ANHUI GUJING DISTILLERY COMPANY LIMITED
2014 Annual Report
April 2015
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section I. Important Reminders & Explanation
Important Reminders
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 is factual, accurate and complete without any false record, misleading
statement or material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company’s profit distribution preplan upon review and approval of this board session: Based
on the total shares of the Company as at 31 Dec. 2014, a cash dividend of RMB 2.00 (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.
Liang Jinhui, company principal, Ye Changqing, chief of the accounting work, and Zhu Jiafeng,
chief of the accounting organ (chief of accounting), hereby confirm that the Financial Report
enclosed in this report is factual, accurate and complete.
This report involves futures plans and some other forward-looking statements, which shall not be
considered as virtual promises to investors. Investors are kindly reminded to pay attention to
possible risks.
2
2014 Annual Report of Anhui Gujing Distillery Company Limited
Catalogue
Section I. Important Reminders & Explanation ............................................................................. 2
Section II. Company Profile .............................................................................................................. 6
Section III. Accouonting & Financial Indicator Highlights ........................................................... 8
Section IV. Report of the Board of Directors ................................................................................ 11
Section V. Significant Events .......................................................................................................... 33
Section VI. Changes in Shares & Shareholders ............................................................................ 37
Section VII. Directors, Supervisors, Senior Management Staff & Employees .......................... 44
Section VIII. Corporate Governance ............................................................................................. 52
Section IX. Internal Control ........................................................................................................... 57
Section X. Financial Report ............................................................................................................ 59
Section XI. Documents Available for Reference ......................................................................... 160
3
2014 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
4
2014 Annual Report of Anhui Gujing Distillery Company Limited
Reminder of Major Risks
1. We have disclosed in this report the major risk factors that may prevent us from fulfilling our
future development strategies and operating goals. Please refer to the possible risks in the outlook of
the future development of the Company in the Report of the Board of Directors in this report.
2. 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.
3. This report is prepared in both Chinese and English. Should there be any understanding
discrepancy between the two versions, the Chinese version shall prevail.
5
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section II. Company Profile
I. Company information
Stock abbreviation GJGJ, GJGB Stock code 000596, 200596
Stock abbreviation after
change (if any)
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
Liang Jinhui
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. Contact us
Company Secretary Securities Affairs Representative
Name Ye Changqing Ma Junwei
Gujing Town, Bozhou City, Anhui Gujing Town, Bozhou City, Anhui
Address
Province Province
Tel. (0558) 5712231 (0558) 5710057
Fax (0558) 5317706 (0558) 5317706
E-mail ycq@gujing.com.cn gjzqb@gujing.com.cn
6
2014 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 disclosing
http://www.cninfo.com.cn
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 May 2014 Administration 340000400001632 341600151940008 15194000-8
reporting period
Bureau of Anhui
Province
Changes of the main business since listing
Unchanged
(if any)
Changes of the controlling shareholder (if
Unchanged
any)
V. Other information
The CPAs firm hired by the Company:
Name Ruihua Certified Public Accountants LLP
5-11 F, West Tower, China Overseas Property Plaza, Building No. 7, Courtyard No. 8, Xi
Office address
Binhe Road, Yong Ding Men, Dong Cheng District, Beijing, China
Signing accountants Yang Ganlin, Chen Lianwu
Sponsor engaged by the Company to conduct sustained supervision during the reporting period
□ Applicable √ Inapplicable
Financial consultant engaged by the Company to conduct sustained supervision during the reporting period
□ Applicable √ Inapplicable
7
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section III. Accounting & Financial Indicator Highlights
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
2014 2013 this year over last year 2012
(%)
Operating revenues (RMB Yuan) 4,650,855,881.72 4,580,575,654.71 1.53% 4,197,057,315.26
Net profit attributable to
shareholders of the Company 597,041,887.34 622,004,915.79 -4.01% 725,589,286.31
(RMB Yuan)
Net profit attributable to
shareholders of the Company after
568,353,541.08 593,950,787.12 -4.31% 711,934,788.75
extraordinary gains and losses
(RMB Yuan)
Net cash flows from operating
387,494,289.89 638,255,355.31 -39.29% 1,086,867,364.46
activities (RMB Yuan)
Basic EPS (RMB Yuan/share) 1.19 1.24 -4.03% 1.44
Diluted EPS (RMB Yuan/share) 1.19 1.24 -4.03% 1.44
Weighted average ROE (%) 15.05% 17.47% -2.42% 23.80%
Increase or decrease of
As at 31 Dec. 2014 As at 31 Dec. 2013 this year-end than last As at 31 Dec. 2012
year-end (%)
Total assets (RMB Yuan) 6,413,518,166.03 5,816,934,562.27 10.26% 5,308,127,471.04
Net assets attributable to
shareholders of the Company 4,181,050,977.96 3,742,756,257.05 11.71% 3,375,488,108.64
(RMB Yuan)
Number of the Company’s total shares in the trading day before disclosure of this report:
Number of the Company’s total shares in the trading day
503,600,000
before disclosure of this report
8
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
□ Applicable √ Inapplicable
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
□ Applicable √ Inapplicable
III. Items and amounts of extraordinary gains and losses
√ Applicable □ Inapplicable
Unit: RMB Yuan
Item 2014 2013 2012 Note
Gains/losses on the disposal of non-current
assets (including the offset part of the asset -2,134,348.70 -1,394,990.98 465,158.50
impairment provisions)
Government grants recognized in the current
period, except for those acquired in the
ordinary course of business or granted at 6,045,394.97 6,438,091.17 5,871,645.90
certain quotas or amounts according to the
government’s unified standards
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
17,233,109.00 10,050,415.19
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 382,500.00
carried out separately
Non-operating income and expense other
16,729,758.11 22,311,989.53 12,188,577.39
than the above
Less: Income tax effects 9,568,067.12 9,351,376.24 4,870,884.23
Minority interests effects (after tax)
Total 28,688,346.26 28,054,128.67 13,654,497.56 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
9
2014 Annual Report of Anhui Gujing Distillery Company Limited
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √ Inapplicable
10
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section IV. Report of the Board of Directors
I. Overview
In the reporting period, in face of complicated economic situations and downward economies at home and abroad
as well as a severe season for the main business of distilled spirit, the Board of Directors of the Company, upon
common efforts of the new management team and all the staff, upheld the values of Gujing people of “be honest,
make good wine, make ourselves better and make the world better”, regained faith and confidence, solidified the
main business and kept innovating. As a result, all budgetary objectives for 2014 were successfully fulfilled.
For 2014, the Company achieved operating revenues of RMB 4,650,855,881.72，up 1.53% over last year; total
profit of RMB 796,204,507.14, down 6.54% over last year; net profit of RMB 597,041,887.34, down 4.01% over
last year; EPS of RMB 1.19/share, down 4.03% over last year; and net operating cash flows of RMB
387,494,289.89, down 39.29% over last year. The production and operating indicators set at the beginning of the
year were all fulfilled and the Company was in good production and operation.
II. Main business analysis
1. Overview
(I) The marketing model was reformed and the sales volume kept increasing.
1. Lean marketing was carried out. In face of pressure in marketing, we closely adhered to the strategic objectives,
upheld the guiding principles of “stability = growth, no decrease in prices = increase” and “downsizing & power
decentralization”, and carried out lean marketing according to “work on dynamic marketing, de-stock, keep prices
and stabilize channels”.
2. Brand promotion was continuously enhanced. According to the “top-end & internationally and domestically
famous” brand strategy, we gathered our brand power and continued to promote our brand by a series of activities
such as a global tour of Gujing Spirit, sponsoring Snooker games, the Most Touching Chinese Awards, the
Awards for the News Figures Who Touch the Heart of Anhui, and the 5th Anniversary for the Launch of Vintage
Original Gujing Spirit & 2014 Annual Distributor Strategic Communication.
3. The product system was optimized. In the reporting period, according to market needs, we upgraded the spirit
quality and package for the Vintage Original Gift edition, the Outside-Anhui Happiness edition and 5 vintage
originals.
4. We proactively explored new marketing models. In the reporting period, we enhanced and accelerated internet
marketing by setting up the Internet Business Center as well as official flagship stores on Tmall, Taobao and JD,
an official online shopping mall on our official website, and other direct sale and distribution channels.
5. Our market system was safeguarded in an all-round manner. We continued to optimize the organizational
structure of marketing and the three tiers of KPI appraisal and enhance our effort in expense audit and
anti-counterfeit so as to ensure the efficient operation of our market system.
(II) The production capacity structure was optimized, R&D was enhanced and the product quality kept improving.
1. The product quality guarantee system became more solid. We had a quality control team of nearly 100 staff.
Meanwhile, the internationally advanced large-scaled equipment for liquor quality testing and analysis previously
brought in were all put into use, leaving no effort spared in safeguarding the efficient operation of our quality
11
2014 Annual Report of Anhui Gujing Distillery Company Limited
control system.
2. Preliminary results were achieved in promotion of standardized operation. The Company was selected as one of
the “(First) Example Enterprises in Standardization in the Industrial and Informatization Field in Anhui Province”.
The state-level lab set up by us officially passed the certification. And the academician workstation and the
postdoctoral research station were completed as scheduled.
(III) Internal management was enhanced and the operational and managerial capability kept improving.
1. Activities for the “Year of Human Resource Improvement” were effectively carried out. 2014 had been set to
be a “Year of Human Resource Improvement” for the Company. We improved our human resource management
mechanism, further optimized our organizational structure and position system, and successfully kicked off
establishment of the career path.
2. We enhanced internal control, increased income and reduced expenditure, and increased the capital utilization
efficiency. In the reporting period, we further deepened cost control and formulated a systematic plan for cost
control. Beginning with internal control audit, we strictly audited expense on marketing, engineering projects, etc.
As such, quite a few costs were effectively controlled.
(IV) We enhanced corporate culture improvement and improved our brand image.
Since taking office, the new management team put forward, on the path of adhering to leapfrog development, a
series of new concepts such as “return to the top level of the distilled spirit industry”, a greater goal of building a
“manufacture empire” and core values of “be honest, make good wine, make ourselves better and make the world
better”. The atmosphere and ecology of the Company became healthier. The campaign of “new environment, new
atmosphere, new driving force and new achievements” started to yield results. A favorable internal environment
characteristic of “fair and righteous atmosphere, staff and operation” was created, urging every employee to
become an executor and spreader of Gujing’s contribution culture.
(V) Judging from the operation in the reporting period, we still need to work on the following:
1. Our existing organizational structure and human resources cannot keep up with our strategic development and
are facing adjustment.
2. As the Company grows bigger, market competition becomes fiercer and cost pressure in management,
production, procurement, human resources, etc. is building up. We need to exploit our potential in a deeper
manner and increase the economic benefits.
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
Changes in the main operational model
□ Applicable √ Inapplicable
2. Revenues
For 2014, we sold 66.6 thousand tons of distilled spirit, up 3.38% from the year earlier; and we achieved operating revenues of RMB
4.651 billion, up 1.53% year on year, and net profits attributable to shareholders of the Company of RMB 597 million, down 4.01%
year on year.
Are the Company’s goods selling revenue higher than the service revenue?
√ Yes □ No
Industry Item Unit 2014 2013 YoY +/-
Distilled spirit Sales volume Ton 66,608.13 64,427.29 3.38%
12
2014 Annual Report of Anhui Gujing Distillery Company Limited
brewage Output Ton 65,680.19 66,309.2 -0.95%
Stock Ton 2,987.13 3,915.07 -23.70%
Reasons for any over-30% YoY movement of the data above:
□ Applicable √ Inapplicable
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) 1,216,261,023.53
Ratio of the total sales to the top 5 customers to the
26.15%
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 470,825,726.23 10.12%
2 Distributor B 321,104,908.41 6.90%
3 Distributor C 282,787,375.85 6.08%
4 Distributor D 94,548,801.96 2.03%
5 Distributor E 46,994,211.08 1.01%
Total -- 1,216,261,023.53 26.15%
Other information about major customers:
□ Applicable √ Inapplicable
3. Costs
Classified by industry:
Unit: RMB Yuan
2014 2013
Industry Item Proportion in Proportion in YoY +/-
Amount Amount
operating costs operating costs
Food
Direct materials 1,041,435,552.23 73.01% 978,021,881.81 72.53% 6.48%
manufacturing
Food
Direct labor cost 147,507,978.36 10.34% 133,456,697.33 9.90% 10.53%
manufacturing
Food Manufacturing
101,989,180.53 7.15% 93,924,997.50 6.97% 8.59%
manufacturing expenses
13
2014 Annual Report of Anhui Gujing Distillery Company Limited
Food
Fuel-power 83,662,436.07 5.87% 80,318,500.09 5.96% 4.16%
manufacturing
Classified by product:
Unit: RMB Yuan
2014 2013
Product Item Proportion in Proportion in YoY +/-
Amount Amount
operating costs operating costs
Distilled spirit
1,374,595,147.19 96.37% 1,285,722,076.73 95.35% 6.91%
products
Hotel revenue 41,303,525.82 2.90% 38,970,804.86 2.89% 5.99%
Others 10,460,416.70 0.73% 23,680,998.95 1.76% -55.83%
Major suppliers:
Total purchases from the top 5 suppliers (RMB Yuan) 408,499,592.87
Ratio of the total purchases from the top 5 suppliers to the
39.47%
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 190,276,478.21 18.38%
2 Supplier B 63,477,601.48 6.13%
3 Supplier C 56,504,876.15 5.46%
4 Supplier D 50,903,016.80 4.92%
5 Supplier E 47,337,620.23 4.57%
Total -- 408,499,592.87 39.47%
Other information about major suppliers:
□ Applicable √ Inapplicable
4. Expense
Naught
14
2014 Annual Report of Anhui Gujing Distillery Company Limited
5. R&D expenses
The R&D expenses in the reporting period stood at RMB 152,792,000, accounting for 3.65% of the net assets and 3.29% of the
operating revenues.
6. Cash flows
Unit: RMB Yuan
Item 2014 2013 YoY +/-
Subtotal of cash inflows from
5,470,924,405.02 5,681,044,259.07 -3.70%
operating activities
Subtotal of cash outflows from
5,083,430,115.13 5,042,788,903.76 0.81%
operating activities
Net cash flows from operating
387,494,289.89 638,255,355.31 -39.29%
activities
Subtotal of cash inflows from
2,383,026,644.60 948,305,978.93 151.29%
investing activities
Subtotal of cash outflows from
3,218,831,202.66 2,437,480,975.37 32.06%
investing activities
Net cash flows from investing
-835,804,558.06 -1,489,174,996.44 43.87%
activities
Subtotal of cash outflows from
176,260,000.00 251,800,000.00 -30.00%
financing activities
Net cash flows from financing
-176,260,000.00 -251,800,000.00 30.00%
activities
Net increase in cash and cash
-624,570,268.17 -1,102,719,641.13 43.36%
equivalents
Reasons for any over-30% YoY movement of the data above:
√ Applicable □ Inapplicable
1. Net cash flows from operating activities stood at RMB 387,494,289.89 for the reporting period, down 39.29% from last year,
which was mainly because the taxes paid by the Company and the proportion of note payments by customers increased.
2. Cash inflows from investing activities stood at RMB 2,383,026,644.60 for the reporting period, up 151.29% from last year, which
was mainly because the principals of due bank wealth management products were recovered.
3. Cash outflows from investing activities stood at RMB 3,218,831,202.66for the reporting period, up 32.06% from last year, which
was mainly because the investment expense on purchasing bank wealth management products and stocks increased.
4. Net cash flows from financing activities stood at RMB -176,260,000.00 for the reporting period, down 30% from last year, which
was mainly because the cash dividends distributed in the current period decreased.
Reasons for a big difference between the operating cash flows and the net profit:
□ Applicable √ Inapplicable
15
2014 Annual Report of Anhui Gujing Distillery Company Limited
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease
Increase/decrease Increase/decrease
Operating of operating
Operating costs Gross profit rate of operating costs of gross profit
revenues revenues over last
over last year rate over last year
year
Classified by industry
Manufacture 4,612,235,437.15 1,426,359,089.71 69.07% 1.57% 5.78% -1.23%
Classified by product
Distilled spirit
4,525,663,475.64 1,374,595,147.19 69.63% 1.96% 6.91% -1.41%
products
Hotel revenue 76,460,229.81 41,303,525.82 45.98% 5.09% 5.99% -0.46%
Other 10,111,731.70 10,460,416.70 -3.45% -65.73% -55.83% -23.18%
Classified by region
North China 375,113,132.66 150,943,951.66 59.76% -3.43% 26.51% -9.52%
Central China 3,593,793,057.50 1,064,736,548.39 70.37% 1.83% 2.60% -0.22%
Southern China 641,172,562.92 210,129,418.65 67.23% 3.24% 10.16% -2.06%
Overseas 2,156,684.07 549,171.01 74.54% 3.52% 2.12% 0.35%
Under the circumstances that the statistical standards for the Company's main business data adjusted in the Reporting Period, the
Company's main business data in the recent year is calculated based on adjusted statistical standards at the end of the Reporting
Period
□ Applicable √ Inapplicable
IV. Analysis of Assets and Liabilities
1. Material changes of asset items
Unit: RMB Yuan
As at 31 Dec. 2014 As at 31 Dec. 2013
Proportion
Proportion in Proportion in Explain any major change
Amount Amount change
total assets total assets
718,460,442.7 1,381,930,710.
Monetary funds 11.20% 23.76% -12.56%
9 96
Accounts
4,337,953.26 0.07% 6,374,469.99 0.11% -0.04%
receivable
1,227,182,774. 1,075,033,137.
Inventories 19.13% 18.48% 0.65%
09 30
Investing real 32,074,356.24 0.50% 35,188,079.66 0.60% -0.10%
16
2014 Annual Report of Anhui Gujing Distillery Company Limited
estate
1,724,134,467. 1,266,481,752.
Fixed assets 26.88% 21.77% 5.11%
11 59
Construction in
61,637,510.96 0.96% 377,338,939.54 6.49% -5.53%
process
2. Significant changes in liabilities
Naught
3. Assets and liabilities measured at fair value
√ Applicable □ Inapplicable
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
1. Financial
assets
measured by
fair value with
the changes be
included in the
0.00 121,035.00 182,884.60 0.00 303,919.60
current gains
and losses
(excluding the
derivative
financial
assets)
2. Derivative
financial assets
3. Financial
assets available 24,075,687.00 22,226,138.76 43,106,793.24 24,075,687.00 65,332,932.00
for sale
Total of the
24,075,687.00 121,035.00 22,226,138.76 43,289,677.84 24,075,687.00 65,636,851.60
above
Whether the measurement attributes of the main assets of the Company had significant changes during the reporting period or not?
□ Yes √ No
17
2014 Annual Report of Anhui Gujing Distillery Company Limited
4. List of main foreign assets
□ Applicable √ Inapplicable
V. Analysis to the core competitiveness
During the reporting period, there was no significant change of the core competitiveness of the Company.
VI. Analysis to the investment situation
1. Particulars about external equity investment
(1) Particulars about external investment
□ Applicable √ Inapplicable
(2) Particulars about holding equity of financial enterprises
□ Applicable √ Inapplicable
(3) Particulars about securities investment
√ Applicable □ Inapplicable
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)
Financial
Ping An 17,080,74 25,388,35 assets Self-own
Stock 000001 0 0.00% 1,602,800 0.014%
Bank 0.10 2.00 available- ed funds
for-sale
Financial
26,026,05 39,944,58 assets Self-own
Stock 601988 BOC 0 0.00% 9,625,200 0.003%
3.14 0.00 available- ed funds
for-sale
Other securities investment held
-- -- -- --
at the period-end
43,106,79 11,228,00 65,332,93
Total 0 -- -- 0 -- --
3.24 0 2.00
Disclosure date of the board
announcement on securities
18
2014 Annual Report of Anhui Gujing Distillery Company Limited
investment approval
Disclosure date of the general
meeting announcement on
securities investment approval
(if any)
(4) Explanation on holding equity of other listed companies
□ Applicable √ Inapplicable
2. Entrusted financial management, derivatives investment and entrustment loans
(1) Entrusted financial management
□ Applicable √ Inapplicable
(2) Derivatives investment
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Proportio
n of the
closing Actual
Related-p Type of Impairme
Initial Opening Closing investmen gain/loss
arty derivative Ending nt
Operator Relation investmen Start date investmen investmen t amount in
transactio investmen date provision
t amount t amount t amount in the reporting
n or not t (if any)
Company period
’s closing
net assets
Reverse
repurchas
2 Jan.
No e of 0 8,000 18,071.22 4.32% 479.24
2014
national
debt
Total 0 -- -- 8,000 18,071.22 4.32% 479.24
Capital source for derivative investment Self-owned idle funds.
Cases involving lawsuit (if
Naught
applicable)
Disclosure date of the board announcement
approving the wealth management 30 Aug. 2013
entrustment (if any)
Disclosure date of the general meeting
19
2014 Annual Report of Anhui Gujing Distillery Company Limited
announcement approving the wealth
management entrustment (if any)
Analysis on risks and control measures of
derivative products held in the reporting
The Company had controlled the relevant risks strictly according to the Derivatives
period (including but not limited to market
Investment Management System.
risk, liquidity risk, credit risk, operation
risk, law risk, etc.)
Changes of market prices or fair values in
the reporting period of the invested
derivatives. And the analysis on the fair
Naught
value of the derivatives should include the
specific use methods and the relevant
assumptions and parameters.
Whether significant changes occurred to
the Company’s accounting policy and
specific accounting principles of Naught
derivatives in the reporting period
compared to the previous reporting period
Based on the sustainable development of the main business and the sufficient free idle
money, the Company increased the profits through investing in the reasonable financial
derivative instruments, which was in favor of improving the service efficiency of the
idle funds; in order to reduce the investment risks of the financial derivative
instruments, the Company had set up corresponding supervision mechanism for the
Specific opinion from independent
financial derivative instrument business and formulated reasonable accounting policy
directors on the Company’s derivatives
as well as specific principles of financial accounting; the derivative Investment
investment and risk control
business developed separately took national debts as mortgage object, which was met
with the cautious and steady risks management principle and the interest of the
Company and shareholders. Therefore, agreed the Company to develop the derivative
Investment business of reverse repurchase of national debt not more than the limit of
RMB 0.3 billion.
(3) Entrustment loans
□ Applicable √ Inapplicable
3. Particulars about the use of raised funds
√ Applicable □ Inapplicable
(1) Overview of the use of raised funds
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
20
2014 Annual Report of Anhui Gujing Distillery Company Limited
Total amount of raised funds 122,749.95
Total amount of raised funds input in the reporting
9,599.37
period
Total amount of raised funds accumulatively input 104,156.09
Total amount of the raised funds which modified the
purposes during the reporting period
Total amount of the accumulative raised funds which
modified the purposes
Proportion of the total amount of the accumulative
raised funds which modified the purposes
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
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
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
Cannot b
Technological e calculat
Transform on the 30 Apr.
Brewage of No 13,500 12,194.42 2,467.92 11,770.16 96.52% ed separa No
High-quality Base 2014
tely
Wine
Cannot b
Construction of Base e calculat
Wine Blending & 30 Apr.
No 68,600 65,921.06 6,122.17 57,403.52 87.08% ed separa No
Filling Centre and 2014
Ancillary Facilities tely
Cannot b
Construction of 30 Apr. e calculat
No 27,500 27,500 1,009.28 17,957.35 65.30% No
Marketing Network 2014 ed separa
tely
21
2014 Annual Report of Anhui Gujing Distillery Company Limited
Cannot b
e calculat
Construction of Brand 31 Dec.
No 17,000 17,000 0 17,025.06 100.15% ed separa No
Promotion 2012
tely
Subtotal of promised 122,615.4 104,156.0
-- 126,600 9,599.37 -- -- -- --
investment projects 8 9
Investments of over-raised capital
Repayment of the bank
-- -- -- -- --
loan (if any)
Supplement of the
circulating fund (if -- -- -- -- --
any)
Subtotal of the
investments of -- -- -- 0 -- --
over-raised capital
122,615.4 104,156.0
Total -- 126,600 9,599.37 -- -- 0 -- --
8 9
Reason for failing to
reach scheduled
progress or projected
income (explain one
project by one project)
Explanation on
significant changes in Naught
feasibility of projects
Amount, usage and Inapplicable
usage progress of
over-raised capital
Change of the Inapplicable
implementation
location of any raised
funds investment
project
Adjustment of the Inapplicable
implementation method
of any raised funds
investment project
Advanced input and Applicable
22
2014 Annual Report of Anhui Gujing Distillery Company Limited
exchange of any raised In accordance with the explanation of the Particulars on the Private Issuance of A-share of Anhui Gujing
funds investment Distillery Co., Ltd. and the Listing Announcement, “Before the raised proceeds being in place, the
project 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 RMB 27,058,143.42 preliminarily input to the
raised proceeds investment projects. The above funds replacement was completed on 6 Jan. 2012.
Idle raised capital for Inapplicable
temporarily
supplementing working
capital
Applicable
1. The Company strictly carried out the purchase system and the project bidding way, which better
controlled the project construction and purchase cost and under the premise of guaranteeing the project
Outstanding raised quality with the principles of practicing strict economy, the Company further strengthened the project
funds in project expenses control, supervisor and management in the process of the execution which reduced the total cost
implementation and of the investment project of the raised funds. 2. The surplus reason of the marketing network construction
reasons project was due to the rather big changes of the liquor market environment and the third party logistics
system gradually becoming more and more mature and at the same time, the Company would no more
execute the center project of Hefei Logistics for reducing the fixed operating cost of the Company, which
caused the capital surplus of the project.
Usage and whereabouts
Deposited in the special account for raised proceeds.
of unused raise capital
Problems found in the
usage and disclosure
N/A
affairs of raised capital
and other situations
(3) Change of projects invested with raised funds
□ Applicable √ Inapplicable
4. Analysis to main subsidiaries and stock-participating companies
√ Applicable □ Inapplicable
Main subsidiaries and stock-participating companies
Unit: RMB Yuan
Main
Company Company Registered Operating Operating
Industry products/ser Total assets Net assets Net profit
name variety capital revenues profit
vices
23
2014 Annual Report of Anhui Gujing Distillery Company Limited
Wholesales
of distilled
Bozhou spirit,
Gujing Business constructio 84,864,497. 1,414,256,3 161,657,67 4,525,137,3 593,174,31 461,431,97
Subsidiary
Sales Co., trading n materials, 89 47.25 7.00 38.29 8.12 1.28
Ltd feeds and
assistant
materials
Bozhou Manufactur
Gujing Manufactur e and sale 86,660,268. 176,004,15 141,988,85 211,572,40 26,748,621. 20,076,148.
Subsidiary
Glass Co., e of glass 98 6.88 8.89 0.59 32 36
Ltd products
Collect and
Bozhou
sale of
Gujing
Waste recycled 1,000,000.0 1,671,647.9 1,268,732.1 6,922,572.7
Waste Subsidiary -44,063.50 -59,696.81
recycle glass bottle, 0 0 1 6
Reclamatio
glass,
n Co., Ltd
wastebasket
Production,
publish,
design and
proxy of
Anhui ads in
Jinyunlai China;
Ads 2,000,000.0 31,662,224. 2,995,033.3 423,212,13 6,499,394.3 4,887,003.2
Culture & Subsidiary ceremony
marketing 0 36 2 4.55 4 5
Media Co., service for
Ltd. conferences
as well as
sales of
gifts in arts
and crafts
Administrat
ive license
items:
Naught;
Bozhou Production General
Gujing and operating 30,000,000. 37,450,521. 31,074,921. 7,183,453.1 2,661,276.3 1,643,837.9
Subsidiary
Packing manufactur items: 00 64 13 0 4 6
Co., Ltd. e providing
packing for
Gujing
Brand,
serials
24
2014 Annual Report of Anhui Gujing Distillery Company Limited
wine, fruit
and
vegetable
wine, health
wine of
Gujing
Brand
Bozhou Transportati
Gujing Transportati on, sales 6,945,195.6 3,587,200.6 2,475,117.0
Subsidiary 0.00 0.00 0.00
Transportati on and repair 4 0 2
on Co., Ltd service
Hotel
managemen
t (Except
for catering
managemen
t 、 Except
for hotel
operation);
Self-owned
Shanghai housing
Gujing rental;
Hotel
Jinhao establish 54,000,000. 231,501,52 94,016,179. 71,671,628. 7,070,156.0 5,746,971.4
Subsidiary managemen
Hotel branch. (If 00 2.29 33 81 9 7
t
Managemen the
t Co., Ltd. enterprise
operation
involves the
administrati
ve
licensing, it
shall
operate
based on
the license).
Accommod
ation and
Bozhou parking
Hotel
Gujing services; 1,373,303.1 4,792,101.0
Subsidiary managemen 628,000.00 57,304.24 235,725.80 234,534.80
Hotel Co., lunch 7 0
t
Ltd. processing,
sales of
alcohol and
25
2014 Annual Report of Anhui Gujing Distillery Company Limited
tobacco and
sales of
daily
commodity
Research
and
promotion
of the
engineering
and
technology;
information
System
planning
and design;
computer
software
and
hardware,
network
communica
tion system
Anhui
design,
Swisse Will
Technical developmen 50,000,000. 51,552,515. 49,425,543. 3,365,280.6
Science & Subsidiary -574,456.82 -574,456.82
research t and sales; 00 18 18 6
Technology
enterprise
Co., Ltd.
managemen
t consulting
and
services. (If
the
enterprise
operation
involves the
administrati
ve licensing
or
qualificatio
n, it shall
operate
based on
the license
or
qualificatio
26
2014 Annual Report of Anhui Gujing Distillery Company Limited
n)
Anhui Production
Subway Manufactur and sales o
30,000,000. 30,000,000. 30,000,000.
Cordial Subsidiary ing and f other liq 0.00 0.00 0.00
00 00 00
Wine Co., sales uor (compo
Ltd. und wine)
Production,
publish,
design and
Shanghai
proxy of
Hongbang
ads in
Culture Ads 5,000,000.0
Subsidiary China; 0.00 0.00 0.00 234.82 -208.28
Communica marketing 0
ceremony
tion Co.,
service for
Ltd.
conferences
and sales of
craft gifts
Particulars about subsidiaries gained and disposed during the reporting period
√ Applicable □ Inapplicable
Purpose for acquiring or Way of acquiring or disposing Influence on the overall
Name of subsidiary disposing the subsidiary in the the subsidiary in the reporting production and business
reporting period period performance
Anhui Subway Cordial Wine
Company development needs Establishment
Co., Ltd.
Shanghai Hongbang Culture
Company strategy adjustment Write-off
Communication Co., Ltd.
5. Particulars about significant projects invested by non-raised funds
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Accumulati
Amount of
Total planed ve amount
Name of input during Progress of Gains from Disclosure date Disclosure
amount of actually input
project the reporting project project (if any) index (if any)
investment as of the
period
period-end
Relocation and
Technological
Transform on
80,000 9,539 77,210 95.00% 29 Mar. 2012
the Brewage of
Base Wine and
the supporting
27
2014 Annual Report of Anhui Gujing Distillery Company Limited
facilities
projects
Total 80,000 9,539 77,210 -- -- -- --
VII. Predict the operating results of Jan.-Mar. 2015
Warning of possible loss or considerable YoY change of the accumulated net profit made during the period-begin to the end of the
next reporting period according to prediction, as well as explanations on the reasons:
□ Applicable √ Inapplicable
VIII. Particulars about special purpose entities controlled by the Company
Naught
IX. Outlook of the Company’s future development
(I) Industry development prospects of the Company
Since the recent 3 years, as the growth rate of the macro-economy slowed down, the transformation unsmooth and
the consumption been blocked, the prohibition, the detailing, warning and normalization of the renovation of the
“three public consumptions”, and the liquor industry especially the high-grade liquor were suffering great impact,
the sales of the high-grade products constantly declined, the channels, market and products structure began to step
into the profound adjustment phase with the liquor Industry kicked off the shuffle as well as the liquor pattern was
being reconstitution. In 2015, the macro-economic environment and industry development environment was still
not encouraging and the liquor-making industry reform was still not touched the root as well as the industry
mainly appeared the following characteristics:
1. The mass wine market will appear “crowded” phenomenon
The high-end wine be blocked and gone downward with the mass wine became the growth power of the industry
certainty became a common understanding. In Y2015, whether the national famous wine or the regional brand will
extend the momentum of the power generation of the mass wine thus must bring the products, channels and
market congestion of the mass wine market.
3. Category replacement is intensifying with the personalized custom-made sprung up
As the knowledge of the wine and the pursue of the health concept of the people, the white spirit will face with the
fierce category competition, and the replacement competition such as the grape, spirit, beer, and fruit juice wine
will not be neglected; and the Y2015 will be the normalization year of the liquor custom wine organization with
more wine companies will establish the professional custom departments or the custom wine companies and will
cultivate the growth point by the differentiated products.
4. The whole nation surfing the internet with the wine enterprises embracing the internet
Surfing the internet became the plan of 2015 among multiple of the wine enterprises, of which either in virtue of
the professional platform such as Taobao, Tmall and JD, or independently developed the client-side, thus the “one
website one shop” will become the necessary of the wine enterprises, which meant the “one enterprise + one
website” will develop to become the tendency of “one enterprise + one website + one online shop”.
(II) Development strategy of the Company
The Company takes the “returning to the first camp of the liquor-making industry” and constructing the
“manufacturing empire” as the strategy target of the Company, and embraces which, the development strategy of
28
2014 Annual Report of Anhui Gujing Distillery Company Limited
the Company indicates in the following aspects:
1. Insist to develop in the optimization, speed up the process of “adjustment, enhancing, remolding and
transformation”, adjust the products structure, improve the products quality, strengthen the talents resources
development and management, perfect the pressure transmission mechanism, intensify the examine execution,
enhance the personnel quality, optimize the talents structure and forge the enterprise team with all-win harmony;
2. Insist to execute the overall innovation strategy, enhance the self innovation ability, combine the technical
innovation, management innovation, system innovation and concept innovation, accelerate the enterprise
information construction, realize the resources optimizing configuration and information sharing and exert the
synergistic effect;
3. Insist to execute the operation strategy of the combination of brand-driving and products promotion, walk on
the brand road with differentiation and personalization, intensify the brand construction, overall enhance the brand
image, strengthen the brand-driving effect, strive for the returning of the first army group of the Chinese liquor
through 3 to 5 years fighting and make great efforts to become the best liquor enterprise of China.
4. Become the friendly enterprise that be friendly to the shareholders, employees, customers, partners, society and
environment and actively build the harmony enterprise.
(III) Operation plan of Y2015
In 2015, the company operating revenue plan on the basis of not less than 2014 years, efforts to achieve
growth.
(IV) Operation risks of the Company
1. The risks of the constantly deterioration of the competition environment. The main products of the Company
attribute to the popular consumption products, and accompanied with the products layout adjustment of each
enterprise, part of the high-end brand had turned to the mass region, thus the Company would face with fiercer
competition environment that bring certain uncertain influences on the future sales for the Company.
2. Risks of the industry policies. According to the relevant policies of the nation, the liquor industry which the
Company engaged in was not attributed to the industry encouraged by the nation, if the nation executed the
adjustment on the current liquor industry, for example, the aspects such as the taxation, price and land, would
cause restriction for the liquor industry that lead certain harmful influences on the production and operation of the
Company.
3. Risks of the counterfeit and inferior and as well as the infringing products. The market image of the liquor
products of the Company is favorable with high fine reputation, and the liquor industry is the industry with higher
profits rate. Impelled by the profits, the illegal personnel or the enterprises produced and sold the counterfeit and
inferior and as well as the infringing products involved with the brand of the Company. If such illegal operating
activities had not received efficient resistance, would cause significant harmful influences on the development of
the Company.
4. Risks of the environmental protection. The Company attributes to the liquor-making industry, there would be
certain “three wastes” in the process of the production, although currently the Company had set up a whole set of
the environmental protection system for handling and preventing the incidents that pollute the environments,
which had passed the reviewed and inspection as well as acceptance by the environmental protection department
that met with the national environmental protection standard, however, as the nation paying more and more
attention on the environmental protection issue, the standard of which would become stricter and stricter and the
Company would face with certain environmental protection risks in the future.
(V) The Board of Directors will adopt the following operation measures.
Aims at the current situation of the industry development and according to the development strategy target as well
as the 2015 operation plan of the Company, the Board of Directors of the Company will insist the spirit of the 18th
29
2014 Annual Report of Anhui Gujing Distillery Company Limited
National People's Congress，the 18th Third Plenary Session and the central, provincial and municipal economic
work conference as the guidance, tightly embrace the “one core”, make great efforts to construct “three normalcy”,
accurately execute the “five measurements”, focus the “six embrace” to grasp the implement, forge a iron army
team and stably promote the Company to step towards to the strategy target.
1. Embrace “one core” refers to embrace the core target of the main business strategy target of the liquor
unmoved.
2. Construct the “three normalcy” refers to the new concept, new thinking and new mode. Only the Company
builds up the new normalcy could be the first to completed the enterprise transformation and promote the
enterprise shaping, thus to realize the corner overtaking.
3. Accurately execute the “five measurements” refers to the integrating marketing to ensure the achievement of
the target; cultivate the talents to ensure the aftereffect of the development; upgrade the management to ensure the
operating efficiency; strengthen the supervision to ensure the “Sanzheng” ecology; optimize the organization
structure to ensure the decomposition and landing of the strategy target.
In 2015, the Board of Directors of the Company will lead the whole employees of Gujing to face the difficulty, to
take the enterprise core value as the guidance, to cooperate with absolute sincerity and courage to act, to grow
stronger and larger together of Gujing Company that make great efforts to become the most respectful as well as
the most popular liquor-making enterprise.
X. Explanation of the Board of Directors on “Non-standard Auditor’s Report” issued by the
CPA firm for the reporting period
Naught
XI. Explanation on change of accounting policy, accounting estimates and accounting
methods as compared with the financial report in last year
√ Applicable □ Inapplicable
Detailed in the report "the tenth day, five, 29, important accounting policies and accounting estimates change".
XII. Explanation on the retrospective restatement for correcting the significant accounting
errors during the reporting period
Naught
XIII. Explanation on changes in the consolidated scope compared with the financial report in
last year
√ Applicable □ Inapplicable
The subsidiaries newly included in the consolidated scope
Name of the company Reasons of changes
Anhui Subway Cordial Wine Co., Ltd. Investment and establishment
30
2014 Annual Report of Anhui Gujing Distillery Company Limited
The 3rd Session of the 7th Board of Directors reviewed and approved the Proposal on Investing and Establishing the Wholly-owned
Subsidiary on 29 Aug. 2014. The Company held 100% control right of it and included which into the consolidated scope of the
financial statement of 2014.
XIV. 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:
√ Applicable □ Inapplicable
According to the Proposal on the Profit Distribution of 2013 of the Company approved by Annual General Meeting on 20 Jul. 2014,
the Company distributed the cash dividends to the whole shareholders of RMB 0.35 per share which amounted to RMB 176,260,000
calculated by the issued shares amount of 503,600,000 shares.
Special explanation of the cash dividend policy
Whether conformed with the regulations of the Articles of
association or the requirements of the resolutions of the Yes
shareholders’ meeting:
Whether the dividend standard and the proportion were definite
Yes
and clear:
Whether the relevant decision-making process and the system
Yes
were complete:
Whether the independent director acted dutifully and exerted the
Yes
proper function:
Whether the medium and small shareholders had the chances to
fully express their suggestions and appeals, of which their legal Yes
interest had gained fully protection:
Whether the conditions and the process met the regulations and
was transparent of the adjustment or altered of the cash dividend Inapplicable
policy:
The Company’s preplans on profit distribution and turning capital reserve into share capital for the recent three years (including the
reporting year):
1. The Company’s plan on cash distribution in 2012 was as follows: a cash of RMB 5 (tax included) was distributed for each 10
shares, with no capital reserves turned into share capitals.
2. The Company’s preplan on cash distribution in 2013 was as follows: a cash of RMB 3.5 (tax included) was distributed for each 10
shares, with no capital reserves turned into share capitals.
3. The Company’s preplan on cash distribution in 2014 was as follows: a cash of RMB 2(tax included) was distributed for each 10
shares, with no capital reserves turned into share capitals.
Cash dividend in the recent three years
Unit: RMB Yuan
Amount of cash Net profit belonging The ratio accounting The amount offered The proportion
Dividend year dividend (including to shareholders of in net profit which and re-purchased the offered and
tax) the listed company belongs to shares by cash that re-purchased the
31
2014 Annual Report of Anhui Gujing Distillery Company Limited
in consolidated shareholders of the included in the cash shares by cash that
statement of listed company in bonus included in the cash
dividend year consolidated bonus
statement
2014 100,720,000.00 597,041,887.34 16.87%
2013 176,260,000.00 622,004,915.79 28.34%
2012 251,800,000.00 725,589,286.31 34.70%
Although the company obtains profits and the parent company’s undistributed profit is positive during the reporting period, no cash
dividend distribution pre-plan is put forward.
□Applicable √ Inapplicable
XV. Preplan for profit distribution and turning capital reserve into share capital in the
reporting period
√ Applicable □ Inapplicable
Bonus shares for every 10 shares (shares) 0
Dividend for every 10 shares (RMB Yuan)
2.00
(including tax)
Shares turned from capital reserve for every 10
shares (share)
Total shares as the basis for the allocation preplan
503,600,000
(share)
Total cash dividends (RMB Yuan) (tax included) 100,720,000.00
Distributable profit (RMB Yuan) 1,990,080,289.98
Proportion of cash bonus in the total of profit
100.00%
distribution
Cash dividend policy:
Specific explanation of preplan for profit distribution or preplan for turning capital reserve into share capital
The Company planed to based on the total shares at the year-end of 503,600,000 shares to distribute the dividends with a cash of
RMB 2 (tax included) to the whole shareholders for each 10 shares which was of RMB100,720,000.00 and the retained profits of
RMB1,889,360,289.98 would all transfer to the next year.
XVI. 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 29 Apr. 2015.
Whether the listed company and its subsidiaries were belongs to the heavily polluting industries stimulated by the state department of
environmental protection
□ Yes √ No □ Inapplicable
32
2014 Annual Report of Anhui Gujing Distillery Company Limited
Whether there were any significant society security problems of the listed company and its subsidiaries
□ Yes √ No □ Inapplicable
Whether had been administrative punished in the reporting period
□ Yes √ No □ Inapplicable
XVII. Particulars about researches, visits and interviews received in this reporting period
There was no any activity of field researches, visits and interviews received during the reporting period of the Company.
33
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section V. Significant Events
I. Corporate governance
The situation of the Company’s governance did not differ in principle from the Company Law and the relevant CSRC requirements
in the reporting period.
II. Significant lawsuits or arbitrations
□ Applicable √ Inapplicable
The Company was not involved in any significant lawsuit or arbitration in the reporting period.
III. Occupation of the Company’s capital by the controlling shareholder and its related
parties for non-operating purposes
Naught
IV. Bankruptcy and reorganization
Naught
V. Asset transactions
1. Asset acquisition
Naught
2. Sale of assets
Naught
3. Business combination
Naught
VI. Implementation and influence of equity incentive plan of the Company
Naught
34
2014 Annual Report of Anhui Gujing Distillery Company Limited
VII. Significant related-party transactions
1. Related-party transactions concerning routine operation
Naught
2. Related-party transactions arising from asset acquisition or sale
Naught
3. 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 related-party transactions
Naught
VIII. 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
There was no such situation of the Company.
35
2014 Annual Report of Anhui Gujing Distillery Company Limited
(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
(1) Violation of the external guarantees
Naught
3. Other significant contracts
Naught
4. Other significant transactions
Naught
IX. 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
2. If the Company’s assets or projects existing earnings prediction, and the reporting period is among the
prediction period, it shall explain on whether the assets or projects reach the original earnings prediction
and relevant reason
Naught
X. Particulars about engagement and disengagement of CPAs firm
CPAs firm engaged at present
Name of domestic CPAs firm Ruihua Certified Public Accountants (LLP)
Remuneration of domestic CPAs firm (RMB Ten
110
Thousand Yuan)
Consecutive years of the audit services provided by 2
36
2014 Annual Report of Anhui Gujing Distillery Company Limited
domestic CPAs firm
Name of the certified public accountants from the
Yang Ganlin, Chen Lianwu
domestic CPAs firm
Reengage the CPAs firm at current period or not?
□ Yes √ No
Change the CPAs firm during the audit period or not?
□ Yes √ No
Particulars on engaging the audit firm for the internal control, financial adviser or sponsor
√ Applicable □ Inapplicable
In 2014, the Company engaged the Ruihua Certified Public Accountants (LLP) control audit CPAs of the Company.
XI. Explanation of the Supervisory Committee and Independent Directors (if applicable) on
the “Non-standard Auditor’s Report” issued by the CPAs firm during the reporting period
Inapplicable
XII. Punishment and rectification
Explanation on rectification:
Inapplicable
Particulars about the directors, supervisors, senior management staffs and shareholders holding over 5% shares of the Company
involving in illegal trading the Company’s stocks and the Company has disclose to recover the illegal income
□ Applicable √ Inapplicable
XIII. Particulars about trading suspension and termination faced after the disclosure of
annual report
Naught
XIV. Other significant events
Naught
XV. Significant events of subsidiaries of the Company
Naught
XVI. Corporate bonds issued by the Company
Naught
37
2014 Annual Report of Anhui Gujing Distillery Company Limited
Section VI. Change in Shares & Shareholders
I. Change in shares
1. Change in shares
Unit: Share
Before the change Increase/decrease (+, -) After the change
Capitalizat
Percenta New Bonus ion of Percenta
Number Other Subtotal Number
ge shares shares capital ge
reserve
I. Restricted shares 900 0.00% 900 0.00%
1. Shares held by the state
2. Shares held by
state-owned corporations
3. Shares held by other
900 0.00% 900 0.00%
domestic investors
Among which: shares held
by domestic corporations
Shares held by domestic
900 0.00% 900 0.00%
individuals
4. Shares held by foreign
investors
Among which: Shares held
by foreign corporations
Shares held by foreign
individuals
II. Non-restricted shares 503,599,100 100.00% 503,599,100 100.00%
1. RMB ordinary shares 383,599,100 76.17% 383,599,100 76.17%
2. Domestically listed
120,000,000 23.83% 120,000,000 23.83%
foreign shares
3. Overseas listed foreign
shares
4. Other
III. Total shares 503,600,000 100.00% 503,600,000 100.00%
Reason for the changes in share capital
38
2014 Annual Report of Anhui Gujing Distillery Company Limited
Approval for changes in share capital
□ Applicable √ Inapplicable
Transfer for changes in share capital
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
□ Applicable √ Inapplicable
2. List of change of restricted shares
Naught
II. Issuance and listing of securities
1. Securities issued in the previous three years
Naught
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
Total number of preferred share
common Total number of holders who had
shareholders at the 27,298 shareholders on the 28,216 resumed their voting 0
end of the reporting fifth trading day right at the end of
period the reporting period
(if any) (see note 8)
Particulars about shares held by shareholders with a shareholding percentage over 5% or the Top 5 of them
Sharehold Increas Number Pledged or frozen shares
Total shares Number of
Name of Nature of ing e/decre of
held at the tradable
shareholder shareholder percentag ase non-trada Status of shares Number of shares
period-end shares held
e (%) during ble shares
39
2014 Annual Report of Anhui Gujing Distillery Company Limited
the held
reportin
g
period
ANHUI GUJING
GROUP State-owned 271,354,02
53.88% 271,354,022 Pledged 114,000,000
COMPANY corporation 2
LIMITED
AGREED
BUYBACK
Domestic
SPECIAL
non-stated-owned 2.98% 15,000,000 15,000,000
ACCOUNT OF
corporation
GF SECURITIES
CO., LTD.
UBS
Foreign
(LUXEMBOUR 1.88% 9,464,298 9,464,298
corporation
G) S.A.
GREENWOODS
Foreign
CHINA ALPHA 1.86% 9,386,973 9,386,973
corporation
MASTER FUND
KGI ASIA Foreign
1.56% 7,861,437 7,861,437
LIMITED corporation
Foreign
NORGES BANK 1.14% 5,720,312 5,720,312
corporation
CCB-Yinhua-Sel
ected Securities
Investment Fund Other 0.94% 4,709,805 4,709,805
of No. 88 of Dow
Jones
CHINA
MERCHANTS State-owned
0.78% 3,928,244 3,928,244
SECURITIES corporation
(HK) CO., LTD
GOLDEN
Foreign
CHINA 0.70% 3,786,434 3,786,434
corporation
MASTER FUND
3W GREATER
Foreign
CHINA FOCUS 0.70% 3,529,479 3,529,479
corporation
FUND
Strategic investor or general
Inapplicable
corporation becoming a top ten
40
2014 Annual Report of Anhui Gujing Distillery Company Limited
shareholder due to placing of new
shares (if any) (Notes 3)
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.
Shares held by the top ten non-restricted share holders
Type of shares
Name of shareholder Number of non-restricted shares held at the period-end
Type Number
ANHUI GUJING GROUP Renminbi
271,354,022 271,354,022
COMPANY LIMITED ordinary shares
AGREED BUYBACK SPECIAL
Renminbi
ACCOUNT OF GF SECURITIES 15,000,000 15,000,000
ordinary shares
CO., LTD.
Domestically
UBS (LUXEMBOURG) S.A. 9,464,298 listed foreign 9,464,298
shares
Domestically
GREENWOODS CHINA ALPHA
9,386,973 listed foreign 9,386,973
MASTER FUND
shares
Domestically
KGI ASIA LIMITED 7,861,437 listed foreign 7,861,437
shares
Domestically
NORGES BANK 5,720,312 listed foreign 5,720,312
shares
CCB-Yinhua-Selected Securities
Renminbi
Investment Fund of No. 88 of Dow 4,709,805 4,709,805
ordinary shares
Jones
CHINA MERCHANTS Renminbi
3,928,244 3,928,244
SECURITIES (HK) CO., LTD ordinary shares
Domestically
GOLDEN CHINA MASTER FUND 3,786,434 listed foreign 3,786,434
shares
Domestically
3W GREATER CHINA FOCUS
3,529,479 listed foreign 3,529,479
FUND
shares
41
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 the top 10
shareholders participating in the
Inapplicable
margin trading business (if any) (see
note 4)
Company top 10 common shareholders, top 10 infinite sale conditions common shareholders in trade agreement to buy back whether
during the reporting period
√Yes □No
Wide hair negotiable securities co., LTD., shareholders agreement dedicated buyback account for puning letter macro industrial
investment co., LTD., during the reporting period agreed to buy back the initial exchanges involving stock quantity and proportion
and report as the final agreed repurchase exchange for stock volume, and proportions of the same, 15000000 shares, accounting for
2.98% of the total equity.
2. Particulars about the controlling shareholder
Corporation
Legal
Name of controlling Date of
representative / Organization code Registered capital Business scope
shareholder establishment
company principal
ANHUI GUJING Making beverage,
GROUP COMPANY Liang Jinhui 16 Jan. 1995 151947437 353,380,000 construction materials
LIMITED and plastic products
Future development
Inapplicable
strategy
Operating results,
financial situation, cash
flow and future Inapplicable
development strategy,
etc.
Shares held by the
controlling shareholder
in other listed Inapplicable
companies by holding
or shareholding during
42
2014 Annual Report of Anhui Gujing Distillery Company Limited
the reporting period
Change of the controlling shareholder during the reporting period
□ Applicable √ Inapplicable
3. Particulars about the actual controller
Corporation
Legal
Name of the actual Date of Organizational
representative/ Registered capital Main business scope
controller establishment code
person in charge
The People’s
Government of Bozhou
Future development
Inapplicable
strategy
Operating results,
financial situation, cash
flow and future Inapplicable
development strategy,
etc.
Shares held by the
controlling shareholder
in other listed
Inapplicable
companies by 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%
Anhui Gujing Group Company Limited
53.88%
Anhui Gujing Distillery Co., Ltd.
The actual controller controls the Company via trust or other ways of asset management
□ Applicable √ Inapplicable
43
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
44
2014 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
Liang of the 20 Jul. 19 Jul.
Incumbent Male 50
Jinhui Board of 2014 2017
Directors
General
Zhou 20 Jul. 19 Jul.
Manager, Incumbent Male 41
Qingwu 2014 2017
Director
Vice
General
Manager,
Secretary
Ye of the 20 Jul. 19 Jul.
Incumbent Male 41
Changqing Board of 2014 2017
Directors,
Chief
Accountan
t, Director
Wang 20 Jul. 19 Jul.
Director Incumbent Male 50
Feng 2014 2017
Yang 20 Jul. 19 Jul.
Director Incumbent Male 47
Xiaofan 2014 2017
20 Jul. 19 Jul.
Yan Lijun Director Incumbent Male 44
2014 2017
Wang Independe 20 Jul. 19 Jul.
Incumbent Male 53
Ruihua nt Director 2014 2017
Independe 20 Jul. 19 Jul.
Wang Gao Incumbent Male 50
nt Director 2014 2017
Song Independe 17 Nov. 19 Jul.
Incumbent Male 53
Shuyu nt Director 2014 2017
45
2014 Annual Report of Anhui Gujing Distillery Company Limited
Chairman
of the
20 Jul. 19 Jul.
Xu Peng Supervisor Incumbent Male 45
2014 2017
y
Committee
Niu 20 Jul. 19 Jul.
Supervisor Incumbent Male 44
Haiting 2014 2017
Fu 20 Jul. 19 Jul.
Supervisor Incumbent Male 45
Qiangxin 2014 2017
Hu 20 Jul. 19 Jul.
Supervisor Incumbent Male 49
Wenchao 2014 2017
Lu 20 Jul. 19 Jul.
Supervisor Incumbent Male 35
Duicang 2014 2017
General
20 Jul. 19 Jul.
Yan Lijun Manager Incumbent Male 44
2014 2017
Assistant
General
Zhai 20 Jul. 19 Jul.
Manager Incumbent Male 44 1,200 1,200
Liangdong 2014 2017
Assistant
General
Zhang 20 Jul. 19 Jul.
Manager Incumbent Male 46
Lihong 2014 2017
Assistant
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. Liang Jinhui, 50 year-old, is Political Engineer who has educational experience of graduate student, incumbent Director and
president of the Company and Gujing Group. 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, Fifth and Sixth
Board of Directors
(II) Mr. Zhou Qingwu, 41 year-old, is Economist who has educational experience of undergraduate college. At present, he is Director
and 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 and 6th Board of Directors and Vice General Manager.
(III) Mr. Ye Changqing, 41 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 5 th and 6th Board of Directors, Chief Accountant.
46
2014 Annual Report of Anhui Gujing Distillery Company Limited
(IV) Mr. Wang Feng, 50 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 and 6th Board of Directors.
(V) Mr. Yang Xiaofan, 47 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 and 6th Board of Directors.
(VI) Yan Lijun, male, 44 year-old, bachelor degree with Senior Taster. Now he is Director, Assistant of GM of the Company, GM of
Bozhou Gujin Sale Co., Ltd. In Aug. 1995, he began to work. He once worked as salesman of Sale Company, District Manager,
Director of Market Research, Vice Manager of Planning Department, Director of Hefei Strategic Operations Center and GM of the
Company
(VII) Mr. Wang Ruihua, 53 year-old, doctor degree in accounting, Incumbent Independent Director of the Company, Director of
MBA Education Centre of Central University of Finance and Economics, Dean of School of Business of Central University of
Finance and Economics, tutor of PHD student, Independent Director of ZHONG KE SAN HUAN, DATANG TELECOM
TECHNOLOGY CO., LTD. and Sinolink Securities Co Ltd. He ever took post of Deputy Director of the Graduate Student
Department of Central University of Finance and Economics. (VIII) Mr. Wu Cisheng, 52 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.
(VIII) Wang Gao, Male, 50 years old, Doctor of Sociology，Professor of Marketing in China Europe International Business School.
Academic Director of Chief Marketing Officer (CMO) Project, Co-Director of Chinese Enterprise Globalization Research Center. He
once worked as Associate Professor, Deputy Dean of Department of Marketing in School of Economics and Management, Tsinghua
University, deputy director of China's Retail Research Center Academic Director of Harvard - central Europe - tsinghua university
senior managers (SEPC) project. Strategic Analysis Manager of Minute Maid Branch of Coca-Cola Company and senior counselor of
The Information Resources Co., Ltd. (IRI).
(IX) Song Shuyu, male, 53 years old, who has educational experience of undergraduate college. Senior Engineer, Master of Chinese
wine. Now, he is Deputy Secretary General of China Alcoholic Drinks Association, Secretary-general of Liquor Branch Association,
Secretary General of Market Professional Committee, Secretary General of White Wine Club Technical Committee, specialist who
enjoy the special allowance of the state council. He also is member of Chinese liquor standardization technical committee, Deputy
Secretary General of strong-flavor, Feng-flavour, soybean-flavor and rice flavour Liquor Technical Committee of Chinese Liquor
Standardization Technical Committee, Chairman of Committee of Te-flavour Chinese spirits and Laobaigan-flavour Chinese spirits
standardization technical committee.
(X) Mr. Xu Peng, 45 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
47
2014 Annual Report of Anhui Gujing Distillery Company Limited
of Bozhou Gujing Sales Company.
(XI) Mr. Niu Haiting, 44 year-old, has educational experience of undergraduate college. He is incumbent Supervisor of the Company,
Member of Party Committee, Chairman of the Labor Union 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, Director of the
Office Party and Chief Inspector of Safety Management Center.
(XII) Mr. Fu Qiangxin, 45 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.
(XIII) Mr. Hu Wenchao, is 49 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.
(XIV) Mr. Lu Duicang, 35 year-old, has educational experience of undergraduate college. Now, he is incumbent Supervisor of the
Company and GM of Hui Xin Finance. 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.
(XV)Mr. Zhai Liangdong, Male, 44-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,
Deputy Director, Director of Gujing Group Office; Director of corporate office.
(XVI) Mr. Zhang Lihong, Male, 46-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, and Chief Inspector of Comprehensive Service Center.
Employment in shareholders’ entities
√ Applicable □ Non-Applicable
Whether receiving
Post held in Ending date
Beginning date of subsidies and
Name Name of shareholders’ entity shareholders’ of the office
the office term remuneration from
entity term
shareholders’ entities
Chairman of
the Board of
LIANG Directors,
Anhui Gujing Group Co., Ltd. 1 May 2014 Yes
JINHUI Chairman of
Party
Committee
Deputy
Chairman of
Party
WANG FENG Anhui Gujing Group Co., Ltd. 1 Aug. 2010 Yes
Committee,
Chairman of
Discipline
48
2014 Annual Report of Anhui Gujing Distillery Company Limited
Inspection
Committee
YANG Vice
Anhui Gujing Group Co., Ltd. 1 Nov. 2009 Yes
XIAOFAN President
Deputy
ZHOU Chairman of
Anhui Gujing Group Co., Ltd. 1 Nov. 2009 No
QINGWU Party
Committee
Chief
Inspector of
FU
Anhui Gujing Group Co., Ltd. Financial 1 Jul. 2014 Yes
QIANGXIN
Management
Center
HU Chief of HR
Anhui Gujing Group Co., Ltd. 1 Jun. 2012 Yes
WENCHAO 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
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
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 Ten Thousand Yuan
Total Total amount
Total amount
compensation of payment got
Incumbent or of payment got
Name Title Gender Age from from the
not from the
shareholders shareholders’
Company
entities
LIANG Chairman of Male 50 Incumbent 102.7 21.62 124.32
49
2014 Annual Report of Anhui Gujing Distillery Company Limited
JINHUI the Board of
Directors
Director,
ZHOU
General Male 41 Incumbent 94.02 94.02
QINGWU
Manager
Director, Vice
General
Manager,
YE Secretary of
Male 41 Incumbent 86.26 86.26
CHANGQING the Board of
Directors,
Chief
Accountant
WANG FENG Director Male 50 Incumbent 0 96.52 96.52
YANG 96.52
Director Male 47 Incumbent 0 96.52
XIAOFAN
WANG Independent
Male 53 Incumbent 7.5 7.5
RUIHUA Director
Independent
WANG GAO Male 50 Incumbent 7.5 7.5
Director
SONG Independent
Male 53 Incumbent 7.5 7.5
SHUYU Director
Chairman of
XU PENG the Supervisory Male 45 Incumbent 78.87 78.87
Committee
NIU HAITING Supervisor Male 44 Incumbent 0 36.24 36.24
FU 38.49
Supervisor Male 45 Incumbent 0 38.49
QIANGXIN
HU 59.18
Supervisor Male 49 Incumbent 0 59.18
WENCHAO
LU DUICANG Supervisor Male 35 Incumbent 0 43.9 43.9
YAN LIJUN Director Male 44 Incumbent 95.65 95.65
General
ZHAI
Manager Male 44 Incumbent 78.87 78.87
LIANGDONG
Assistant
General
ZHANG
Manager Male 46 Incumbent 78.87 78.87
LIHONG
Assistant
Total -- -- -- -- 637.74 392.47 1030.21
50
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
Name Post Type Date Reason
YU LIN Director Former 23 Apr. 2014
Left as the
Independent
WU CISHENG service term 19 Jun. 2014
Director
expired
Left as the
Independent
LIU LIBIN service term 19 Jun. 2014
Director
expired
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. 2014, the total number of current employees in the Company is 5,937
1. Particulars about professional categories
Professional category Number of personnel Proportion
Production staff 4440 74.79%
Sales staff 588 9.90%
Technical staff 282 4.75%
Financial staff 95 1.60%
Administrative staff 532 8.96%
Total 5937 100.00%
51
2014 Annual Report of Anhui Gujing Distillery Company Limited
Financial staff, Administrative staff
Professional categories
Technical staff,
8.96%
Sales staff
Production staff
Sales staff
Production staff
Technical staff
Financial staff
Administrative staff
2. Level of education:
Level of education Number (person) proportion
High school and below 4619 77.80%
Junior college 700 11.79%
Bachelor degree 597 10.06%
Master degree or above 21 0.35%
Total 5937 100%
Bachelor degree MaMaster degree or above Level of education
Junior collegeeducation
education High school and below
Junior college
High school and below, 77.80%
Bachelor degree
Master degree or above
52
2014 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, 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 20 th 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
53
2014 Annual Report of Anhui Gujing Distillery Company Limited
Session Opening date Name of proposal Resolution Disclosure date Index for disclosure
2013 Annual Report
of the Board of
On the Cninfo
Directors,
website
2013Annual Report
Announcement on
and Abstract,
Resolutions Passed
2013 Annual Proposal on 2013
All the proposals on the 2013 Annual
Shareholders’ 20 Jun. 2014 Annual Profit 21 Jun. 2014
were passed. Shareholders’
General Meeting Distribution and
General Meeting
Transfer of Capital
(No. 2014-020)
Reserve to Common
http://www.cninfo.co
Shares, Proposal on
m.cn
Employing Audit
Institution for 2014
2. Particulars about temporary shareholders’ general meeting
Session Opening date Name of proposal Resolution Disclosure date Index for disclosure
On the Cninfo
Proposal on website
Replacing 2013 Announcement on
Annual Audit Resolutions Passed
The 1st Temporary Institution, Proposal on The 1st
Shareholders’ about using saving All the proposals Temporary
18 Feb. 2014 19 Feb. 2014
General Meeting in raise fund were passed. Shareholders’
2014 perpetually General Meeting in
supplement 2014 (No.
circulating fund of 2014-008)
the Company http://www.cninfo.co
m.cn
On the Cninfo
website
Announcement on
Resolutions Passed
The 2 nd
Temporary Proposal on on the The 2nd
Shareholders’ Replacing All the proposals Temporary
17 Nov. 2014 18 Nov. 2014
General Meeting in Independent Director were passed. Shareholders’
2014 of the Company General Meeting in
2014 (No.
2014-032)
http://www.cninfo.co
m.cn
54
2014 Annual Report of Anhui Gujing Distillery Company Limited
3. Special Shareholders’ General Meeting required by the preferred stockholder with voting rights
recovered
None
III. Performance of the Independent Directors during the Reporting Period
1. Particulars about the independent directors attending the board sessions and the shareholders’ general meetings
Particulars about the independent directors attending the board sessions
Failing to present
Presence by
Name of independent Due presence Presence in Entrusted in person for two
telecommunicati Absence (times)
directors (times) person (times) presence (times) consecutive
on (times)
sessions or not
WANG RUIHUA 9 2 7 0 0 No
WANG GAO 4 1 3 0 0 No
SONG SHUYU 0 0 0 0 0 No
Presence of independent directors in
1
shareholders’ general meeting (times)
2. Particulars about independent directors propose objection on relevant events
Whether independent directors propose objection on relevant events or not?
□ Yes √ No
The independent directors didn’t propose objection on relevant events during the reporting period.
3. Other explanation on performance of independent directors
Whether the advices of independent directors for the Company were adopted or not?
√ Yes □ No
Explanation on the advices of independent directors for the Company being adopted or not adopted
During reporting period, the independent director of the Company strictly un line with related laws and regulation of Articles of
Associations, the independent directors perform their duties to propose professional opinions or suggestions to the operation of the
Company. During reporting period, independent directors propose independent opinions to the events needed, played its role in
maintaining the legal interest of the shareholders of the Company.
IV. Performance of the Special Committees under the Board during 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 strategy.
55
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 2014.
(2) Upon discussion with Ruihua Certified Public Accountants for the 2014 annual audit, it determined the schedule for the financial
report and internal control audit for 2014.
(3) It communicated in advance with the CPAs firm and independent directors before the CPAs firm came to the Company and
started the 2014 annual audit.
(3) It reviewed the short form of the preliminary financial statements prepared by the financial department of the Company for the
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 2014 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 staffs 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,
56
2014 Annual Report of Anhui Gujing Distillery Company Limited
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,
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.
57
2014 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 and the stipulations of 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 2014 Annual Internal Control published on the Cninfo website on 29 April 2015.
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, and 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 29 April 2015
control
Index for disclosure of whole
Cninfo website (www.cninfo.com.cn) “2014 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
Ruihua Certified Public Accountants (Special General Partnership) believe, Anhui Gujing Distillery Co., Ltd. maintained effective
internal control of financial statements in all significant aspects on 31 Dec. 2014 in accordance with Basic Standards for Internal
58
2014 Annual Report of Anhui Gujing Distillery Company Limited
Control and relevant regulations.
Disclosure date of whole article of
29 April 2015
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 CPAs firm issues an Auditor’s Report on Internal Control with non-standard opinion or not?
□ Yes √ No
Whether the Auditor’s Report on Internal Control from the CPAs firm is in consistent with the Self-appraisal Report from the Board
or not?
√ Yes □ No
Whether the CPAs firm issues an Auditor’s Report on Internal Control with non-standard opinion or not?
□ Yes √ No
Whether the Auditor’s Report on Internal Control from the CPAs firm is in consistent with the Self-appraisal Report from the Board
or not?
√ 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.
59
2014 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 Apr. 27 2015
Ruihua Certified Public Accountants (Special General
Name of audit institution
Partnership)
Reference number of audit report Ruihua SZ [2015] No. 48390019
Name of CPA Yang Ganlin, Chen Lianwu
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. (“Gujing”), which comprise the consolidated
and the Company’s balance sheet as at December 31, 2014, 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, 2014 and consolidated operating results and cash
flow in 2014 as well as the operating results at 31 Dec. 2014and the operating results & cash flow in 2014 of Anhui Gujing Distillery
60
2014 Annual Report of Anhui Gujing Distillery Company Limited
Co., Ltd..
II. Financial Statement
Unit of statements in the notes appended to financial report is RMB Yuan
1. Consolidated balance sheet
Prepared by Anhui Gujing Distillery Company Limited
31 Dec. 2014
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 718,460,442.79 1,381,930,710.96
Settlement reserves
Intra-group lendings
Financial assets measured at fair
value of which changes are recorded in 303,919.60
current profits and losses
Derivative financial assets
Notes receivable 505,893,430.66 154,408,425.31
Accounts receivable 4,337,953.26 6,374,469.99
Accounts paid in advance 35,711,617.98 90,217,698.50
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable 4,274,666.66
Dividend receivable
Other accounts receivable 7,967,903.24 6,296,326.20
Financial assets purchased under
agreements to resell
Inventories 1,227,182,774.09 1,075,033,137.30
Assets held for sale
Non-current assets due within 1 year
Other current assets 1,501,552,476.11 980,093,922.21
Total current assets 4,005,685,184.39 3,694,354,690.47
Non-current assets:
Loans by mandate and advances
61
2014 Annual Report of Anhui Gujing Distillery Company Limited
granted
Available-for-sale financial assets 88,332,932.00 24,075,687.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment
Investing real estate 32,074,356.24 35,188,079.66
Fixed assets 1,724,134,467.11 1,266,481,752.59
Construction in progress 61,637,510.96 377,338,939.54
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 306,488,782.60 315,224,921.54
R&D expense
Goodwill
Long-term deferred expenses 131,921,179.23 60,898,594.60
Deferred income tax assets 63,243,753.50 43,371,896.87
Other non-current assets
Total of non-current assets 2,407,832,981.64 2,122,579,871.80
Total assets 6,413,518,166.03 5,816,934,562.27
Current liabilities:
Short-term borrowings
Borrowings from Central Bank
Customer bank deposits and due to
banks and other financial institutions
Intra-group borrowings
Financial liabilities measured at fair
value of which changes are recorded in
current profits and losses
Derivative financial liabilities
Notes payable 258,452,214.00 235,770,000.00
Accounts payable 404,634,196.58 442,935,399.44
Accounts received in advance 377,503,471.86 147,257,393.88
Financial assets sold for repurchase
Handling charges and commissions
62
2014 Annual Report of Anhui Gujing Distillery Company Limited
payable
Payroll payable 220,198,521.28 231,343,202.17
Tax payable 468,679,523.63 599,513,448.19
Interest payable
Dividend payable
Other accounts payable 456,572,505.42 373,903,452.51
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting underwriting of
securities
Liabilities held for sale
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 2,186,040,432.77 2,030,722,896.19
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: preferred shares
Perpetual bonds
Long-term payables
Long-term payroll payables
Specific payables
Estimated liabilities
Deferred income 40,839,961.86 43,455,409.03
Deferred income tax liabilities 5,586,793.44
Other non-current liabilities
Total non-current liabilities 46,426,755.30 43,455,409.03
Total liabilities 2,232,467,188.07 2,074,178,305.22
Owners’ equity:
Share capital 503,600,000.00 503,600,000.00
Other equity instruments
Of which: preferred shares
63
2014 Annual Report of Anhui Gujing Distillery Company Limited
Perpetual bonds
Capital reserves 1,294,938,493.19 1,294,938,493.19
Less: Treasury stock
Other comprehensive income 16,669,604.07 -843,229.50
Specific reserves
Surplus reserves 256,902,260.27 256,902,260.27
Provisions for general risks
Retained profits 2,108,940,620.43 1,688,158,733.09
Total equity attributable to owners of
4,181,050,977.96 3,742,756,257.05
the Company
Minority interests
Total owners’ equity 4,181,050,977.96 3,742,756,257.05
Total liabilities and owners’ equity 6,413,518,166.03 5,816,934,562.27
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Zhu Jiafeng
2. Balance sheet of the Company
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 593,001,536.78 1,040,360,357.51
Financial assets measured at fair
value of which changes are recorded in 278,509.60
current profits and losses
Derivative financial assets
Notes receivable 286,449,264.42 81,472,414.44
Accounts receivable 1,608,829.64 1,297,542.13
Accounts paid in advance 5,506,676.65 1,288,277.31
Interest receivable 4,274,666.66
Dividend receivable
Other accounts receivable 124,826,309.55 139,654,563.53
Inventories 1,197,978,799.15 1,036,496,459.02
Assets held for sale
Non-current assets due within 1 year
64
2014 Annual Report of Anhui Gujing Distillery Company Limited
Other current assets 1,497,612,148.31 980,093,922.21
Total current assets 3,711,536,740.76 3,280,663,536.15
Non-current assets:
Available-for-sale financial assets 88,332,932.00 24,075,687.00
Held-to-maturity investments
Long-term accounts receivable 4,793,366.46 4,494,950.37
Long-term equity investment 338,089,408.32 308,089,408.32
Investing real estate 30,151,635.36 33,124,717.82
Fixed assets 1,525,364,298.59 1,057,111,133.85
Construction in progress 61,531,773.90 377,239,903.56
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 192,318,384.28 197,787,553.94
R&D expense
Goodwill
Long-term deferred expenses 131,864,366.43 59,482,540.30
Deferred income tax assets 35,421,614.18 34,095,084.20
Other non-current assets
Total of non-current assets 2,407,867,779.52 2,095,500,979.36
Total assets 6,119,404,520.28 5,376,164,515.51
Current liabilities:
Short-term borrowings
Financial liabilities measured at fair
value of which changes are recorded in
current profits and losses
Derivative financial liabilities
Notes payable 93,602,214.00 26,150,000.00
Accounts payable 402,837,653.24 437,297,694.54
Accounts received in advance 1,064,055,921.66 830,722,853.80
Payroll payable 79,329,070.21 87,936,100.97
Tax payable 168,778,299.92 205,717,464.45
Interest payable
Dividend payable
65
2014 Annual Report of Anhui Gujing Distillery Company Limited
Other accounts payable 255,065,310.80 153,888,199.87
Liabilities held for sale
Non-current liabilities due within 1
year
Other current liabilities
Total current liabilities 2,063,668,469.83 1,741,712,313.63
Non-current liabilities:
Long-term borrowings
Bonds payable
Of which: preferred shares
Perpetual bonds
Long-term payables
Long-term payroll payables
Specific payables
Estimated liabilities
Deferred income 40,839,961.86 43,455,409.03
Deferred income tax liabilities 5,584,087.19
Other non-current liabilities
Total non-current liabilities 46,424,049.05 43,455,409.03
Total liabilities 2,110,092,518.88 1,785,167,722.66
Owners’ equity:
Share capital 503,600,000.00 503,600,000.00
Other equity instruments
Of which: preferred shares
Perpetual bonds
Capital reserves 1,247,162,107.35 1,247,162,107.35
Less: Treasury stock
Other comprehensive income 16,669,604.07 -843,229.50
Specific reserves
Surplus reserves 251,800,000.00 251,800,000.00
Retained profits 1,990,080,289.98 1,589,277,915.00
Total owners’ equity 4,009,312,001.40 3,590,996,792.85
Total liabilities and owners’ equity 6,119,404,520.28 5,376,164,515.51
66
2014 Annual Report of Anhui Gujing Distillery Company Limited
3. Consolidated income statement
Unit: RMB Yuan
Item Closing balance Opening balance
I. Total operating revenues 4,650,855,881.72 4,580,575,654.71
Including: Sales income 4,650,855,881.72 4,580,575,654.71
Interest income
Premium income
Handling charge and commission
income
II. Total operating costs 3,980,555,815.23 3,766,069,970.22
Including: Cost of sales 1,459,072,913.24 1,384,137,091.08
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 666,912,988.72 631,171,183.76
Selling and distribution expenses 1,304,206,036.06 1,279,550,577.02
Administrative expenses 579,424,693.56 510,185,897.33
Financial expenses -37,751,610.36 -47,011,977.06
Asset impairment loss 8,690,794.01 8,037,198.09
Add: Gain/(loss) from change in fair
121,035.00
value (“-” means loss)
Gain/(loss) from investment (“-”
105,142,601.27 10,050,415.19
means loss)
Including: share of profits in
associates and joint ventures
Foreign exchange gains (“-” means
loss)
III. Business profit (“-” means loss) 775,563,702.76 824,556,099.68
Add: non-operating income 28,566,056.14 31,597,842.75
67
2014 Annual Report of Anhui Gujing Distillery Company Limited
Including: Gains on disposal of
625,342.92 734,264.74
non-current assets
Less: non-operating expense 7,925,251.76 4,242,753.03
Including: Losses on disposal of
2,759,691.62 2,120,610.71
non-current assets
IV. Total profit (“-” means loss) 796,204,507.14 851,911,189.40
Less: Income tax expense 199,162,619.80 229,906,273.61
V. Net profit (“-” means loss) 597,041,887.34 622,004,915.79
Net profit attributable to owners of
597,041,887.34 622,004,915.79
the Company
Minority shareholders’ income
VI. After-tax net amount of other
17,512,833.57 -2,936,767.38
comprehensive incomes
After-tax net amount of other
comprehensive incomes attributable to 17,512,833.57 -2,936,767.38
owners of the Company
(I) Other comprehensive incomes
that will not be reclassified into gains and
losses
1. Changes in net liabilities or
assets with a defined benefit plan upon
re-measurement
2. Enjoyable shares in other
comprehensive incomes in investees that
cannot be reclassified into gains and
losses under the equity method
(II) Other comprehensive incomes
that will be reclassified into gains and 17,512,833.57 -2,936,767.38
losses
1. Enjoyable shares in other
comprehensive incomes in investees that
will be reclassified into gains and losses
under the equity method
2. Gains and losses on fair
value changes of available-for-sale 17,512,833.57 -2,936,767.38
financial assets
3. Gains and losses on
reclassifying held-to-maturity
investments into available-for-sale
68
2014 Annual Report of Anhui Gujing Distillery Company Limited
financial assets
4. Effective hedging gains and
losses on cash flows
5. Foreign-currency financial
statement translation difference
6. Other
After-tax net amount of other
comprehensive incomes attributable to
minority shareholders
VII. Total comprehensive incomes 614,554,720.91 619,068,148.41
Attributable to owners of the
614,554,720.91 619,068,148.41
Company
Attributable to minority
shareholders
VIII. Earnings per share
(I) Basic earnings per share 1.19 1.24
(II) Diluted earnings per share 1.19 1.24
Legal representative: Yu Lin Person-in-charge of the accounting work: Ye Changqing
Chief of the accounting division: Zhu Jiafeng
4. Income statement of the Company
Unit: RMB Yuan
Item 2014 2013
I. Total sales 2,640,452,479.82 2,529,549,854.01
Less: cost of sales 1,476,012,978.04 1,398,337,758.52
Business taxes and surcharges 631,981,946.23 592,720,228.35
Distribution expenses 128,260,320.96 182,732,468.72
Administrative expenses 385,897,886.00 309,058,351.45
Financial costs -31,777,767.71 -44,325,968.34
Impairment loss 9,067,474.85 7,286,854.02
Add: gain/(loss) from change in fair
110,210.00
value (“-” means loss)
Gain/(loss) from investment (“-”
572,118,594.50 600,946,599.56
means loss)
Including: income form investment
69
2014 Annual Report of Anhui Gujing Distillery Company Limited
on associates and joint ventures
II. Business profit (“-” means loss) 613,238,445.95 684,686,760.85
Add: non-operating income 17,634,363.74 16,000,980.87
Including: Gains on disposal of
585,411.86 495,288.46
non-current assets
Less: non-operating expense 3,669,574.78 3,242,473.29
Including: Losses on disposal of
1,788,158.02 1,299,935.04
non-current assets
III. Total profit (“-” means loss) 627,203,234.91 697,445,268.43
Less: Income tax expense 50,140,859.93 37,902,840.47
IV. Net profit (“-” means loss) 577,062,374.98 659,542,427.96
V. After-tax net amount of other
17,512,833.57 -2,936,767.38
comprehensive incomes
(I) Other comprehensive incomes that
will not be reclassified into gains and
losses
1. Changes in net liabilities or
assets with a defined benefit plan upon
re-measurement
2. Enjoyable shares in other
comprehensive incomes in investees
that cannot be reclassified into gains
and losses under the equity method
(II) Other comprehensive incomes
that will be reclassified into gains and 17,512,833.57 -2,936,767.38
losses
1. Enjoyable shares in other
comprehensive incomes in investees
that will be reclassified into gains and
losses under the equity method
2. Gains and losses on fair value
changes of available-for-sale financial 17,512,833.57 -2,936,767.38
assets
3. Gains and losses on
reclassifying held-to-maturity
investments into available-for-sale
financial assets
4. Effective hedging gains and
losses on cash flows
70
2014 Annual Report of Anhui Gujing Distillery Company Limited
5. Foreign-currency financial
statement translation difference
6. Other
VI. Total comprehensive incomes 594,575,208.55 656,605,660.58
VII. Earnings per share
(I) Basic earnings per share 1.15 1.31
(II) Diluted earnings per share 1.15 1.31
5. Consolidated cash flow statement
Unit: RMB Yuan
Item 2014 2013
I. Cash flows from operating activities:
Cash received from sale of
5,299,356,137.71 5,381,770,280.57
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 financial
assets measured at fair value of which
changes are recorded into current gains
and losses
Cash received from interest, handling
charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in repurchase
business
Tax refunds received 107,163.11
71
2014 Annual Report of Anhui Gujing Distillery Company Limited
Other cash received relating to
171,461,104.20 299,273,978.50
operating activities
Subtotal of cash inflows from operating
5,470,924,405.02 5,681,044,259.07
activities
Cash paid for goods and services 1,517,387,902.41 1,673,212,674.71
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
Cash paid to and for employees 989,911,967.81 924,834,475.73
Various taxes paid 1,620,441,094.09 1,483,773,600.56
Other cash payment relating to
955,689,150.82 960,968,152.76
operating activities
Subtotal of cash outflows from
5,083,430,115.13 5,042,788,903.76
operating activities
Net cash flows from operating activities 387,494,289.89 638,255,355.31
II. Cash flows from investing activities:
Cash received from withdrawal of
2,287,057,026.56 900,000,000.00
investments
Cash received from return on
92,975,082.74 10,050,415.19
investments
Net cash received from disposal of
fixed assets, intangible assets and other 1,144,535.30 2,831,977.74
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
1,850,000.00 35,423,586.00
investing activities
Subtotal of cash inflows from investing
2,383,026,644.60 948,305,978.93
activities
Cash paid to acquire fixed assets,
387,438,488.77 557,480,975.37
intangible assets and other long-term
72
2014 Annual Report of Anhui Gujing Distillery Company Limited
assets
Cash paid for investment 2,831,392,713.89 1,880,000,000.00
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
3,218,831,202.66 2,437,480,975.37
investing activities
Net cash flows from investing activities -835,804,558.06 -1,489,174,996.44
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Including: Cash received from
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
activities
Repayment of borrowings
Cash paid for interest expenses and
176,260,000.00 251,800,000.00
distribution of dividends or profit
Including: dividends or profit paid
by subsidiaries to minority shareholders
Other cash payments relating to
financing activities
Sub-total of cash outflows from
176,260,000.00 251,800,000.00
financing activities
Net cash flows from financing activities -176,260,000.00 -251,800,000.00
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
-624,570,268.17 -1,102,719,641.13
equivalents
73
2014 Annual Report of Anhui Gujing Distillery Company Limited
Add: Opening balance of cash and
1,306,930,710.96 2,409,650,352.09
cash equivalents
VI. Closing balance of cash and cash
682,360,442.79 1,306,930,710.96
equivalents
6. Cash flow statement of the Company
Unit: RMB Yuan
Item 2014 2013
I. Cash flows from operating activities:
Cash received from sale of
3,109,799,921.89 3,136,291,164.98
commodities and rendering of service
Tax refunds received 107,163.11
Other cash received relating to
99,709,660.72 116,309,895.62
operating activities
Subtotal of cash inflows from operating
3,209,616,745.72 3,252,601,060.60
activities
Cash paid for goods and services 1,657,562,664.94 1,826,604,908.68
Cash paid to and for employees 444,498,190.80 428,367,064.51
Various taxes paid 964,627,298.20 938,402,383.86
Other cash payment relating to
67,606,275.31 124,356,345.13
operating activities
Subtotal of cash outflows from
3,134,294,429.25 3,317,730,702.18
operating activities
Net cash flows from operating activities 75,322,316.47 -65,129,641.58
II. Cash flows from investing activities:
Cash received from retraction of
1,961,242,567.80 900,000,000.00
investments
Cash received from return on
557,438,369.11 600,946,599.56
investments
Net cash received from disposal of
fixed assets, intangible assets and other 1,059,792.33 709,777.79
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
1,850,000.00 35,423,586.00
investing activities
Subtotal of cash inflows from investing 2,521,590,729.24 1,537,079,963.35
74
2014 Annual Report of Anhui Gujing Distillery Company Limited
activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 373,798,440.05 547,137,594.99
assets
Cash paid for investment 2,502,613,426.39 1,922,998,976.70
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
2,876,411,866.44 2,470,136,571.69
investing activities
Net cash flows from investing activities -354,821,137.20 -933,056,608.34
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Cash received from borrowings
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
activities
Repayment of borrowings
Cash paid for interest expenses and
176,260,000.00 251,800,000.00
distribution of dividends or profit
Other cash payments relating to
financing activities
Sub-total of cash outflows from
176,260,000.00 251,800,000.00
financing activities
Net cash flows from financing activities -176,260,000.00 -251,800,000.00
IV. Effect of foreign exchange rate
changes on cash and cash equivalents
V. Net increase in cash and cash
-455,758,820.73 -1,249,986,249.92
equivalents
Add: Opening balance of cash and
1,040,360,357.51 2,290,346,607.43
cash equivalents
VI. Closing balance of cash and cash 584,601,536.78 1,040,360,357.51
75
2014 Annual Report of Anhui Gujing Distillery Company Limited
equivalents
7. Consolidated statement of changes in owners’ equity
2014
Unit: RMB Yuan
2014
Equity attributable to owners of the Company
Other equity
Other Minorit Total
Item instruments Less: General
Share Capital compre Specific Surplus Retaine y owners’
Prefer Perpet treasury risk
capital reserve hensive reserve reserve d profit interests equity
red ual Other stock reserve
incomes
shares bonds
I. Balance at the 503,60 1,294,9 1,688,1 3,742,7
-843,22 256,902
end of the 0,000. 38,493. 58,733. 56,257.
9.50 ,260.27
previous year 00 19 09 05
Add: change of
accounting policy
Correction of
errors in previous
periods
Business
mergers under the
same control
Other
II. Balance at the 503,60 1,294,9 1,688,1 3,742,7
-843,22 256,902
beginning of the 0,000. 38,493. 58,733. 56,257.
9.50 ,260.27
year 00 19 09 05
III. Increase/
decrease in the 17,512, 420,781 438,294
period (“-” means 833.57 ,887.34 ,720.91
decrease)
(I) Total
17,512, 597,041 614,554
comprehensive
833.57 ,887.34 ,720.91
incomes
(II) Capital
increased and
reduced by owners
1. Common
shares increased
76
2014 Annual Report of Anhui Gujing Distillery Company Limited
by shareholders
2. Capital
increased by
holders of other
equity instruments
3. Amounts
of share-based
payments
recognized in
owners’ equity
4. Other
-176,26 -176,26
(III) Profit
0,000.0 0,000.0
distribution
0 0
1.
Appropriations to
surplus reserves
2.
Appropriations to
general risk
provisions
3.
-176,26 -176,26
Appropriations to
0,000.0 0,000.0
owners (or
0 0
shareholders)
4. Other
(IV) 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
77
2014 Annual Report of Anhui Gujing Distillery Company Limited
making up losses
4. Other
(V) Specific
reserve
1. Withdrawn
for the period
2. Used in the
period
(VI) Other
503,60 1,294,9 2,108,9 4,181,0
IV. Closing 16,669, 256,902
0,000. 38,493. 40,620. 50,977.
balance 604.07 ,260.27
00 19 43 96
2013
Unit: RMB Yuan
2013
Equity attributable to owners of the Company
Other equity
Minorit
instruments Other Total
Item y
Less: General
Share Prefe Capital compre Specific Surplus Retaine owners’
treasury risk interest
Perpet equity
capital rred reserve hensive reserve reserve d profit
ual Other stock reserve s
share incomes
bonds
s
I. Balance at the 1,294,9 1,356,1 3,375,4
503,600 2,093,5 218,736
end of the 38,493. 19,112. 88,108.
,000.00 37.88 ,964.73
previous year 19 84 64
Add: change of
accounting policy
Correction of
errors in previous
periods
Business
mergers under the
same control
Other
II. Balance at the 1,294,9 1,356,1 3,375,4
503,600 2,093,5 218,736
beginning of the 38,493. 19,112. 88,108.
,000.00 37.88 ,964.73
year 19 84 64
III. Increase/ -2,936,7 38,165, 332,039 367,268
decrease in the 67.38 295.54 ,620.25 ,148.41
78
2014 Annual Report of Anhui Gujing Distillery Company Limited
period (“-” means
decrease)
(I) Total
-2,936,7 622,004 619,068
comprehensive
67.38 ,915.79 ,148.41
incomes
(II) Capital
increased and
reduced by owners
1. Common
shares increased
by shareholders
2. Capital
increased by
holders of other
equity instruments
3. Amounts
of share-based
payments
recognized in
owners’ equity
4. Other
-289,96 -251,80
(III) Profit 38,165,
5,295.5 0,000.0
distribution 295.54
4 0
1.
38,165, -38,165,
Appropriations to
295.54 295.54
surplus reserves
2.
Appropriations to
general risk
provisions
3.
-251,80 -251,80
Appropriations to
0,000.0 0,000.0
owners (or
0 0
shareholders)
4. Other
(IV) Internal
carry-forward of
owners’ equity
1. New
79
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
(V) Specific
reserve
1. Withdrawn
for the period
2. Used in the
period
(VI) Other
1,294,9 1,688,1 3,742,7
IV. Closing 503,600 -843,22 256,902
38,493. 58,733. 56,257.
balance ,000.00 9.50 ,260.27
19 09 05
8. Statement of changes in owners’ equity of the Company
2014
Unit: RMB Yuan
2014
Other equity instruments Other
Less: Total
Item Share Capital comprehe Specific Surplus Retaine
Preferre Perpetu treasury owners’
capital Other reserve nsive reserve reserve d profit
d shares al bonds stock equity
incomes
I. Balance at the 1,589,2
503,600, 1,247,162 -843,229. 251,800,0 3,590,996
end of the previous 77,915.
000.00 ,107.35 50 00.00 ,792.85
year 00
Add: change of
accounting policy
Correction of
errors in previous
80
2014 Annual Report of Anhui Gujing Distillery Company Limited
periods
Other
II. Balance at the 1,589,2
503,600, 1,247,162 -843,229. 251,800,0 3,590,996
beginning of the 77,915.
000.00 ,107.35 50 00.00 ,792.85
year 00
III. Increase/
decrease in the 17,512,83 400,802 418,315,2
period (“-” means 3.57 ,374.98 08.55
decrease)
(I) Total
17,512,83 577,062 594,575,2
comprehensive
3.57 ,374.98 08.55
incomes
(II) Capital
increased and
reduced by owners
1. Common
shares increased
by shareholders
2. Capital
increased by
holders of other
equity instruments
3. Amounts
of share-based
payments
recognized in
owners’ equity
4. Other
-176,26
(III) Profit -176,260,
0,000.0
distribution 000.00
0
1.
Appropriations to
surplus reserves
2.
-176,26
Appropriations to -176,260,
0,000.0
owners (or 000.00
0
shareholders)
3. Other
(IV) Internal
81
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
(V) Specific
reserve
1. Withdrawn
for the period
2. Used in the
period
(VI) Other
1,990,0
IV. Closing 503,600, 1,247,162 16,669,60 251,800,0 4,009,312
80,289.
balance 000.00 ,107.35 4.07 00.00 ,001.40
98
2013
Unit: RMB Yuan
2013
Other equity instruments Other
Less: Total
Item Share Capital comprehe Specific Surplus Retaine
Preferre Perpetu treasury owners’
capital Other reserve nsive reserve reserve d profit
d shares al bonds stock equity
incomes
I. Balance at the 503,60 1,219,7
1,247,162 2,093,537 213,634,7 3,186,191
end of the previous 0,000.0 00,782.
,107.35 .88 04.46 ,132.27
year 0 58
Add: change of
accounting policy
Correction of
errors in previous
82
2014 Annual Report of Anhui Gujing Distillery Company Limited
periods
Other
II. Balance at the 503,60 1,219,7
1,247,162 2,093,537 213,634,7 3,186,191
beginning of the 0,000.0 00,782.
,107.35 .88 04.46 ,132.27
year 0 58
III. Increase/
decrease in the -2,936,76 38,165,29 369,577 404,805,6
period (“-” means 7.38 5.54 ,132.42 60.58
decrease)
(I) Total
-2,936,76 659,542 656,605,6
comprehensive
7.38 ,427.96 60.58
incomes
(II) Capital
increased and
reduced by owners
1. Common
shares increased
by shareholders
2. Capital
increased by
holders of other
equity instruments
3. Amounts
of share-based
payments
recognized in
owners’ equity
4. Other
-289,96
(III) Profit 38,165,29 -251,800,
5,295.5
distribution 5.54 000.00
4
1.
38,165,29 -38,165,
Appropriations to
5.54 295.54
surplus reserves
2.
-251,80
Appropriations to -251,800,
0,000.0
owners (or 000.00
0
shareholders)
3. Other
(IV) Internal
83
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
(V) Specific
reserve
1. Withdrawn
for the period
2. Used in the
period
(VI) Other
503,60 1,589,2
IV. Closing 1,247,162 -843,229. 251,800,0 3,590,996
0,000.0 77,915.
balance ,107.35 50 00.00 ,792.85
0 00
Note 3: Company Profile
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
84
2014 Annual Report of Anhui Gujing Distillery Company Limited
are listed in Shenzhen Stock exchange.
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 235 million, the total amount of shares were 235 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 2014, the accumulated total amount of issued capital was 503.6 million shares, see the note 6.24.
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.
85
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 27 April, 2015. 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
(Ministry of Finance issued order No.33, the Ministry of Finance revised order No.76) on15 February 2006, and revised Accounting Standards
(order 41 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 (2014 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 2014. 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 (2014 Revision) issued by China Securities Regulatory Commission (CSRC) in 2014.
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 1 January to 31 December.
4.2 Operating cycle
Normal business cycle is realized by the Company in cash or cash equivalents from the purchase of assets for processing until. The company
has a 12 -month operating cycle, and its assets and liabilities as liquidity criteria for the classification.
4.3 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.
4.4 Business combination
86
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.4.1 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.
4.4.2 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.
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 adjusted.
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
87
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
For a business combination not involving enterprise under common control, which achieved in stages that involves multiple exchange
transactions, according to ―The notice of the Ministry of Finance on the issuance of Accounting Standards Interpretation No. 5‖ (CaiKuai [2012] No.
19) and Article 51 of ―Accounting Standards for Business Enterprises No.33 - Consolidated Financial Statements‖ on the ―package deal‖ criterion
(see Note 4.5.2), to judge the multiple exchange transactions whether they are the "package deal". If it belong to the ―package deal‖ in reference to
the preceding paragraphs of this section and the Notes described in 4.13 ―long-term investment‖ accounting treatment, if it does not belong to the
―package deal‖ to distinguish the individual financial statements and the consolidated financial statements related to the accounting treatment:
In the individual financial statements, the total value of the book value of the acquiree's equity investment before the acquisition date and the
cost of new investment at the acquisition date, as the initial cost of the investment, the acquiree's equity investment before the acquisition date
involved in other comprehensive income, in the disposal of the investment will be in other comprehensive income associated with the use of
infrastructure and the acquiree directly related to the disposal of assets or liabilities of the same accounting treatment (that is, except in accordance
with the equity method of accounting in the defined benefit plan acquiree is remeasured net changes in net assets or liabilities other than in the
corresponding share of the lead, and the rest into the current investment income).
In the combination financial statements, 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
previously-held equity interest in the acquiree involved in other comprehensive income and other comprehensive income associated with the
purchase of the foundation should be used party directly related to the disposal of assets or liabilities of the same accounting treatment (that is,
except in accordance with the equity method of accounting in the acquiree is remeasured defined benefit plans other than changes in net liabilities
or net assets due to a corresponding share of the rest of the acquisition date into current investment income).
4.5 Preparation of the consolidated financial statements
4.5.1 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.
88
2014 Annual Report of Anhui Gujing Distillery Company Limited
Once the change in the relevant facts and circumstances leading to the definition of the relevant elements involved in the control of the change,
the company will be re-evaluated.
4.5.2 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’/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. Other comprehensive income related to the former subsidiary's equity investment, using the foundation and the acquiree
directly related to the disposal of the same assets or liabilities are accounted when the control is lost (ie, in addition to the former subsidiary is
remeasured at the net defined benefit plan or changes in net assets and liabilities resulting from, the rest are transferred to the current investment
income). The retained interest is subsequently measured according to the rules stipulated in the - ―Chinese Accounting Standards for Business
89
2014 Annual Report of Anhui Gujing Distillery Company Limited
Enterprises No.2 - Long-term equity investment‖ or ―Chinese Accounting Standards for Business Enterprises No.22 - Determination and
measurement of financial instruments‖. See Note 4.13 Long-term equity investments and Note 4.9 Financial instruments for details.
The company used multiple transactions step deal with disposal of the subsidiary's equity investment until the loss of control, need to distinguish
between equity until the disposal of a subsidiary's loss of control over whether the transaction is package deal. Terms of the transaction disposition
of equity investment in a subsidiary, subject to the following conditions and the economic impact of one or more of cases, usually indicates that
several transactions should be accounted for as a package deal:①these transactions are considered simultaneously, or in the case of mutual
influence made, ②these transactions as a whole in order to achieve a complete business results; ③the occurrence of a transaction depends on
occurs at least one other transaction; ④a transaction look alone is not economical, but when considered together with other transaction is
economical. If they does not belong to the package deal, each of them separately, as the case of a transaction in accordance with ―without losing
control over the disposal of a subsidiary part of a long-term equity investments― (see Note 4.13.2, 4)) and ―due to the disposal of certain equity
investments or other reasons lost control of a subsidiary of the original‖ (see previous paragraph) principles applicable accounting treatment. Until
the disposal of the equity investment loss of control of a subsidiary of the transactions belonging to the package deal, the transaction will be used
as a disposal of a subsidiary and the loss of control of the transaction. However, before losing control of the price of each disposal entitled to share
in the net assets of the subsidiary's investment corresponding to the difference between the disposal, recognized in the consolidated financial
statements as other comprehensive income, loss of control over the transferred together with the loss of control or loss in the period.
4.6 Joint arrangement
A joint arrangement is an arrangement of which two or more parties have joint control. A joint arrangement is either a joint operation or a joint
venture, depending of the rights and obligation of the Company in the joint arrangement. A joint operation is a joint arrangement whereby the
Company has rights to the assets, andobligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the
Company has rights to the net assets of the arrangement.
The Company accounts for joint ventures using the equity method, see Note 4.13.2.2 for details.
The company, a joint operator, recognizes in relation to its interest in a joint operation:(a)its assets, including its share of any assets held
jointly;(b)its liabilities, including its share of any liabilities incurred jointly;(c)its revenue from the sale of its share of the output arising from the joint
operation;(d)its share of the revenue from the sale of the output by the joint operation; and (e)its expenses, including its share of any expenses
incurred jointly.
When the Company enters into a transaction with a joint operation in which it is a joint operator, such as a sale or contribution of assets, the
Company, prior to disposal of the assets to a third party by the joint operation, recognizes gains and losses resulting from such a transaction only to
the extent of the other parties' interests in the joint operation. When there is evidence of a reduction in the net realizable value of the assets to be
sold or contributed to the joint operation, or of an impairment loss of those assets which is in line with provision stipulated by CAS 8, those losses
are recognized fully by the Company. When there is evidence of a reduction in the net realizable value of the assets to be purchased or of an
impairment loss of those assets, the Company shall recognize its share of those losses.
4.7 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
90
2014 Annual Report of Anhui Gujing Distillery Company Limited
measured reliably and have low risks of change.
4.8 Foreign exchange
4.8.1 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.
4.8.2 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 ①those 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, ③available-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.
4.9 Financial instruments
4.9.1 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.
4.9.2 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;
91
2014 Annual Report of Anhui Gujing Distillery Company Limited
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:
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.
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
92
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.9.3 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 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.
4.9.4 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;
93
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 norretained 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.
4.9.5 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 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 is recognized in profit or loss for the current period.
4.9.6 Derecognition of financial liabilities
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
94
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.9.7 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 gain or loss caused by the fair value change of the hedging instrument which the hedging is
highly efficiency will be recorded into specific period in accordance with the hedging accounting according the hedging relationship. Except for the
hedging above, the resulting gain and loss of other derivatives 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.
4.9.8 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.
4.9.9 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.
4.10 Receivables
The receivables by the Company include 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;
95
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 CNY 2,000,000.00 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 those 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.
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)
96
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 3 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 reversed.
4.11 Inventories
(1) Classification of inventory
The Company’s inventory mainly includes raw materials, semi-finished product, work-in-progress and finished products.
(2) Valuation method of inventories
Inventories are initially carried at the actual cost. Cost of inventories includes 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.
97
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.12 Held-for-sale assets
A non-current asset is classified as held-for-sale if all of the following conditions are satisfied:
a. the asset is immediately sellable at its current condition per usual sales term applicable to the type of assets to which it belongs;
b. the Company's has completed official decision to dispose the asset;
c. the Company has entered into irrevokable sales contract with the purchaser; and
d. the sales will be completed within one year.
Amortisation or depreciation of the held-for-sale asset ceases at the time of classification. The asset is measured at the lower of its book value
and its classification date fair value minus disposal costs upon classification. Held-for-sale non-current assets include individual assets and disposal
groups. If a disposal group satisfy the conditions of the asset group defined by CAS 8 - Asset Impairment and includes goodwill arising from
business combination allocated in accordance with CAS 8 or the disposal group is an operation with an asset group, the disposal group include
goodwill arising from business combination.
Individual non-current assets held for sale and assets of disposal groups held for sale are collectively presented on the (consolidated) statement
of financial position as a line item of current assets. Liabilities of disposal groups held for sale are collectively presented on the (consolidated)
statement of financial position as a line item of current liabilities.
A held-for-sale asset or held-for-sale disposal group is reclassified from held-for-sale when the conditions for classification of the asset (disposal
group) as held-for-sale are no longer satisfied and is measured at the lower of its classification date book value minus cumulative depreciation,
amortisation and impairment as if it has not been reclassified as held-for-sale and it recoverable amount as of the date on which the conditions for
classification of the asset (disposal group) as held-for-sale are no longer satisfied.
4.13 Long-term equity investments
Long-term equity investments referred to in this section refer to the Company invested entity has control, joint control or significant influence over
the long-term equity investments. The Company invested does not have control, joint control or significant influence over the long-term equity
investments as financial assets available for sale or at fair value and the changes included financial assets through profit or loss, which refer to the
accounting policies in Note 4. 9 ―financial instruments‖.
Joint control is the Company control over an arrangement in accordance with the relevant stipulations are common, related activities and the
arrangement must be after sharing control participants agreed to the decision-making. Significant influence is the Company s financial and
operating policies of the entity has the right to participate in decision-making, but cannot control or with other parties joint control over those
98
2014 Annual Report of Anhui Gujing Distillery Company Limited
policies.
4.13.1 Determination of Investment cost
The cost of a long-term equity investment acquired through business combination under common control is measured at the acquirer's share of
the combination date book value of the acquiree's net equity in the ultimate controller's consolidated financial statements. The difference between
the cost and book value of cash paid, non-monetary assets transferred and liabilities assumed is adjusted to capital reserves, and to retained
earnings if capital reserves is insufficient. If the consideration is transferred by way of issuing equity instruments, the face value of the equity
instruments issued is recognised in share capital and the difference between the cost of the face value of the equity instruments issued is adjusted
to capital reserves, and to retained earnings if capital reserves is insufficient. Where a business combination under common control is achieved by
multiple acquisition of the acquiree's shareholding, the multiple acquisitions shall be assessed to determine whether the multiple acquistions shall
be viewed as one single transaction. If the multiple acquistions shall be viewed as one single transaction, the multiple acquistions shall be
accounted for as one single transaction accordingly. If the multiple acquisitions shall not be viewed as one single transaction, the difference
between the cost of combination and the sum of the book value of the investment in the acquiree immediately before the combination and the book
value of the consideration transferred to acquire additional shareholding is adjusted to capital reserves, and to retained earnings if capital reserves
is insufficient. Cumulative other comprehensive income associated with the investment recognised as a result of the treatment of equity method or
available-for-sale financial assets prior to the combination is not affected by the combination.
The cost of a long-term equity investment acquired through business combination not under common control is the fair value of the assets
transferred, liabilities incurred or assumed and equity instruments issued. Where a business combination not under common control is achieved by
multiple acquisition of the acquiree's shareholding, the multiple acquisitions shall be assessed to determine whether the multiple acquistions shall
be viewed as one single transaction. If the multiple acquistions shall be viewed as one single transaction, the multiple acquistions shall be
accounted for as one single transaction accordingly. If the multiple acquisitions shall not be viewed as one single transaction, the cost of
combination is measured at the sum of book value of the investment in the acquiree immediately before the combination and cost of acquisition of
additional shareholding. If the investment prior to the combination is measured by fair value, cumulative other comprehensive income associated
with the investment prior to the combination is not affected by the combination. If the investment prior to the combination is measured as an
available-for-sale financial asset, the difference between the fair value and the book value of the investment immediately before the combination
and the associated cumulative other comprehensive income recognised prior to the combination are carried to profit or loss.
All expenses incurred directly associated with the acquisition by the acquirer, including expenditure of audit, legal services, valuation and
consultancy and other administrative expenses, are recognised in profit or loss for the period during which the acquisition occurs.
Long-term equity investments acquired not through business combination are measured at cost on initial recognition. Depending on the way of
acquisition, the cost of acquisition can be the total cash paid, the fair value of equity instrument issued, the contract price, the fair value or book
value of the assets given away in the case of non-monetary asset exchange, or the fair value of the relevant long-term equity investments. The cost
of acquisition of a long-term equity investment acquired not through business combination also includes all directly associated expenses, applicable
taxes and fees, and other necessary expenses. The cost of a long-term equity investment, which enables the Company has significant influence or
joint control over the acquiree which is achieved through additional investment, is measured as the fair value determined in accordance with CAS
22 - Financial Instruments: Recognition and Measurement plus the cost of additional investment.
99
2014 Annual Report of Anhui Gujing Distillery Company Limited
4.13.2 Subsequent Measurement
To be invested joint control (except constitute common operator) or long-term equity investments significant influence are accounted for using the
equity method. In addition, the Company's financial statements using the cost method of accounting for long-term equity can exercise control 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.
The carrying amount of an long-term equity investment measured using the equity method is adjusted by the Company's share of the investee's
net profit and other comprehensive income, which is recognised as investment income and other comprehensive income respectively. The carrying
amount of a long-term equity investment measured using the equity method is reduced by profit distribution or cash dividends announced by the
investee. The carrying amount of a long-term equity investment measured using the equity method is also adjusted by the investee's equity
movement other than net profit, other comprehensive income and profit distribution, which is adjusted to capital reserves. The net profit of the
investee is adjusted by the fair value of the investee's identifiable assets as at acquistion. The financial statements and hence the net profit and
other comprehensive income of an investee which does not adopt accounting policies or accounting period uniform with the Company is adjusted
by the Company's accounting policies and accounting period. The Company's share of unrealised profit or loss arising from related party
transactions between the Company and an associate or joint venture is deducted from investment income. Unrealised loss arising from related
party transactions between the Company and an associate or joint venture which is associated with asset impairment is not adjusted. Where assets
transferred to an associate or joint venture which form part of the Company's investment in the investee but which does not enable the Company
obtain control over the investee, the cost of the additional investment acquired is measured at the fair value of assets transferred and the difference
between the cost of the additional investment and the book value of the assets transferred is recognised in profit or loss. Where assets transferred
to an associate or joint venture form an operation, the difference between the consideration received and the book value of the assets transferred in
recognised in profit or loss. Where assets transferred from an associate or joint venture form an operation, the transaction is accounted for in
accordance with CAS 20 - Business Combination, any gain or loss is reocgnised in profit or loss.
The Company's share of an investee's net loss is limited by the sum of the book value of the long-term equity investment and other net long-term
investments in the investees. The Company has obligation to share additional net loss of the investee, the estimated share of loss recognised as
accrued liabilities and investment loss. Where the Company has unrecognised share of loss of the investee when the investee generates net profit,
the Company's unrecognised share of loss is reduced by the Company's share of net profit and when the Company's unrecognised share or loss is
eliminated in full, the Company's share of net profit, if any, is recognised as investment income.
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
100
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
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 4.5.2 applies. For disposal
of long-term equity investments in any situation other than the fore-mentioned situation, the difference between the book value of the investment
disposed and the consideration received is recognised in profit or loss.
The long-term equity investment is measured by the equity method both before and after part disposal of the investment, cumulative other
comprehensive income relevant to the investment recognised prior to the acquistion is treated in the same manner that the investee disposes the
relevant assets or liabilities proportionate to the disposal. The investee's equity movement other than net profit, other comprehensive income and
profit distribution is reocgnised in profit or loss proportionate to the disposal.
The long-term equity investment is measured at cost both before and after part disposal of the investment, cumulative other comprehensive
income relevant to the investment recognised, as a result of accounting by equity method or recognition and measurement principles applicable to
financial instruments, prior to the Company's acquisition of control over the investee is treated in the same manner that the investee disposes the
relevant assets or liabilities and recognised in profit or loss proportionate to the disposal. The investee's equity movement other than net profit,
other comprehensive income and profit distribution, as a result of accounting by equity method, is reocgnised in profit or loss proportionate to the
disposal.
The Company's control over an investee is lost due to partial disposal of investment in the investee and the Company continues to have
significant influence over the investee after the partial disposal, the investment in measured by the equity method in the Company's separate
financial statements; the Company's control over an investee is lost due to partial disposal of investment in the investee and the Company ceases
to have significant influence over the investee after the partial disposal, the investment in measured in accordance with the recognition and
measurement principles applicable to financial instruments in the Company's separate financial statements and the difference between the fair
value and the book value of the remaining investment at the date of loss of control is recognised in profit or loss. Cumulative other comprehensive
income relevant to the investment recognised, as a result of accounting by equity method or recognition and measurement principles applicable to
financial instruments, prior to the Company's acquisition of control over the investee is treated in the same manner that the investee disposes the
relevant assets or liabilities on the date of loss of control. The investee's equity movement other than net profit, other comprehensive income and
profit distribution, as a result of accounting by equity method, is reocgnised in profit or loss when control is lost. Where the remaining investment is
measured by equity method, the fore-mentioned other comprehensive income and other equity movement are recognised in profit or loss
proportionate to the disposal; Where the remaining investment is measured in accordance with the recognition and measurement principles
101
2014 Annual Report of Anhui Gujing Distillery Company Limited
applicable to financial instruments, the fore-mentioned other comprehensive income and other equity movement are recognised in profit or loss in
full.
The Company's joint control or significant influence over an investee is lost due to partial disposal of investment in the investee, the remaining
investment in the investee is measured in accordance with the recognition and measurement principles applicable to financial instruments, the
difference between the fair value and the book value of the remaining investment at the date of loss of joint control or significant influence is
recognised in profit or loss.Cumulative other comprehensive income relevant to the investment recognised, as a result of accounting by equity
method, prior to the partial disposal is treated in the same manner that the investee disposes the relevant assets or liabilities on the date of loss of
joint control or significant influence. The investee's equity movement other than net profit, other comprehensive income and profit distribution is
reocgnised in profit or loss when joint control or significant influence is lost.
The Company's control over an investee is lost through multiple disposals and the multiple disposals shall be viewed as one single transaction,
the multiple disposals is accounted for one single transaction which result in the Company's loss of control over the investee. Each difference
between the consideration received and the book value of the investment disposed is recognised in other comprehensive income and reclassified in
full to profit or loss at the time when control over the investee is lost.
4.14 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 it 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 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 cannot 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.
4.15 Fixed assets
102
2014 Annual Report of Anhui Gujing Distillery Company Limited
(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 equipment 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 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.
4.16 Construction in progress
103
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 4.20.
4.17 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.
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.
4.18 Intangible assets
4.18.1 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
104
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.18.2 Research and development cost
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.
4.18.3 Impairment of intangible assets
Impairment and provisions of intangible assets are disclosed on Note 4.20.
4.19 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.
4.20 Impairment of long-term 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
105
2014 Annual Report of Anhui Gujing Distillery Company Limited
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
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.
4.21 Employee Benefits
The employee benefits of the company include short-term employee benefits, post-employment benefits, termination benefits and other
long-term employee benefits:
Short-term employee benefits includes wages, bonuses, allowances and subsidies, welfare, health insurance , maternity insurance, work injury
insurance, housing funds, labor union funds, employee education funds, non-monetary benefits and etc. The company provides services
accounting period in which an employee of the company will be short-term employee benefits are recognized as liabilities actually incurred and loss
account or the costs associated with the asset. The non -monetary benefits are measured at fair value.
Post-employment benefits include defined contribution plans and defined benefit plans. Defined contribution plan which includes the basic
old-age insurance, unemployment insurance and annuities shall be deposited in the appropriate amount accrued to the cost of related assets or
profit or loss.
Prior to the employment contracts terminate the labor relationship with employees, or to encourage employees to accept voluntary redundancy
compensation proposals in this company cannot unilaterally withdraw due to termination of employment or layoff proposal termination benefits
provided, and the company recognized costs related to both pay and termination benefits related to the restructuring which is early to confirm
employee benefits liabilities, and recorded as profit or loss. However, termination benefits expected at the end of the annual reporting period of
twelve months cannot be fully paid, in accordance with other long-term employee benefits processing.
106
2014 Annual Report of Anhui Gujing Distillery Company Limited
Retirement plan is using the same principle as the layoff. The company will stop providing services from the employee to be paid during the
normal retirement date of retired staff salaries, social insurance and etc., when in compliance with the conditions on recognition in profit or loss
(termination benefits).
Other long-term employee benefits are provided by the company to employees, in line with defined contribution plans, the accounting treatment
in accordance with a defined contribution plan, in addition to the set-benefit plans in accordance with the accounting treatment.
4.22 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 determine 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.
On balance sheet date the Company performs relate obligation that consider risk, incertitude, time value of currency of contingency factor.
According to the best estimate of the expenditure required to settle the present obligation for estimated liabilities measured.
If the expenditure required to settle the liability is expected to be fully or partly compensated by a third party, to determine the amount of
compensation will be received at the basic, separately recognized as an asset, and is recognized in the amount of compensation does not exceed
the carrying value of estimated liabilities.
4.23 Revenue
(1) Revenue from sales of goods
Revenue from sales of goods is recognized 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 recognized 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 recognized 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 recognized 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
107
2014 Annual Report of Anhui Gujing Distillery Company Limited
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 recognized as cost reimbursement received or to be
received, if any, and cost incurred is recognized in profit or loss for the period in which the cost is incurred. No revenue is recognized if cost
reimbursement is 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.
4.24 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.
The government grants which were acquired by the Company will be used to purchase or otherwise form become long-term assets will be
defined as grant related to the assets; the others will be defined as grants related to the income. If the files have not clearly defined government
grants objects, it will be divided in the following manner compartmentalize the grants related to the assets and grants related to the income: (1)
government documents defined specific projects targets, according to the relative proportion of the budgets of specific items included the
expenditure of to form assets and the expenditure will be charged into expense to be divided, the division ratio required at each balance sheet date
for review and make changes if necessary; (2) government documents to make a general presentation purposes only, does not specify a particular
project, as 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.
When received the government grants actually, recognized and measured them by the actual amount received. However, there is strong
evidence that the end of fiscal support policies able to meet the conditions specified in the relevant funds are expected to be able to receive
financial support, measured at the amount receivable. Government grants are measured according to the amount receivable shall also comply with
108
2014 Annual Report of Anhui Gujing Distillery Company Limited
the following conditions: (1)grants receivable of government departments issued a document entitled have been confirmed, or could reasonably are
estimated in accordance with the relevant provisions of its own official release of financial resources management approach, and the expected
amount of a material uncertainty which does not exist; (2) it is based on the local financial sector to be officially released and financial support for
the project and its financial fund management approach voluntarily disclosed in accordance with the provisions of ―Regulations on Disclosure
Government Information‖, and the management approach should be (inclusive of any compliance business conditions may apply), and not
specifically formulated for specific businesses;(3) related grants approval has been clearly committed the deadline, and is financed by the proceeds
of a corresponding budget as a guarantee, so that will be received within the prescribed period with the a reasonable assurance; (4) according to
the specific circumstances of the Company and the subsidy matter, should satisfy the other conditions (if any).
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.
4.25 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 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
109
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
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.
4.26 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
110
2014 Annual Report of Anhui Gujing Distillery Company Limited
be transferred. An operating lease is a lease other than a finance lease.
4.26.1 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.
4.26.2 The Company as leasor under operating Lease
Lease income from operating leases shall be recognized by the leasor 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.
4.26.3 The Company as Lessee under financing Lease
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.
4.26.4 In the case of the lessor 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.
4.27 Changes in major accounting policies and accounting estimates
4.27.1 Change of accounting policies
(1) Accounting policies due to the implementation of new accounting standards result in changes
CAS 39 - Fair Value Measurement, CAS 30 - Financial Reporting (Revised in 2014), CAS 9 - Employment Benefits (Revised in 2014), CAS 33 -
111
2014 Annual Report of Anhui Gujing Distillery Company Limited
Consolidated Financial Statements (Revised in 2014), CAS 40 - Joint Arrangement, CAS 2 - Long-term Equity Investments (Revised in 2014) and
CAS 41 - Interests in Other Entities were issued by the Ministry of Finance in early 2014 by CaiKuai [2014]6, CaiKuai [2014]7,
CaiKuai[2014]8,CaiKuai[2014]10,CaiKuai[2014]11,CaiKuai[2014]14,and CaiKuai [2014]16 which order adoption of the above standards as from 1
July 2014 by all entities currently adopting CAS with encouraged early adoption by entities with overseas listing. CAS 37 - Financial Instrument
Disclosure (Revised in 2014) was issued by the Ministry by CaiKuai [2014]23 which orders presentation of financial instruments in accordance with
CAS 37 as from the year ended 31 December 2014.
The Company adopted CAS 39, CAS 30 (Revised), CAS9 (Revised), CAS 33 (Revised), CAS 40, CAS 2 (Revised) and CAS 41 on 1 July 2014
and adopted CAS 37 (Revised) during the preparation of the financial statement for the year ended 31 December 2014. The financial statements
are adjusted in accordance with the relevant transitional provisions required by the new or revised CAS. Impacts of adoption the new or revised
CAS are as follow.
Impact on the financial statements
Change of accounting policies and the
CAS as at 1 January 2014
associated impact
Line item AmountIncrease (+) / Decrease (-)
Deferred income 43,455,409.03
CAS 30 - Financial In accordance with the relevant
Reporting (Revised in requirements of CAS 30 (Revised) and the Other current liabilities -3,112,595.04
2014) associated application guidance.
Other non-current liabilities -40,342,813.99
4.27.2 Change of accounting estimates
There is no significant change of accounting estimates for the company during the reporting period.
4.28 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:
4.28.1 Classification of lease
The Company classifies leases as operating lease and financing lease according to the rule stipulated in the Accounting Standard for Business
112
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.28.2 Allowance for bad debts
According to the relevant accounting policies of the Company in receivables, allowance method is used for bad debt’s calculation. The
impairment 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.
4.28.3 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.
4.28.4 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.
4.28.5 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.
4.28.6 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
113
2014 Annual Report of Anhui Gujing Distillery Company Limited
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.
4.28.7 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.
4.28.8 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.
4.28.9 Income tax
There are some transactions where ultimate tax treatments and calculations have uncertainties in the Company’s everyday operation. Whether
there are 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.
4.28.10 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 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 the accrued liabilities may affect the profit or loss in future.
Note 5: Taxation
114
2014 Annual Report of Anhui Gujing Distillery Company Limited
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%.
The consumption taxes have been provided at the rate of CNY 1.00 yuan per kg or 1,000 ml
Consumption tax 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 reporting
and construction surcharge 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 reporting
Education surcharge
period, and exempt and deductible tax at the rate of 3%.
Sum of VAT payable, consumption duty payable and business tax payable for the reporting
Local education surcharge
period, and exempt and deductible tax at the rate of 2%.。
Corporate income tax Income tax is calculated with the ratio of 25%.
Note 6: Notes to significant elements of the financial statements
Unless otherwise stated (incl. notes to significant elements of the financial statements is), the current year is 2014, prior year is 2013
respectively.
6.1 Monetary funds
Items Balance as at 31/12/2014 Balance as at 31/12/2013
Cash in hand 349,833.07 251,743.25
Bank deposit 713,744,608.33 1,381,636,737.50
Other monetary fund 4,366,001.39 42,230.21
Total 718,460,442.79 1,381,930,710.96
Including: The total amount of deposit abroad 0.00 0.00
Note: At the end of current year, the fixed deposit of CNY 36,100,000.00 had been impawned to get the bank acceptance bill.
6.2 Financial assets measured by fair value with changes in fair value recognised in profit or loss
6.2.1 Disclosure by classification
Items Balance as at 31/12/2014 Balance as at 31/12/2013
Held for trading financial assets 303,919.60 0.00
Including: invest in equity instrument 303,919.60 0.00
115
2014 Annual Report of Anhui Gujing Distillery Company Limited
Items Balance as at 31/12/2014 Balance as at 31/12/2013
Total 303,919.60 0.00
6.3 Notes receivable
6.3.1 Disclosure by classification
Classification Balance as at 31/12/2014 Balance as at 31/12/2013
Bank acceptance 505,893,430.66 154,408,425.31
Total 505,893,430.66 154,408,425.31
6.3.2 The notes that has been impawned at the end of current year
Item Amount
Bank acceptance 87,250,000.00
Total 87,250,000.00
6.3.3 The notes that has been endorsed to other parties but not yet due at the end of current year
Item Amount derecognised as at 31/12/2014 Amount not derecognised as at 31/12/2014
Bank acceptance 108,065,154.39 0.00
Total 108,065,154.39 0.00
6.4 Accounts receivable
6.4.1 Disclosure by classification
Balance as at 31/12/2014
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Accounts receivable of individual significance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Accounts receivable portfolio subject to
5,393,735.97 100.00 1,055,782.71 19.57 4,337,953.26
impairment by credit risk:
Accounts receivable of individually insignificance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Total 5,393,735.97 100.00 1,055,782.71 19.57 4,337,953.26
(Continued)
Items Balance as at 31/12/2013
116
2014 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Accounts receivable of individual significance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Accounts receivable portfolio subject to
7,253,995.93 100.00 879,525.94 12.12 6,374,469.99
impairment by credit risk:
Accounts receivable of individually insignificance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Total 7,253,995.93 100.00 879,525.94 12.12 6,374,469.99
Disclosure by age:
Balance as at 31/12/2014
Age
Carrying amount Allowance for bad debt % of total
Within 1 year
Including: within 6 months 3,221,336.07 32,213.36 1.00
7– 12 months
Subtotal within one year 3,221,336.07 32,213.36 1.00
1-2 years 1,104,996.00 110,499.60 10.00
2-3 years 308,668.31 154,334.16 50.00
Over 3years 758,735.59 758,735.59 100.00
Total 5,393,735.97 1,055,782.71 19.57
6.4.2 Recognisation, recovery and reversal of allowance for bad debt
The amount of allowance for bad debts recognised during the year is CNY176,256.77.
6.4.3 There has no accounts receivable written off during the current reporting period.
6.4.4 Details of top five accounts receivable
The total amount of top five accounts receivablessummaried by debtors as at the end of current year is CNY 2,449,114.17, accounting for
45.41% of the total accounts receivable as at the end of current year, the total corresponding allowance for bad debts is CNY431,106.64.
6.5 Advances to suppliers
6.5.1 Disclosure by age
Age Balance as at 31/12/2014 Balance as at 31/12/2013
117
2014 Annual Report of Anhui Gujing Distillery Company Limited
Amount % of total Amount % of total
Within 1 year 35,406,358.00 99.14 90,017,564.50 99.78
1 to 2 years 163,485.98 0.46 200,134.00 0.22
2 to 3 years 141,774.00 0.40 0.00 0.00
Total 35,711,617.98 100.00 90,217,698.50 100.00
6.5.2 Details of top five advance to suppliers
The total amount of top five advance to suppliers as at the end of current year is CNY28,979,409.37, accounting for 81.15% of the total advance
to suppliers.
6.6 Interest receivables
Items Balance as at 31/12/2014 Balance as at 31/12/2013
Interest of fixed deposit 4,274,666.66 0.00
Total 4,274,666.66 0.00
6.7 Other receivable
6.7.1 Disclosure by classification
Balance as at 31/21/2014
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Other receivable of individual significance subject to
50,727,440.55 85.92 50,727,440.55 100.00 0.00
individually assessment for impairment
Other receivable portfolio subject to impairment by
8,310,068.17 14.08 342,164.93 4.12 7,967,903.24
credit risk:
Other receivable of individually insignificance subject
0.00 0.00 0.00 0.00 0.00
to individually assessment for impairment
Total 59,037,508.72 100.00 51,069,605.48 86.50 7,967,903.24
(Continued)
Balance as at 31/21/2013
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Other receivable of individual significance subject to
51,109,940.55 88.79 51,109,940.55 100.00 0.00
individually assessment for impairment
118
2014 Annual Report of Anhui Gujing Distillery Company Limited
Balance as at 31/21/2013
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Other receivable portfolio subject to impairment by
6,453,210.58 11.21 156,884.38 2.43 6,296,326.20
credit risk:
Other receivable of individually insignificance subject
0.00 0.00 0.00 0.00 0.00
to individually assessment for impairment
Total 57,563,151.13 100.00 51,266,824.93 89.06 6,296,326.20
① Other receivables of individual significance and subject to individual impairment assessment
Carrying Allowance for Rate of
Debtor Reason for allowance
amount bad debt allowance(%)
Enterprise is in the proceeding of
Jianqiao Securities 11,840,500.00 11,840,500.00 100.00
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 50,727,440.55 50,727,440.55
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 31/12/2014
Age
Other receivable Allowance for bad debt % of total
Within 1 year
Including: within 6 months 6,329,797.87 63,297.97 1.00
7-12 months 907,978.33 45,398.92 5.00
Subtotal within one year 7,237,776.20 108,696.89 1.50
1-2 years 830,379.81 83,037.98 10.00
2-3 years 182,964.20 91,482.10 50.00
Over 3years 58,947.96 58,947.96 100.00
119
2014 Annual Report of Anhui Gujing Distillery Company Limited
Balance as at 31/12/2014
Age
Other receivable Allowance for bad debt % of total
Total 8,310,068.17 342,164.93 4.12
6.7.2 Recognization, recovery and reversal of allowance for bad debt
The amount of allowance for bad debts recognized during the current year is CNY185,280.55, the reversal of the bad debt during the current
year is CNY382,500.00.
The important bad debt reversal in 2014 is listed as below:
Debt Amount that written off Way to get money back
Jianqiao Securities 382,500.00 The property distribution of the bankrupt
Total 382,500.00
The reason to write off the bad debt is the property distribution of the bankrupt of Jianqiao Securities.
6.7.3 The situation of other receivable the is written off in current year
No other receivable is written off during current year.
6.7.4 The classification of other receivable
Nature Balance at 31/12/2014 Balance at 31/12/2013
Invest in securities 50,727,440.55 51,109,940.55
Deposit 1,786,964.87 1,547,847.92
Loan for business trip 3,772,242.50 2,367,160.59
Rent and water, electric and gas expense 903,964.37 400,752.34
Other 1,846,896.43 2,137,449.73
Total 59,037,508.72 57,563,151.13
6.7.5 Details of top five other receivable:
Balance at the year % of total Allowance balance at the
Debtor nature age
end amount year end
The first Invest in securities 29,502,438.53 Over 3 years 49.97 29,502,438.53
The second Invest in securities 11,840,500.00 Over 3 years 20.06 11,840,500.00
The third Invest in securities 9,384,502.02 Over 3 years 15.9 9,384,502.02
Deposit on contracts
The forth 689,658.09 Within 6 months 1.17 6,896.58
and guarantee deposit
The fifth Deposit on contracts 500,000.00 1 to 2 years 0.85 50,000.00
120
2014 Annual Report of Anhui Gujing Distillery Company Limited
Balance at the year % of total Allowance balance at the
Debtor nature age
end amount year end
total — 51,917,098.64 — 87.95 50,784,337.13
6.8 Inventories
6.8.1 Disclosure by classification
Balance as at 31/12/2014
Items
Carrying amount before impairment allowance Impairment allowance Net carrying amount
Raw material 112,077,576.03 8,700,056.12 103,377,519.90
Work in progress 1,061,359,515.77 0.00 1,061,359,515.77
Finished goods 67,034,474.15 4,588,735.74 62,445,738.42
Total 1,240,471,565.95 13,288,791.86 1,227,182,774.09
(Continued)
Balance as at 31/12/2013
Items
Carrying amount before impairment allowance Impairment allowance Net carrying amount
Raw material 97,581,058.67 4,164,570.23 93,416,488.44
Work in progress 865,270,677.73 0.00 865,270,677.73
Finished goods 122,409,398.01 6,063,426.88 116,345,971.13
Total 1,085,261,134.41 10,227,997.11 1,075,033,137.30
6.8.2 Impairment allowance for inventories
Balance as at Increase in current year Decrease in current year Balance as at
Items
31/12/2013 Accrual Other Recovered or Written off Other 31/12/2014
Raw material 4,164,570.23 6,771,665.63 0.00 2,236,179.74 0.00 8,700,056.12
Self-manufactured
0.00 0.00 0.00 0.00 0.00 0.00
semi-finished goods
Finished goods 6,063,426.88 1,246,072.95 0.00 2,720,764.09 0.00 4,588,735.74
Total 10,227,997.11 8,017,738.58 0.00 4,956,943.83 0.00 13,288,791.86
6.8.3 The basis of recognizing impairment allowance and the reason of recovering or writing off the impairment allowance for inventories
121
2014 Annual Report of Anhui Gujing Distillery Company Limited
The reason of recovering
The basis of recognition of impairment The reasons for inventory
Items impairment allowance for
allowance for inventories impairment write-off at current year
inventories
Market prices decrease, and resulting in raw disposal of materials that has recogn
Raw material material’s net realizable value lower than ised the impairement provision in the
cost current period
Market prices decrease, and resulting in disposal of products that has
Finished goods Finished goods’ net realizable value lower recognised the impairement
than cost provision in the current period
6.9 Other current assets
Items Carrying amounts as at 31/12/2014 Carrying amounts as at 31/12/2013
Financial products 1,320,000,000.00 900,000,000.00
Repurchase of government pledged bond 180,712,225.81 80,093,922.21
Deductible tax 840,250.30 0.00
Total 1,501,552,476.11 980,093,922.21
6.10 Available-for-sale financial assets
6.10.1 The situation of available-for-sale financial assets
Carrying amounts as at 31/12/2014 Carrying amounts as at 31/12/2013
Items Net carrying Net carrying
Carrying amounts Impairment Carrying amounts Impairment
amounts amounts
Available for sale equity instruments 65,332,932.00 65,332,932.00 24,075,687.00 24,075,687.00
Including: measured by fair value 65,332,932.00 65,332,932.00 24,075,687.00 24,075,687.00
Measured by cost 0.00 0.00 0.00 0.00
Other 23,000,000.00 23,000,000.00 0.00 0.00
Total 88,332,932.00 88,332,932.00 24,075,687.00 24,075,687.00
6.10.2 The available for sale financial asset which is measured by fair value at the year end
Equity instrument Debt instrument
Classification of the available for sale financial asset Total
available for sale available for sale
122
2014 Annual Report of Anhui Gujing Distillery Company Limited
Equity instrument Debt instrument
Classification of the available for sale financial asset Total
available for sale available for sale
The cost of the equity instrument or the amortized cost of the
43,106,793.24 0.00 43,106,793.24
debt instrument
Fair value 65,332,932.00 0.00 65,332,932.00
The amount of the fair value change that will be added to other
22,226,138.76 0.00 22,226,138.76
comprehensive income
Impair amount 0.00 0.00 0.00
6.10.3 The measurement of the cost of available for sale financial assets at the end of current year
Carrying amounts as at 31/12/2014 Impairment
Carrying Carrying Carrying Increase in Carrying
Investee Increase in Decrease in Decrease in
amounts as at amounts as at amounts as at current amounts as at
current year current year current year
31/12/2013 31/12/2014 31/12/2013 year 31/12/2014
Anjin No.11
group trust 0.00 23,000,000.00 0.00 23,000,000.00 0.00 0.00 0.00 0.00
plan
Total 0.00 23,000,000.00 0.00 23,000,000.00 0.00 0.00 0.00 0.00
6.11 Investment property
6.11.1 Investment property measured using the historical cost convention
Items Houses and buildings Land use rights Total
1. Cost:
1.1 Balance as at 31/12/2013 74,748,266.02 2,644,592.00 77,392,858.02
1.2 Increased in current year 0.00 0.00 0.00
1.3 Decreased in current year 0.00 0.00 0.00
1.4 Balance as at 31/12/2014 74,748,266.02 2,644,592.00 77,392,858.02
2. Accumulated Depreciation and
accumulated amortization
2.1Balance as at 31/12/2013 41,838,712.45 366,065.91 42,204,778.36
2.2 Increased in current year 3,089,044.96 24,678.46 3,113,723.42
(1) Accrual or amortization 3,089,044.96 24,678.46 3,113,723.42
2.3 Decreased in current year 0.00 0.00 0.00
2.4 Balance as at 31/12/2014 44,927,757.41 390,744.37 45,318,501.78
3. Impairment allowance
123
2014 Annual Report of Anhui Gujing Distillery Company Limited
Items Houses and buildings Land use rights Total
3.1Balance as at 31/12/2013 0.00 0.00 0.00
3.2 Increased in current year 0.00 0.00 0.00
3.3 Decreased in current year 0.00 0.00 0.00
3.4 Balance as at 31/12/2014 0.00 0.00 0.00
4. Carrying amount
4.1 Carrying amount as at 31/12/2014 29,820,508.61 2,253,847.63 32,074,356.24
4.2 Carrying amount as at 31/12/2013 32,909,553.57 2,278,526.09 35,188,079.66
6.12 Fixed assets
6.12.1 Circumstance of fixed assets
Houses and Office equipment
Items Machineries Vehicles Total
buildings and other
1. Cost:
1.1 Balance as at 31/12/2013 1,247,871,397.32 517,454,256.43 47,016,731.79 50,756,502.46 1,863,098,888.00
1.2 Increased in current year 342,942,288.12 237,193,928.33 5,102,388.85 7,480,206.92 592,718,812.22
(1) Purchase 0.00 28,623,088.26 3,280,166.63 5,275,922.96 37,179,177.85
(2) Transferred from
342,942,288.12 208,570,840.07 1,822,222.22 2,204,283.96 555,539,634.37
construction in-progress
1.3 Decreased in current year 14,031,810.92 18,423,677.27 2,655,390.77 1,883,535.93 36,994,414.89
(1) Disposal or scrap 14,031,810.92 15,357,737.51 2,655,390.77 1,883,535.93 33,928,475.13
(2)Transfer to construction
in-progress for technical 0.00 3,065,939.76 0.00 0.00 3,065,939.76
improvement
1.4 Balance as at 31/12/2014 1,576,781,874.52 736,224,507.49 49,463,729.87 56,353,173.45 2,418,823,285.33
2. Accumulated Depreciation
2.1 Balance as at 31/12/2013 331,582,943.53 189,488,293.37 29,340,283.66 39,413,076.51 589,824,597.07
2.2 Increased in current year 56,540,211.63 59,042,535.62 8,745,334.02 6,327,761.21 130,655,842.48
(1) Accrual 56,540,211.63 59,042,535.62 8,745,334.02 6,327,761.21 130,655,842.48
2.3 Decreased in current year 11,531,800.32 16,522,425.37 2,575,079.05 1,849,665.23 32,478,969.97
(1) Disposal or scrap 11,531,800.32 13,893,838.72 2,575,079.05 1,849,665.23 29,850,383.32
124
2014 Annual Report of Anhui Gujing Distillery Company Limited
Houses and Office equipment
Items Machineries Vehicles Total
buildings and other
(2)Transfer to construction
in-progress for technical 0.00 2,628,586.65 0.00 0.00 2,628,586.65
improvement
2.4 Balance as at 31/12/2014 376,591,354.84 232,008,403.62 35,510,538.63 43,891,172.49 688,001,469.58
3. Impairment allowance
3.1Balance as at 31/12/2013 4,264,099.10 1,860,758.88 0.00 667,680.36 6,792,538.34
3.2 Increased in current year 0.00 693,212.66 0.00 805.45 694,018.11
(1) Accrual 0.00 693,212.66 0.00 805.45 694,018.11
3.3 Decreased in current year 130,722.00 0.00 0.00 668,485.81 799,207.81
(1) Disposal or scrap 130,722.00 0.00 0.00 668,485.81 799,207.81
3.4 Balance as at 31/12/2014 4,133,377.10 2,553,971.54 0.00 0.00 6,687,348.64
4. Carrying amount
4.1 Carrying amount as at
1,196,057,142.58 501,662,132.33 13,953,191.24 12,462,000.96 1,724,134,467.11
31/12/2014
4.2 Carrying amount as at
912,024,354.69 326,105,204.18 17,676,448.13 10,675,745.59 1,266,481,752.59
31/12/2013
6.12.2 Fixed assets with pending ownership registration
Item Carrying value Depreciation Impair Book value Notes
Houses and buildings 15,719,043.63 11,411,262.48 4,133,377.10 174,404.05
Machineries 11,408,610.31 8,824,987.29 2,553,971.54 29,651.48
合计 27,127,653.94 20,236,249.77 6,687,348.64 204,055.53
6.12.3 Fixed assets rented out by operation lease
Item Book value at 31/12/2014
Machineries 3,247,873.78
Vehicles 21,712.59
Office equipment and others 21,769.70
Total 3,291,356.07
125
2014 Annual Report of Anhui Gujing Distillery Company Limited
6.12.4 Fixed assets with pending ownership registration.
Item Book value The reason of without certificate of title
Office building 75,528,807.57 Registration together after the industrial part finished
Fire station 1,037,761.38 Registration together after the industrial part finished
No.1 mold culture building 11,731,465.90 Registration together after the industrial part finished
No.2 mold culture building 11,731,465.90 Registration together after the industrial part finished
No.3 mold culture building 11,731,465.90 Registration together after the industrial part finished
No.4 mold culture building 12,458,445.90 Registration together after the industrial part finished
No.5 mold culture building 12,471,370.70 Registration together after the industrial part finished
No.1 distillery workshop 24,430,644.66 Registration together after the industrial part finished
No.2 distillery workshop 24,608,235.94 Registration together after the industrial part finished
No.3 distillery workshop 24,978,020.86 Registration together after the industrial part finished
No.4 distillery workshop 24,939,545.85 Registration together after the industrial part finished
Bran storehouse 37,616,381.37 Registration together after the industrial part finished
Auxiliary workshop office building 1,170,111.41 Registration together after the industrial part finished
sewage treatment station 12,331,867.44 Registration together after the industrial part finished
Blending workshop, wine storehouse and stainless
20,551,341.19 Registration together after the industrial part finished
steel tank area
No.2 and 3 stainless steel tank area 24,108,965.10 Registration together after the industrial part finished
No.1 distillery filling house 38,898,009.84 Registration together after the industrial part finished
No.2 distillery filling house 41,709,300.13 Registration together after the industrial part finished
No.6 distillery workshop 22,091,444.30 Registration together after the industrial part finished
No.8 distillery workshop 25,701,434.90 Registration together after the industrial part finished
Reception room 25,843,823.56 Registration together after the industrial part finished
Research and integrated management center 28,566,475.84 Registration together after the industrial part finished
Logistics office building, canteen, waste station 4,535,605.99 Registration together after the industrial part finished
Apartment 10,450,908.09 Registration together after the industrial part finished
Heat power station 35,838,180.30 Registration together after the industrial part finished
126
2014 Annual Report of Anhui Gujing Distillery Company Limited
Item Book value The reason of without certificate of title
No.5 distillery workshop 26,144,093.95 Registration together after the industrial part finished
No.7 distillery workshop 26,204,628.82 Registration together after the industrial part finished
No.3 distillery filling house 45,544,435.09 Registration together after the industrial part finished
Hefei sale and demand center 144,680,681.60 In progress
Wine storehouse underground 16,832,910.40 Registration together after the industrial part finished
Total 824,467,829.88
6.13 Construction in progress
6.13.1 Details of construction in progress
As at 31/12/2014 As at 31/12/2013
Carrying amount Carrying amount
Items before impairment Net carrying before impairment Net carrying
impairment allowance amount impairment allowance amount
allowance allowance
Marketing network
0.00 0.00 14,546,665.94 14,546,665.94
construction
High - quality base liquor
brewing technological 0.00 0.00 3,385,987.81 3,385,987.81
transformation projects
The base liquor hook
storage, filling and
0.00 0.00 203,661,402.39 203,661,402.39
supporting facilities
construction projects
Based liquor relocation
of the transformation and 59,085,920.04 59,085,920.04 144,262,343.13 144,262,343.13
facilities projects
Gujing Hotel decoration
0.00 0.00 3,723,224.99 3,723,224.99
project
Beijing experience center
0.00 0.00 7,401,304.94 7,401,304.94
transformation project
127
2014 Annual Report of Anhui Gujing Distillery Company Limited
As at 31/12/2014 As at 31/12/2013
Carrying amount Carrying amount
Items before impairment Net carrying before impairment Net carrying
impairment allowance amount impairment allowance amount
allowance allowance
Gujing operating network
1,753,888.88 1,753,888.88 0.00 0.00
system
The technical transform
5,036.50 5,036.50 0.00 0.00
for No.2 Glass workshop
Others 792,665.54 792,665.54 358,010.34 358,010.34
Total 61,637,510.96 0.00 61,637,510.96 377,338,939.54 0.00 377,338,939.54
6.13.2 Movement of significant construction in progress
Transferred to fixed
Carrying Increase during Other decrease Carrying amount
assets during the
Items Budgetedcost amountas at the current during the current as at
Current reporting
31/12/2013 reporting period Reporting period 31/12/2014
period
Marketing network
275,000,000.00 14,546,665.94 15,591,861.48 14,145,100.00 15,993,427.42 0.00
construction
High - quality base
liquor brewing
technological 102,000,000.00 3,385,987.81 8,341,122.52 11,727,110.33 0.00 0.00
transformation
projects
The base liquor hook
storage, filling and 586,000,000.00 203,661,402.39 54,132,772.34 255,473,811.68 2,320,363.05 0.00
supporting facilities
128
2014 Annual Report of Anhui Gujing Distillery Company Limited
Transferred to fixed
Carrying Increase during Other decrease Carrying amount
assets during the
Items Budgetedcost amountas at the current during the current as at
Current reporting
31/12/2013 reporting period Reporting period 31/12/2014
period
construction projects
Based liquor
relocation of the
800,000,000.00 144,262,343.13 213,589,798.22 257,952,298.63 40,813,922.68 59,085,920.04
transformation and
facilities projects
Gujing Hotel
7,987,386.68 3,723,224.99 3,590,707.29 0.00 7,313,932.28 0.00
decoration project
Beijing experience
center
27,797,100.00 7,401,304.94 11,989,481.79 0.00 19,390,786.73 0.00
transformation
project
Gujing operating
5,840,000.00 0.00 1,753,888.88 0.00 1,753,888.88
network system
The technical
transform for No.2 12,760,000.00 0.00 9,959,849.83 9,954,813.33 0.00 5,036.50
Glass workshop
Others 8,040,000.00 358,010.34 6,721,155.60 6,286,500.40 0.00 792,665.54
Total 1,825,424,486.68 377,338,939.54 325,670,637.95 555,539,634.37 85,832,432.16 61,637,510.96
(Continued)
The cumulative Including: interests Capitalisation rate
Weight of cost to
Stage of amount of capitalised applicable to the Source of
Items date in budgeted
completion% interest during the current current reporting
cost finance
capitalized reporting period period %
Marketing network The fund of
69.19 100.00% 0.00 0.00 0.00
construction rising shares
High - quality base The fund of
100.00 100.00% 0.00 0.00 0.00
liquor brewing rising shares
129
2014 Annual Report of Anhui Gujing Distillery Company Limited
The cumulative Including: interests Capitalisation rate
Weight of cost to
Stage of amount of capitalised applicable to the Source of
Items date in budgeted
completion% interest during the current current reporting
cost finance
capitalized reporting period period %
technological
transformation
projects
The base liquor
hook storage, filling
and supporting The fund of
81.02 100.00% 0.00 0.00 0.00
facilities rising shares
construction
projects
Based liquor
relocation of the
90.00 95.00% 0.00 0.00 0.00 Owned fund
transformation and
facilities projects
Gujing Hotel
91.57 100.00% 0.00 0.00 0.00 Owned fund
decoration project
Beijing experience
center
69.82 100.00% 0.00 0.00 0.00 Owned fund
transformation
project
Gujing operating
31.17 40.00% 0.00 0.00 0.00 Owned fund
network system
The technical
transform for No.2 78.06 95.00% 0.00 0.00 0.00 Owned fund
Glass workshop
Others 88.05 90.00% 0.00 0.00 0.00 Owned fund
Total
6.14 Intangible assets
Items Land rights Patents Software Total
130
2014 Annual Report of Anhui Gujing Distillery Company Limited
Items Land rights Patents Software Total
1. Cost:
1.1 Balance as at 31/12/2013 351,249,420.80 38,150,000.00 4,204,796.97 393,604,217.77
1.2 Increased in current year 0.00 0.00 260,683.77 260,683.77
(1) Purchase 0.00 0.00 260,683.77 260,683.77
1.3 Decreased in current year 0.00 0.00 0.00 0.00
1.4 Balance as at 31/12/2014 351,249,420.80 38,150,000.00 4,465,480.74 393,864,901.54
2. Accumulated amortization
2.1 Balance as at 31/12/2013 39,213,427.25 38,030,000.00 1,135,868.98 78,379,296.23
2.2 Increased in current year 7,991,589.79 60,000.00 945,232.92 8,996,822.71
(1) Accrual 7,991,589.79 60,000.00 945,232.92 8,996,822.71
2.3 Decreased in current year 0.00 0.00 0.00 0.00
2.4 Balance as at 31/12/2014 47,205,017.04 38,090,000.00 2,081,101.90 87,376,118.94
3. Impairment allowance
3.1 Balance as at 31/12/2013 0.00 0.00 0.00 0.00
3.2 Increased in current year 0.00 0.00 0.00 0.00
3.3 Decreased in current year 0.00 0.00 0.00 0.00
3.4 Balance as at 31/12/2014 0.00 0.00 0.00 0.00
4. Carrying amount
4.1 Carrying amount as at 31/12/2014 304,044,403.76 60,000.00 2,384,378.84 306,488,782.60
4.2 Carrying amount as at 31/12/2013 312,035,993.55 120,000.00 3,068,927.99 315,224,921.54
6.15 Long-term deferred charge
Carrying amount as Current year Amortisation for the Current year Carrying amount as at
Items
at 31/12/2013 increase current reporting period decrease 31/12/ 2014
Mold culture shelf and Mold culture bed 5,965,086.59 0.00 1,523,358.84 0.00 4,441,727.75
Transformation of high - quality base
14,748,065.24 0.00 3,721,401.72 0.00 11,026,663.52
liquor
Decoration works of hall of Fame 1,239,278.63 0.00 1,239,278.63 0.00 0.00
Decoration works of exclusive Shop 18,997,757.37 22,618,999.31 10,478,557.98 0.00 31,138,198.70
131
2014 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount as Current year Amortisation for the Current year Carrying amount as at
Items
at 31/12/2013 increase current reporting period decrease 31/12/ 2014
Decoration works of Beijing experience
0.00 19,390,786.73 0.00 0.00 19,390,786.73
center
Relocation compensation of Beijing
15,400,100.00 0.00 2,275,100.00 0.00 13,125,000.00
experience center
Decoration works of spirits culture
132,252.47 0.00 57,566.47 0.00 74,686.00
Museum
improvement project of Sewage
3,000,000.00 3,000,000.00 550,000.00 0.00 5,450,000.00
Treatment Plant
Green cost 0.00 40,381,006.50 3,282,789.43 0.00 37,098,217.07
Decoration project of Gujing villa 0.00 7,313,932.28 1,139,833.59 0.00 6,174,098.69
House leasing in Zhengzhou 437,600.06 0.00 437,600.06 0.00 0.00
Renovation works of 2011 Gujing
Distillery Zhengzhou experience center 580,764.58 0.00 580,764.58 0.00 0.00
building
Hangzhou experience club project 397,689.66 0.00 340,876.86 0.00 56,812.80
Other 0.00 6,593,111.47 2,648,123.50 0.00 3,944,987.97
Total 60,898,594.60 99,297,836.29 28,275,251.66 0.00 131,921,179.23
6.16 Deferred tax assets and deferred tax liabilities
6.16.1 Details of recognized deferred tax assets
Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Deductible Deductible
Item Deferred tax assets Deferred tax assets
temporary temporary
difference difference
Allowance for bad debt 52,125,136.19 13,031,224.13 52,146,350.87 13,036,587.74
Allowance for inventories impairment 13,288,791.86 3,322,197.97 10,227,997.11 2,556,999.28
Allowance for fixed assets impairment 6,685,305.34 1,671,326.34 6,790,495.04 1,697,623.76
Unrealized internal buying and selling
965,447.20 241,361.80 808,019.79 202,004.95
profit
Deferred income 40,839,961.86 10,209,990.47 43,455,409.03 10,863,852.26
Deductible loss 0.00 0.00 0.00 0.00
Allowance for intangible assets 0.00 0.00 0.00 0.00
132
2014 Annual Report of Anhui Gujing Distillery Company Limited
impairments
Accrued expenses 87,066,783.07 21,766,695.77 58,935,009.49 14,733,752.38
Changes in fair value of available - for -
0.00 0.00 1,124,306.00 281,076.50
sale financial assets
Salary deductible in next period 52,003,828.06 13,000,957.02 0.00 0.00
Total 252,975,253.58 63,243,753.50 173,487,587.33 43,371,896.87
6.16.2 Details of recognized deferred tax liabilities:
Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Category Taxable temporary Taxable temporary
Deferred tax liabilities Deferred tax liabilities
differences differences
Changes in fair value of tradable financial 121,035.00 30,258.75 0.00 0.00
asset
Changes in fair value of available - for - 22,226,138.76 5,556,534.69 0.00 0.00
sale financial assets
Total 22,347,173.76 5,586,793.44 0.00 0.00
6.16.3 Unrecognized deferred tax assets
Category Carrying amount as at 31/12/2014 Carrying amount as at 1/1/2014
Deductible temporary difference 2,295.30 2,043.30
Taxable temporary differences 1,179,384.41 724,118.08
Total 1,181,679.71 726,161.38
6.17 Notes payable
Type Carrying amount as at 31/12/2014 Carrying amount as at 1/1/2014
Bankers' acceptance 192,850,000.00 235,620,000.00
Trade acceptance 65,602,214.00 150,000.00
Total 258,452,214.00 235,770,000.00
6.18 Accounts payable
6.18.1 Detail for accounts payable
Item Carrying amount as at 31/12/2014 Carrying amount as at 1/1/2014
Within 1 year 311,334,691.25 433,467,588.20
133
2014 Annual Report of Anhui Gujing Distillery Company Limited
Over 1 year 93,299,505.33 9,467,811.24
Total 404,634,196.58 442,935,399.44
6.18.2 The details of significant accounts payable remaining unsettled for more than one year
Creditors Total amount Reason(s) for unsettlement
A company 7,615,752.27 Project not to completion final
B company 7,544,026.71 Project not to completion final
C company 6,925,618.44 Project not to completion final
D company 7,393,750.90 Project not to completion final
E company 6,376,632.93 Project not to completion final
Total 35,855,781.25
6.19 Advances from customers
6.19.1 General information
Item Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Payment for goods 377,503,471.86 147,257,393.88
Total 377,503,471.86 147,257,393.88
6.20 Employment benefits payable
6.20.1 Disclosure by classification
Carrying amount as at Increase during the current Decrease during the Carrying amount as at
Items
31/12/2013 year current year 31/12/2014
1. Short-term employee benefits 229,303,483.87 921,293,638.22 930,850,311.34 219,746,810.75
2. Post-employment benefits 2,039,718.30 54,556,663.07 56,144,670.84 451,710.53
3. Termination benefits 0.00 0.00 0.00 0.00
4. Other long-term employee benefits within
0.00 0.00 0.00 0.00
one year
Total 231,343,202.17 975,850,301.29 986,994,982.18 220,198,521.28
6.20.2 Disclosure by classification of short-term employee benefits
Carrying amount as at Current year Current year Carrying amount as at
Category
31/12/2013 increase decrease 31/12/2014
1. Wages, salaries and subsidies 194,316,386.96 797,776,749.85 814,978,571.46 177,114,565.35
134
2014 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount as at Current year Current year Carrying amount as at
Category
31/12/2013 increase decrease 31/12/2014
2. Employee welfare 0.00 30,036,643.21 30,036,643.21 0.00
3. Social insurance: 689,072.24 21,694,707.79 22,342,588.79 41,191.24
Including: Medical insurance 602,886.55 17,090,655.12 17,661,566.32 31,975.35
Employment injury insurance 53,045.78 2,759,223.24 2,807,849.02 4,420.00
Maternity insurance 33,139.91 1,844,829.43 1,873,173.45 4,795.89
4.Housing provident fund 11,882,473.50 52,209,742.15 51,864,028.81 12,228,186.84
5.Labour union fee and employee
22,415,551.17 19,575,795.22 11,628,479.07 30,362,867.32
education fee
Total 229,303,483.87 921,293,638.22 930,850,311.34 219,746,810.75
6.20.3 Disclosure by defined contribution plan
Carrying amount as at Increase during the Decrease during the Carrying amount as at
Items
31/12/2013 current year current year 31/12/2014
1. Basic pension 1,880,164.98 49,442,961.69 50,897,446.86 425,679.81
2. Unemployment insurance 159,553.32 5,113,701.38 5,247,223.98 26,030.72
Total 2,039,718.30 54,556,663.07 56,144,670.84 451,710.53
6.21 Taxes and fees payable
Tax (Fee) Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
VAT 103,775,137.73 86,131,273.54
consumption tax 67,865,349.26 155,018,644.03
Business tax 1,265,824.75 357,639.36
Enterprise income tax 267,763,285.42 330,262,070.25
Personal income tax 2,283,345.14 5,307,318.66
Urban construction and maintenance tax 6,287,946.00 7,354,158.61
Stamp duty 3,388,215.38 2,326,681.66
Education surcharge 6,277,797.04 7,342,500.00
Others 9,772,622.91 5,413,162.08
135
2014 Annual Report of Anhui Gujing Distillery Company Limited
Tax (Fee) Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Total 468,679,523.63 599,513,448.19
6.22 Other payables
Detail for other payable
Item Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Security deposit 272,037,012.38 234,789,824.70
Business trip borrowing 1,372,502.75 737,057.16
Guarantee money 38,824,726.91 34,027,305.78
Personal housing provident fund paid by
12,149,262.63 11,873,060.38
company
Other 44,484,959.07 33,214,736.99
Accrued expense 87,704,041.68 59,261,467.50
Total 456,572,505.42 373,903,452.51
6.23 Deferred income
Carrying amount as Increase during the Decrease during Carrying amount as
Items Reasons
at 31/12/2013 current year the current year at 31/12/2014
Receive government
Government grants 43,455,409.03 1,850,000.00 4,465,447.17 40,839,961.86
Grants concerning assets
Total 43,455,409.03 1,850,000.00 4,465,447.17 40,839,961.86
Involving government grants’ project:
Amount
Recognised Related to
Carrying amount recognised as Carrying amount
Items during current Other movement asset or
as at 31/12/2013 non-operating as at 31/12/2014
year income
income
Energy efficiency renovation
Related to
project for coal industrial 777,750.00 0.00 153,000.00 0.00 624,750.00
asset
boiler and glass furnace
Bozhou Logistics Center Related to
360,000.00 0.00 60,000.00 0.00 300,000.00
Project asset
136
2014 Annual Report of Anhui Gujing Distillery Company Limited
Amount
Recognised Related to
Carrying amount recognised as Carrying amount
Items during current Other movement asset or
as at 31/12/2013 non-operating as at 31/12/2014
year income
income
Special funds for finance
Related to
prevention and treatment 1,300,000.16 0.00 650,000.04 0.00 650,000.12
asset
sewage
Finance subsidy for energy Related to
2,592,451.00 0.00 531,623.52 0.00 2,060,827.48
saving projects asset
Finance subsidy for Related to
3,087,038.50 0.00 534,221.52 0.00 2,552,816.98
technical reconstruction asset
Within financial budget,
Related to
interest subsidy for deposit 83,333.37 0.00 39,999.96 0.00 43,333.41
asset
technical reconstruction
Within financial budget,
Related to
Enterprise development 202,500.00 0.00 30,000.00 0.00 172,500.00
asset
funds
IOT traceability system Related to
8,538,750.00 0.00 1,113,750.00 0.00 7,425,000.00
project asset
Related to
Rebate of land 26,513,586.00 0.00 1,199,727.17 0.00 25,313,858.83
asset
Electric machine
improvement for energy 0.00 1,100,000.00 137,499.96 0.00 962,500.04
saving project
Product quality online
0.00 750,000.00 15,625.00 0.00 734,375.00
monitor
Total 43,455,409.03 1,850,000.00 4,465,447.17 0.00 40,839,961.86
6.24 Share capital
Movements during the current reporting period (+、－)
Carrying amount Carrying amount as
Items
as at 31/12/2013 Share Bonus Conversion Total at 31/12/2014
Others Subtotal
issue issue from reserves amount
Total
503,600,000.00 0.00 0.00 0.00 0.00 0.00 0.00 503,600,000.00
share
6.25 Capital reserves
Amount as at Current year Current year
Item Amount as at 31/12/2014
31/12/2013 increase decrease
137
2014 Annual Report of Anhui Gujing Distillery Company Limited
Share premium 1,262,552,456.05 0.00 0.00 1,262,552,456.05
Other capital reserves 32,386,037.14 0.00 0.00 32,386,037.14
Total 1,294,938,493.19 0.00 0.00 1,294,938,493.19
6.26 Other comprehensive income
Total amount in current year
Less:
previously
Carrying recognized in After tax After tax Carrying
Items amount as at Amount for the other Less: Income attributable to attributable to amount as at
31/12/2013 year before tax comprehensive tax expense the parent minority 31/12/2014
income company shareholders
transferred into
profit or loss
1.Other
comprehensive
income will not
0.00 0.00 0.00 0.00 0.00 0.00 0.00
be reclassified
into income or
loss in the future
2.Other
comprehensive
income wil be
-843,229.50 22,226,138.76 -843,229.50 5,556,534.69 17,512,833.57 0.00 16,669,604.07
reclassified into
income or loss in
the future
Including: fair
value change of
-843,229.50 22,226,138.76 -843,229.50 5,556,534.69 17,512,833.57 0.00 16,669,604.07
financial asset
available for sale
Total of other
comprehensive -843,229.50 22,226,138.76 -843,229.50 5,556,534.69 17,512,833.57 0.00 16,669,604.07
income
6.27 Surplus reserves
138
2014 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount as at Increase Decrease
Items Carrying amount as at 31/12/2014
31/12/2013 during the current year during the current year
Statutory surplus
256,902,260.27 0.00 0.00 256,902,260.27
reserve
Total 256,902,260.27 0.00 0.00 256,902,260.27
Note: In accordance with the Company Lows and regulations in PRC, Our firm transferred 10% of a to a statutory surplus reserve until
accumulated amount of such reserve balance reaches 50% of the Company’s registered capital.
After the company draws the statutory surplus reserve, it may, upon a resolution made by the shareholders' meeting or the shareholders’
assembly, draw a discretionary surplus reserve from the after-tax profits. Discretionary surplus reserve as approved by the shareholders in our
shareholders' meeting can be used to make good previous years’ losses or to increase the capital.
6.28 Retained earning
Items Current year Prior year
Pre-adjustment balance brought forward 1,688,158,733.09 1,356,119,112.84
Total adjustment to retained earnings b/f (+, -) 0.00 0.00
Retained earnings b/f after adjustment 1,688,158,733.09 1,356,119,112.84
Add: Net profit attributable to shareholders of the parent 597,041,887.34 622,004,915.79
Less: Appropriation to statutory surplus reserve 0.00 38,165,295.54
Appropriation to discretionary surplus reserve 0.00 0.00
General reserve 0.00 0.00
Ordinary dividends declared 176,260,000.00 251,800,000.00
Ordinary dividends transformed into capital share 0.00 0.00
Balance carrying forward 2,108,940,620.43 1,688,158,733.09
6.29 Operating revenues and costs
Current year Prior year
Items
Operating revenues Operating costs Operating revenues Operating costs
Principal operating income 4,612,235,437.15 1,426,359,089.71 4,540,933,231.07 1,348,373,880.54
Other operating income 38,620,444.57 32,713,823.53 39,642,423.64 35,763,210.54
Total 4,650,855,881.72 1,459,072,913.24 4,580,575,654.71 1,384,137,091.08
139
2014 Annual Report of Anhui Gujing Distillery Company Limited
6.30 Business tax and surcharges
Items Current year Prior year
Consumption tax 554,437,281.01 520,704,303.63
Business tax 4,268,096.77 5,603,326.91
Urban maintenance and construction tax,
107,437,775.94 104,863,553.22
Education surcharge
Other 769,835.00 0.00
Total 666,912,988.72 631,171,183.76
Note: The provision standards for taxes and surcharges refer to Note 5 Taxation.
6.31 Sales expenses
Items Current year Prior year
Employment benefits 102,455,485.58 115,970,094.07
Travel 58,761,813.78 61,232,591.69
Advertisement 439,671,581.42 470,563,008.53
Transportation charges 24,060,769.19 22,706,743.01
Sales promotion costs 289,923,860.69 245,177,852.07
Sample wine 105,417,088.10 103,000,160.58
Service fee 255,026,142.27 251,778,479.07
Other sales expenses 28,889,295.03 9,121,648.00
Total 1,304,206,036.06 1,279,550,577.02
6.32 General and administrative expenses
Item Current year Prior year
Employment benefits 314,434,120.98 318,513,551.08
Office 41,139,729.33 38,272,593.59
Taxes and surcharges 32,504,277.38 13,705,921.98
Maintenance expenses 24,260,572.70 12,187,698.65
Depreciation 29,083,486.30 17,238,672.59
Amortization of intangible assets 8,996,822.71 8,369,306.24
140
2014 Annual Report of Anhui Gujing Distillery Company Limited
Item Current year Prior year
Pollution discharge 15,713,644.29 10,627,786.12
Spillage of material 56,062,592.97 40,506,124.98
Travel expenses 3,865,395.06 4,719,007.39
Water and electricity charges 8,600,696.17 6,029,524.90
Others 44,763,355.67 40,015,709.81
Total 579,424,693.56 510,185,897.33
6.33 Financial costs
Item Current year Prior year
Interest expenses 0.00 0.00
Less: Interest income 38,165,430.61 46,871,321.29
Less: Capitalised interest 0.00 0.00
Exchange gain or loss 0.00 -361,052.85
Less: Capitalised exchange gain or loss 0.00 0.00
Others 413,820.25 220,397.08
Total -37,751,610.36 -47,011,977.06
6.34 Impairment loss on assets
Item Current year Prior year
Allowance for bad debt -20,962.68 -147,168.52
Allowance for inventory impairment 8,017,738.58 8,184,366.61
Allowance for intangible assets impairment 694,018.11 0.00
Total 8,690,794.01 8,037,198.09
6.35 Gain from changes in fair value
Source of fair value change Current year Prior year
Financial assets measured by fair value with changes in fair value recognised in
121,035.00 0.00
profit or loss
Including: Derivative financial assets 0.00 0.00
Total 121,035.00 0.00
141
2014 Annual Report of Anhui Gujing Distillery Company Limited
6.36 Investment income
Items Current year Prior year
Invest income from holding the financial asset of which fair value recognized in profit
0.00 0.00
or loss
Investment income from disposal of financial assets measured by fair value with
1,254,456.02 0.00
changes in fair value recognised in profit or loss
Investment income from holding the financial asset available for sale 88,030,527.27 10,050,415.19
Investment income from disposal of financial assets available for sale 15,857,617.98 0.00
Total 105,142,601.27 10,050,415.19
6.37 Non-operating income
Recognized into
current year
Item Current year Prior year non-recurring profit
and loss
Gain on non-current asset disposals 625,342.92 734,264.74 625,342.92
Including : Gain on fixed asset disposals 625,342.92 734,264.74 625,342.92
Government grants (See details of government grants) 6,045,394.97 6,438,091.17 6,045,394.97
Income from penalties 10,695,244.40 15,744,684.78 10,695,244.40
Sales of wastes 7,025,600.00 5,734,379.04 7,025,600.00
Accounts payable no need to pay back 88,951.50 3,510.03 88,951.50
Others 4,085,522.35 2,942,912.99 4,085,522.35
Total 28,566,056.14 31,597,842.75 28,566,056.14
Details of government grant:
Government assistance Current year Prior year Related to assets or income
Subsidy revenue 1,579,947.80 3,946,591.06 Related to income
Amortization of government grant related to
4,465,447.17 2,491,500.11 Related to asset
assets
Total 6,045,394.97 6,438,091.17
6.38 Non-operating expenses
142
2014 Annual Report of Anhui Gujing Distillery Company Limited
Recognized in current year
Category Current year Prior year
non-recurring profit and loss
Loss on non-current asset disposals 2,759,691.62 2,120,610.71 2,759,691.62
Within: Loss on fixed asset disposals 2,759,691.62 2,120,610.71 2,759,691.62
Abandonment loss 0.00 8,645.01 0.00
Compensations paid 0.00 1,882,810.00 0.00
Others 5,165,560.14 230,687.31 5,165,560.14
Total 7,925,251.76 4,242,753.03 7,925,251.76
6.39 Income tax expenses
Category Current year Prior year
Current tax calculated in accordance with relevant tax law 219,285,294.18 253,905,856.93
Deferred tax -20,122,674.38 -23,999,583.32
Total 199,162,619.80 229,906,273.61
6.40 Other comprehensive income
Please see Note 6.26 for detail.
6.41 Notes to the statement of cash flows
6.41.1 Other cash received relating to operating activities
Category Current year Prior year
Guarantee deposit 37,008,070.73 16,780,231.00
Government grants 1,579,947.80 3,946,591.06
Interest income 29,206,434.58 54,125,179.63
Other 28,666,651.09 24,421,976.81
Withdrawn pledged deposit 75,000,000.00 200,000,000.00
Total 171,461,104.20 299,273,978.50
6.41.2 Other cash payments relating to operating activities
Category Current year Prior year
Cash paid in sales expenses and general and administrative expense 914,009,770.42 883,634,258.37
The fixed deposit pledged for Notes payable 36,100,000.00 75,000,000.00
143
2014 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
Others 5,579,380.40 2,333,894.39
Total 955,689,150.82 960,968,152.76
6.41.3 Other cash received relating to investing activities
Category Current year Prior year
Government grants related to assets 1,850,000.00 35,423,586.00
Total 1,850,000.00 35,423,586.00
6.42 Supplementary information to the statement of cash flows
6.42.1 Reconciliation of cash flows from operating activities to net profit
Category Current year Prior year
① Reconciliation of cash flows from operating activities to net profit:
Net profit 597,041,887.34 622,004,915.79
Add: Loss on asset impairment 3,733,850.18 4,704,784.16
Depreciation of fixed assets, oil and gas assets, biological assets held for
130,655,842.48 85,018,563.38
production
Amortisation of Investment properties 3,113,723.42 2,776,409.10
Amortisation of intangible assets 8,996,822.71 8,369,306.24
Amortisation of Long-term deferred expenditure 28,275,251.66 11,850,269.75
Loss on non-current assets disposal (gain presented by "-" prefix) 2,134,348.70 1,386,345.97
Loss on scrap of fixed assets (gain presented by "-" prefix) 0.00 8,645.01
Loss on fair value changes (gain presented by "-" prefix) -121,035.00 0.00
Financial costs (gain presented by "-" prefix) -4,684,329.37 0.00
Investment loss (gain presented by "-" prefix) -105,142,601.27 -10,050,415.19
Decrease of deferred tax assets (increase presented by "-" prefix) -20,152,933.13 -24,280,659.82
Increase of deferred tax liabilities (increase presented by "-" prefix) 30,258.75 -697,845.96
Decrease of inventories (increase presented by "-" prefix) -155,210,431.54 -298,007,912.34
Decrease of operating receivables (increase presented by "-" prefix) -259,515,795.42 21,439,577.42
Increase of operating payables (decrease presented by "-" prefix) 162,804,877.55 216,224,871.91
144
2014 Annual Report of Anhui Gujing Distillery Company Limited
Category Current year Prior year
Amortization of deferred income -4,465,447.17 -2,491,500.11
Net cash flows generated from operating activities 387,494,289.89 638,255,355.31
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 31/12/2014 682,360,442.79 1,306,930,710.96
Less: Cash as at 1/1/2014 1,306,930,710.96 2,409,650,352.09
Add: Cash equivalents as at 31/12/2014 0.00 0.00
Less: Cash equivalents as at 1/1/2014 0.00 0.00
Net increase of cash and cash equivalents -624,570,268.17 -1,102,719,641.13
6.42.2 Composition of cash and cash equivalents
Category Current year Prior year
① Cash 682,360,442.79 1,306,930,710.96
Including: Cash at hand 349,833.07 251,743.25
Demand bank deposit 677,644,608.33 1,306,636,737.50
Demand other monetary funds 4,366,001.39 42,230.21
② Cash equivalents 0.00 0.00
Including: Debt instrument matured within three months 0.00 0.00
③ Cash and cash equivalents as at 31/12/2014 682,360,442.79 1,306,930,710.96
6.43. Asses of which using rights are limited
Items Balance at 31/12/2014 Reasons for limited
Monetary funds 36,100,000.00 Deposit as assurance to get bank acceptance
145
2014 Annual Report of Anhui Gujing Distillery Company Limited
Items Balance at 31/12/2014 Reasons for limited
Notes receivable 87,250,000.00 Deposit as assurance to get bank acceptance
合计 123,350,000.00
Note 7: Changes of scope of consolidation financial statements
7.1 Other reasons that cause the scope change
The company has newly set up the son company Anhui colorful taste wine Co., Ltd
The company has logged out the grandson company Shanghai Hong bang Culture Communication Co., Ltd
Note 8: The equity in other main entities
8.1 The equity in subsidiaries
8.1.1 The construction of the group
Place of Place Nature Holding proportion %
Subsidiaries Acquired method
operation of registration of business Directly Indirectly
Bozhou Gujing Sales Co., Ltd. Bozhou, Anhui Bozhou, Anhui
Commercial trade 100.00 Set up
(hereafter Gujing Sales)
province province
Bozhou Gujing Transportation Co., Ltd Bozhou, Anhui Bozhou, Anhui
Motor transpor 99.00 1.00 Set up
(hereafter Gujing Transportation) province province
Bozhou Gujing Glass Co., Ltd Bozhou, Anhui Bozhou, Anhui
Manufacture 99.00 1.00 Set up
(hereafter Gujing Glass) province province
Bozhou Gujing Waste Reclamation Bozhou, Anhui Bozhou, Anhui
Co., Ltd province province Waste recycle 100.00 Set up
(hereafter Gujing Waste)
Anhui Jinyunlai Culture & Media Bozhou, Anhui Bozhou, Anhui
Advertisement
province province 100.00 Set up
Co.,Ltd. (hereafter Jinyunlai)
marketing
Bozhou Gujing Packaging Co., Ltd. Bozhou, Anhui Bozhou, Anhui
Manufacture 100.00 Set up
(hereafter Gujing Packaging) province province
Bozhou, Anhui Bozhou, Anhui
Technical
Anhui Ruisiweier Technology Co., Ltd province province 100.00 Set up
research
Bozhou, Anhui Bozhou, Anhui
Anhui colorful taste wine co., LTD Manufacture 100.00 Set up
province province
Shanghai Shanghai
Shanghai gujing jinhao hotel Bussiness Combinations
Hotel manage 100.00
management company Under the Same control
146
2014 Annual Report of Anhui Gujing Distillery Company Limited
Place of Place Nature Holding proportion %
Subsidiaries Acquired method
operation of registration of business Directly Indirectly
Bozhou, Anhui Bozhou, Anhui Bussiness Combinations
Bozhou gujing hotel Co.Ltd Hotel operating 100.00
province province Under the Same control
Note 9: The risk associated with financial instruments
The main financial instruments of the Company including equity investments, financial products, trust investment, accounts receivable, accounts
payable and etc., please see Note 6 for detail of related items. The risk associated with financial instruments, and risk management policies which
the company use to reduce these risks as described below. The management of the Company manages and supervises the risks to ensure that the
risks can be controlled within a limited range.
9.1 The targets and policies of risks management
The target of risks management is to obtain the proper balance between the risks and benefits, to reduce the negative impact that caused by the
risk of the Company to the lowest level, and to maximize the benefits of shareholders and other equity investors. Based on the targets of risk
management, the basic strategy of the Company’s risk management is to identify and analyze the risks which are faced by the Company, establish
suitable risk tolerance baseline and proceed the risk management, and supervise a variety of risks timely and reliably, and control the risk within a
limited range.
9.1.1 Market Risk
(1) Foreign exchange risk
Foreign exchange risk refers to the risk of loss due to exchange rate fluctuations generally. The main business of the company is in the main
land and trading with RMB, the market risk is very small
(2) Interest rate risk - the risk of changes in cash flow
The fund of the company is enough, the company has no load, so the risk is very small
(3) Other price risk
The financial asset available for sale and financial asset for trading of the company are measured by fair value. So the company bear the risk of
the change of security market. To decrease the risk, the company hold several combination of equity and security.
9.1.2. Credit Risk
That could cause the Company’s maximum credit risk of financial losses mainly from the losses of financial assets, which are resulted by the
other party of contract fails to fulfill the obligations, as at 31 December 2014. The detail is listed below:
The carrying value that are recognized in the consolidated financial statement. For the financial instrument measured by fair value, the highest
risk is the value will change with the future fair value.
The company only trade with the other company with high credit record. According to the rule of the company, the client need to pay first then
receive the goods. Only few are traded with credit.
The current asset of the company is deposited in the bank with the highest credit record. So the credit risk of the current asset is low
147
2014 Annual Report of Anhui Gujing Distillery Company Limited
9.1.3 Liquidity risk
When managing liquidity risk, the Company’s management believes that maintaining adequate cash and cash equivalents, and monitoring that
at same time, in order to meet the needs of operation of the Company, and to reduce the impact of fluctuations in cash flows. The management of
the Company monitors the use of bank borrowings and ensures to abide by loan agreements.
Note 10: Disclosure of the fair value
10.1 The fair value at the end of current year of assets and liabilities which are measured by fair value
The fair value at the end of current year
The second level The third level
Items The first level measured
measured by fair measured by fair Total
by fair value
value value
1. Continuous measurement by fair value
1.1 The financial assets are measured by fair
value and the changes are recognized into 303,919.60 303,919.60
current profit or loss
1.1.1 Trading financial assets 303,919.60 303,919.60
Equity instruments investment 303,919.60 303,919.60
1.2 Financial asset available for sale 65,332,932.00 65,332,932.00
Equity instruments investment 65,332,932.00 65,332,932.00
Total amount of liabilities continuous
65,636,851.60 65,636,851.60
measurement by fair value
10.2 Determined on the basis of continuous first level for fair value measurement of the market of project
Based on the identical assets or liabilities acquired on unadjusted quoted in an active market at balance sheet day.
Note 11: Related parties and related party transaction
11.1 Details of the parent
Registered Shareholding Voting right
Parents Relationship Nature of business
capital t in the Company % in the Company %
Drink, building materials,
Controlling
Gujing Group manufacture plastic 353,380,000.00 53.88 53.88
shareholders
products
Note: The final controller is the government of Bozhou, Anhui province.
11.2 Subsidiaries
See Note 8.1 ―The equity in subsidiaries‖.
148
2014 Annual Report of Anhui Gujing Distillery Company Limited
11.3 Details of other related parties
Other related parties Relationship
Anhui Ruifuxiang Food Co., Ltd Affiliate of the actual controller and controlling shareholder
Anhui Ruijing catering management Co., Ltd Affiliate of the actual controller and controlling shareholder
Anhui Ruijing Business Travel (Group) Co., Ltd Affiliate of the actual controller and controlling shareholder
Bozhou Guesthouse Co., Ltd. Affiliate of the actual controller and controlling shareholder
Anhui Gujing Real Estate Group Co., Ltd. Affiliate of the actual controller and controlling shareholder
Orient Ruijing Enterprise Investment Development Co., Ltd. Affiliate of the actual controller and controlling shareholder
Anhui Hengxin Pawn Co., Ltd. Affiliate of the actual controller and controlling shareholder
Bozhou Ruineng Thermal Power Co., Ltd. Affiliate of the actual controller and controlling shareholder
Hefei Gujing Holiday Hotel Co., Ltd Affiliate of the actual controller and controlling shareholder
BozhouRuifuixiang high protein feed Co. Ltd Affiliate of the actual controller and controlling shareholder
Anhui Gujing restaurant management Co., Ltd Affiliate of the actual controller and controlling shareholder
Anhui Ruixin pawn Co. Ltd Affiliate of the actual controller and controlling shareholder
Anhui Zongxin finance lease Co. Ltd Affiliate of the actual controller and controlling shareholder
Anhui Huixin finance invest group Co.Ltd Affiliate of the actual controller and controlling shareholder
Bozhou Anxin Micro Finance Co., Ltd Affiliate of the actual controller and controlling shareholder
Bozhou Gujing Hotel Co., Ltd. Affiliate of the actual controller and controlling shareholder
11.4 Transactions with related parties
11.4.1 Transactions through purchase or sell goods and accept or supply services
(1) The situation of purchases goods or accepts services
Total amount during current Total amount during prior
Related parties Content of transaction
year year
Anhui Ruifuxiang Food Co., Ltd Procurement of goods 5,228,142.02 5,570,610.49
Bozhou Guesthouse Co., Ltd. Accept service 824,672.70 965,127.00
Anhui Ruijing Catering management Co., Ltd Procurement of goods 894,456.00 726,084.00
Anhui Ruijing Catering management Co., Ltd Accept restaurant service 22,945.00 0.00
Hefei Gujing Holiday Hotel Co., Ltd Procurement of goods 3,864,897.72 2,522,565.71
Accept restaurant and hotel
Hefei Gujing Holiday Hotel Co., Ltd
174,385.19 0.00
service
Total 11,009,498.63 9,784,387.20
(2) The situation of sells goods or rendering services
149
2014 Annual Report of Anhui Gujing Distillery Company Limited
Total amount during current Total amount during prior
Related parties Content of transaction
year year
Gujing Group Sales of mini materials 26,844.05 87,932.56
Gujing Group Provide catering services 200,741.00 63,206.00
Gujing Group Sales of distilled spirit 0.00 141,509.43
Anhui Ruifuxiang Food Co., Ltd Sales of distilled spirit 129,538.46 228,153.84
Bozhou Guesthouse Co., Ltd. Sales of distilled spirit 189,538.45 23,076.92
Bozhou Guesthouse Co., Ltd. Sales of mini materialss 520.17 27,076.92
Bozhou Gujing Hotel Co., Ltd. Sales of distilled spirit 615.38 287,230.78
Anhui Gujing Real Estate Group Co., Ltd. Sales of distilled spirit 79,384.61 48,923.07
Anhui Ruijing catering Co., Ltd. Sales of distilled spirit 39,538.46 28,461.54
Anhui Ruijing catering Co., Ltd. Provide advertising service 0.00 4,716.98
Orient Ruijing Enterprise Investment Development Provide catering services 0.00 153,057.27
Bozhou Ruineng Thermal Power Co., Ltd. Sales of distilled spirit 56,692.31 84,692.31
Anhui Hengxin Pawn Co., Ltd. Sales of distilled spirit 2,538.47 13,846.14
Bozhou Anxin Micro fiannce Co., Ltd Sales of distilled spirit 3,461.54 5,384.61
Anhui Ruijing Business Travel (Group) Co., Ltd Sales of distilled spirit 1,538.46 18,384.62
Hefei Gujing Holiday Hotel Co., Ltd Sales of mini materials 0.00 12,307.69
Hefei Gujing Holiday Hotel Co., Ltd Sales of distilled spirit 1,411,692.31 38,461.54
Bozhou Ruifuciang high protein feed Co., Ltd Sales of distilled spirit 0.00 17,958.63
Bozhou Ruifuciang high protein feed Co., Ltd Sales of distilled spirit 11,692.30 18,923.09
Anhui Gujing restaurant management Co., Ltd Sales of distilled spirit 121,307.69 0.00
Anhui Zongxin finance lease Co. Ltd Sales of distilled spirit 1,538.46 0.00
Anhui Ruixin Pawn Co. Ltd Sales of distilled spirit 923.08 0.00
Anhui Huixin finance invest group Co.Ltd Sales of distilled spirit 2,000.00 0.00
Anhui Ruifuxiang food Co. Ltd Restaurant service 6,150.00 0.00
Bozhou Ruifuxiang high protein feed Co. Ltd Sales of materials 80,984.62 0.00
Total 2,367,239.82 1,303,303.94
11.4.2 Lease between related parties
(1) The Company is as the leasor
150
2014 Annual Report of Anhui Gujing Distillery Company Limited
Lease rental recognized in Lease rental recognized in
Leasee classification
current year prior year
Gujing Group Buildings and constructions 1,800,000.00 1,800,000.00
Gujing Group Buildings and constructions 500,000.00 500,000.00
11.5 The balance of payables and receivables among related parties
11.5.1 Receivables owed by related parties
There has no receivables owed by related parties during current year.
11.5.2 Payables owed to related parties
Related party Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Receivable in advance:
Anhui Ruijin catering management Co. Ltd 108,000.00 0.00
Total 108,000.00 0.00
Other payable:
Anhui Ruijing Business Travel (Group) Co., Ltd 0.00 77,997.24
Anhui Ruifuxiang Food Co., Ltd 2,000.00 102,000.00
Total 2,000.00 179,997.24
Note 12: Commitments and contingencies
12.1 Important commitments
Irrevocable lease contracts under performance and their financial effects as at the end of current year.
Items Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
The minimum lease payments of irrevocable operating lease
contracts:
1st year after the balance sheet date 2,300,000.00 2,300,000.00
2nd year after the balance sheet date 2,300,000.00 2,300,000.00
3rd year after the balance sheet date 2,300,000.00 2,300,000.00
Subsequent years 28,558,333.33 30,858,333.33
Total 35,458,333.33 37,758,333.33
12.2 Contingencies
151
2014 Annual Report of Anhui Gujing Distillery Company Limited
There has no contingencies till the end of current year
.
Note 13: Post reporting date events
13.1 Distribution of profits
On 27 March 2015, the Company held fifth meeting of board of directors which approved profit distribution plan for the year of 2014. The
company plan to use the total share of 503,600,000 of the company at 31/12/2014 as a base, to distribute 2 RMB (Containing tax) every 10 shares,
and as result to distribute RMB 100,720,000 to the whole shareholder. The profit distribution plan is pending resolution by the shareholders’
meeting.
Note 14: Notes to the main elements of the separate financial statement of the Company
14.1 Accounts receivable
14.1.1 Disclosure by classification
Balance as at 31/12/2014
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Accounts receivable of individual significance subject
0.00 0.00 0.00 0.00 0.00
to individually assessment for impairment
Accounts receivable portfolio subject to impairment by
2,199,491.74 100.00 590,662.10 26.85 1,608,829.64
credit risk
Accounts receivable of individually insignificance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Total 2,199,491.74 100.00 590,662.10 26.85 1,608,829.64
(Continued)
Balance as at 31/12/2013
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Accounts receivable of individual significance subject
0.00 0.00 0.00 0.00 0.00
to individually assessment for impairment
Accounts receivable portfolio subject to impairment by
1,885,313.13 100.00 587,771.00 31.18 1,297,542.13
credit risk
Accounts receivable of individually insignificance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
152
2014 Annual Report of Anhui Gujing Distillery Company Limited
Balance as at 31/12/2013
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Total 1,885,313.13 100.00 587,771.00 31.18 1,297,542.13
(1) Accounts receivable using the age analysis method for measurement of allowance for bad debt
Balance as at 31/12/2014
Age
Carrying amount Allowance for bad debt % of total
Within 1 year
Include：within 6 months 289,110.27 2,891.10 1.00
7-12 months 0.00 0.00 0.00
Subtotal within 1 year 289,110.27 2,891.10 1.00
1 to 2 year 0.00 0.00 0.00
2 to 3 year 0.00 0.00 0.00
Over 3 years 587,771.00 587,771.00 100.00
Total 876,881.27 590,662.10 67.36
(2) Accounts receivable using the related party method for measurement of allowance for bad debt
Balance as at 31/12/2014
Related parties
Carrying amount Allowance for bad debt % of total
Related parties 1,322,610.47 0.00 0.00
Total 1,322,610.47 0.00 0.00
14.1.2 Recognization, recovery and reversal of allowance for bad debt
Recognition of the allowance is RMB 2,891.10.
14.1.3 Accounts receivable written off during the current year
There is no accounts receivable written off during the current year
14.1.4 Details of top five accounts receivable
The total amount of top five accounts receivables which are summaried by the balance as at the end of current year is CNY2,199,491.74,
accounting for the proportion of the total accounts receivable balance as at the end of current year is 100%, the total amount of corresponding
allowence for bad debts is CNY590,662.10.
14.2 Other receivable
153
2014 Annual Report of Anhui Gujing Distillery Company Limited
14.2.1 Disclosure by classification
Balanceasat31/21/2014
Items Carrying amount Allowance for bad debt
Book value
Amount %of total Amount %of total
Other receivable of individual significance subject to
50,727,440.55 28.86 50,727,440.55 100.00 0.00
individually assessment for impairment
Other receivable portfolio subject to impairment by
125,054,444.71 71.14 228,135.16 0.18 124,826,309.55
credit risk
Other receivable of individually insignificance subject
0.00 0.00 0.00 0.00 0.00
to individually assessment for impairment
Total 175,781,885.26 100.00 50,955,575.71 28.99 124,826,309.55
(Continued)
Balance as at 31/21/2013
Items Carrying amount Allowance for bad debt
Book value
Amount % of total Amount % of total
Other receivable of individual significance subject
51,109,940.55 26.78 51,109,940.55 100.00 0.00
to individually assessment for impairment
Other receivable portfolio subject to impairment by
139,756,918.36 73.22 102,354.83 0.07 139,654,563.53
credit risk
Other receivable of individually insignificance
0.00 0.00 0.00 0.00 0.00
subject to individually assessment for impairment
Total 190,866,858.91 100.00 51,212,295.38 26.83 139,654,563.53
(1)Other receivable of individual significance subject to individually assessment for impairment
Balance at 31/12/2014
Other receivable
Other receivable Allowance % of total Reasons
Jiaoqiao securities 11,840,500.00 11,840,500.00 100.00 Company went through bankrupt
Hengxin securities 29,502,438.53 29,502,438.53 100.00 Company went through bankrupt
Minfa securities 9,384,502.02 9,384,502.02 100.00 Company went through bankrupt
Total 50,727,440.55 50,727,440.55 — —
(2) Other receivables using the age analysis method for measurement of allowance for bad debt
154
2014 Annual Report of Anhui Gujing Distillery Company Limited
Balance as at 31/12/2014
Age
Carrying amount Allowance for bad debt % of total
Within 1 year
Include：within 6 months 2,645,700.38 26,457.00 1.00
7 to 12 months 284,050.33 14,202.52 5.00
Subtotal within one year 2,929,750.71 40,659.52 1.39
1 to 2 years 710,865.81 71,086.58 10.00
2 to 3 years 182,964.20 91,482.10 50.00
Over 3 years 24,906.96 24,906.96 100.00
Total 3,848,487.68 228,135.16 5.93
(3) Accounts receivable using the related party method for measurement of allowance for bad debt
Balance as at 31/12/2014
Related parties
Carrying amount Allowance for bad debt % of total
Related parties 121,205,957.03 0.00 0.00
Total 121,205,957.03 0.00 0.00
14.2.2 Recognition, recovery and reversal of allowance for bad debt
Recognition of allowance for bad debts is CNY 125.780.33 during current year. Recovery amount during current year is CNY382,500.00.
Include: The important recognition, recovery and reversal of allowance for bad debt
Name recovery and reversal of allowance for bad debt Method
Jianqiao Securities 382,500.00 The property distribution of the bankrupt
Total 382,500.00
14.2.3 Accounts receivable written off during the current year
There has no accounts receivable written off during the current year
14.2.4 Classification of other receivable
Nature Balance at 31/12/2014 Balance at 31/12/2013
Related parties 121,205,957.03 136,303,423.36
Invest in securities 50,727,440.55 51,109,940.55
Deposit and Assurant 1,670,464.25 1,502,757.40
155
2014 Annual Report of Anhui Gujing Distillery Company Limited
Business trip borrowing 284,256.89 498,472.50
Rent, water and gas 903,964.37 400,752.34
Other 989,802.17 1,051,512.76
Total 175,781,885.26 190,866,858.91
14.2.5 Details of top five other receivable:
Allowance
Balance at the year
Debtor nature age % of total amount balance at the
end
year end
The first Related parties 120,695,000.00 1 to 5 years 68.66 0.00
The second Invest in securities 29,502,438.53 Over 3 years 16.78 29,502,438.53
The third Invest in securities 11,840,500.00 Over 3 years 6.74 11,840,500.00
The forth Invest in securities 9,384,502.02 Over 3 years 5.34 9,384,502.02
The fifth Deposit 689,658.09 Within 6 months 0.39 6,896.58
Total — 172,112,098.64 — 97.91 50,734,337.13
14.3 Long-term equity investments
14.3.1 Disclosure by classification
Carrying amount as at 31/12/2014 Carrying amount as at 31/12/2013
Items allowance for Net carrying allowance for Net carrying
Carrying amount Carrying amount
bad debts amount bad debts amount
Invest to
338,089,408.32 338,089,408.32 308,089,408.32 308,089,408.32
subsidiaries
Total 338,089,408.32 338,089,408.32 308,089,408.32 308,089,408.32
14.3.2 Details of long-term equity investments
Carrying amount of
Carrying amount Increase during Decrease during Carrying amount as Impairment
Items impairment allowance
as at 31/12/2013 current year current year at 31/12/2014 allowance
as at 31/12/2014
Gujing Sales 84,864,497.89 0.00 0.00 84,864,497.89 0.00 0.00
Gujing Glass 85,793,666.00 0.00 0.00 85,793,666.00 0.00 0.00
Shanghai
49,906,854.63 0.00 0.00 49,906,854.63 0.00 0.00
Gujing Jinhao
156
2014 Annual Report of Anhui Gujing Distillery Company Limited
Carrying amount of
Carrying amount Increase during Decrease during Carrying amount as Impairment
Items impairment allowance
as at 31/12/2013 current year current year at 31/12/2014 allowance
as at 31/12/2014
Gujing Hotel 648,646.80 0.00 0.00 648,646.80 0.00 0.00
Gujing
6,875,743.00 0.00 0.00 6,875,743.00 0.00 0.00
Transportation
Gujing
30,000,000.00 0.00 0.00 30,000,000.00 0.00 0.00
Packaging
Anhui
50,000,000.00 0.00 0.00 50,000,000.00 0.00 0.00
Ruisiweier
Anhui colorful
0.00 30,000,000.00 0.00 30,000,000.00 0.00 0.00
taste Co.Ltd
Total 308,089,408.32 30,000,000.00 0.00 338,089,408.32 0.00 0.00
14.4 Operating revenues and costs
Current year Prior year
Items
Revenue Costs Revenue Costs
Revenue from principal operating activities 2,594,480,546.56 1,443,435,704.23 2,480,700,170.78 1,362,763,770.06
Revenue from other operating activities 45,971,933.26 32,577,273.81 48,849,683.23 35,573,988.46
Total operating revenue 2,640,452,479.82 1,476,012,978.04 2,529,549,854.01 1,398,337,758.52
14.5 Investment income
Items Current year Prior year
Invest income from long term equity investment using cost mothed 467,513,453.43 590,896,184.37
Investment income from disposal of financial assets measured by fair value with
1,104,622.26 0.00
changes in fair value recognised in profit or loss
Investment income from holding the financial asset available for sale 87,642,900.83 10,050,415.19
Investment income from disposal of financial assets available for sale 15,857,617.98 0.00
Total 572,118,594.50 600,946,599.56
Note 15: Supplementary information
15.1 Extraordinary gains or losses for current year
157
2014 Annual Report of Anhui Gujing Distillery Company Limited
Supplemental information Total amount Explanation
Gains or losses arising from disposal of non-current assets -2,134,348.70
Tax repayments or waiving of taxes not officially authorized or not with proper authorization
Government grants accounted for through profit or loss for the current reporting period (excl. grants
6,045,394.97
directly associated with the Company’s operations and subject to national quotas)
Cost of monetary funds charged on non-financial institutions accounted for through profit or loss for the
current reporting period
Gains from the investment costs paid less than the acquirer’s interest in the fair value of the bargainor’s
identifiable net assets( During acquire subsidiary、joint venture and associates)
Gains or losses arising from non-monetary assets exchange
Gains or losses arising from entrusted assets and investments
Impairment allowances arising from force majeure, such as natural disasters
Gain or loss arising from debt restructuring
Restructuring expenses, such as employee settlement and relocation costs and costs of integration
Gains or losses arising from transactions of which the prices are deemed unfair (the difference between
the price and the fair value)
Net profit or loss of subsidiaries acquired through business combination under common control from the
beginning of the current reporting period to the combination dates.
Gains or losses arising from contingent events not associated with the Company’s operating activities
Gains or losses arising from changes in the fair values of financial instruments held for trading (excl.
effective hedging instruments associated with the Company’s operating activities) or disposal of financial
17,233,109.00
instruments held for trading and available-for-sale financial assets (excl. effective hedging instruments
associated with the Company’s operating activities)
Recovery of impairment allowance for receivables subject to individual assessment for impairment 382,500.00
Gains or losses arising from entrusted borrowings
Gains or losses arising from changes in the fair values of investment property measured at fair value
Impact of one-off adjustment required by tax laws, accounting standards and relevant regulations on the
profit or loss for the current reporting period
Revenue arising from entrusted operation
Other non-operating revenue and non-operating expenses not listed above 16,729,758.11
Other gains or losses satisfying the definition of extraordinary gains or losses
158
2014 Annual Report of Anhui Gujing Distillery Company Limited
Supplemental information Total amount Explanation
Subtotal 38,256,413.38
Less: Effect of corporate income tax 9,568,067.12
Less: Net amount attributable to minority interests (after tax) 0.00
Total 28,688,346.26
Note: Extraordinary gains or losses event use ―+‖express revenue and income, ―-‖ express loss and expenditure.
The Company recognized 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 (ZhengjianhuiGonggao [2008] No.43).
15.2 Yield Rate of Net Assets and Earnings Per Share
Weighted average yield rate Earnings Per Share(Yuan per share)
Profits for the reporting period
of net assets% Basic EPS Diluted EPS
Net profits attributable to ordinary shareholders 15.05 1.19 1.19
Net profits attributable to ordinary shareholders
14.32 1.13 1.13
(excl. extraordinary gains or losses)
159
2014 Annual Report of Anhui Gujing Distillery Company Limited
Secction 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.
160
