2012 Annual Report of Anhui Gujing Distillery Company Limited
ANHUI GUJING DISTILLERY COMPANY LIMITED
2012 Annual Report
April 2013
1
2012 Annual Report of Anhui Gujing Distillery Company Limited
SectionI.ImportantReminders,Catalogue&Explanation
The Board of Directors, the Supervisory Committee, directors, supervisors and senior management staff of Anhui Gujing Distillery
Company Limited (hereinafter referred to as “the Company”) warrant that this report does not contain any false record or misleading
statement or omit any material fact and shall hereby accept, individually and collectively, responsibility for the factuality, accuracy
and completeness of the contents carried in this report.
Yu Lin, company principal, Ye Changqing, chief of the accounting work, and Xia Xueyun, chief of the accounting organ (chief of
accounting), hereby confirm that the Financial Report enclosed in this report is factual, accurate and complete.
All directors have attended the board session for reviewing this report.
The Company’s profit allocation preplan upon review and approval of this board session: Based on the total shares of the Company
as at 31 Dec. 2012, a cash dividend of RMB 5.00 (tax included) will be distributed for every 10 shares held by shareholders. No
bonus shares will be granted and no capital reserve will be turned into share capital.
The report relates to the future plans of forward-looking statements, does not constitute a company on the substantial commitment of
investors, please investors pay attention to investment risk.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Catalogue
Section I. Important Reminders, Catalogue & Explanation ........... 2
Section II. Company Profile ........................................................... 6
Section III. Accounting & Financial Highlights............................. 8
Section IV. Report of the Board of Directors ............................... 12
V. Significant Events .................................................................... 31
Section VI. Changes in Share Capital and Particulars about
Shareholders ................................................................................. 35
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Explanation
Refers
Term Contents
to
Refers
Company, the Company, Gu Jing Anhui Gujing Distillery Company Limited
to
Refers
Group, the Group Anhui Gujing Distillery Company Limited (consolidated)
to
Refers
Gujing Group Anhui Gujing Group Co., Ltd.
to
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Reminder of Major Risks
1. China Securities Journal, Securities Times, Ta Kung Pao (HK) and www.cninfo.com.cn are designated by the Company as the
media for information disclosure. All information of the Company shall be subject to what is disclosed by the Company on the said
media. And Investors are kindly reminded to pay attention to possible investment risks.
2. This report is prepared in both Chinese and English. Should there be any understanding discrepancy between the two versions, the
Chinese version shall prevail.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
SectionII.CompanyProfile
I. Basic information of the Company
Stock abbreviation GJGJ, GJGB Stock code 000596, 200596
Stock exchange listed with Shenzhen Stock Exchange
Chinese name of the Company 安徽古井贡酒股份有限公司
Abbr. of the Chinese name of
古井
the Company
English name of the Company
ANHUI GUJING DISTILLERY COMPANY LIMITED
(if any)
Abbr. of the English name of
GU JING
the Company (if any)
Legal representative of the
Yu Lin
Company
Registered address Gujing Town, Bozhou City, Anhui Province
Postal code for the registered
236820
address
Office address Gujing Town, Bozhou City, Anhui Province
Postal code for the office
236820
address
Internet website of the
http://www.gujing.com
Company
Email address gjzqb@gujing.com.cn
II. For Contact
Company Secretary Securities Affairs Representative
Name Ye Changqing Ma Junwei
Gujing Town, Bozhou City, Anhui Gujing Town, Bozhou City, Anhui
Contact address
Province Province
Tel. （0558）5712231 （0558）5710057
Fax （0558）5317706 （0558）5317706
E-mail ycq@gujing.com.cn gjzqb@gujing.com.cn
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2012 Annual Report of Anhui Gujing Distillery Company Limited
III. About information disclosure and where this report is placed
Newspapers designated by the Company for
China Securities Journal, Securities Times, Ta Kung Pao (HK)
information disclosure
Internet website designated by CSRC for
http://www.cninfo.com.cn
disclosing this report
Where this report is placed Company Secretary Office
IV. Change of the registered information
Registration code of
Registration date Registration place Business license No. Organizational code
taxation
Industrial &
Commercial
Initial registration 30 May 1996 Administration 14897271-1 341600151940008 15194000-8
Bureau of Anhui
Province
Industrial &
Commercial
At the end of the
9 Jul. 2012 Administration 340000400001632 341600151940008 15194000-8
reporting period
Bureau of Anhui
Province
V. Other information
The CPAs firm hired by the Company:
Name RSM China Certified Public Accountants
3-9 F, West Tower, China Overseas Property Plaza, Building No. 7, Courtyard No. 8, Xi Binhe
Office address
Road, Yong Ding Men, Dong Cheng District, Beijing, China
Signing accountants Lin Wanqiang, Zhang Liping
Sponsor engaged by the Company to conduct consistent supervision during the reporting period
√ Applicable □ Inapplicable
Name Office address Representative Consistent supervision period
43/F, Metropolitan Plaza,
183-187 Tianhe North Rd., In August 15, 2011 -2012 year
GF Securities Co., Ltd. He Xiaoshe, Yan Peng
Tianhe District, Guangzhou, in December 31st
Guangdong Province, China
Financial consultant engaged by the Company to conduct consistent supervision during the reporting period
□ Applicable √ Inapplicable
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2012 Annual Report of Anhui Gujing Distillery Company Limited
SectionIII.Accounting&FinancialHighlights
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of the accounting policy or
correction of any accounting error?
□ Yes √ No
Increase or decrease of
2012 2011 this year over last year 2010
(%)
Operating revenues (RMB Yuan) 4,197,057,315.26 3,307,979,236.00 26.88% 1,879,155,480.31
Net profit attributable to
shareholders of the Company 725,589,286.31 566,390,286.36 28.11% 313,757,556.93
(RMB Yuan)
Net profit attributable to
shareholders of the Company after
711,934,788.75 553,567,092.68 28.61% 286,885,074.85
extraordinary gains and losses
(RMB Yuan)
Net cash flows from operating
1,086,867,364.46 625,901,467.35 73.65% 517,700,354.38
activities (RMB Yuan)
Basic EPS (RMB Yuan/share) 1.44 1.17 23.08% 0.66
Diluted EPS (RMB Yuan/share) 1.44 1.17 23.08% 0.66
ROE (%) 23.8% 31.65% -7.85% 34.17%
Increase or decrease of
As at 31 Dec. 2012 As at 31 Dec. 2011 this year-end than last As at 31 Dec. 2010
year-end (%)
Total assets (RMB Yuan) 5,308,127,471.04 4,241,819,550.30 25.14% 1,857,931,814.00
Net assets/owners’ equity
attributable to shareholders of the 3,375,488,108.64 2,761,115,284.45 22.25% 1,049,475,547.82
Company (RMB Yuan)
II. Differences between accounting data under domestic and overseas accounting standards
1. Differences of net profit and net assets disclosed in financial reports prepared under international and Chinese accounting
standards
There is no difference.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese accounting
standards
There is no difference.
3. Explain reasons for the differences between accounting data under domestic and overseas accounting standards
III. Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Items 2012 2011 2010 Notes
Gain/loss on the disposal of non-current
assets (including the offset part of the asset 465,158.50 186,246.05 4,370,129.60
impairment provisions)
Tax rebates, reductions or exemptions due to
approval beyond authority or the lack of 0.00 0.00 0.00
official approval documents
Government grants recognized in the current
period, except for those acquired in the
ordinary course of business or granted at 5,871,645.90 4,111,902.86 2,161,537.17
certain quotas or amounts according to the
government’s unified standards
Capital occupation charges on non-financial
enterprises that are recorded into current 0.00 0.00
gains and losses
Gains due to that the investment costs for
the Company to obtain subsidiaries,
associates and joint ventures are lower than
0.00 0.00
the enjoyable fair value of the identifiable
net assets of the investees when making the
investments
Gain/loss on non-monetary asset swap 0.00 0.00
Gain/loss on entrusting others with
0.00 0.00
investments or asset management
Asset impairment provisions due to acts of
0.00 0.00
God such as natural disasters
Gain/loss on debt restructuring 0.00 0.00
Expenses on business reorganization, such
as expenses on staff arrangements, 0.00 0.00
integration, etc.
Gain/loss on the part over the fair value due 0.00 0.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
to transactions with distinctly unfair prices
Current gains and losses of subsidies
acquired from business combination under
0.00 0.00 24,890.84
the same control as from period-begin to
combination date
Gain/loss on contingent events irrelevant to
0.00 0.00
the Company’s normal business
Gains and losses on change in fair value
from tradable financial assets and tradable
financial liabilities, as well as investment
income from disposal of tradable financial
0.00 0.00 982,590.50
assets and tradable financial liabilities and
financial assets available for sales except for
effective hedging related with normal
businesses of the Company
Impairment provision reversal of accounts
receivable on which the impairment test is 0.00 4,106,508.26 17,885,989.72
carried out separately
Gain/loss on entrustment loans 0.00 0.00
Gain/loss on change of the fair value of
investing real estate of which the subsequent
0.00 0.00
measurement is carried out adopting the fair
value method
Effect on current gains/losses when a
one-off adjustment is made to current
gains/losses according to requirements of 0.00 0.00
taxation, accounting and other relevant laws
and regulations
Custody fee income when entrusted with
0.00 0.00
operation
Non-operating income and expense other
12,188,577.39 9,993,800.13 3,973,823.73
than the above
Other gain and loss items that meet the
0.00 0.00
definition of an extraordinary gain/loss
Income tax effects 4,870,884.23 5,575,263.62 2,526,479.48
Minority interests effects (after tax) 0.00 0.00
Total 13,654,497.56 12,823,193.68 26,872,482.08 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
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2012 Annual Report of Anhui Gujing Distillery Company Limited
□ Applicable √ Inapplicable
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2012 Annual Report of Anhui Gujing Distillery Company Limited
SectionIV.ReportoftheBoardofDirectors
I. Overview
In 2012, is the company's leap-forward development a key in the reporting period the company closely around business objectives, In
the reporting period, doggedly pursuing the operating objectives and in strict compliance with the powers bestowed by the Company
Law, the Securities Law and its Articles of Association, the Company strictly executed all resolutions of the Shareholders’ General
Meeting, firmly carried out the leap-frog development strategy and put in constant efforts on key tasks. Through carrying out lean
management in depth, adjusting the organizational structure, sturdily improving the internal control mechanism, constantly updating
the management mode and rationally allocating various resources, the Company overcame various unfavorable external factors,
steadily improved operation & management and comprehensive competitiveness and achieved all the operating budget targets set at
the beginning of the year.
II. Main business analysis
1. Overview
For 2012, the Company achieved operating revenues of RMB 4,197,057,300 yuan, up 26.88% over last year, total profit of RMB
972,427,100, up 14.39% over last year; net profit of RMB 725,589,300, up 28.11% over last year; EPS of RMB 1.44/share, up
23.08%; operating net cash flows of RMB 1,086,867,400, up 73.65% over last year. The production and operation of the Company
continued to improve.
General operation of the Company in the reporting period
1. Continuously improved branding and optimized marketing structure to promote sales growth of the Company.
In the reporting period, the Company improved its brand influence by participating in several large-scale activities, such as Touching
the Heart of China, Korea Yeosu World Expo, and ancestor worship with the crew of Hero of Caocao. Through foundation work in
market, optimization of distributor and product structure, and in-depth promotion of Three Direct Links, it could allocate all kinds of
resources rationally, overcome outside adverse factors and promote sales growth for the Company.
2. Product quality rose steadily through lean management and scientific and technological achievements.
In 2012, lean production and technical quality had achieved a great of breakthroughs. The second stage of lean management for the
Company was completed successfully. Three QC tasks and three teams were honored as provincial excellent ones. One lean
management project won the first prize of provincial management innovation product. Moreover, by combining practice, the
Company reinforced the project construction. In the reporting period, four scientific research projects won the provincial scientific
and technological achievements. The project of “influence study of bran water to taste of wine” helped to improve raw wine quality
and guaranteed the steady quality enhancement.
3. Took the opportunity of application for “Anhui Government Quality Reward” to promote the excellent performance management
model and the overall management level of the company.
The Company has introduced excellent performance management model and taken the opportunity of application for “Anhui
Government Quality Reward”. According to standard requirements of Excellent Performance Evaluation Criteria, it has summarized
the development history and management experience to make a full examination for the Company. By deep analysis in advantages
and disadvantages, specialties and highlights, problems have been solved and rectified, helpful to improve the core competitiveness
for the Company and enhance awareness and understanding of excellent performance management to all staff. It would be
meaningful for the Company to establish a sound and long-term excellent management mechanism and advance the total
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2012 Annual Report of Anhui Gujing Distillery Company Limited
management levels.
4. Reinforced internal controls and optimized management system to continuously improve governance in the Company.
In the reporting period, the Company had formulated and implemented the Work Program of Internal Control Practices. By the
principle of careful planning and implement by step, the Company had developed the promotion of internal controls. Through
summarizing current regulations and rules and formulating pointed rectification and reform programs, it had clarified the settings and
responsibilities for each organization. The operation system could be optimized. At present, the Company has formulated Internal
Control Management Manual to make full risk management for internal environment, organizational structure, development
strategies, human resources, social responsibility, product quality and corporate culture to enhance risk prevention for the Company.
5. Corporate cultural construction and position evaluation provided protection for the great-leap-forward development.
Corporate culture is the soul and foundation for a company. In the reporting period, the Company held large music and dance epic
evening party of “Exceeding 5 billion”, commemorative activity of the first tribute wine by Cao Cao since 1816 and inauguration for
the industrial park and other large-scale activities to represent new look of the Company and enhance confidence for all staff. The
position evaluation, perfect reward and punishment mechanism, position-valued salary administration would all improve the sense of
belonging for all staff and provide power guarantee for its development.
State the reasons why the Company’s actual business performance is 20% lower or higher than the earning forecast for the reporting
period which has been publicly disclosed earlier:
□ Applicable √ Inapplicable
2. Revenues
Explanation:
N/A
Is the Company’s goods selling revenue higher than the service revenue?
√ Yes □ No
Industry Items 2012 (ton) 2011 (ton) YoY +/-（%）
Sales volume 54,529.63 37,120.33 46.90%
Liquor making Output 52,770.09 43,250.63 22.01%
Stock 2,033.16 3,792.70 -46.39%
Reasons for any over-30% YoY movement of the data above:
√ Applicable □ Inapplicable
The sales volume up to 31 Dec. 2012 increased 46.90% over last year and the stock increased46.39%, which was mainly because
production and sales were both strong and the Company stocked up for the Spring Festival.
Major orders held:
□ Applicable √ Inapplicable
Significant change or adjustment of the Company’s products or services during the reporting period:
□ Applicable √ Inapplicable
Major customers:
Total sales to the top 5 customers (RMB Yuan) 852,756,890.47
Ratio of the total sales to the top 5 customers to the 20.32%
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2012 Annual Report of Anhui Gujing Distillery Company Limited
annual total sales (%)
Information about the top 5 customers:
√ Applicable □ Inapplicable
Serial No. Name of customer Sales (RMB Yuan) Proportion in annual total sales (%)
1 Distributor A 273,725,490.08 6.32%
2 Distributor B 228,037,813.66 5.26%
3 Distributor C 161,291,594.65 3.72%
4 Distributor D 99,191,699.56 2.29%
5 Distributor E 90,510,292.52 2.09%
Total —— 852,756,890.47 20.32%
3. Costs
Classified by industry:
Unit: RMB Yuan
2012 2011
Proportion in Proportion in
Industry Item YoY +/- (%)
Amount operating costs Amount operating costs
（%） （%）
Food making Raw materials 1,138,829,249.65 95.4% 765,457,373.60 91.89% 48.78%
Classified by product:
Unit: RMB Yuan
2012 2011
Proportion in Proportion in
Product Item YoY +/- (%)
Amount operating costs Amount operating costs
（%） （%）
Distilled spirit raw material 846,150,132.49 74.3% 582,283,424.10 76.07% 45.32%
Distilled spirit Their wages 846,150,132.49 10.52% 68,355,343.46 8.93% 75.27%
Distilled spirit energy 846,150,132.49 7.68% 60,322,861.04 7.88% 44.92%
manufacturin
Distilled spirit 846,150,132.49 7.5% 54,495,745.00 7.12% 56.81%
g expense
Explanation:
N/A
Major suppliers:
Total purchases from the top 5 suppliers （RMB Yuan） 331,604,957.26
Ratio of the total purchases from the top 5 suppliers to the 36.06%
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2012 Annual Report of Anhui Gujing Distillery Company Limited
annual total purchases（%）
Information about the top 5 suppliers:
√ Applicable □ Inapplicable
Procurement amount (RMB Proportion in annual total procurement
Serial No. Name of supplier
Yuan) amount (%)
1 Supplier A 136,688,547.01 14.87%
2 Supplier B 66,204,786.32 7.2%
3 Supplier C 46,453,504.27 5.05%
4 Supplier D 42,416,239.32 4.61%
5 Supplier E 39,841,880.34 4.33%
Total —— 331,604,957.26 36.06%
4. Expense
1. Sales expenses stood at RMB1,075,977,234.87, up 34.28% over last year, which was mainly because the Company enhanced sales
promotion and the expense on services, sales promotion and advertising increased.
2. Financial expenses stood at RMB -88,430,981.17, down 70.48%, which was mainly because the bill handling fees received, as
well as the interest income from term deposits and structural deposits, increased.
5. R&D expenses
The R&D expenses in the reporting period stood at RMB 174,362,000, accounting for 5.17% of the net assets and 4.15% of the
operating revenues.
6. Cash flows
Unit: RMB Yuan
Item 2012 2011 YoY +/-（%）
Subtotal of cash inflows from
5,409,722,258.53 3,682,028,848.98 46.92%
operating activities
Subtotal of cash outflows from
4,322,854,894.07 3,056,127,381.63 41.45%
operating activities
Net cash flows from operating
1,086,867,364.46 625,901,467.35 73.65%
activities
Subtotal of cash inflows from
308,940.95 9,087,318.61 -96.6%
investing activities
Subtotal of cash outflows from
646,248,607.55 344,656,892.95 87.5%
investing activities
Net cash flows from investing
-645,939,666.60 -335,569,574.34 92.49%
activities
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Subtotal of cash inflows from
1,231,500,000.00 -100%
financing activities
Subtotal of cash outflows from
113,310,000.00 83,030,122.54 36.47%
financing activities
Net cash flows from financing
-113,310,000.00 1,148,469,877.46 -109.87%
activities
Net increase in cash and cash
327,617,860.76 1,438,801,086.91 -77.23%
equivalents
Reasons for any over-30% YoY movement of the data above:
√ Applicable □ Inapplicable
1. Net cash flows from operating activities stood at RMB 1,086,867,364.76, up 73.65% over last year, which was mainly because the
sales income increased.
2. Net cash flows from investing activities stood at RMB -645,939,666.90, up 92.49% over last year, which was mainly because the
Company paid more for fixed assets, equipment and engineering and it subscribed for the non-public shares issued by Shandong
Lipeng Co., Ltd..
3. Net cash flows from financing activities stood at RMB-113,310,000.00, down 109.87% over last year, which was mainly because
last year, the Company made a non-public offering to raise funds, setting a high comparative.
Reasons for a big difference between the operating cash flows and the net profit:
□ Applicable √ Inapplicable
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease Increase/decrease
Increase/decrease
Operating Gross profit rate of operating of gross profit
Operating costs of operating costs
revenues (%) revenues over last rate over last year
over last year (%)
year (%) (%)
Classified by industry:
Manufacture 4,148,697,033.94 1,193,727,937.33 71.23% 26.58% 43.3% -3.35%
Classified by product:
Distilled spirit 4,045,542,438.97 1,138,829,249.65 71.85% 27.27% 48.78% -4.07%
Hotel 71,252,072.61 39,515,901.20 44.54% -0.53% -13.97% 8.67%
Other 31,902,522.36 15,382,786.48 51.78% 17.21% -28.96% 31.34%
Classified by region:
Domestic 4,143,500,606.57 1,192,256,588.06 71.23% 26.54% 43.25% -3.36%
Overseas 5,196,427.37 1,471,349.27 71.69% 70.98% 101.02% -4.23%
Where the Company’s accounting standard of the main business data above changed during the reporting period, give the main
business data of the latest year adjusted according to the accounting standard at the end of the reporting period:
□ Applicable √ Inapplicable
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2012 Annual Report of Anhui Gujing Distillery Company Limited
IV. Asset and liability analysis
1. Major changes of asset items
Unit: RMB Yuan
As at 31 Dec. 2012 As at 31 Dec. 2011
Proportio
Proportion in Proportion in
n change Explain any major change
Amount total assets Amount total assets
（%）
(%) (%)
2,609,650,352. 2,082,032,491.
Monetary funds 49.16% 49.08% 0.08%
09 33
Accounts
7,887,007.25 0.15% 37,685,831.22 0.89% -0.74%
receivable
782,399,498.8
Inventories 14.74% 578,157,069.43 13.63% 1.11%
5
Investing real
31,451,269.49 0.59% 32,558,410.26 0.77% -0.18%
estate
783,740,205.1
Fixed assets 14.76% 362,778,190.84 8.55% 6.21%
5
Construction in 423,672,281.5
7.98% 133,017,100.51 3.14% 4.84%
process 4
2. Significant changes in liabilities
Naught
3. Assets and liabilities measured at fair value
Unit: RMB Yuan
Gain/loss from Accumulative Amount
Impairment Amount sold in Closing
Opening change in fair change in fair
Item provision for purchased in
balance value in this value recorded this period balance
this period
year into equity this period
Financial assets
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2012 Annual Report of Anhui Gujing Distillery Company Limited
3. Financial
assets available 0.00 0.00 2,791,383.84 0.00 27,991,376.84
for sale
Subtotal of
0.00 0.00 2,791,383.84 0.00 27,991,376.84
financial assets
Total of the
above 0.00 0.00 2,791,383.84 0.00 27,991,376.84
mentioned
Financial
0.00 0.00 0.00 0.00 0.00
liabilities
Whether the measurement attributes of the main assets of the Company had significant changes during the reporting period or not?
□ Yes √ No
V. Analysis to the core competitiveness
After one thousand years pass on, adhering to the traditional brewing wine, after several generations of hard working, flavoring
liquor has formed the unique core competitiveness, mainly displays in:
A brand value, the liquor industry
Flavoring liquor is one of the "old" eight famous liquor in China, national gold medal four go-round, Paris is the only won gold
MEDALS in the 13th international food exposition of famous Chinese liquors, awarded China's well-known trademarks, of original
protection products of China, national geographical indication products such as honor, high market recognition.
Second, the unique brewing technology and good quality
Flavoring liquor traditional brewing craft after one thousand, has a wealth of historical, scientific and cultural value, is an important
branch of Chinese traditional distilling brewing techniques. Unique brewing process, given the flavoring wine quiet and tastefully
laid out and the connotation of the quality of excellence; Using traditional brewing technology production base, from raw material
selection, design, technology research and development, to the password taste quality and physical and chemical analysis,
professional evaluation and so on, each process shall be strictly controlled, the product has good quality and reputation for quality,
accept consumer favour for a long time.
Three, outstanding management innovation ability and the decision-making ability of rapid response to market changes
Company takes the lead in liquor-making industry and stick to the lean management mode, the lean concept into the various
functional departments, to customer demand as the center, breaking boundaries, full participation, pursuit of excellence, promote
standardization of winemaking, created a model of liquor-making industry, to form the excellence of management innovation ability;
Companies adhere to the "research, production, sales and service" four one of the overall train of thought, by importing the
performance excellence management model and 6 s management method optimize enterprise organization structure, shorten the
market research, product design, development, product manufacturing, product sales, and service cycle; Raw stock company in the
year of strategic leading products, reform the marketing agency, to set up the strategic market operation center, operation center and
provincial market will reach decisions, makes the decision-making ability of rapid response to market changes.
VI. Analysis to the investment situation
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2012 Annual Report of Anhui Gujing Distillery Company Limited
1. Particulars about external equity investment
（1）Particulars about external investment
Naught
（2）Particulars about holding equity of financial enterprises
Naught
（3）Particulars about securities investment
Number Sharehold Sharehold Gain/loss
Initial Number Closing
of shares ing ing for
Abbreviat investmen of shares book
Variety of Code of held at percentag percentag reporting Accounti Source of
ion of t cost held at value
securities securities period-be e at e at period ng title stock
securities (RMB period-en (RMB
gin period-be period-en (RMB
Yuan) d (share) Yuan)
(share) gin (%) d (%) Yuan)
Available
25,199,99 27,991,37 -for-sale Subscript
Stock 002374 LPGF 1,938,461 1.82% 1,938,461 1.82% 0
3.00 6.84 financial ion
assets
25,199,99 27,991,37
Total 1,938,461 -- 1,938,461 -- 0 -- --
3.00 6.84
Explanation on holding equity of other listed companies
2. Entrusted financial management, derivatives investment and entrustment loans
（1）Entrusted financial management
Naught
（2）Derivatives investment
Particulars about the derivatives investment held at the end of the reporting period
□ Applicable √ Inapplicable
Note
（3）Entrustment loans
Naught
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2012 Annual Report of Anhui Gujing Distillery Company Limited
3. Particulars about the use of raised funds
（1）Overview of the use of raised funds
Unit: RMB Ten Thousand
Total amount of raised funds 122,749.95
Total amount of raised funds input in the reporting
45,800.12
period
Total amount of raised funds accumulatively input 60,404.42
Explanation on overview of the use of raised funds
The Company’s raised funds were used stably as scheduled, without any changes.
（2）Projects promised to be invested with raised funds
Unit: RMB Ten Thousand
Date
Project Investme
Accumul when the Material
Projects invested with changed nt Profit
Raised Investme Input in ative project Reach the change in
raised capital as or not progress generated
capital nt after the input up reaches expected the
promised and (includin up to the in the
input as adjustme reporting to the the profit or project
investments with g period-en reporting
promised nt (1) year period-en expected not feasibility
over-raised capital partially d (%)(3) period
d (2) usable or not
changed) ＝(2)/(1)
condition
Projects invested with raised capital as promised
Technological
Transform on the 31 Dec.
Brewage of No 13,500 12,194.42 6,842.82 7,302.5 59.88% No
High-quality Base 2013
Wine
Construction of Base
Wine Blending & 31 Dec.
No 68,600 65,921.06 20,158.83 22,367.75 33.93% No
Filling Centre and 2013
Ancillary Facilities
Construction of 31 Dec.
No 27,500 27,500 7,171.68 13,806.28 50.2% No
Marketing Network 2013
Construction of Brand 31 Dec.
No 17,000 17,000 11,626.79 16,927.89 99.58% No
Promotion 2012
Subtotal of promised 122,615.4
-- 126,600 45,800.12 60,404.42 -- -- -- --
investment projects 8
Investments of over-raised capital
122,615.4
Total -- 126,600 45,800.12 60,404.42 -- -- 0 -- --
8
Reason for failing to In 2012, the high quality base liquor brewing technical renovation project schedule completed as planned,
20
2012 Annual Report of Anhui Gujing Distillery Company Limited
reach scheduled the main reason is that companies was scheduled in May 2012 to September during the wine-making
progress or projected workshop production during boiler facilities renovation project, due to the wine-making workshop during
income (explain one the production of pilot project in 2012, to the construction schedule of boiler renovation projects failed to;
project by one project) Company was originally scheduled for lab equipment renewal projects in 2012, due to lab site redesign
transformation, lead to project failure to carried out on schedule.
Hook 2012, base liquor storage and filling center failed to progress as planned and supporting facilities
construction projects completed, the main reason is that in order to guarantee the engineering quality, under
the premise of meet the needs of the production and business operation, give priority to the construction
base liquor storage and filling plant and ancillary facilities.
Explanation on
significant changes in Naught
feasibility of projects
Amount, usage and Inapplicable
usage progress of
Naught
over-raised capital
Change of the Inapplicable
implementation
location of any raised
Naught
funds investment
project
Inapplicable
Adjustment of the
implementation
method of any raised Naught
funds investment
project
Applicable
In accordance with the explanation of the Particulars on the Private Issuance of A-share of Anhui Gujing
Distillery Co., Ltd. and the Listing Announcement, “Before the raised proceeds being in place, the
Company can use the self-raised proceeds to input preliminarily in accordance with the actual progress of
raised proceeds investment projects; after the raised proceeds being in place, the Company can use the
raised proceeds to replace the self-raised proceeds preliminarily input”. And the Proposal on Using the
Raised Proceeds to Replace the Self-raised Proceeds Preliminarily Input to the Raised Proceeds Investment
Projects was reviewed and approved at the 7th Session of the 6th Board of Directors, which agreed to use
the raised proceeds to replace the self-raised proceeds of RMB27,058,143.42 preliminarily input to the
raised proceeds investment projects. The above funds replacement was completed on 6 Jan. 2012.
Advance input and Inapplicable
exchange of any raised
funds investment Naught
project
Outstanding raised Inapplicable
21
2012 Annual Report of Anhui Gujing Distillery Company Limited
funds in project
implementation and Naught
reasons
Usage and whereabouts
Deposited in the special account for raised proceeds
of unused raise capital
Problems found in the
usage and disclosure
Naught
affairs of raised capital
and other situations
（3）Change of projects invested with raised funds
Naught
4. Analysis to main subsidiaries and stock-participating companies
Main subsidiaries and stock-participating companies
Registered
Main Operating Operating
Company Company capital Total assets Net assets Net profit
Industry products/ser revenues profit
name variety (RMB (Yuan) (Yuan) (Yuan)
vices (Yuan) (Yuan)
0’000)
Wholesales 8,486.00 1,091,916,6 206,408,49 4,036,240,0 732,581,7 554,171,976.
of distilled 27.19 3.29 71.78 75.69 79
Bozhou spirit,
Gujing Business constructio
Subsidiary
Sales Co., trading n materials,
Ltd feeds and
assistant
materials
Bozhou Transportati 695.00 3,587,200.6 2,475,117.0 0.00 0.00 0.00
Gujing Transportati on, sales 0 2
Subsidiary
Transportati on and repair
on Co., Ltd service
Bozhou Manufactur 8,666.03 165,078,03 120,039,70 174,470,52 20,070,30 15,756,937.6
Gujing Manufactur e and sale 7.28 9.91 3.83 4.54 3
Subsidiary
Glass Co., e of glass
Ltd products
Bozhou Collect and 100.00 1,653,929.3 1,315,524.2 5,772,888.6 91,756.32 71,519.31
Gujing sale of 0 6 4
Waste
Waste Subsidiary recycled
recycle
Reclamatio glass bottle,
n Co., Ltd glass,
22
2012 Annual Report of Anhui Gujing Distillery Company Limited
wastebasket
Production, 200.00 139,275,47 3,687,985.8 324,986,53 6,735,116 5,159,808.51
publish, 8.77 5 8.30 .13
design and
proxy of
Anhui ads in
Jinyunlai China;
Ads
Culture & Subsidiary ceremony
marketing
Media service for
Co.,Ltd. conferences
as well as
sales of
gifts in arts
and crafts
Administrat 3,000.00 45,894,557. 34,564,087. 24,370,829. 6,119,107 4,564,087.80
ive license 16 80 39 .18
items：
Naught;
General
operating
items:
providing
Bozhou Production
packing for
Gujing and
Subsidiary Gujing
Packing manufactur
Brand,
Co., Ltd. e
serials
wine, fruit
and
vegetable
wine, health
wine of
Gujing
Brand
Production, 500.00 37,890,707. 5,423,313.7 46,346,472. 1,109,731 837,512.46
publish, 49 1 18 .28
Shanghai design and
Hongbang proxy of
Culture Ads ads in
Subsidiary
Communica marketing China;
tion Co., ceremony
Ltd. service for
conferences
; public
23
2012 Annual Report of Anhui Gujing Distillery Company Limited
relations
activities
planning;
design &
planning of
company
image; sales
of gifts in
arts and
crafts
(except
special
items) (If
the
enterprise
operation
involves the
administrati
ve
licensing, it
shall
operate
based on
the license).
Hotel 5,400.00 250,805,15 83,389,984. 69,674,624. 5,232,501 4,392,153.33
managemen 6.53 01 96 .57
t (Except
for catering
managemen
t、Except
for hotel
Shanghai operation);
Gujing Self-owned
Hotel
Jinhao housing
Subsidiary managemen
Hotel rental;
t
Managemen establish
t Co., Ltd. branch. (If
the
enterprise
operation
involves the
administrati
ve
licensing, it
24
2012 Annual Report of Anhui Gujing Distillery Company Limited
shall
operate
based on
the license).
Accommod 62.80 1,045,443.4 12,937.60 3,890,467.0 -192,763. -198,406.85
ation and 1 0 68
parking
services；
Bozhou lunch
Hotel
Gujing processing,
Subsidiary managemen
Hotel Co., sales of
t
Ltd. alcohol and
tobacco and
sales of
daily
commodity
Explanation on main subsidiaries and stock-participating companies
Particulars about subsidiaries gained and disposed during the reporting period
□ Applicable √ Inapplicable
5. Particulars about significant projects invested by non-raised funds
Unit: RMB Ten Thousand
Accumulative
Total amount of amount actually
Amount input in the
Name of project investment (RMB input as of the Progress of project Gains from project
year (RMB Yuan)
Yuan) period-end (RMB
Yuan)
Relocation and 55,000.00 26,807.95 35,253.54 64.1%
Technological
Transform on the
Brewage of Base
Wine and the
supporting facilities
projects
Technological 994.00 924.21 926.70 100.00%
transform project
workshop I
Deep-processing 2,020.00 1,940.66 1,941.66 100.00%
complex building
Total 58,014.00 29,672.82 38,121.90 -- --
Explanation on significant projects invested by non-raised funds
VII. Particulars about special purpose entities controlled by the Company
25
2012 Annual Report of Anhui Gujing Distillery Company Limited
Naught
VIII. Outlook of the Company’s future development
Outlook of the Company’s future development and operation plan for 2013
(Ⅰ). Industry development prospects of the Company
1. From macroscopic view: since 2012, global economy is changeable. High unemployment rate and slow growth of emerging
economies in America still exist. Reduced domestic demands, high costs, gliding corporate profits and excess production capacity are
prominent. Looking forward the year of 2013, there are still many uncertain factors. Domestic demand, especially consumption,
would be main engine for China economic growth. Macro-policy is stable, fiscal policy more positive, monetary policy more stable
and standard-reduction probability higher. China economy would enter new normalcy with intermediate speed. New reform for
economy development is demanded for a new dividend system.
2. From development tendency of the industry: three public consumption types have been limited with suffocation of group purchase
and top grade wine. The wine industry is facing crisis of food safety. Confidence from consumers needs to be re-established. Excess
production capacity, oversupply, and policy changes result in rational return of consumption parting from high growth for wine
industry. High-end market has been slowed down and middle end market develops fast with differentiation of structure. The
advantages of brand enterprises are more prominent. Merging and re-organization could not be avoided.
3. From future development of the Company: costs of raw materials are increasing. Pressure of inflationary would be larger. Internal
operation costs have been increased. Moreover, wine industry has entered extruding growth from market expansion. Market
competition would turn white-hot, which challenges the leading advantages for the Company.
(Ⅱ). Operating measures of the Company in 2013
1. Keep focus on, duplicate quickly, and promote marketing from resource-oriented to brand-oriented.
The Company would continue enhancing market foundation, insisting keeping focus on, cultivate intensively, deepen Three Direct
Links, and optimize structures of products, prices, customers and internal system. It is to promote work in all areas on key points,
duplicate the strategies quickly and put forward promotion of the brand of Gujing nationwide. Moreover, it will continue resources
optimization, allocation of organizations and talents to improve quality and profits for wine sales and marketing from
resource-oriented to brand-oriented.
2. In-depth promote fine management and transfer to fine corporation to improve quality control.
The Company would in-depth promote fine management centered on customers, drove by continuous improvement and
standardization. The strategies of 6S, talent education and TPM would be adopted for establishment of fine management evaluation
26
2012 Annual Report of Anhui Gujing Distillery Company Limited
system, and perfect quality management system. Standardized document management and strict obedience to procedures would both
be helpful enhancement of monitoring production procedures, product quality and control capabilities. It would continuously
strengthen technical software allocation, improve development levels and accelerate scientific and research execution and transfer to
fine corporation.
3. Accelerate application projects construction and scientific management to ensure completion.
The Company would strictly control the construction period and budget to accelerate application projects construction.
Organizational discipline for construction staff with work style of innovation, dedication and painstaking would be promoted.
Planning and coordination relationships of proprietors, construction units, supervision units, and other governing departments would
be adopted to guarantee the project construction. Complete flow scheme would ensure standardization, automation and ecological
cycle in implementation of the philosophy of “wine industry, wind culture, wine tourism, wine ecology” for a real resource-saving
and environment-friendly project, which would promote the brand influence and market competition for the Company.
4. Carry out activity of Cost-control Year to improve internal operation efficiency
The Company would develop cost control activities and resolve external market pressure to promote improvement of the internal
operation efficiency by all involved, overall procedures control through budget management, fine management, benchmark
management and internal control. In order to guarantee the effects of cost control activities, cost control department would motivate
all organizations to participate in production, operation and sales control for positioning and predicting of prices, costs and profits,
controlling sales costs, evaluating market expenses, optimizing capital management model and improving capital usage efficiency.
5. Carry out campaigns for better performance, team construction, participation in public welfare activities and delivery social
positive energy.
The Company would carefully summarize effects and experience in the campaigns with promotion of competent and moral talents.
By fully expressing the demonstration effect of advanced employees, it would consolidate and enlarge working effects to be
institutional, normal and long-term. The Company also would make breakthroughs by promoting the culture of contribution by
Gujing, participating in social public activities, enlarging communication, leading wine consumption, delivering social positive
energy and improving reputation for the Company.
The year of 2013 is a new start. The Company would continue insisting core values of “five solid principles” with all staff standing
together regardless of situation. The Company would develop a new sky for Gujing by solid steps and confidence.
27
2012 Annual Report of Anhui Gujing Distillery Company Limited
IX. Explanation of the Board of Directors on “Non-standard Auditor’s Report” issued by the CPA firm for the reporting
period
Naught
X． Explanation on change of accounting policy, accounting estimates and accounting methods as compared with the
financial report in last year
（1）Change of accounting policy
There was no change of accounting policy for the Company during the reporting period.
（2）Change of accounting estimates
Content, reason and applicable time of change in Name of affected items
Approval procedure Affected amount
accounting estimate of financial statements
In order to unite and refine the management and
accounting rules for fixed assets, as well as strictly Approved at the 8th Fixed assets,
th
control the occurrence of non-operating business, the Session of the 6 management expenses,
3,691,833.96
Company planed to change the depreciation life of Board of Directors sales expenses
fixed assets from 1 Jan. 2012. (please refer to note ① of the Company
for details）
Note ①：The category, expected useful life, annual depreciation rate and residual value rate of fixed assets before the change of
accounting estimate
Category of fixed assets Expected useful life (year) Annual depreciation rate (%) Residual value rate (%)
Houses and buildings 8-35 years 3-5 2.7-12.1
Machinery Equipments 8-10 years 3-5 9.5-12.1
Transportation Equipments 8 years 3 12.1
Office equipments and others 8 years 3 12.1
The category, expected useful life, annual depreciation rate and residual value rate of fixed assets after the change of accounting
estimate
Annual depreciation rate
Category of fixed assets Expected useful life (year) Residual value rate (%)
(%)
Houses and buildings 8-35 3-5 2.7-12.1
Machinery Equipments 8-10 3-5 9.5-12.1
Transportation Equipments 4 3 24.25
Office equipments and others 3 3 32.33
XI. Explanation on the retrospective restatement for correcting the significant accounting errors during the reporting period
Naught
28
2012 Annual Report of Anhui Gujing Distillery Company Limited
XII. Explanation on changes in the consolidated scope compared with the financial report in last year
Entities that newly and no longer combined into consolidation scope in the reporting period
（1）Entities that newly and no longer combined into consolidation scope in the reporting period
① The subsidiaries, special purpose entities and operating entities with control right formed by entrusted operation or lease that
newly included in the consolidated scope
Name Closing net assets Net profit in current period
Shanghai Hongbang Culture 5,423,313.71 837,512.46
Communication Co., Ltd.
Shanghai Hongbang Culture Communication Co., Ltd. was the subsidiary gained by establishment in the year.
② The subsidiaries, special purpose entities and operating entities with control right formed by entrusted operation or lease that no
longer included in the consolidated scope
Net profit from year-begin to
Name Net asset on the disposal date
disposal date
Hefei Gujing Trading Co., Ltd. 0.00 -789,080.51
Hefei Gujing Trading Co., Ltd. was cancelled in the year, which was no longer included in the consolidated scope.
XIII. Particulars about the profit distribution and dividend policy of the Company
Formulation, execution or adjustment of the Company’s profit distribution policy, especially the cash dividend policy, during the
reporting period:
The Company’s equity distribution plan in 2011 was reviewed and approved at the 2011 Annual Shareholders’ General Meeting,
with details as follows: Based on the total 251,800,000 shares of the Company as at the end of 2011, a cash dividend of RMB 4.50
(tax included) was distributed for every 10 shares of all the shareholders; meanwhile, 10 additional bonus shares were distributed for
every 10 shares by capital reserves for all the shareholders. The plan was fully carried out in Apr. 2012 without any adjustment.
The Company’s preplan on profit distribution and turning capital reserve into share capital were in line with relevant stipulations of
the Articles of Association.
The Company’s preplans on profit distribution and turning capital reserve into share capital for the recent three years (including the
reporting year):
1. During the reporting period, according to the requirements of Regulations on Reinforcing the Protection for the Interests of Public
Share Holders (Zheng-Jian-Fa [2004] No. 118), Decision on Revising the Provisions of Cash Dividends Distribution of Listed
Company (CSRC Order No. 57) and Notice on Further Implementing Matters Related to Cash Dividend Distribution of Listed
Companies issued by CSRC, the Company convened the 10th Session of the 6th Board of Directors to revise the Articles of
Association, newly adding the detailed conditions and proportion for cash dividends distribution and other profits distribution policy,
which was submitted to the First Special Shareholders’ General Meeting for 2012 and approved.
2. The Company’s preplans on profit distribution and turning capital reserve into share capital were in line with relevant stipulations
of the Articles of Association.
3. The Company’s preplans or plans on profit distribution and turning capital reserve into share capital for the recent three years
(including the reporting year) as follows:
The Company’s plan on cash distribution in 2010 was as follows: a cash of RMB 3.5 (tax included) was distributed for each 10
shares, with no public reserves turned into share capitals.
The Company’s plan on cash distribution in 2011 was as follows: a cash of RMB 4.5 (tax included) was distributed for each 10
shares, and 10 additional bonus shares were distributed for every 10 shares by capital reserves.
29
2012 Annual Report of Anhui Gujing Distillery Company Limited
The Company’s preplan on cash distribution in 2012 was as follows: a cash of RMB 5 (tax included) was distributed for each 10
shares, and no capital reserves were turned into share capitals.
Cash dividend distribution of the Company over the recent three years:
Unit: RMB Yuan
Net profit attributable to
Ratio in net profit attributable to
shareholders of listed
Amount of cash dividend shareholders of listed
Year companies under the
(tax included) companies under the
consolidated statement in the
consolidated statement (%)
year
2012 251,800,000.00 725,589,286.31 34.7%
2011 113,310,000.00 566,390,286.36 20.01%
2010 82,250,000.00 313,757,556.93 26.21%
The Company (including its subsidiaries) made profit in the reporting period and the retained profit of the Company (without
subsidiaries) was positive, but it did not put forward a preplan for cash dividend distribution:
□ Applicable √ Inapplicable
XIV. Social responsibilities
For particulars about the social responsibilities performed by the Company during the reporting period, please refer to the Report on
Social Responsibilities disclosed on http://www.cninfo.com.cn dated 23 Apr. 2013.
XV. Particulars about researches, visits and interviews received in this reporting period
The reporting period the company did not happen in the field investigation, communication and interview etc.
30
2012 Annual Report of Anhui Gujing Distillery Company Limited
V.SignificantEvents
I. Significant lawsuit or arbitration
□ Applicable √ Inapplicable
There was no significant lawsuit or arbitration during the reporting period.
Media’s queries
√ Applicable □ Inapplicable
Explanation on media’s queries Disclosure date Disclosure index
A press article titled “Gu Jing: Alcohol For details, please refer to the clarification
Procurement Reaches RMB 46 Million. announcement No. 2012-024 disclosed by
27 Aug. 2012
For Blending?” was published against the the Company on
Company. http://www.cninfo.com.cn.
II. Occupation of the Company’s capital by the controlling shareholder and its related parties for non-operating purposes
Naught
III. Bankruptcy and reorganization
Naught
IV. Asset transactions
1. Asset acquisition
Naught
2. Sale of assets
Naught
3. Business combination
Naught
V. Implementation and influence of equity incentive plan of the Company
Naught
31
2012 Annual Report of Anhui Gujing Distillery Company Limited
VI. Significant related-party transactions
1. Related-party transactions concerning routine operation
Pricing Settlemen
Type of Contents
principle Transacti Proportio t method
the of the
Related of the on n in same of the
Relations related-pa related-pa Transacti Market Date of Index of
transactio related-pa amount kind of related-pa
hip rty rty on price price disclosure disclosure
n party rty (RMB transactio rty
transactio transactio
transactio 0,000) ns (%) transactio
n n
n n
The
announce
ment on
Affiliated
routine
enterprise
related-pa
of Routine
Anhui rty
controllin related-pa
Ruifuxian Market 29 Feb. transactio
g rty Materials 4,686.91 49.31%
g Food price 2012 ns for
sharehold transactio
Co., Ltd. 2012 (No.
er and n
2012-005
actual
) on
controller
http://ww
w.cninfo.
com.cn
Total -- -- 4,686.91 -- -- -- -- --
2. Related-party transactions arising from asset acquisition or sale
Naught
3. Significant related-party transactions concerning joint investment in external parties
Naught
4. Credits and liabilities with related parties
Was there any non-operating credit or liability with related parties?
□ Yes √ No
5. Other significant related-party transactions
Naught
32
2012 Annual Report of Anhui Gujing Distillery Company Limited
VII. Particulars about significant contracts and their fulfillment
1. Particulars about trusteeship, contract and lease
(1) Trusteeship
Explanation on the trusteeship
Naught
The trusteeship whose profits reaching more than 10% of the total profits of the Company in the reporting period
□ Applicable √ Inapplicable
(2) Contract
Explanation on the contract
Naught
The contract whose profits reaching more than 10% of the total profits of the Company in the reporting period
□ Applicable √ Inapplicable
(3) Lease
Explanation on the lease
Naught
The lease whose profits reaching more than 10% of the total profits of the Company in the reporting period
□ Applicable √ Inapplicable
2. Guaranty
Naught
VIII. Performance of commitments
1. Commitments made by the Company or shareholders holding over 5% of the Company’s shares in the reporting period, or
such commitments carried down into the reporting period
Naught
IX. Particulars about engagement and disengagement of CPAs firm
CPAs firm engaged at present
Name of domestic CPAs firm RSM China Certified Public Accountants LLP
Remuneration for domestic CPAs firm (RMB 0’000) 105
Consecutive years of the audit services provided by
1
domestic CPAs firm
Names of the certified public accountants from the
Lin Wanqiang, Zhang Liping
CPAs firm
Reengage the CPAs firm at current period or not?
√ Yes □ No
Change the CPAs firm during the audit period or not?
33
2012 Annual Report of Anhui Gujing Distillery Company Limited
□ Yes √ No
Execute the approval procedure to change the CPAs firm or not?
√ Yes □ No
Explain in detail the change of the CPAs firm:
The former financial and internal control auditor Reanda Certified Public Accountants Co., Ltd. was merged by RSM China Certified
Public Accountants LLP. In order to ensure the consistency of the financial and internal control audit and upon review and approval
of the 1st Special Shareholders’ General Meeting for 2013, the Company hired RSM China Certified Public Accountants LLP as its
new financial and internal control auditor. For details, see the announcement No. 2012-028 on the 14th Session of the 6th Board of
Directors disclosed on http://www.cninfo.com.cn dated 10 Nov. 2012.
CPAs firm for the internal control audit:
√ Applicable □ Inapplicable
The former financial and internal control auditor Reanda Certified Public Accountants Co., Ltd. was merged by RSM China Certified
Public Accountants LLP. In order to ensure the consistency of the financial and internal control audit and upon review and approval
of the 1st Special Shareholders’ General Meeting for 2013, the Company hired RSM China Certified Public Accountants LLP as its
new financial and internal control auditor. For details, see the announcement No. 2012-028 on the 14th Session of the 6th Board of
Directors disclosed on http://www.cninfo.com.cn dated 10 Nov. 2012.
X. Explanation by the Supervisory Committee and independent directors (if applicable) about the “non-standard audit
report” issued by the CPAs firm for the reporting period
Naught
XI. Punishment and rectification
Naught
XII. Share trading suspension and delisting after the disclosure of this annual report
Naught
XIII. Other significant events
Naught
XIV. Significant events of subsidiaries of the Company
Naught
XV. Corporate bonds issued by the Company
Naught
34
2012 Annual Report of Anhui Gujing Distillery Company Limited
SectionVI.ChangesinShareCapitalandParticularsaboutShareholders
I. Changes in share capital
Before the change Increase/decrease (+, -) After the change
Capitalizat
Issuance ion of
Proportion Bonus Proportio
Amount of new public Others Subtotal Amount
(%) shares n (%)
shares reserve
fund
I. Shares subject to trading 16,800,00 16,800,00 -33,599,10 -16,799,10
6.67% 900 0%
moratorium 0 0 0 0
16,800,00 16,800,00 -33,600,00 -16,800,00
3. Other domestic shares 6.67%
0 0 0 0
Including: Shares held by 16,800,00 16,800,00 -33,600,00 -16,800,00
6.67%
domestic legal persons 0 0 0 0
5. Shares held by senior
900 900 900 0%
management staff
II. Shares not subject to 235,000,0 235,000,0 33,599,10 268,599,1 503,599,1
93.33% 100%
trading moratorium 00 00 0 00 00
1. Ordinary shares 175,000,0 175,000,0 33,599,10 268,599,1 383,599,1
69.5% 76.17%
denominated in RMB 00 00 0 00 00
2. Domestically listed 60,000,00 60,000,00 120,000,0
23.83% 23.83%
foreign shares 0 0 00
251,800,0 251,800,0 251,800,0 503,600,0
III. Total shares 100% 100%
00 00 00 00
Reason for the changes in share capital:
1. In Apr. 2012, the Company carried out the equity distribution plan of 10 bonus shares for 10 shares on all shareholders with the
capital reserve and the total shares of the Company thus increased to 503,600,000 shares.
2. In Aug. 2012, the Company disclosed on http://www.cninfo.com.cn the “Suggestive Announcement on Lifting Share Trading
Moratorium by the Board of Directors of Anhui Gujing Distillery Co., Ltd.” (No. 2012-021). The unlocked shares of 33,600,000
were from the non-public offering in 2011, accounting for 6.67% of the Company’s total shares.
Approval for changes in share capital
□ Applicable √ Inapplicable
Transfer for changes in share capital
The 2011 annual equity distribution plan and the listing of share trading moratorium completed in the reporting period, with all the
involved shares having been transferred.
35
2012 Annual Report of Anhui Gujing Distillery Company Limited
Effects of changes in share capital on the basic EPS, diluted EPS, net assets per share attributable to common shareholders of the
Company and other financial indexes over the last year and last period
□ Applicable √ Inapplicable
Other contents that the Company considers necessary or required by the securities regulatory authorities to disclose
II. Issuance and listing of securities
1. Securities issued in the previous three years
Name of security
Issuing price Number of Number approved Ending date of
and its derivative Issuing date Listing date
(RMB Yuan) issuance (share) for listing (share) trade
security
Stock
RMB ordinary
15 Jul. 2011 75 16,800,000 3 Aug. 2011 16,800,000
shares
Convertible company bonds, bonds with attached warrant, company bonds, etc.
Warrant
Explanation on securities issuance over the past three years:
The non-public stock offering plan for 2011 was reviewed and approved at the 26th Session of the 5th Board of Directors held on 26
Nov. 2010 and later at the 1st Special Shareholders’ General Meeting for 2011 held on 14 Jan. 2011. The offering application
documents were accepted by CSRC on 29 Jan. 2011, reviewed and approved by the Public Offering Review Committee of CSRC on
20 May 2011 and then approved by CSRC (ZJXK [2011] No. 943) on 15 Jun. 2011. The Company accomplished the issuance-related
work of the private offering project on 15 Jul. 2011. The Company issued a total of 16.80 million shares of RMB ordinary shares
(A-shares) to 6 specific investors, raising RMB 1.26 billion in total. Reanda Certified Public Accountants verified the raised capital
upon its arrival and issued the Capital Verification Report Reanda-Yan-Zi [2011] No. 1065.
2. Change of the total shares, the shareholder structure, the asset structure and the liability structure
Naught
3. Existing shares held by employees
Naught
III. Shareholders and actual controller
1. Total number of shareholders and their shareholding
Unit: share
Total number of shareholders at the Total number of shareholders on the fifth trading day
32,085 34,406
reporting period before the disclosure date of the annual report
Particulars about shares held by shareholders with a shareholding percentage over 5%
36
2012 Annual Report of Anhui Gujing Distillery Company Limited
Total Increase Number Pledged or frozen shares
Number
shares /decreas of
of
Name of Nature of Shareholding held at e during non-trad
tradable
shareholder shareholder percentage (%) the the able Status of shares Number of shares
shares
period-e reportin shares
held
nd g period held
ANHUI GUJING
GROUP State-owned 271,404 135,702 271,404
53.89% The pledge 114,000,000
COMPANY Corporation ,022 ,011 ,022
LIMITED
PUNING
XINHONG Domestic
15,000, 7,500,0 15,000,
INDUSTRIAL non-state-owned 2.98% The pledge 15,000,000
000 00 000
INVESTMENT Corporation
CO., LTD.
KGI ASIA Foreign 10,290, 5,100,2 10,290,
2.04%
LIMITED corporation 679 56 679
TRIVEST
Foreign 7,644,1 4,369,0 7,644,1
CHINA FOCUS 1.52%
corporation 48 05 48
MASTER FUND
UBS
Foreign 7,357,5 3,670,6 7,357,5
(LUXEMBOUR 1.46%
corporation 95 78 95
G) S.A.
CHINA
CONSTRUCTIO
N BANK－
BANK OF
COMMUNICATI
State-owned 6,330,3 6,330,3
ONS 1.26%
Corporation 88 88
SCHRODERS
SUSTAINING
ALLOCATION
MIXED TYPE
FUND
CHINA
MERCHANTS Foreign 5,706,0 5,706,0
1.13%
SECURITIES corporation 02 02
(HK) CO., LTD
CHINA
CONSTRUCTIO State-owned 4,965,9 4,965,9
0.99%
N BANK－ Corporation 47 47
FIRST STATE
37
2012 Annual Report of Anhui Gujing Distillery Company Limited
CINDA
LEADING
GROWTH
STOCK FUND
GOLDEN
Foreign 4,778,2 4,778,2
CHINA 0.95%
corporation 34 34
MASTER FUND
INDUSTRIAL
AND
COMMERCIAL
BANK OF
State-owned 4,658,6 4,658,6
CHINA-GALAX 0.93%
Corporation 29 29
Y YINTAI
FINANCING
DIVIDEND
FUND
Strategic investor or general
corporation becoming a top ten
Inapplicable
shareholder due to placing of new
shares (if any)
Among the shareholders above, no affiliated relationship exists between the Company’s
controlling shareholder—Anhui Gujing Group Company Limited—and other shareholders,
Explanation on associated
nor they are parties acting in concert as defined in the Administrative Measures on
relationship or persons acting in
Information Disclosure of Changes in Shareholding of Listed Companies. As for other
concert among the above-mentioned
shareholders, the Company does not know whether they are related parties or whether they
shareholders:
belong to parties acting in concert as defined in the Administrative Measures on Information
Disclosure of Changes in Shareholding of Listed Companies.
Particulars about shares held by the top ten shareholders holding shares not subject to trading moratorium
Type of shares
Name of shareholder Number of tradable shares held at the year-end (Note 4)
Type Number
ANHUI GUJING GROUP Renminbi
271,404,022 271,404,022
COMPANY LIMITED ordinary shares
PUNING XINHONG
Renminbi
INDUSTRIAL INVESTMENT CO., 15,000,000 15,000,000
ordinary shares
LTD.
Domestically
KGI ASIA LIMITED 10,290,679 listed foreign 10,290,679
shares
Domestically
TRIVEST CHINA FOCUS
7,644,148 listed foreign 7,644,148
MASTER FUND
shares
38
2012 Annual Report of Anhui Gujing Distillery Company Limited
Domestically
UBS (LUXEMBOURG) S.A. 7,357,595 listed foreign 7,357,595
shares
CHINA CONSTRUCTION BANK
－BANK OF COMMUNICATIONS
Renminbi
SCHRODERS SUSTAINING 6,330,388 6,330,388
ordinary shares
ALLOCATION MIXED TYPE
FUND
Domestically
CHINA MERCHANTS
5,706,002 listed foreign 5,706,002
SECURITIES (HK) CO., LTD
shares
CHINA CONSTRUCTION BANK
－FIRST STATE CINDA Renminbi
4,965,947 4,965,947
LEADING GROWTH STOCK ordinary shares
FUND
Domestically
GOLDEN CHINA MASTER FUND 4,778,234 listed foreign 4,778,234
shares
INDUSTRIAL AND
COMMERCIAL BANK OF Renminbi
4,658,629 4,658,629
CHINA-GALAXY YINTAI ordinary shares
FINANCING DIVIDEND FUND
Among the shareholders above, no affiliated relationship exists between the Company’s
Explanation on associated
controlling shareholder—Anhui Gujing Group Company Limited—and other shareholders,
relationship or/and persons acting in
nor they are parties acting in concert as defined in the Administrative Measures on
concert among the top ten tradable
Information Disclosure of Changes in Shareholding of Listed Companies. As for other
shareholders and between the top ten
shareholders, the Company does not know whether they are related parties or whether they
tradable shareholders and the top ten
belong to parties acting in concert as defined in the Administrative Measures on Information
shareholders
Disclosure of Changes in Shareholding of Listed Companies.
Explanation on shareholders
participating in the margin trading Naught
business (if any)
2. Particulars about the controlling shareholder
Corporation
Legal
Date of
Name of controlling representative
establishm Organization code Registered capital Business scope
shareholder / company
ent
principal
ANHUI GUJING GROUP Yu Lin 16 Jan. 151947437 353,380,000.00 Making beverage,
39
2012 Annual Report of Anhui Gujing Distillery Company Limited
COMPANY LIMITED 1995 construction materials
and plastic products
Operating results, financial
situation, cash flow and
Inapplicable
future development strategy,
etc.
Shares held by the
controlling shareholder in
other listed companies by Inapplicable
holding or shareholding
during the reporting period
Change of the controlling shareholder during the reporting period
□ Applicable √ Inapplicable
3. Particulars about the actual controller
Corporation
Legal
Date of
representative
Name of the actual controller establishm Organizational code Registered capital Main business scope
/ person in
ent
charge
The People’s Government of
Bozhou
Operating results, financial
situation, cash flow and
Inapplicable
future development strategy,
etc.
Shares held by the
controlling shareholder in
other listed companies by Inapplicable
holding or shareholding
during the reporting period
Change of the actual controller during the reporting period
□ Applicable √ Inapplicable
The ownership and controlling relationship between the actual controller of the Company and the Company is detailed as follows:
The People’s Government of Bozhou
60％
40
Anhui Gujing Group Company Limited
53.89％
2012 Annual Report of Anhui Gujing Distillery Company Limited
The actual controller controls the Company via trust or other ways of asset management
□ Applicable √ Inapplicable
4. Other corporate shareholders with a shareholding ratio over 10%
Naught
IV. Particulars on shareholding increase scheme during the reporting period proposed or implemented by the shareholders
and act-in-concert persons
Naught
41
2012 Annual Report of Anhui Gujing Distillery Company Limited
Section VII. Particulars about Directors, Supervisors, Senior Executives and Employees of the Company
I. Changes in shareholding of directors, supervisors and senior executives
Shares at Increase of Decrease
Shares at
Beginning Ending the shares of shares
Incumbent the end of
Name Title Gender Age date of date of beginning during this during this
or not this year
office term office term of the year period period
(share)
(share) (share) (share)
Chairman
of the 15 April 16 April
YU LIN Incumbent Male 59
Board of 2011 2014
Directors
General
LIANG 15 April 16 April
Manager, Incumbent Male 49
JINHUI 2011 2014
Director
Director,
ZHOU Executive 15 April 16 April
Incumbent Male 39
QINGWU General 2011 2014
Manager
Vice
General
Manager,
Secretary
YE
of the 15 April 16 April
CHANGQ Incumbent Male 39
Board of 2011 2014
ING
Directors,
Chief
Accountan
t
WANG 15 April 16 April
Director Incumbent Male 48
FENG 2011 2014
YANG 15 April 16 April
Director Incumbent Male 45
XIAOFAN 2011 2014
WANG Independe 15 April 16 April
Incumbent Male 51
RUIHUA nt Director 2011 2014
WU Independe 15 April 16 April
Incumbent Male 51
CISHENG nt Director 2011 2014
LIU Independe 15 April 16 April
Incumbent Male 69
LIBIN nt Director 2011 2014
General
ZONG 12 June 16 April
Manage Incumbent Male 40
ZHAOJI 2012 2014
Assistant
42
2012 Annual Report of Anhui Gujing Distillery Company Limited
ZHAI General
12 June 16 April
LIANGD Manager Incumbent Male 42 1,200 1,200
2012 2014
ONG Assistant
General
12 June 16 April
FANG JI Manager Incumbent Male 46
2012 2014
Assistant
General
ZHANG 12 June 16 April
Manager Incumbent Male 44
LIHONG 2012 2014
Assistant
Chairman
of the
15 April 16 April
XU PENG Supervisor Incumbent Male 43
2011 2014
y
Committee
NIU 15 April 16 April
Supervisor Incumbent Male 42
HAITING 2011 2014
FU
15 April 16 April
QIANGXI Supervisor Incumbent Male 43
2011 2014
N
HU
15 April 16 April
WENCHA Supervisor Incumbent Male 47
2011 2014
O
LU
15 April 16 April
DUICAN Supervisor Incumbent Male 33
2011 2014
G
Total -- -- -- -- -- -- 1,200 0 0 1,200
II. Particulars about the employment
The main work experience of current directors, supervisors and senior executives over the past five years
(I) Mr. Yu Lin, 59 year-old, is Economic Engineer who is postgraduate degree holder, incumbent Director, Chairman of the Board of
the Company, Chairman of the Board of Anhui Gujing Group Co., Ltd. and Vice Chairman of CPPCC of Bozhou ; had ever acted as
worker, management of Chemical Fertilizer Plant of Bozhou County, Chief of Corporate Management of Ministry of Agriculture and
Economy of Bozhou City, Chief of Corporate Bureau of County of Bozhou City, Deputy Secretary of Bozhou Municipal Government,
Chief of Minority Development Bureau of Bozhou City, Director of Ministry of Economy of Bozhou City, Secretary of Party
Leadership Group, Vice Chairman of Political Consultative Conference of Bozhou City.
(II) Mr. Liang Jinhui, 49 year-old, is Political Engineer who has educational experience of graduate student, incumbent Director and
General Manager of the Company. He ever took posts of Secretary of Information Research Office of the Company, Editor in Chief
of Gujing Newspaper Office, Chief of Propaganda and Education Section, Vice Manager of Market Development Department of the
company, Supervisor of the Second Supervisory Committee, Manager of Market Development Department, Chief of Market
Research and Supervision Center, Supervisor of Third Supervisory Committee and Director of the Fourth Board of Directors,
Chairman of the Board of Bozhou Gujing Sales Company.
(III) Mr. Zhou Qingwu, 39 year-old, is Economist who has educational experience of undergraduate college. At present, he is
43
2012 Annual Report of Anhui Gujing Distillery Company Limited
Director and Executive Deputy General Manager of the Company, Vice Secretary of CPC of Gujing Group. He had ever acted as
Clerk and Deputy Sector Chief of Quality Control Section of Business Administration Department of the Company, Director of
Quality Control Center of Assets Management Department, Vice Manager and Manager of Quality Control Department, and
Chairman and General Manager of Bozhou Gujing Packing Material Co., Ltd.; Director of the 5th Board of Directors and Vice
General Manager.
(IV) Mr. Ye Changqing, 39 year-old, holder of master degree and International Certified Internal Auditor. Incumbent Director, Chief
Accountant and acting Secretary of Board of Directors of the company; started to work in July 1997, had ever acted Chief Auditor of
Audit Department, Vice Manager of Audit Department and Vice Supervisor and Supervisor of Auditing& Supervision Department;
and Supervisor of the Fourth Supervisory Committee; Director and Secretary of the 5th Board of Directors, Chief Accountant.
(V) Mr. Wang Feng, 48 year-old, is Senior Economic Engineer who is postgraduate degree holder, incumbent Director, Deputy
Secretary of CPC of Gujing Group. He had ever acted as Secretary of the League Committee of Bozhou Gujing Distillery; Deputy
Director of Economy Development Department; Deputy Director of Enterprises Management Department; Manager of Assets
Management Department of Gujing Group; Director, Secretary of the board, Vice General Manager, and General Manager of the
Second Board of Directors; Director and Chairman of the Third Board of Directors, and Director as well as Chairman of the Fourth
Board of Directors; Director of the 5th Board of Directors.
(VI) Mr. Yang Xiaofan, 45 year-old, holder of master degree. At present, he is Vice President of Gujing Group. He began to work in
1987, ever took posts of middle school teacher, journalist of newspaper office, propagandist of district office, teacher of normal
school, director of editors’ board of magazine; in Jul. 1993, he began to work in Gujing, he successively acted as Director of the
Editors’ Board of Gujing News, Chief of Propaganda, Manager of Propaganda and Information Department, Vice President and
General Manager of Anhui Gujing Real Estates Group Co., Ltd., Director and Assistant Chairman, Vice President of Gujing Group;
Director of the 5th Board of Directors.
(VII) Mr. Wang Ruihua, male, 51 years old, and accounting. Is now the company independent director, the central university of
finance and economics, director of the MBA education center, dean of school of business, accounting professor, doctoral supervisor,
Beijing zhongke three-ring high technology co., LTD., the independent directors, independent director of Beijing aerospace long feng
co., LTD., sinolink securities co., LTD., the independent directors. A former, deputy director of the central university of finance and
economics graduate students.
(VIII) Mr. Wu Cisheng, 51 year-old, who has Ph.D of Management Study, and is Professor of Management School, Dean of Business
Administration Department of Hefei University of Technology, Superintendent of Business Administration Research Institute, has
gained Master’s Degree of Industry Engineering in 1990, Ph. D of Business Administration in 2004; and had presided three national
social science fund projects, project topics of National Ministry of Science & Technology and National Bureau of Statistics
successively; had issued more than 60 theses on magazines in domestic and abroad successively, and published 6 works; and had
gained provincial and ministerial advance prize of science and technology. He is incumbent independent director of the company.
(IX) Mr. Liu Libin, 69 year-old, is incumbent Vice Chairman and Chief Secretary of China Advertising Association and President and
Chief Editor of International Advertising. He is the Doctor’s Tutor of Communication University of China, Visiting Professor of
many universities, Advisor of many brands, Superintendent of IAI International Advertising Institute, Chief Editor of Chinese
Advertisement Works Almanac and Chief Editor of Chinese Marketing Creative Works Almanac. And he has acted as member of a
review committee of various arts and advertisement exhibitions all around the country. And now he is incumbent the Independent
Director of the Company.
(X) Mr. Zong Zhaoji, Male, 40-year-old, engineer, achieved the diploma of junior college. He is now acting as General Manager
Assistant of the Company, General Manager of Bozhou Gujing Sales Co., Ltd. He once acted as clerk of Production Engineering
Department, Workshop Director of Jiufang Pharmaceuticals Company of Gujing Group, Salesman of Bozhou Gujing Sales Co., Ltd.,
Executive, Manager of Marketing Department, Regional Manager and Marketing Director.
(XI)Mr. Zhai Liangdong, Male, 42-year-old, achieved the Master degree. He is now acting as General Manager Assistant of the
Company, Chief Inspector of Administrative Center. He once acted as clerk of Labor Union Office of Gujing Group; clerk, Secretary,
44
2012 Annual Report of Anhui Gujing Distillery Company Limited
Deputy Director, Director of Gujing Group Office; Director of corporate office.
(XII) Mr. Fang Ji, Male, 46-year-old, is an account, economic engineer and engineer. He is now acting as General Manager Assistant
of the Company, Chief Inspector of Brewing Management Center. He once acted as programmer of corporate computer room,
headman of processing equipment team of Gujing Group， Factory Manager of Packaging Materials Factory, Manager of Production
Material Control Department, Manager of Power Department, Chief Inspector of Production Management Center.
(XIII) Mr. Zhang Lihong, Male, 44-year-old, economic engineering, achieved the Bachelor degree. He is now acting as General
Manager Assistant of the Company, Chief of HR Center. He once acted as clerk of Bozhou Gujing Sales Co., Ltd., Secretary of
Corporate Operation Department, Secretary of Market Development Department, Vice General Manager of Bozhou Gujing Sales Co.,
Ltd., Director of Comprehensive Office, Chief Inspector of Comprehensive Service Center.
(XIV) Mr. Xu Peng, 43 year-old, has educational experience of undergraduate college. He is incumbent Chief Supervisor of the
Company, Chief Inspector of Internal Audit Centre. And he had ever acted as Deputy Director and Director of Finance Second Office
of Finance Department of the Company, Manager of Finance Department of Anhui Laobada Co., Ltd., and Vice Manager and
Manager of Finance Department of the Company, Deputy General Manager and Chief Supervisor of Market Supervision Department
of Bozhou Gujing Sales Company.
(XV) Mr. Niu Haiting, 42 year-old, has educational experience of undergraduate college. He is incumbent Supervisor of the
Company, Member of Party Committee, and member of Commission for Disciplinary Inspection. He had ever acted as Personnel
Administrator, Vice Chief Supervisor of Human Resource Department of Anhui Gujing Group and Chief Inspector of Safety
Management Center.
(XVI) Mr. Fu Qiangxin, 43 year-old, bachelor degree, accountant, incumbent Supervisor and Vice Secretary of Discipline Inspection
Commission of Audit. He ever took posts of accountant of Bozhou Gujing Hotel, Manager of Finance of Bozhou Gujing Integrated
Services Company and Bozhou Gujing Import and Export Trade Company, clerk of Planning and Finance Department of Gujing
Group, Chief Inspector of Internal Audit Center.
(XVII) Mr. Hu Wenchao, is 47 year-old, Registered Senior Human Resource Specialist who has educational experience of
undergraduate college, National Trainer Grade 2 and one of Administrators recommended by China Human Resource Development
Association. Now he is incumbent Supervisor of the Company, Chief of HR Center of Anhui Gujing Group Co., Ltd. He had ever
acted as Labor Allocation Clerk and Deputy GM of Personnel Department, Vice Manager of HR Department of Anhui Gujing Group
Co., Ltd., Vice Manager of HR Department of Anhui Gujing Distillery Company Limited.
(XVIII) Mr. Lu Duicang, 33 year-old, has educational experience of undergraduate college. Now, he is incumbent Supervisor of the
Company and General Supervisor of Finance Department of Anhui Gujing Group Co., Ltd. He had ever acted as Accountant, Vice
Director and Director of Finance Department First Center of the Company, Factory Manager of Liquor Filling Branch Factory and
Manager of Finished Products Department.
Employment in shareholders’ entities
√ Applicable □ Non-Applicable
Whether receiving
Post held in Beginning date
Ending date of subsidies and
Name Name of shareholders’ entity shareholders’ of the office
the office term remuneration from
entity term
shareholders’ entities
Chairman of
YU LIN Anhui Gujing Group Co., Ltd. the Board of Yes
Directors
Deputy
WANG FENG Anhui Gujing Group Co., Ltd. Yes
Chairman of
45
2012 Annual Report of Anhui Gujing Distillery Company Limited
Party
Committee,
Chairman of
Discipline
Inspection
Committee
YANG Vice
Anhui Gujing Group Co., Ltd. Yes
XIAOFAN President
Deputy
ZHOU Chairman of
Anhui Gujing Group Co., Ltd. No
QINGWU Party
Committee
Vice
Chairman of
Discipline
Inspection
FU Committee,
Anhui Gujing Group Co., Ltd. Yes
QIANGXIN Chief
Inspector of
Audit
Inspection
Center
HU Chief of HR
Anhui Gujing Group Co., Ltd. Yes
WENCHAO Center
Chief
Inspector of
LU DUICANG Anhui Gujing Group Co., Ltd. Financial Yes
Management
Center
Explanation
about The above-mentioned personnel, though they take posts in shareholders’ entities, comply with the relevant
employment in employment requirements of Company Law, Securities Law and never were disciplined by CSRC, other relevant
shareholders’ departments and the Stock Exchange.
entities
Employment in other entities
□ Applicable √ Non-Applicable
III. Remuneration of directors, supervisors and senior executives
Decision-making procedure, basis for determination and actual payment of remuneration of directors, supervisors and senior
executives
(I) Decision-making procedure for the remuneration of directors, supervisors and senior management
The Remuneration & Appraisal Committee under the Board of Directors is in charge of drafting appraisal index of senior
46
2012 Annual Report of Anhui Gujing Distillery Company Limited
management and checking accomplishment of annual index.
(II) Basis for determining the remuneration of directors, supervisors and senior management
Remuneration of directors, supervisors and senior management is calculated by appraisal index drafted in year-begin and weight.
Financial index is on base of Auditor’s Report issued by certified public accountant, and comprehensive appraisal index is appraised
and discussed by the Remuneration & Appraisal Committee under the Board of Directors.
(III) Actual payment of the remuneration of directors, supervisors and senior management
Payment of the remuneration of directors, supervisors and senior management is with certain amount in advance monthly and
distributed annually according to check.
Particulars about remuneration of directors, supervisors and senior executives in the reporting period
Unit: RMB 0’000
Total amount Actual
Total amount
of payment got payment got at
Incumbent or of payment got
Name Title Gender Age from the the end of
not from the
shareholders’ reporting
Company
entities period
Chairman of
YU LIN the Board of Male 59 Incumbent 97.45 97.45
Directors
General
LIANG
Manager, Male 49 Incumbent 113.66 113.66
JINHUI
Director
Director,
ZHOU Executive Vice
Male 39 Incumbent 88.01 88.01
QINGWU General
Manager
Vice General
Manager,
Secretary of
YE
the Board of Male 39 Incumbent 76.76 76.76
CHANGQING
Directors,
Chief
Accountant
WANG FENG Director Male 48 Incumbent 90.6 90.6
YANG
Director Male 45 Incumbent 90.6 90.6
XIAOFAN
WANG Independent
Male 51 Incumbent 7.5 7.5
RUIHUA Director
Independent
WU CISHENG Male 51 Incumbent 7.5 7.5
Director
Independent
LIU LIBIN Male 69 Incumbent 7.5 7.5
Director
47
2012 Annual Report of Anhui Gujing Distillery Company Limited
General
ZONG
Manager Male 40 Incumbent 94.39 94.39
ZHAOJI
Assistant
General
ZHAI
Manager Male 42 Incumbent 69.45 69.45
LIANGDONG
Assistant
General
FANG JI Manager Male 46 Incumbent 74.4 74.4
Assistant
General
ZHANG
Manager Male 44 Incumbent 75.44 75.44
LIHONG
Assistant
Chairman of
XU PENG the Supervisory Male 43 Incumbent 70.84 70.84
Committee
NIU HAITING Supervisor Male 42 Incumbent 54.42 54.42
FU
Supervisor Male 43 Incumbent 56.86 7.67 64.53
QIANGXIN
HU
Supervisor Male 47 Incumbent 39.96 4.53 44.49
WENCHAO
LU DUICANG Supervisor Male 33 Incumbent 54.95 54.95
Total -- -- -- -- 836.69 345.8 1,182.49
Particulars about stock incentive granted to directors, supervisors and senior executives of the Company in the reporting period.
□ Applicable √ Non-Applicable
IV. Particulars about resignation and dismissal of directors, supervisors and senior executives
None
V. Particulars about changes in personnel of core technical team and crucial technical team (excluding directors, supervisors
and senior executives) in the reporting period
None
VI. Employees
Up to 31 Dec. 2012, the total number of current employees in the Company is 5,440
1. Particulars about professional categories
Professional category Number of personnel Proportion
Production staff 4,086 75.11%
Sales staff 570 10.48%
Technical staff 278 5.11%
Financial staff 77 1.42%
Administrative staff 429 7.89%
48
2012 Annual Report of Anhui Gujing Distillery Company Limited
Total 5,440 100.00%
Professional categories
Production staff
Sales staff
Technical staff
Financial staff
Administrative staff
2. Level of education
Level of education Number (person) proportion
High school and 4,305.00 79.14%
below
Junior college 574.00 10.55%
Bachelor degree 544.00 10.00%
Master degree or 17.00 0.31%
above
Total 5,440.00 100.00%
Level of education
High school and below
Junior college
Bachelor degree
Master degree or above
49
2012 Annual Report of Anhui Gujing Distillery Company Limited
Section VIII. Corporate Governance
I. Basic information about corporate governance
Since foundation, the Company constantly perfects corporate governance structure and standardize its management strictly in
accordance with the Company Law, Securities Law, Standard for Governance of Listed Companies, Guide Opinion on Setting up
Independent Directors Systems for Listed Companies as well as principles and requirements of other relevant laws, regulations and
normative documents.
In the reporting period, as per requirements of Basic Standard for Enterprise Internal Control and Shenzhen Stock Exchange
Guideline on Internal Control of Listed Companies, the Company developed internal control activity, implemented Rules on
Management of Assets Provision for Impairment, The Policy on the Liability of Disclosing Materially Inaccurate Information in
Annual Report, Rules for Management of External Information User and Rules for Management of Insider of Inner Information,
perfected internal control system step by step, promoted normative operation and healthy development. The Board of Directors, the
Supervisory Committee and the management of the Company make decisions, perform rights and assume obligation strictly
according to the standard operation rules and inner control system so as to make sure the standard operation of the Company in the
frame of rules and systems.
In the reporting period, according to requirements of China Securities Regulatory Commission and Rules for Listing of Shares in
Shenzhen Stock Exchange and with the “open, fair and just” principle, the Company seriously and timely performed information
disclosure obligation and guaranteed that the information disclosed is true, accurate and complete, free from fictitious presentation,
misleading statements or important omissions, so that all the shareholders will equally acquaint themselves with all the notices of the
Company.
After the reporting period, the Company will continuously optimize and perfect the corporate governance of listed companies, further
improve the standard operation of the Company.
Whether there existed differences between the corporate governance and relevant regulations of Company Law and CSRC or not
□ Yes √ No
There existed no difference between the corporate governance and relevant regulations of Company Law and CSRC.
Information about the progress of special activities of corporate governance and the formulation and implementation of registration
and management system for insiders
In order to further perfect the Company’s corporate governance, strengthen the management on the information disclosure for the
Company, the Company promulgated the Management Rules for Information Insider and Management Rules for Information
Reporting, Submission to and Use by External Parties, which were reviewed and approved at the 20th Session of the 5th Board of
Directors. In the reporting period, the company secretary was responsible for the disclosure of sensitive information. Before the
disclosure of any significant information in periodical reports or interim announcements, the personnel who had access to the insider
information all filled in the Registration Form for Information Insiders in a timely manner as required by Anhui Securities Regulatory
Bureau and Shenzhen Stock Exchange. During the reporting period, no insider traded the Company’s shares making use of the
insider information before the disclosure of significant sensitive information that might influence the Company’s stock price. During
the reporting period, the Company strictly carried out the Management Rules for Information Reporting, Submission to and Use by
External Parties, effectively controlling the reporting and submission of the Company’s business data, financial statements and other
internal information to external parties. No information of the Company was leaked against applicable laws and regulations.
II. Particulars about annual shareholders’ general meetings and temporary shareholders’ general meetings
1. Particulars about annual shareholders’ general meetings
50
2012 Annual Report of Anhui Gujing Distillery Company Limited
Session Opening date Name of proposal Resolution Disclosure date Index for disclosure
2011 Annual Report
of the Board of
Directors, 2011
Annual Report of the
Supervisory
Committee, 2011
Annual Report on
Financial Statement,
On the Cninfo
2011 Annual Report
website
and Abstract,
Announcement on
Proposal on 2011
Resolutions Passed
2011 Annual Annual Profit
All the proposals on the 2011 Annual
Shareholders’ 19 April 2012 Distribution and 20 April 2012
were passed. Shareholders’
General Meeting Transfer of Capital
General Meeting
Reserve to Common
（No. 2012-011）
Shares, Proposal on
http://www.cninfo.co
Project of Investing
m.cn
White Spirit
Industrial Park,
Proposal on
Amending Articles
of Association,
Proposal on
Employing Audit
Institution for 2012
2. Particulars about temporary shareholders’ general meeting
Session Opening date Name of proposal Resolution Disclosure date Index for disclosure
On the Cninfo
website
Proposal on Announcement on
Amending Articles Resolutions Passed
The 1st Temporary
of Association, Plan on the 1st Temporary
Shareholders’ The all proposals
15 Aug. 2012 on Rewarding the 16 Aug. 2012 Shareholders’
General Meeting in were passed
Shareholders of General Meeting in
2012
Anhui Gujing Co., 2012（No.
Ltd. (2012) 2012-022）
http://www.cninfo.co
m.cn
III. Duty performance of independent directors in the reporting period
1. Particulars about attendance of independent directors in the board meetings and shareholders’ general meetings
Particulars about attendance of independent directors in the board meetings
51
2012 Annual Report of Anhui Gujing Distillery Company Limited
Number of
Number of Whether being
meetings Number of Number of Number of
meetings absent from
Name of independent independent meetings meetings meetings skipped
attended in the meetings in
director directors are attended on the attended by from
means of person two times
supposed to spot mandatary
communication in succession
attend during the
reporting period
WANG RUIHUA 8 1 7 0 0 No
WU CISHENG 8 1 7 0 0 No
LIU LIBIN 8 1 7 0 0 No
Number of shareholders’ general
meetings attended by independent 2
directors
Notes to being absent from meetings in person two times in succession
2. Particulars about objections raised by independent directors about the relevant items of the Company
Whether independent directors raised objections about the relevant items of the Company?
□ Yes √ No
In the reporting period, independent directors raised no objection about the relevant items of the Company.
3. Other notes to duty performance of independent directors
Whether the advices of independent directors were taken by the Company?
√ Yes □ No
Explanation about whether the advices of independent directors were taken by the Company
In 2012, the 6th Board of Directors fulfilled their duties faithfully and responsibly, issued independent opinions on Self-appraisal
Report of Internal Control and Routine Related Transactions with the Related Parties on the basis of a detailed understanding of
corporate operation. They raised many constructive opinions and advices, which played an active part in the scientific and objective
decisions of the Board of directors and the benign development of the Company.
IV. Duty performance of special committees affiliated to the Board of Directors in the reporting period
1. Duty performance of the Strategy Committee
The Strategy Committee is under the leadership of the Board of Directors. In the reporting period, in strict compliance with the
Specific Implementation Rules for the Strategy Committee, the Strategy Committee conscientiously performed its duties, making a
lot of constructive suggestions for the efficient execution of the Company’s “12th Five-Year” strategy.
2. Duty performance of the Audit Committee
In the reporting period, five members of the Audit Committee diligently and responsibly performed their duties as stipulated in the
relevant rules of the Company:
(1) It reviewed the periodical reports of the Company in 2012.
(2) Upon discussion with RSM China Certified Public Accountants for the 2012 annual audit, it determined the schedule for the
financial report and internal control audit for 2012.
(3) It communicated in advance with the CPAs firm and independent directors before the CPAs firm came to the Company and
started the 2012 annual audit.
(3) It reviewed the short form of the preliminary financial statements prepared by the financial department of the Company for the
52
2012 Annual Report of Anhui Gujing Distillery Company Limited
first time before the annual auditor came to the Company and made some helpful suggestions.
(5) After the annual auditor came to the Company and started the audit, it communicated with the registered accountants on the
problems found in the audit and the submission time of the audit report.
(6) After the annual auditor issued the preliminary audit opinion, it reviewed the 2012 annual financial statements again and made the
final resolution.
3. Duty performance of the Nomination Committee
In the reporting period, in strict compliance with the Specific Implementation Rules of the Nomination Committee, the Nomination
Committee vigorously worked on various tasks, which ensured that the senior management staff of the Company were hired in
compliance with laws and regulations.
(1) In the reporting period, the senior management staff hired by the Company satisfied the requirements of the Company Law and
other relevant laws and regulations. They were qualified as senior management staff. They were not in such a case where the
Company Law should forbid them from being senior management staff. Nor they were forbidden by CSRC from entering the
securities market.
(2) In the reporting period, the senior management staff of the Company were nominated and hired in line with the Company Law
and the Company’s Articles of Association. The hired personnel have never been punished by CSRC, other relevant authorities or
stock exchanges.
4. Duty performance of Remuneration and Appraisal Committee
(1) The Remuneration and Appraisal Committee affiliated to the Board of Directors, according to relevant regulations of
Implementation Rules of Remuneration and Appraisal Committee successfully completed the annual performance appraisal to
directors, supervisors and senior executives in line with standards and procedures of performance appraisal during the reporting
period.
(2) Through the deliberation and assessment of the committee, the consistent opinion was that the general remuneration level
complied with development of the Company; the remuneration level of directors, supervisors and senior executives accurately
reflected the overall performance situation of the Company and individual work performance, which complied with the remuneration
management system; the remuneration plan and procedure of issuing remuneration were in accordance with the laws and did not
violate relevant national laws and regulations.
V. Information about work of the Supervisory Committee
Whether there existed any risk in the Company according to the supervision of the Supervisory Committee in the reporting period
□ Yes √ No
The Supervisory Committee raised no objection about matters of the Company under its supervision in the reporting period.
VI. Particulars about independence and completeness in business, personnel, assets, organizations and financial affairs
between this company and controlling shareholders
The company and the controlling shareholder, Anhui Gujing Group Co., Ltd., realized five independences in terms of business,
personnel, assets, organizations and financial affairs, with separate independent calculation, independent and complete business,
independent operation ability, and independent responsibilities and risks. Majority shareholders can not surpass the shareholders’
general meeting to directly or indirectly interfere with the company’s decisions and legal production and operation activities, and
there is no same trade competition state of the same products between the company and majority shareholders.
VII. Particulars about horizontal competition
None
VIII. Particulars about assessment and incentive mechanism to senior executives during the report period
The Company has set up a Performance Appraisal and Incentive Mechanism for Senior Executives, which links remuneration of
senior executives with the Company’ performance, the decision-making management adopts the assessment and incentive measures
by linking the annual remuneration with the Company’ economic indexes & management achievement. To promote the standard,
53
2012 Annual Report of Anhui Gujing Distillery Company Limited
healthy and orderly development of the company and keep the stability of the senior executives, the company annually sets up the
assessment index for them and signs a written responsibility of business target at the year-begin, then decides their remuneration and
the rewards & punishment at the year-end according to their personal work performance and completion of the Company’s operating
target.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Section IX Internal Control
I. Construction of internal control
In the reporting period, the Company, according to the requirements of normative documents including Basic Standards of Corporate
Internal Control, Appraisal Guideline for Corporate Internal Control (hereinafter referred to as Appraisal Guideline) and Guideline
for Internal Control of Listed Companies issued by Shenzhen Stock Exchange, founded leading team and work team of construction
and implementation of internal control and employed Huafu Kunming Consultants (Beijing) Co., Ltd. as the consultancy of internal
control system construction which guided the Company on and assisted the Company in the establishment and perfectness of internal
control system, formulated Management Manual of Internal Control, effectively managed and controlled in the aspects of strategic
risks, financial risks, operating risks and market risks, legal risks, enhanced the level of corporate operation and management and the
level of risk prevention. Note: for details see Self-assessment Report on 2012 Annual Internal Control published on the Cninfo
website on 23 April 2013.
II. Statement on the Responsibility for Internal Control from the Board of Directors
The Board of Directors and all its directors hereby ensure that this announcement contains no false information, misleading statement
or material omission, and shall be jointly and severally liable for the factuality, accuracy and completeness of the information carried
in this announcement. Establishing, perfecting and effectively conducting internal control is the liability of the Board of Directors;
establishment and implementation of internal control conducted by the Board is under the supervision of the supervisory committee;
the management is responsible for organizing and guiding daily operation of internal control. The objective of internal control:
reasonably guarantee the legality and compliance of the Company’s operating management, safety of assets, authenticity and
completeness of financial report and relevant information; enhance operation efficiency and improve operation results; promote the
realization of sustainable development.
III. Basis of establishing internal control of financial statements
Basis of establishing internal control of financial statements: the Company established comparatively sound internal control system
of financial management, according to requirements of relevant normative documents like Accounting Law, Accounting Standards
for Business Enterprises, Basic Standards of Corporate Internal Control, Evaluation Guideline for Corporate Internal Control.
IV. Self-assessment report of internal control
Specific details about significant defects of internal control during the reporting period found in self-assessment report of internal
control
None
Disclosure date of whole article of
self-assessment report of internal 23 April 2013
control
Index for disclosure of whole
Cninfo website (www.cninfo.com.cn) “2012 Annual Self-assessment Report of Internal
article of self-assessment report of
Control”
internal control
V. Audit report of internal control
√ Applicable □ Non-Applicable
Audit opinion in audit report of internal control
55
2012 Annual Report of Anhui Gujing Distillery Company Limited
We believe, Anhui Gujing Distillery Co., Ltd. maintained effective internal control of financial statements in all significant aspects
on 31 Dec. 2012 in accordance with Basic Standards for Internal Control and relevant regulations.
Disclosure date of whole article of
23 April 2013
audit report of internal control
Index for disclosure of whole
article of audit report of internal Cninfo website (www.cninfo.com.cn) “Audit Report of Internal Control”
control
Whether the accounting firm issued non-standard audit report of internal control
□ Yes √ No
Whether audit report of internal control issued by accounting firm was consistent with self-assessment report of the board of directors
√ Yes □ No
VI. Establishment and implementation of institution of clarifying responsibility for major mistakes in annual report
In order to improve the standard operation of the Company, strengthen the factuality, accuracy, completeness and promptness of
information disclosure and enhance the quality and transparency of information disclosed in annual reports, the Company formulated
System of Clarifying Responsibility for Major Mistakes in Information Disclosure of Annual Report and clarified the responsibilities
for major mistakes in information disclosure of annual reports, according to the relevant laws and regulations. In the reporting period,
the Company strictly implemented the above system and did not conduct correction of major mistakes, supplementation for
significant omitted information and revise of performance bulletin.
56
2012 Annual Report of Anhui Gujing Distillery Company Limited
Section X. Financial report
I. Audit Report
Type of audit opinion Standard unqualified audit opinion
Date of signing audit report 21 April 2013
RSM China Certified Public Accountants (Special General
Name of audit institution
Partnership)
Reference number of audit report RSM China SZ [2013] No. 5933
Main body of audit report
To the Shareholders of Anhui Gujing Distillery Co., Ltd.:
We have audited the attached financial statements of Anhui Gujing Distillery Co., Ltd. (“the Company”), which comprise the
consolidated and the Company’s balance sheet as at December 31, 2011, the consolidated and the Company’s income statement, the
consolidated and the Company’s cash flow statement, the consolidated and the Company’s statement of changes in owners’ equity for
the year then ended, and the notes to financial statements.
I. Responsibilities of the management concerning the financial statements
The management of the Company is responsible for the preparation of these financial statements and fair presentation. These
responsibilities include: (1) preparing financial statements according to the Accounting Standards for Business Enterprises and make
them a fair presentation; and (2) designing, implementing and maintaining internal control relevant to the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
II. Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in
accordance with the Chinese Certified Public Accountants' Auditing Standards. These standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amount and disclosures in the financial statements. The
procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the
entity’s preparation of the consolidation financial statements and fair presentation in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
An audit also includes evaluating the appropriateness of accounting policies used and reasonableness of accounting estimates made
by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Opinion
In our opinion, the financial statements have been prepared in accordance with the requirements of the Enterprises Accounting
Standards promulgated by the People’s Republic of China in all material respects, and present fairly the consolidated operating
results of Anhui Gujing Distillery Co., Ltd. and its subsidiaries as at December 31, 2012, and consolidated operating results and cash
flow in 2012 as well as the operating results at 31 Dec. 2012 and the operating results & cash flow in 2012 of Anhui Gujing Distillery
Co., Ltd..
II. Financial Statement
Unit of statements in the notes appended to financial report is RMB Yuan
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2012 Annual Report of Anhui Gujing Distillery Company Limited
1. Consolidated balance sheet
Prepared by Anhui Gujing Distillery Company Limited
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 2,609,650,352.09 2,082,032,491.33
Settlement reserves
Intra-group lendings
Transactional financial assets
Notes receivable 156,449,495.65 490,543,018.49
Accounts receivable 7,887,007.25 37,685,831.22
Accounts paid in advance 85,305,973.47 233,262,710.73
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable 7,253,858.34 4,451,540.35
Dividend receivable
Other accounts receivable 21,559,146.98 7,882,417.86
Financial assets purchased under
agreements to resell
Inventories 782,399,498.85 578,157,069.43
Non-current assets due within 1 year
Other current assets
Total current assets 3,670,505,332.63 3,434,015,079.41
Non-current assets:
Loans by mandate and advances
granted
Available-for-sale financial assets 27,991,376.84
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment
Investing property 31,451,269.49 32,558,410.26
Fixed assets 783,740,205.15 362,778,190.84
Construction in progress 423,672,281.54 133,017,100.51
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 320,716,225.67 248,594,232.04
R&D expense
Goodwill
Long-term deferred expenses 30,959,542.67 9,678,465.54
Deferred income tax assets 19,091,237.05 21,178,071.70
Other non-current assets
Total of non-current assets 1,637,622,138.41 807,804,470.89
Total assets 5,308,127,471.04 4,241,819,550.30
Current liabilities:
Short-term borrowings
Borrowings from Central Bank
Customer bank deposits and due to
banks and other financial institutions
Intra-group borrowings
Transactional financial liabilities
Notes payable 224,460,000.00
Accounts payable 461,112,575.26 219,823,856.45
Accounts received in advance 114,610,235.81 135,597,187.88
Financial assets sold for repurchase
Handling charges and commissions
payable
Employee’s compensation payable 178,726,582.68 192,762,077.27
Tax payable 645,410,021.57 671,079,511.43
Interest payable
Dividend payable
Other accounts payable 297,098,777.98 248,890,018.78
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting underwriting of
59
2012 Annual Report of Anhui Gujing Distillery Company Limited
securities
Non-current liabilities due within 1
year
Other current liabilities 2,120,250.11 2,075,708.75
Total current liabilities 1,923,538,443.41 1,470,228,360.56
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
Deferred income tax liabilities 697,845.96
Other non-current liabilities 8,403,073.03 10,475,905.29
Total non-current liabilities 9,100,918.99 10,475,905.29
Total liabilities 1,932,639,362.40 1,480,704,265.85
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 503,600,000.00 251,800,000.00
Capital reserves 1,297,032,031.07 1,546,738,493.19
Less: Treasury stock
Specific reserves
Surplus reserves 218,736,964.73 147,070,297.60
Provisions for general risks
Retained profits 1,356,119,112.84 815,506,493.66
Foreign exchange difference
Total equity attributable to owners of
3,375,488,108.64 2,761,115,284.45
the Company
Minority interests
Total owners’ (or shareholders’) equity 3,375,488,108.64 2,761,115,284.45
Total liabilities and owners’ (or 5,308,127,471.04 4,241,819,550.30
shareholders’) equity
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
2. Balance sheet of the Company
Prepared by Anhui Gujing Distillery Company Limited
60
2012 Annual Report of Anhui Gujing Distillery Company Limited
Unit: Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 2,390,346,607.43 1,885,937,555.53
Transactional financial assets
Notes receivable 139,414,615.95 481,125,332.25
Accounts receivable 1,293,202.89 1,857,487.49
Accounts paid in advance 1,151,359.52 148,873,681.27
Interest receivable 6,129,902.78 4,395,740.35
Dividend receivable
Other accounts receivable 161,967,822.69 263,635,938.96
Inventories 748,777,364.57 545,878,714.66
Non-current assets due within 1 year
Other current assets
Total current assets 3,449,080,875.83 3,331,704,450.51
Non-current assets:
Available-for-sale financial assets 27,991,376.84
Held-to-maturity investments
Long-term accounts receivable 4,172,166.85
Long-term equity investment 258,089,408.32 247,991,408.32
Investing property 29,814,360.87 32,558,410.26
Fixed assets 562,993,821.32 152,140,192.21
Construction in progress 423,672,281.54 132,982,180.51
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 200,084,457.08 124,709,474.17
R&D expense
Goodwill
Long-term deferred expenses 27,338,996.93 4,536,265.22
Deferred income tax assets 18,496,292.51 20,167,034.56
Other non-current assets
Total of non-current assets 1,552,653,162.26 715,084,965.25
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Total assets 5,001,734,038.09 4,046,789,415.76
Current liabilities:
Short-term borrowings
Transactional financial liabilities
Notes payable 80,000,000.00
Accounts payable 446,890,857.97 225,568,150.93
Accounts received in advance 714,794,965.38 590,174,171.08
Employee’s compensation payable 79,627,703.42 102,876,125.19
Tax payable 314,625,057.22 446,265,127.40
Interest payable
Dividend payable
Other accounts payable 168,504,557.80 89,012,417.91
Non-current liabilities due within 1
year
Other current liabilities 1,998,845.04 1,798,000.00
Total current liabilities 1,806,441,986.83 1,455,693,992.51
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
Deferred income tax liabilities 697,845.96
Other non-current liabilities 8,403,073.03 10,354,500.20
Total non-current liabilities 9,100,918.99 10,354,500.20
Total liabilities 1,815,542,905.82 1,466,048,492.71
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 503,600,000.00 251,800,000.00
Capital reserves 1,249,255,645.23 1,498,962,107.35
Less: Treasury stock
Specific reserves
Surplus reserves 213,634,704.46 141,968,037.33
Provision for general risks
Retained profits 1,219,700,782.58 688,010,778.37
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Foreign exchange difference
Total owners’ (or shareholders’) equity 3,186,191,132.27 2,580,740,923.05
Total liabilities and owners’ (or
5,001,734,038.09 4,046,789,415.76
shareholders’) equity
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
3. Consolidated income statement
Prepared by Anhui Gujing Distillery Company Limited
Unit: Yuan
Item Amount of this period Amount of last period
I. Total operating revenues 4,197,057,315.26 3,307,979,236.00
Including: Sales income 4,197,057,315.26 3,307,979,236.00
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 3,243,155,636.29 2,473,852,861.75
Including: Cost of sales 1,220,831,141.50 861,012,764.70
Interest expenses
Handling charge and
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for the
insurance contract reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 638,945,267.01 522,390,054.93
Selling and distribution expenses 1,075,977,234.87 798,067,079.39
Administrative expenses 393,028,645.85 345,615,957.58
Financial expenses -88,430,981.17 -51,871,404.15
Asset impairment loss 2,804,328.23 -1,361,590.70
Add: Gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-” 1,656,581.66
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2012 Annual Report of Anhui Gujing Distillery Company Limited
means loss)
Including: share of profits in associates
and joint ventures
Foreign exchange gains (“-” means
loss)
III. Business profit (“-” means loss) 953,901,678.97 835,782,955.91
Add: non-operating income 21,972,077.88 16,911,302.91
Less: non-operating expense 3,446,696.09 2,619,353.87
Including: loss from non-current asset
511,271.68 396,678.97
disposal
IV. Total profit (“-” means loss) 972,427,060.76 850,074,904.95
Less: Income tax expense 246,837,774.45 283,684,618.59
V. Net profit (“-” means loss) 725,589,286.31 566,390,286.36
Including: Net profit achieved by
combined parties before the
combinations
Attributable to owners of the
725,589,286.31 566,390,286.36
Company
Minority shareholders’ income
VI. Earnings per share -- --
(I) Basic earnings per share 1.44 1.17
(II) Diluted earnings per share 1.44 1.17
Ⅶ. Other comprehensive incomes 2,093,537.88
Ⅷ. Total comprehensive incomes 727,682,824.19 566,390,286.36
Attributable to owners of the
727,682,824.19 566,390,286.36
Company
Attributable to minority
shareholders
Where business mergers under the same control occurred in this report period, the net profit achieved by the merged parties before
the business mergers was RMB 0.
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
4. Income statement of the Company
Prepared by Anhui Gujing Distillery Company Limited
Unit: Yuan
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Item Amount of this period Amount of last period
I. Total sales 2,535,315,597.69 1,957,164,481.24
Less: cost of sales 1,207,277,936.81 827,862,350.62
Business taxes and surcharges 604,155,623.28 495,328,024.61
Distribution expenses 364,959,419.40 190,724,471.78
Administrative expenses 240,774,307.44 222,853,051.65
Financial costs -71,949,250.84 -33,627,927.71
Impairment loss 3,629,434.58 -1,535,341.86
Add: gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-” means
570,794,532.17 371,010,624.52
loss)
Including: income form investment on
associates and joint ventures
II. Business profit (“-” means loss) 757,262,659.19 626,570,476.67
Add: non-business income 15,984,988.19 7,458,576.15
Less: non-business expense 1,770,071.21 1,848,819.85
Including: loss from non-current asset
8,044.53
disposal
III. Total profit (“-” means loss) 771,477,576.17 632,180,232.97
Less: income tax expense 54,810,904.83 134,309,163.96
IV. Net profit (“-” means loss) 716,666,671.34 497,871,069.01
V. Earnings per share -- --
(I) Basic earnings per share 1.42 0.99
(II) Diluted earnings per share 1.42 0.99
VI. Other comprehensive income 2,093,537.88
VII. Total comprehensive income 718,760,209.22 497,871,069.01
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing Chief of the
accounting division: Xia Xueyun
5. Consolidated cash flow statement
Prepared by Anhui Gujing Distillery Company Limited
Unit: Yuan
Item Amount of this period Amount of last period
I. Cash flows from operating activities:
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Cash received from sale of
5,256,820,153.39 3,467,179,264.61
commodities and rendering of service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the central
bank
Net increase of funds borrowed from
other financial institutions
Cash received from premium of
original insurance contracts
Net cash received from reinsurance
business
Net increase of deposits of policy
holders and investment fund
Net increase of disposal of tradable
financial assets
Cash received from interest, handling
charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in repurchase
business
Tax refunds received 642,100.00 976,614.88
Other cash received relating to
152,260,005.14 213,872,969.49
operating activities
Subtotal of cash inflows from operating
5,409,722,258.53 3,682,028,848.98
activities
Cash paid for goods and services 1,117,167,748.88 1,108,607,023.23
Net increase of customer lendings
and advances
Net increase of funds deposited in the
central bank and amount due from
banks
Cash for paying claims of the original
insurance contracts
Cash for paying interest, handling
charges and commissions
Cash for paying policy dividends
66
2012 Annual Report of Anhui Gujing Distillery Company Limited
Cash paid to and for employees 722,698,221.19 516,181,360.59
Various taxes paid 1,556,750,391.03 981,128,678.39
Other cash payment relating to
726,238,532.97 450,210,319.42
operating activities
Subtotal of cash outflows from
4,122,854,894.07 3,056,127,381.63
operating activities
Net cash flows from operating activities 1,286,867,364.46 625,901,467.35
II. Cash flows from investing activities:
Cash received from withdrawal of
investments
Cash received from return on
investments
Net cash received from disposal of
fixed assets, intangible assets and other 68,940.95 987,318.61
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
240,000.00 8,100,000.00
investing activities
Subtotal of cash inflows from
308,940.95 9,087,318.61
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 621,048,614.85 344,656,892.95
assets
Cash paid for investment 25,199,993.00
Net increase of pledged loans
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
646,248,607.85 344,656,892.95
investing activities
Net cash flows from investing activities -645,939,666.90 -335,569,574.34
III. Cash Flows from Financing
Activities:
Cash received from capital
1,231,500,000.00
contributions
Including: Cash received from
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2012 Annual Report of Anhui Gujing Distillery Company Limited
minority shareholder investments by
subsidiaries
Cash received from borrowings
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
1,231,500,000.00
activities
Repayment of borrowings
Cash paid for interest expenses and
113,310,000.00 79,818,322.54
distribution of dividends or profit
Including: dividends or profit paid
by subsidiaries to minority shareholders
Other cash payments relating to
200,000,000.00 3,211,800.00
financing activities
Sub-total of cash outflows from
313,310,000.00 83,030,122.54
financing activities
Net cash flows from financing activities -313,310,000.00 1,148,469,877.46
IV. Effect of foreign exchange rate
162.90 -683.56
changes on cash and cash equivalents
V. Net increase in cash and cash
327,617,860.76 1,438,801,086.91
equivalents
Add: Opening balance of cash and
2,082,032,491.33 643,231,404.42
cash equivalents
VI. Closing balance of cash and cash
2,409,650,352.09 2,082,032,491.33
equivalents
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
6. Cash flow statement of the Company
Prepared by Anhui Gujing Distillery Company Limited
Unit: Yuan
Item Amount of this period Amount of last period
I. Cash flows from operating activities:
Cash received from sale of
3,423,191,472.27 2,185,615,817.88
commodities and rendering of service
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Tax refunds received
Other cash received relating to
237,910,854.26 67,797,805.76
operating activities
Subtotal of cash inflows from operating
3,661,102,326.53 2,253,413,623.64
activities
Cash paid for goods and services 1,374,069,572.75 1,022,068,472.17
Cash paid to and for employees 336,171,582.81 235,666,465.31
Various taxes paid 1,111,980,958.34 692,592,618.07
Other cash payment relating to
173,079,396.45 78,996,659.00
operating activities
Subtotal of cash outflows from
2,995,301,510.35 2,029,324,214.55
operating activities
Net cash flows from operating activities 665,800,816.18 224,089,409.09
II. Cash flows from investing activities:
Cash received from retraction of
9,900,000.00 10,000,000.00
investments
Cash received from return on
570,794,532.17 363,057,695.16
investments
Net cash received from disposal of
fixed assets, intangible assets and other 68,940.95 276,019.86
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
1,240,000.00 8,100,000.00
investing activities
Subtotal of cash inflows from
582,003,473.12 381,433,715.02
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 584,887,244.40 318,792,844.60
assets
Cash paid for investment 45,197,993.00 30,000,000.00
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
630,085,237.40 348,792,844.60
investing activities
Net cash flows from investing activities -48,081,764.28 32,640,870.42
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2012 Annual Report of Anhui Gujing Distillery Company Limited
III. Cash Flows from Financing
Activities:
Cash received from capital
1,231,500,000.00
contributions
Cash received from borrowings
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
1,231,500,000.00
activities
Repayment of borrowings
Cash paid for interest expenses and
113,310,000.00 79,818,322.54
distribution of dividends or profit
Other cash payments relating to
100,000,000.00 3,211,800.00
financing activities
Sub-total of cash outflows from
213,310,000.00 83,030,122.54
financing activities
Net cash flows from financing activities -213,310,000.00 1,148,469,877.46
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
404,409,051.90 1,405,200,156.97
equivalents
Add: Opening balance of cash and
1,885,937,555.53 480,737,398.56
cash equivalents
VI. Closing balance of cash and cash
2,290,346,607.43 1,885,937,555.53
equivalents
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing Chief of the
accounting division: Xia Xueyun
7. Consolidated statement of changes in owners’ equity
Prepared by Anhui Gujing Distillery Company Limited
Amount of this period
Unit: Yuan
Amount of this period
Item Equity attributable to owners of the Company Minority Total
Paid-up Capital Less: Specific Surplus General Retaine Others interests owners’
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2012 Annual Report of Anhui Gujing Distillery Company Limited
capital reserve treasury reserve reserve risk d profit equity
(or stock reserve
share
capital)
I. Balance at the end of the 251,800 1,546,73 147,070 815,506, 2,761,115,
previous year ,000.00 8,493.19 ,297.60 493.66 284.45
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 251,800 1,546,73 147,070 815,506, 2,761,115,
the year ,000.00 8,493.19 ,297.60 493.66 284.45
III. Increase/ decrease of
251,800 -249,70 71,666, 540,612, 614,372,82
amount in the year (“-” means
,000.00 6,462.12 667.13 619.18 4.19
decrease)
725,589, 725,589,28
(I) Net profit
286.31 6.31
(II) Other comprehensive 2,093,53 2,093,537.
incomes 7.88 88
2,093,53 725,589, 727,682,82
Subtotal of (I) and (II)
7.88 286.31 4.19
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
3. Others
71,666, -184,97 -113,310,0
(IV) Profit distribution
667.13 6,667.13 00.00
1. Appropriations to 71,666, -71,666,
surplus reserves 667.13 667.13
2. Appropriations to
general risk provisions
3. Appropriations to -113,31 -113,310,0
owners (or shareholders) 0,000.00 00.00
4. Other
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2012 Annual Report of Anhui Gujing Distillery Company Limited
(V) Internal carry-forward of 251,800 -251,80
owners’ equity ,000.00 0,000.00
1. New increase of capital
251,800 -251,80
(or share capital) from capital
,000.00 0,000.00
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(Ⅶ) Other
503,600 1,297,03 218,736 1,356,11 3,375,488,
IV. Closing balance
,000.00 2,031.07 ,964.73 9,112.84 108.64
Amount of last period
Unit: Yuan
Amount of last period
Equity attributable to owners of the Company
Paid-up
Total
Item capital Minority
Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 235,000 336,039, 97,283, 381,153, 1,049,475,
previous year ,000.00 042.92 190.70 314.20 547.82
Add: retrospective
adjustments due to business
combinations under the same
control
Add: change of accounting
policy
Correction of errors in
previous periods
Other
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2012 Annual Report of Anhui Gujing Distillery Company Limited
II. Balance at the beginning of 235,000 336,039, 97,283, 381,153, 1,049,475,
the year ,000.00 042.92 190.70 314.20 547.82
III. Increase/ decrease of
16,800, 1,210,69 49,787, 434,353, 1,711,639,
amount in the year (“-” means
000.00 9,450.27 106.90 179.46 736.63
decrease)
566,390, 566,390,28
(I) Net profit
286.36 6.36
(II) Other comprehensive
incomes
566,390, 566,390,28
Subtotal of (I) and (II)
286.36 6.36
(III) Capital paid in and 16,800, 1,210,69 1,227,499,
reduced by owners 000.00 9,450.27 450.27
1. Capital paid in by 16,800, 1,210,69 1,227,499,
owners 000.00 9,450.27 450.27
2. Amounts of share-based
payments recognized in
owners’ equity
3. Others
49,787, -132,03 -82,250,00
(IV) Profit distribution
106.90 7,106.90 0.00
1. Appropriations to 49,787, -49,787,
surplus reserves 106.90 106.90
2. Appropriations to
general risk provisions
3. Appropriations to -82,250, -82,250,00
owners (or shareholders) 000.00 0.00
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
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2012 Annual Report of Anhui Gujing Distillery Company Limited
(Ⅵ) Specific reserve
1. Withdrawn for the
period
2. Used in the period
(Ⅶ) Other
251,800 1,546,73 147,070 815,506, 2,761,115,
IV. Closing balance
,000.00 8,493.19 ,297.60 493.66 284.45
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
8. Statement of changes in owners’ equity of the Company
Prepared by Anhui Gujing Distillery Company Limited
Amount of this period
Unit: Yuan
Amount of this period
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
I. Balance at the end of the 251,800,00 1,498,962, 141,968,03 688,010,77 2,580,740,
previous year 0.00 107.35 7.33 8.37 923.05
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 251,800,00 1,498,962, 141,968,03 688,010,77 2,580,740,
the year 0.00 107.35 7.33 8.37 923.05
III. Increase/ decrease of amount 251,800,00 -249,706,4 71,666,667 531,690,00 605,450,20
in the year (“-” means decrease) 0.00 62.12 .13 4.21 9.22
716,666,67 716,666,67
(I) Net profit
1.34 1.34
(II) Other comprehensive 2,093,537. 2,093,537.
incomes 88 88
2,093,537. 716,666,67 718,760,20
Subtotal of (I) and (II)
88 1.34 9.22
(III) Capital paid in and
reduced by owners
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2012 Annual Report of Anhui Gujing Distillery Company Limited
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
71,666,667 -184,976,6 -113,310,0
(IV) Profit distribution
.13 67.13 00.00
1. Appropriations to surplus 71,666,667 -71,666,66
reserves .13 7.13
2. Appropriations to general
risk provisions
3. Appropriations to owners -113,310,0 -113,310,0
(or shareholders) 00.00 00.00
4. Other
(V) Internal carry-forward of 251,800,00 -251,800,0
owners’ equity 0.00 00.00
1. New increase of capital
251,800,00 -251,800,0
(or share capital) from capital
0.00 00.00
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the period
2. Used in the period
(Ⅶ) Other
503,600,00 1,249,255, 213,634,70 1,219,700, 3,186,191,
IV. Closing balance
0.00 645.23 4.46 782.58 132.27
Amount of last period
Unit: Yuan
Amount of last period
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
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2012 Annual Report of Anhui Gujing Distillery Company Limited
I. Balance at the end of the 235,000,00 288,262,65 92,180,930 322,176,81 937,620,40
previous year 0.00 7.08 .43 6.26 3.77
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 235,000,00 288,262,65 92,180,930 322,176,81 937,620,40
the year 0.00 7.08 .43 6.26 3.77
III. Increase/ decrease of amount 16,800,000 1,210,699, 49,787,106 365,833,96 1,643,120,
in the year (“-” means decrease) .00 450.27 .90 2.11 519.28
497,871,06 497,871,06
(I) Net profit
9.01 9.01
(II) Other comprehensive
incomes
497,871,06 497,871,06
Subtotal of (I) and (II)
9.01 9.01
(III) Capital paid in and 16,800,000 1,210,699, 1,227,499,
reduced by owners .00 450.27 450.27
16,800,000 1,210,699, 1,227,499,
1. Capital paid in by owners
.00 450.27 450.27
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
49,787,106 -132,037,1 -82,250,00
(IV) Profit distribution
.90 06.90 0.00
1. Appropriations to surplus 49,787,106 -49,787,10
reserves .90 6.90
2. Appropriations to general
risk provisions
3. Appropriations to owners -82,250,00 -82,250,00
(or shareholders) 0.00 0.00
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
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2012 Annual Report of Anhui Gujing Distillery Company Limited
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve
1. Withdrawn for the period
2. Used in the period
(Ⅶ) Other
251,800,00 1,498,962, 141,968,03 688,010,77 2,580,740,
IV. Closing balance
0.00 107.35 7.33 8.37 923.05
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Xia Xueyun
Anhui Gujing Distillery Co., Ltd.
Notes to the Financial Statements
For the Year Ended 31 December 2012
(All amounts are expressed, unless otherwise stated, in Renminbi (CNY).)
Note 1: Company Profile
1.1 History
Anhui Gujing Distillery Co., Ltd. (hereafter “the Company” or "Company") was the company limited by shares approved by Administration Bureau of
State-owned Property of Anhui province following the approval WanGuoZiGongZi (1996) NO. 053 (皖国资工字(1996)第053号文), Anhui Gujing
Group Co., Ltd. as the sole sponsors, established net assets in the assessment of main production operating assets of its core company Anhui
Bozhou Gujing distillery 377.1677 million transferred into the 155,000,000 state-owned shares, and the registered location was the Bozhou City of
People's Republic of China. The company was registered in the The People's Republic of China on 5 March 1996 and was approved by People’s
Government of Anhui province following the approval WanZhengMin (1996) NO.42 (皖政秘(1996)42 号文). The company convoked the founding
meeting on 28 May 1996, and registrated on 30 May 1996 by Administration for Industry and Commerce of Anhui province. The registration number
of Business License for Enterprise as a Legal Person is: 14897271-1.
The Company has been issued 60,000,000 domestic listed foreign shares (hereafter “B” shares) in June 1996 and 20,000,000 domestic listed
CNY ordinary shares (hereafter “A” shares) in September 1996, the par value of ordinary shares is CNY1.00 per share. Both A share and B share
are listed in Shenzhen Stock exchange.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The headquarters of the company is located in Gujing town, Bozhou city, Anhui province. The company and the subsidiaries (collectively called
“Group”) is mainly engaged in liquor production and sales, it belongs to the food manufacturing industry.
The original registered capital was CNY 215 million, the total amount of shares were 215 million, including state-owned shares 155 million and
domestic listed foreign shares 60 million, the par value is CNY 1 per share.
On 29 May 2006, the shareholder meeting for the Company’s shareholdings reform of A-share market have been discussed and approved the
proposal of the shareholdings reform, and that has been implemented in June 2006. After the Company’s shareholdings reform implemented, all
shares of the Company became floating shares, which including 147,000,000 shares with restrict condition on disposal, represent 62.55% of total
share capital, and 88,000,000 shares without restrict condition on disposal, represent 37.45% of total share capital.
On 27 June 2007, the Company issued the , the 11,750,000
restricted outstanding shares with restrict condition on disposal became non-restricted in stock market, and the conversion date is on 29 June
2007. Hence, outstanding shares with restrict condition on disposal are 135,250,000 shares, representing 57.55% of total share capital, the share
without restrict condition on disposal are 99,750,000 shares, representing 42.45% of total share capital.
On 17 July 2008, the Company issued the , the 11,750,000
restricted outstanding shares with restrict condition on disposal became non-restricted in stock market, and the conversion date is on 18 July
2008. Hence, outstanding shares with restrict condition on disposal are 123,500,000 shares, representing 52.55% of total share capital, the
share without restrict condition on disposal are 111,500,000 shares, representing 47.45% of total share capital.
On 24 July 2009, the Company issued the , the
123,500,000 restricted outstanding shares with restrict condition on disposal became non-restricted in stock market, and the
conversion date is on 29 July 2009. Hence, all shares of the Company were became outstanding shares without restrict condition on disposal.
According to the approval by China Securities Regulatory Commission (the authorization file No. zhengjianxuke[2011]943), on 15th July 2011, the
Company private issued 16,800,000 shares of ordinary share (A shares) to specific investors, the par value in CNY 1 per share, and the offering
price is CNY 75 per share, the funds raised amounting to CNY 1,260 million, deduct those sundry issuing charges amounting to CNY 32,500,549.73,
the actual funds raised net amounting to CNY 1,227,499,450.27. The above funds have been reviewed by Reanda Certified Public Accountants Co.,
Ltd., and issued the Capital Verification Report (REANDA YAN ZI[2011]No.1065). After private issued, the share capital was increased to CNY
251.8 million.
According to the resolution of 2011 annual general meeting of stockholders, every 10 shares transferred to increase 10 shares by capital reserves
used the base of the 251.8 million shares on 31 December, 2011, the total amount of increase by transferring were 251.8 million shares and has
been implemented in 2012. After increase by transferring the registered capital was increased to CNY 503.6 million.
Up to 31 December, 2012, the accumulated total amount of issued capital was 503.6 million shares, see the note 7.24.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The approved business scope: grain procurement (operation by license), manufacture of distilled spirits, beer, red wine, facilities for wine making,
packaging materials, and glass bottles, alcohol, feeds, grease (limited to the by-products from alcohol manufacture), development of high-tech,
biotechnology development agricultural and sideline products deep processing, sales of goods from own production.
The parent company of the group and ultimate parent company is the Anhui Gujing Group Co., Ltd.
The financial statement is approved by the resolution of board of directors on 21 April, 2013. According to the articles of association, the financial
statements will be submitted to the shareholders meeting for consideration.
Note 2: Basis for preparation of the financial statements
The financial statements of company have been prepared on basis of going concern in conformity with Chinese Accounting Standards for Business
Enterprises and the Accounting Systems for Business Enterprises issued by the Ministry of Finance of People’s Republic of China in February 2006,
and Accounting Standards (order No.38 of the Ministry of Finance) and Compilation Rules for Information Disclosure by Companies Offering
Securities to the Public No.15 – General Provisions on Financial Reports (2010 Revision) issued by the China Securities Regulatory Commission
(CSRC).
According to the relevant accounting regulations in Chinese Accounting Standards for Business Enterprises, the company has adopted the accrual
basis of accounting. Except for certain financial instruments which are measured by at fair value, the Company adopts the historical cost as the
principle of measurement in the financial statements. Where assets are impaired, provisions for asset impairment are made in accordance with
relevant requirements.
Note 3: Statement of Compliance with Enterprise Accounting Standards
The financial statements of the company are recognized and measured in accordance with the regulations in the Chinese Accounting Standards for
Business Enterprises and they give a true and fair view of the financial position, business result and cash flow of the Company as of 31 December
2012 .In addition, the financial statements of the company comply, in all material respects, with the revised disclosing requirements for financial
statements and the Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15—General Provisions on
Financial Reports (2010 Revision) issued by China Securities Regulatory Commission (CSRC) in 2010.
Note 4: Important Accounting Principles and Accounting Estimates
4.1 Accounting period
The accounting period of the Company is classified as interim period and annual period. Interim period refers to the reporting period shorter than a
complete annual period. The accounting period of the Company is the calendar year from January 1 to December 31.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
4.2 Monetary Unit
Yuan (CNY) is the currency of the primary economic environment in which the Company and its domestic subsidiaries operate. Therefore, the
Company and its domestic subsidiaries choose CNY as their functional currency. The Company adopts CNY to prepare its functional statements.
4.3 Business combination
A business combination is a transaction or event that brings together two or more separate entities into one reporting entity. Business combinations
are classified into business combinations involving enterprises under common control and business combinations not involving enterprises under
common control.
(1) Business combination involving entities under common control
A business combination involving enterprises under common control is a business combination in which all of the combining enterprises are
ultimately controlled by the same party or parties both before and after the combination, and that control is not transitory.
For a business combination involving enterprises under common control, the party that, on the combination date, obtains control of another
enterprise participating in the combination is the absorbing party, while that other enterprise participating in the combination is a party being
absorbed. Combination date is the date on which the absorbing party effectively obtains control of the party being absorbed.
The assets and liabilities obtained are measured at the carrying amounts as recorded by the enterprise being combined at the combination date.
The difference between the carrying amount of the net assets obtained and the carrying amount of consideration paid for the combination (or the
total face value of shares issued) is adjusted to the capital premium (or share premium) in the capital reserve. If the balance of the capital premium
(or share premium) is insufficient, any excess is adjusted to retained earnings.
The cost of a combination incurred by the absorbing party includes any costs directly attributable to the combination shall be recognized as an
expense through profit or loss for the current period when incurred.
(2) Business combination involving entities not under common control
A business combination involving enterprises not under common control is a business combination in which all of the combining enterprises are not
ultimately controlled by the same party or parties both before and after the business combination.
For a business combination not involving enterprises under common control, the party that, on the acquisition date, obtains control of another
enterprise participating in the combination is the acquirer, while that other enterprise participating in the combination is the acquiree. Acquisition
date is the date on which the acquirer effectively obtains control of the acquiree.
For a business combination not involving enterprise under common control, the combination cost including the sum of fair value, at the acquisition
date, of the assets given, liabilities incurred or assumed, and equity securities issued by the acquirer. The intermediary expenses incurred by the
acquirer in respect of auditing, legal services, valuation and consultancy services etc and other associated administrative expenses attributable to
the business combination are recognized in profit or loss when they are incurred.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The transaction cost arose from issuing of equity securities or liability securities shall be initially recognized as equity securities or liability securities.
The contingent consideration related to the combination shall be booked as combination cost at the fair value at the acquisition date. If, within the 12
months after acquisition, additional information can prove the existence of related information at acquisition date and the contingent consideration
need to be adjusted, goodwill can be offset.
For a business combination achieved in stages that involves multiple exchange transactions, the equity interest in the acquiree previously held
before the acquisition date re-assessed at the fair value at the acquisition date, with any difference between its fair value and its carrying amount is
recorded as investment income. The other comprehensive income of the acquiree before the acquisition date relating to the previously held interest
in the acquiree is transferred to investment income.
Combination cost is the aggregate of the carrying amount of the equity interest held in the acquiree prior to the acquisition date and the fair value of
the cost of the additional investment at the acquisition date.
Combination cost of the acquirer’s interest and identifiable net assets of the acquirer acquired through the business combination shall be measured
by the fair value at the acquisition date. Where the cost of combination exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable
net assets, the difference shall be recognized as goodwill. Where the cost of combination is less than the acquirer’s interest in the fair value of the
acquiree’s identifiable net assets, the difference shall be accounted for according to the following requirements: (i) the acquirer shall reassess the
measurement of the fair values of the acquiree’s identifiable assets, liabilities and contingent liabilities and measurement of the cost of combination;
(ii) if after that reassessment, the cost of combination is still less than the acquirer’s interest in the fair values of the acquiree’s identifiable net
assets, the acquirer shall recognize the remaining difference immediately in profit or loss for the current period.
Where the temporary difference obtained by the acquirer was not recognized due to inconformity with the conditions applied for recognition of
deferred income tax, if, within the 12 months after acquisition, additional information can prove the existence of related information at acquisition
date and the expected economic benefits on the acquisition date arose from deductible temporary difference by the acquiree can be achieved,
relevant income tax assets can be recognized, and goodwill offset. If the goodwill is not sufficient, the difference shall be recognized as profit of the
current period.
Apart from above, the differences shall be taken into profit or loss of the current period if the recognition of deferred income tax assets is related to
the combination.
4.4 Preparation of the consolidated financial statements
(1) The scope of consolidation
The scope of consolidation for the consolidated financial statements is determined on the basis of control. Control is the power to govern the
financial and operating policies of an enterprise so as to obtain benefits from its operating activities. The scope of consolidation includes the
Company and all of the subsidiaries. Subsidiary is an enterprise or entity under the control of the Company.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
(2) Preparation of the consolidated financial statements
The subsidiary of the Company is included in the consolidated financial statements from the date when the control over the net assets and business
decisions of the subsidiary is effectively obtained, and excluded from the date when the control ceases.
For a subsidiary disposed of by the Company, the operating results and cash flows before the date of disposal (the date when control is lost) are
included in the consolidated income statement and consolidated statement of cash flows, as appropriate. For a subsidiary disposed during the
period, no adjustment is made to the opening balance of the consolidated financial statements.
For a subsidiary acquired through a business combination not under common control, the operating results and cash flows from the acquisition (the
date when the control is obtained) are included in the consolidated income statement and consolidated statement of cash flows, as appropriated; no
adjustment is made to the opening balance and comparative figures in the consolidated financial statements.
Where a subsidiary was acquired during the reporting period, through a business combination involving enterprises under common control, the
financial statements of the subsidiary are included in the consolidated financial statements. The results of operations and cash flow are included in
the consolidated balance sheet and the consolidated income statement, respectively, based on their carrying amounts, from the date that common
control was established, and the opening balances and the comparative figures of the consolidated financial statements are restated.
When the accounting period or accounting policies of a subsidiary are different from those of the Company, the Company makes necessary
adjustments to the financial statements of the subsidiary based on the Company’s own accounting period or accounting policies. Where a subsidiary
was acquired during the reporting period through a business combination not under common control, the financial statements was reconciliated on
the basis of the fair value of identifiable net assets at the date of acquisition. Intra-Group balances and transactions, and any unrealized profit or loss
arising from intra-Group transactions, are eliminated in preparing the consolidated financial statements.
Minority interest and the portion in the net profit or loss not attributable to the Company are presented separately in the consolidated balance sheet
within shareholders’/ owners’ equity and net profit. Net profit or loss attributable to minority shareholders in the subsidiaries is presented separately
as minority interest in the consolidated income statement below the net profit line item.
When the amount of loss for the current period attributable to the minority shareholders of a subsidiary exceeds the minority shareholders’ portion of
the opening balance of [shareholders’] [owners’] equity of the subsidiary, the excess is allocated against the minority interests.
When the Company loses control of a subsidiary due to the disposal of a portion of an equity investment or other reasons, the remaining equity
investment is re-measured at its fair value at the date when control is lost. The difference between 1) the total amount of consideration received
from the transaction that resulted in the loss of control and the fair value of the remaining equity investment and 2) the carrying amounts of the
interest in the former subsidiary’s net assets immediately before the loss of the control is recognized as investment income for the current period
when control is lost. The amount recognized in other comprehensive income in relation to the former subsidiary’s equity investment is reclassified as
investment income for the current period when control is lost. The retained interest is subsequently measured according to the rules stipulated in the
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- “Chinese Accounting Standards for Business Enterprises No.2 - Long-term equity investment” or “Chinese Accounting Standards for Business
Enterprises No.22 - Determination and measurement of financial instruments”. See Note 4.10 Long-term equity investments and Note 4.7 Financial
instruments for details.
4.5 Cash equivalent
Cash and cash equivalents of the Company include cash on hand, ready usable deposits and investments having short holding term (normally will
be due within three months from the day of purchase), with strong liquidity and easy to be exchanged into certain amount of cash that can be
measured reliably and have low risks of change.
4.6 Foreign exchange
(1) Translation in foreign exchange transactions
The foreign currency transactions are recorded, on initial recognition in the functional currency, by applying [the spot exchange rate on the date of
the transaction / an exchange rate that approximates the actual spot exchange rate on the date of transaction]. The exchange of foreign currency
and transactions related to the foreign exchange are translated at the spot exchange rate.
(2) Translation of monetary foreign currency and non-monetary foreign currency
At the balance sheet date, foreign currency monetary items are translated using the spot exchange rate at the balance sheet date. All the exchange
differences thus resulted are taken to profit or loss, except for ① those relating to foreign currency borrowings specifically for construction and
acquisition of qualifying assets, which are capitalized in accordance with the principle of capitalization of borrowing costs; ② hedging accounting,
the exchange difference related to hedging instruments for the purpose of net oversea operating investment is recorded in the comprehensive
income till the date of disposal and recognized in profit or loss of the period; exchange difference from changes of other account balance of foreign
currency monetary items, ③ available-for-trade is recorded into profit or loss except for amortized cost.
Non-monetary foreign currency items measured at historical cost shall still be translated at the spot exchange rate prevailing on the transaction date,
and the amount denominated in the functional currency is not changed. Non-monetary foreign currency items measured at fair value are translated
at the spot exchange rate prevailing at the date when the fair values are determined. The exchange difference thus resulted are recognized in profit
or loss for the current period or as capital reserve.
(3) The translation of financial statement in foreign currency
When the consolidated financial statements include foreign operation(s), if there is a foreign currency monetary item constituting a net investment in
a foreign operation, exchange difference arising from changes in exchange rates are recognized as “exchange differences arising on translation of
financial statements denominated in foreign currencies” in owner’s equity, and in profit or loss for the period upon disposal of the foreign operation.
The Group translates the financial statements of its foreign operations into CNY by following rules. Assets and liabilities in the balance sheet are
translated at the spot exchange rate prevailing at the balance sheet date; all equity items except for retained earnings are translated at the spot
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exchange rates at the dates on which such items occur; income and expenses in income statement are translated at the spot exchange rates at the
date of transaction; the opening retained earnings is the closing retained earnings of the last period after translation; the closing balance of retained
earnings is calculates and presented in the basis of each translated income statements and profit distribution item; the difference arising between
the assets and liabilities and shareholders’ equity shall be booked as translation difference of foreign currency statements, and shall be presented
as a separate component of equity in the balance sheet. On a loss of control over Group’s oversea operation due to disposal, the Company
transfers the accumulated or proportionate share of the accumulated exchange difference arising on translation of financial statements of this
oversea operation attributable to the owners’ equity of the Company and presented under shareholders’ equity, to profit or loss in the period in which
the disposal occurs.
Foreign currency cash flows and cash flow of oversea subsidiaries are translated at the spot exchange rates on the date of cash flows.The effect of
exchange rate changes on cash is separately presented as an adjustment item in the cash flow statement.
The opening and actual amount of last year are presented in the financial statement after translation.
4.7 Financial instruments
(1) Determination of financial assets and liabilities’ fair value
Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length
transaction. For a financial instrument which has an active market, the Company uses quoted price in the active market to establish its fair value.
The quoted price in the active market refers to the price that can be regularly obtained from exchange market, agencies, industry associations,
pricing authorities; it represents the fair market trading price in the actual transaction.
For a financial instrument which does not have an active market, the Company establishes fair value by using a valuation technique. Valuation
techniques include using recent arm’s length market transactions between knowledgeable, willing parties, reference to the current fair value of
another instrument that is substantially the same, discounted cash flow analysis and option pricing models.
The Company measures initially and subsequently the fair value of an interest rate swap at the value of a competitor’s interest rate swap quoted by
a recognised financial institution as at the Company’s balance sheet date in accordance with the principle of consistency.
(2) Classification, recognition and measurement of financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. On initial recognition, the Company’s
financial assets are classified into one of the four categories, including financial assets at fair value though profit or loss, held-to maturity
investments, loans and receivables and available-for-trade financial assets. A financial asset is recognized initially at fair value. In the case of
financial assets at fair value through profit or loss, relevant transaction costs are immediately charged to the profit and loss of the current period;
transaction costs relating to financial assets of other categories are included in the amount initially recognized.
1) Financial assets at fair value through profit or loss:
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Including financial assets held-for-trade and financial assets designated at fair value through profit or loss.
Financial asset held-for-trade is the financial asset that meets one of the following conditions:
A. the financial asset is acquired for the purpose of selling it in a short term;
B. the financial asset is a part of a portfolio of identifiable financial instruments that are collectively managed, and there is objective evidence
indicating that the enterprise recently manages this portfolio for the purpose of short-term profits;
C. the financial asset is a derivative, except for a derivative that is designated and effective hedging instrument, or a financial guarantee contract, or
a derivative that is linked to and must be settled by delivery of an unquoted equity instrument (without a quoted price from an active market) whose
fair value cannot be reliably measured. For such kind of financial assets, fair values are adopted for subsequent measurement.
Financial asset is designated on initial recognition as at fair value through profit or loss only when it meets one of the following conditions:
A. the designation eliminates or significantly reduces the inconsistency in the measurement or recognition of relevant gains or losses that would
otherwise arise from measuring the financial instruments on different bases.
B. a Group of financial instruments is managed and its performance is evaluated on a fair value basis, and is reported to the enterprise’s key
management personnels. Formal documentation regarding risk management or investment strategy has prepared.
Financial assets at fair value through profit or loss are subsequently measured at the fair value. Any gains or losses arising from changes in the fair
value and any dividends or interest income earned on the financial assets are recognized in the profit or loss.
2) Investment held-to maturity
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that an entity has the
positive intention and ability to hold to maturity. Such kind of financial assets are subsequently measured at amortized cost using the effective
interest method. Gains or losses arising from derecognition, impairment or amortization are recognized in profit or loss for the current period.
Effective interest rate is the rate that exactly discounted estimated future cash flows through the expected life of the financial asset or financial
liability or, where appropriate, a shorter period to the net carrying amount of the financial asset or financial liability.
When calculating the effective interest rate, the Company shall estimate future cash flow considering all contractual terms of the financial asset or
financial liability without considering future credit losses, and also consider all fees paid or received between the parties to the contract giving rise to
the financial asset and financial liability that are an integral part of the effective interest rate, transaction costs, and premiums or discounts, etc.
3) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed determinable payment that are not quoted in an active market. Financial assets
classified as loans and receivables by the Company include note receivables, account receivables, interest receivable dividends receivable and
other receivables.
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Loans and receivables are subsequently measured at amortized cost using the effective interest method. Gain or loss arising from derecognition,
impairment or amortization is recognized in profit or loss.
4) Financial assets available-for-trade
Financial assets available-for-trade include non-derivative financial assets that are designated on initial recognition as available for trade, and
financial assets that are not classified as financial assets at fair value through profit or loss, loans and receivables or investment held-to-maturity.
Financial assets available-for-trade are subsequently measured at fair value, and gains or losses arising from changes in the fair value are
recognized as other comprehensive income and included in the capital reserve, except that impairment losses and exchange differences related to
amortized cost of monetary financial assets denominated in foreign currencies are recognized in profit or loss, until the financial assets are
derecognized, at which time the gains or losses are released and recognized in profit or loss.
Interests obtained and dividends declared by the investee during the period in which the financial assets available-for-trade are held, are recognized
in investment gains.
(3) Impairment of financial assets
The Group assesses at the balance sheet date the carrying amount of every financial asset except for the financial assets that measured by the fair
value. If there is objective evidence indicating a financial asset may be impaired, a provision is provided for the impairment.
1) Impairment on held-to maturity investment, loans and receivables
The financial assets measured by cost or amortized cost write down their carrying value by the estimated present value of future cash flow. The
difference is recorded as impairment loss. If there is objective evidence to indicate the recovery of value of financial assets after impairment, and it is
related with subsequent event after recognition of loss, the impairment loss recorded originally can be reversed. The carrying value of financial
assets after impairment loss reversed shall not exceed the amortized cost of the financial assets without provisions of impairment loss on the
reserving date.
2) Impairment loss on available-for-trade financial assets
Where the fair value of the equity instrument investment drops significantly or not contemporarily according to the integrated relevant factors, an
available-for-trade financial asset is impaired.
When an available-for-trade financial asset is impaired, the cumulative loss arising from declining in fair value that had been recognized in capital
reserve shall be removed and recognized in profit or loss. The amount of the cumulative loss that is removed shall be difference between the
acquisition cost with deduction of recoverable amount less amortized cost, current fair value and any impairment loss on that financial asset
previously recognized in profit or loss.
If, after an impairment loss has been recognized, there is objective evidence that the value of the financial asset is recovered, and it is objectively
related to an event occurring after the impairment loss was recognized, the initial impairment loss can be reversed and the reserved impairment loss
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on available-for-trade equity instrument is recorded in the profit or loss, the reserved impairment loss on available-for-trade debt instrument is
recorded in the current profit or loss.
The equity instrument where there is no quoted price in an active market, and whose fair value cannot be reliably measured, or impairment loss on a
derivative asset that is linked to and must be settled by delivery of such an unquoted equity instrument shall not be reversed.
(4) Recognition and measurement of financial assets transfer
The Group derecognizes a financial asset when one of the following conditions is met:
1) the rights to receive cash flows from the asset have expired;
2) the enterprise has transferred its rights to receive cash flows from the asset to a third party under a pass-through arrangement; or
3) the enterprise has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards
of the asset, or (b) has neither transferred nor
retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
If the enterprise has neither retained all the risks and rewards from the financial asset nor control over the asset, the asset is recognized according
to the extent it exists as financial asset, and correspondent liability is recognized. The extent of existence refers the level of risk by the financial
asset changes the enterprise is facing.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, (a). the carrying amount of the financial asset transferred; and
(b) the sum of the consideration received from the transfer and any cumulative gain or loss that had been recognized in other comprehensive
income, is recognized in profit or loss.
If a part of the transferred financial asset qualifies for derecognition, the carrying amount of the transferred financial asset is allocated between the
part that continues to be recognized and the part that is derecognized, based on the relative fair value of those parts. The difference between (a) the
carrying amount allocated to the part derecognized; and (b) the sum of the consideration received for the part derecognized and any cumulative
gain or loss allocated to the part derecognized which has been previously recognized in other comprehensive income, is recognized in profit or loss.
(5) Classification and measurement of financial liabilities
The Group’s financial liabilities are, on initial recognition, classified into financial liabilities at fair value through profit or loss and other financial
liabilities. For financial liabilities at fair value through profit or loss, relevant transaction costs are immediately recognized in profit or loss for the
current period, and transaction costs relating to other financial liabilities are included in the initial recognition amounts.
1) Financial liabilities measured by the fair value and the changes recorded in profit or loss
The classification by which financial liabilities held-for-trade and financial liabilities designed at the initial recognition to be measured by the fair value
follows the same criteria as the classification by which financial assets held-for-trade and financial assets designed at the initial recognition to be
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measured by the fair value and their changes are recorded in the current profit or loss.
For the financial liabilities measured by the fair value and changes recorded in the profit or loss, fair values are adopted for subsequent
measurement. All the gains or losses on the change of fair value and the expenses on dividends or interests related to these financial liabilities are
recognized in profit or loss for the current period.
2) Other financial liabilities
Derivative financial liabilities that linked with equity instruments, which do not have a quoted price in an active market and their fair value cannot be
measured reliably, is subsequently measured by cost Other financial liabilities are subsequently measured at amortized cost using the effective
interest method. Gains or losses arising from derecognition or amortization are recognized in profit or loss for the current period.
(6) Derecognition
The Group derecognizes a financial liability (or part of it) when the underlying present obligation (or part of it) is discharged or cancelled or has
expired. An agreement between the Company (an existing borrower) and existing lender to replace original financial liability with a new financial
liability with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new liability.
When the Company derecognizes a financial liability or a part of it, it recognizes the difference between the carrying amount of the financial liability
(or part of the financial liability) derecognized the consideration paid (including any non-cash assets transferred or new financial liabilities assumed)
in profit or loss.
(7) Derivatives and embedded derivatives
Derivative financial instruments include derivatives are initially measured at fair value at the date when the derivative contracts are entered into and
are substantially re-measured at fair value. The resulting gain and loss is recognized in profit or loss.
An embedded derivative is separated from the hybrid instrument, where the hybrid instrument is not designated as a financial asset or financial
liability at fair value though profit or loss, and the treated as a standalone derivative if (a) the economic characteristics and risks of the embedded
derivative are not closely related to the economic characteristics and risks of the host contract; and (b) a separate instrument with the same terms
as the embedded derivative would meet the definition of a derivative. If the Company is unable to measure the embedded derivative separately
either at acquisition or at a subsequent balance sheet date, it designates the entire hybrid instrument as a financial asset or financial liability at fair
value through profit or loss.
(8) Offsetting financial assets and financial liabilities
When the Company has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities, and intends either
to settle on a net basis, or to realize the financial asset and settle the financial liability simultaneously, a financial asset and a financial liability shall
be offset and the net amount is presented in the balance sheet. Except for the above circumstances, financial assets and financial liabilities shall be
presented separately in the balance sheet and shall not be offset.
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(9) Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. The
consideration received from issuing equity instruments, net of transaction costs, are added to shareholders’ equity. All types of distribution
(excluding stock dividends) made by the Company to holders of equity instruments are deducted from shareholders’ equity. The Group does not
recognize any changes in the fair value of equity instruments.
4.8 Accounts receivable
The receivables by the Company includes account receivables, and other receivables.
(1) Criteria for recognition of bad debts:
The Company carries out an inspection on the balance sheet date. Where there is any objective evidence proving that the receivables have been
impaired, an impairment provision shall be made:
1) A serious financial difficulty occurs to the issuer or debtor;
2) The debtor breaches any of the contractual stipulations, for example, fails to pay or delays the payment of interests or the principal, etc.;
3) The debtor will probably become bankrupt or carry out other financial reorganizations;
4) Other objective evidences showing the impairment of the receivables.
(2) Method for bad debts provision
1) Provisions of bad debts in account receivables that is individually significant.
Individual receivables equal to or higher than 5% of total receivables are classified as receivables of individual significance.
For an account receivable that is individually significant, the asset is individually assessed for impairment, the impairment loss is recognized at the
difference between the present value of future cash flow less the carrying amount, and provision is made accordingly.
2) Provisions of bad debts in account receivables that individually insignificant items with similar credit risk characteristics that have significant risk:
A. Evidence of credit risk characteristics
Whether the financial asset is individually significant or not individually significant, it is included in a group of financial assets with similar credit risk
characteristics and collectively assessed for impairment. Such credit risk reflects the repayment of all due amount under the contract, and is related
to the estimation of future cash flow expected to be derived from the assets.
Evidence of portfolios：
Item Basis
Age portfolios Age
Related party portfolios The companies which are in the scope of the consolidation.
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B. Provision by credit risk characteristics
During the Company impairment test, the amount of bad debts provisions is determined by the assessed result from the experience of historical loss
and current economic status and the existing loss in the estimated account receivables according to the set of account receivables and credit risk
characteristic.
Provision for different portfolios:
Item Provision
Age portfolios Age analysis method
Related party portfolios No allowance for bad debt
a. Portfolio by age analysis
Percentage of carrying amount for recognition Percentage of carrying amount for
Category of allowance for bad debt applicable to recognition of allowance for bad debt
accounts receivable applicable to other receivable
Less than 1 year (inclusive, same applies to the
following)
Including: 1 to 6 months 1.00 1.00
7 to 12 months 5.00 5.00
1 to 2 years 10.00 10.00
2 to 3 years 50.00 50.00
Over 2 years 100.00 100.00
3) Provisions of bad debts that is individually insignificant.
For the account receivables not individually significant, the Company assesses the account receivables individually for impairment when are of
following characteristics: if there is objective evidence indicating the impairment, the impairment loss is recognized at the difference between the
present value of future cash flow less the carrying amount, and provision is made accordingly. For examples: receivables of individual insignificance
bears differing credit risk characteristics to other receivables of individual insignificance account receivables with related parties; account
receivables under litigations or arbitrations, or account receivables with obvious indication that debtor cannot fulfill the obligation of repayment.
(3) The reversal of bad debts provision
If there is objective evidence of recovery in value of account receivables, and the recovery can be related to an event occurring after the impairment
was recognized, the previously recognized impairment loss is reversed and recognized in profit or loss. However, the reversal shall not result in a
carrying amount that exceeds what the amortized cost would have been had the impairment loss not been recognized at the date the impairment is
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reversed.
4.9 Inventories
(1) Classification of inventory
The Company’s inventory mainly include air materials and low-value consumables.
(2) Valuation method of inventories
Inventories are initially carried at the actual cost. Cost of inventories include purchase cost, conversion cost and other cost. Cost of issue is
measured using the weighted average method.
(3) Basis for determining net realizable value of inventories and provision methods for decline in value of inventories
Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion, the estimated costs
necessary to make the sale and relevant taxes. Net realizable value is determined on the basis of clear evidence obtained, and takes into
consideration the purpose of holding inventories and effect of post balance sheet events.
At the balance sheet date, inventories are measured at the lower of the cost and net realizable value. If the net realizable value is below the cost of
inventories, a provision for decline in value of inventories is made. The provision for inventories decline in value is determined normally by the
difference of the cost of individual item less its realizable value. For large quantity and low value items of inventories,
provision for decline in value is made based on categories of inventories. For items of inventories relating to a product line that are produced and
marketed in the same geographical area, have the same or similar end users or purposes, and cannot be practicably evaluated separately from
other items in that product line provision for decline in value is determined on an aggregate basis.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories to be written down below cost
no longer exist so that the net realizable value of inventories is higher than their cost, the original provision for decline in value is reversed and the
reversal is included in profit or loss for the period.
(4) The perpetual inventory system is maintained for stock system.
(5) Amortization method for low cost and short-lived consumable items and packaging materials.
Low cost and short-lived consumable items are amortized using immediate write-off method; packaging materials are amortized using immediate
write-off method.
4.10 Long-term equity investments
(1) Determination of Investment cost
For a business combination involving enterprises under common control, the initial investment cost of the long-term equity investment shall be
carrying value of the absorbing party’s share of the shareholder’s equity of the party being absorbed at the date of combination.
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For a business combination not involving enterprise under common control, the combination cost including the sum of fair value, at the acquisition
date, of the assets given, liabilities incurred or assumed, and equity securities issued by the acquirer. The intermediary expenses incurred by the
acquirer in respect of auditing, legal services, valuation and consultancy services etc and other associated administrative expenses attributable to
the business combination are recognized in profit or loss when they are incurred.
The transaction cost for the equity securities or liability securities issued by the acquirer in the business combination shall be recognized as initial
amount of equity security or liability.
The equity investments other than the long-term equity through combination shall be initially measured by cost. The cost shall be recognized to the
difference in the way of acquisition of long-term equity investment. Theses ways include the cash purchase price the Companythe Company actually
paid, the fair value of equity security issued by the Companythe Company, value specified in the investment contract or agreement, the fair value or
carrying value of the asset out in the transaction of non-monetary asset exchanges, and the fair value of the long-term equity investment.
Expenses, taxes and other necessary expenditures directly attributable to the acquisition of long-term equity investment are taken into investment
cost.
(2) Subsequent Measurement
Cost method shall be adopted in a long-term equity investment where the investing enterprise does not have common control or significant influence
over the investee, the investment is not quoted in an active market and its fair value cannot be measured reliably.
Where an investing enterprise can exercise common control or significant influence over the investee,
a long-term investment shall be accounted for using the equity method.
When an investing enterprise can no longer exercise joint control or common control nor significant influence over the investee, and its fair value
cannot be measured reliably, a long-term investment shall be counted as financial asset ready-for trade.
A long-term equity investment where cost method is adopted in the Company’s financial statements
can exercise controls over the investee.
1) Cost method of accounting for long-term equity investments
Under the cost method, a long-term equity investment is measured at initial investment cost. Except for cash dividends or profits declared but not
yet paid that are included in the price or consideration actually paid upon acquisition of the long-term equity investment, investment income is
recognized in the period in accordance with the attributable share of cash dividends or profit distributions declared by the investee.
2) Equity method of accounting for long-term equity investments
Where the initial investment cost of a long-term equity investment exceeds the investing enterprise’s interest in the fair values of the investee’s
identifiable net assets at the time of acquisition, no adjustment shall be made to the initial investment cost.
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Where the initial investment cost of a long-term equity investment is less than the investing enterprise’s interest in the fair values of investee’s
identifiable net assets at the time of acquisition, the difference shall be charged to profit or loss for the current period, and the cost of the long-term
equity investment shall adjusted accordingly.
Under the equity method, the Company recognizes its share of the net profit or loss of the investee for the period as investment income or loss for
the period. The Group recognizes it share of the investee’s net profit or loss based on the fair value of the investee’s individual separately indentible
assets, etc at the acquisition date after making appropriate adjustments to confirm with the Company’s accounting policies and accounting period.
Unrealized profits or losses resulting from the Company’s transactions with its associates and joint ventures are recognized as investment income or
loss to the extent that those attributable to the Company’s equity interest are eliminated. However, unrealized losses resulting from the Company’s
transactions with its investees on the transferred assets, in accordance with "Accounting Standards for Enterprises No. 8 - Impairment of Assets",
are not eliminated. Changes in owners’ equity of the investee other than net profit or loss are correspondingly adjusted to the carrying amount of the
long-term equity investment, and recognized as other compressive income which is included in the capital reserve.
When the investee is recognized net losses, reduce the carrying value of long-term equity investments and long-term equity of net investment (in
substance) in investee to zero. In addition, the Company has the obligations on additional losses, then the expected obligation as estimated
liabilities and included in the current investment losses. Where the net profit from investee units, restoration confirm the amount of revenue sharing
after offset the amount of unrecognized loss sharing.
For long-term equity investments in associates and joint ventures which had been held by the Company before its first time adoption of Accounting
Standards for Business Enterprises, where the initial investment cost of a long-term equity investment exceeds the Company’s interest in the
investee’s net assets at the time of acquisition, the excess is amortized and is recognized in profit or loss on a straight line basis over the original
remaining life.
3) Acquisition of minority interest
The difference between newly increased equity investment due to acquisition of minority interests and portion of net asset cumulatively calculated
from the acquisition date is adjusted as capital reserve. If the capital reserve is not sufficient to absorb the difference, the excess are adjusted
against returned earnings.
4) Disposal of long-term equity investment
Where the parent company disposes long-term investment in a subsidiary without a change in control, the difference in the net asset between the
amount of disposed long-term investment and the amount of the consideration paid or received is adjusted to the owner’s equity. If the disposal of
long-term investment in a subsidiary involves loss of control over the subsidiary, the related accounting policies in Note 4.2(2) applies.
On disposal of a long-term equity investment, the difference between the proceeds actually received and receivable and the carrying amount is
recognized in profit or loss for the period. For along-term equity investment accounted for using the equity method, the amount included in the
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owners’ equity attributable to the percentage interest disposed is transferred to profit or loss for the period.
For any retained interest, it shall be subsequently measured according to the related accounting policies in regard of long-term equity investments or
financial assets as described above if its carrying amount is recognized as long-term equity investments or other related financial assets.
Retroactive adjustment is made on the basis of relevant policies if the retained interests are settled from cost method to equity method.
(3) Recognition of investee under common control or significant influence
Control is the power to govern the financial and operating policies of an enterprise so as to obtain benefits from its operating activities.
Common control is the contractually agreed sharing of control over an economic activity, and exists only when the strategic financial and operating
decisions relating to the activity require the unanimous consent of the parties sharing control.
Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over
those policies.
When determining whether an investing enterprise is able to exercise control or significant influence over an investee, the effect of potential voting
rights of the investee held be the investing enterprise or other parties that are currently exercisable or convertible shall be considered.
(4) Impairment testing methods and recognition of impairment provision
The company assesses the long-term equity investment at the balance sheet date whether there is any indication of impairment. If any indication
exists that an asset may be impaired, the enterprise shall
estimate its recoverable value of the asset. If the recoverable value of the asset is less than its carrying amount, a provision for impairment loss of
the asset is recognized accordingly.
Once an impairment loss is recognized, it shall not be reversed in a subsequent period.
4.11 Investment property
Investment property is held to earn rentals or for capital appreciation or for both. Investment property includes leased or ready to transfer after
capital appreciation land use rights and leased buildings. Investment property is initially measured at cost. Subsequent expenditures related to an
investment real estate are likely to flow about the economic benefits of the asset and its cost can be measured reliably , is included in the cost of
investment real estate. Other subsequent expenditure in the profit or loss when incurred .
The Group uses the cost model for subsequent measurement of investment property, and in accordance with the depreciation or amortization of
buildings or land use rights policy.
Investment property impairment test method and impairment accrual method described in Note 17 “Non-current and non-financial assets impairment
".
Occupied real estate for investment property or investment property is transferred to owner-occupied real estate or stock conversion as the recorded
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value after the conversion, according to the book value before the conversion.
Investment property change into the Owner-occupied real estate , since the change of date for the investment property is transferred to fixed assets
or intangible assets. Change the owner-occupied property held to earn rentals or for capital appreciation, since the change of date, the fixed assets
or intangible assets to investment property. Conversion occurs when converted to investment property using the cost model, as the book value
before the conversion of the recorded value after the conversion; converted to investment property measured at fair value model, the fair value of
the conversion date as the recorded value after conversion.
Derecognised when the investment property is disposed of or permanently withdrawn from use and the expected economic benefits can not be
obtained from the disposal of investment property. Proceeds on disposal of investment property is sold, transferred, retired or damaged through
profit or loss after deducting the book value and related taxes.
4.12 Fixed assets
(1) The conditions of recognition
Fixed assets refers to the tangible assets that are held for the sake of producing commodities, rendering labor service, renting or business
management and their useful life is in excess of one fiscal year.
(2) The method for depreciation
Fixed assets are stated at cost and consider the impact of expected costs of abandoning the initial measurement. From the following month of state
of intended use, depreciation method of the straight-line method is used for different categories of fixed assets to take depreciation. The
recognition of the classification, useful life and estimated residual rate are as follows:
Category Expected useful life Estimated residual value(%) Depreciation(%)
Houses and building 8-35 3-5 2.7-12.1
Machineries 8-10 3-5 9.5-12.1
Vehicles 4 3 24.25
Administrative equipments and others 3 3 32.33
Expected net residual value of fixed assets is the balance of the Company currently obtained from the disposal of the asset less the estimated costs
of disposal amount, assuming the asset is out of useful life and state the expected service life in the end.
(3) Measurement and recognition of fixed assets impairment
Impairment and provisions of fixed assets are disclosed on Note 4.17 Impairment of non-current and non-financial assets.
(4) Fixed Assets under finance leases
A finance lease is a lease that transfers in substance all the risks and rewards incident to ownership of an asset. Title may or may not eventually be
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transferred.
Fixed assets that are held under finance leases shall be depreciated by applying the same policy as that for the fixed assets owned by the Company.
If it can be reasonably determined that the ownership of the leased assets can be obtained at the end of the lease period, the leased assets are
depreciated over their useful lives; otherwise, the leased assets are depreciated over the shorter of the lease terms and the useful lives of the
leased assets.
(5) Others
A fixed asset is recognized only when the economic benefits associated with the asset will probably flow to the Company and the cost of the asset
can be measured reliably. Subsequent expenditure incurred for a fixed asset that meet the recognition criteria shall be included in the cost of the
fixed asset, and the carrying amount of the component of the fixed asset that is replaced shall be derecognized. Otherwise, such expenditure shall
be recognized in profit or loss in the period in which they are incurred.
The revenue from selling or transferring, or disposing a fixed asset is booked into profit and loss after deduction of carrying value and related tax.
The Company conducts a review of useful life, expected net realizable value and depreciation methods of the fixed asset at least on an annual base.
Any change is regarded as change in accounting estimates.
4.13 Construction in progress
Construction in progress is measured at its actual cost. The actual costs include various construction expenditures during the construction period,
borrowing costs capitalized before it is ready for intended use and other relevant costs. Construction in progress is transferred to a fixed asset when
it is ready for intended use.
Testing method for provision impairment of construction in progress and accrued method for provision impairment please refer to Note 4.17.
4.14 Borrowing costs
Borrowing costs include interest, amortization of discounts or premiums related to borrowings, ancillary costs incurred in connection with the
arrangement of borrowings, and exchange differences arising from foreign currency borrowings.
The borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized. The amounts of
other borrowing costs incurred are recognized as an expense in the period in which they are incurred. Qualifying assets are asset (fixed assets,
investment property and inventories, etc.) that necessarily take a substantial period of time for acquisition, construction or production to get ready for
their intended use or sale.
Where funds are borrowed for a specific-purpose, the amount of interest to be capitalized is the actual interest expense incurred on that borrowing
for the period less any bank interest earned from depositing the borrowed funds before being used on the asset or any investment income on the
temporary investment of those funds.
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Where funds are borrowed for a general-purpose, the amount of interest to be capitalized on such borrowings is determined by applying a weighted
average interest rate to the weighted average of the excess amounts of accumulated expenditure on the asset over and above the amounts of
specific-purpose borrowings.
During the capitalization period, exchange differences related to a specific-purpose borrowing
denominating in foreign currency are all capitalized. Exchange differences in connection with general-purpose borrowings are recognized in profit or
loss in the period in which they are incurred.
Assets qualified for capitalization are the fixed assets, investment properties or inventories which need a long time of construction or production
activities before ready for intended used or sale.
Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or production of a qualifying asset is interrupted
by activities other than those necessary to prepare the asset for its intended use or sale, when the interruption is for a continuous period of more
than 3 months. Borrowing costs incurred during these periods recognized as an expense for the current period until the acquisition, construction or
production is resumed.
4.15 Intangible assets
(1) Intangible asset
The term “intangible asset” refers to the identifiable non-monetary assets without physical shape, possessed or controlled by enterprises.
The intangible assets are initially measured by its cost. Expenses related to intangible assets, if the economic benefits related to intangible assets
are likely to flow into the enterprise and the cost of intangible assets can be measured reliably, shall be recorded as cost of intangible assets. The
expenses other than this shall be booked in the profit or loss when they occur.
Land use rights that are purchased by the Company are accounted for as intangible assets. Buildings, such as plants that are developed and
constructed by the Company, and relevant land use rights and buildings, are accounted for as intangible assets and fixed assets, respectively.
Payments for the land and buildings purchased are allocated between the land use rights and the buildings; if they cannot be reasonably allocated,
all of the land use rights and buildings are accounted for as fixed assets.
When an intangible asset with a definite useful life is available for use, its original cost less net residual value and any accumulate impairment
losses is amortized over its estimated useful life using the straight-line method. An intangible asset with an indefinite useful life is not amortized.
For an intangible asset with a definite useful life, the Company reviews the useful life and amortization method at the end of the period, and makes
adjustment when necessary.. An additional review is also carried out for useful life of the intangible assets with indefinite useful life. If there is
evidence showing the foreseeable limit period of economic benefits generated to the enterprise by the intangible assets, then estimate its useful life
and amortize according to the policy of intangible assets with definite useful life.
(2) Research and development cost
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Cost of research and development is distinguished into the research phase and the development phases.
Cost of the research phase is recognised in the profit or loss in the period in which it is incurred.
Unless the following conditions are satisfied, cost of the development phase is recognised in the profit or loss in the period in which it is incurred:
1) it is technically feasible to complete the intangible asset so as to use it or sell it;
2) it is clearly invented to complete the intangible asset in order to use it or sell it;
3) it is probable that the intangible asset is capable of generating future economic benefit, such as the market for the product produced by the
intangible asset or the intangible asset itself, it is objectively evidential that the intangible asset is economically usable if it is going to be used
internally;
4) there are sufficient technical, financial and other resources to complete the intangible asset and to use it or sell it;
5) the cost of the development of the intangible can be measured reliably.
If the cost cannot be distinguished into the search phase and the development phase, it is recognised in the profit or loss for the period in which it is
incurred.
(3) Impairment of intangible assets
Impairment and provisions of intangible assets are disclosed on Note 4.17.
4.16 Long-term deferred expenditure
An item long-term deferred expenses is an expense which has been incurred and which has a beneficial period (a period during which an expense
is expected to bring economic benefits to an entity) which is longer than one year and which includes at least part of the reporting period during
which the expense was incurred and subsequent reporting periods. An item of long-term deferred expenses is recognised at the actual amount of
the expense incurred and allocated in each month of the beneficial period using the straight line method.
4.17 Impairment of non-current and non-financial assets
Non-financial assets with non-current nature include fixed assets, construction in progress, intangible assets with definite useful lives, investment
properties measured by cost methods and long-term equity investment on subsidiaries, jointly operations. The Company assesses whether there
are any indicators of impairment for all non-financial assets at the balance sheet date, and impairment test is carried out and recoverable value is
estimated if such an indicator exits. Goodwill and intangible assets with indefinite useful lives, as well as intangible assets not ready for use, are
tested for impairment annually regardless of indicators of impairment.
Impairment of loss is calculated and provisions taken by the difference if the recoverable value of the assets is lower than the book value. The
recoverable value is the higher of estimated present value of the future expected cash flows from the asset and net fair value of the asset less
disposed cost. The fair value of asset is determined by the sales agreement price within an arm’s length transaction. In case there is no sales
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agreement, but there is active market of assets, the fair value can be determined by the selling price. If there is neither sales agreement nor active
market, the fair value of the asset can be estimated based on the best information obtained.
Disposal expenses include expenses related to the legislation, taxes, transportations and the direct expense for the asset to be ready for sale. When
calculating the present value of expected future cash flows from an asset or asset Group, the management shall estimate the expected future cash
flows from the asset or asset Group and choose a suitable discount rate in order to calculate the present value of those cash flows.
Provision for asset impairment is calculated and determined on the individual basis. If the recoverable of individual asset is hard to estimate, the
recoverable amount can be determined by the asset Group where subject asset belongs. Asset Group is the smallest set of assets that can have
cash flow in independently.
The Company determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the present value of the future
expected cash flows from the asset Groups or sets of asset Groups to which the goodwill is allocated. Estimating the present value requires the
Company to make an estimate of the expected future cash flows from the asset Groups or sets of asset Groups and also choose a suitable discount
rate in order to calculate the present value of those cash flows. Once the loss from above asset impairment is recognized, the recoverable part
cannot be reserved in the subsequent periods.
4.18 Accrued liabilities
Recognition of accrued liabilities:
Obligation with contingency factor such as external hypothecate, lawsuit or arbitrage in dispute, guarantee on quality of product, cut-down plan, loss
of contract, recombine obligation, obligation on abandon fixed asset, and meet the follow condition simultaneously would determined as liabilities:
①This obligation is current obligation of the Company; and,
②The performance of this obligation will probably cause economic benefits outflow of the Company; and,
③The amount of this obligation can be reliably measured.
Loss contracts and restructuring obligations of the Company meet the above conditions shall be recognized as accrued liabilities.
Measurement of accrued liabilities
Accrued liabilities would be measured initial according to the optimum evaluation of outflow of economic benefit, and the Company perform relate
obligation that consider risk, incertitude, time value of currency of contingency factor. Discount future cash flow to present value to determine the
optimum evaluation if the time value of currency has great impact. On balance sheet date, check the carry amount of accrued liabilities, and make
adjustment to carry amount to reflect the optimum evaluation. The increase amount in carry amount of accrued liabilities cause by time process
would be determined as interest fee.
Optimum evaluation of accrued liabilities
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If the necessary payments have scopes, the optimum evaluation shall be determined based on the average amount between the upper and lower
limit amount of scope ; if the necessary payments do not have such scopes, then the optimum evaluation shall be determined in the following
method:
① If the contingent event is involved in an individual project, the optimum evaluation amount will be determined base on the most possible amount;
② If the contingent event is involved more than one project, the optimum evaluation amount shall be determined base on possible amount and
occurrence probability. In case of all or part of payments about the confirmed liquidation liabilities are expected to be compensated by the third
parties or other parties, and the compensation amounts are surely received, then such amounts shall be separately recognized as assets. The
confirmed compensation amounts shall not exceed book values of confirmed liabilities.
4.19 Revenue
(1) Revenue from sales of goods
Revenue from sales of goods is recognised when significant risks and rewards attached to the ownership of the goods sold are passed to the buyer,
when neither continual involvement in the rights normally associated with the ownership of the goods sold nor effective control over the goods
controls are retained, when revenue arising from the goods sold is reliably measurable, when inflow of future economic benefits is probable, and
when cost incurred or to be incurred associated with the goods sold is reliably measurable.
Revenue arising from domestic sales of goods is recognised when goods are dispatched and delivered to the buyer, when significant risks and
rewards attached to the ownership of the goods sold are passed to the buyer, when neither continual involvement in the rights normally associated
with the ownership of the goods sold nor effective control over the goods controls are retained, when revenue arising from the goods sold is reliably
measurable, when inflow of future economic benefits is probable, and when cost incurred or to be incurred associated with the goods sold is reliably
measurable. Revenue arising from non-domestic sales of goods is recognised when goods are loaded on board and when the export clearance with
the custom is completed.
(2) Revenue from rendering of service
Revenue arising from rendering of services is recognised on the balance date using the percentage of completion method when the outcome of the
services rendered can be reliably estimated. The percentage of completion of the services rendered is calculated by dividing the cost to date by the
budgeted total cost.
The outcome of the services rendered can be reliably estimated when revenue from the services render can be reliably measured, when the inflow
of associated future economic benefits is probable, when the percentage of completion can be reliably measure, and when the cost incurred or to be
incurred associated with the services can be reliably measured.
When the outcome of the services rendered cannot be reliably estimate, revenue is recognised as cost reimbursement received or to be received, if
any, and cost incurred is recognised in profit or loss for the period in which the cost is incurred. No revenue is recognised if cost reimbursement is
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not probable.
When a contract between the group and another entity involves both sales of goods and rendering for services, the sales of goods and rendering of
services are accounted for separately if they are distinguishable and separately measurable; the contract is accounted for as if it is a contract
involves only sales of goods if the sales of goods and rendering of services are either indistinguishable or distinguishable but not separately
measurable.
(3) Royalty Revenue
According to the contract or agreement, the revenue is recognized on an accrual basis.
(4) Interest Income
The amount of interest revenue should be measured and confirmed in accordance with the length of time for which the enterprise's cash is used by
others and the actual interest rate.
4.20 Government Grants
Government grants are transfer of monetary assets and non-monetary assets from the government to the Company at no consideration, excluding
the capital invested by the government as equity owner. Government grant can be classified as grant related to the assets and grants related to the
income.
If a government grant is in the form of a transfer of a monetary asset, it is measured at the amount received or receivable. If a government grant is in
the form of a non-monetary asset, it is measured at fair value. If the fair value cannot be reliably determined, it is measured at a nominal amount. A
government grant measured at a nominal amount is recognized immediately in profit or loss for the period.
A government grant related to an asset is recognized as deferred income, and evenly amortized to profit or loss over the useful life of the related
asset. For a government grant related to income, if the grant is a compensation for related expenses or losses to be incurred in subsequent period,
the grant is recognized as deferred income, and recognized in profit or loss over the periods in which the related costs are recognized. If the grant is
a compensation for related expenses or losses already incurred, the grant is recognized immediately in profit or loss for the period.
For repayment of a government grant already recognized, if there is a related deferred income, the repayment is offset against the carrying amount
of the deferred income, and any excess is recognized in profit or loss for the period. If there is no related deferred income, the repayment is
recognized immediately in profit or loss for the period.
4.21 Deferred tax assets and deferred tax liabilities
(1) Income tax for the current period
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is
realized or the liability is settled, according to the requirements of tax laws. The measurement of deferred tax assets and deferred tax liabilities
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reflects
the tax consequences that would follow from the manner in which the Company expects at the balance sheet date, to recover the assets or settle
the liabilities.
At the balance sheet date, current income tax liabilities or assets for the current and prior periods, are measured at the amount expected to be paid
(or recovered) according to the requirements of tax laws. The calculation for income tax expenses in the current period is based on the taxable
income according to the related tax laws after adjustment to the accounting profit of the reporting period.
(2) Deferred income tax assets and liabilities
For temporary differences between the carrying amount of certain assets or liabilities and their tax base, or between the nil carrying amount of those
items that are not recognized as assets or liabilities and their tax base that can be determined according to tax laws, deferred tax assets and
liabilities are recognized using the balance sheet liability method.
For temporary differences associated with the initial recognition of goodwill and the initial recognition of an asset or liability arising from a transaction
(not a business combination) that affects neither the accounting profit nor taxable profits (or deductible losses) at the time of transaction, no deferred
tax asset or liability is recognized.
For taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint ventures, no deferred income
tax liability related is recognized except where the Company is able to control the timing of reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable future.
All deferred income tax liabilities arising from taxable temporary differences except the ones mentioned above are recognized.
For temporary deductible differences associated with the initial recognition of an asset or liability arising from a transaction (not a business
combination) that affects neither the accounting profit nor taxable profits (or deductible losses) at the time of transaction, no deferred tax asset is
recognized.
For taxable temporary deductible differences associated with investments in subsidiaries and associates, and interests in joint ventures, no deferred
income tax asset related is recognized if it is impossible to reversal the temporary difference in the foreseeable future, or it is not probable to obtain
taxable income which can be used for the deduction of the temporary difference in the future.
Except mentioned above, the Company recognizes other deferred income tax assets that can deduct temporary differences to the extent that it is
probable that taxable profits will be available against which the deductible temporary differences can be utilized.
For the deductible losses and tax credit that can be carried forward, deferred tax assets for deductible temporary differences are recognized to the
extent that it is probable that taxable profits will be available against which the deductible temporary differences can be utilized.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates according to tax laws, that are expected to apply in the
period in which the asset is realized or the liability is settled.
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At the balance sheet date, the Company reviews the carrying amount of deferred tax assets. If it is no longer probable that sufficient taxable profit
will be available in future periods to allow the benefits of the deferred tax assets to be used, the Company reduces the carrying amount of deferred
tax assets. The amount of such reduction is reversed when it becomes probable that sufficient taxable profit will be available
(3) Income tax expenses
Income tax expenses consist of current income tax and deferred income tax.
The expenses from income tax and deferred income tax, as well as the revenue, shall be recorded into profit or loss in current accounting period,
except expense for income tax of the current period and deferred income tax that booked into other income or equity and adjusted carrying value of
deferred income tax goodwill arose from business combination.
(4) Income tax offset
When we have the legal right, and have intended to, to make settlement with net amount, or through the asset acquisition and liability fulfillment
simultaneously, the Company shall present the net value from the offset between current income tax asset and current income tax liability in the
financial statement.
When the Company has the legal right to make a settlement with the current income tax asset and current income tax liability, and the deferred
income tax asset and deferred income tax liability are related to the same taxable subject under the same tax payer, or related to different taxable
subject, but the intension of net value settlement in regard of the current income tax asset and current income tax liability, the Company shall
present net value after the offset of deferred income tax asset and deferred income tax liability.
4.22 Leases
A finance lease is a lease that transfers in substance all the risks and rewards incident to ownership of an asset. Title may or may not eventually be
transferred. An operating lease is a lease other than a finance lease.
(1) The Company as Lessee under operating Lease
Lease payments under an operating lease are recognized by a lessee on a straight-line basis over the lease term, and either included in the cost of
the related asset or charged to profit or loss for the current period. The contingent rents shall be recorded in the profit or loss of the period in which
they actually arise.
(2) The Company as Leaser under operating Lease
Lease income from operating leases shall be recognized by the leaser in profit or loss on a straight-line basis over the lease term. Initial direct cost
of significance in amount shall be capitalized when incurred. If another basis is more systematic and rational, that basis may be used. Contingent
rents are credited to profit or loss in the period in which they actually arise.
(3) The Company as Lessee under financing Lease
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For an asset that is held under a finance lease, at the lease commencement, the leased asset is recorded at the lower of its fair value at the lease
commencement and the present value of the minimum lease payments, and the minimum lease payment is recorded as the carrying amount of the
long-term payables; the difference between the recorded amount of the leased asset and the recorded amount of the payable is accounted for as
unrecognized finance charge, Initial direct costs incurred by the lessee during the process of negotiating and securing the lease agreement shall be
added to the amount recognized for the leased asset.
The net amount of minimum lease payment deducted by the unrecognized finance shall be separated into long-term liabilities and long-term liability
within one year for presentation.
Unrecognized finance charge shall be computed by the effective interest method during the lease term. Contingent rent shall be booked into profit or
loss when actually incurred.
(4) In the case of the lesser of a financing lease
For an asset that is leased out under a finance lease, the aggregate of the minimum lease receipts at the inception of the lease and the initial direct
costs is recorded as a finance lease receivable, and unguaranteed residual value is recorded at the same time; the difference between the
aggregate of the minimum lease receipt, initial direct costs, and unguaranteed residual value, and the aggregate of their present values, is
recognized as unearned finance income, which is amortized using the effective interest rate method over each period during the lease term.
Finance lease receivable less unearned finance income shall be separated into long-term liabilities and long-term liability within one year for
presentation.
Unearned finance income shall be computed by the effective interest method during the lease term. Contingent rent shall be credited into profit or
loss in which actually incurred.
4.23 Assets held-for-sale
The Company has made decision on disposal of some non-current assets, and signed irrecoverable transferring agreements with buyers. The
transaction is probably to be completed with one year. If so, the non-current asset shall be counted as an asset ready-for-sale, not depreciated or
amortized, and shall be measured by the lower of carrying amount and faire value less net value of disposal expenses. Non-current assets
ready-for-sale includes individual asset and disposal Group. If disposal Group is an asset Group, and has allocated goodwill acquired during the
combination according to the Accounting Standard for Business Enterprises No. 8 - Impairment, or. the disposal Group is an operation in the asset
Group, the disposal Group includes goodwill in the business combination.
Where an asset or a disposal Group is classified as held-for-trade, but cannot satisfy the condition of non-current asset ready-for-trade, the
Company shall derecognize it as held-for-trade, and measure it by the lower of the followings:
(1) the carrying amount of the asset or disposal Group before it is classified as held-for-trade, the value after the adjustment of depreciation,
amortization or impairment recognized under the assumption that it is not classified as held-for-trade;
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(2) the recoverable value on the date when decided not to trade any more.
4.24 Employee Benefits
During the accounting period of an employee’ providing services to the Company, the Company recognizes the compensation payable as liabilities.
The Company participates in the employees social security system set up by government agencies, including pensions, medical insurance, housing
fund and other social security system, and the corresponding expenditures are included in the cost of related assets or the profit or loss.
When an enterprise terminates the employment relationship with employees before the end of the employment contracts or provides compensation
as an offer to encourage employees to accept voluntary redundancy, a provision shall be recognized for the compensation arising from termination
of employment relationship with employees, with a corresponding charge to the profit or loss for the current period. The enterprise cannot
unilaterally withdraw from the termination plan or the redundancy offer.
The early retirement plan adopts the same principles of termination benefits. Salaries and social insurance (from the date of ceasing services to the
date of normal retirement) are paid by the Company, subject to the conditions to be recognized in profit or loss (termination benefits).
4.25 Changes in major accounting policies and accounting estimates
(1) change of accounting policies
There is no significant change of accounting policies for the Company during the reporting period.
(2) change of accounting estimates
Content, reason and applicable point in time of change of accounting The name of the affected Affected
Approval procedures
estimates statement items amount
To harmonize and refine the management of fixed assets and the
Consideration and Fixed Assets,
accounting rules, more objective and fair response to the depreciation
approval by the 8th General and administra
of fixed assets situation reflects the accounting principle of prudence, 3,691,833.96
meeting of the Sixth tive expenses,
change the depreciation of fixed assets of the Company with effect
Board of Directors Financial costs
from January 1, 2012 . (See Note as follow)
Note: The classification of fixed assets estimated useful lives, the annual depreciation rate and the residual rate before the change of accounting
estimates.
Classification Expected useful life Estimated residual value(%) Depreciation(%)
Houses and building 8-35 years 3-5 2.7-12.1
Machineries 8-10 years 3-5 9.5-12.1
Vehicles 8 years 3 12.1
Office equipments and others 8 years 3 12.1
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The classification of fixed assets estimated useful lives, the annual depreciation rate and the residual rate after the change of accounting
estimates.
Classification Expected useful life Estimated residual value(%) Depreciation(%)
Houses and building 8-35 years 3-5 2.7-12.1
Machineries 8-10 years 3-5 9.5-12.1
Vehicles 4 years 3 24.25
Office equipments and others 3 years 3 32.33
4.26 Correction of prior period errors
There is no significant change of previous accounting errors for the Company during the reporting period.
4.27 Significant account judgment and estimates
The Company is required to make judgments, estimates and assumptions about the carrying amounts of items in the financial statements that
cannot be measured accurately, due to the internal uncertainties of operation activities. These judgments, estimates and assumptions are based
on historical experiences of the Company’s management as well as other factors that are considered to be relevant. These judgments, estimates
and assumptions may affect value of the financial statements in revenue, expenses, assets and liabilities and the disclosure of contingency at the
balance sheet date. However, the result derived from those uncertainties in estimates may lead significant adjustments to the carrying amounts of
the assets or liabilities affected in the future.
The Company has reviews the judgments, estimates and assumptions regularly on the basis of going concern. Where the changes in accounting
estimates only affect the period when changes occurred, and they are recognized within the same period. Where the changes in accounting
estimates affect both current period and future period, the changes are recognized within the period of change and future period.
At balance sheet date, the followings are the significant areas where the Company needs to make judgment, estimates and assumptions over the
value of items in the financial statements:
(1) Classification of lease
The Company classifies leases as operating lease and financing lease according to the rule stipulated in the Accounting Standard for Business
Enterprises No. 21--Leasing. The management shall make analysis and judgment on whether the risks and rewards related to the title of leased
assets has been transferred to the leaser, or whether the Company has substantially held the risks and rewards related to the ownership of leased
assets.
(2) Allowance for bad debt
According to the relevant accounting policies of the Company in receivables, allowance method is used for bad debt’s calculation. The impairment
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2012 Annual Report of Anhui Gujing Distillery Company Limited
of receivables is calculated based on the assessment of recoverable of receivables. Assurance of receivable impairment needs judgments and
estimations from the management. The difference between actual results and original estimates shall have impact on the carrying amount of
receivables and receivable bad debt provisions or the reverse during the change of estimation.
(3) Impairment of inventories
The Company measures inventories by the lower of cost and realizable net value according to the accounting policies in regard of inventories and
provisions for decline in value of inventories is made if the cost is higher than their net realizable value, and obsolete and slow-movement
inventories. Inventories decline in value to net realizable value is the estimated selling price in the ordinary course of business. Net realizable
value is determined on the basis of clear evidence obtained, and takes into consideration the purposes of holding inventories and effect of post
balance sheet events. The difference between the actual result and the original estimates shall have impact on reverse of the carrying amount of
the inventories and their decline in value or provisions during the period of change.
(4) The fair value of financial instruments
For a financial instrument which has no active market, the Company establishes fair value by using various valuation methods, including of
discounted cash flow analysis model. The Company needs to estimate future cash flow, credit risk, volatility and relationship during the valuation
and choose appropriate discount rate. Such assumptions have uncertainties and their changes shall have impact on the fair value of financial
instruments.
(5) Held-to-maturity investments
The Company will comply with the conditions of a fixed or determinable payments and fixed maturities that the Company has the positive intention
and ability to hold to maturity are non-derivative financial assets are classified as held-to-maturity investments. This classification requires
significant judgment. In the process of this judgment, the Company should make the assessment of its maturity willingness and ability to hold such
investments. Except in specified circumstances (for example, towards the maturity date of the sale amount is not significant investment), if the
Company is unable These investments held-to-maturity, shall be all the class investments classified as available-for-sale financial assets and in
the current fiscal year and the next two fiscal year shall not classify any financial assets as held-to-maturity investments. in this theoretical
situation, there have a significant impact on the financial statements listed on the reported value of financial assets, and affect the Company's
financial instruments risk management strategy.
(6) Held-to-maturity investments impairment
The Company to determine the held-to- maturity investments are impaired in dependent on management's judgment. Occurred objective evidence
of impairment including the disappearance of severe financial difficulties that financial asset cannot continue to be traded in an active market,
unable to fulfill the terms of the contract (for example, interest or principal payments as a default ) . In processing of judgment, the Company is
required to assess the occurred objective evidence of impairment of the investment in expected future cash flows.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
(7) Impairment of financial assets available-for-sale
The Company determine the available-for-sale financial asset is impaired relies on judgments and assumptions of management, to determine
whether impairment loss is recognized in the income statement. The process of making the judgments and assumptions, the Company is required
to assess the extent and duration of the fair value of the investment below cost, as well as investment financial position and short-term business
outlook, including industry conditions, technological change, the credit rating, default rates and counterparty risk.
(8) Impairment of non-financial, non-current assets
The Company assesses whether there are any indicators of impairment for all non-current assets other than financial assets at the balance sheet
date. For an intangible asset that has indefinite useful life, impairment test is made in addition to the annual impairment test if there is any
indication of impairment. For non-current assets other than financial assets, impairment test is made when there is any indication that its
account balance cannot be recovered.
Impairment exists when the recoverable amount of an asset is the higher of its fair value less cost of disposal and present value of the future cash
flows expected to be derived from the asset.
Net value between the difference of fair value and disposal cost is determined by reference of the price of similar product in a sale agreement in
an arm’s length transaction or an observable market price less the additional cost directly attributable to the disposal of the asset.
When estimating the present value of future cash flow, significant judgments are made over the asset’s production, selling price and relevant
operating expenses, and discount rate used to calculate present value. All available materials that are considered to be relevant shall be used in
the estimation of recoverable value. These materials include estimations of production, selling price and operating expenses based on reasonable
and supportable assumptions.
The Company makes an impairment test for goodwill at least at each year end. This requires an estimation of present value of future cash flow of
the assets or assets group where goodwill has been allocated. The Company shall makes estimation on the future cash flow derived from assets
or assets group and determine an appropriate discount rate for the present value of future cash flow when the estimation of present value of future
cash flow is made.
(9) Depreciation and amortization
Investment property, fixed assets and intangible assets are depreciated and amortized using the straight-line method over their useful lives after
taking into account residual value. The useful lives are regularly reviewed to determine the depreciation and amortization costs charged in each
reporting period. The useful lives are determined based on historical experience of similar assets and the estimated technical changes. If there is
an indication that there has been a change in the factor used to determine the depreciation or amortization, the rate of depreciation or amortization
is revised.
(10 ) The development expenditure
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2012 Annual Report of Anhui Gujing Distillery Company Limited
In determining the amount of capitalization, the Company 's management needs to make the relevant asset the estimated future cash flows,
applicable discount rate assumptions of the estimated benefit period.
(11) Deferred tax assets
The group shall recognize all unused tax losses as deferred tax assets to the extent that it is probable that future taxable profit will be available
against which the unused tax losses and unused tax credits can be utilized. This requires the management of the Company make a lot of
judgments over the estimation of time period, value and tax planning strategies when future taxable profit incurs so that the value of deferred tax
assets can be determined.
(12) Income tax
There are some transactions where ultimate tax treatments and calculations have uncertainties in the Company’s everyday operation. Whether it
is possible for some items to make expenditure before tax needs approval from competent tax authorities. If there is any difference between
finalized determination value and their initial estimations value, the difference shall have the impact on the
income tax and deferred income tax of the current period during the final determination.
(13) Accrued liabilities
According with the terms of the contract, the existing knowledge and historical experience, product quality assurance and expected contract
losses, delay in delivery of liquidated damages are estimated and recognized as a accrued liabilities. In these matters has been the formation of a
current obligation, and fulfilling the duty is likely to lead to the outflow of economic benefits of the Company, the Company or the best estimate of
the current obligation expenditure required recognized as a accrued liabilities. Recognition and measurement of accrued liabilities is dependent on
the judgment of management. In the processing of judgment the company needed to appraise the related risks, uncertainties and time value of
money and other factors.
The Company will sell, repair and renovation of goods sold to provide customers with quality after-sales service commitment is accrued liabilities.
Accrued liabilities have considered the recent experience in the maintenance data, but recent maintenance experience may not reflect future
maintenance. Any increase or decrease in t accrued liabilities may affect the profit or loss in future.
Note 5: Taxation
5.1 Major taxes and tax rate
Tax Tax rate (%)
Value added tax Revenues from sales of products and raw materials at the rate of 17%.
Consumption tax The consumption taxes have been provided at the rate of CNY 1.00 yuan per kg or 1,000
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Tax Tax rate (%)
ml follow the quantity, and the consumption tax have been provided at the rate of 20% of
the taxable sales.
Business tax Business tax rate is the 5% of taxable income
Urban maintenance Sum of VAT payable, consumption duty payable and business tax payable for the
and construction surcharge reporting period, and exempt and deductible tax at the rate of 1, 5, 7%.
Sum of VAT payable, consumption duty payable and business tax payable for the
Education surcharge
reporting period, and exempt and deductible tax at the rate of 3%.
Sum of VAT payable, consumption duty payable and business tax payable for the
Local education surcharge
reporting period, and exempt and deductible tax at the rate of 2%.。
Corporate income tax Income tax is calculated with the ratio of 25%.
The Group is engaged advertising revenue, previously calculated and paid business tax at the rate of 5%. According to “the notice of Ministry of
Finance, State Administration of Taxation on the transportation industry and modern service industry business tax reform VAT pilot in Shanghai
“--Cai Shui [2011] No.111 (财税[2011]111号) and other relevant, the subsidiary Shanghai Hong Bang Culture Communication Co., Ltd of the
Group is located in Shanghai is engaged advertising revenue and from the date of establishment impose value-added tax at the rate of 6%.
According to the “notice of the Ministry of Finance, the State Administration of Taxation on the transportation industry and modern service industry
business tax reform VAT pilot in Beijing and other 8 provinces and cities”--Cai Shui [2012] No.71 (财税[2012]71号) and other relevant, the
sub-subsidiary Anhui JinYunLai Culture and Media Co., Ltd. of the Group is located in Hefei city Anhui Province is engaged advertising revenue
and from 1 September, 2012 impose value-added tax at the rate of 6%.
Note 6: Business combination and the consolidated financial statements
6.1 Circumstance of subsidiaries
6.1.1 Subsidiaries acquired through incorporation or investment
The monetary unit is ten thousand unless otherwise stated.
Nature Organization
Type Place Registered Type of Corporate
Subsidiaries of Business scope Registration
of incorporation of registration capital business representative
business Code
Bozhou Gujing Wholesales of
Trade limited
Sales Co., Ltd. wholly-owned Bozhou, distilled spirit,
and 8,486.00 liability Liang Jinhui 151944818
(hereafter Gujing subsidiary Anhui construction
business company
Sales) materials, feeds
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Nature Organization
Type Place Registered Type of Corporate
Subsidiaries of Business scope Registration
of incorporation of registration capital business representative
business Code
and
assistant
materials
Bozhou Gujing
Transportation,
Transportation limited
wholly-owned Bozhou, Transport Sales,
Co., Ltd 695.00 liability Bai Yun 151940067
subsidiary Anhui ation maintenance
(hereafter Gujing company
service
Transportation)
Bozhou Gujing
Manufacture and limited
Glass Co., Ltd wholly-owned Bozhou, Manufact
6,646.00 sales of glass liability Qian Zhenhai 151946047
(hereafter Gujing subsidiary Anhui uring
products company
Glass)
Bozhou Gujing
Collect and sale of
Waste
Subsidinary of recycled glass limited
Reclamation Co., Bozhou,
wholly-owned Recycled 100.00 bottle, glass, and liability Qian Zhenhai 151946522
Ltd Anhui
subsidiary other company
(hereafter Gujing
wastebaskets
Waste)
Domestic
advertising
Anhui Jinyunlai Advertise production,
Subsidinary of limited
Culture & Media Hefei, ment publish, design
wholly-owned 200.00 liability Yan Lijun 562165325
Co.,Ltd. (hereafter Anhui marketin and agency;
subsidiary company
Jinyunlai) g conference
etiquette service,
craft gifts sales
Approved
operating
business:None.
General operating
business: Provide
Bozhou Gujing
packaging limited
Packaging Co., wholly-owned Bozhou, Manufact
3,000.00 services for liability Huai Huiying 58886276X
Ltd. (hereafter subsidiary Anhui uring
Gujing distilled company
Gujing Packaging)
spirit, Gujing
Gong series
distilled spirit,
vegetable and fruit
wine, health wine
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Nature Organization
Type Place Registered Type of Corporate
Subsidiaries of Business scope Registration
of incorporation of registration capital business representative
business Code
and mixed wine
Domestic
advertising
production,
publish, design
and agency;
Shanghai Hong conference
bang Culture Advertise etiquette service,
Subsidinary of limited
Communication ment craft gifts sales
wholly-owned Shanghai 500.00 liability Yan Lijun 593139218
Co., Ltd (hereafter marketin （Except the
subsidiary company
Shanghai g special projects）
Hongbang) (Business
involving
administrative
licensing, need to
get the operating
permit）
(Continued)
Actual amount of The balance of other items that,
Voting rights
Subsidiaries investment as at substantially constitute the net Holding proportion %
proportion %
31/12/201 investment in subsidiary
Gujing Sales 8,486.00 0.00 100.00 100.00
Gujing Transportation 695.00 0.00 100.00 100.00
Gujing Glass 6,646.00 0.00 100.00 100.00
Gujing Waste 100.00 0.00 100.00 100.00
Jinyunlai 200.00 0.00 100.00 100.00
Gujing Packaging 3,000.00 0.00 100.00 100.00
Shanghai Hongbang 500.00 0.00 100.00 100.00
(Continued)
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The balance of parent company’s equity, that is
Whether The amount of minority
equal to the parent shareholders’ equity less the
consolidate Minority equity used for decrease
Subsidiaries subsidiary’s current loss undertaken by the Notes
d equity the profits and losses of
minority shareholders according their quotient of
statements minority shareholders
the beginning of the period
Gujing Sales Yes 0.00 0.00 0.00
Gujing Transportation Yes 0.00 0.00 0.00
Gujing Glass Yes 0.00 0.00 0.00
Gujing Waste Yes 0.00 0.00 0.00
Jinyunlai Yes 0.00 0.00 0.00
Gujing Packaging Yes 0.00 0.00 0.00
Shanghai Hongbang Yes 0.00 0.00 0.00
6.1.2 Subsidiaries acquired through business combination under common control
The monetary unit is ten thousand unless otherwise stated.
Type Place
Registere Corporate Organization
of of Nature Type of
Subsidiaries d Business scope representat Registration
incorporatio registratio of business business
capital ive Code
n n
Hotel management（Except
for catering management、
Shanghai Gujing Except for hotel operation）
Jinhao Hotel Self-owned housing rental; limited
wholly-owne Hotel
Management Shanghai 5,400.00 establish branch（If there is liability Gong lei 134565998
d subsidiary Management
Co.,Ltd.(hereafter need administrative company
Shanghai Jinhao) licensing,
operating based on the
license.）
Accommodation, parking
Bozhou Gujing
services；Chinese limited
Hotel Co., wholly-owne Bozhou, Zhao Yufe
Hotel operation 62.80 meal process, sales of liability 151944834
Ltd.(hereafter d subsidiary Anhui ng
cigarette and wine and company
Gujing Hotel)
commodities
(Continued)
Actual amount of investment The balance of other items that, substantially Holding Voting rights
Subsidiaries
as at 31/12/201 constitute the net investment in subsidiary proportion % proportion %
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Actual amount of investment The balance of other items that, substantially Holding Voting rights
Subsidiaries
as at 31/12/201 constitute the net investment in subsidiary proportion % proportion %
Shanghai Jinhao 4,990.69 0.00 100.00 100.00
Gujing Hotel 64.86 0.00 100.00 100.00
Continued:
The balance of parent company’s equity, that is equal
The amount of minority
Whether to the parent shareholders’ equity less the
Minority equity used for decrease
Subsidiaries consolidated subsidiary’s current loss undertaken by the minority Notes
equity the profits and losses of
statements shareholders according their quotient of the
minority shareholders
beginning of the period
Shanghai Jinhao Yes 0.00 0.00 0.00
Gujing Hotel Yes 0.00 0.00 0.00
6.2 New subsidiaries included in the consolidated financial statement and the subsidiaries no longer included in the consolidated
financial statement during current reporting period
6.2.1 New subsidiaries included in the consolidated financial statement and the subsidiaries no longer included in the consolidated financial
statement during current reporting period.
6.2.1.1 New subsidiaries included in the scope of consolidation, special purpose entities formed by the trustee or leasing the right to control the
operating entity.
Subsidiaries Net assets value as at 31/12/2012 Net profit for the current reporting period
Shanghai Hongbang Culture
5,423,313.71 837,512.46
Communication Co., Ltd
Note: Shanghai Hongbang is the subsidiary acquired through incorporation or investment.
6.2.1.2 The subsidiaries no longer included in the scope of consolidation, special purpose entities formed by the trustee or leasing the right to
control the operating entity.
Subsidiaries The net assets of the disposal date Net profit for the beginning of the year to the disposal date
Hefei Gujing Trade Co., Ltd 0.00 -789,080.51
Note: The Hefei Gujing Trade Co., Ltd. finished cancellation during this year, which is no longer included in the scope of consolidation.
Note 7: Notes to significant elements of the financial statements
Unless otherwise stated (incl. notes to significant elements of the financial statements is ), the year ended is 31st December 2012, the year
beginning is 31st December 2011, this year is 2012, prior year is 2011 respectively.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.1 Monetary funds
Balance as at 31/12/2012 Balance as at 31/12/2011
Foreign
Items Foreign
Original amount exchange Translated amount Original amount Translated amount
exchange rate
rate
Cash in hand: 205,736.37 101,826.09
-CNY — — 205,736.37 — — 101,826.09
Bank deposit: 2,609,444,615.72 2,081,930,665.24
-CNY — — 2,609,440,918.78 — — 2,081,911,723.03
-USD 588.17 6.2855 3,696.94 3,006.27 6.3009 18,942.21
Total 2,609,650,352.09 2,082,032,491.33
Note: On 31 December, 2012, the carrying amount of CNY 200,000,000.00 fixed deposit pledged for bank acceptance.
7.2 Notes receivable
7.2.1 Disclosure by classification
Classification Balance as at 31/12/2012 Balance as at 31/12/2011
Bank acceptance 156,449,495.65 490,543,018.49
Total 156,449,495.65 490,543,018.49
Note: On 31 December, 2012, the carrying amount of CNY 17,000,000.00 bills pledged for bank acceptance.
7.2.2 The top five pledged of notes receivable amount at the end of the year
Issuer Issuer Date of maturity Amount Remarks
Bozhou Gujing Distillery Co., Ltd. 2012/11/15 2013/4/15 2,000,000.00
Anhui Jingqiao Business Co., Ltd. 2012/11/15 2013/4/15 2,000,000.00
Anhui Jingqiao Business Co., Ltd. 2012/11/15 2013/4/15 2,000,000.00
Anhui Jingqiao Business Co., Ltd. 2012/11/15 2013/4/15 2,000,000.00
Anhui Jingqiao Business Co., Ltd. 2012/11/15 2013/4/15 2,000,000.00
Total 10,000,000.00
7.2.3 There has no due to inability of the notes transferred to accounts receivable bills .
7.2.4 The end of the year has been endorsed to other parties but not yet due bills (the largest amount of the top five )
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Whether
Issuer Issuer Date of maturity Amount Notes
derecognition
Huangshan China Trading Co., Ltd. 2012/8/16 2013/2/16 2,300,000.00 Yes
Shangqiu Xintiandi Sugar & Alcohol Co., Ltd. 2012/7/5 2013/1/5 2,000,000.00 Yes
Fujian Daren Trade Co., Ltd. 2012/9/3 2013/3/2 2,000,000.00 Yes
Huainan Jindingcheng Trading Co., Ltd. 2012/10/8 2013/1/8 1,500,000.00 Yes
Huainan Jindingcheng Trading Co., Ltd. 2012/10/8 2013/1/8 1,500,000.00 Yes
Total 9,300,000.00
7.3 Accounts receivable
7.3.1 Disclosure by classification
Balance as at 31/12/2012
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
Accounts receivable belong to individual
significance and individually assessed for 0.00 0.00 0.00 0.00
impairment
Accounts receivable belong to recognition of
impairment allowances by group:
Age group 8,727,847.44 100.00 840,840.19 9.63
Total of Group 8,727,847.44 100.00 840,840.19 9.63
Accounts receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 8,727,847.44 100.00 840,840.19 9.63
(Continued)
Balance as at 31/12/2011
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Balance as at 31/12/2011
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
Accounts receivable belong to individual
significance and individually assessed for 0.00 0.00 0.00 0.00
impairment
Accounts receivable belong to recognition of
impairment allowances by group:
Age group 39,013,882.35 100.00 1,328,051.13 3.40
Total of Group 39,013,882.35 100.00 1,328,051.13 3.40
Accounts receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 39,013,882.35 100.00 1,328,051.13 3.40
7.3.2 Disclosure by age:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Amount % of total Amount % of total
Within 1 year 6,983,110.97 80.01 36,424,344.52 93.36
Including: within 6 months 6,194,326.53 70.97 32,023,338.50 82.08
6 months - 1year 788,784.44 9.04 4,401,006.02 11.28
1-2 years 1,066,990.07 12.23 1,994,998.68 5.12
2-3 years 89,975.40 1.03 12,543.15 0.03
Over 3years 587,771.00 6.73 581,996.00 1.49
Total 8,727,847.44 100.00 39,013,882.35 100.00
7.3.3 Allowance for bad debt:
① Accounts receivable using the age analysis method for measurement of allowance for bad debt:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Carrying amount Allowance for Carrying amount Allowance for
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Amount % of total bad debt Amount % of total bad debt
Within 1 year 6,983,110.97 80.01 101,382.49 36,424,344.52 93.36 540,283.68
Including: within 6 months 6,194,326.53 70.97 61,943.27 32,023,338.50 82.08 320,233.38
6 months - 1year 788,784.44 9.04 39,439.22 4,401,006.02 11.28 220,050.30
1-2 years 1,066,990.07 12.23 106,699.00 1,994,998.68 5.12 199,499.87
2-3 years 89,975.40 1.03 44,987.70 12,543.15 0.03 6,271.58
Over 3years 587,771.00 6.73 587,771.00 581,996.00 1.49 581,996.00
Total 8,727,847.44 100.00 840,840.19 39,013,882.35 100.00 1,328,051.13
7.3.4 There has no major impairment allowance of accounts receivable has been recovered/received during current reporting period.
7.3.5 There has no accounts receivable written off during the current reporting period.
7.3.6 There has no accounts receivable owed by entities which own 5% or more of the shares of the Company during the current reporting period.
7.3.7 Details of top five accounts receivable:
Relationship with Carrying amount % of total
Debtors Age
the Company as at 31/12/2012 accounts receivable
Franchiser A Non-related party 2,195,121.20 Within 6 Months 25.15
Franchiser B Non-related party 1,508,018.65 Within 2 years 17.28
Franchiser c C Non-related party 1,497,959.60 Within 6 Months 17.16
Franchiser D Non-related party 1,413,111.78 Within 6 Months 16.19
Franchiser F Non-related party 373,010.01 Within 2 years 4.27
Total 6,987,221.24 80.05
7.3.8 There has no accounts receivable balance due from related parties during the current reporting period.
7.4 Advances to suppliers
7.4.1 Disclosure by age:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Amount % of total Amount % of total
Within 1 year 85,184,699.47 99.86 233,258,065.73 100.00
1-2 years 121,274.00 0.14 4,645.00 0.00
Total 85,305,973.47 100.00 233,262,710.73 100.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.4.2 Details of top five advance to suppliers:
Relationship with Carrying amount Reason(s)
Suppliers Age
the Company as at 31/12/2012 for unsettlement
Payment in advance for
CCTV Non-related party 41,545,188.00 Within 1 year
advertising expense for 2013
Payment in advance for
Shenzhou Television Co., Ltd. Non-related party 7,392,875.00 Within 1 year
advertising expense for 2013
Anhui Jin Juan International Payment in advance for
Non-related party 5,330,000.00 Within 1 year
Advertisement advertising expense for 2013
Nanjing Luda Advertisement and media Payment in advance for
Non-related party 5,017,004.56 Within 1 year
Co., Ltd. advertising expense for 2013
The Beijing Zhicheng tang Payment in advance for
Non-related party 2,620,000.00 Within 1 year
advertisement Co., Ltd. advertising expense for 2013
Total 61,905,067.56
7.4.3 There has no advances to entities which own 5% or more of the shares of the Company.
7.5 Interests receivable
7.5.1 Interests receivable
Items Balance as at 31/12/2012 Balance as at 31/12/2011
Fixed deposit receipt 7,253,858.34 4,451,540.35
Total 7,253,858.34 4,451,540.35
7.5.2 There has no overdue interests receivable.
7.6 Other receivables
7.6.1 Disclosure by classification
Balance as at 31/12/2012
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
Other receivable belong to individual
51,109,940.55 69.51 51,109,940.55 100.00
significance and individually assessed for
119
2012 Annual Report of Anhui Gujing Distillery Company Limited
impairment
Other receivable belong to recognition of
0.00 0.00 0.00 0.00
impairment allowances by group:
Age group 22,424,206.84 30.49 865,059.86 3.86
Total of Group 22,424,206.84 30.49 865,059.86 3.86
Other receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 73,534,147.39 100.00 51,975,000.41 70.68
(Continued)
Balance as at 31/12/2011
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
Other receivable belong to individual
significance and individually assessed for 54,205,281.87 90.99 51,109,940.55 94.29
impairment
Other receivable belong to recognition of
impairment allowances by group:
Age group 5,368,699.28 9.01 581,622.74 10.83
Total of Group 5,368,699.28 9.01 581,622.74 10.83
Other receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 59,573,981.15 100.00 51,691,563.29 86.77
7.6.2 Disclosure by age:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Amount % of total Amount % of total
Within 1 year 21,567,003.41 29.33 4,630,889.38 7.77
Including: within 6 months 20,250,146.49 27.54 4,387,567.89 7.36
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2012 Annual Report of Anhui Gujing Distillery Company Limited
6 months - 1year 1,316,856.92 1.79 243,321.49 0.41
1-2 years 206,998.42 0.28 235,809.90 0.40
2-3 years 148,205.01 0.20 0.00 0.00
Over 3years 51,611,940.55 70.19 54,707,281.87 91.83
Total 73,534,147.39 100.00 59,573,981.15 100.00
7.6.3 Allowance for bad debt:
① Other receivables of individual significance and subject to individual impairment assessment
Rate of
Carrying Allowance for
Debtor allowance Reason for allowance
amount bad debt
(%)
Enterprise is in the proceeding of
Jianqiao Securities 12,223,000.00 12,223,000.00 100.00
liquidation bankruptcy
Enterprise is in the proceeding of
Hengxin Securities 29,502,438.53 29,502,438.53 100.00
liquidation bankruptcy
Enterprise is in the proceeding of
Minfa Securities 9,384,502.02 9,384,502.02 100.00
liquidation bankruptcy
Total 51,109,940.55 51,109,940.55 100.00
② Accounts receivable using the age analysis method for measurement of impairment allowances:
Accounts receivable using the age analysis method for measurement of impairment allowances:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age Carrying amount Allowance for bad Carrying amount Allowance for
Amount % of total debt Amount % of total bad debt
Within 1 year 56,041.75
21,567,003.41 96.18 268,257.51 4,630,889.38 86.25
Including: within 6 months 20,250,146.49 90.31 202,414.67 4,387,567.89 81.72 43,875.68
6 months - 1year 1,316,856.92 5.87 65,842.84 243,321.49 4.53 12,166.07
1-2 years 206,998.42 0.92 20,699.84 235,809.90 4.40 23,580.99
2-3 years 148,205.01 0.66 74,102.51 0.00 0.00 0.00
Over 3years 502,000.00 2.24 502,000.00 502,000.00 9.35 502,000.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Total 22,424,206.84 100.00 865,059.86 5,368,699.28 100.00 581,622.74
7.6.4 The major impairment allowance of other receivables has been recovered/received during current reporting period
Sum of impairment
Original basis of impairment
Debtors Reason(s) for recover allowance recognised Recovered amount
allowance
before recovered
Bankruptcy liquidation Enterprise is in the proceeding of
Minfa Securities 9,384,502.02 3,095,341.32
repayment liquidation bankruptcy
Total 9,384,502.02 3,095,341.32
7.6.5 There has no other receivable written off during the current reporting period.
7.6.6 There has no other receivable owed by entities which own 5% or more of the shares of the Company during the current reporting period.
7.6.7 Details of top five other receivable:
Relationship with the Carrying amount % of total
Debtors Age
Company as at 31/12/2012 accounts receivable
Hengxin securities Non-related party 29,502,438.53 Over 3 years 40.12
Jianqiao securities Non-related party 12,223,000.00 Over 3 years 16.62
Minfa securities Non-related party 9,384,502.02 Over 3 years 12.76
Beijing light manufacturing (Group) Co., Ltd. Non-related party 3,000,000.00 Within 6 months 4.08
Daqing Mei Ying Trade Co., Ltd. Non-related party 500,000.00 Over 3 years 0.68
Total 54,609,940.55 74.26
7.6.8 There has no other receivable balance due from related parties during the current reporting period.
7.7 Inventories
7.7.1 Disclosure by classification
As at 31/12/2012
Items
Carrying amount Impairment allowance Net carrying amount
Raw material and packaging
98,182,927.82 3,692,051.40 94,490,876.42
materials
Work in progress and
582,438,096.08 0.00 582,438,096.08
self-manufactured
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2012 Annual Report of Anhui Gujing Distillery Company Limited
semi-finished goods
Finished goods 106,632,198.17 1,161,671.82 105,470,526.35
Total 787,253,222.07 4,853,723.22 782,399,498.85
(Contiuned)
As at 31/12/2011
Items
Carrying amount Impairment allowance Net carrying amount
Raw material and packaging
80,384,897.21 3,021,570.96 77,363,326.25
materials
Work in progress and
self-manufactured 407,663,001.44 0.00 407,663,001.44
semi-finished goods
Finished goods 94,891,327.59 1,760,585.85 93,130,741.74
Total 582,939,226.24 4,782,156.81 578,157,069.43
7.7.2 Impairment allowance for inventories
Recognised Decrease in the current reporting period Carrying
Carrying amount as
Items during the current Carried to profit and amount as at
at 31/12/2011 Recovered
reporting period loss 31/12/2012
Raw material and packaging
3,021,570.96 2,709,793.31 0.00 2,039,312.87 3,692,051.40
materials
Finished goods 1,760,585.85 258,136.63 517,983.45 339,067.21 1,161,671.82
Total 4,782,156.81 2,967,929.94 517,983.45 2,378,380.08 4,853,723.22
7.8 Available - for - sale financial assets
Items Fair value as at 31/12/2012 Fair value as at 31/12/2011
Available-for-sale equity assets 27,991,376.84 0.00
Less: Impairment allowance 0.00 0.00
Total 27,991,376.84 0.00
Note: The Company holds available-for-sale equity instruments are the stocks of Lipeng shares, restricted period are 12 months and the beginning
date was 8 November, 2012.
7.9 Investment property
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7.9.1 Detial of investment property
Decrease in the
Carrying amount as Increase in the current Carrying amount as at
Item current reporting
at 31/12/2011 reporting period 31/12/2012
period
Using the cost model for subsequent
61,126,470.85 4,178,314.04 0.00 65,304,784.89
measurement of investment property
Less: Accumulated depreciation or
28,568,060.59 5,285,454.81 0.00 33,853,515.40
amortization of investment property
Less: Impairment allowance of investment
0.00 0.00 0.00 0.00
property
Net value of investment property 32,558,410.26 31,451,269.49
7.9.2 Investment property measured using the historical cost convention
Increase in the Decrease in the
Carrying amount as at Carrying amount as at
Item current reporting current reporting
31/12/2011 31/12/2012
period period
1.Cost: 61,126,470.85 4,178,314.04 0.00 65,304,784.89
Houses and buildings 58,481,878.85 4,178,314.04 0.00 62,660,192.89
Land use right 2,644,592.00 0.00 0.00 2,644,592.00
2.Accumulated depreciation and amortization 28,568,060.59 5,285,454.81 0.00 33,853,515.40
Houses and buildings 28,327,867.04 5,221,597.01 0.00 33,549,464.05
Land use right 240,193.55 63,857.80 0.00 304,051.35
3.Accumulated impairment
0.00 0.00 0.00 0.00
allowance
Houses and buildings 0.00 0.00 0.00 0.00
Land use right 0.00 0.00 0.00 0.00
4.Net carrying amount
32,558,410.26 31,451,269.49
Houses and buildings
Houses and buildings 30,154,011.81 29,110,728.84
Land use right 2,404,398.45 2,340,540.65
7.9.3 The houseing which the original book value is CNY 4,178,314.04 and accumulated depreciation is CNY 2,400,764.46 transferred into rental,
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2012 Annual Report of Anhui Gujing Distillery Company Limited
since the change in use the accounting from the corresponding fixed asset transferred into investment property.
7.9.4 The accumulated depreciation and amortization of investment property amounting to CNY 2,884,690.35.
7.9.5 Investment property with pending ownership registration
Estimated time of gone
Item The reason of without certificate of title through the certificate of Book value
title
Feed mill renovation project The certificate of title is in proceeding 2013 9,193,414.03
Filling workshop building ( third floor ) The certificate of title is in proceeding 2013 9,650,548.86
Filling workshop building ( second floor ) The certificate of title is in proceeding 2013 2,993,560.76
Total 21,837,523.65
7.10 Fixed assets
7.10.1 Circumstance of fixed assets
Decrease in the
Carrying amount as Increase in the current reporting Carrying amount as at
Item current reporting
at 31/12/2011 period 31/12/2012
period
1.Cost 859,712,029.43 482,494,573.06 25,235,888.58 1,316,970,713.91
530,798,978.04 311,890,855.76 4,539,751.00 838,150,082.80
Houses and buildings
Machineries 250,184,316.46 156,948,266.45 16,843,076.33 390,289,506.58
Vehicles 34,483,720.04 10,987,730.99 1,979,577.17 43,491,873.86
Administrative equipments and others 44,245,014.89 2,667,719.86 1,873,484.08 45,039,250.67
Newly Recognition for
2. Accumulated depreciation
increased current year
Accumulated depreciation 489,981,848.17 0.00 57,660,637.40 21,249,206.69 526,393,278.88
Houses and buildings 283,687,804.12 0.00 22,348,532.03 2,708,104.77 303,328,231.38
Machineries 161,378,514.05 0.00 18,881,699.89 15,051,161.85 165,209,052.09
Vehicles 14,289,697.93 0.00 10,105,664.99 1,738,182.06 22,657,180.86
Administrative equipments and others 30,625,832.07 0.00 6,324,740.49 1,751,758.01 35,198,814.55
3. Carrying amount before impairment
369,730,181.26 790,577,435.03
allowance
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Decrease in the
Carrying amount as Increase in the current reporting Carrying amount as at
Item current reporting
at 31/12/2011 period 31/12/2012
period
Houses and buildings 247,111,173.92 534,821,851.42
Machineries 88,805,802.41 225,080,454.49
Vehicles 20,194,022.11 20,834,693.00
Administrative equipments and others 13,619,182.82 9,840,436.12
4.Accumulated impairment allowance 6,951,990.42 0.00 114,760.54 6,837,229.88
Houses and buildings 4,264,099.10 0.00 0.00 4,264,099.10
Machineries 2,020,210.96 0.00 114,760.54 1,905,450.42
Vehicles 0.00 0.00 0.00 0.00
Administrative equipments and others 667,680.36 0.00 0.00 667,680.36
5.Net carrying amount 362,778,190.84 783,740,205.15
Houses and buildings 242,847,074.82 530,557,752.32
Machineries 86,785,591.45 223,175,004.07
Vehicles 20,194,022.11 20,834,693.00
Administrative equipments and others 12,951,502.46 9,172,755.76
Notes: The accumulated depreciation during the current reporting period is CNY 57,660,637.40, cost of fixed assets transferred from
construction in progress during the current reporting period amounting to CNY 446,324,803.51 ( please see the Note 7.9 Investment
property).
7.10.2 There has no restriction on ownership of fixed assets.
7.10.3 Details of temporary idle assets as at the end of the period
Accumulated
Accumulated Net carryting
Items Cost impairment Notes
depreciation
amount
allowance
Houses and buildings 15,646,500.09 11,190,960.05 4,264,099.10 191,440.94
Machineries 11,428,316.96 9,408,106.00 2,020,210.96 0.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Administrative equipments
1,772,209.55 1,104,529.19 552,919.82 114,760.54
and others
Total 28,847,026.60 21,703,595.24 6,837,229.88 306,201.48
7.10.4 Details of fixed assets let under operating leases as at the end of the period
Classification Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Machineries 1,202,652.55 1,522,294.56
Electronic equipments and others 141,334.83 226,104.58
Total 1,343,987.38 1,748,399.14
7.10.5 There has no fixed assets held for sale as at the end of the period.
7.10.6 Fixed assets with pending ownership registration.
Estimated time of gone through
Item The reason of without certificate of title Book value
the certificate of title
Boiler room Registration of ownership in progress 2013 1,321,165.28
Turbine house Registration of ownership in progress 2013 561,764.42
35KV substation room Registration of ownership in progress 2013 90,739.95
West district the liquor warehouse Registration of ownership in progress 2013 3,372,301.74
Packaging Building works (including the
Registration of ownership in progress 2013 2,383,237.88
package of seven workshops)
West district packaging materials
Registration of ownership in progress 2013 4,393,900.03
warehouse
West district the liquor steel mesh
Registration of ownership in progress 2013 3,673,199.09
warehouse
West district precision filtration steel
Registration of ownership in progress 2013 649,509.84
structure platform
Filling house Registration of ownership in progress 2013 5,023,172.46
Pooled registration upon
No.1 mold culture building Registration of ownership in progress 14,391,375.78
industrial park completion
Pooled registration upon
No.2 mold culture building Registration of ownership in progress 14,391,375.78
industrial park completion
No.3 mold culture building Registration of ownership in progress Pooled registration upon 14,391,375.79
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Estimated time of gone through
Item The reason of without certificate of title Book value
the certificate of title
industrial park completion
Pooled registration upon
No.1 distillery workshop Registration of ownership in progress 24,117,790.69
industrial park completion
Pooled registration upon
No.2 distillery workshop Registration of ownership in progress 24,445,037.74
industrial park completion
Pooled registration upon
No.3 distillery workshop Registration of ownership in progress 24,797,358.57
industrial park completion
Pooled registration upon
No.4 distillery workshop Registration of ownership in progress 24,744,798.40
industrial park completion
Pooled registration upon
Husk warehouse, mold culture house Registration of ownership in progress 42,116,603.90
industrial park completion
Pooled registration upon
No.1 distillery filling house Registration of ownership in progress 40,255,619.38
industrial park completion
Total 245,120,326.72
7.11 Construction in progress
7.11.1 Details of construction in progress
As at 31/12/2012 As at 31/12/2011
impairme
Carrying amount Carrying amount
Items impairment nt Net carrying
before impairment Net carrying amount before impairment
allowance allowanc amount
allowance allowance
e
Marketing network
134,984,829.10 0.00 134,984,829.10 0.00 0.00 0.00
construction
Bottle water filtration
1,170,773.54 0.00 1,170,773.54 0.00 0.00 0.00
equipment
Digital mold culture houses 2,148,230.00 0.00 2,148,230.00 0.00 0.00 0.00
High - quality base liquor
brewing technological 29,315,006.20 0.00 29,315,006.20 7,117,925.85 0.00 7,117,925.85
transformation projects
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2012 Annual Report of Anhui Gujing Distillery Company Limited
The base liquor hook storage,
filling and supporting facilities 147,924,721.89 0.00 147,924,721.89 40,493,357.07 0.00 40,493,357.07
construction projects
Based liquor relocation of the
transformation and facilities 105,640,963.16 0.00 105,640,963.16 84,455,897.59 0.00 84,455,897.59
projects
Gujing operating network 1,875,172.70 0.00 1,875,172.70 915,000.00 0.00 915,000.00
Technological transformation
0.00 0.00 0.00 24,920.00 0.00 24,920.00
project – No.1 workshop
Fine processing work building 0.00 0.00 0.00 10,000.00 0.00 10,000.00
Others 612,584.95 0.00 612,584.95 0.00 0.00 0.00
Total 423,672,281.54 0.00 423,672,281.54 133,017,100.51 0.00 133,017,100.51
7.11.2 Movement of significant construction in progress
Other decrease
Carrying Transferred to
Increase during
fixed assets during the Carrying amount
the current
amountasat during the current as at
Items Budgetedcost
reporting current
reporting 31/12/2012
31/12/2011 period reporting period
period
High - quality base liquor
brewing technological 102,000,000.00 7,117,925.85 69,286,533.00 28,482,444.03 18,607,008.62 29,315,006.20
transformation projects
The base liquor hook
storage, filling and
586,000,000.00 40,493,357.07 253,653,748.23 146,222,383.41 0.00 147,924,721.89
supporting facilities
construction projects
Based liquor relocation of
the transformation and 550,000,000.00 84,455,897.59 268,079,453.39 242,880,794.61 4,013,593.21 105,640,963.16
facilities projects
Gujing operating network 3,050,000.00 915,000.00 960,172.70 0.00 0.00 1,875,172.70
Technological
9,940,000.00 24,920.00 9,242,064.94 9,266,984.94 0.00 0.00
transformation project –
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Other decrease
Carrying Transferred to
Increase during
fixed assets during the Carrying amount
the current
amountasat during the current as at
Items Budgetedcost
reporting current
reporting 31/12/2012
31/12/2011 period reporting period
period
No.1 workshop
Fine processing work
20,200,000.00 10,000.00 19,406,619.00 19,416,619.00 0.00 0.00
building
West district new
55,577.52 0.00 55,577.52 55,577.52 0.00 0.00
warehouse
Marketing network
275,000,000.00 0.00 137,870,187.10 0.00 2,885,358.00 134,984,829.10
construction
Bottle water filtration
1,369,805.00 0.00 1,170,773.54 0.00 0.00 1,170,773.54
equipment
Digital mold culture
3,068,900.00 0.00 2,148,230.00 0.00 0.00 2,148,230.00
houses
Others 1,025,000.00 0.00 612,584.95 0.00 0.00 612,584.95
Total 1,551,709,282.52 133,017,100.51 762,485,944.37 446,324,803.51 25,505,959.83 423,672,281.54
(Continued)
Capitalisation
The cumulative Including: interests Weight of cost to
rate applicable Stage of
amount of capitalised date in budgeted
Items to the current completion Source of finance
interest during the current cost
reporting %
capitalized reporting period %
period %
High - quality base liquor The fund of rising
brewing technological 0.00 0.00 0.00 59.88 74.91 shares, Other
transformation projects sources
The base liquor hook
The fund of rising
storage, filling and
0.00 0.00 0.00 33.93 50.20 shares, Other
supporting facilities
sources
construction projects
Based liquor relocation of 0.00 0.00 0.00 58.60 64.10 Other sources
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Capitalisation
The cumulative Including: interests Weight of cost to
rate applicable Stage of
amount of capitalised date in budgeted
Items to the current completion Source of finance
interest during the current cost
reporting %
capitalized reporting period %
period %
the transformation and
facilities projects
Gujing operating network 0.00 0.00 0.00 61.48 61.48 Other sources
Technological
transformation project 0.00 0.00 0.00 93.23 100.00 Other sources
–workshop
Fine processing work
0.00 0.00 0.00 96.12 100.00 Other sources
building
West district new warehouse 0.00 0.00 0.00 100.00 100.00 Other sources
The fund of rising
Marketing network
0.00 0.00 0.00 50.20 50.20 shares, Other
construction
sources
Bottle water filtration
0.00 0.00 0.00 85.47 85.47 Other sources
equipment
Digital mold culture houses 0.00 0.00 0.00 70.00 70.00 Other sources
Others 0.00 0.00 0.00 59.76 59.76 Other sources
Total 0.00 0.00 0.00
Note: Other decreases CNY25,505,959.86 is transferred into the Long-term deferred expenses.
7.11.3 The progressof major construction in progress
Items Stage of completion% Notes
High - quality base liquor brewing technological
74.91 Estimated according to project progressing
transformation projects
The base liquor hook storage, filling and supporting facilities
50.20 Estimated according to project progressing
construction projects
Based liquor relocation of the transformation and facilities
64.10 Estimated according to project progressing
projects
Gujing operating network 61.48 Estimated according to project progressing
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Items Stage of completion% Notes
Marketing network construction 50.20 Estimated according to project progressing
Bottle water filtration equipment 85.47 Estimated according to project progressing
Digital mold culture houses 70.00 Estimated according to project progressing
Others 59.76 Estimated according to project progressing
7.12 Intangible assets
Carrying amount as at Current year Carrying amount as at
Category Current year increase
31/12/2011 decrease 31/12/2012
1. Historical cost 311,997,360.74 80,507,299.32 0.00 392,504,660.06
Land rights 270,793,360.80 80,456,060.00 0.00 351,249,420.80
trademark right 38,150,000.00 0.00 0.00 38,150,000.00
software 3,053,999.94 51,239.32 0.00 3,105,239.26
2. Cumulative depreciation 63,403,128.70 7,827,150.13 0.00 71,230,278.83
Land rights 24,582,620.60 7,137,928.63 0.00 31,720,549.23
trademark right 37,910,000.00 74,160.44 0.00 37,984,160.44
software 910,508.10 615,061.06 0.00 1,525,569.16
3. Impairment allowance 0.00 558,155.56 0.00 558,155.56
Land rights 0.00 0.00 0.00 0.00
trademark right 0.00 0.00 0.00 0.00
software 0.00 558,155.56 0.00 558,155.56
4. NBV 248,594,232.04 320,716,225.67
Land rights 246,210,740.20 319,528,871.57
trademark right 240,000.00 165,839.56
software 2,143,491.84 1,021,514.54
Amortisation recognised during the current year amounted to 7,827,150.13.
7.13 Long-term deferred charge
Carrying amount Current year Amortisation for Current year Carrying amount Other decreases
Items
reasons
as at 31/12/2011 increase the current decrease as at 31/12/ 2012
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2012 Annual Report of Anhui Gujing Distillery Company Limited
reporting period
Hall of Fame 3,650,877.17 0.00 1,251,729.27 0.00 2,399,147.90
Breweries industrial park
743,422.33 0.00 743,422.33 0.00 0.00
decoration
Fine filter tanks overhaul 141,965.72 0.00 141,965.72 0.00 0.00
House leasing in Zhengzhou 3,063,200.32 0.00 1,312,800.12 0.00 1,750,400.20
Compensation
Renovation works of 2011 of Beijing
Gujing Distillery Zhengzhou 2,079,000.00 233,015.00 520,435.86 660,000.00 1,131,579.14 Yuanzhou
experience club building Decoration
Company
Hangzhou experience club
0.00 1,022,630.23 284,063.83 0.00 738,566.40
project
Exclusive Shop 0.00 529,212.00 17,772.56 0.00 511,439.44
Image shop of sales
0.00 2,356,146.03 126,796.12 0.00 2,229,349.91
company
Transformation of high -
0.00 18,607,008.62 0.00 0.00 18,607,008.62
quality base liquor
Mold culture shelf and Mold
0.00 4,013,593.21 421,542.15 0.00 3,592,051.06
culture bed
Total 9,678,465.54 26,761,605.09 4,820,527.96 660,000.00 30,959,542.67
7.14 Deferred tax assets and deferred tax liabilities
7.14.1 Recognized deferred tax assets and deferred tax liabilities
① Recognized deferred tax assets
Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Deductible temporary
Item
Deductible temporary difference
Deferred tax assets difference and tax loss carried Deferred tax assets
and tax loss carried forwards
forwards
Allowance for bad debt 13,203,667.18 52,814,668.70 13,254,903.61 53,019,614.42
Impairment allowance for inventories 1,213,430.81 4,853,723.22 1,195,539.20 4,782,156.81
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Impairment allowance for fixed
1,709,307.47 6,837,229.88 1,737,997.61 6,951,990.42
assets
Unrealized internal buying and
174,624.28 698,497.12 155,725.48 622,901.90
selling profit
Deferred income 2,630,830.79 10,523,323.14 3,137,903.51 12,551,614.04
Accrued expenses 0.00 0.00 1,577,905.34 6,311,621.33
Deductible loss 19,837.63 99,188.13 118,096.95 512,867.42
Intangible assets 139,538.89 558,155.56 0.00 0.00
Total 19,091,237.05 76,384,785.75 21,178,071.70 84,752,766.34
② Recognized deferred tax liabilities:
Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Category Deferred tax Taxable temporary Taxable temporary
Deferred tax liabilities
liabilities differences differences
Changes in fair value of available - for - sale
697,845.96 2,791,383.84 0.00 0.00
financial assets
Total 697,845.96 2,791,383.84 0.00 0.00
7.14.2 Unrecognized deferred tax assets
Category Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Allowance for bad debt 1,171.90 0.00
Deductible loss 576,916.99 0.00
Total 578,088.89 0.00
7.15 Allowance for asset impairment
Carrying amount Current year Current decrease Carrying amount
Category
as at 31/12/2011 recognition Reversal Expanded as at 31/12/2012
1. Allowance for bad debt 53,019,614.42 289,927.61 493,701.43 0.00 52,815,840.60
2. Impairment allowance for inventories 4,782,156.81 2,967,929.94 517,983.45 2,378,380.08 4,853,723.22
3. Impairment allowance for fixed assets 6,951,990.42 0.00 0.00 114,760.54 6,837,229.88
4. Impairment allowance for intangible assets 0.00 558,155.56 0.00 0.00 558,155.56
Total 64,753,761.65 3,816,013.11 1,011,684.88 2,493,140.62 65,064,949.26
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.16 The restriction on ownership or use right of fixed assets
Carrying amount as at
Item The reason of restriction
31/12/2012
Subtotal of assets for pledge:
Bank deposit 200,000,000.00 Pledged for bank acceptance
Note receivable 17,000,000.00 Pledged for bank acceptance
Total 217,000,000.00
7.17 Notes payable
Type Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Bankers' acceptance 224,460,000.00 0.00
Total 224,460,000.00 0.00
Note: Notes payable due in the next reporting period amounts to 224,460,000.00.
7.18 Accounts payable
7.18.1 Detail for accounts payable
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Within 1 year 455,187,252.75 214,665,021.65
Over 1 year 5,925,322.51 5,158,834.80
Total 461,112,575.26 219,823,856.45
7.18.2 There has no accounts payable owed to investors investors holding 5% or more of the shares of the Company during the current period.
7.18.3 The details of significant accounts payable remaining unsettled for more than one year
Reason(s) for Post balance sheet date
Creditors Total amount
unsettlement repayment
Xinle city Renjie Glass Products Co., Ltd. 234,289.47 rest payment 0.00
ASDC Glass Group Co., Ltd. 148,797.22 rest payment 0.00
Shenzhen Gome packaging Co., Ltd. 155,801.66 rest payment 0.00
Shanghai Tianshi Printing Co., Ltd. 474,696.76 rest payment 0.00
Shenzhen Tianshi Printing Co., Ltd. 243,732.61 rest payment 0.00
Total 1,257,317.72 0.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.19 Advances from customers
7.19.1 General information
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Within 1 year 108,264,258.06 128,698,731.68
Over 1 year 6,345,977.75 6,898,456.20
Total 114,610,235.81 135,597,187.88
7.19.2 Advances from customers owed to investors investors holding 5% or more of the shares of the Company
See Note 8.5 Related party balances for details.
7.19.3 The details of significant Advances from customers due for more than one year
creditors Total amount Reason(s) for unsettlement
Zhuhai Lijing Trading and Development Co., Ltd. 29,753.35 rest payment
Gansu Hengshengyuan Trading Co., Ltd. 89,885.00 rest payment
Yongcheng Shenhuo Lida Trading Co., Ltd. 79,857.23 rest payment
Zhoukou Yixin Subsidiary foodstuff Co., Ltd. 22,872.00 rest payment
Xi'an Lintong District Yonghong firm 25,200.00 rest payment
Total 247,567.58
7.20 Employment benefits payable
Carrying amount as at Current year Current year Carrying amount as
Category
31/12/2011 increase decrease at 31/12/2012
(1) Wages and salaries, bonuses, subsidies
145,431,983.11 602,117,399.21 600,593,210.01 146,956,172.31
and allowances
(2) Employee benefits 0.00 20,442,359.04 20,442,359.04 0.00
(3) Social insurance 10,208,973.40 58,692,209.01 68,407,167.18 494,015.23
Within: ①Medical insurance 2,436,498.16 10,971,654.10 13,243,547.25 164,605.01
②Basic retirement insurance 6,447,583.35 39,655,850.03 45,824,517.04 278,916.34
③Unemployment fee 638,916.29 4,399,194.74 5,005,701.51 32,409.52
④Work injury insurance 374,575.79 2,036,926.36 2,401,231.54 10,270.61
⑤Pregnancy insurance 311,399.81 1,628,583.78 1,932,169.84 7,813.75
136
2012 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount as at Current year Current year Carrying amount as
Category
31/12/2011 increase decrease at 31/12/2012
(4) Housing provident fund 25,044,636.37 25,436,860.57 36,879,730.57 13,601,766.37
(5) dismission welfare 0.00 0.00 0.00 0.00
(6) Labor union fee and employee
12,076,484.39 13,749,023.44 8,150,879.06 17,674,628.77
education fee
(7) Non-monetary benefits Redemption of
0.00 6,414,502.19 6,414,502.19 0.00
termination of labor contract
(8) Redemption of termination of labor
0.00 0.00 0.00 0.00
contract
(9) Others 0.00 0.00 0.00 0.00
Total 192,762,077.27 726,852,353.46 740,887,848.05 178,726,582.68
Note: ① In the amounts outstanding as at 31 December 2012, no amount belongs to default, and the amounts has been paid in May 2013.
②To provide the workers with non-monetary benefits including festival liquor, self-produced and processed bottle of liquor for the collective
welfare regarded as sales, in accordance with external price to pay taxes regarded as revenue credited employees welfare, to provide the festival
liquor to Employees is CNY 6,414,502.19 during current period.
7.21 Taxes and fees payable
Tax (Fee) Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
VAT 127,424,001.36 145,921,550.30
consumption tax 155,841,940.75 195,847,812.80
Business tax 541,563.17 733,221.63
Urban construction and maintenance tax 25,478,732.45 25,868,592.02
Enterprise income tax 310,881,145.20 267,060,470.99
Personal income tax 12,215,372.29 4,739,780.86
Stamp duty 1,390,318.84 1,777,727.97
Education surcharge 9,400,238.21 25,773,125.40
Others 2,236,709.30 3,357,229.46
Total 645,410,021.57 671,079,511.43
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.22 Other payables
7.22.1 Detail for other payable
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Within 1 year 189,386,469.81 186,943,937.99
Over 1 year 107,712,308.17 61,946,080.79
Total 297,098,777.98 248,890,018.78
7.22.2 Other payables owed to investors investors holding 5% or more of the shares of the Company,
See Note 8.5 Related party balances for details.
7.22.3 Details of significant other payables remaining unsettled for more than one year
Reason for pending Post reporting date
Creditor Amount
settlement repayment
Shandong Taishan Hengxin Machinery Co., Ltd. 1,018,000.00 Rest payment of equipments 0.00
Guangxi Construction Engineering The first Installation Co., Ltd. 2,265,300.00 Rest payment of project 0.00
Bozhou Chengda Distillery Co., Ltd. 1,000,000.00 Deposit 0.00
Wenzhou Nanhu Commercial Group Co. , Ltd. 650,000.00 Deposit 0.00
Anhui Gujing Danya Wine Sales Co. , Ltd. 500,000.00 Deposit 0.00
Total 5,433,300.00 0.00
7.22.4 The explanation of the significant other payables
Carrying amount as at
Creditors Nature or content
31/12/2012
Guangxi Construction Engineering The first Installation Co., Ltd. 2,265,300.00 Rest payment of project
Total 2,265,300.00
7.23 Other current liabilities
Item Contents Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Deferred income government grant 2,120,250.11 2,075,708.75
Total 2,120,250.11 2,075,708.75
The details of deferred income:
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
The government assistance related to assets
Energy efficiency renovation project for coal industrial
153,000.00 430,708.75
boiler and glass furnace
Bozhou Logistics Center Project 60,000.00 60,000.00
Special funds for finance prevention and treatment
650,000.04 650,000.00
sewage
Finance subsidy for energy saving projects 531,623.52 370,000.00
Finance subsidy for technical reconstruction 534,221.52 525,000.00
Within financial budget, interest subsidy for deposit
39,999.96 40,000.00
technical reconstruction
Within financial budget, Enterprise development funds 30,000.00 0.00
Energy-saving technologies reward 121,405.07 0.00
Total 2,120,250.11 2,075,708.75
7.24 Other non-current liabilities
Item Contents Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Deferred income government grant 8,403,073.03 10,475,905.29
Total 8,403,073.03 10,475,905.29
The details of deferred income:
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
The government assistance related to assets
Energy efficiency renovation project for coal industrial
777,750.00 1,052,155.08
boiler and glass furnace
Bozhou Logistics Center Project 360,000.00 420,000.00
Special funds for finance prevention and treatment
1,300,000.16 1,950,000.21
sewage
Finance subsidy for energy saving projects 2,592,451.00 3,299,166.67
Finance subsidy for technical reconstruction 3,087,038.50 3,631,250.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Within financial budget, interest subsidy for deposit
83,333.37 123,333.33
technical reconstruction
Within financial budget, Enterprise development funds 202,500.00 0.00
Total 8,403,073.03 10,475,905.29
7.25 Share capital
Amount as at Amount as at
Movements during the current reporting period (+、－)
31/12/2011 31/12/2012
Item New Conversion Perce
Percent Bonus
Total amount shares from Others Subtotal Total amount ntage
age % issue
issue reserves %
1. Shares with restriction on
disposal
1.1 State-held shares
1.2 Shares held by state-owned
entities
1.3 Shares held by other
domestic investors 16,800,000 6.67 16,800,000 -33,599,100 -16,799,100 900 0.00
Within: Held by institutional
investors 16,800,000 6.67 16,800,000 -33,600,000 -16,800,000
Held by non-institutional
investors 900 900 900 0.00
1.4 Shares held by foreign
investors
Within: Held by institutional
investors
Held by non-institutional
investors
Subtotal of shares with restriction
on disposal 16,800,000 6.67 16,800,000 -33,599,100 -16,799,100 900 0.00
2. Floating shares
2.1 Ordinary shares issued in
CNY 175,000,000 69.50 175,000,000 33,599,100 208,599,100 383,599,100 76.17
2.2 Shares issued in
60,000,000 23.83 60,000,000 60,000,000 120,000,000 23.83
domestic stock market in
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Amount as at Amount as at
Movements during the current reporting period (+、－)
31/12/2011 31/12/2012
Item New Conversion Perce
Percent Bonus
Total amount shares from Others Subtotal Total amount ntage
age % issue
issue reserves %
foreign currency
2.3 Shares issued in foreign
market in foreign currency
2.4 Others
Subtotal of floating shares 235,000,000 93.33 251,800,000 33,599,100 268,599,100 503,599,100 100.00
Total 251,800,000 100.00 251,800,000 251,800,000 503,600,000 100.00
Note: According to the resolution of 2011 annual general meeting of stockholders, every 10 shares transferred to increase 10 shares by capital
reserves used the base of the 251.8 million shares on 31 December, 2011, the total amount of increase by transferring were 251.8 million shares
and has been implemented in 2012. After increase by transferring the registered capital was increased to CNY 503.6 million.
7.26 Capital reserves
Amount as at Current year Current year Amount as at
Item
increase decrease
31/12/2011 31/12/2012
Share premium 1,514,352,456.05 0.00 251,800,000.00 1,262,552,456.05
Other capital reserves 32,386,037.14 2,093,537.88 0.00 34,479,575.02
Total 1,546,738,493.19 2,093,537.88 251,800,000.00 1,297,032,031.07
Note: ① According to the resolution of 2011 annual general meeting of stockholders, every 10 shares transferred to increase 10 shares by
capital reserves used the base of the 251.8 million shares on 31 December, 2011, the total amount of increase by transferring were 251.8 million
shares and has been implemented in 2012.
② Other capital reserves for the current movements are the assets available-for-sale changes in fair value .
7.27 Surplus reserves
Amount as at Current year Current year Amount as at
Item
increase decrease
31/12/2011 31/12/2012
Statutory surplus reserve 147,070,297.60 71,666,667.13 0.00 218,736,964.73
Total 147,070,297.60 71,666,667.13 0.00 218,736,964.73
7.28 Retained earnings
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Rate of
Item Current year Prior year
appropriation
Pre-adjustment balance brought forward 815,506,493.66 381,153,314.20
Total adjustment to retained earnings b/f (+, -) 0.00 0.00
Retained earnings b/f after adjustment 815,506,493.66 381,153,314.20
Add: Net profit attributable to shareholders of the parent 725,589,286.31 566,390,286.36
Loss set off by surplus reserves 0.00 0.00
Others 0.00 0.00
10% of parent
Less: Appropriation to statutory surplus reserve 71,666,667.13 49,787,106.90
company net profit
Appropriation to discretionary surplus reserve 0.00 0.00
Ordinary dividends declared 113,310,000.00 82,250,000.00
Bonus issue 0.00 0.00
Balance carrying forward 1,356,119,112.84 815,506,493.66
7.29 Revenue and operating costs
7.29.1 General information
Item Current year Prior year
Principal operating income 4,148,697,033.94 3,277,533,563.45
Other operating income 48,360,281.32 30,445,672.55
Total 4,197,057,315.26 3,307,979,236.00
Principal operating cost 1,193,727,937.33 833,047,568.58
Other operating cost 27,103,204.17 27,965,196.12
Total 1,220,831,141.50 861,012,764.70
7.29.2 Revenues from principal operating activities by products
Current year Prior year
Products
operating revenues operating costs operating revenues Costs
Distilled spirit 4,045,542,438.97 1,138,829,249.65 3,178,683,815.08 765,457,373.60
Revenues from hotel 71,252,072.61 39,515,901.20 71,632,235.61 45,935,143.61
Others 31,902,522.36 15,382,786.48 27,217,512.76 21,655,051.37
Total 4,148,697,033.94 1,193,727,937.33 3,277,533,563.45 833,047,568.58
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.29.3 Principal operating activities by territories
Current year Prior year
Area
operating revenues operating costs operating revenues operating costs
Northern of mainland 568,399,645.44 151,656,054.70 580,662,250.61 139,829,006.96
Middle of mainland 3,148,329,457.17 927,072,746.35 2,203,318,287.36 574,366,286.72
Southern of mainland 426,771,503.96 113,527,787.01 490,513,802.78 118,120,401.09
International 5,196,427.37 1,471,349.27 3,039,222.70 731,873.81
Total 4,148,697,033.94 1,193,727,937.33 3,277,533,563.45 833,047,568.58
7.29.4 Operating income from top five customers
Year Operating income % of total operating income
2012 852,756,890.47 20.32
2011 451,226,530.68 13.64
7.30 Business tax and surcharges
Item Current year Prior year
Consumption tax 519,680,798.77 422,730,548.03
Business tax 5,149,740.18 5,062,777.71
Urban maintenance and construction tax,
114,078,873.02 94,561,951.36
Education surcharge
Embankment fee 35,855.04 34,777.83
Total 638,945,267.01 522,390,054.93
Note: The provision standards for taxes and surcharges refer to Note 5 Taxation.
7.31 Sales expenses
Item Current year Prior year
Employment benefits 66,643,650.94 76,826,712.64
Travel 39,576,202.36 34,243,626.56
Advertisement 372,150,734.27 205,228,902.67
Transportation charges 20,887,209.07 17,232,626.61
Sales promotion costs 201,908,242.79 147,813,975.79
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Item Current year Prior year
Sample wine 191,450,136.63 186,510,506.38
Service fee 177,453,272.82 115,792,599.63
Meeting expenses 249,536.00 5,273,474.70
Other sales expenses 5,658,249.99 9,144,654.41
Total 1,075,977,234.87 798,067,079.39
7.32 General and administrative expenses
Item Current year Prior year
Employment benefits 232,327,021.50 224,805,779.16
Office 26,821,119.45 19,341,431.30
Taxes and surcharges 13,516,285.73 11,374,904.66
Maintenance expenses 12,702,125.87 10,011,740.54
Depreciation 23,524,928.58 16,358,400.98
Amortization of intangible assets 7,657,076.06 5,479,919.79
Pollution discharge 5,670,578.37 3,874,640.53
Spillage of material 28,644,387.38 20,329,192.18
Travel expenses 7,838,738.24 6,151,946.21
Water and electricity charges 6,034,998.04 5,507,959.34
Others 30,593,245.87 22,380,042.89
Total 393,028,645.85 345,615,957.58
7.33 Financial costs
Item Current year Prior year
Interest expenses 1,400,816.93 0.00
Less: Interest income 76,739,005.96 41,040,473.83
Less: received bills charges 14,101,612.67 10,844,157.80
Exchange gain or loss -162.90 683.56
Bank charges 1,008,783.43 12,543.92
Others 200.00 0.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Total -88,430,981.17 -51,871,404.15
7.34 Impairment loss on assets
Item Current year Prior year
Allowance for bad debt -203,773.82 -4,266,716.00
Impairment allowance for inventory 2,449,946.49 2,905,125.30
Impairment allowance for intangible assets 558,155.56 0.00
Total 2,804,328.23 -1,361,590.70
7.35 Non-operating income
Included in current
Item Current year Prior year year non-recurring
profit and loss
Gain on non-current asset disposals 976,430.18 582,925.02 976,430.18
Within: Gain on fixed asset disposals 976,430.18 582,925.02 976,430.18
Government assistance (See details of government assistance) 3,603,355.00 2,755,614.88 3,603,355.00
Income from penalties 5,599,396.91 6,127,862.85 5,599,396.91
Sales of wastes 5,618,885.72 4,342,385.46 5,618,885.72
Unable pay for the overdue accounts payable 927,341.44 408,462.40 927,341.44
Amortization of deferred tax 2,268,290.90 1,356,287.98 2,268,290.90
Others 2,978,377.73 1,337,764.32 2,978,377.73
Total 21,972,077.88 16,911,302.91 21,972,077.88
Details of government grant:
Government assistance Current year Prior year Description
Subsidy revenue 3,603,355.00 1,779,000.00
Tax refunds 0.00 976,614.88
Total 3,603,355.00 2,755,614.88
7.36 Non-operating expenses
Included in current year
Category Current year Prior year
non-recurring profit and loss
Loss on non-current asset disposals 511,271.68 396,678.97 511,271.68
Within: Loss on fixed asset disposals 511,271.68 396,678.97 511,271.68
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Included in current year
Category Current year Prior year
non-recurring profit and loss
Abandonment loss 672,811.62 1,757,080.92 672,811.62
Overdue fine 434,979.78 0.00 434,979.78
Indemnity paid 307,789.45 130,000.00 307,789.45
Charitable donation 100,000.00 0.00 100,000.00
Others 1,419,843.56 335,593.98 1,419,843.56
Total 3,446,696.09 2,619,353.87 3,446,696.09
7.37 Income tax expenses
Category Current year Prior year
Current tax calculated in accordance with relevant tax law 244,750,939.80 282,249,054.69
Deferred tax 2,086,834.65 1,435,563.90
Total 246,837,774.45 283,684,618.59
7.38 Computation of basic earnings per share and diluted earnings per share
Basic earnings per share is calculated by dividing net profit attributable to shareholders of the parent by the weighted average number of issued
shares. The start date of ordinary shares issued in the period for the purpose of calculation of basic earnings per share is the date on which
subscription becomes receivable per contract of issuance.
Diluted earnings per share is calculated by dividing the results of adjustment of net profit attributable to shareholders of the parent for the interest
expense for the dilutive convertible instruments, the expected gain or expense at the time of conversion and their related income tax implication by
the sum of the weighted average number of issued shares for calculation of basic earnings per shares and the weighted average number of
potential shares from convertible instruments.
For the purpose of calculation of the weighted average number of potential shares from convertible instruments, the conversion date for dilutive
convertible instruments issued in prior period and dilutive convertible instruments issued in the period is the 1st date of the period and the issue
date respectively.
7.38.1 General disclosure
Current year Prior year
Category of earning
Basic EPS Diluted EPS Basic EPS Diluted EPS
Net profit attributable to ordinary shareholders 1.44 1.44 1.17 1.17
Recurring profit or loss attributable to ordinary shareholders 1.41 1.41 1.14 1.14
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2012 Annual Report of Anhui Gujing Distillery Company Limited
7.38.2 Calculation
During the reporting period, the Company does not have dilutive potential ordinary shares, diluted earnings per share therefore is equal to the
basic earnings per share.
① Net profit attributable for ordinary shareholders for the calculation of basic EPS
Category Current year Prior year
Net profit attributable for ordinary shareholders
725,589,286.31 566,390,286.36
Within: From continuing operation 726,378,366.82 566,390,286.36
From curtailed operation -789,080.51 0.00
Recurring profit or loss attributable to ordinary shareholders 711,934,788.75 553,567,092.68
Within: From continuing operation 711,980,505.70 553,567,092.68
From curtailed operation -45,716.95 0.00
②When calculating the basic earnings per share, the denominator is the weighted average number of outstanding ordinary shares, calculated as
follows
Category Current year Prior year
Number of ordinary shares issued as at 31/12/2011
503,600,000.00 470,000,000.00
Add: the number of ordinary shares issued this year
0.00 14,000,000.00
Less: the number of ordinary shares bought back this year
0.00 0.00
Number of ordinary shares as at 31/12/2012
503,600,000.00 484,000,000.00
In according to the principle of the "Accounting Standards for Business Enterprises No. 34 - Earnings per share", the payment of stock dividends,
public accumulated fund transferred to increase capital, splits or reverse stock occurred during the balance sheet date to the financial report date,
should use the re-adjusted number of shares to recalculate the earnings per share for all periods. During the year, the company 's total share
capital of 251,800,000 shares as the base, to paid-in capital of 10 shares for every 10 shares to all shareholders. In according with the principle to
recalculated the previous year earnings per share and diluted earnings per share.
7.39 Other comprehensive income
Category Current year Prior year
The amount of gains (losses) on available-for-sale financial assets 2,791,383.84 0.00
Less: Tax effect from available-for-sale financial assets 697,845.96 0.00
Net amount which recognized in other comprehensive income previously reclassified 0.00 0.00
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
into profit or loss during current period
Total 2,093,537.88 0.00
7.40 Notes to the statement of cash flows
7.40.1 Other cash received relating to operating activities
Category Current year Prior year
Guarantee deposit 42,383,087.63 138,613,744.77
Government assistance 3,603,355.00 1,779,000.00
Interest income 88,038,300.64 36,588,933.48
Other 18,235,261.87 36,891,291.24
Total 152,260,005.14 213,872,969.49
7.40.2 Other cash payments relating to operating activities
Category Current year Prior year
Cash paid in sales expenses and general and administrative expense 722,967,136.75 448,726,046.33
The fixed deposit pledged for Notes payable 200,000,000.00 0.00
Others 3,271,396.22 1,484,273.09
Total 926,238,532.97 450,210,319.42
7.40.3 Other cash received relating to investing activities
Category Current year Prior year
Government assistance related to assets 240,000.00 8,100,000.00
Total 240,000.00 8,100,000.00
7.40.4 Other cash received relating to financing activities
Category Current year Prior year
The payment of the cost associated with shares issuance 0.00 3,211,800.00
Total 0.00 3,211,800.00
7.41 Supplementary information to the statement of cash flows
7.41.1 Reconciliation of cash flows from operating activities to net profit
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
① Reconciliation of cash flows from operating activities to net profit:
Net profit
725,589,286.31 566,390,286.36
Add: Loss on asset impairment 425,948.15 -8,579,878.92
Depreciation of fixed assets, oil and gas assets, biological assets held for production 57,660,637.40 45,377,730.01
Amortisation of Investment properties 2,884,690.35 3,537,860.03
Amortisation of intangible assets 7,827,150.13 5,479,919.79
Amortisation of Long-term deferred expenditure 4,820,527.96 2,053,899.07
Loss on non-current assets disposal (gain presented by "-" prefix) -465,158.50 -186,246.05
Loss on scrap of fixed assets (gain presented by "-" prefix) 672,811.62 638,191.45
Loss on fair value changes (gain presented by "-" prefix) 0.00 0.00
Financial costs (gain presented by "-" prefix) -162.90 683.56
Investment loss (gain presented by "-" prefix) 0.00 -1,656,581.66
Decrease of deferred tax assets (increase presented by "-" prefix) 2,086,834.65 1,435,563.90
Increase of deferred tax liabilities (increase presented by "-" prefix) 0.00 0.00
Decrease of inventories (increase presented by "-" prefix) -204,313,995.83 -120,964,419.83
Decrease of operating receivables (increase presented by "-" prefix) 148,886,768.63 -477,342,793.89
Increase of operating payables (decrease presented by "-" prefix) 343,060,317.39 611,073,541.51
Others -2,268,290.90 -1,356,287.98
Net cash flows generated from operating activities 1,086,867,364.46 625,901,467.35
② Significant investing and financing activities involve no cash:
Debt-to-capital conversion 0.00 0.00
Convertible loan due within one year 0.00 0.00
Fixed assets acquired under financial lease 0.00 0.00
③ Movement of cash and cash equivalents:
Cash as at 31/12/2012 2,409,650,352.09 2,082,032,491.33
Less: Cash as at 31/12/2011 2,082,032,491.33 643,231,404.42
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
Add: Cash equivalents as at 31/12/2012 0.00 0.00
Less: Cash equivalents as at 31/12/2011 0.00 0.00
Net increase of cash and cash equivalents 327,617,860.76 1,438,801,086.91
7.41.2 Compostion of cash and cash equivalents
Category Current year Prior year
① Cash 2,409,650,352.09 2,082,032,491.33
Including: Cash at hand 205,736.37 101,826.09
Demand bank deposit 2,409,444,615.72 2,081,930,665.24
Demand other monetary funds 0.00 0.00
Demand deposit in the Central Bank 0.00 0.00
Deposit in peer firms 0.00 0.00
Loan to peer firms 0.00 0.00
② Cash equivalents
Including: Debt instrument matured within three months 0.00 0.00
③ Cash and cash equivalents as at 31/12/2012 2,409,650,352.09 2,082,032,491.33
Note 8: Related parties and related party transaction
8.1 Details of the parent
Name of Type of Place of Legal
Relationship Nature of business
parent incorporation registration representative
Controlling Drink, building materials,
Gujing Group Limited liability company Anhui Yulin
shareholders manufacture plastic products
(Continued)
Name of Registered Shareholding Voting right Ultimate controller
Organisation code
paren capital in the Company % in the Company % of the Company
Gujing Group 353,380,000.00 53.89 53.89 Anhui Province Bozhou City 151947437
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2012 Annual Report of Anhui Gujing Distillery Company Limited
the People’s Government
8.2 Subsidiaries
See Note 6.1 Subsidiaries.
8.3 Other related parties
Other related party Relationship to the Company Institution code
Anhui Ruifuxiang Food Co., Ltd Affiliate of the actual controller and controlling shareholder 77908892-2
Anhui Ruijing Business Travel (Group) Co., Ltd Affiliate of the actual controller and controlling shareholder 14912443-1
Bozhou Guesthouse Co., Ltd. Affiliate of the actual controller and controlling shareholder 554599270
Anhui Orient Taiji Travel Development Co., Ltd. Affiliate of the actual controller and controlling shareholder 771139617
Bozhou Gujing Hotel Co., Ltd. Affiliate of the actual controller and controlling shareholder 151940032
Anhui Gujing Real Estate Group Co., Ltd. Affiliate of the actual controller and controlling shareholder 697383485
Orient Ruijing Enterprise Investment
Affiliate of the actual controller and controlling shareholder 768363191
Development Co., Ltd.
Anhui Hengxin Pawn Co., Ltd. Affiliate of the actual controller and controlling shareholder 752994458
Bozhou Ruineng Thermal Power Co., Ltd. Affiliate of the actual controller and controlling shareholder 560699980
8.4 Related party transactions
8.4.1 Goods and services purchase
Current year Prior year
Pricing principle % in total % in total
Related party Transaction
transaction of transaction of
Amount Amount
the same the same
category category
Anhui Ruifuxiang Food Co.,
Procurement alcohol Market price 46,869,135.05 49.31 45,785,065.26 62.12
Ltd
Accept catering and
Bozhou Guesthouse Co.,
accommodation Market price 1,419,862.30 2.72 562,530.92 1.29
Ltd.
service
Total 48,288,997.35 46,347,596.18
8.4.2 Sales of goods and vendering of services
Related party Transaction Pricing principle Current year Prior year
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2012 Annual Report of Anhui Gujing Distillery Company Limited
% in total % in total
transaction of transaction of
Amount Amount
the same the same
category category
Sales of mini
Gujing Group Market price 33,035.63 1.40 10,462.85 0.46
materialss
Provide catering
Gujing Group Market price 237,582.16 9.42 328,564.71 12.69
services
Anhui Ruijing Famous Wine Sales of distilled
Market price 0.00 0.00 16,149,989.74 0.46
Marketing Co., Ltd
spirit
Sales of distilled
Anhui Ruifuxiang Food Co., Ltd Market price 136,538.47 0.00 1,517,718.81 0.05
spirit
Anhui Ruijing Business Travel Advertising
Market price 8,100.00 0.00 5,549.90 0.01
(Group) Co., Ltd service
Sales of distilled
Bozhou Guesthouse Co., Ltd. Market price 81,461.54 0.00 32,153.85 0.00
spirit
Provide catering
Bozhou Guesthouse Co., Ltd. Market price 0.00 0.00 4,000.00 0.35
services
Anhui Orient Taiji Travel Sales of distilled
Market price 35,897.44 0.00 170,119.66 0.01
Development Co., Ltd
spirit
Sales of distilled
Anhui Ruijing Real Estate Co., Ltd Market price 7,692.31 0.00 615.38 0.00
spirit
Sales of distilled
Bozhou Gujing Hotel Co., Ltd. Market price 70,769.24 0.00 123,076.94 0.00
spirit
Anhui Gujing Real Estate Group Sales of distilled
Market price 110,153.83 0.00 93,107.36 0.00
Co., Ltd.
spirit
Sales of distilled
Anhui Ruijing Food Co., Ltd. Market price 149,384.62 0.01 0.00 0.00
spirit
Orient Ruijing Enterprise Sales of distilled
Market price 0.00 0.00 36,444.73 0.00
Investment Development
spirit
Bozhou Ruineng Thermal Power Sales of distilled
Market price 75,538.46 0.00 90,000.00 0.00
Co., Ltd.
spirit
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Current year Prior year
% in total % in total
Related party Transaction Pricing principle
transaction of transaction of
Amount Amount
the same the same
category category
Sales of distilled
Anhui Hengxin Pawn Co., Ltd. Market price 8,461.53 0.00 7,999.99 0.00
spirit
Total 954,615.23 18,569,803.92
8.4.3 Lease between related parties
Pricing Lease rental
Leasor Leasee Leased asset Start date Expiry date
principle recognised
Gujing Group The Company Buildings and constructions 2010-6-1 2020-5-31 Market price 1,800,000.00
Gujing Group Gujing Hotel Buildings and constructions 2010-6-1 2020-5-31 Market price 500,000.00
Total 2,300,000.00
8.5 Related party balance
8.5.1 Receivables owed by and advances paid to related parties
Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Related party
Allowance for Allowance for bad
Carrying amount Carrying amount
bad debt debt
Accounts receivable:
Gujing Group 0.00 0.00 38,485.49 384.85
Anhui Ruifuxiang Food Co., Ltd 0.00 0.00 2,000.00 20.00
Total 0.00 0.00 40,485.49 404.85
Other receivables:
Orient Ruijing Enterprise Investment Development 0.00 0.00 5,704.00 57.04
Total 0.00 0.00 5,704.00 57.04
8.5.2 Payables owed to and advances received from related parties
Related party Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Advances received:
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Anhui Orient Taiji Travel Development Co., Ltd 0.00 10,000.00
Anhui Ruijing Business Travel (Group) Co., Ltd 18,000.00 0.00
Ruijing Business Travel (Group) Co., Ltd Shanghai branch 1,700.00 0.00
Total 19,700.00 10,000.00
Other payable:
Anhui Ruijing Business Travel (Group) Co., Ltd 83,996.92 105,999.42
Gujing Group 4,964.37 180,311.93
Anhui Ruifuxiang Food Co., Ltd 2,000.00 200.00
Bozhou Guesthouse Co., Ltd. 0.00 10,360.00
Anhui Orient Taiji Travel Development Co., Ltd 3,000.00 8,000.00
Anhui Ruijing Food Co., Ltd. 27,000.00 0.00
Total 120,961.29 304,871.35
Note 9: Contingencies
No contingency is subject to disclosure as at 31 December 2012.
Note 10: Commitments
On the reporting date, the non-cancellable operating lease contracts which were signed by the Group are as following:
Item Carrying amount as at 31/12/2012 Carrying amount as at 31/12/2011
Minimum lease payments under non-cancellable operating
leases:
The first year after reporting date 2,300,000.00 2,300,000.00
The second year after reporting date 2,300,000.00 2,300,000.00
The third year after reporting date 2,300,000.00 2,300,000.00
After years 33,158,333.33 35,458,333.33
Total 40,058,333.33 42,358,333.33
No financial commitment is required for disclosure as at 31 December 2012.
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Note 11: Post reporting date events
The Proposal for Profit Appropriation for the Year ended 31 December 2012 proposing cash dividend amounting to CNY 5.00 (gross) per 10 shares
for the 503.60 million shares outstanding as at the reporting date which in total amounts to CNY 251.80 million was approved by the 16th Meeting of
the 6th Term of Board of Directors of the Company held on 21 April 2013; the Proposal was pending the approval of the General Meeting of the
Company.
No other post-balance-sheet-date event is required for disclosure as at the balance sheet date.
Note 12: Other significant events
12.1 Assets and liabilities measured by fair value
Carrying Cumulative fair value
Current year fair Current year Carrying amount
Item amount as at movement recognised
value movement impairment as at 31/12/2012
31/12/2011 in equity
Financial assets
Available-for-sale financial assets 0.00 0.00 2,791,383.84 0.00 27,991,376.84
Total
12.2 Termination of operation
Item Current year Prior year
Revenue of termination of operation 0.00 0.00
Less: Expense of termination of operation 789,080.51 0.00
Gross profit of termination of operation -789,080.51 0.00
Less: Income tax expense of termination of operation 0.00 0.00
Net profit of termination of operation -789,080.51 0.00
Note 13: Notes to the separate financial statements
13.1 Accounts receivable
13.1.1 Classification
Balance as at 31/12/2012
Carrying amount before impairment
Items Allowance for bad debt
allowanc
Amount % of total Amount % of total
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Accounts receivable belong to individual
significance and individually assessed for 0.00 0.00 0.00 0.00
impairment
Accounts receivable belong to recognition of
impairment allowances by group:
Related party group 1,293,202.89 68.75 0.00 0.00
Age group 587,771.00 31.25 587,771.00 100.00
Total of Group 1,880,973.89 100.00 587,771.00 31.25
Accounts receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 1,880,973.89 100.00 587,771.00 31.25
(Continued)
Balance as at 31/12/2011
Carrying amount before impairment
Items Allowance for bad debt
allowanc
Amount % of total Amount % of total
Accounts receivable belong to individual
significance and individually assessed for 0.00 0.00 0.00 0.00
impairment
Accounts receivable belong to recognition of
impairment allowances by group:
Related party group 0.00 0.00 0.00 0.00
Age group 2,461,104.32 100.00 603,616.83 24.53
Total of Group 2,461,104.32 100.00 603,616.83 24.53
Accounts receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 2,461,104.32 100.00 603,616.83 24.53
13.1.2 Disclosure by age
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Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Amount % of total Amount % of total
Within 1 year 1,293,202.89 68.75 1,873,333.32 76.12
Including: within 6 months 1,293,202.89 68.75 1,873,333.32 76.12
1-2 years 0.00 0.00 0.00 0.00
2-3 years 0.00 0.00 5,775.00 0.23
Over 3years 587,771.00 31.25 581,996.00 23.65
Total 1,880,973.89 100.00 2,461,104.32 100.00
13.1.3 Allowance for bad debt
Accounts receivable using the age analysis method for measurement of allowance for bad debt:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age Carrying amount Allowance for Carrying amount Allowance for
Amount % of total bad debt Amount % of total bad debt
Within 1 year 0.00 0.00 0.00 1,873,333.32 76.12 18,733.33
Including: within 6 months 0.00 0.00 0.00 1,873,333.32 76.12 18,733.33
1-2 years 0.00 0.00 0.00 0.00 0.00 0.00
2-3 years 0.00 0.00 0.00 5,775.00 0.23 2,887.50
Over 3years 587,771.00 100.00 587,771.00 581,996.00 23.65 581,996.00
Total 587,771.00 100.00 587,771.00 2,461,104.32 100.00 603,616.83
13.1.4 There has no major impairment allowance of accounts receivable has been recovered/received during current reporting period.
13.1.5 There has no accounts receivable written off during the current reporting period.
13.1.6 There has no accounts receivable owed by entities which own 5% or more of the shares of the Company during the current reporting
period.
13.1.7 There has no accounts receivable from related party during current period.
13.2 Other receivable
13.2.1 Disclosure by classification
Balance as at 31/12/2012
Items
Carrying amount Allowance for bad debt
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Amount % of total Amount % of total
Other receivable belong to individual
significance and individually assessed for 51,109,940.55 23.97 51,109,940.55 100.00
impairment
Other receivable belong to recognition of
impairment allowances by group:
Related party group 155,455,734.86 72.91 0.00 0.00
Age group 6,659,008.94 3.12 146,921.11 2.11
Total of Group 162,114,743.80 76.03 146,921.11 0.09
Other receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 213,224,684.35 100.00 51,256,861.66 24.04
(Continued)
Balance as at 31/12/2011
Items Carrying amount Allowance for bad debt
Amount % of total Amount % of total
Other receivable belong to individual
significance and individually assessed for 54,205,281.87 17.22 51,109,940.55 94.29
impairment
Other receivable belong to recognition of
impairment allowances by group:
Related party group 259,356,157.03 82.39 0.00 0.00
Age group 1,212,166.81 0.39 27,726.20 2.29
Total of Group 260,568,323.84 82.78 27,726.20 0.01
Other receivable belong to individually
insignificant but individually assessed for 0.00 0.00 0.00 0.00
impairment
Total 314,773,605.71 100.00 51,137,666.75 16.25
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13.2.2 Disclosure by age:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age
Amount % of total Amount % of total
Within 1 year 161,623,896.90 75.80 260,482,608.54 82.75
Including: within 6 months 161,082,945.80 75.55 260,330,354.49 82.70
7 months - 12 months 540,951.10 0.25 152,254.05 0.05
1-2 years 457,055.02 0.22 83,715.30 0.03
2-3 years 31,791.88 0.01 0.00 0.00
Over 3years 51,111,940.55 23.97 54,207,281.87 17.22
Total 213,224,684.35 100.00 314,773,605.71 100.00
13.2.3 Allowance for bad debt:
① Other receivables of individual significance and subject to individual impairment assessment
Rate of
Carrying Allowance for
Debtor allowance Reason for allowance
amount bad debt
(%)
Enterprise is in the proceeding of
Jianqiao Securities 12,223,000.00 12,223,000.00 100.00
liquidation bankruptcy
Enterprise is in the proceeding of
Hengxin Securities 29,502,438.53 29,502,438.53 100.00
liquidation bankruptcy
Enterprise is in the proceeding of
Minfa Securities 9,384,502.02 9,384,502.02 100.00
liquidation bankruptcy
Total 51,109,940.55 51,109,940.55 100.00
② Accounts receivable using the age analysis method for measurement of impairment allowances:
Accounts receivable using the age analysis method for measurement of impairment allowances:
Balance as at 31/12/2012 Balance as at 31/12/2011
Age Carrying amount Allowance for bad Carrying amount Allowance for
Amount % of total debt Amount % of total bad debt
Within 1 year 6,168,162.04 92.63 83,319.67 1,126,451.51 92.93 17,354.67
Including: within 6 months 5,627,210.94 84.51 56,272.11 974,197.46 80.37 9,741.97
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6 months - 12 months 540,951.10 8.12 27,047.56 152,254.05 12.56 7,612.70
1-2 years 457,055.02 6.86 45,705.50 83,715.30 6.91 8,371.53
2-3 years 31,791.88 0.48 15,895.94 0.00 0.00 0.00
Over 3years 2,000.00 0.03 2,000.00 2,000.00 0.16 2,000.00
Total 6,659,008.94 100.00 146,921.11 1,212,166.81 100.00 27,726.20
13.2.4 The major impairment allowance of other receivables has been recovered/received during current reporting period
Sum of impairment
Original basis of impairment
Debtors Reason(s) for recover allowance recognised Recovered amount
allowance
before recovered
Bankruptcy liquidation Enterprise is in the proceeding of
Minfa Securities 9,384,502.02 3,095,341.32
repayment liquidation bankruptcy
Total 9,384,502.02 3,095,341.32
13.2.5 There has no other receivable written off during the current reporting period.
13.2.6 There has no other receivable owed by entities which own 5% or more of the shares of the Company during the current reporting period.
13.2.7 Details of top five other receivable:
Relationship with the Carrying amount % of total
Debtors Age
Company as at 31/12/2012 accounts receivable
Shanghai Gujing Jinhao Hotel Management Co. ,
Subsidiary 154,500,000.00 Within 6 months 72.46
Ltd.
Hengxin securities Non-related party 29,502,438.53 Over 3 years 13.84
Jianqiao securities Non-related party 12,223,000.00 Over 3 years 5.73
Minfa securities Non-related party 9,384,502.02 Over 3 years 4.40
Beijing light manufacturing (Group) Co., Ltd. Non-related party 3,000,000.00 Within 6 months 1.41
Total 208,609,940.55 97.84
13.2.8 There has no other receivable balance due from related parties during the current reporting period.
13.3 Long-term equity investments
13.3.1 Disclosure by classification
Carrying amount Current year Current year Carrying amount
Classification
as at 31/12/2011 increase decrease as at 31/12/2012
Investment in subsidiaries 247,991,408.32 19,998,000.00 9,900,000.00 258,089,408.32
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Less: Impairment allowance 0.00 0.00 0.00 0.00
Total 247,991,408.32 19,998,000.00 9,900,000.00 258,089,408.32
13.3.2 Details of long-term equity investments
Measurement Carrying amount Current year Carrying amount
Investee Cost of investment
method as at 31/12/2011 movement as at 31/12/2012
Gujing Sales Cost method 84,864,497.89 84,864,497.89 0.00 84,864,497.89
Hefei Trading Cost method 9,900,000.00 9,900,000.00 -9,900,000.00 0.00
Gujing Glass Cost method 85,793,666.00 65,795,666.00 19,998,000.00 85,793,666.00
Shanghai Gujing Jinhao Cost method 49,906,854.63 49,906,854.63 0.00 49,906,854.63
Gujing Hotel Cost method 648,646.80 648,646.80 0.00 648,646.80
Gujing Transportation Cost method 6,875,743.00 6,875,743.00 0.00 6,875,743.00
Gujing Packaging Cost method 30,000,000.00 30,000,000.00 0.00 30,000,000.00
267,989,408.32
Total 247,991,408.32 10,098,000.00 258,089,408.32
(Continued)
Impairment
Shareholding Voting right Reason for disagreement
Impairment allowance Cash dividend in
Investee between shareholding and
(%) (%) allowance recognised in current year
voting right
current year
Gujing Sales 100.00 100.00 0.00 0.00 556,622,552.59
Hefei Trading 100.00 100.00 0.00 0.00 14,171,979.58
Gujing Glass 100.00 100.00 0.00 0.00 0.00
Shanghai Gujing Jinhao 100.00 100.00 0.00 0.00 0.00
Gujing Hotel 100.00 100.00 0.00 0.00 0.00
Gujing Transportation 100.00 100.00 0.00 0.00 0.00
Gujing Packaging 100.00 100.00 0.00 0.00 0.00
Total 100.00 100.00 0.00 0.00 570,794,532.17
13.3.3 There has no impairment allowance for long-term equity investments
13.4 Revenue and operating costs
13.4.1 General information
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Item Current year Prior year
Principal operating income 2,481,871,826.30 1,917,609,583.10
Other operating income 53,443,771.39 39,554,898.14
Total 2,535,315,597.69 1,957,164,481.24
Principal operating cost 1,180,750,152.74 793,593,712.17
Other operating cost 26,527,784.07 34,268,638.45
Total 1,207,277,936.81 827,862,350.62
13.4.2 Revenues from principal operating activities by products
Current year Prior year
Products
operating revenues operating costs operating revenues Costs
Distilled spirit 2,481,871,826.30 1,180,750,152.74 1,917,609,583.10 793,593,712.17
Total 2,481,871,826.30 1,180,750,152.74 1,917,609,583.10 793,593,712.17
13.4.3 Principal operating activities by territories
Current year Prior year
Area
operating revenues operating costs operating revenues operating costs
Middle of mainland 2,476,675,398.93 1,179,278,803.47 1,914,570,360.40 792,861,838.36
International 5,196,427.37 1,471,349.27 3,039,222.70 731,873.81
Total 2,481,871,826.30 1,180,750,152.74 1,917,609,583.10 793,593,712.17
13.4.4 Operating income from top five customers
Year Operating income % of total operating income
2012 2,512,094,975.22 99.08
2011 1,911,340,585.72 97.65
13.5 Investment income
13.5.1 Detail of investment income
Item Current year Prior year
Income from long-term equity investments measured at cost 570,794,532.17 363,057,695.16
Income from holding of financial assets held for trading 0.00 7,952,929.36
Total 570,794,532.17 371,010,624.52
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13.5.2 Income from long-term equity investments measured at cost
Investee Current year Prior year
Gujing Sales 556,622,552.59 361,371,205.06
Hefei Trading 14,171,979.58 1,686,490.10
Total 570,794,532.17 363,057,695.16
13.6 Supplementary information to the statement of cash flows
Category Current year Prior year
① Reconciliation of cash flows from operating activities to net profit:
Net profit
716,666,671.34 497,871,069.01
Add: Loss on asset impairment 1,251,054.50 -6,252,359.76
Depreciation of fixed assets, oil and gas assets, biological assets held for production 29,326,801.07 20,334,221.18
Amortisation of intangible asset 2,744,049.39 2,226,930.48
Amortisation of long-term deferred expenses 4,574,160.85 989,698.98
Amortisation of investment property 2,703,228.15 3,537,860.03
Loss on non-current assets disposal (gain presented by "-" prefix) -424,108.26 -197,160.24
Loss on scrap of fixed assets (gain presented by "-" prefix) 567,010.97 467,406.18
Loss on fair value changes (gain presented by "-" prefix) 0.00 0.00
Financial costs (gain presented by "-" prefix) 0.00 0.00
Investment loss (gain presented by "-" prefix) -570,794,532.17 -371,010,624.52
Decrease of deferred tax assets (increase presented by "-" prefix) 1,670,742.05 1,020,722.13
Increase of deferred tax liabilities (increase presented by "-" prefix) 0.00 0.00
Decrease of inventories (increase presented by "-" prefix) -203,488,199.77 -128,101,562.29
Decrease of operating receivables (increase presented by "-" prefix) 342,206,537.07 -428,193,878.47
Increase of operating payables (decrease presented by "-" prefix) 240,787,983.12 632,358,586.18
Others -1,990,582.13 -961,499.80
Net cash flows generated from operating activities 565,800,816.18 224,089,409.09
② Significant investing and financing activities involve no cash:
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
Debt-to-capital conversion 0.00 0.00
Convertible loan due within one year 0.00 0.00
Fixed assets acquired under financial lease 0.00 0.00
③ Movement of cash and cash equivalents:
Cash as at 31/12/2012 2,290,346,607.43 1,885,937,555.53
Less: Cash as at 31/12/2011 1,885,937,555.53 480,737,398.56
Add: Cash equivalents as at 31/12/2012 0.00 0.00
Less: Cash equivalents as at 31/12/2011 0.00 0.00
Net increase of cash and cash equivalents 404,409,051.90 1,405,200,156.97
Note 14: Supplementary information
14.1 Non-recurring profit and loss
Category Current year Prior year
Gains from disposals of non-current assets after expending impairment provisions 465,158.50 186,246.05
Exceeded-authority approved, non-official approved or accidental tax repayment and
0.00 0.00
relief
Government grants recognised through profit or loss for the current reporting period,
excluding grants which are closely related to the Company’s operating activities and of
5,871,645.90 4,111,902.86
which the quota or approval is eligible for automatic renewal in accordance with relevant
regulations
Financial resource usage fees charged on non-financial institution recognised through
0.00 0.00
profit or loss for the current reporting period
Gains arising from bargain purchase in business combination and investments in
0.00 0.00
associates and joint ventures
Non-monetary asset exchange 0.00 0.00
Consigned investment and asset management 0.00 0.00
Impairment provision resulting from force majeure, eg. natural desasters 0.00 0.00
Debt reorganisation 0.00 0.00
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Category Current year Prior year
Entity eorganisation expenditure 0.00 0.00
Unfair transactions 0.00 0.00
Net profits or losses achieved by an acquired under-common-control entity during the
0.00 0.00
period from the start of the period to the acquisition date
Gains or losses arising from contingent events unconnected with the Company’s daily
0.00 0.00
operating activities
Fair value changes of tradable financial assets and tradable financial liabilities held
and gains or losses arising from disposals of tradable financial assets, tradable financial
0.00 0.00
liabilities and available-for-sale financial assets, excluding hedging contracts relevant to the
Company’s daily operating activities
Reversal of impairment provision for accounts receivables eligible for individual
0.00 4,106,508.26
impairment assessment
Gains or losses arising from consigned borrowings 0.00 0.00
Fair value changes of property investments subsequently measured at fair value 0.00 0.00
One-off adjustment of profit or loss for the current reporting period in accordance with
0.00 0.00
tax and accounting laws and regulations
Consignment income arising from consigned operations 0.00 0.00
Income and expenses other than items listed above 12,188,577.39 9,993,800.13
Other gains or losses satisfying the definition of extraordinary gains or losses 0.00 0.00
Subtotal 18,525,381.79 18,398,457.30
Less: Impact of income tax 4,870,884.23 5,575,263.62
Less: Impact on non-controlling interest 0.00 0.00
Total 13,654,497.56 12,823,193.68
Note: Positive amounts and negative amounts in non-recurring categories mean income and expense or loss respectively.
The Company recognised non-recurring categories of activities in accordance with the Explanatory Announcement regarding Information Disclosure
by Publicly Listed Company No. 1 - Non-recurring Profit and Loss (Zhengjianhui Gonggao [2008] No.43).
14.2 Rate of return on net assets and earnings per share
Weighted average rate of Earnings per share (CNY/share)
Profit catetory
RONA Basic EPS Diluted EPS
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2012 Annual Report of Anhui Gujing Distillery Company Limited
Weighted average rate of Earnings per share (CNY/share)
Profit catetory
RONA Basic EPS Diluted EPS
Net profit attributable to ordinary shareholders 23.80 1.44 1.44
Recurring profit or loss attributable to ordinary
23.35 1.41 1.41
shareholders
Note: The calculation of Basic EPS and Diluted EPS please see Note 7.38.
14.3 Significant change of major element of the consolidated financial statements
14.3.1 Elements of the consolidated statement of financial position
14.3.1.1 Monetary funds amounting to CNY 2,609,650,352.09 as at the reporting date: 25.34% increase from last year mainly resulted from
recovery of accounts receivable.
14.3.1.2 Notes receivable amounting to CNY 156,449,495.65 as at the reporting date: 68.11% decrease from last year mainly resulted from
bankers' acceptances maturing collection.
14.3.1.3 Accounts receivables amounting to CNY 7,887,007.25 as at the reporting date: 79.07% decrease from last year mainly resulted from the
company strengthen the accounts receivable management and collection of overdue receivables in time.
14.3.1.4 Advances to suppliers amounting to CNY 85,305,973.47 as at the reporting date: 63.43% decrease from last year mainly resulted from the
advance payment for purchase of equipment, land acquisition compensation, purchase of house in last year
14.3.1.5 Interest receivables amounting to CNY 7,253,858.34 as at the reporting date: 62.95% increase from last year mainly resulted from
increase of monetary funds transferred into bank saving deposit.
14.3.1.6 Other receivables amounting to CNY 21,559,146.98 as at the reporting date: 1.73 times increase from last year mainly resulted from
increase of prepayments of adverting fee during current year.
14.3.1.7 Inventories amounting to CNY 782,399,498.85 as at the reporting date: 35.33% increase from last year mainly resulted from increase input
to additional production facilities in Gujing industrial park.
14.3.1.8 Fixed assets amounting to CNY 783,740,205.15 as at the reporting date: 1.16 times increase from last year mainly resulted from part of
the projects and equipments ready for use and transferred into fixed assets.
14.3.1.9 Construction in progress amounting to CNY 423,672,281.54 as at the reporting date: 2.19 times increase from last year mainly resulted
from the company’s self investment project have started construction.
14.3.1.10 Long-term deferred charge amounting to CNY 30,959,542.67 as at the reporting date: 2.2 times increase from last year mainly resulted
from the expense of the part of investment projects transferred into long-term deferred expenses.
14.3.1.11 Accounts payable amounting to CNY 461,112,575.26 as at the reporting date: 1.10 times increase from last year mainly resulted from
increase of expand the scale of production, increase in procurement, project payment.
14.3.1.12 Taxes and fees payable amounting to CNY 645,410,021.57 as at the reporting date: 3.83% decrease from last year mainly resulted from
decreased taxes on revenue and tax surcharges due to decreased revenue at the year-end.
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2012 Annual Report of Anhui Gujing Distillery Company Limited
14.3.1.13 Other payable amounting to CNY 297,098,777.98 as at the reporting date: 19.37% increase from last year mainly resulted from increase
of the margin deposit received from dealers.
14.3.1.14 Share capital amounting to CNY 503,600,000.00 as at the reporting date: 1 time increase from last year mainly resulted from capital
reserve transferred into share capital.
14.3.2 Elements of the consolidated statement comprehensive income and the consolidated statement of cash flows
14.3.2.1 Revenue amounting to CNY 4,197,057,315.26 for the period: 26.88% increase from last year mainly resulted from increase of sales.
14.3.2.2 Cost amounting to CNY 1,220,831,141.50 for the period: 41.79% increase from last year mainly resulted from increase of sales, labor
costs and raw material costs.
14.3.2.3 Sales expenses amounting to CNY 1,075,977,234.87 for the period: 34.82% increase from last year mainly resulted from strengthen
promotional efforts, increase labor fees, promotional fees and advertising fees.
14.3.2.4 Financial costs amounting to CNY -88,430,981.17 for the period: CNY 36,559,577.02 decrease from last year mainly resulted from
increase of bank charges, and increase of interest income of fixed deposits and structured deposits
14.3.2.5 Impairment loss on assets amounting to CNY 2,804,328.23 for the period: 3.06 times increase from last year mainly resulted from
recognition of impairment allowance of inventories, impairment allowance of intangible assets.
Section XI. Documents Available for Reference
1. The accounting statements with personal signatures and seals of Legal Representative, Chief Accountant and the person in charge
of the accounting agency (Accountant in charge).
2. The original of the Auditor’s Report with the seals of the CPA firm, as well as the signatures and seals of the registered
accountants.
3. The originals of all the documents and public notices disclosed on China Securities Journal and Ta Kung Pao by the Company
during the reporting period.
4. Other relevant documents.
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