remuneration of key management 11,096,700 6,783,165
(i) Interest income
Six months ended 30 June
2021 2020
JMCF 9,065,202 8,942,382
103
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties
Receivables from related parties:
30 June 2021 31 December 2020
Provision for bad Provision for bad
Amount debts Amount debts
Accounts receivable
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 869,532,495 (528,716) 1,081,916,003 (2,368,381)
Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. 53,564,546 (23,176) 22,613,476 (47,488)
Jiangxi JMCG Specialty Vehicles Co., Ltd. 31,701,175 (14,811) 9,705,710 (20,997)
JMCG Jingma Motors Co., Ltd. 19,608,976 (48,948) 4,953,579 (14,861)
Jiangxi Zhonglian Intelligent Logistics Co., Ltd. 14,043,419 (35,055) - -
Nanchang JMCG Frame Co., Ltd 6,941,722 (17,328) 11,499,163 (34,497)
Ford Vietnam Limited 6,390,000 (15,951) 19,500,000 (97,500)
Jiangxi Jiangling Group Special Vehicle Co., Ltd. 3,287,145 (1,422) 3,340,025 (7,014)
Ford 3,230,000 (8,063) 6,304,000 (31,520)
Jiangxi ISUZU Co., Ltd. 2,988,138 (7,459) 1,103,086 (3,309)
Nanchang JMCG Mekra-Lang Vehicle Mirror Co., Ltd. 2,443,304 (6,099) 943,109 (2,829)
Ford Trading Company, LLC 2,350,000 (5,866) - -
Nanchang JMCG Liancheng Auto Component Co., Ltd. 1,650,455 (4,120) 8,906,500 (26,720)
Ford Motor Research & Engineering (Nanjing) Co., Ltd. 1,367,400 (3,413) 890,400 (4,452)
Nanchang Hengou Industry Co., Ltd. 1,220,975 (3,048) 394,513 (1,184)
Jiangxi Jiangling Chassis Co., Ltd. - - 4,786,897 (14,361)
Nanchang JMCG Shishun Logistics Co., Ltd. - - 4,267,697 (12,803)
Jiangxi Jiangling Lear Interior System Co., Ltd. 926,020 (2,312) 1,192,642 (3,578)
Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. 591,682 (1,477) 1,539,411 (4,618)
Other related parties 2,595,941 (5,376) 2,016,965 (6,044)
1,024,433,393 (732,640) 1,185,873,176 (2,702,156)
104
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Receivables from related parties (Cont'd):
30 June 2021 31 December 2020
Provision for bad Provision for bad
Amount debts Amount debts
Other receivables
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. 25,190,512 (75,572) 35,201,661 (105,605)
Other related parties 145,870 (445) 6,644 (20)
25,336,382 (76,017) 35,208,305 (105,625)
105
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Receivables from related parties (Cont'd):
31 December
30 June 2021 2020
Advances to Nanchang Baojiang Steel
suppliers Processing Distribution Co., Ltd. 489,145,695 355,529,951
Financing
receivables JMCG Jingma Motors Co., Ltd. 7,387,290 5,172,364
Prepayment Jiangxi Jiangling Motors Imp. &
for projects Exp. Co., Ltd. 177,160 1,239,661
Bank
balances JMCF 771,587,928 1,231,825,734
Payables to related parties:
31 December
30 June 2021 2020
Accounts Nanchang Jiangling HuaXiang Auto
payable Components Co., Ltd. 473,583,419 600,620,464
Jiangxi Jiangling Special Purpose
Vehicle Co., Ltd. 423,742,898 450,355,413
Jiangxi Jiangling Chassis Co., Ltd. 336,602,865 381,961,882
Jiangxi Jiangling Lear Interior
System Co., Ltd. 229,848,248 244,023,570
Ford 210,415,771 165,212,418
Magna PT Powertrain (Jiangxi) Co.,
Ltd. 210,393,489 257,203,673
Jiangxi Zhonglian Intelligent
Logistics Co., Ltd. 163,864,546 343,739
Nanchang JMCG Liancheng Auto
Component Co., Ltd. 153,999,210 177,586,249
Faurecia Emissions Control
Technologies (Nanchang) Co.,
Ltd. 140,062,610 140,584,875
Hanon Systems 104,228,065 119,546,495
JMCG 95,458,246 108,139,686
Nanchang Unistar Electric &
Electronics Co., Ltd. 89,113,683 107,067,804
Nanchang JMCG Shishun Logistics
Co., Ltd. 87,796,370 112,968,126
Nanchang JMCG Mekra-Lang
Vehicle Mirror Co., Ltd. 48,372,146 84,273,999
Nanchang Yinlun Heat-exchanger
Co., Ltd. 34,995,662 39,863,083
106
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Payables to related parties (Cont'd):
31 December
30 June 2021 2020
Accounts
payable Jiangxi JMCG Specialty Vehicles Co., Ltd. 27,215,029 44,095,229
Jiangxi Jiangling Group Special Vehicle
Co., Ltd. 26,854,645 17,656,588
Changan Ford Automobile Co., Ltd. 25,640,001 7,408,214
Jiangxi Lingge Non-ferrous Metal Die-
casting Co., Ltd. 22,833,969 33,997,041
Nanchang Lianda Machinery Co., Ltd. 21,647,671 31,713,777
Auto Alliance (Thailand) Co., Ltd. 12,868,698 4,294,750
Jiangling Aowei Automobile Spare Part
Co., Ltd. 11,392,207 11,243,037
Jiangxi Lingyun Automobile Industry
Technology Co.,Ltd 11,158,275 5,184,778
Jiangxi JMCG Boya brake system Co., Ltd 10,694,371 8,797,919
Jiangling Motor Holdings Co., Ltd. 9,740,676 11,635,750
Nanchang JMCG Xinchen Auto
Component Co., Ltd. 8,753,995 5,721,038
Jiangxi ISUZU Engine Co., Ltd. 5,456,011 441,696
Jiangxi Lingrui Recycling Resources
Development Corporation 3,531,531 4,814,171
Jiangxi JMCG Industry Co., Ltd. 2,870,093 1,044,850
Ford Otomotiv Sanayi A.S. 2,838,737 4,727,288
NC.Gear Forging Factory 2,524,035 921,767
Jiangling Material Co., Ltd. 1,190,978 1,955,537
Jiangxi JMCG Shangrao Industrial Co., Ltd. 845,624 1,144,320
Nanchang Gear Co., Ltd. 90,024 3,414,942
Other related parties 731,945 666,052
3,011,355,743 3,190,630,220
107
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Payables to related parties (Cont'd):
30 June 2021 31 December 2020
Other
payables Jiangling Motor Holdings Co., Ltd. 177,758,640 1,480,192
Ford Global Technologies,LLC 65,202,298 18,050,765
Ford 49,365,740 48,814,942
Jiangxi JMCG Specialty Vehicles
Sales Corporation, Ltd. 27,247,587 23,287,853
Nanchang JMCG Shishun Logistics
Co., Ltd. 11,516,681 8,370,326
Magna PT Powertrain (Jiangxi) Co.,
Ltd. 11,246,731 13,139,275
Jiangling Motor Electricity Vehicle
Co., Ltd. 11,186,318 -
Jiangxi Jiangling Group Special
Vehicle Co., Ltd. 10,905,475 10,269,987
Jiangxi Jiangling Special Purpose
Vehicle Co., Ltd. 6,194,319 1,588,791
JMCG Jiangxi Engineering
Construction Co., Ltd. 5,834,085 7,117,653
Jiangxi JMCG Specialty Vehicles
Co., Ltd. 4,243,509 3,682,741
Ford Otomotiv Sanayi A.S. 3,789,649 5,265,976
Faurecia Emissions Control
Technologies (Nanchang) Co.,
Ltd. 3,042,455 3,285,350
Jiangxi Jiangling Motors Imp. & Exp.
Co., Ltd. 2,838,809 1,456,956
Nanchang Baojiang Steel
Processing Distribution Co., Ltd. 2,722,060 1,944,877
Chongqing Changan Automobile
Co., Ltd. 2,621,234 1,781,095
Ford Motor (China) Co., Ltd. 2,134,987 2,570,952
Jiangxi JMCG Industry Co., Ltd. 1,903,507 3,726,567
Changan Ford Automobile Co., Ltd. 1,491,634 18,503,441
Hanon Systems 1,475,000 1,475,000
Ford Motor Research & Engineering
(Nanjing) Co., Ltd. 1,284,159 1,345,255
Jiangxi Jiangling Lear Interior
System Co., Ltd. 1,207,000 1,207,000
Nanchang Jiangling HuaXiang Auto
Components Co., Ltd. 951,859 2,481,859
JMCG - 2,313,728
Other related parties 4,232,871 5,600,327
. 410,396,607 188,760,908
108
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Cont'd)
(6) Receivables from and payables to related parties (Cont’d)
Payables to related parties (Cont'd):
31 December
30 June 2021 2020
Contract
liabilities Other related parties 1,402,307 2,191,137
Lease
liabilities Jiangxi Jiangling Motors Imp. &
Exp. Co., Ltd. 17,066,139 -
JMCG 8,135,282 9,033,918
25,201,421 9,033,918
(7) Commitments in relation to related parties
Capital commitments 30 June 2021 31 December 2020
JMCG Jiangxi Engineering
Construction Co., Ltd. 195,204,618 377,223,784
Guarantee of commitments in relation to related parties is set out in Note 7(5)(c).
8 Contingencies
As at 30 June 2021, the Group had no contingencies that needed to be accounted for in
the notes to the financial statements.
9 Commitments
Capital expenditure commitments
Capital expenditures contracted by the Group but are not yet necessary to be presented on
the balance sheet as at the balance sheet date are as follows:
30 June 2021 31 December 2020
Buildings, machinery and equipment 823,830,000 1,127,750,000
109
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
10 Events after the balance sheet date
(1) Disposal of equity in subsidiary
The Company and Yunnan Yunnei Power Group Co., Ltd. signed the relevant equity
transaction contract in accordance with the relevant trading rules of Shanghai United
Property Rights Exchange. As of the disclosure date of this report, the relevant equity
trading is still in process.
By consensus, the company has signed the corresponding equity transfer agreement for
the sale of 100% equity of JMCH to Volvo Lastvagnar Aktiebolag. As of the disclosure
date of this report, the relevant equity trading is still in process.
11 Financial instrument and risk
The Group's activities expose it to a variety of financial risks, which mainly comprise
market risk (primarily including foreign exchange risk and interest rate risk), credit risk and
liquidity risk. The above financial risks and the Group's risk management policies to
mitigate the risks are as follows:
The Board of Directors is responsible for planning and establishing the Group's risk
management framework, formulating the Group's risk management policies, and
supervising the implementation of risk management measures. The Group has established
risk management policies to identify and analyse the risks faced by the Group. These risk
management policies specify the risks such as market risk, credit risk and liquidity risk
management. The Group regularly evaluates the market environment and changes in the
Group's operating activities to determine whether to update the risk management policies
or not. The Group's risk management is carried out under policies approved by the Board
of Directors. The business departments of the Group work closely to identify and evaluate
related risks, and determine countermeasures with management to avoid or reduce the
adverse impact of the related risks on the Company. The internal audit department of the
Group conducts periodical audit to the controls and procedures for risk management and
reports the audit results to the Risk Management Committee of the Group.
(1) Market risk
(a) Foreign exchange risk
The Group’s major operational activities are carried out in Mainland China and a majority
of the transactions are denominated in RMB. The Group is exposed to foreign exchange
risk arising from the recognised assets and liabilities, and future transactions denominated
in foreign currencies, primarily with respect to USD. The Group monitors the amount of
assets and liabilities, and transactions denominated in foreign currencies to minimise the
foreign exchange risk. Therefore, the Group signed forward exchange contracts to mitigate
the foreign exchange risk (Note 4(17)).
110
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(1) Market risk (Cont’d)
(a) Foreign exchange risk (Cont’d)
The financial assets and the financial liabilities denominated in foreign currencies, which
are held by the Company and the subsidiaries of the Group, whose recording currencies
were RMB, were expressed in RMB as at 30 June 2021 and 31 December 2020 as
follows:
30 June 2021
USD EUR Total
Financial liabilities denominated in
foreign currency -
Derivative financial liabilities 8,165,742 - 8,165,742
Current portion of long-term borrowings 423,034 - 423,034
Long-term borrowings 2,326,688 - 2,326,688
Other payables 118,364,523 255,858 118,620,381
129,279,987 255,858 129,535,845
31 December 2020
USD EUR Total
Financial liabilities denominated in
foreign currency -
Derivative financial liabilities 3,716,727 - 3,716,727
Current portion of long-term
borrowings 427,277 - 427,277
Long-term borrowings 2,563,666 - 2,563,666
Other payables 70,936,756 1,469,682 72,406,438
77,644,426 1,469,682 79,114,108
As at 30 June 2021, if the RMB had strengthened/weakened by 10% against the USD
while all other variables had been held constant, the Group’s net profit would have been
approximately RMB10,988,799 (31 December 2020: approximately RMB6,599,776)
higher/lower for the financial assets and liabilities dominated in foreign currencies whose
recording currency is RMB; if the RMB had strengthened/weakened by 10% against the
EUR while all other variables had been held constant, the Group’s net profit would have
been approximately RMB21,748 higher/lower (31 December 2020: approximately
RMB142,961).
(b) Interest rate risk
The Group's interest rate risk mainly arises from interest-bearing debts such as short-term
loans and long-term bank loans. The financial liabilities of floating interest rate expose the
Group to cash flow interest rate risk, and the financial liabilities of fixed interest rate
expose the Group to fair value interest rate risk. The Group determines the relative
proportions of fixed-rate and floating-rate contracts based on the prevailing market
environment. As of June 30, 2021, the Group’s short-term borrowings of RMB500,000,000
(December 31, 2020: RMB500,000,000) are fixed-rate borrowings, and long-term
borrowings of USD 425,647 (December 31, 2020: USD 458,389) are fixed-rate
borrowings, therefor no significant cash flow interest rate risk.
As at 30 June 2021 and 31 December 2020, no significant difference between the fair
value and the carrying amount of the Group’s borrowings with fixed-rate.
111
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(2) Credit risk
The Group’s credit risk mainly arises from cash and cash equivalent, notes receivable,
accounts receivable, financial assets held for trading, other receivables and derivative
financial assets at fair value through profit or loss that are not included in the impairment
assessment scope. The carrying amount of the Group’s financial assets reflects its
maximum credit exposure on the balance sheet date.
The Group expects that there is no significant credit risk associated with cash at bank and
on hand since they are deposited at state-owned banks and other medium or large size
listed banks with good reputation and high credit rating. The Group does not expect that
there will be significant losses from non-performance by these banks.
In addition, the Group has policies to limit the credit exposure on notes receivable,
accounts receivable, financing receivables and other receivables. The Group assesses the
credit quality of and sets credit limits on its customers by taking into account their financial
position, the availability of guarantee from third parties, their credit history and other factors
such as current market conditions. The credit history of the customers is regularly
monitored by the Group. In respect of customers with a poor credit history, the Group will
use written payment reminders, or shorten or cancel credit periods, to ensure the overall
credit risk of the Group is limited to a controllable extent.
As at 30 June 2021, the Group had no significant collateral or other credit enhancements
held as a result of the debtor’s mortgage (31 December 2020: Nil).
(3) Liquidity risk
Cash flow forecasting is performed by each subsidiary of the Group and aggregated by the
Group. The Group monitors rolling forecasts of its short-term and long-term liquidity
requirements to ensure it has sufficient cash and securities that are readily convertible to
cash to meet operational needs, while maintaining sufficient headroom on its undrawn
committed borrowing facilities from major financial institutions so that the Group does not
breach borrowing limits or covenants on any of its borrowing facilities to meet the short-term
and long-term liquidity requirements.
On the balance sheet date, the undiscounted contractual cash flows of various financial
liabilities of the Group are listed as follows based on the maturity date:
30 June 2021
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
short-term
borrowing
—principal 500,000,000 - - - 500,000,000
—interest - - - - -
Derivative financial
liabilities 8,165,742 - - - 8,165,742
Accounts payable 9,408,546,403 - - - 9,408,546,403
Other payables 8,024,900,054 - - - 8,024,900,054
Lease liabilities 17,841,592 18,735,104 10,272,078 - 46,848,774
Long-term
borrowings -
- Principal 423,034 423,034 1,269,102 634,552 2,749,722
- Interest 39,659 33,314 61,869 9,518 144,360
17,959,916,484 19,191,452 11,603,049 644,070 17,991,355,055
112
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Cont’d)
(3) Liquidity risk (Cont’d)
31 December 2020
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
short-term
borrowing 500,000,000 - - - 500,000,000
—principal 2,173,333 - - - 2,173,333
—interest 3,716,727 - - - 3,716,727
Derivative financial
liabilities 10,026,215,877 - - - 10,026,215,877
Accounts payable 4,153,849,625 - - - 4,153,849,625
Other payables 11,683,625 11,419,366 8,646,930 - 31,749,921
Lease liabilities
Long-term
borrowings 427,277 427,277 1,281,833 854,556 2,990,943
- Principal 43,262 36,853 72,103 16,023 168,241
14,698,109,726 11,883,496 10,000,866 870,579 14,720,864,667
(i) As at June 30, 2021, the lease payment related to the lease contract that the Group has
signed but has not yet begun to execute as follows(Note 4(27)(a))(December 31, 2020:RMB
361,843,200):
30 June 2021
Within 1 year 1 to 2 years 2 to 5 years Total
Future
contractual
cash flows not
included in
lease liabilities 72,368,640 72,368,640 217,105,920 361,843,200
12 Fair value estimates
The level in which fair value measurement is categorised is determined by the level of the
fair value hierarchy of the lowest level input that is significant to the entire fair value
measurement:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
113
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis
As at 30 June 2021, the assets measured at fair value on a recurring basis by the above
three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial assets -
Financial assets held
for trading-
Structured deposits - - 553,211,507 553,211,507
Financing receivables-
Notes receivables - - 428,573,213 428,573,213
- - 981,784,720 981,784,720
As at 30 June 2021, the liabilities measured at fair value on a recurring basis by the above
three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial liabilities -
Derivative financial
liabilities-
Forward foreign
exchange contract - 8,165,742 - 8,165,742
As at 31 December 2020, the assets measured at fair value on a recurring basis by the
above three levels were analysed below:
Level 1 Level 2 Level 3 Total
Structured deposits - 803,892,985 803,892,985
Financial assets -
Financing receivables
Notes receivables - - 815,583,669 815,583,669
- - 1,619,476,654 1,619,476,654
As at 31 December 2020, the liabilities measured at fair value on a recurring basis by the
above three levels were analysed below:
Level 1 Level 2 Level 3 Total
Financial liabilities -
Derivative financial
liabilities
Forward foreign
exchange contract - 3,716,727 - 3,716,727
114
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont’d)
The Group takes the date on which events causing the transfers between the levels take
place as the timing specific for recognising the transfers. There is no transfer between
Level 1 and Level 2 for the current period.
The fair value of financial instruments traded in an active market is determined at the
quoted market price; and the fair value of those not traded in an active market is
determined by the Group using valuation technique. The valuation models used mainly
comprise discounted cash flow model and market comparable corporate model. The inputs
of valuation technique mainly include risk-free interest rate, benchmark rate, exchange
rate, etc.
115
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont'd)
The changes in Level 3 financial assets are analysed below:
Changes in unrealised
gains or losses included in
profit or loss in 2021 with
respect to assets still held
as at 30 June 2021 - gains
Gains recognised in or losses on changes in fair
31 December 2020 Increase Decrease 30 June 2021 profit or loss (a) value
Financial assets
Financial assets held for
trading -
Monetary fund - 500,000,000 (500,000,000) - 198,622 -
Structural deposits 803,892,985 1,099,318,522 (1,350,000,000) 553,211,507 10,005,970 (681,478)
Financing receivables -
Notes receivable 815,583,669 1,581,300,701 (1,968,311,157) 428,573,213 - -
Total assets 1,619,476,654 3,180,619,223 (3,818,311,157) 981,784,720 10,204,592 (681,478)
(a) Gains recognised in profit or loss is recognised in investment income in the income statement.
116
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(1) Assets and liabilities measured at fair value on a recurring basis (Cont'd)
The changes in Level 3 financial assets are analysed below (Cont'd):
Changes in unrealised
gains or losses included in
profit or loss in 2020 with
respect to assets still held
as at 31 December 2020 -
Gains recognised in gains or losses on
31 December 2019 Increase Decrease 31 December 2020 profit or loss (a) changes in fair value
Financial assets
Financial assets held for
trading -
Monetary fund - 500,000,000 (500,000,000) - 244,059 -
Structural deposits - 15,610,892,985 (14,807,000,000) 803,892,985 77,605,603 3,892,985
Financing receivables -
Notes receivable 289,044,373 2,325,165,208 (1,798,625,912) 815,583,669 - -
Total assets 289,044,373 18,436,058,193 (17,105,625,912) 1,619,476,654 77,849,662 3,892,985
(a) Gains recognised in profit or loss is recognised in investment income in the income statement.
117
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
12 Fair value estimates (Cont’d)
(2) Assets measured at fair value on a non-recurring basis
As at 30 June 2021 and 31 December 2020, the Group did not have assets measured at
fair value on a non-recurring basis.
(3) Assets and liabilities not measured at fair value but for which the fair value is disclosed
The Group’s financial assets and liabilities measured at amortised cost mainly comprise
notes receivable, accounts receivable, other receivables, short-term borrowing, account
payables, long-term borrowings, etc.
The carrying amount of the Group's financial assets and liabilities not measured at fair
value is a reasonable approximation of their fair value.
The fair value of long-term borrowings is the present value of the contractually determined
stream of future cash flows discounted at the rate of interest applied at that time by the
market to instruments of comparable credit status and providing substantially the same
cash flows on the same terms, and categorised within Level 3 of the fair value hierarchy.
13 Capital management
The Group’s capital management policies aim to safeguard the Group’s ability to continue
as a going concern in order to provide returns for shareholders and benefits for other
stakeholders, and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of
dividends paid to shareholders, refund capital to shareholders, issue new shares or sell
assets to reduce debts.
The Group's total capital is calculated as “shareholders equity” as shown in the
consolidated balance sheet. The Group is not subject to external mandatory capital
requirements, and monitors capital on the basis of equity ratio.
As at 30 June 2021 and 31 December 2020, the Group's equity ratio was as follows:
30 June 2021 31 December 2020
Total borrowings 502,749,722 502,990,943
Total equities 8,391,156,200 10,986,474,009
Equity ratio 5.99% 4.58%
118
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements
(1) Accounts receivable
30 June 2021 31 December 2020
Accounts receivable 3,278,994,400 3,502,761,954
Less: Provision for bad debts (170,482,313) (171,881,303)
3,108,512,087 3,330,880,651
(a) The ageing of accounts receivable is analysed as follows:
30 June 2021 31 December 2020
Within 1 year 2,841,807,874 3,043,074,741
1 to 2 years 5,027,969 5,223,812
2 to 3 years 400,079,957 454,463,401
Overdue over 3 years 32,078,600 -
3,278,994,400 3,502,761,954
(b) As at 30 June 2021, the five largest accounts receivable aggregated by debtor were
analysed as follows:
Amount of
provision for bad % of total
Balance debts balance
Company 1 1,714,945,725 - 52.30%
Company 2 860,205,437 (499,576) 26.23%
Company 3 147,567,312 - 4.50%
Company 4 72,480,000 (72,480,000) 2.21%
Company 5 53,938,618 (134,642) 1.64%
2,849,137,092 (73,114,218) 86.88%
(c) Provision for bad debts
For accounts receivable, irrespective of whether a significant financing component exists,
the Company measures the loss provision according to the lifetime expected credit losses.
119
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(i) Accounts receivable for which provision for bad debts is made on the individual basis are
analysed as follows:
30 June 2021
Book balance Provision for bad debts
Provision for bad
Amount Lifetime ECL (%) debts
Receivables from related
parties within the Group i) 1,862,632,705 - -
New energy subsidies
receivable ii) 84,903,126 100% (84,903,126)
Accounts receivable for
automobiles iii) 72,480,000 100% (72,480,000)
2,020,015,831 (157,383,126)
31 December 2020
Book balance Provision for bad debts
Provision for bad
Amount Lifetime ECL (%) debts
Receivables from related
parties within the Group i) 1,775,196,875 - -
New energy subsidies
receivable ii) 84,903,126 100% (84,903,126)
Accounts receivable for
automobiles iii) 74,480,000 100% (74,480,000)
1,934,580,001 (159,383,126)
i) As at 30 June 2021, the Company's accounts receivable due from subsidiaries JMCS,
SZFJ and JMPC were RMB1,714,945,725, RMB147,567,312 and RMB119,668
respectively, totalling to RMB1,862,632,705. The Company carried out individual
assessment on receivables from subsidiaries. Based on the judgement of credit risk, there
is no significant credit risk on receivables from subsidiaries, and there is no overdue or
impairment.
As at 31 December 2020, the Company's accounts receivable from subsidiaries JMCS,
JMCH and GZFJ were RMB1,605,066,624, RMB167,353,472 and RMB2,776,779
respectively, totalling to RMB1,775,196,875. The Company carried out individual
assessment on receivables from subsidiaries. Based on the judgement of credit risk, there
is no significant credit risk on receivables from subsidiaries, and there is no overdue or
impairment.
ii) As at 30 June 2021, state subsidies for new energy automobiles receivable amounted to
RMB84,903,126 (31 December 2020: RMB84,903,126). As the corresponding new energy
vehicles may not meet the corresponding subsidy policy standards, the Company
considered the receivables cannot be collected, therefore, full provision was made for
those receivables.
iii) As at 30 June 2021 and 31 December 2020, since these companies in debts were
involved in several legal proceedings, the Company considered that it was difficult to
recover such receivables, therefore, full provision was made for those receivables.
120
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows:
Grouping - Sales of general automobiles:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 838,332,166 0.04% (374,072)
Overdue for 1 to 30 days 7,584,372 0.07% (5,426)
Overdue for 31 to 60 days 119,425 2.59% (3,092)
846,035,963 (382,590)
Grouping - Sales of general automobiles:
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 1,096,348,057 0.21% (2,303,427)
Overdue for 1 to 30 days 70,701,614 0.21% (148,544)
Overdue for 31 to 60 days 345,798 6.35% (21,961)
1,167,395,469 (2,473,932)
Grouping - Sales of new energy automobiles:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 122,873,663 5.01% (6,160,075)
Overdue for 1 to 30 days - - -
Overdue for 31 to 60 days - - -
Overdue for 61 to 90 days - - -
Overdue over 90 days 23,243,550 25.34% (5,890,472)
146,117,213 (12,050,547)
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 138,042,462 4.94% (6,826,200)
Overdue for 1 to 30 days - — -
Overdue for 31 to 60 days 23,243,550 10.25% (2,381,426)
161,286,012 (9,207,626)
121
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(1) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
(ii) Accounts receivable for which provision for bad debts is made on the grouping basis are
analysed as follows (Cont’d):
Grouping - spare parts:
30 June 2021
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 266,825,393 0.25% (666,050)
31 December 2020
Book balance Provision for bad debts
Amount Lifetime ECL (%) Amount
Not overdue 206,087,099 0.30% (618,261)
Overdue for 1 to 30 days 19,968,933 0.30% (59,907)
Overdue for 31 to 60 days 10,595,310 0.50% (52,977)
Overdue for 61 to 90 days 1,295,045 0.60% (7,770)
Overdue over 90 days 1,554,085 5.00% (77,704)
239,500,472 (816,619)
(iii) The provision for bad debts in the current period amounted to RMB601,010, and
RMB2,000,000 was reversed. The significant amounts reversed were as follows:
Basis and justification for Reasons for
Reasons for determining the provision for bad Amount of reversal/
reversal/recovery debts reversal recovery
The aforesaid companies in debts
had difficulties in operation and
The actual were involved in several legal
receipt of account proceedings, so the Group
receivables relating considered that it was difficult to
to the provision for recover such receivables, so
Accounts bad debts made in related provision for bad debts
receivable 1 the prior period. was made in full amount. 2,000,000 Received
(d) In the six months ended 30 June 2021, no accounts receivable had been written off.
(e) As at 30 June 2021 and 31 December 2020, the Company did not have accounts
receivable that were pledged.
122
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables
30 June 2021 31 December 2020
Interest receivable from cash at bank 67,457,831 49,458,968
Receivables from JMCH 44,679,410 1,247,724,942
Import working capital advances 25,000,000 35,000,000
Deposits receivable 8,897,131 7,072,745
Advances for research and
development projects 5,160,914 4,559,669
Cash advance 696,898 680,403
Others 90,199,732 15,599,236
242,091,916 1,360,095,963
Less: Provision for bad debts (389,874) (188,740)
241,702,042 1,359,907,223
(a) The ageing of other receivables is analysed as follows:
30 June 2021 31 December 2020
Within 1 year 236,912,421 1,359,304,567
Over 1 year 5,179,495 791,396
242,091,916 1,360,095,963
123
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont'd)
(b) Provision for losses and changes in book balance statements
Stage 1 Stage 3
12-month ECL (grouping) 12-month ECL (individual) Sub-total Lifetime ECL (credit impaired) Total
Provision for Provision for Provision for Provision for Provision for
Book balance bad debts Book balance bad debts bad debts Book balance bad debts bad debts
31 December 2020 112,371,021 (188,740) 1,247,724,942 - (188,740) - - (188,740)
Balance increase/(decrease) in
the current period 85,041,485 - (1,203,045,532) - - - - -
Provision for bad debts in the
current period - (201,134) - - (201,134) - - (201,134)
30 June 2021 197,412,506 (389,874) 44,679,410 - (389,874) - - (389,874)
As at 30 June 2021, the Group had no other receivables transferred from Stage 1 to Stage 3, and no other receivables reversed from Stage 3 to
Stage 1.
124
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d)
As at 30 June 2021 and 31 December 2020, the Company did not have any other
receivables at Stage 2. Other receivables at Stage 1 and Stage 3 were analysed below:
(i) As at 30 June 2021 and 31 December 2020, provision for bad debts of other receivables
on the individual basis was analysed as follows:
30 June 2021
12-month Provision for
Stage 1 Book balance ECL (%) bad debts Reason
Receivables from JMCH 44,679,410 - - i)
31 December 2020
12-month Provision for
Stage 1 Book balance ECL (%) bad debts Reason
Receivables from JMCH 1,247,724,942 - - i)
i) As at 30 June 2021, the Company’s other receivables from subsidiary JMCH were
RMB44,679,410 (31 December 2020: RMB1,247,724,942). The Company carried out
individual assessment on receivables from subsidiaries. Based on the judgement of credit
risk, there is no significant credit risk on receivables from subsidiaries, and there is no
overdue or impairment.
125
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont'd)
(b) Provision for losses and changes in book balance statements (Cont’d)
(ii) As at 30 June 2021 and 31 December 2020, the Company’s other receivables with
provision for bad debts on the grouping basis were analysed below:
Other receivables with provision on the grouping basis at Stage 1:
30 June 2021 31 December 2020
Book balance Provision for losses Book balance Provision for losses
Provision Provision
Amount ratio Amount Amount ratio Amount
Grouping of
interest
receivable from
cash at bank i):
Within 1 year 67,457,831 - - 49,458,968 - -
Grouping of
operating
advances and
guarantees:
Within 1 year 124,775,180 0.30% (374,326) 62,120,657 0.30% (186,365)
Over 1 year 5,179,495 0.30% (15,548) 791,396 0.30% (2,375)
197,412,506 (389,874) 112,371,021 (188,740)
As at 30 June 2021 and 31 December 2020, the Company’s interest receivable from cash
at bank mainly came from four major state-owned banks or national joint-stock banks.
Therefore, the Company expected there was no significant loss on related interest
receivable from non-performance by these banks.
As at June 30, 2021, the Company has no other receivables in the second and third stage.
(c) In the six months ended 30 June 2021, the amount of bad debt provision was RMB
201,134.
(d) In the six months ended 30 June 2021, no other receivables had been written off.
(e) As at 30 June 2021, the five largest other receivables aggregated by debtor were analysed
as follows:
% of total Provision for
Nature Balance Ageing balance bad debts
Subsidiary
Company 1 trading 44,679,410 Within 1 year 18.46% -
Assets
Company 2 receivables 32,555,714 Within 1 year 13.45% (97,667)
Expenses
Company 3 advances 25,190,512 Within 1 year 10.41% (75,572)
Assets
Company 4 receivables 18,513,359 Within 1 year 7.65% (55,540)
Assets
Company 5 receivables 11,955,220 Within 1 year 4.94% (35,866)
132,894,215 54.91% (264,645)
126
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(3) Long-term equity investments
30 June 2021 31 December 2020
Subsidiaries (a) 3,293,943,493 2,048,000,000
Associates (b) 39,232,347 39,496,548
3,333,175,840 2,087,496,548
Less: Provision for impairment of long-term equity investments (526,000,000) (526,000,000)
2,807,175,840 1,561,496,548
(a) Subsidiaries
Changes in the current period
Balance of Cash
provision for dividends
31 December Debt Provision for impairment declared this
2020 Split-off exemption impairment 30 June 2021 In 30 June 2021 period
JMCH 852,000,000 1,142,000,000 103,943,493 - 2,097,943,493 (526,000,000) -
JMCS 50,000,000 - - - 50,000,000 - -
SZFJ 10,000,000 - - - 10,000,000 - -
GZFJ 10,000,000 - - - 10,000,000 - -
JMPC 600,000,000 - - - 600,000,000 - -
1,522,000,000 1,142,000,000 103,943,493 - 2,767,943,493 (526,000,000) -
127
JIANGLING MOTORS CORPORATION, LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(3) Long-term equity investments (Cont’d)
(a) Subsidiaries (Cont’d)
(i) In January 2021, the Company increased the share capital of JMCH by RMB 1,142 million
in cash.
(ii) In January 2021, greed by the Company and JMCH, the Company exempted the debt of
RMB103,943,493 from JMCH.
(b) Associates
Refer to Note 4(9).
128
JIANGLING MOTORS CORPORATION, LTD.
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(4) Revenue and cost of sales
Six months ended 30 June
2021 2020
Revenue from main business 16,109,269,826 12,901,713,333
Revenue from other business 314,288,655 198,396,600
16,423,558,481 13,100,109,933
Six months ended 30 June
2021 2020
Cost of sales from main business 14,248,936,203 11,010,954,908
Cost of sales from other business 293,290,780 186,559,118
14,542,226,983 11,197,514,026
(a) Revenue and cost of sales from main business
Six months ended 30 June
2021 2020
Revenue from Cost of sales from Revenue from Cost of sales from
main business main business main business main business
Sales of automobiles 15,039,210,401 13,448,227,943 12,091,989,040 10,397,191,187
Sales of spare parts 983,532,314 742,735,696 771,758,926 572,162,496
Automobile
maintenance
services 86,527,111 57,972,564 37,965,367 41,601,225
16,109,269,826 14,248,936,203 12,901,713,333 11,010,954,908
(b) Revenue and cost of sales from other business
Six months ended 30 June
2021 2020
Revenue from Cost of sales from Revenue from Cost of sales from
other business other business other business other business
Sales of materials 257,777,393 238,667,848 157,745,817 149,930,871
Others 56,511,262 54,622,932 40,650,783 36,628,247
314,288,655 293,290,780 198,396,600 186,559,118
129
JIANGLING MOTORS CORPORATION, LTD.
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Cont’d)
(4) Revenue and cost of sales (Cont’d)
(c) The breakdown of revenue earned in 2021 was as follows:
Six months ended 30 June 2021
Automobile
maintenance Materials and
Automobiles Spare parts services others Total
Revenue from main 15,039,210,401 983,532,314 86,527,111 - 16,109,269,826
business
Including: Recognised at
a time point 15,039,210,401 983,532,314 - - 16,022,742,715
Recognised
within a certain
period - - 86,527,111 - 86,527,111
Revenue from other
business - - - 314,288,655 314,288,655
15,039,210,401 983,532,314 86,527,111 314,288,655 16,423,558,481
(i) As at 30 June 2021, the amount of revenue corresponding to the performance obligation of
the Company that had been contracted but not yet performed or not fulfilled was
RMB137,930,962, which was expected to be recognised between 2021 and 2026.
(5) Investment income
Six months ended 30 June
2021 2020
Investment income from financial
assets held for trading 3,894,457 32,619,541
Investment loss from forward
exchange settlement (7,750,384) (1,316,987)
Investment income from long-term
equity investment under equity
method (264,201) (3,024,554)
Losses on discounts for financing
receivables (498,879) -
(4,619,007) 28,278,000
There is no significant restriction on the remittance of investment income to the Company.
130
JIANGLING MOTORS CORPORATION, LTD.
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
1 Statement of non-recurring profit or loss
Six months ended 30 June
2021 2020
Profit or loss on disposal of non-
current assets 11,008,608 (25,860,575)
Government grants recognised in
profit or loss for the current period 335,052,961 165,679,468
Gains and losses arising from
changes in fair value of financial
assets and liabilities held at fair
value through profit or loss, and
investment gains and losses from
disposal of related financial assets
and liabilities (2,676,284) 41,314,596
Fund occupation fee received from
non-financial institutions 7,142,859 4,740,888
Reversal of provision for impairment
of receivables tested individually 2,000,000 -
Net amount of other non-operating
income and expenses 68,869 (1,400,440)
Other profit and loss items that meet
the definition of non-recurring
profit and loss (5,423,293) -
347,173,720 184,473,937
Effect of income tax (55,801,540) (26,053,489)
Effect of gains and losses on
minority interests (net of tax) - -
291,372,180 158,420,448
Basis for preparation of statement of non-recurring profit or loss
Under the requirements in the Explanatory Announcement No. 1 on Information Disclosure
by Companies Offering Securities to the Public - Non-recurring Profit or Loss [2008] from
CSRC, non-recurring profit or loss refers to that arises from transactions and events that
are not directly relevant to ordinary activities, or that are relevant to ordinary activities, but
are extraordinary and not expected to recur frequently that would have an influence on
users of financial statements making economic decisions on the financial performance and
profitability of an enterprise.
131
JIANGLING MOTORS CORPORATION, LTD.
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2 Return on net assets and earnings per share
Weighted average Earnings per share
return on net assets Basic earnings per Diluted earnings per
(%) share share
Six months ended 30 June
2021 2020 2021 2020 2021 2020
Net profit attributable to
ordinary shareholders of
the Company 3.62% 1.96% 0.47 0.24 0.47 0.24
Net profit attributable to
ordinary shareholders of
the Company, net of non-
recurring profit or loss 1.02% 0.47% 0.13 0.06 0.13 0.06
132
