2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
Annual Report 2021
April 2022
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section I Important Notice, Table of Contents and Paraphrase
The Board of Directors, Board of Supervisors, all directors, supervisors and
Senior Management Personnel of the Company hereby guarantee that the
contents are authentic, accurate and complete, and there are no false records,
misleading representations or material omissions in the Annual Report, and
shall take all the joint and several legal responsibilities.
Dong Mingzhu, the Company's responsible person, Liao Jianxiong,
responsible person in charge of accounting work and Liu Yanzi, in-charge
person of accounting institution (accounting superintendent) hereby declare and
warrant that the financial report in the Report is authentic, accurate and
complete.
All the directors attended the meeting of the Board of Directors in respect
of deliberation of the Report.
The forward-looking statements such as future plans and development
strategies in the Report do not constitute a substantive commitment of the
Company to investors. Investors and relevant persons should therefore be aware
of risk factors attendant in investment and understand the differences between
plans, forecasts and commitments.
The Company's profit distribution proposal passed upon deliberation at the
meeting of the Board of Directors is set out as below: Based on the total number
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
of 5,536,677,733 shares of the Company enjoying profit distribution rights as of
April 29, 2022 (the total stock capital of 5,914,469,040 shares excluding the
377,791,307 shares held in the repurchase account of the Company), the
Company plans to distribute all shareholders a cash dividend of RMB 20 (tax
included) per 10 shares, but does not plan to give any bonus share or use any
public reserve funds for capitalization.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Table of Contents
Section I Important Notice, Table of Contents and Paraphrase ............................. 1
Section II Company Profile and Main Financial Indices ........................................ 6
Section III Management Discussion and Analysis.................................................. 12
Section IV Corporate Governance ........................................................................... 72
Section V Environmental and Social Responsibility .............................................. 99
Section VI Important Matters .................................................................................111
Section VII Changes in Shares and Shareholders ................................................ 141
Section VIII Related Information of Preferred Share ......................................... 153
Section IX Related Information on Bonds ............................................................ 154
Section X Financial statement ................................................................................ 155
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
References
(I) The accounting statements signed and sealed by Dong Mingzhu, the legal representative, Liao Jianxiong, chief accountant and Liu
Yanzi, head of accounting department.
(II) The original audit report sealed by China Audit Union Power Certified Public Accountants Co., Ltd. and signed and sealed by
certified public accountants Han Zhenping and Qiu Yiwu.
(III) Originals and original drafts of all the Company's documents and announcements published on the newspapers designated by
CSRC and on www.cninfo.com.cn within the Report Period.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Paraphrase
Items Means Contents
Company, the Company, the enterprise, GREE
Means GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
ELECTRIC APPLIANCES or GREE
GREE GROUP Means Zhuhai Gree Group Co., Ltd.
Zhuhai Mingjun Means Zhuhai Mingjun Investment Partnership (Limited Partnership)
Finance Company Means Zhuhai Gree Group Finance Company Limited
Jinghai Internet Means Jinghai Internet Technology Development Co., Ltd.
GREE Altairnano, GREE Altairnano New GREE Altairnano New Energy Inc. (former name: Yinlong New Energy
Means
Energy Co., Ltd.)
CSRC Means China Securities Regulatory Commission
Report Period Means January 1, 2021 to December 31, 2021
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section II Company Profile and Main Financial Indices
I. Company information
Stock Abbreviation GREE ELECTRIC APPLIANCES Stock Code 000651
Stock Exchange Shenzhen Stock Exchange
Name in Chinese 珠海格力电器股份有限公司
Name Abbreviation in Chinese 格力电器
Name in Foreign Language (if any) GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
Name Abbreviation in Foreign
GREE
Language (if any)
Legal Representative Dong Mingzhu
Room 608, No. 108, Huitong Third Road, Hengqin New Area, Zhuhai City, Guangdong
Registered Address
Province
Post Code of Registered Address 519031
Historical Changes of the On August 26, 2021, it was changed from Jinji West Road, Qianshan, Zhuhai City, Guangdong
Company's Registered Address Province to its current registered address
Business Address Jinji West Road, Qianshan, Zhuhai City, Guangdong Province
Post Code of Office Address 519070
Website http://www.gree.com.cn
Email gree0651@cn.gree.com
II. Contacts and contact information
Board Secretary Securities Affairs Representative
Name Deng Xiaobo Zhang Zhouhu, Yan Zhangxiang
Jinji West Road, Qianshan, Zhuhai City, Jinji West Road, Qianshan, Zhuhai City,
Address
Guangdong Province Guangdong Province
Tel. 0756-8669232 0756-8669232
Fax 0756-8614998 0756-8614998
Email gree0651@cn.gree.com gree0651@cn.gree.com
III. Information disclosure and place of the report
Website of the stock exchange to which the China Securities Journal, Securities Times, Shanghai Securities News and
Company's Annual Report is disclosed Securities Daily
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Media to which the Company's Annual Report is
http://www.cninfo.com.cn
disclosed and their website
Place where the Annual Report is available for
Investment Management Department of the Company
inspection
IV. Alteration of registration
Organization code 91440400192548256N
Changes (if any) in the main business since
No change
listing of the Company
On December 2, 2019, Gree Group and Zhuhai Mingjun signed the Share Transfer
Agreement. Gree Group planned to transfer 902,359,632 shares of the Company with
unlimited sales conditions held by Gree Group to Zhuhai Mingjun at a price of RMB
46.17/share; On December 13, 2019, the Zhuhai Municipal People's Government and
the State-owned Assets Supervision and Administration Commission of the State
Changes (if any) in the controlling Council (SASAC) of Zhuhai City separately approved the share transfer.
shareholders Gree Group obtained the Transfer Registration Confirmation issued by China
Securities Depository and Clearing Corporation Limited (CSDC) Shenzhen Branch on
February 3, 2020. The share transfer registration procedures for the transfer of this
agreement have been completed, and the transfer date is January 23, 2020. After the
completion of the share transfer registration, the Company has neither a controlling
shareholder nor an actual controller.
V. Other related information
Accounting firm engaged by the Company
Name of the Accounting Firm Union Power Certified Public Accountants (Special General Partnership)
Office Address No. 169 Donghu Road, Wuchang District, Wuhan City
Names of Accountants as
Han Zhenping, Qiu Yiwu
Signatories
Sponsor engaged by the Company to perform continuous supervision during the Report Period
□ Applicable √ Not applicable
Financial adviser engaged by the Company to perform continuous supervision during the Report Period
□ Applicable √ Not applicable
VI. Main accounting data and financial indices
Whether the Company has retroactive adjustment or restatement of previous accounting data
□ Yes √ No
Increase/Decrease over
2021 2020 2019
the previous year
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Operating Revenue (Yuan) 187,868,874,892.71 168,199,204,404.53 11.69% 198,153,027,540.35
Net profit attributable to
shareholders of listed Company 23,063,732,372.62 22,175,108,137.32 4.01% 24,696,641,368.84
(Yuan)
Net profit attributable to
shareholders of listed Company
21,850,050,895.31 20,285,816,036.00 7.71% 24,171,511,911.32
less non-recurring gains and losses
(Yuan)
Net cash flow generated from
1,894,363,258.72 19,238,637,309.16 -90.15% 27,893,714,093.59
operating activities (Yuan)
Basic earnings per share (Yuan per
4.04 3.71 8.89% 4.11
Share)
Diluted earnings per share (Yuan
4.04 3.71 8.89% 4.11
per Share)
Weighted average return on net
21.34% 18.88% 2.46% 25.72%
assets
Increase/Decrease over
At the end of 2021 At the end of 2020 At the end of 2019
the previous year
Total asset (Yuan) 319,598,183,780.38 279,217,923,628.27 14.46% 282,972,157,415.28
Net asset attributable to
shareholders of listed Company 103,651,654,599.87 115,190,211,206.76 -10.02% 110,153,573,282.67
(Yuan)
The net profit of the Company before and after deducting non-recurring profits and losses in the last three fiscal years, whichever is
lower, is negative, and the audit report of the last year shows that the Company's ability to continue as a going concern is uncertain
□ Yes √ No
The net profit before and after deducting non-recurring profits and losses, whichever is lower, is negative
□ Yes √ No
VII. Accounting data differences under domestic and foreign accounting standards
1. Differences in net profit and net assets in the financial report disclosed under international accounting
standards and that disclosed under domestic accounting standards
□ Applicable √ Not applicable
There was no difference in net profit and net assets in the financial report disclosed under international accounting standards and that
disclosed under domestic accounting standards during the Report Period.
2. Differences in net profit and net assets in the financial report disclosed under overseas accounting
standards and that disclosed under domestic accounting standards
□ Applicable √ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
There was no difference in net profit and net assets in the financial report disclosed under overseas accounting standards and that
disclosed under domestic accounting standards during the Report Period.
VIII. Quarter-based main financial indicators
Unit: Yuan
Quarter 1 Quarter 2 Quarter 3 Quarter 4
Operating revenue 33,189,408,213.61 57,862,663,732.52 47,082,608,837.26 49,734,194,109.32
Net profit attributable to
3,442,899,755.09 6,013,919,597.77 6,187,957,163.99 7,418,955,855.77
shareholders of listed company
Net profit attributable to
shareholders of listed companies
3,299,482,181.81 5,492,272,396.33 5,970,530,098.50 7,087,766,218.67
after deduction of non-recurring
profit and loss
Net cash flows from operating
-4,265,483,021.72 -1,805,736,890.49 12,533,051,153.77 -4,567,467,982.84
activities
Whether major differences exist between the above financial indicators or their sum and those in the disclosed quarterly report and
semi-annual report
□ Yes √ No
IX. Non-recurring profit and loss items and amounts
√ Applicable □ Not applicable
Unit: Yuan
Item Amount in 2021 Amount in 2020 Amount in 2019 Description
Gains and losses from disposal of For details, see Note
non-current assets (including the provision -7,498,891.48 -4,974,224.62 -9,293,929.38 (V) 63, Note (V) 64,
for asset impairment write-off part) and Note (V) 65
Governmental subsidies recorded into the
current gains and losses (excluding the
governmental subsidies closely relating to
For details, see Note
the normal business operations of the
875,778,734.20 1,346,168,393.38 1,215,852,371.66 (V) 58 and Note (V)
company, conforming to national policies
64
and regulations, and enjoyed by a fixed
quota or a fixed amount in accordance with
a certain standard)
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Capital occupation fee collected from the
non-financial institution and recorded into 6,234,097.19 883,505.62 359,713.10
the current gains and losses
Gains and losses caused by fair value
changes from the holding of trading
financial assets and trading financial
liabilities, and investment income obtained
from the disposal of trading financial assets, 369,460,356.97 877,450,950.74 1,449,722.86
trading financial liabilities, and
available-for-sale financial assets, except for
the effective hedging business related to the
Company's normal business operations
Reversal of impairment provision for the
accounts receivable for which an 16,844,984.00
independent impairment test is conducted
For details, see Note
Non-operating incomes and expenditures
58,510,843.19 50,024,914.68 -530,486,147.03 (V) 64 and Note (V)
other than the above items
65
Other profit and loss items that conform to
the definition of non-recurring profit and 13,691,263.12 17,915,425.64 997,770.17
loss
Less: Influence amount of income tax 82,923,289.84 386,974,457.37 147,189,032.83
Influence amount of minority equity 36,416,620.04 11,202,406.75 6,561,011.03
Total 1,213,681,477.31 1,889,292,101.32 525,129,457.52 --
Details of other profit and loss items that conform to the definition of non-recurring profit and loss:
√ Applicable □ Not Applicable
Item Amount in Amount in the Reason
current report same period of
period the previous
year
Other profit and loss items that conform to 13,691,263.12 17,915,425.64 Returned commission charges of personal income tax, etc.
the definition of non-recurring profit and
loss
The Company has no other profit and loss items that conform to the definition of non-recurring profit and loss.
Description of defining the non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on Information
Disclosure for Companies Offering Their Securities to the Public - Non-recurring Profit and Loss as recurring profit and loss items
□ Applicable √ Not applicable
No non-recurring profit and loss items which are listed in the Explanatory Announcement No. 1 on Information Disclosure for
Companies Offering Their Securities to the Public - Non-recurring Profit and Loss were defined by the Company as recurring profit
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
and loss items.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section III Management Discussion and Analysis
I. Industry of the Company during the report period
(I) Consumption field
Gree's products in the consumption field cover residential air conditioners, HVAC, refrigerators, washing
machines, water heaters, kitchen appliances, and environment appliances, etc.
According to the Report on China's Household Appliance Market in 2021 issued by China Center for
Information Industry Development, in 2021, the household appliance market of China recovered in an all-round
way, with the retail scale volume reaching 881.1 billion yuan, a year-on-year increase of 5.7%, basically returning
to the level before the COVID-19 pandemic.
Sales of air conditioners returned to the level before the COVID-19 pandemic, and exports became the main
growth engine. According to the statistics of ChinaIOL.com, the sales volume of residential air conditioners was
152,590,000 in 2021, a year-on-year increase of 7.9%, which was also slightly higher than that in 2019; export
was the main growth engine of residential air conditioner industry, in 2021, the export volume of residential air
conditioners was 67,890,000, a year-on-year increase of 11.0%; domestic sales volume was 84,700,000, a
year-on-year increase of 5.5%. In 2021, the sales volume of central air conditioner was about RMB 123.2 billion,
with a year-on-year increase of 25.4%.
The retail sales of household appliances in online channels once again exceeded those in offline channels in
China. The growth rate of online and offline market scale has changed from negative to positive. Moreover, under
the continuous and profound impact of COVID-19 pandemic, the retail sales of online channels in China
accounted for 52.9% of the entire household appliance market in 2021, with a proportion more than 50% for two
consecutive years.
High quality household appliances are favored, and emerging household appliances continue to sell well.
Among traditional household appliances, products with larger size, larger capacity and higher quality, such as
inverter air conditioners, multi-door refrigerators, high-capacity washing and drying integrated washing machines
and high suction range hoods, are favored. Among the emerging household appliances, the demand for fresh air
conditioners, partitioned washing machines, clothes dryers, water purification and hot water all-in-one machine,
multi-functional high speed blenders, air fryers, integrated stoves, floor scrubbers, cosmetic instruments and pet
appliances is more fine sorted, and the products with improved quality continue to sell well.
The policy of green intelligent household appliance going to the countryside will be launched, and the
potential of the sinking market is huge. The household appliance market of the sinking market, which accounts for
70% of China's population, reached RMB 277.5 billion in 2021, accounting for 31.5%, with a year-on-year
increase of 8.9%, which is much higher than the overall market, becoming the most important growth pole of the
household appliance market. Universal household appliances are still the main sales in the sinking market, and
there is still a large gap between the number of main household appliances per 100 households in rural areas and
that in cities. For example, the number of air conditioners owned by 100 households in cities is 150, while that in
rural areas is only 74. The penetration rate of kitchen appliances, environment appliances and personal care
appliances in rural areas is lower. With the continuous improvement of rural residents' consumption capacity, the
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
gradual improvement of network and logistics infrastructure, and the rapid integration of urban and rural
household appliance consumption concepts, the sinking market has become the household appliance consumption
market with the largest population base, the largest area and the greatest potential in China. On March 5, 2022,
Premier Li Keqiang proposed in the Government Work Report to encourage local governments to carry out the
policy of green intelligent household appliance going to the countryside and old for new service, which will
certainly promote the further growth of the sinking market of household appliances.
(II) Industrial field
Gree's products in the industrial field cover high-end equipment, precision moulds, compressors, motors,
industrial energy storage, new energy buses, and new energy special vehicles, etc.
The intelligent equipment sector continues to grow. The combination of post-pandemic economic recovery
and industrial transformation and upgrading, coupled with the promotion of national strategies such as "Made in
China 2025" and the Development Plan on Smart Manufacturing During the "14th Five-Year Plan", China's
intelligent equipment sector has achieved rapid development. According to the data of the National Bureau of
Statistics, the added value of China's equipment manufacturing industry increased by 12.9% year-on-year in 2021,
accounting for 32.4% of the added value of industries above designated size; the output of industrial robots was
366,000 sets, a year-on-year increase of 67.9%.
Technology-intensive industries drive the development of intelligent equipment. The demand increment of
intelligent equipment in 2021 mainly comes from technology-intensive industries such as new energy vehicles, 3C
electronics and medicine. According to the data of the GGII, in 2021, the sales volume of industrial robots in
China exceeded 261,000 sets, with a year-on-year increase of more than 53%, accounting for more than 50% of
the global sales volume, and China has become the world's largest consumer of industrial robots for 8 consecutive
years.
The development direction of intelligent equipment is to meet the needs of industrial upgrading. The
development demand of industrial manufacturing is improvement of production efficiency, improvement of
product quality and customized production. Intelligent equipment is the carrier to realize the demand of industrial
manufacturing, and will develop in the direction of high precision, high stability and flexible production.
China's intelligent manufacturing industry has clear objectives and great growth potential. The development
level of high-end intelligent equipment is not only the standard to measure the development level of a country's
manufacturing industry, but also the basis for industrial upgrading of a manufacturing power. Therefore, it has
been strongly supported by national policies. It is clearly stated in the Development Plan on Smart Manufacturing
During the "14th Five-Year Plan" that by 2025, 70% of manufacturing enterprises above designated size will be
generally digitalized and networked, and build more than 500 intelligent manufacturing demonstration plants
leading the development of the industry. Driven by national policies and industrial upgrading needs, China's
intelligent manufacturing industry has great growth potential in the future.
Industrial upgrading will accelerate the survival of the fittest in the mould industry. China is a big country in
mould manufacturing and trade in the world. According to the data of Zhongshang Industry Research Institute, the
market scale of China's mould industry is expected to be RMB 302.833 billion in 2021, with a year-on-year
increase of 9.5%. With the implementation of national intelligent manufacturing and industrial upgrading policies,
leading enterprises in the industry will increase R&D investment, accelerate the automation upgrading of
production lines, and improve the development level of new products; the industry will accelerate the survival of
the fittest, and market resources will gradually concentrate on advantageous enterprises in the industry, which is
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
conducive to the development of advantageous enterprises.
The sector of core air conditioning parts returned to growth. Thanks to the effective control of the domestic
COVID-19 pandemic and the comprehensive recovery of the downstream household appliance industry, the
market has improved compared with 2020, but it has not completely recovered. According to the 2021 statistics of
ChinaIOL.com, the sales volume of rotor compressors in China was 238,570,000, a year-on-year increase of
12.8%; the sales volume of air conditioner motor in China was 392,290,000, a year-on-year increase of 10%. With
the implementation of new energy efficiency policy and carbon peaking and carbon neutrality policy, and the
continuous rise of global raw materials, the upgrading of product structure is imperative.
Under the strong impetus of the national "carbon peaking and carbon neutrality" strategy, green industries
such as energy storage and new energy vehicles have ushered in unprecedented development opportunities.
The state has made clear the development objectives of the energy storage industry, and the industry will
accelerate its development. In July 2021, the National Development and Reform Commission and the National
Energy Administration jointly issued the Guidance on Accelerating the Development of New Energy Storage,
which defined and quantified the development objectives of the energy storage industry for the first time at the
national level. It is expected that the installed capacity of new energy storage will reach more than 30,000,000
KW (30 GW) by 2025. From 3.28 GW at the end of 2020 to 30 GW in 2025, the scale of the new energy storage
market will be expanded to 10 times the current level in the next five years, with an average annual compound
growth rate of more than 55%. Positive policy signals will guide the inflow of social capital and boost the rapid
arrival of trillion energy storage market.
The sales volume of new energy special vehicles reached a new high, leading the new energy commercial
vehicle market. Driven by the introduction of new energy logistics vehicle policies, the expansion of urban
distribution scale, the new regulations for blue license plate light trucks and the rise of switching mode for heavy
trucks, new energy special vehicles have achieved explosive growth, according to the terminal license plate
enrolling data, the cumulative sales of new energy special vehicles in 2021 were 160,700, with a year-on-year
growth of 125.6%. Due to the decline of subsidies and the gradual saturation of the market, the sales volume of
new energy buses above 6 meters decreased by 17% year-on-year. Enterprises with new energy special vehicles,
new energy buses, and new energy auto parts simultaneously can quickly adapt to market changes.
II. Major businesses engaged in during the Report Period
Gree Electric Appliances, Inc. of Zhuhai is a diversified and technological global industrial group and has
three major consumer brands: Gree, TOSOT and KINGHOME, and industrial brands: LANDA, Kaibang, and
Xinyuan, etc. In consumption field, it covers residential air conditioners, HVAC, refrigerators, washing machines,
water heaters, kitchen appliances, environment appliances, communication products, smart buildings, and smart
household appliances; in industrial field, it covers high-end equipment, precision moulds, freezers and
refrigeration equipment, motors, compressors, capacitors, semiconductor devices, precision casting equipment,
basic materials, industrial energy storage, and renewable resources. Gree's products are sold in more than 180
countries and regions, providing global consumers with satisfactory products and services, for the purpose of
creating a better life.
In 2021, Gree was again listed in the Forbes Global 2000 - World's Best Employers and ranked the 252th,
and listed in the Fortune Global 500 and ranked the 488th by virtue of its outstanding comprehensive strength.
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According to the data released by HVAC Information, Gree was the only brand with a sales scale of more
than RMB 20 billion in China's central air conditioning industry in 2021 and has maintained the position for ten
consecutive years in the Chinese market, among them, Gree ranked first among national brands with a share of
more than 20% in VRF, and was far ahead of the second with a share of 34.8% in unitary air conditioner.
According to the 2021 domestic sales data of air conditioner published by ChinaIOL.com, Gree air conditioners
ranked the first in the field with a share of 37.4%, taking the lead for 27 years.
In 2021, Gree continued to enrich the categories of home appliances, strengthened the marketing of new
media channels, and achieved good results. According to the data of All View Cloud, in 2021, Gree's online retail
sales share of electric heaters, electric fans, dehumidifiers, air source water heaters and other products ranked
among the top two in the industry.
Gree takes "To be Global Leading Air Conditioning Enterprise" as its corporate vision, and "carrying forward
the industrial spirit, mastering core technologies, pursuing perfect quality, providing first-class services, and
achieving ‘Made in China, Loved by the World’" as its mission. By adhering to the management philosophy that
"innovation never stops", Gree focuses on independent innovation and development, in order to grasp the pulse of
the times, build a world brand and create a development model with Chinese characteristics for Chinese
manufacturing enterprises.
III. Core competence analysis
Facing new opportunities and challenges, Gree takes "mastering core technologies and forging perfect
quality" as the two wheels for driving, transfers and improves the value through unique marketing model, sticks to
independent people cultivation, independent innovation and independent production, and takes "carrying forward
the industrial spirit, mastering core technologies, pursuing perfect quality, providing first-class services, and
achieving Made in China, Loved by the World" as its mission to stride forward.
(I) World famous brand, continuing to create value for the society
Gree is a diversified technological global industrial group integrating R&D, production, sales and service.
Gree has won a great number of honors such as "World Brand", "Most Competitive Brand in the Market",
"National Quality Award", "Export Inspection Exemption Enterprise" and "China Brand Innovation Award" over
these years.
In 2021, Gree was again listed in the Forbes Global 2000 and ranked the 252th, and listed in the Fortune
Global 500 and ranked the 488th by virtue of its outstanding comprehensive strength.
In May 2021, the "2021 China Brand Value Evaluation Information List" jointly sponsored by Xinhua News
Agency, China Council for Brand Development, China Appraisal Society and SASAC News Center was released,
and Gree ranked first in the household appliance industry, with a brand value of RMB 120.778 billion, an increase
of RMB 6.675 billion compared with last year.
Gree has always been adhering to the core sense of worth of “quality first, customer satisfaction, good faith
management, and win-win situation”, and forging its brands and creating social value, environmental value and
economic value for the society and consumers depending on its perfect quality and world-leading technologies.
(II) Excellent R&D strength, continuously leading technological innovation of the industry
Gree insists on "independent research and development of core technologies", and has set up a technological
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innovation system of "enterprise regarded as the main player, market as the orientation,
enterprise-university-research cooperation". It insists on innovation driving, cultivates innovative talents,
implements the leader strategy, and constantly consolidates its global leading position in the field of refrigeration.
Gree boasts the largest R&D center of air conditioners in the world, including 4 national R&D centers, 1
academician workstation, 16 research institutes, nearly 1,000 laboratories. Its national R&D centers are the
National Key Laboratory on Air Conditioning Equipment and Energy-saving System Operation, National
Engineering Research Center of Green Refrigeration Equipment, State Recognized Enterprise Technology Center
and National Industrial Design Center. In 2021, Gree was approved to establish Guangdong Key Laboratory for
Enterprises of High-speed Energy Saving Motor System.
Gree Electric continued to lead the industry in testing, certification and standards. Gree has built more than
300 professional laboratories for thermal balance, noises, reliability, electrical safety, electromagnetic
compatibility, etc., and has been successively recognized by a variety of national or international organizations
(including CNAS, TUV, UL, CSA, VDE, ITS, SGS, BV, and AHRI, etc.), growing into the largest experimental
center in the industry that can provide the most complete tests and receive the largest number of national and
international recognitions. Gree has actively led or participated in the formulation of more than 570 international
standards and national standards. In terms of international standards, Gree took the lead in formulating two
international standards for photovoltaic direct-drive technology, laying a solid foundation for Gree's photovoltaic
air conditioning products to enter the international market; it participated in the formulation and revision of 13
international standards for household appliances and national standards for air conditioning in the United States
and Canada, and continuously made new breakthroughs and new competitive advantages in international
standardization. Gree has successively become the research and evaluation base of the National Notification
Enquiry Center, the first batch of National Demonstration Base for Standardization of Consumer Goods, the
National Energy Conservation Standardization Demonstration Pilot and the National Pilot Enterprise for
Standardization of High-end Equipment Manufacturing Industry.
By the end of 2021, Gree had won 99 important awards at the national, provincial and industrial levels; had
accumulatively applied for 96,626 domestic and foreign patents, including 49,549 invention patents, had obtained
13,507 invention patent grants at home and abroad and become the first household appliance enterprise in China
with more than 10,000 invention patents granted; had won 65 Chinese patent awards in total, including two gold
awards for invention and three gold awards for appearance, ranking first in the air conditioning industry in terms
of the total number of awards; had won 11 gold awards at the International Exhibition of Inventions of Geneva
and 6 iENA at the iENA. At the same time, Gree is one of the first batch of national enterprise intellectual
property demonstration unit, "National Patent Operation Pilot Enterprise", and won the China Trademark Gold
Award.
(III) Leading PQAM perfect quality assurance mode, achieving “Made in China, Loved by the World”
Gree always adheres to the principle of "quality first" and "integrity management", and constantly optimizes
the quality management system and innovates the quality control mode based on customer demand.
Gree adheres to the quality policy of "pursuing the perfect quality, creating an international brand, and
forging a century enterprise", take "best service not requiring after-sales service" and "zero defect" as the quality
goal, always sticks to the quality culture of "strict, true and new" oriented to customer demand and social
responsibility, with independent talent training as the core, establish an all-round quality education and training
system. In the process of "practice - summary and innovation - practice again - summary and innovation again", a
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comprehensive quality management model of independent innovation with Gree characteristics has been gradually
formed, and the T9 comprehensive quality control system centered on the quality technology innovation cycle
D-CTFP has been created and implemented.
Quality is related to "two lives", one is the life of consumers and the other is the life of enterprise. The
quality level of Gree's products has been steadily improved by strengthening the internal quality control, and the
after-sale failure rate has been declining for many consecutive years. In March 2021, Gree put forward the
"ten-year free repair policy" for residential air conditioners, which led the progress of domestic air conditioning
service standards and reflected the strength of Gree's air conditioning product quality and after-sales service
beyond national standards.
Gree adheres to the original intention of "taking consumer demand as the highest standard" and contributes to
the high-quality development of Made-in-China products with the spirit of "conduct self-examination". In 2018,
Gree won the “China Quality Award” issued by the State Administration for Market Regulation relying on its
perfect quality management mode of "Made in China, Loved by the World"; in 2020, based on the "perfect quality
management mode", Gree participated in the drafting and development of the Quality Management - Innovation
Cycle Guide Based on Customer Demand as a national standard, with a view to publicizing Gree's advanced
quality management experience throughout the industry and promoting continuous improvement of the quality
level of the whole industry. In November 2021, Gree won the title of "National Market Quality Credit AAA Grade
User Satisfaction Benchmarking Enterprise", which demonstrated consumers' recognition of Gree's high-quality
products and Gree's strong strength as an industry leader.
(IV) The full series of household appliances, providing consumers with overall solutions for high-quality life
Gree can provide a full range of household appliances including residential air conditioners, HVAC,
refrigerators, washing machines, environment appliances, kitchen appliances and home appliances, fully meeting
consumers’ all-round needs for high quality life. The new household appliances launched in 2021 include Real
Purify formaldehyde removal air conditioner, Freair series two-way fresh air conditioner, Wisdom Wind air
conditioner for the aged, Painting Era AI audio-visual air conditioner, Kinghome refrigerator with all-round
freshness preservation, Almighty King Shuzun II air source water heater, Automatic Drum Washer&Heat Pump
Clothing Care Dryer, EcoSilence Drive washing machine, Jinghuan Series dishwasher, steam oven, gas stove with
anti-burning protection, sweeping robot, water softener, central water purifier, desktop water dispenser, car air
purifier, tower air cooler with cooling and heating function, graphene baseboard heater, household dryer, sparkling
water maker, air fryer, ultrasonic cleaner, and health pot, etc., facilitating the consumers in their colorful life.
In addition, under the background of consumption upgrading and seriation becoming the general trend of the
industry, Gree launched five sets of household appliance products, including " Gree Serenity", "Gree Pearl",
"Gree Times", "Gree Stars" and "Gree Brevity", which fully concerned the intelligent, convenient, comfortable
and healthy personalized household needs of consumers, and created a new home experience for consumers with
the ultimate quality and aesthetic perception.
Gree Smart Home has made in-depth layout in smart home system, smart home network, smart voice
interaction, smart scene scheme and smart product technology, launched a series of smart home products, and
independently created smart IoT technologies such as IoT platform, smart decision system, G-Voice voice
interaction system, smart vision system, G-OS IoT operating system and G-Learning comfort and energy-saving
algorithm, creating a high-quality life of Internet of Everything (IoE) for consumers.
At present, Gree has laid out six technologies in the field of smart home, including smart connect, smart
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sense, smart interaction, smart cloud platform, smart energy and artificial intelligence. It also has five control
accesses, including "Gree +" App, smart voice control air conditioner, IoT mobile phone, smart door lock and
magic cube, which can cover the whole series of Gree smart products.
Gree will build Gree's "healthy, smart and comfortable home" ecological home system for consumers from
the all-round multi-system product lines of air conditioner, floor heating, fresh air, water purification and smart,
combined with the six-constant system concept of "constant temperature, constant humidity, constant oxygen,
constant cleanliness, constant mute and constant smart" in the new era.
(V) With the self-controlled new retail system, growth is driven by data
Gree insists on the sales channel construction and sales model of independent management, mutual benefit
and win-win and creates a solid online and offline business layout. The two channels complement each other and
are deeply integrated to create a full channel sales platform.
Gree has established an offline sales network covering the whole country, providing service for consumers
through its 27 sales companies and more than 30,000 exclusive stores. “Gree Dong Mingzhu's store” has been
transformed and upgraded into a comprehensive online retail e-commerce platform, selling high quality
commodities of various categories and varieties such as household appliances, food and beverage, beauty and
personal care products, clothing boutiques, and online travel products. As the market environment changes, Gree
has started the "new retail" marketing mode reform of online and offline integration. The online third-party
e-commerce platform and “Gree Dong Mingzhu's store” are deeply integrated with more than 30,000 offline
stores to provide online-offline linkage integrated services including offline experience, online ordering, and
nationwide unified distribution and installation.
Information, digital and intelligent technologies have been deeply applied to Gree's "new retail" marketing
mode. The whole chain construction and operation of new retail including the shopping mall platform, order
fulfillment system, online wholesale system, and after-sales dispatch system realizes user reaching of Gree’s new
retail online, the informatization capability empowers the channel business to drive the digital upgrade of
marketing. Relying on the Internet engineering technology and integrating the artificial intelligence, Internet of
Things and AR/VR technology, Gree promotes the digital upgrade of terminal stores through the intelligent touch
interaction mode offline, achieves the functions of product sampling, price adjustment, training, user value tag
precipitation and management in the cloud, builds Gree’s characteristic smart shopping guide stores, and
constantly improves consumers' shopping experience; uses the functions of inventory data analysis and early
warning, dynamic display and analysis of sales data and conduct data-driven operation to meet the new needs of
consumers continuously.
(VI) Precise production capacity layout and leading intelligent manufacturing level to response to market
demand rapidly
At present, according to the market demand characteristics of different products, differences in regional
production factor endowments and other factors, Gree has established production and manufacturing bases for air
conditioners, home appliances and industrial products in Zhuhai, Chongqing, Hefei, Zhongshan, Zhengzhou,
Wuhan, Shijiazhuang, Wuhu, Changsha, Hangzhou, Suqian, Luoyang, Nanjing, Chengdu, Ganzhou, Linyi, Brazil
and Pakistan, forming the highly coordinated development of industrial agglomeration and upstream and
downstream industrial chains, which ensures the independent manufacturing of core parts and drives the
development of local economy.
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Gree uses the industrial robots, intelligent logistics and warehousing and other intelligent equipment
independently developed and manufactured to continuously upgrade and transform the existing factories and build
demonstration smart household appliance factories. By 2021, Zhuhai base has been recognized as "industrial
Internet platform + green and low-carbon solution pilot demonstration" by the Ministry of Industry and
Information Technology, and Wuhu base, Chongqing base, Hangzhou base and Hefei base have been recognized
as provincial "smart factory" successively.
Precise production capacity layout and leading intelligent manufacturing level further enhanced Gree's
manufacturing and cost advantages, realized the rapid response to market demand and brought high-quality life
enjoyment to consumers.
(VII) With strong self-research and self-made ability of core components, the comprehensive
competitiveness of products continues to lead the industry
The core components of products include compressor, air conditioner motor, robot servo system, robot
motion control system, reducer, direct drive motor spindle and linear motor, etc.
Gree has been deeply engaged in the field of compressor and air conditioner motor for many years, its
capacity, technology and quality of compressor and air conditioner motor have always led the industry, and has
successively won honors such as "National Quality Award", "National High-tech Enterprise", and "National
Quality Benchmark", has built national laboratory testing centers such as "National CNAS Testing Center", "the
first UL-CTDP recognized laboratory in the domestic motor industry", and has obtained 2501 invention patent
grants, showing the hard power and brand influence of Gree's industrial product development.
10 products independently developed by Gree, including the "high efficiency scroll compressor",
"high-performance linear servo motor and driver", "high-performance servo motor and driver for industrial robot"
and "rare earth free permanent reluctance main drive motor system for new energy bus" were appraised as the
"world-leading" level, indicating that Gree has fully mastered the advanced technology from core components to
products.
Gree not only has strong R&D capability of core components, but also has excellent processing and
manufacturing capability. For example, Gree five-axis 3D curved surface processing machine tool is suitable for
machining precision parts with complex curved surfaces, with a repeated positioning precision of up to 0.002 mm
and cutting feed rate of up to 80 m/min, which can ensure the high quality of core components such as centrifugal
compressor blades.
In the diversified sector, the robot servo system currently developed by Gree has covered 600 kg-level
industrial robots, which is a special robot servo system with the largest power range in the industry; Gree's
self-developed multi-axis integrated linear servo system for machine tools has reached the "international leading"
level in key performance indices such as maximum speed, thrust density and thrust fluctuation; Gree's
self-developed precision harmonic reducer has the characteristics of compact structure, high geometric accuracy,
small back clearance and high torque; and Gree has successfully completed the development of Gree's first robot
motion control system with independent intellectual property rights. The research and development of core
components of robots and machine tools has successfully broken the technological monopoly of foreign brands
and improved the competitiveness of national brands.
The powerful R&D and manufacturing capabilities of core components ensure the high independent rate and
comprehensive competitiveness of Gree's products, and provide vigorous support for the leapfrog development of
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Gree.
(VIII) Advanced cost and supply chain management to provide guarantee for the steady development of the
Company
Gree adheres to the orientation to market demand, establishes and improves an objective-driven cost
planning and management system in consideration of the Company's business objectives: deepen product cost
control, carry out value chain analysis, decompose and analyze the impact of cost input, conversion and output of
various business links inside and outside the group on the final value of products, so as to improve operations,
reduce costs, realize value-added of value chain and form a sustainable competitive advantage.
With the goal of building an industry-leading supply chain, Gree plans supply chain management and
optimizes supply chain resources, expands the layout of upstream and downstream industries, carries out strategic
cooperation with leading enterprises in the industry, and establishes in-depth cooperative relations and resource
sharing with high-quality suppliers, so as to maximize the interests of both sides and achieve mutual benefit and
win-win results.
Promote the optimization of supply chain management with informatization. Gree realizes the automatic
collection, correlation, analysis, monitoring and push of internal and external quality information related to
materials through the technical means of big data, so as to promote the continuous improvement of material
quality. Enhance the competitiveness of the supply chain through mutual promotion with partners.
In 2021, affected by global trade friction, geopolitics, COVID-19 and other factors, the global economy was
frustrated, the price of bulk raw materials soared, and market competition and cost pressure were transmitted to
the whole supply chain step by step. Gree continued to give full play to the scale advantage of centralized
procurement, and implemented measures such as localization of key imported materials, generalization of
structure and materials, and multi-regional supply, which effectively alleviated the pressure on operation caused
by environmental changes.
In addition, Gree has further promoted the cost reduction of product design by improving product structure
design, optimizing process links, developing lean models and developing outdoor units in series; reduced the
production cost by improving the utilization rate of materials, improving the automation level and improving the
production process.
(IX) Independent talent training system to realize the supply of high-quality talents
Gree always adheres to the principle of "focusing on the strategic layout of the Company and adhering to
independent training of talents" and gradually forms an independent talent training mode with independent talent
introduction channel, independent training and development mechanism and all-round incentive and guarantee
system as the core based on the development experience and cultural deposit of the Company, striving to make
employees and the Company make progress and develop together.
Gree's talent team has been growing, its talent structure has been upgraded over the years. By the end of 2021,
the Company had about 82,000 employees, including 2 leading talents in science and technology innovation under
the National Ten Thousand Talents Program, 4 experts enjoying special allowances from the State Council, 1
winner of the Award of Outstanding Contribution to Nanyue, 1 Outstanding Talent under the Guangdong Special
Support Program, and 95 high-level talents of Zhuhai, 549 outstanding young talents, 1,097 scientific and
technological experts evaluated inside the Company, more than 6,800 intermediate and senior engineers, and more
than 30,000 skilled workers.
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In order to adapt to the transformation of the production model to automation and intelligence, the Company
accelerates the training of applied-skilled talents. The Company vigorously promoted the spirit of model workers
and craftsmen in the new era, made full use of the resource advantages of Guangdong technicians, skilled master
studios, and technician workstations to deepen the Company's high-skilled personnel training mechanism, and
selected and cultivated a group of "high-tech and cutting-edge" skilled talents through a series of measures such as
skill training, skill competition and skill grade evaluation. Up to now, the Group has 14,000 newly assessed
skilled talents, of which, 10 have won the title of "Guangdong Provincial Technical Expert", 1 has won the title of
"Nanyue Technical Expert", and 5 have won the title of "Zhuhai Municipal Technical Expert", 4 "Zhuhai
Municipal Post Technical Expert Pacesetter", 12 "Zhuhai Municipal Chief Technical Expert", 10 "Zhuhai Special
Artisan", and 233 "Zhuhai Artisan".
Employees are an important driving force for development of the Company. The Company seeks benefits for
employees through multiple channels including employee stock ownership plan, talent subsidies, talent housing,
Gree school and five-day workweek, improving the employee satisfaction and happiness through continuous
efforts.
IV. Analysis of main business
1. Overview
In 2021, facing the severe and complex macroeconomic situation such as high raw material cost and repeated
and changeable COVID-19 pandemic situation, the Company adhered to independent innovation, accelerated
diversified layout, strengthened e-commerce operation, implemented the explosion strategy, and made new
breakthroughs one after another on the road of high quality development. 1In 2020, the Company achieved the
total operating revenue of RMB 189.654 billion, an increase of 11.24% year on year, and a net profit attributable
to the parent company of RMB 23.064 billion, an increase of 4.01% year on year.
(I) Center on users, continuously provide users with innovative products
(1) Residential air conditioner sector
Gree insists on centering on user needs for development of new products, creates high-quality air
conditioners with "ten-year" free repair and fully considers new needs of users, and has successively arranged and
developed five series of new products, including Flagship, Fresh Air, Formaldehyde removal, Wisdom Wind and
Qingxiang series, and carried out technological innovation and upgrading around the three aspects of "comfort,
health and intelligence". In terms of comfort, Wisdom Wind air conditioner for the aged, the first in the industry to
serve the "silver haired group", is equipped with "constant temperature defrosting technology", which can realize
defrosting without sudden cooling and continuous heating for 10 hours, greatly improving indoor thermal comfort.
In terms of health, Real Purify formaldehyde removal air conditioner has been launched, the formaldehyde
removal grade reaches the national standard C4 grade, the depth of formaldehyde removal reaches 0.01 mg/m
which is 10 times the national standard requirements. In terms of intelligence, a new generation of Gree Painting
Series integrating air conditioning, voice control, entertainment and art appreciation has been launched.
In addition, the Company has launched a new Charmo split unit, and the final assembly automation rate was
increased by 40% with structural innovation and design; the Company has also launched a new generation of
characteristic Clvia unit, which combines AI intelligent algorithm with frequency conversion controller to save
energy by 15%, it also has a variety of humidity control schemes such as automatic comfortable dehumidification
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and humidity control, so as to meet the various needs of different customers in different environments.
(2) HVAC equipment sector
By 2021, Gree has 13 categories of HVAC products, which can meet the customized needs of customers in
different occasions.
Screw chiller and centrifugal chiller sector. Gree has launched a new generation of high-efficiency super
magnetic inverter screw chiller with high-efficiency falling film evaporator and COP of more than 7.0; high
efficiency dynamic air suspension centrifugal chiller with bearing suspended for 2 seconds; CVE-Plus ultra-high
energy efficiency series frequency conversion unit with double primary energy efficiency of the whole series of
units, modular designed screw chillers and other products.
Household central air conditioner and duct type air conditioner sector. Gree household central air
conditioner has expanded from single product sales to smart and comfortable home system integration. Gree
launched a new generation of Yiju home central air conditioner with a shell volume reduction of about 20%, high
temperature self-cleaning, motion sensing control and other new functions; Zunshu household central air
conditioner with free combination of five functional modules and ready-to-use feature; Yuxiang and Jingxiang
series air-conditioning and floor-heating household central air conditioner that accurately adjust the floor heating
temperature. In terms of air duct type air conditioners, C3 and D3 series VRV are arranged with new added
functions such as self-cleaning, dust removal and sterilization, temperature and humidity correction, etc.
Commercial VRF sector. Gree launched the "artificial intelligence VRF" with large capacity of 40HP per
single unit, the VRF indoor unit has a newly laid self-cleaning function, which can be used with VRV fresh air
unit. It also launched an "intelligent air conditioning management system" integrating remote management and
household billing functions.
Special refrigeration equipment sector. Gree has newly developed high-efficiency heat exchange and
refrigeration equipment for mines, which has overcome a series of problems such as air shortage, water shortage,
electricity shortage, high temperature, high humidity, and explosion hazard; Gree intelligent cold source group
control system integrating ice storage, magnetic bearing, inverter and other high-efficiency, energy-saving
technologies and optimized control strategies; special constant temperature and humidity unit for libraries that can
realize accurate regulation and control (T±0.5°C, RH±3%) and has an absolute moisture content as low as 5.8g/kg.
In terms of precision air conditioning products, JKF series air-cooled close control air conditioner with modular
and flexible combination, high-efficiency integrated outdoor cabinet air conditioner for 5G communication, and
variable-frequency inter column air conditioner for micro module data center has been launched. In terms of
products used for freezing and refrigeration, an integrated intelligent hot fluorine defrosting refrigeration unit has
been launched, with high defrosting efficiency, short defrosting time, and energy saving of about 36%, and a split
vertical air curtain cabinet has also been launched to improve the refrigeration equipment of retail terminals.
Heat pump water heater sector. Gree has newly developed F-series household heating and cooling
integrated unit, which meets the primary energy efficiency standard of low-temperature heat pump; has launched
Shuzun ultra-high temperature air source water heater with the highest water temperature in the industry (90°C),
which can meet the bathing needs of about 11 people at the same time.
In addition, the Company has also launched "elevator air conditioner" with efficient sterilization and dust
removal function, wall mounted fresh air unit and engineering fresh air unit. From high-quality energy-saving
products to later maintenance and management, Gree has created a set of comprehensive and perfect central
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air-conditioning solutions for customers, assisting the new development concept of "carbon peaking and carbon
neutrality" with core technology, and opening up a new path of green energy-saving development.
In 2021, the Company continued to explore the HVAC equipment market and created many model projects in
various fields. In the field of real estate, there were about 40 new and renewed customers in 2021, and the market
share of refined decoration with air conditioners reached 16%, Gree launched the VIP service system mechanism
for exclusive real estate strategic customers; in the field of public buildings, it has successfully delivered
benchmarking projects such as Museum of the Communist Party of China, National Speed Skating Oval and
National Aquatics Center, won the bid for the heating (cooling) project in Rongdong District of Xiongan New
Area, and participated in the brand shortlisting and strategic procurement of more than 10 large state-owned
construction units; in the field of data communication, it has won the bid for many projects such as centralized
purchase of precision air conditioners and chillers of the three major telecom operators, as well as projects with
national influence such as Alibaba National Data Center, Huawei Chengdu Artificial Intelligence Big Data Center
and Beijing Changping Future Science Smart City Project; in the field of transportation facilities, it has
continuously obtained airport, high-speed railway and subway projects in more than 34 cities such as Shanghai,
Guangzhou, Shenzhen, Wuhan, Hangzhou, Chongqing, Xi'an, Changsha and Jinan; in the field of high-end
manufacturing and industry, it has newly developed leading customers in power, electronics, automobile, chemical
industry, semiconductor, optoelectronics, intelligent terminals, new energy, medical devices and other industries,
and successfully won the annual centralized procurement projects of multiple strategic customers; in the field of
clean energy, it has won the bid for Xinzhou coal-to-electricity project, with a bid amount of RMB 500 million,
and has won the bid for photovoltaic air conditioning projects in many commercial squares, urban service centers
and schools; in other fields, it has built a demonstration project of special unit for hospital cleaning, successfully
won the bid for a number of top 100 hospitals, international hotel groups and large commercial complex projects,
and reached strategic cooperation with a number of large financial institutions and leading breeding enterprises.
(3) Home appliances sector
In order to improve the quality of life of users, the Company developed home appliances in the direction of
health, intelligence and personalized needs, further enriched the depth and width of our household appliance
product line and formed a systematic layout at the same time.
Environment appliances: The Company has created a variety of popular fans and launched new products
such as Lasso air purifier, sweeping robot, desktop water dispenser, and folding baseboard heater. In terms of fans,
FS-3015Bh7 series and FD-3515Bh7 series of floor fans adopt multi-concave wing blades and internal and
external double spiral acceleration guard to achieve 44 m/min large air volume and 8 m long-distance air supply,
which is very cost-effective, and obtained an order of 3.7 million sets in the first year, ranking first in the industry.
The production and sales volume of 4L tower cooling fan KS-04X60Dg series, with noise as low as 35 dB, 360
m/h large air volume, 7 m/s high wind speed, V-shaped wet curtain, and 600 ml/h large evaporation capacity, has
exceeded 1,000,000 sets, ranking first in the industry. Gree Lasso 520G air purifier can continuously decompose
formaldehyde into CO2 and H2O at room temperature, with a decomposition rate of 99%, and formaldehyde CCM
of more than 10000 mg, which is 6.6 times the highest level of the national standard. Desktop water dispenser
RJY-T16-1X611B featured with 3-second fast heating, is provided with 3000 L long-life patented four-in-one
composite filter element, intelligent double flushing mode, free combination of four cup sizes and six
temperatures, as well as ultraviolet bacteriostatic action.
Kitchen appliances: In 2021, dozens of products were launched in five categories: range hood, stove, gas
water heater, steam oven and dishwasher. New products such as sparkling water maker, air fryer and health pot
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were also launched, further enriching the kitchen appliance product line and forming a systematic layout at the
same time. Jinghuan series 302 dishwasher adopts fog free transparent cabinet door and touch color screen, with
the independently developed automatic dirt identification technology, it can realize intelligent washing, with a
sterilization rate of 99.99%; Gree X82 range hood, relying on the large air volume cleaning free technology, the
air volume is increased by 18%, realizing high static pressure and 10-year cleaning free. The embedded steam
oven uses the newly invented self-adaptive temperature control technology based on the temperature
characterization point to realize temperature control with an accuracy of 1°C, which can realize the simultaneous
steaming, baking and cooking of three dishes and rice at the same time; Gree gas water heater adopts three-stage
combustion technology to achieve accurate temperature control with a water temperature fluctuation of as low as
±0.5°C, and keep the water temperature stable when the water pressure fluctuates, with a minimum power of as
low as 3.6 kW.
(4) Refrigerator and washing machine sector.
Refrigerator sector. Taking users as the center, Gree continues to innovate in preservation, sterilization,
energy saving, intelligent interaction, etc., of refrigerators, and constantly enriches products with different doors
and different volume segments.
In 2021, the product layout was improved, and the first Qiyu purple BCD-516WPQG refrigerator was
launched in the cross door series, which is equipped with a brand-new "full-range fresh keeping" function
integrating fruit and vegetable fresh keeping, meat fresh keeping, breast milk fresh keeping and sterilization and
deodorization. This function can reduce the loss of nutrients and vitamins in fruits and vegetables and delay the
deterioration of fruits and vegetables through cell micro dormancy and water moisturizing technology; 15 minutes
quick deodorization to ensure the safety of food materials; precisely controlled constant temperature fresh keeping
technology realizes the constant temperature field of 4°C for breast milk storage with a temperature fluctuation of
within 0.5°C, effectively ensuring the stability of breast milk components; at the same time, it is equipped with
core technologies such as -5°C cell-level freezing and -33°C deep freezing, which meet consumers' ultimate
pursuit of health in the era of COVID-19 pandemic.
For small families, the newly developed embedded BCD-320WPFCL French four-door refrigerator is
equipped with five fresh-keeping modes of fruits and vegetables, zero degree, partial freezing, soft freezing and
cool fresh (instant freezing), it also adopts efficient intelligent temperature control technology and consumes only
0.69 degrees of electricity per day.
Washing machine sector. In 2021, Gree launched the upgraded products of Ruxin series washing machine with
clothes care function, which adopts differentiated technologies such as heat pump drying, drying without washing,
and molecular level care, for high-end washer dryer market; it also launched Jingyue series equipped with
pasteurization washing and high-temperature disinfection washing, which has met the demand of generation Z
market with its extreme cost performance, improved the product layout of each array of our washing machine, and
made a breakthrough in the export market.
(5) Industrial product sector.
Gree's strong R&D and manufacturing capacity of core components of household appliances has laid a solid
foundation for the development of the Company. In 2021, the representative industrial products developed by
Gree R&D team are as follows:
A new generation of household VRF rotor compressor. Gree's technical team has developed a new
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generation of household VRF rotor compressor through small-scale, high-efficiency and low-noise technology in
terms of motor and pump. Its size is reduced by 10%, the maximum energy efficiency is increased by 5%, and the
noise is reduced by more than 4 dB. The size of the compressor is the smallest in the industry. It has been mass
produced and applied to Gree's small, efficient and silent household VRF products. The product technology has
applied for 10 national invention patents and formed 4-6HP series products.
Commercial air conditioner VRF scroll compressor. Through technical breakthroughs in high-frequency
lubrication, scroll profile and broadband motor, Gree's technical team not only ensures the capacity of the
compressor, but also improves the high-frequency operation reliability of the compressor and broadens the
maximum operation frequency to 130 Hz. This series of scroll compressors have been mass produced and applied
to the fifth generation commercial VRF of Gree.
Air-cooled magnetic bearing compressor. Gree's technical team realized the stable operation of the
air-cooled magnetic bearing compressor with 35000 RPM on load, and the operation accuracy under all working
conditions was within 20 um, and output 1 SCI paper and 1 EI paper. Its successful development indicates that
Gree has broken the monopoly of foreign enterprises on the air-cooled magnetic market and become the only
enterprise in China with independent intellectual property rights of air-cooled magnetic centrifugal compressor.
High-performance servo system. Gree's original high power density design technology of servo motor
effectively shortens the axial length of the motor, solves the problems of low power density, large volume and
weight of servo motor, and promotes the miniaturization and weight reduction of robot to the greatest extent.
The special servo driver for robot developed by Gree can synchronously and accurately control multiple
motors, which solves the industrial problems of robot servo driver, such as large volume, low performance, poor
reliability, and complex installation. The robot with Gree servo system runs faster and has better reliability under
the same conditions.
Permanent magnet auxiliary synchronous reluctance motor. Compared with the asynchronous motor (IE2)
with the same power, the volume of the motor is reduced by 50% and the loss is reduced by 60%, reaching the IE5
ultra-high energy efficiency level, with significant energy-saving effect, and the rotation matrix coefficient is as
low as 5%. It has won the gold award at the International Exhibition of Inventions of Pittsburgh, and obtained
more than 30 invention patent grants.
Supporting drive motor of air compressor. Gree's technical team has overcome the technical problems of
excessive torque pulsation and large cantilever structure deflection under high speed. The motor has the
advantages of high transmission efficiency, compact structure, maintenance free, higher motor power density, low
vibration and low noise, and makes the whole air compressor reach the primary energy efficiency level. Gree has
completed the development of four series products including 15-75kW, which can meet the needs of a full range
of products for high-end customers. At present, Gree has reached strategic cooperation with domestic front-line air
compressor enterprises.
In addition, the top mounted integrated parking air conditioner developed by Gree adopts intelligent full
variable frequency control, which has the characteristics of strong refrigeration performance, humanized operation,
high safety protection degree and easy installation, and it has occupied the market rapidly since its launch; large
and small volume cycling compressor using Gree's unique technology can solve the problem of frequent start-stop
of household VRF at low load, which has been mass produced and applied; the special compressor for dryer has
overcome the problem of shutdown in low-frequency operation under steam care mode, and has realized mass
production and application; the electric drive system for special logistics vehicle and the five-in-one controller for
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new energy commercial bus have been successfully mass produced; Gree has made technological breakthroughs
in multi-axis integrated linear servo system, precision harmonic reducer, robot motion control system for machine
tools.
(II) Adhere to independent innovation, constantly make breakthrough in world-leading technologies.
Major scientific research achievements emerge one after another. In 2021, Gree achieved a series of new
technological achievements through continuous breakthroughs and overcoming of difficulties by R&D personnel.
According to the appraisal of authorities, Gree has added 4 world-leading technologies, namely "high efficiency
catalytic aldehyde removal technology at room temperature and its application in air purifiers", "air source heat
pump continuous heating efficient hot gas defrosting technology", "research and application of key technologies
of home appliances" and "research and application of key technologies of high safety and large energy storage
systems". So far, Gree has a total of 35 world-leading technologies.
In 2021, Gree won 10 important scientific and technological awards, including 5 first prizes at provincial and
ministerial level. Among them, the air source heat pump high efficiency heating key technology and
industrialization project won the first prize of Guangdong Scientific and Technological Progress Award in 2021. In
this project, Gree has overcome the industrial problems of discontinuous low-temperature heating, low defrosting
efficiency and poor defrosting comfort in winter. The overall technology has reached the "international leading"
level after being identified by China Light Industry Council and other organizations. The project achievements
have been applied and popularized in many "coal-to-electricity" projects in China, and awarded the title of "best
practice case of energy conservation in rural buildings in China". At the same time, they have been applied to the
"application and demonstration of low temperature air source heat pump heating in Mongolia" project, which has
promoted China's efficient heating technology to the world and showed China's strength.
In 2021, Gree's "zero carbon source" air conditioning technology won the highest award in the "Global
Cooling Prize". This technology integrates advanced technologies such as vapor-compression refrigeration,
photovoltaic direct drive, evaporative cooling and mechanical ventilation. It can make efficient use of solar energy
and natural cold sources (air and water), and intelligently select one or more of the three modes of vapor
compression refrigeration, evaporative cooling and ventilation according to outdoor meteorological conditions, so
as to provide a more energy-saving and comfortable air conditioning scheme for the room. Combined with the use
of environmentally friendly refrigerants, the impact of residential air conditioner power consumption and
refrigerant emission on the climate can be greatly reduced. After the popularization of Gree's "zero carbon source"
air conditioning technology, it will help the global refrigeration industry realize carbon neutrality in advance.
Actively lead or participate in standard formulation. In June 2021, the first batch of national consumer
goods standardization pilot projects successfully passed the national acceptance, indicating that Gree, as a leading
enterprise in the manufacturing industry, has been recognized by authority in the field of standardization
construction. In October 2021, Gree, as the leader unit, led the establishment of a national DC controller standard
working group to filled in gaps of DC controller standards and assisted the development of DC appliances in
China. In 2021, Gree was listed in 2021 National Enterprise Standard "Leader" with 19 product categories
including air conditioner, refrigerator, washing machine, rice cooker, air purifier, electric fan and water purifier,
etc., more than 300 product models, and 24 standards, and it is the enterprise with the most products included in
the list in the household appliance industry, boosting the high-quality development of products.
In terms of international standards, in June 2021, Gree took the lead in establishing the IEEE PES DC Power
System Technical Committee (China) Low Voltage DC Technology Subcommittee, assisting the development of
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China's low voltage DC power system. In December 2021, the photovoltaic international standard proposal IEC
TS 63349-2 Photovoltaic Direct-Driven Appliance Controllers - Part 2: Operation Modes and Graphic Display,
led by Gree, was approved and released in IEC/TC82, filling in gaps in the international standard of photovoltaic
direct-driven appliance controller industry and providing the basis for the design, testing and certification of
photovoltaic direct-driven appliance. In 2021, Gree participated in the formulation of three ISO heat pump
international standards, which were affirmed by ISO refrigeration and Air Conditioning Committee and officially
released.
Strengthen the protection and application of intellectual property rights. The total number of patent applied
by Gree at home and abroad was 13,849 in 2021, including 8,214 invention patents; the number of invention patent grants was 3,128,
including 3,008 domestic invention patent grants, and Gree was the only household appliance enterprise that has entered China's top
ten household appliance enterprises in terms of quantity of invention patent grants for 6 consecutive years. In 2021, Gree again won
major invention awards at home and abroad: Gree won Chinese patent awards, including 1 gold award, 1 silver award and 17
excellence awards, ranking first in terms of the total number of awards, and won the first gold in the invention patent of the central
air conditioning industry; won 2 patent gold awards in provincial level; at the International Exhibition of Inventions of Geneva and
Nuremberg, Gree won 6 gold awards and 2 silver awards, once again demonstrating the power of Gree in creation to the world.
Continuously improve the capability of product design. Gree continued to increase its investment in the
R&D of new products in new areas, made breakthrough progress in the product series design, CMF planning and
desing, user experience and UI design with product series design and sub-appearance design as the core. Adhering
to the principle of concentration and diversified development, it promoted the development of original products,
and made outstanding achievements in the field of industrial design. Gree received 15 awards of three major
International Design Awards (3 IF Product Design Awards in Germany, 2 Red Dot Awards in Germany, 8 IDEA
Awards in the United States, and 2 Good Design Awards (G-Mark) in Japan), and 8 Canton Fair Design Awards.
(III) Implement the perfect quality assurance mode and put forward the "ten-year free repair policy" for
residential air conditioner
To meet the consumers' requirement for pursuing a high quality life, Gree has been committed to providing
high quality products. The quality level of Gree's products has been steadily improved by strengthening the
internal quality control, and the after-sale failure rate has been declining for many consecutive years. In March
2021, Gree put forward the "ten-year free repair policy" for residential air conditioners, which led the progress of
domestic air conditioning service standards and reflected the strength of Gree's air conditioning product quality
and after-sales service beyond national standards. In the China Customer Satisfaction Index (C-CSI) issued by
China National Institute of Standardization, Gree ranked first in the category of air conditioners, and has topped
the list for 11 consecutive years.
In terms of quality management and control, Gree continued to fully implement the PQAM perfect quality
assurance mode and vigorously promote zero defect management in all links of the product life cycle. In 2021, in
the 46th International Convention on Quality Control Circles (ICQCC) competition known as "quality Olympics",
the representative team of Gree's representative team won the highest award - Excellence Award, showing the
world the excellent quality management strength of Gree.
Gree also improved product quality through digital detection technology. In 2021, Gree's "Research and
Application of Key Technologies for Quality Improvement of Household Appliance Products based on Digital
Twins" Project won the first prize of Quality Technology Award of China Association for Quality.
Recently, The Air Disinfection and Purification Solution Based on CKER System and its Application of Gree
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won the Quality Innovation Award, which is the best achievement of the current Chinese delegation. As a quality
benchmark of Chinese enterprises, Gree once again demonstrated the strength of Made-in-China products to the
world.
(IV) Accelerate the industry layout and the diversified pattern is gradually emerging
(1) Intelligent equipment sector
Zhuhai Gree Intelligent Equipment Co., Ltd. is an intelligent equipment enterprise integrating R&D,
production, sales and service, possessing 15 R&D units, 7 technical service centers and more than 600
technicians.
Under the general trend of transformation and upgrading from "traditional manufacturing" to "intelligent
manufacturing", Gree has seized the opportunity by making continuous efforts in the front-end cores of the
industrial chain, and has made successive breakthroughs in key technologies such as high-performance servo
systems, direct-drive electric spindles, linear motors, reducers, controllers and drive-control integration, which
have boosted the improvement of core competitiveness in domestic robots and CNC machine tools. At the same
time, it has also made breakthroughs in heavy-duty and highly rigid robot technology, intelligent logistics core
technology, product defect visual inspection and other key technologies.
Gree has been attaching great importance to the development and accumulation of independent technology,
and has applied for more than 3,180 patents at this stage, in which there are 2,143 invention patents, and it
possesses 1,294 authorized patents, and won one gold medal at the Geneva International Invention Exhibition in
2021. By means of its excellent R&D and manufacturing capability, Zhuhai Gree Intelligent Equipment Co., Ltd.
was awarded such honors as Guangdong Top 500 Manufacturing Enterprise No.247, Guangdong Industrial Robot
Backbone Enterprise, Guangdong Artificial Intelligence Cultivation Enterprise, and Guangdong Intelligent
Manufacturing Ecological Partner.
Gree Intelligent Equipment focuses on four series of products: CNC machine tools, industrial robots,
intelligent warehousing and logistics, and factory automation, and provides intelligent equipment for many
leading enterprises in the industry at home and abroad, boosting them to upgrade their automation.
In terms of CNC machine tools, it has optimized and upgraded the existing products, expanded the market
scale in 5G communication, machinery manufacturing and medical treatment fields, focusing on machine tools
that process structural parts of high speed, high torque electric spindle, linear motor, high-speed movement and
high acceleration for new energy vehicles, as well as providing one-stop solutions for global leading enterprises of
new energy vehicle manufacturing in cooperation with renowned parts manufacturing enterprises.
In terms of intelligent warehousing and logistics, Gree Intelligent Equipment, based on the technical planning
route, has set up demonstration projects of intelligent logistics three-dimensional warehouse in the head
enterprises of electric power, machinery manufacturing, food cold chain, auto parts and other industries in China
and overseas markets, and made project breakthroughs in new fields such as rubber tires, book publishing and
beauty makeup manufacturing.
In terms of industrial robot and automation solutions, Gree Intelligent Equipment, based on the rich project
experience and application cases accumulated in the manufacturing fields of electric motor, small household
appliance, stamping, machining, etc., has continuously explored external markets. At the same time, it has
expanded application scenarios by timely entering the emerging markets or subdivided fields such as photovoltaic
and wood industry, and as of now, it has provided robot and automation solutions for many famous enterprises,
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which boosted these enterprises to upgrade their intelligent manufacturing.
(2) Precision mold sector
Mold is known as the "mother of industry", and the level of its technology is one of the important symbols to
measure the level of a country's manufacturing industry.
Gree Precision Mold Co., Ltd adheres to the strategy of "Refinement, Standardization, Specialization and
Productization" and continues to make efforts in the fields of molds for intelligent household appliances, motors,
automobiles, medical care, office supplies and new energy components. Now it possesses 4 R&D platforms, 1
national-level skilled master studio, 1 municipal-level skilled master studio, 1 municipal-level skill workstation, 5
manufacturing plants and 12 technical manufacturing service centers, with over 500 technicians.
Gree Precision Mold Co., Ltd attaches importance to the research and development of cutting-edge
technology and new fields. By 2021, Gree Precision Mold Co., Ltd has applied for 492 patents and obtained 344
authorized patents. It has independently developed core technologies such as 0.001 mm grade mold high-precision
processing technology, near zero degree deformation molding technology, high brightness appearance molding
technology, imitation plating mold technology, and zero defect appearance mold technology.
The mold company began to face the external market since 2016, dedicated to the production and
manufacturing of precision molds, and now it possesses 1,200 sets of international leading precision processing
equipment, and has mastered five major technologies, namely 3D printing, flash powder + high-gloss injection
molding, RHCM molding technology, two/three color molding technology, optical imitation plating technology,
mainly serving customers in the specialized fields of automotive exterior and lights, consumer electronics, smart
household appliances, motor high impact, multi-cavity precision, and biodegradation.
(3) Photovoltaic (storage) air conditioning sector
The business scope of Gree Photovoltaic (Storage) Air Conditioning with Zero Carbon Source includes
photovoltaic (storage) DC air conditioning system, new energy DC appliance, energy storage and near-user side
energy Internet system, etc.
In 2021, Gree photovoltaic (storage) air conditioning system successively won bids for significant projects
such as Xiong'an New Area Investment Service Center in Hebei, Caidian City Service Center in Wuhan, Jiuli
Center HVAC Station in Jiangsu, and Huijin Commercial Center, etc. The low-carbon technology products and
system solutions launched by Gree Electric Appliances were highly praised by partners and welcomed by the
market.
In 2021, it implemented 13 model projects and order projects. Suzhou Tonglihujiayuan passive building is
the first passive house project in China, which realizes zero energy consumption by self-generation of electricity,
and also has passive energy storage, room temperature regulation and smart voice control of home appliances, etc.
The project has been certified by both the Science and Technology Development Center of the Ministry of
Housing and Construction of China and the German Energy Agency. Shenzhen Longgang International Low
Carbon City PV Future House Project is a PEDF benchmark that integrates PV power generation, energy storage,
DC power distribution and flexible power consumption. In October 2021, the Hangzhou Asian Games low-carbon
hydrogen-electricity coupling application demonstration project, which is the first "zero-carbon" green park
integrating flexible DC, hydrogen-electricity coupling and multi-energy complementarity in China, was officially
launched by Gree Electric Appliances and State Grid Hangzhou Electric Power Supply Company. The company
has been working with partners to carry out new energy DC application demonstrations and pilots, and promoting
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the research and promotion of new zero-carbon DC technologies, including the Xiong’an New Area
Dianshangfeicui (Wangjiazhai) DC demonstration project, the first multi-station low-voltage DC distribution
network demonstration project in Zhejiang, and the fine grid DC smart house project in Weihai, Shandong
province, etc.. The company is dedicated to achieving carbon peaking and carbon neutrality goals together with
partners in the power and construction industries.
In terms of platform construction, the company took the lead in establishing Guochuang Energy Internet
Innovation Center (Guangdong) Limited, initiated and hosted the Guangdong Distributed Energy Internet
Innovation and Application Alliance and constructed the Guangdong Energy Internet Innovation Center, and
successfully held the inaugural meeting of IEEE PES DC Power System Technical Committee (China) Low
Voltage DC Sub-Committee with ecological partners, and served as the chairman, showing the company's
milestone role in promoting the rapid and healthy development of China's new energy low-voltage DC technology,
which is of milestone significance to promote the rapid and healthy development of new energy low-voltage DC
technology in China and the construction of international standards in the related fields of zero-carbon DC.
In terms of new products and technologies, in 2021, Gree launched a new generation of photovoltaic (storage)
DC inverter VRF unit system, household and commercial-grade energy internet storage system, HIEMS energy
internet home/community system, FIEMS energy internet factory/park system, etc. Gree Electric Appliances also
participated in the Energy Foundation's research project "China PEDF Building Research Project" led by Tsinghua
University to establish the key technical framework for DC building appliances in collaboration with partners,
which promoted the development of new energy DC appliances.
In terms of the honor won in photovoltaic(storage) air conditioning with zero-carbon source system, the
Gree-Tsinghua University joint team won the Global Cooling Prize in April 2021, which marked another core
technological breakthrough in the field of zero-carbon air conditioning technology and provided innovative
Chinese solutions to achieve China's "double carbon" strategic goals and address global climate challenges.
Gree G-FIEMS Energy Internet Factory System was successfully selected as a pilot demonstration of
Industrial Internet Platform + Green Low Carbon Solution in 2021 by the Ministry of Industry and Information
Technology; Changsha Gree was listed in the sixth batch of "Electricity Demand Side Management
Demonstration Enterprise" in the industrial field by the Ministry of Industry and Information Technology in 2021.
Its plant-level IEMS system solution, which integrates PV, energy storage and energy management, enables a
significant reduction in plant energy consumption and is a successful practice of the Energy Internet Factory. Gree
Energy Environment Technology Co., Ltd was awarded "2021 Best Energy Storage Technology Innovation Award
of China Energy Storage Industry" by China International Energy Storage Conference and "2021 Best Energy
Storage Frequency Modulation Auxiliary Service Project" by EESA.
(4) New energy vehicle and lithium battery sector
With the long-term in-depth layout of the new energy sector, and in the context of accelerating the realization
"double carbon" goals, Gree further perfected the layout of new energy industry by acquiring Gree Altairnano in
2021, thus adding lithium-ion batteries, new energy commercial vehicles, special vehicles and other business
fields, and build an integrated industry chain covering lithium battery materials, lithium batteries, modules/PACK,
new energy vehicle core components and downstream new energy vehicles, industrial and commercial energy
storage, photovoltaic (storage) air conditioning and energy internet system. The combination of Gree Altairnano’s
core technologies such as battery and Gree’s multi-dimensional low-carbon technologies such as "Zero Carbon
Source" is conducive to increasing the speed of green change in production and lifestyle and gives full play to the
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overall resource advantages. At present, the business relationship between Gree and Gree Altairnano has been
rationalized and initial results have been achieved, including cooperation in the development of a number of
energy storage system projects in high-altitude and ultra-low temperature areas, the introduction of each other's
advantageous products, etc., and will continue to promote comprehensive integration and synergistic development
in the future.
Gree Altairnano has always been attaching great importance to the research and development and
accumulation of technology. As of 2021, the company has applied for 3,316 patents, of which 2,211 patents were
granted, covering lithium battery materials, electric vehicle powertrain, intelligent energy storage and other fields.
New energy vehicle business
Gree Altairnano’s new energy vehicle business covers a full range of products including buses, road buses,
airport ferries, urban sanitation vehicles, logistics vehicles, cold chain vehicles, mining heavy trucks, nucleic acid
testing vehicles, forklifts, etc., which have been operating in more than 220 cities in China, including Beijing,
Wuhan, Changsha, Qingdao, Hangzhou, Harbin and Haikou.
Gree Altairnano’s commercial vehicle series products, including the only 18-meter dolphin bus in the new
energy vehicle industry that won the China Gold Award for appearance design, the first double-decker bus that
became the CCTV live broadcast vehicle after the official opening of the Hong Kong-Zhuhai-Macao Bridge, and
the microbus model that boosted the development of urban-rural integration. In 2021, as a new carrier of red
culture to celebrate the centenary of the founding of the CPC, the antique lam lam bus and the opera face road bus
entered into Xiong’an New Area. Up to now, more than 8,000 buses equipped with Gree Altairnano batteries are
in continuous operation in Beijing. As the only new energy bus supplier of Beijing's busiest bus line "Da 1 Road"
via Chang'an Street and Tiananmen Square, in the past 7 years of operation of the Gree Altairnano buses, battery
safety problems have never occurred, and the power decay rate is less than 5%, and the battery capacity retention
rate is still more than 95%, which successfully solved the problem that new energy buses equipped with
traditional lithium battery packs faced that battery decay is so serious that all-day operation cannot be realized and
the cost of battery replacement needs to be increased.
Gree Altairnano’s logistics vehicle series products, has served in Guizhou logistics park and other places to
provide distribution services for agricultural and sideline products, fresh food, household appliances, etc.; in 2021,
Gree Altairnano was committed to developing a new generation of micro truck logistics vehicles, providing an
effective solution for the problem that small trucks have a small carrying capacity and large trucks are restricted.
Gree Altairnano’s electric sanitation vehicle series products that are committed to creating efficient urban
cleaning solution swith electric, intelligent, networked as the core, have served in Wuhan, Luoyang, Linyi and
other places. In 2021, Gree Altairnano’s pure electric multi-functional dust suppression vehicle was awarded the
title of "China Commercial Vehicle Excellence Product Award".
In 2021, Gree Altairnano’s Airport Ferry received the "Aviation Ground Equipment Inspection Certificate"
issued by the National Construction Machinery Quality Supervision and Inspection Center, becoming a special
vehicle for civil airports certified by the testing agency designated by the Civil Aviation Administration of China.
At present, Gree Altairnano’s new energy vehicles have been operating in Beijing Capital International Airport
and Daxing International Airport, Hangzhou Xiaoshan International Airport and so on, providing safe, fast and
economic services for airport passenger transportation.
Lithium battery business
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The safety of Gree Altairnano’s batteries has been leading the industry for a long time, with the
characteristics of high safety, large rate, fast charging and discharging, wide temperature range, long life, etc. In
2021, the lithium titanate battery developed by Gree Altairnano was jointly selected by the Ministry of Industry
and Information Technology and the China Federation of Industrial Economics as the "National Manufacturing
Single Champion Product".
The company always puts battery safety first, and the developed lithium titanate battery has higher safety
performance than conventional lithium-ion batteries: ① The nano-level lithium titanate material has higher
potential to lithium, which fundamentally eliminates the generation of lithium dendrites and reduces the risk of
internal short circuit; almost no SEI film is generated due to the low reaction activity between lithium titanate and
electrolyte, and low thermal reaction start temperature and high reaction activation energy significantly improve
the stability and safety of the battery; ②The company's lithium titanate battery adopts innovative structural
design such as three-dimensional multi-channel fluid collection and self-constrained poles, which makes the
lithium titanate battery present excellent safety and reliability. In addition to having passed the national mandatory
safety inspection standards for power batteries, the company's lithium titanate batteries have not been subjected to
thermal runaway phenomena such as smoke, fire and explosion under destructive testing conditions such as fire,
nail pricking in water, chainsaw cutting and electric drill impact.
Except that, lithium titanate battery has the advantages of fast charging speed (up to 50℃ continuous
charging and discharging, supporting 70℃ pulse charging and discharging), excellent low temperature
performance (with the ability to charge and discharge in the temperature range of -50~60℃), and long cycle life
(can be used more than 40,000 cycles). The long cycle life of Gree Altairnano batteries can effectively alleviate
the ecological crisis brought by the "retirement wave" of new energy vehicle batteries.Taking a new energy
vehicle life as 10 years, if the power battery is recycled after the vehicle ends its life, the Gree Altairnano battery
can also be used in major energy storage fields in a gradual manner.
Gree Altairnano's lithium titanate battery has achieved good results in the market by virtue of its superior
performance, with representative projects including: ① provided batteries and integrated battery management
system services for electric vehicles of global famous transportation companies and port machinery companies,
which are used in AGV intelligent equipment manufacturing enterprises, rail transportation equipment, automated
port terminals and other fields in Denmark, Switzerland, Czech Republic, Finland and other major countries
around the world. ② the company has obtained large power battery export orders for light electric vehicles in
India, creating a new industry of high-end light electric vehicle products in the Asia-Pacific region; ③ provided
lithium titanate products for new application scenarios such as mobile energy storage on the power generation side
in Europe, large rate industrial energy storage for hydroelectric power generation and fast-charging public
transportation in the United Arab Emirates, with broad market prospects in the future.
Energy storage business
The "Research and Application of Key Technologies of High Safety and Large Energy Storage Systems"
project, which is independently developed and implemented by Gree Altairnano, has reached the "world leading"
level and has significant economic and social benefits, as assessed by authoritative institutions. Recently, the
project was awarded the 2021 Guangdong Science and Technology Progress Award and the First Prize of
Guangdong Machinery Industry Science and Technology Award, Gree Altairnano energy storage technology’s
another recognition by the authority.
Gree Altairnano battery energy storage system has expanded many projects by virtue of its high safety, low
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temperature resistance, large rate, long life and so on, and has made significant breakthroughs in the market, with
benchmark projects including: ① successfully applied to the national photovoltaic and energy storage
demonstration experimental platform (Daqing base), which is the first photovoltaic energy storage demonstration
experimental platform in China, promoting industrial technology progress, transformation of achievements and
industrial development; ② ultra-low temperature regional power plant frequency regulation project: jointly
participated in frequency regulation auxiliary services in coordination with thermal power generating units for
Urad power plant in Inner Mongolia, improved the frequency regulation capacity in the power generation side and
promoted the safe and stable operation of the power grid; ③ high altitude ultra-low temperature regional
communications base station project: landed communications base station energy storage system in Sichuan Aba
prefecture and other areas and provide a strong guarantee for the safe work and communications smoothness of
communications base stations with high security, long life, low temperature resistance and other properties; ④
Gas station "photovoltaic storage" project: built photovoltaic storage integrated energy gas stations together with
Qinghai Province gas stations, which provided a strong guarantee for the safety of photovoltaic storage in
ultra-low temperature areas, and provided a green solution for the comprehensive energy transformation of gas
stations.
In 2021, Gree Altairnano won the awards of "Best Energy Storage Battery Supplier in China Industry" and
"Best Integrated Photovoltaic (storage) and Charging Solution in China Energy Storage Industry" from China
International Energy Storage Conference.
(5) Renewable resources sector
Gree Electric Appliances actively practices the producer responsibility extension system and innovatively
proposes the circular development model of "green design-green manufacturing-green recycling" to ensure the
green efficiency of the whole industrial chain. Starting from 2010, Gree Electric Appliances has established six
recycling bases that mainly engage in the recycling of waste electrical and electronic products and end-of-life
vehicles, as well as the intensive processing of waste circuit boards and waste plastics, in Changsha, Zhengzhou,
Shijiazhuang, Wuhu, Tianjin and Zhuhai. Through nearly ten years of rapid development, it has become a leading
enterprise in the industry, and now has the qualification capacity of dismantling 13 million units of used
household appliances, 94,000 vehicles, 180,000 tons of recycled plastic processing capacity, and 60,000 tons of
waste circuit board processing qualification capacity. 6.5 million sets of used household appliances were
processed in 2021.
By the end of 2021, Gree Recycling Resources Company has processed more than 40 million units (sets) of
various types of waste electrical and electronic products and more than 70,000 tons of end-of-life vehicles, and
has transformed more than 600,000 tons of recycled copper, iron, aluminum and plastic. According to the relevant
estimates, through Gree’s resource regeneration, extraction of crude oil resources was reduced by approximately
1.6 million tons, water was saved by approximately 3.9 million cubic meters, carbon emission was reduced by
approximately 2 million tons, which boosts the realization of carbon peak and carbon neutrality goal.
Since its establishment, Gree Recycling Resources Company has been awarded the titles of "The First Pilot
Unit of Extended Producer Responsibility for Electrical and Electronic Products", " 2025 China Manufacturing
Green Integrated System Pilot Unit", "Green Factory" and "2020 Green Manufacturing System Solution Provider
" by the Ministry of Industry and Information Technology, and has participated in many national major R&D
projects such as the National High Technology Research and Development Program (863 Program) and the
"Major Solid Waste Special Project of the Ministry of Science and Technology".
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(6) Semiconductor sector
Gree Electric Appliances has made significant progress in semiconductor research. In 2021, Gree's
wholly-owned subsidiary Edgeless Integrated Circuit Co., Ltd. achieved over 50% growth in revenue and
shipments of products exceeded 70 million units. Edgeless Integrated Circuit Co., Ltd. has been awarded
"National High-tech Enterprise", "Key IC Design Enterprise Encouraged by the State", "Zhuhai Science and
Technology Small and Medium-sized Enterprise", etc., and relevant products have been evaluated as "Guangdong
High-tech Product", "Zhuhai Innovative Product", "16th 'China Core' Excellent Product", etc. Gree Electric
Appliances and its subsidiaries have applied for a total of 719 semiconductor-related patents, including 292
domestic patents and 71 international patents, and won the 22nd China Patent Excellence Award.
Gree's semiconductor products mainly include industrial-grade 32-bit series MCUs, AIoT SoCs and power
semiconductors. Among them, the 32-bit MCU series have the advantages of high performance, high reliability,
low power consumption, low cost, etc. and have achieved batch application in series of products such as home air
conditioners, commercial VRF units, bus controllers, remote controls, etc., with the annual consumption over ten
million; it can be widely used in consumer electronics, wearable devices, home products, health care support,
commercial large units, industrial sensing, high-performance motor control, etc.
Gree Smart Home series chip (AIoT SoC) combines high performance AI computing power and embedded
MCU, and provides intelligent control for image recognition, human-computer interaction, motor drive, security
encryption, etc. It has been applied in smart air conditioners and smart household appliances, and is provided with
complete software and hardware solutions; it can be widely used in smart home, end-side AIot, smart home,
industrial computing, industrial automation and other fields. As for power semiconductors, the development and
mass production of IGBT, IPM and other series of products have been completed, which have been applied in
batch on inverter air conditioners; they can be widely used in household appliances, intelligent equipment, new
energy and other fields.
(7) Health care sector
Established in 2020, Gree Chengdu Xin Hui Medical Equipment Co., Ltd is a holding subsidiary of Gree
Electric Appliances, that mainly engages in the research and development, production, sales, technical service and
technical consultation of medical equipment and laboratory equipment.
In 2021, Gree Chengdu Xin Hui Medical Equipment Co., Ltd., in response to the severe anti-epidemic
situation at home and abroad, actively upgraded the mobile P2+ nucleic acid testing vehicle, which is upgraded to
4th generation so far. The product adopts the fresh air conditioning system independently developed by Gree,
which meets relevant standard requirements of PCR nucleic acid testing laboratory and secondary biosafety
laboratory. The daily testing volume is up to 20,000-60,000 (10/1 mixed sampling), and test result reports can be
issued in 3 hours on average, which effectively relieves the pressure of nucleic acid testing at the outbreak site.
Gree mobile P2+ nucleic acid testing vehicle has been used in the epidemic prevention and control work in
Shanghai, Hong Kong, Guangdong, Anhui, Hunan, Henan, Hebei, Shandong, Shanxi and Sichuan, etc. In 2021,
Gree Chengdu Xin Hui Medical Equipment Co., Ltd. was awarded the title of "Advanced Group in Combating the
COVID-19 Epidemic".
(V) Strengthen e-commerce operations and activate channel advantages
Gree's "New Retail" is based on 27 sales companies, more than 70 online dealer stores, more than 30,000
offline stores and official flagship stores on third-party e-commerce platforms, and a two-line sales network
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
covering the whole country is established. Digital management from procurement, production, stocking,
warehousing, logistics, inventory, sales is achieved through the use of big data, artificial intelligence and other
advanced technology; reduce sales links, reduce the cost of sales, reshape the Gree ecological structure and
ecosystem through the upgrade and transformation of the production, distribution and sales process of goods, thus
achieving a new model of online service, offline experience and deep integration of retail.
Social e-commerce is growing rapidly and live-streaming e-commerce is becoming mainstream. In 2021,
"Gree Dong Mingzhu's Store" live-streaming e-commerce ushered in the explosive development, and
live-streaming internet celebrity matrix with "Miss Dong" "Yu Tong" as the representative is formed hereafter. In
addition, holding live-streaming events with CCTV expanded new media publicity channels, enriched the product
lines of various categories of household appliances, and comprehensively laid out new energy-efficient products,
and Gree's online sales have achieved rapid growth. In 2021, Gree Electric Appliances fan and air water heater
sales boomed, and sales of new household appliances growed rapidly.
In 2021, "Gree Dong Mingzhu's Store" was transformed into an open platform, and its brands, product
categories and business models were diversified by the means of investment promotion and multi-channel
cooperation, which also drove the sales to grow. The platform showed a new development pattern of win-win
cooperation.
Supply chain management and sales support. In 2021, the supply chain of Gree E-Commerce Company has
formed a warehouse network layout covering the whole country, with products of all categories stocked in the
whole network and orders automatically flowing to the nearest warehouse for delivery, which shortens the
delivery time to the maximum extent; at the same time, it promoted the digital transformation of the order
management process, established a unified intelligent customer service platform, strengthened business risk
monitoring, identifies and handled business abnormalities in advance, and improved the level of financial
informationization and risk prevention. This series of measures effectively guaranteed the implementation of
Gree's new retail model.
Gree's new retail will adhere to digital operation thinking to empower brand expansion; create an efficient
and agile supply chain management system to realize make-to-order and gradually achieve the zero inventory goal;
optimize and upgrade the intelligent customer service platform to improve customer satisfaction; and channel the
flow from online to offline to make the channel burst out more powerful sales energy.
(VI) Improve the competitiveness of export products and vigorously develop independent brands
In 2021, the global economy continued to recover thanks to the expansion of vaccination coverage for
COVID-19, enhanced outbreak prevention and control measures, and continued fiscal stimulus and monetary
easing. Gree Electric Appliances continued to develop in overseas markets and made an eye-catching performance
in emerging markets. In 2021, Gree products were sold to more than 180 countries and regions, of which 51%
were independent brands, with sales increasing by 23% year-on-year.
In 2021, Gree won a number of large model projects, such as the 2022 Qatar World Cup Stadium and its
dormitory supporting projects, Indonesia's Samanea Commercial Complex, the Link Group's Hong Kong
Shopping Center, Brazil's The Mall of St Paul, etc. The winning products covered centrifugal units, screw units
and other large commercial products, blossoming in public facilities, industrial parks, commercial buildings and
other fields, which established Gree's brand international image.
Green development with leading technology as a driving force. Under the double carbon goals, Gree actively
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
developed low carbon technologies, products and solutions, and practiced the global comprehensive
carbon-neutral action. In the commercial air conditioner field, Gree launched energy-efficient and environmentally
friendly water heaters for the European market, as well as ultra-low temperature heat pump products and all DC
inverter condensing units for the North American market to meet the diversified needs of overseas consumers. In
the residential air conditioner field, Gree developed localized products to meet different consumer needs, such as
the Middle East high-temperature resistant air conditioners loaded with Gree's unique G-Boost compressor
technology, healthy air conditioners with multi-faceted cleanliness from the inside out, and intelligent products
that integrate AI energy-saving technology and intelligent dehumidification.
Actively develop online marketing and gradually resume offline promotion. Under the context that offline
activities could not be fully carried out due to the impact of the epidemic, in 2021, the company increased the
operation of overseas online social media to disseminate the Gree brand concept through multiple channels; and
accelerated the construction of overseas e-commerce team to develop sales through e-commerce channels in
several regions. With the increasing rate of vaccination and the gradual recovery of political and economic
activities in overseas markets, the company has gradually resumed participation in offline exhibitions, such as the
West Africa Refrigeration Exhibition, Taipei Electrical and Air Conditioning 3C AV Exhibition, GREENBUILD
Exhibition in the United States, China Consumer Products (Russia) Brand Exhibition, and the 130th Canton Fair.
Adhering to the user-centered, enhance market service awareness. In 2021, the company launched Gree
global technical support service system that provides one-stop service for product solutions and design of
engineering projects; upgraded after-sales technical service, built Gree global after-sales service center website,
established Gree English website with brand as the core, all of which increased Gree’s brand international
awareness.
(VII) Building the Internet of Everything, Leading Smart and Healthy Life
In 2021, Gree Smart Home insisted on independent innovation, independent research and development,
independent manufacturing, and built a zero-carbon healthy home using core technologies. On the basis of
continuously upgrading the five intelligent living systems of whole-house energy, air, health, security and light,
Gree developed personalized spatial intelligent solutions for different living spaces such as home living rooms,
bedrooms and kitchens, creating a green, efficient, convenient and safe home everything connected space.
In terms of intelligent products, in 2021, Gree Electric Appliances launched a new set of household
appliances such as "Gree Mingzhu", with multi-scenario (kitchen, bedroom, living room, bathroom, etc.) and
multi-dimensional (pace, equipment and time) intelligent scenario management functions, creating an overall
solution for intelligent life for consumers; meanwhile, Gree also a variety of intelligent products for different
specific application scenarios: in smart living room scenario, it launched the "Painting Series" wall-mounted air
conditioner that integrates intelligent home central control, audio and video entertainment, air conditioning and
artistic painting screen; intelligent cleaning, it launched the new Ground Gravity sweeper robot equipped with
built-in new generation LDS LIDAR navigation, DM mopping-specific algorithm and self-developed control
system; in intelligent security, it launched the GREE P2 Bluetooth fingerprint door lock, which is equipped with
the highest security level C-class lock core certified by the Ministry of Public Security, and high-precision
fingerprint recognition module; in intelligent health products, it launched the new formaldehyde air conditioner,
two-way fresh air conditioner and formaldehyde air purifier; in intelligent control, it launched the second 5G cell
phone independently developed by Gree, equipped with the independently developed Halo UI 6.0 operating
system, linkable to Gree smart home devices. The launch of Gree series of intelligent health products creates a
high quality of life for consumers.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
In terms of intelligent health technology, Gree has achieved breakthroughs in AI comfort and energy saving
algorithm (G-Learning) and sleep detection technology. G-Learning energy-saving algorithm research uses Gree's
own AI chip and it can actively optimize air conditioner operation control parameters according to room size,
environmental changes and other factors, which has been proven to achieve a comprehensive energy saving of
15%. This study was awarded the world's first AI energy efficiency certificate by the international certification
body INTERTEK. Through PVDF piezoelectric sensing technology, Gree sleep detector can detect physiological
electrical signals during sleep across the mattress, achieving non-sensory detection, and through AI intelligent
algorithm, it can realize sleep staging (light sleep period, deep sleep period, REM period) and generate sleep
report, which is conducive to users' health management.
In terms of market promotion, in 2021, the company landed Gree Zero Carbon Healthy Home in Beijing,
Jiangxi, Changsha, Sichuan, Chongqing and other regions, which realized the intelligent emission reduction effect
and created an energy-saving, environmentally friendly, comfortable and healthy smart home through six
technologies, five systems and space deployment; the company landed the overall solution for smart apartments in
Zhuhai, Wuhan and other regions, equipped with intelligent door locks and Gree rental management system that
includes online informationization of check-in and check-out, alarm for abnormal security of residents, remote
control and management of apartment appliances, which reduces the operating cost of apartment property
management and improves the living experience of residents.
According to the "2021 Top 100 Global Smart Home Invention Patents" published by IPRdaily, Gree ranked
second in the world, and its R&D strength in smart homes was once again recognized by professionals.
(VIII) Accelerate the transformation and upgrading of intelligent manufacturing and provide customers
with intelligent factory system solutions
Gree Electric Appliances promoted the construction of comprehensive digitalization, realized the data
operation and platform operation of the whole value chain, focused on the development of big data, artificial
intelligence and industrial applications, built a new ecology of the manufacturing industry, deeply integrated the
new generation of information technology with the industrial system in all aspects, built an industrial Internet
platform, and established a network foundation connecting machines, materials, people, control systems and
information systems in all aspects. Through the comprehensive and deep perception of industrial data, real-time
dynamic transmission and advanced modeling analysis, intelligent decision-making and control were formed,
which drove the intelligent development of the whole enterprise and promoted the transformation of intelligent
manufacturing.
In 2021, with the goal of "1 platform, 1 set of standard architecture and 18 domain systems", the company
developed a new generation of industrial Internet platform by coordinating the Group's IT construction resources
and business control applications and utilizing advanced technologies such as industrial Internet, cloud-native,
artificial intelligence and 5G, serving the digital transformation of the company. At the same time, the company's
precipitation of software development achievements lied the foundation for the company's industrial
interconnection platform and industrial software development. Built Gree's independent and controllable
information system to support the construction of the digital factory, realizing data-driven business, and escorting
the company to improve quality and increase efficiency and development.
Build Gree Smart Factory. In 2021, the company actively built Gaolan Port "Lighthouse" demonstration
smart factory and promoted the upgrade of smart manufacturing technology in the old factory, and the Zhuhai
base was recognized by the Ministry of Industry and Information Technology as a "pilot demonstration of
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
industrial internet platform + green low-carbon solutions". Chongqing base, Hangzhou base and Hefei base were
recognized as provincial "Smart Factory".
Export smart factory system solution. In 2021, Gree's "IoT-based Smart Factory Platform Research and
Industrialization" project was selected in the category of IoT integrated innovation and integration application by
the Ministry of Industry and Information Technology, and the "Industrial Internet Platform for Industry Chain
Collaboration Scenario in Household Appliance Industry" was selected as an industrial Internet benchmark
demonstration project of Guangdong Province. In 2021, the company reached project cooperation with large
enterprises in the electronics, food and electromechanical industries to provide customers with smart factory
system solutions based on intelligent logistics and information technology.
Cultivating industrial applications. The company carried out research and development of industrial
technology software, cultivated high-quality industrial APPs, designed informatization hardware products,
systematically guided enterprises in the industrial chain to accelerate business and equipment to apply cloud and
promote data interoperability and capability synergy among enterprises in the chain.
Construction of 5G network project. The first MEC edge cloud + smart manufacturing end-to-end 5G SA
slicing network based on MEC was built in Gree headquarters park, which realized low latency, bandwidth
guarantee and data security in 5G slicing + MEC network. The project not only met the needs of the company's
own industrial Internet, realized intelligent control, operation optimization and production organization changes,
and promoted enterprise upgrading and transformation, but also the new model of enterprise-wide 5G network
deployment architecture and network construction, operation and maintenance, and management had
cross-industry demonstration and promotion value.
(IX) Optimize talent training mechanism and incentive system to boost the company to develop steadily
To promote the high-quality development, the company built its own training system, constructed a
diversified independent training mechanism, accelerated the construction of Gree Vocational College, and
increased the training of innovative talents in 2021.
Increase the independent training of innovative talents. According to the growth path of technical R&D
personnel, the company set up multi-level and multi-dimensional training programs and courses, implemented the
special technical training in the manufacturing industry, and promoted employees to develop towards specialized
talents in high, precise and sharp fields; the company made full use of the advantages of resources such as
Guangdong technicians, skilled master studios and technician workstations, and selected and cultivated a number
of "high and precise" skill talents through a series of initiatives such as skill training, skill competitions and skill
level assessment; comprehensively deepened and promoted the whole staff learning and development plan and
formulated thematic training programs at all levels. In 2021, the total number of special training sessions at all
levels was over 20,000, with about 1.2 million participants.
Deepen the company's core business support. Closely following the company's new retail marketing model
and around the global sales market support, continuously innovated management, and improved after-sales skills
by combining training and management with skills and service, which effectively supported and promoted the
first-line market service upgrade. In 2021, the company's training closely followed the company's large-scale
engineering sales and services, and completed special training support for significant projects such as metro and
nuclear power with high quality; it carried out online training and technical consultation for overseas customers
remotely, and completed 600 times of technical training in 30 countries in total; organized and carried out the first
certification class for star service engineers, which established service benchmarks; organized and carried out
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
nationwide touring technical training camps, Gree after-sales elite classes, instructor certification and online
special learning activities to improve the professional skills of after-sales personnel. In 2021, the after-sales
service completed 5,200 learning sessions and trained 480,000 people in total.
Strengthening experience inheritance and cultural dissemination. Through the organization and
implementation of learning programs such as micro-classes for management cadres, lecture halls for technology
experts, lecture halls for skilled craftsmen, and lecture halls for internal lecturers, the company realized
comprehensive Gree experience inheritance and Gree culture dissemination. 2021 Organized approximately 90
extraction activities throughout the year, with more than 4,000 participants. Up to now, the company has dug out
and nurtured 200 group-level quality instructors and developed 800 quality courses.
Accelerate the construction of Gree Vocational College. The construction of Gree Vocational College campus
officially started in February 2021 and is scheduled to be completed in July 2022. The college upon completion,
as a special private higher education institution, will face the national major development strategy and the demand
for talents in the Greater Bay Area. With majors docked with strategic emerging industries such as intelligent
equipment, artificial intelligence, and the Internet of Things, the college will be built as a Chinese brand of
enterprise schooling with deep integration of industry and education and international characteristics. Over the
years, Gree has deepened the integration of industry and education, and won the 7th Huang Yanpei Award for
Outstanding Contribution to Vocational Education for its advanced exploration and practice in school-enterprise
cooperation, being the only enterprise unit to win the award.
In 2021, in order to continuously improve employee satisfaction and happiness, the company implemented
the Employee Stock Ownership Plan, allowing employees to share more of the fruits of corporate development;
adjusted the one- and two-day break work system to a two-day break work system, increased more than 20 days of
vacation throughout the year; obtained quality school places in Gree School for non-Zhuhai household registration
of employees' children, which effectively solved the employees' children's schooling problem and further
enhanced employees' happiness and sense of corporate identity.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Revenue and cost
(1) Composition of operating revenue
Unit: Yuan
2021 2020
Year-on-year
Proportion to the Proportion to the
Amount Amount increase/decrease
operating revenue operating revenue
Total operating
187,868,874,892.71 100% 168,199,204,404.53 100% 11.69%
revenue
By industry
Manufacturing
144,840,537,601.90 77.10 130,427,766,473.54 77.54% 11.05%
industry
Other business 43,028,337,290.81 22.90% 37,771,437,930.99 22.46% 13.92%
By product
Air conditioner 131,712,664,218.81 70.11% 115,576,822,921.57 68.71% 13.96%
生活电器 4,881,607,693.72 2.60% 4,521,756,518.81 2.69% 7.96%
工业制品 3,194,552,084.04 1.70% 2,304,816,992.20 1.37% 38.60%
智能装备 857,741,120.95 0.46% 600,778,785.76 0.36% 42.77%
Green energy 2,907,445,769.91 1.55% 1,782,282,335.29 1.06% 63.13%
Other main
1,286,526,714.47 0.68% 5,641,308,919.91 3.35% -77.19%
businesses
Other business 43,028,337,290.81 22.90% 37,771,437,930.99 22.46% 13.92%
By region
Domestic sale-main
122,305,111,567.10 65.10% 110,407,002,220.87 65.64% 10.78%
business
Export sales-main
22,535,426,034.80 12.00% 20,020,764,252.67 11.90% 12.56%
business
Other business 43,028,337,290.81 22.90% 37,771,437,930.99 22.46% 13.92%
(2) Industries, products and regions that account for more than 10% of the company's operating revenue
or operating profit
√ Applicable □ Not applicable
Unit: Yuan
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Increase or Increase or Increase or
decrease in decrease in decrease in gross
Gross operating revenue operating costs profit margin
Operating revenue Operating costs
margin over the same over the same over the same
period of the period of the period of the
previous year previous year previous year
By industry
Manufacturing
144,840,537,601.90 101,021,238,221.75 30.25% 11.05% 14.90% -2.34%
industry
Other business 43,028,337,290.81 41,230,400,368.12 4.18% 13.92% 13.56% 0.31%
By product
Air conditioner 131,712,664,218.81 90,576,252,210.44 31.23% 13.96% 20.14% -3.54%
Other business 43,028,337,290.81 41,230,400,368.12 4.18% 13.92% 13.56% 0.31%
By region
Domestic
sale-main 122,305,111,567.10 80,703,210,957.38 34.01% 10.78% 14.75% -2.29%
business
Export sales-main
22,535,426,034.80 20,318,027,264.37 9.84% 12.56% 15.50% -2.29%
business
Other business 43,028,337,290.81 41,230,400,368.12 4.18% 13.92% 13.56% 0.31%
In case the statistical caliber of the company's main business data is adjusted during the report period, the company's main business
data will be adjusted according to the caliber at the end of the report period in the last year.
□ Applicable √ Not applicable
(3) Whether the company's revenue from physical sales is greater than its revenue from labor services
√ Yes □ No
Description of a year-on-year change of 30% or more in relevant data
□ Applicable √ Not applicable
(4) Performance of significant sales contracts and significant purchase contracts entered into by the
Company as of the report period
□ Applicable √ Not applicable
(5) Composition of operating cost
Unit: Yuan
Industry 2021 2020 Year-on-year
Item
classification Amount Proportion to Amount Proportion to increase/decrea
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
operating cost operating cost se
Raw material 86,226,905,186.28 88.27% 75,879,070,146.39 86.90% 13.64%
Household
Labor costs 4,402,642,502.15 4.51% 4,261,563,030.87 4.88% 3.31%
appliance
Depreciation 1,734,054,331.37 1.78% 1,693,963,131.00 1.94% 2.37%
manufacturing
Energy 708,881,983.14 0.73% 779,821,409.66 0.89% -9.10%
(6) Whether there was a change in the scope of consolidation during the report period
√ Yes □ No
1. Business combinations not under common control
(1) Business combinations not under common control that occurred during the period
Unit: Yuan
Basis for
Name of Operating revenue
Point of Equity Equity determining Net profit from the
the Equity acquisition Acquisition from the
acquisition acquisition acquisition the acquisition date to
Purchased cost date acquisition date to
of equity proportion method acquisition statement date
Party statement date
date
Gree
Altairnano
October 31, Purchase October 31, Acquisition
New 1,828,275,113.56 30.47% 694,344,061.76 -416,767,701.45
2021 in cash 2021 of control
Energy
Inc.
(2) Cost of business combination and goodwill
Unit: Yuan
Cost of business combination Amount
Cost of business combination 1,828,275,113.56
Less: fair value share of the identifiable net assets acquired 1,215,497,529.64
Amount of goodwill/combination cost less than the share of fair value of identifiable net asset 612,777,583.92
acquired
[Note 1] As described in Note 5.23 "Goodwill" to the financial statements, Gree Altairnano New Energy
became a subsidiary held by Company on October 31, 2021.
[Note 2] As of the acquisition date October 31, 2021, the fair value of the identifiable net assets attributable
to the owners of the parent company of Gree Altairnano New Energy was 1,215,497,529.64 yuan, and the fair
value of the corresponding identifiable net assets was appraised by China United Assets Appraisal Group Limited,
which issued appraisal report ZLPBZ [2022] No. 1362.
The formed goodwill on the combination of Gree Altairnano is mainly due to the fact that the fair value share
of the identifiable net assets of Gree Altairnano acquired by the Company on the acquisition date is lower than the
combined cost. The asset valuation on the date of this purchase used the asset-based method, the value of the
future business growth of Gree Altairnano could not be fully reflected due to the limitations of the valuation
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
method itself. At present, the business relationship between Gree Electric Appliances and Gree Altairnano has
been rationalized and preliminary results have been achieved. In the future, the company will continue to promote
comprehensive integration and synergistic development, grasp market and industry development opportunities,
further enhance the comprehensive competitiveness and sustainable development capability of Gree Altairnano
and prevent goodwill impairment risk.
(3) Identifiable assets and liabilities of the acquiree on the acquisition date
Unit: Yuan
Gree Altairnano New Energy Inc.
Item
Fair value on the acquisition date Book value on the acquisition date
Assets:
Monetary funds 1,646,843,953.97 1,646,843,953.97
Trading financial liabilities 10,000.00 10,000.00
Accounts receivable 2,779,548,017.55 2,779,548,017.55
Advance payments 215,800,208.73 215,800,208.73
Other receivables 234,176,292.67 234,176,292.67
Inventory 2,135,766,221.72 2,135,766,221.72
Contract assets 996,806,636.13 996,806,636.13
Non-current assets due within one year 2,810,789.73 2,810,789.73
Other current assets 856,356,937.01 856,356,937.01
Long-term receivables 3,014,657.86 3,014,657.86
Long-term equity investments 390,685,789.09 535,849,709.81
Other equity instruments investments 2,170,000.00 2,170,000.00
Investment real estate 30,434,649.00 6,404,970.97
Fixed assets 9,851,922,127.54 8,874,157,430.70
Construction in progress 2,341,162,945.24 2,301,429,874.64
Intangible assets 3,078,130,531.23 2,103,825,250.26
Long-term unamortized expenses 18,801,886.89 18,801,886.89
Deferred income tax assets 1,906,423,128.64 1,906,423,128.64
Other non-current assets 277,326,714.43 277,326,714.43
Subtotal of assets 26,768,191,487.43 24,897,522,681.71
Liabilities:
Short-term borrowings 2,202,310,244.21 2,202,310,244.21
Notes payable 1,382,825,460.48 1,382,825,460.48
Accounts payable 4,860,305,562.25 4,860,305,562.25
Contract liabilities 5,024,137,616.68 5,024,137,616.68
Employee pay payable 49,442,281.69 49,442,281.69
Taxes and dues payable 46,366,595.59 46,366,595.59
Other payables 4,233,517,352.93 4,233,517,352.93
Non-current liabilities due within one year 98,518,621.44 98,518,621.44
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Other current liabilities 2,088,457,921.70 2,088,457,921.70
Long-term borrowings 850,000,000.00 850,000,000.00
Long-term payables 392,843,262.75 392,843,262.75
Deferred Income 1,186,062,239.50 1,186,062,239.50
Deferred income tax liabilities 13,873,952.69 13,873,952.69
Subtotal of liabilities 22,428,661,111.91 22,428,661,111.91
Net assets 4,339,530,375.52 2,468,861,569.80
Before the acquisition date, affected by the corporate governance problems caused by the alleged
misappropriation of the interests of Gree Altairnano by the former controlling shareholder of Gree Altairnano,
Gree Altairnano was restricted in the financing, resulting in production capacity not being fully unleashed and in a
continuous loss; after the listed company acquired the control of Gree Altairnano on the acquisition date, Gree
Altairnano was managed in strict accordance with relevant laws and regulations and various corporate systems,
and the annual auditing accountant, China Audit Union Power Certified Public Accountants Co., Ltd. (Special
General Partnership), adjusted the accounting policies of Gree Altairnano based on the operating conditions and
prudent considerations and with reference to the standards of listed companies and made corresponding audit
adjustments. The above situation had an impact on the purchase date book value of the net assets of Gree
Altairnano.
Gree is committed to building into a more competitive, diversified, technology-based global industrial group
with a long-term, in-depth layout of the new energy sector. The company's participation in the judicial auction to
acquire Gree Altairnano aims to combine the core technologies of Gree Altairnano batteries with the company's
"zero carbon source" and other multi-dimensional low-carbon technologies to give full play to its overall resource
advantages and further improve new energy industry layout. Up to now, the business relationship between Gree
Electric Appliances and Gree Altairnano has been rationalized and preliminary results have been achieved, and the
number of new energy vehicles being made by Gree Altairnano exceeded the level of the same period in 2020 and
2021; lithium titanate battery achieved good results in overseas and domestic markets with its superior
performance, and the relevant patent has recently been selected for the list of China Patent Award, being the only
lithium battery product in the new energy industry that won the gold medal. The performance and yield of
LiFePO4 products have also been greatly improved, and the production capacity will be unleashed gradually. With
the gradual unleashing of production capacity and the recovery of profitability in the future, Gree Altairnano’s
value will also continue to increase.
(4) Gains or losses arising from the remeasurement of equity held before the purchase date at fair value
Gains or losses on
Book value of equity held
Fair value on the purchase date remeasurement of previously
Name of the Purchased Party before the acquisition date on
of share held before that date held equity interest to fair value
the acquisition date
before the acquisition date
Gree Altairnano New Energy Inc. None None None
(5) Methodology and key assumptions for determining fair value on the acquisition date
1. Valuation determination method: The assets and liabilities were mainly evaluated using the asset-based
method and the income method.
2. Key assumptions in the evaluation process.
A. The appraised entity is capable of making timely adjustments and innovations in line with the
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
development of the market and science and technology, while maintaining consistency in its business scope,
business methods and management mode.
B. Except for the fixed asset investments for which there is definite evidence of changes in production
capacity after the benchmark date of the appraisal, the production capacity of the enterprise's products is estimated
based on the status as of the benchmark date of the appraisal, assuming that the appraised entity will not make any
significant fixed asset investment activities affecting its operation in the future revenue period;
C. Assuming that the appraised entity will maintain a similar turnover of accounts receivable and accounts
payable in the future earnings period as in historical years, and that there will be no default in payment that is
materially different from historical years;
D. The assets and liabilities declared by the appraised entity are free from title disputes and other economic
disputes;
E. The appraised entity's future sources of funding and costs for R&D and production will not have a
material adverse impact on the enterprise.
3. Reasons for asset appreciation：
A. Machinery and equipment: the market price of some equipment increased and the depreciable life of the
enterprise's equipment was shorter than the economic life of the equipment;
B. Housings and buildings: there was a difference between the depreciable life and the actual economic life,
and some buildings were built a long period of time ago, resulting in an increase in replacement costs (labor,
materials, etc.);
C. Land use rights: the time when the enterprise acquired the land is far from the benchmark date of the
evaluation and the price was low, and the land price increased between the acquisition date and the current
valuation benchmark date.
2. Business combination under the same control
No.
3. Reverse purchase
No.
45
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
4. Disposal of subsidiaries
Unit: Yuan
The
differenc
e
between
the Amount
Determin
disposal of other
ation
price and comprehe
methods
the share Propor nsive
Gains or and main
of the tion of Book Fair income
losses assumpti
Equity Equit subsidiar remain value of value of related to
arising ons of
dispos y y's net ing remainin remainin equity
Equity Time point from the fair
al dispo Basis for determining the point assets in equity g equity g equity investmen
Company name disposa of losing remeasure value of
propor sal at which control is lost the on the on the on the t of the
l price control ment of the
tion meth consolida date of date of date of original
remaining remainin
(%) od ted losing losing losing company
equity at g equity
financial control control control transferre
fair value. on the
statement (%) d into
date of
s investmen
losing
correspo t profit
control.
nding to and loss.
the
disposal
investme
nt.
SL Group Jiangwan Rice 255,00 2.00 Sale August, Share Transfer Agreement 215,501. 49.00 1,145,00 1,145,00 Book None
46
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Industry Co., Ltd 0.00 2021 72 0.00 0.00 value
SL Group Lianhe Ecology 21,000. August, -50,939.5 Book
21.00 Sale Share Transfer Agreement 49.00 None
Farm Co., Ltd 00 2021 4 value
SL Group Yuan Agriculture September, Industrial and commercial Book
40.00 Sale 2,291.72 30.00 None
Co., Ltd 2021 change registration value
SL Group Lvzhiyuan September, Industrial and commercial 142,792. Book
40.00 Sale 30.00 None
Agriculture Co., Ltd 2021 change registration 55 value
SL Group Dongwei Rice September, Industrial and commercial 92,134.3 Book
21.00 Sale 30.00 None
Industry Co., Ltd 2021 change registration 2 value
SL(Ningbo) Grain Sales Co., September, Industrial and commercial 23,927.9 Book
100.00 Sale None
Ltd 2021 change registration 1 value
47
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
5. Change of combination scope for other reasons
(1) Newly established entities for the current period
Unit: Yuan
Name Date of Net assets at the end of the Net profit from the combination
establishment period date to the end of the period
Zhuhai Gree Electormechanical Engineering (Linyi) March 1, 2021 36,931,910.01 6,931,910.01
Co., Ltd.
Wuhu Gree Intelligent Logistics Co., Ltd March 19, 2021
Gree (Zhuhai Hengqin) GREE Development Co.,
April 25, 2021 998,450,036.83 -1,549,963.17
Ltd.
Gree Electric Appliances (Linyi) Co., Ltd. May 6, 2021 194,574,519.31 -5,425,480.69
Jiangxi Jinrun Real Estate Co., Ltd June 16, 2021 85,809,836.46 -14,190,163.54
Changsha Kinghome Electrics Co., Ltd July 1, 2021 5,720,175.31 -279,824.69
Green Electricity New Material (Maanshan) September 7,
Technology Co., Ltd. 2021
Wuhan Yuli Runzhu Real Estate Co., Ltd September 26, 6,723,663.82 -276,336.18
2021
Huaxingaodao (Maanshan) Technology Co., Ltd. October 15, 2021
Zhuhai MinRoad Supply Chain Technology Co., November 19,
Ltd 2021
(2) Other decrease for the current period
In August 2021, the company cancelled its subsidiaries, SL Group Ermapao Eco-Farm Co., Ltd. and Handan
YingDong New Energy Technology Co., Ltd.
(7) Major changes or adjustments in the Company's business, products or services during the report period
□ Applicable √ Not applicable
(8)Main sales customers and suppliers
Main sales customers of the Company
Total sales amount of the top five customers (yuan) 30,819,315,606.26
Proportion of total sales amount of 5 top customers to the total annual sales 16.25%
Proportion of sales amount of related party in the sales amount of 5 top customers
0.00%
to the total annual sales
Information of top 5 customers
Serial No. Customer name Amount of sales (yuan) Proportion to total annual sales
1 First 7,995,073,996.04 4.22%
2 Second 6,174,062,804.40 3.26%
48
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
3 Third 5,842,521,938.70 3.08%
4 Fourth 5,698,659,582.61 3.00%
5 Fifth 5,108,997,284.51 2.69%
Total -- 30,819,315,606.26 16.25%
Other description of major customers
□ Applicable √ Not applicable
Main suppliers of the Company
Total purchase amount of the top five suppliers (yuan) 46,390,746,483.63
Proportion of total purchase amount of 5 top customers to the total annual purchase 35.07%
Proportion of related parties' total purchase amount in the amount of purchase of top 5 suppliers
0.00%
to the total amount of annual purchase
Information about top 5 suppliers of the Company
Serial No. Supplier name Amount of purchase (yuan) Proportion to the total annual purchase
1 First 15,446,631,024.26 11.68%
2 Second 8,632,767,550.14 6.53%
3 Third 8,472,142,154.67 6.40%
4 Fourth 7,132,269,860.53 5.39%
5 Fifth 6,706,935,894.03 5.07%
Total -- 46,390,746,483.63 35.07%
Other description of major suppliers
□ Applicable √ Not applicable
3. Expenses
Unit: Yuan
Year-on-year
2021 2020
increase/decrease
Sales expense 11,581,735,617.31 13,043,241,798.27 -11.21%
Administrative expense 4,051,241,003.05 3,603,782,803.64 12.42%
Financial expense -2,260,201,997.18 -1,937,504,660.07 -16.66%
Research and development expenses 6,296,715,941.03 6,052,563,108.10 4.03%
4. R&D investment
√ Applicable □ Not applicable
Name of major Expected impact on the future
Project purpose Project Progress Objectives to be achieved
R&D projects development of the company
49
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Improve the heating
performance and thermal
Improve customer
Continuous heating Achieve defrosting without comfort of air source heat
thermal comfort and Completed, product
high-efficiency hot sudden cooling and pumps, achieve green and
achieve energy-saving is available on the
gas defrosting continuous heating during low-carbon operation, while
and emission-reducing market
technology defrosting improving the quality of life
operation
of customers in winter
heating.
Research and
Develop environmentally Low GWP refrigerant
Application of New
friendly refrigerant application, achieve a variety
Generation Completed, product
products to reduce of functions to improve the Enhance market
Environmentally is available on the
environmental pollution user experience through the competitiveness
Friendly market
and improve product application of a number of
Refrigerant Air
performance technology research.
Duct Machine
Expand the product
category and
Research on key
manufacture a series of Improve the competitiveness
technologies for
new platform washing of Gree washing machine Enhance market
efficient washing Completed
machines with large market and meet the market competitiveness
and drying of
capacity and thin size in demand.
clothes
line with the market
mainstream.
50
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
1. Green and environmental
protection: remove indoor
formaldehyde efficiently, and
continuously decompose
formaldehyde into CO2 and
H2O. 2. Long-lasting
Completed, aldehyde removal: purifier
Research and technology identified products’ formaldehyde CCM
application of high by academicians of exceeds 6 times the highest
Achieve long-lasting Improve product
efficiency room Chinese Academy of level of national standards,
green formaldehyde performance, meet user needs,
temperature Sciences and air extending the life of the filter;
removal and enhance and increase product
catalytic purification industry 3. Energy saving and
user comfort experience. competitiveness.
formaldehyde experts, reaching environmental protection: the
removal purifier "international energy efficiency of the whole
Leading" level machine exceeds 30% of the
national standards of energy
efficiency; 4. Comfortable
and quiet: noise at the highest
gear as low as 63dB. 5.
Technology reached "World
Leading" level
Enhance the company's
Completed R&D of Leading technology, series technological level and
Industrial
Provide new technology standard products products achieve IE5 high market competitiveness in the
permanent magnet
solutions for industrial and realized the energy efficiency, while industrial field through
assisted reluctance
motor efficiency application in the ensuring high cost technological and product
motor R&D
general machinery performance innovation in industrial
motors.
51
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Combined the technologies of
photovoltaic power
generation, energy storage,
and efficient and intelligent
energy consumption for air
conditioners, realized local
consumption of photovoltaic
power, peak-shaving and
Research on the key
Research on the key valley-filling, and off-grid
technology of
technology of PEDF zero Completed operation of the system. The Provide innovative products
PEDF zero-carbon
carbon building application of photovoltaic
building
(storage) air conditioner can
reduce or get rid of the
dependence on the power
grid, and it has excellent
power regulation performance
by double control and double
reduction in terms of energy
consumption and load.
Company R&D personnel
2021 2020 Change Ratio
Number of R&D personnel
14,233 14,458 -1.56%
(persons)
Proportion of number of R&D
17.38% 17.22% 0.16%
personnel
Academic structure of R&D
-- -- --
personnel
Bachelor 8,610 9,310 -7.52%
Master 1,449 1,742 -16.82%
Doctor 34 41 -17.07%
Age composition of R&D
-- -- --
personnel
Below 30 years old 8,855 9,515 -6.94%
30~40 years old 4,345 4,119 5.49%
R&D investment of the Company
2021 2020 Change Ratio
52
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Investment amount in research
6,528,680,941.53 6,213,796,926.90 5.07%
and development (Yuan)
Proportion of investment in
research and development to the 3.48% 3.69% -0.21%
operating revenue
Capitalization amount of
research and development 231,965,000.50 161,233,818.80 43.87%
investment (yuan)
Proportion of capitalized
research and development
3.55% 2.59% 0.96%
investment to research and
development investment
Reasons and influences of significant changes in the composition of R&D personnel in the company
□ Applicable √ Not applicable
Reasons for significant changes in the proportion of total R&D investment to the operating revenue compared with the previous year
□ Applicable √ Not applicable
Reasons for the large change of capitalization rate of R&D investment and its reasonableness
□ Applicable √ Not applicable
5. Cash flow
Unit: Yuan
Item 2021 2020 Year-on-year increase/decrease
Subtotal of cash inflows from
177,201,260,717.00 163,892,764,321.22 8.12%
operating activities
Subtotal of cash outflows from
175,306,897,458.28 144,654,127,012.06 21.19%
operating activities
Net cash flows from operating
1,894,363,258.72 19,238,637,309.16 -90.15%
activities
Subtotal of cash inflows from
55,391,360,332.62 14,155,332,757.58 291.31%
investment activities
Subtotal of cash outflows from
25,639,376,773.27 14,057,602,607.40 82.39%
investment activities
Net cash flows from investment
29,751,983,559.35 97,730,150.18 30,342.99%
activities
Subtotal of cash inflows from
89,991,092,450.05 37,614,461,534.80 139.25%
financing activities
Subtotal of cash outflows from
115,321,676,340.53 58,725,959,033.00 Translation
financing activities
53
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Net cash flow from financing
-25,330,583,890.48 -21,111,497,498.20 19.98% -19.98
activities
Net increase in cash and cash
5,726,694,119.85 -2,147,522,183.34 366.67% Translation
equivalents
Description of the main factors affecting the significant year-on-year change in the relevant data
√ Applicable □ Not applicable
1. Net cash flow from operating activities decreased by 90.15% year-on-year, mainly due to the increase in net increase in cash paid
for goods and services purchased and loans and advances from customers.
2. Net cash flow from investing activities increased by 30,342.99% year-on-year, mainly due to the increase in other cash received in
connection with investing activities.
Reasons for significant differences between net cash flow from operating activities and net profit for the year during the report period
□ Applicable √ Not applicable
V. Analysis of non-main business
□ Applicable √ Not applicable
VI. Analysis of Assets and Liabilities
1. Significant changes in the composition of assets
Unit: Yuan
At the end of 2021 At the beginning of 2021 Proportion
Proportion to total Proportion to total increase or
Amount Amount
assets assets decrease
Monetary funds 116,939,298,776.87 36.59% 136,413,143,859.81 48.85% -12.26%
Accounts receivable 13,840,898,802.76 4.33% 8,738,230,905.44 3.13% 1.20%
Contract assets 1,151,228,472.63 0.36% 78,545,525.60 0.03% 0.33%
Inventory 42,765,598,328.01 13.38% 27,879,505,159.39 9.98% 3.40%
Investment real estate 454,854,822.63 0.14% 463,420,861.39 0.17% -0.03%
Long-term equity
10,337,008,014.57 3.23% 8,119,841,062.14 2.91% 0.32%
investments
Fixed assets 31,188,726,142.99 9.76% 18,990,525,087.94 6.80% 2.96%
Construction in progress 6,481,236,333.38 2.03% 4,016,082,730.07 1.44% 0.59%
Usufruct assets 14,603,282.99 0.00% 38,952,103.28 0.01% -0.01%
Short-term borrowings 27,617,920,548.11 8.64% 20,304,384,742.34 7.27% 1.37%
Contract liabilities 15,505,499,178.75 4.85% 11,678,180,424.65 4.18% 0.67%
Long-term borrowings 8,960,864,258.30 2.80% 1,860,713,816.09 0.67% 2.13%
Lease liabilities 3,313,452.52 0.00% 9,410,352.55 0.00% 0.00%
54
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Overseas assets account for a relatively high proportion.
□ Applicable √ Not applicable
55
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Assets and liabilities measured at fair value
√ Applicable □ Not applicable
Unit: Yuan
Gains or losses on Impairment
Amount at the Accumulated fair
changes in fair value accrued for Purchase amount for Selling amount for Other Amount at the end of
Item beginning of the value changes
for the current the current the current period the current period changes the period
period included in equity
period period
Financial liabilities
1. Trading financial liabilities
370,820,500.00 631,554.78 660,611,937.82 1,032,063,992.60
(excluding derivative financial assets)
2. Derivative financial liabilities 285,494,153.96 -86,720,955.31 198,773,198.65
3. Other debt investments 502,202,293.17 9,239,147.26 14,006,555.87 5,210,000,000.00 5,910,056,891.62
4. Other equity instruments investments 7,788,405,891.47 2,389,207,456.95 5,328,875,076.08 41,680,735.20 85,167,806.45 10,114,246,030.05
5. Receivable financing 20,973,404,595.49 -10,935,725.15 -82,636,245.91 4,649,587,822.73 25,612,056,693.07
6. Other non-current financial liabilities 2,003,483,333.33 -3,174,005.94 81,000,000.00 2,000,000,000.00 81,309,327.39
7. Others 44,822,900.00 -447,304.28 30,939,495.72 12,160,000,000.00 12,376,325,374.41
Subtotal of financial liabilities 31,968,633,667.42 2,297,800,168.31 5,291,184,881.76 22,802,880,495.75 3,117,231,799.05 54,292,767,515.19
Total above 31,968,633,667.42 2,297,800,168.31 5,291,184,881.76 22,802,880,495.75 3,117,231,799.05 54,292,767,515.19
Financial liabilities
Other changes
None
Whether there were any significant changes in the measurement attributes of the Company's major assets during the report period
□ Yes √ No
56
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
3. Restricted rights to assets as of the end of the report period
Unit: Yuan
Item Book value at the end of the period Restricted reason
Statutory deposit reserve and
Monetary funds 37,328,823,349.13
deposits
Accounts receivable 276,321,025.79 Pledged
Receivable financing 12,911,461,792.08 Pledged
Contract assets 422,560,112.06 Pledged
Other current assets 6,800,000,000.00 Pledged
Non-current assets due within one
60,197,639.98 Pledged
year
Other debt investments 4,717,527,970.00 Pledged
Other equity instruments
8,938,973,543.22 Restricted shares
investments
Long-term equity investments 312,711,807.79 Pledged
Fixed assets 847,908,771.37 Pledged
Construction in progress 225,701,846.53 Pledged
Intangible assets 947,343,396.76 Pledged
Other non-current assets 44,163,315.00 Pledged
Total 73,833,694,569.71
VII. Analysis of investments
1. Overall review
√ Applicable □ Not applicable
Investment in the same period last
Investment in the report period(yuan) Change percentage
year(yuan)
18,154,432,702.74 3,561,055,956.90 409.80%
57
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Major equity investments obtained during the report period
√ Applicable □ Not applicable
Unit: Yuan
Progress as Profit and loss
Name of Whether it is
Main Investment Investment Shareholding Capital Investment of the Expected on investments Disclosure Disclosure
investee Partner Product type involved in a
business mode amount proportion source term balance sheet revenue for the current date (if any) Index (if any)
company lawsuit
date period
Research and
development
of new
Gree Electric
energy New energy
Appliances:
technology, vehicles,
Gree Announcement
production lithium-ion
Altairnano August 31, of Foreign
and sales of Acquisition 1,828,275,113.56 30.47% Own funds None Long term batteries, Completed - -126,989,002.82 No
New Energy 2021 Investment
lithium-ion energy
Inc. and Related
power storage
Transactions
batteries and products, etc.
(2021-060)
energy
storage
batteries
Total -- -- 1,828,275,113.56 -- -- -- -- -- -- -- -126,989,002.82 -- -- --
3. Significant non-equity investments in progress during the report period
□ Applicable √ Not applicable
58
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
4. Financial Assets Investments
(1) Securities investment
√ Applicable □ Not applicable
Unit: Yuan
Gains or losses on
Accounting Book value at the Accumulated fair Purchase Selling amount Profit/loss
Type of Securities Securities Initial investment changes in fair Book value at the Accounting Capital
measurement beginning of the value changes amount for the for the current during the
securities code abbreviation cost value for the end of the period Accounts source
model period included in equity current period period report period
current period
Stocks
listed on
domestic Other equity
Measured at Own
and 600745 WINGTECH 884,999,996.60 3,550,040,505.00 1,086,527,548.50 3,751,568,056.90 5,916,734.18 4,636,568,053.50 instruments
fair value funds
overseas investments
stock
exchanges
Stocks
listed on
domestic Other equity
San'an Measured at Own
and 600703 2,000,000,000.00 3,093,928,974.37 1,208,476,515.35 2,302,405,489.72 17,182,130.55 4,302,405,489.72 instruments
Optoelectronics fair value funds
overseas investments
stock
exchanges
59
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Stocks
listed on
domestic Other equity
Measured at Own
and 600619 Highly 1,141,510,131.07 667,802,216.81 88,370,312.43 -386,430,427.61 14,411,825.47 755,079,703.46 instruments
fair value funds
overseas investments
stock
exchanges
16.
Measured at Other debt Own
Bonds 160017 Interest-bearing 288,405,500.00 298,866,682.20 4,883,141.17 7,448,985.41 14,301,000.00 304,947,682.20
fair value investments funds
treasuries 17
Stocks
listed on
domestic Other equity
Xinjiang Measured at Own
and 600888 111,836,005.99 215,172,336.36 45,737,682.63 105,586,941.75 41,680,735.20 85,167,806.45 3,918,701.49 217,422,947.74 instruments
Joinworld fair value funds
overseas investments
stock
exchanges
Measured at Other debt Own
Bonds 200408 20 Nongfa 08 199,203,000.00 203,335,610.97 3,416,815.03 5,618,379.40 10,476,600.00 206,912,210.97
fair value investments funds
21 Huafa Group Measured at Other debt Own
Bonds 102101215 200,000,000.00 812,000.00 812,000.00 200,000,000.00 5,474,739.71 205,576,657.52
MTN007 fair value investments funds
Stocks
listed on
domestic RS Other equity
Measured at Own
and 01528 MACALLINE- 640,024,820.31 254,461,858.93 -39,904,601.96 -444,254,984.68 195,769,835.63 instruments
fair value funds
overseas H SHS investments
stock
exchanges
60
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Ronghui Single
Trading
Asset Measured at Own
Others - 81,000,000.00 309,327.39 81,000,000.00 309,327.39 81,309,327.39 financial
Management fair value funds
liabilities
Plan
19 Huafa Group Measured at Other debt Own
Bonds 101901653 59,587,700.00 445,070.72 445,070.72 60,000,000.00 2,287,646.15 60,392,960.52
MTN007 fair value investments funds
Other investment securities held at the
9,996,590.00 -- 127,191.06 127,191.06 10,000,000.00 391,349.87 10,155,063.15 -- --
end of the period
10,976,539,931.8
Total 5,616,563,743.97 -- 8,283,608,184.64 2,399,201,002.32 5,343,326,702.67 392,680,735.20 85,167,806.45 74,670,054.81 -- --
0
Securities Investment Approval Board
April 29, 2021
Announcement Disclosure Date
Date of disclosure of announcement of
shareholders' meeting for approval of June 30, 2021
securities investment (if any)
(2)Investment in derivatives
√ Applicable □ Not applicable
Unit: 10,000 yuan
61
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Proportion of
Initial the ending Profits and
Operation Investment Amount Amount of
Whether Types of investment Amount sold Ending investment losses
name of Related amount at the purchased provision for
related Derivatives amount of Start date Expiry date during the investment amount to net during the
investment in relationships beginning of during the impairment (if
transactions Investments derivative report period amount assets at the report
derivative the period report period any)
investment end of the period
report period
Futures Futures hedging January 1, December 31,
Unrelated party No 4,482.29 4,482.29 4,393.05 0.04% 17,333.51
company contracts 2021 2021
Forward
Financial January 1, December 31,
Unrelated party No financial 28,549.42 28,549.42 19,877.32 0.19% 26,089.69
institution 2021 2021
contracts
Total 33,031.71 -- -- 33,031.71 24,270.37 0.23% 43,423.20
Derivatives investment funding sources Own funds
Involvement in lawsuits (if applicable) None
Date of Disclosure of Announcement of Board for Approval of
April 29, 2021
Derivatives Investment (if any)
Date of Disclosure of Announcement of Shareholders' Meeting
July 1, 2021
for Approval of Derivative Investment (if any)
62
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
I. Risk Analysis
1. Market risk: The exchange rate fluctuations in both directions increased significantly, and there was a possibility that the exchange rate of forward and
option contracts might differ from the actual exchange rate on the maturity date, which might result in losses. The Company entered into forward and option
contracts based on the real import and export trade background and reasonable estimation of future foreign exchange revenue and expenditure, and managed
the exchange rate risk of the Company's import and export business and foreign exchange position with the idea of "risk-neutral" and the principle of
cost-profit.
2. Default risk: The company entered into the above foreign exchange fund transaction contracts based on the real import and export trade background and
reasonable estimation of future foreign exchange revenue and expenditure, and there was no performance risk; the company chose commercial banks with
Risk analysis and description of control measures for derivative good creditworthiness for its foreign exchange contracts, and basically did not need to consider the risk of default caused by their failure.
positions during the report period (including but not limited to 3. Liquidity risk: All foreign exchange fund transactions met the requirements of trade authenticity, and the relevant foreign exchange fund transactions would
market risk, liquidity risk, credit risk, operational risk, legal risk, be operated by means of bank credit, which would not affect the liquidity of the company.
etc.) II. Risk Management Measures
1. Based on the basic situation of foreign exchange derivatives trading business approved by the Board of Directors, the fund operation and management
center proposed a reasonable assessment and concrete implementation plan based on the real trade background and reasonable estimation of future foreign
exchange revenue and expenditure and business needs.
2. Each foreign exchange derivative trading business is subject to a three-tier approval system, i.e. the approval of the head of foreign exchange business of the
fund operation and management center, the head of the fund operation and management center and the Finance Chief of the company is required before
implementation.
3. The fund operation management center paid attention to the risk factors of foreign exchange derivatives trading business in real time, and made timely
warning and response plan when the market fluctuation caused a large impact.
Changes in the market price or fair value of the product during
the report period of the invested derivatives, and the analysis of
The gains or losses of futures hedging contracts for the report period was 173,335,100 yuan, and the gains or losses of forward financial contracts for the
the fair value of the derivatives should disclose the specific
report period was 189,945,200.
methodology used and the setting of relevant assumptions and
parameters
63
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Description of whether there has been any significant change in
the accounting policy and specific accounting principles for
No change
derivatives during the report period as compared to the previous
report period
The independent directors of the Company are of the view that the Company's hedging business of futures on bulk materials is conducive to locking in
production costs, controlling operation risks and improving operation management; through foreign exchange derivatives trading business, it is conducive to
Special Opinion of Independent Directors on the Company's
further enhancing the Company's foreign exchange risk management capability and realizing the value preservation and appreciation of foreign exchange
Derivatives Investment and Risk Control
assets. The Company has established a corresponding control system for the relevant business, and the approval and implementation are legal and compliant,
and the risks are controllable, which is in the interests of the Company and all shareholders.
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5. Use of proceeds
□ Applicable √ Not applicable
The Company has no use of proceeds during the report period.
XIII. Major assets and equity sales
1. Sale of Major Assets
□ Applicable √ Not applicable
The Company did not sell any major assets during the report period.
2. Sale of significant equity interests
□ Applicable √ Not applicable
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IX. Analysis of major controlled and invested companies
√ Applicable □ Not applicable
Major subsidiaries and participating companies affecting 10% or more of the company's net profit
Unit: Yuan
Company name Company Type Main business Registered Capital Total Assets Net assets Operating revenue Operating profit Net profit
Zhuhai Gree Group
Finance Company Subsidiary Financial service 3,000,000,000.00 52,270,241,505.71 6,358,255,750.06 1,904,221,332.12 540,431,914.28 407,512,564.92
Limited
Zhuhai Gree Varnished Wire
Subsidiary 1,669,315,586.15 9,239,746,829.99 3,071,150,525.96 41,290,134,072.88 274,120,524.26 206,698,823.07
Electrical Co., Ltd Manufacturing
Gree (Hefei)
Air Conditioner
Electric Appliances Subsidiary 150,000,000.00 10,909,050,309.98 4,816,014,155.88 10,216,765,020.91 552,684,110.77 498,823,394.72
Manufacturing
Co., Ltd.
Zhuhai Landa
Compressor
Compressor Co., Subsidiary 93,030,000.00 12,080,694,348.10 7,577,290,627.39 17,974,060,009.43 1,049,560,580.92 914,068,600.73
Manufacturing
Ltd.
Zhuhai Gree
Capacitor
Xinyuan Electronics Subsidiary 126,180,000.00 2,830,418,996.54 1,336,790,817.55 2,021,499,188.74 309,061,240.34 260,613,682.67
Manufacturing
Co., Ltd.
Zhuhai Kaibang
Motor Motor
Subsidiary 82,000,000.00 4,287,309,451.51 1,165,954,527.79 3,269,955,270.22 158,995,590.91 138,958,620.72
Manufacturing Co., Manufacturing
Ltd.
Gree (Zhongshan) Small household
Small Home Subsidiary appliances 30,000,000.00 1,191,788,353.90 557,136,192.42 1,030,600,093.91 91,013,640.49 84,346,186.77
Appliances Co., manufacturing
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Ltd.
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Information about acquisition and disposal of subsidiaries during the report period
√ Applicable □ Not applicable
Methods of acquisition and disposal of Impact on overall production and operation
Company name
subsidiaries during the report period and financial results(yuan)
Handan Yingdong New Energy
Cancelled -1,148.22
Technology Co., Ltd.
SL Group Ermapao Eco-Farm Co., Ltd. Cancelled -72,031.20
SL(Ningbo) Grain Sales Co., Ltd Transfer account 23,927.91
SL Group Jiangwan Rice Industry Co., Ltd Transfer account 215,501.72
SL Group Lianhe Ecology Farm Co., Ltd Transfer account -50,939.54
SL Group Yuan Agriculture Co., Ltd Transfer account 2,291.72
SL Group Lvzhiyuan Agriculture Co., Ltd Transfer account 142,792.55
SL Group Dongwei Rice Industry Co., Ltd Transfer account 92,134.32
Gree Electric Appliances (Linyi) Co., Ltd. New -5,425,480.69
Gree (Zhuhai Hengqin) GREE
New -1,549,963.17
Development Co., Ltd.
Changsha Kinghome Electrics Co., Ltd New -279,824.69
Zhuhai MinRoad Supply Chain
New -
Technology Co., Ltd
Zhuhai Gree Electormechanical
New 6,931,910.01
Engineering (Linyi) Co., Ltd.
Wuhu Gree Intelligent Logistics Co., Ltd New -
Jiangxi Jinrun Real Estate Co., Ltd New -14,190,163.54
Green Electricity New Material
New -
(Maanshan) Technology Co., Ltd.
Wuhan Yuli Runzhu Real Estate Co., Ltd New -276,336.18
Huaxingaodao (Maanshan) Technology
New -
Co., Ltd.
Description of major holding and participating companies
Not Applicable
X. Details of Company-controlled Structured Entity
□ Applicable √ Not applicable
XI. Prospects for the future development of the company
(I) Corporate development strategies
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Gree adheres to the corporate vision of "creating a world-class enterprise and achieving a century-long
brand". Driven by technological innovation and guaranteed by perfect quality, it deepens reform and accelerates
digital transformation, based on the household appliance industry, steadily expands new industries such as
intelligent equipment, precision molds, new energy, semiconductors and core components, and builds a more
competitive diversified, technology-based global industrial group.
(II) Key work in 2022
1. Strengthen the leadership of high-quality party building and build a strong base for party organizations
to fight
Guided by Xi Jinping's thought of socialism with Chinese characteristics in the new era, the company
comprehensively implements the spirit of the 19th Party Congress and the 19th Plenary Session, coordinates
epidemic prevention and control with production and operation, and further deepens the integration of Party
building work with production and operation management, innovative and realistic dedication culture and
personal development of employees.
2. Grasp the new market opportunities and develop a new diversified development pattern
Actively respond to the national strategy of expanding domestic demand, embrace the trend of upgrading the
consumption structure, continue to deepen the domestic market, deepen the construction of digital channel
marketing service network, expand the business layout of the commercial sector, expand the sales scale of
photovoltaic (storage) air conditioners, energy storage products, intelligent equipment, precision molds, special
compressors, high-end motors and other products, while grasping the "Belt and Road Initiative” and the location
advantage of the Greater Bay Area, so as to enhance the international competitiveness of the brand.
3. Persevere in scientific and technological innovation to generate new development momentum
Around the major strategic needs of the country, gave full play to the role of national key laboratories,
strengthen the reserve of cutting-edge technologies, accelerate the conquest of "bottleneck" technologies, take the
market as the center, developed high-quality products for consumers, and shape new advantages in development
relying on scientific and technological innovation.
4. Innovate quality control methods and improve quality level
With quality first as the guiding ideology and quality innovation-driven as the basic policy, lay a soild quality
technology foundation, establish intelligent quality control mechanism, continuously pursue the excellent quality
of products, projects and services, and enhance the corporate brand value and the overall image of Made in China.
5. Accelerate industrial transformation and upgrade, and promote the integration of digital technology and
industry
With high-quality development as the guide, transform industries in all aspects and chains utilizing new
Internet technologies, seize the first opportunity of the new round of technological revolution and industrial
change and promote the digital transformation of enterprises.
6. Comprehensively deepen reform and improve organizational effectiveness
Around the keynote of "cost reduction, efficiency improvement and profit creation", promote and deepen
lean management, further dig the potential of cost reduction and efficiency improvement and enhance enterprise
management efficiency through precise measures and targeted efforts.
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7. Strengthen the construction of talent echelon and build a highland for talent gathering
Improve the selection and training mechanism of talents at all levels, provide a platform for the development
of talents through multiple channels, focus our efforts on building a highland of talents, and provide key elements
for industrial development.
8. Build up security risk prevention and strengthen internal control and compliance management
Build a comprehensive discipline and audit supervision system, further enhancing security awareness, and
focus on investment, finance and other major risks to strengthen monitoring and early warning, and continuously
improve the level of the company's risk prevention and control and emergency response capabilities.
(III) Main Risks to Future Development
1. Macroeconomic fluctuation risk
The products sold by the company are mainly HVAC and household appliances, whose market demand is
influenced by the macroeconomy. The current recurring and volatile situation of the COVID-19 epidemic, the
complicated and severe geopolitical situation, the real estate market has not yet rebounded, and the uncertainty of
economic development and residents' income increases, which may lead to a slower pace of consumer recovery,
and the company's household appliance market may also face a slowdown in demand.
2. Risk of factor price fluctuations
The main raw materials for the company's products are copper, steel, aluminum and plastic of various
grades, which account for a large proportion of the cost. Starting from 2020, the prices of copper, aluminum and
other raw materials has risen rapidly and continue to run high, and the resulting cost pressure will have a certain
impact on the company's operating results. As an industry leader with strong centralized purchasing advantages,
the company will reduce the negative impact of raw material fluctuations on its operations through hedging,
advance stocking and material generalization.
3. Risks arising from increased market competition
With the implementation of the policy of “housing residence instead of vicious speculation”, the slowing
down of urbanization and the aging of the population, the air conditioning industry has bid farewell to the period
of rapid growth, and the industry is becoming increasingly competitive, which may squeeze the company's
profitability.
4. Market risks from overseas wars and trade protectionism
Geopolitical tensions, such as local wars and economic sanctions, as well as "counter-globalization" and
trade protectionism, will have a negative impact on global economic recovery and international trade, which will
not be conducive to the Company's export business.
5. Export market risk and exchange loss due to exchange rate fluctuation
The company's products are exported to more than 180 countries and regions. As the company continues to
expand its overseas markets, exchange rate fluctuations may not only adversely affect the export of the company's
products, but also cause exchange losses and increase financial costs.
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XII. Reception, research, communication, interviews and other activities during the report
period
√ Applicable □ Not applicable
Contents
Index of basic
Time of Place of Method of discussed and
Reception type Reception object information of the
reception reception reception material
research
provided
For more details, please
refer to "Gree: 000651
Total number of Gree Performance
Company
institutional and Company Presentation, Roadshow
May 24, 2021 Conference Field research Others
individual operations Activity Information
Room
investors: 127 20210525" disclosed on
www.cninfo.com.cn on
May 25, 2021.
For more details, please
refer to "Gree: 000651
Total number of Gree Performance
Company
Telephone institutional and Company Presentation, Roadshow
June 26, 2021 Conference Others
communication individual operations Event Information
Room
investors: 226 20210627" disclosed on
www.cninfo.com.cn on
June 27, 2021.
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Section IV Corporate Governance
I. Basic status of corporate governance
The Company, In strict accordance with the Company Law, Securities Law and other relevant national laws
and regulations and the Guidelines for Standardized Operation of Companies Listed on the Main Board of
Shenzhen Stock Exchange, established the normative corporate governance structure and the rules of procedure
for the General Meeting of Shareholders, Board of Directors and Board of Supervisors, clarified the
responsibilities and authorities in decision-making, performance and supervision, formed effective division of
responsibilities and balance mechanism, continuously promoted the level of normal operation and safeguarded the
interests of investors and the Company.
The Company's governance complied with the Company Law of the People's Republic of China and the
requirements of the China Securities Regulatory Commission regarding the governance of listed companies.
Whether there were any significant differences between the actual state of corporate governance and the regulations on governance of
listed companies issued by laws, administrative regulations and the CSRC
□ Yes √ No
The actual state of corporate governance did not differ materially from the laws, administrative regulations and the regulations on
governance of listed companies issued by the CSRC.
II. The independence of the company from the controlling shareholder and the actual
controller in terms of assets, personnel, finance, organization and business of the company
The Company has a sound corporate governance structure and completely separates from Zhuhai Mingjun as
the largest shareholder in business operation, personnel, assets, organization and finance, and the Company has
independent and complete business operation and independent management capability.
III. Horizontal competition
□ Applicable √ Not applicable
IV. Convening of the annual general meeting of shareholders and interim general meeting of
shareholders during the report period
1. General meetings of shareholders for the report period
Proportion of
Session of meeting Type of meeting participating Date of convening Date of disclosure Meeting resolutions
investors
2020 Annual General Annual General Announcement of
54.58% June 30, 2021 July 1, 2021
Meeting of Meeting of Resolutions of the
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Shareholders Shareholders 2020 Annual
General Meeting of
Shareholders", etc.
on
www.cninfo.com.cn
The Announcement
on Resolutions of the
The First Interim
Interim General First Interim General
General Meeting of
Meeting of 51.70% August 20, 2021 August 21, 2021 Meeting of
Shareholders for
Shareholders Shareholders for the
Year 2021
Year 2021, etc. on
www.cninfo.com.cn
The Announcement
on Resolutions of the
The Second Interim
Interim General Second Interim
General Meeting of
Meeting of 46.64% September 29, 2021 September 30, 2021 General Meeting of
Shareholders for
Shareholders Shareholders for the
Year 2021
Year 2021, etc. on
www.cninfo.com.cn
2.Convening of an interim general meeting of shareholders requested by the preferred shareholders whose
voting rights have been restored
□ Applicable √ Not applicable
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V. Directors, supervisors and senior management personnel
1. Basic Information
Number of Number of
Number of Number of
held stocks held stocks Reasons for
shares held at Other shares held at
Employment increased for reduced for increase or
Name Title Gender Age Term start date Term end date the end of the increase/decrease the end of the
status the current the current decrease of
period changes (shares) period
period period shares
(shares) (share)
(shares) (shares)
Dong Chairperson
Incumbent Female 67 May 25, 2012 February 28, 2025 44,488,492 44,488,492
Mingzhu & President
Chairman
and secretary
Zhang Wei Incumbent Male 45 January 16, 2019 February 28, 2025
of the Party
Committee
Guo Shuzhan Director Incumbent Male 65 January 16, 2019 February 28, 2025
Zhang Jundu Director Incumbent Male 61 May 25, 2012 February 28, 2025
Director,
Vice
President,
Deng Xiaobo Incumbent Male 46 December 26, 2020 February 28, 2025
Secretary of
the Board of
Directors
Independent
Liu Shuwei Incumbent Female 69 January 16, 2019 February 28, 2025
director
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Wang Independent
Incumbent Male 60 January 16, 2019 February 28, 2025
Xiaohua director
Independent
Xing Ziwen Incumbent Male 59 January 16, 2019 February 28, 2025
director
Zhang Independent
Incumbent Male 54 March 1, 2022 February 28, 2025
Qiusheng director
Cheng Min Supervisor Incumbent Female 41 November 2, 2020 February 28, 2025
Duan Reduced
Supervisor Incumbent Male 58 January 16, 2019 February 28, 2025 596,700 149,175 447,525
Xiufeng holding-shares
Employee
Wang Fawen Incumbent Female 38 January 16, 2019 February 28, 2025
supervisor
Vice
Zhuang Pei Incumbent Male 57 May 25, 2012 February 28, 2025 5,955,202 5,955,202
president
Vice
President and
Tan Jianming Incumbent Male 57 August 31, 2017 February 28, 2025 1,297,300 1,297,300
Chief
Engineer
Vice
Shu Lizhi Incumbent Male 52 December 26, 2020 February 28, 2025
president
Finance
Liao Chief,
Incumbent Male 48 August 6, 2020 February 28, 2025
Jianxiong Assistant to
President
Fang Vice
Incumbent Male 44 November 19, 2021 February 28, 2025 167,400 167,400
Xiangjian president
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Director,
Reduced
Huang Hui Executive Resigned Male 58 May 25, 2012 February 19, 2021 7,380,000 1,845,000 5,535,000
holding-shares
President
Total -- -- -- -- -- -- 59,885,094 0 1,994,175 57,890,919 --
Whether there are cases of departure of directors and supervisors and dismissal of senior management during the report period
√ Yes □ No
Mr. Huang Hui, the director and executive president of the Company, submitted a written resignation report to the Board of Directors of the Company on February 19, 2021, and he applied for
resignation as the director and executive president of the Company for personal reasons. After his resignation, Mr. Huang Hui no longer holds any position in the Company.
Changes in the Company's directors, supervisors and senior management
√ Applicable □ Not applicable
Name Position held Type Date Reason
Director, Executive
Huang Hui Resigned February 19, 2021 Resignation for personal reasons
President
Fang Xiangjian Vice president Hire November 19, 2021 Hired by the Board of Directors
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2. Employment Status
Professional background, major work experience and current major responsibilities of the Company's current
directors, supervisors and senior management
Ms. Dong Mingzhu, with a master's degree, serves as the chairperson and president of Gree Electric
Appliances, Inc of Zhuhai. She successively held the posts of salesperson, Vice Director and Director of Sales
Department, Vice General Manager, Vice Chairperson of the Board and President of Gree Electric Appliances, etc.
She was successively elected as a member of the 10th, 11th, 12th and 13th National People's Congress, a
member of the 10th, 11th and 12th Executive Committee of the All-China Women's Federation, a member of the
13th Five-Year Plan Expert Committee of the National Development and Reform Commission, a member of the
Advisory Committee of the All-China Federation of Industry and Commerce, a United Nations Ambassador for
Sustainable Urban Development, and the first rotating chair of the UNDP Commission on Sustainable
Development.
She was awarded the "National Model Worker", "National May 1 Labor Medal", "National March 8th Red
Banner Pacesetter", China Patent Gold Award, the Third China Quality Award, Liu Yuanzhang Quality
Technology Contribution Award, Fudan University Outstanding Contribution to Enterprise Management Award,
Tsinghua University Top 10 Management Innovation Leaders-Practitioners, and "China Outstanding Quality
People (National Quality Award)" and other honors and titles, and three times selected by CCTV as "CCTV China
Economic and were listed in Fortune Magazine's "World's Most Influential Women in Business" for 14 times. In
2020, she was awarded the honorary title of "Advanced Individual of Private Economy in the Fight against the
COVID-19 Epidemic" by the Central United Front Work Department, the Ministry of Industry and Information
Technology, the General Administration of Market Supervision and the All-China Federation of Industry and
Commerce for her scientific and technological fight against the epidemic. In 2021, she chaired the Sub-Committee
on Experimentation and Evaluation of Refrigeration Compressors (ISO/TC86/SC4) of the International
Organization for Standardization Technical Committee on Refrigeration and Air Conditioning.
Mr. Zhang Wei, a senior economist with a bachelor's degree, serves as the Secretary of the Party Committee
and Director of Gree Electric Appliances, Inc of Zhuhai.
He joined Gree in 1999 and successively held the posts of the head of Gree Electric Appliances Pipeline
Sub-Factory, Material Supply Department, Outsourcing Quality Management Department, Enterprise
Management Department, and Assistant to President, and served as Vice President of Gree Group from 2013 to
2020, and has served as Secretary of the Party Committee of Gree Electric Appliances from September 2020 to
the present
Mr. Guo Shuzhan, with a junior college degree, serves as a director of Gree Electric Appliances, Inc of
Zhuhai.
From August 2006 to the present, he has served as the chairman and general manager of Jinghai Internet
Technology Development Co., Ltd.; from August 2012 to the present, he has served as the general manager of
Henan Shengshi Xinxing Gree Trading Co., Ltd.; From May 2012 to January 2019, he served as a supervisor of
the company, and from January 2019 to the present, he has served as a director of the company.
Mr. Zhang Jundu, with a junior college degree, serves as a director of Gree Electric Appliances, Inc of
Zhuhai.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
From September 1999 to the present, he has served as the Chairman of Zhejiang Tongcheng Gree Electric
Appliances Co., Ltd From August 2012 to the present, he has concurrently served as the General Manager of
Zhejiang Shengshi Xinxing Gree Trading Co., Ltd, and has served as director of the company from May 2012 to
the present.
Mr. Deng Xiaobo, with a bachelor's degree, serves as a director, vice president and secretary of the Board of
Directors of Gree Electric Appliances, Inc of Zhuhai.
From July 2015 to November 2020, he served as the chairman of Shaanxi Coal and Chemical Group Finance
Co., Ltd He joined Gree Electric Appliances, Inc of Zhuhai in November 2020 and successively held the posts of
Vice President and Secretary to the Board of Directors of the company, and he has served as Director, Vice
President and Secretary to the Board of Directors of Gree Electric Appliances, Inc of Zhuhai from February 2022
to the present.
Ms. Liu Shuwei, with a master's degree, serves as an independent director of Gree Electric Appliances, Inc
of Zhuhai.
Ms. Liu graduated from Peking University with a master's degree in economics in 1986 and studied under the
tutelage of Professor Chen Daisun and Professor Li Yining, who are renowned scholars in finance. In 2002, she
was awarded "Economic Personality of the Year" and "Touching China - 2002 Person of the Year" by CCTV. She
serves as an independent director of Vanke Enterprise Co., Ltd, an independent director of Henan Costar Group
Co., Ltd., an independent director of Royole Corporation and a director and a researcher at the China Enterprise
Research Center of Central University of Finance and Economics. She has served as an independent Director of
the Company from January 2019 to the present.
Mr. Xing Ziwen, with a doctoral degree, serves as an independent director of Gree Electric Appliances, Inc
of Zhuhai.
He is currently a professor at Xi'an Jiaotong University, a Distinguished Professor under the Changjiang
Scholars Award Program of the Ministry of Education, a national candidate for the Hundred Million Talents
Project in the New Century, and a recipient of a special allowance from the State Council. Prof. Xing Ziwen was
the head of the Department of Refrigeration and Cryogenic Engineering and the director of the Compressor
Research Institute in the School of Energy and Power Engineering of Xi'an Jiaotong University, and is currently
the deputy director of the National Engineering Center for Fluid Machinery and Compressors of Xi'an Jiaotong
University. He has been awarded two National Science and Technology Progress Awards, seven Provincial and
Ministerial Science and Technology Progress Awards, and the Special Award for Science and Technology Progress
of the Chinese Society of Refrigeration, the Special Award for Invention and Entrepreneurship of the China
Invention Association, the Distinguished Professor Award of the Xia Anshi Education Foundation, and the Youth
Innovation Award of the Ho Leung Ho Lee Foundation, etc.
Mr. Wang Xiaohua, a first-class lawyer with a master's degree, serves as an independent director of Gree
Electric Appliances, Inc of Zhuhai.
Mr. Wang Xiaohua has been working in Guangdong Guangxin Junda Law Firm since January 1993, and is
currently the director of the firm. He is also a member of the Standing Committee of the Guangdong Provincial
Committee of the Chinese People's Political Consultative Conference, a member of the Judges and Prosecutors
Selection Committee of Guangdong Province, a member of the Legal Advisory Service Team of Guangdong
Provincial People's Government, and a legal advisor of Guangdong Provincial Public Security Department. In
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
addition, Mr. Wang concurrently serves as an independent director of Guangdong Shirong Zhaoye Co., Ltd.,
Guangzhou Tower Tourism and Culture Development Co., Ltd. and Guangdong Guangxin Information Industry
Co., Ltd. He served as a councilor of the National Lawyers Association, a legal advisor to the Organizing
Committee of the 16th Asian Games, a member of the 9th National Youth Federation, the president of Guangzhou
Lawyers Association, and a legal consultant and advisor to the Guangzhou Municipal People's Government. Over
the past 33 years of practice, he has handled more than 1,000 litigation, arbitration, and non-litigation cases and
projects individually or with his team, having rich experience in legal services.
Mr. Wang Xiaohua has published four monographs and co-authored four books, published more than 30
papers and articles, and submitted more than 50 proposals, and was praised by the Nanfang Daily News as a major
proposal writer.
Mr. Zhang Qiusheng, with a doctoral degree, serves as an independent director of Gree Electric Appliances,
Inc of Zhuhai.
Mr. Zhang Qiusheng is a non-practicing member of the Chinese CPA. He is currently a professor at the
School of Economics and Management of Beijing Jiaotong University, the director of the National Institute of
Transportation Development, the director of the China Center for Corporate Mergers and Acquisitions, and an
independent director of Jinneng Holdings Shanxi Coal Co., Ltd Mr. Zhang Qiusheng has undertaken various
provincial and ministerial research projects, including the National Natural Science Foundation of China, the
National Social Science Foundation of China, the National Soft Science Program, as well as the Ministry of
Education, the Ministry of Finance, the State-owned Assets Supervision and Administration Commission, the
Securities and Futures Commission, etc. He has published more than 30 monographs, books (translations) and
more than 100 academic and professional papers, and has won one second prize for national teaching
achievements, four provincial and ministerial research achievements, and two first prizes for Beijing teaching
achievements.
Ms. Cheng Min, with a bachelor's degree, serves as a supervisor of Gree Electric Appliances, Inc of Zhuhai.
Ms. Cheng serves as the Assistant to the President of Zhuhai Gree Group Co., Ltd, and Chairperson and
General Manager of Zhuhai Gexin Development Co., Ltd. She successively held the posts of the head of the
Planning Department of Zhuhai Exhibition and Convention Bureau, a member of the Party Group of Zhuhai
Exhibition and Convention Bureau, and the office director and secretary of the Board of Directors of Zhuhai Gree
Group Co., Ltd.
Mr. Duan Xiufeng serves as a supervisor of Gree Electric Appliances, Inc of Zhuhai.
He graduated from Shandong Party School in 1999 and successively held the posts of Deputy General
Manager and General Manager of Shandong Gree Marketing Co., Ltd and General Manager of Shandong
Shengshixinxing Gree Trading Co., Ltd. He has served as a supervisor of the Company from January 2019 to the
present.
Ms. Wang Fawen, wirh a master's degree a mid-level economist and human resources manager, serves as the
supervisor of the staff representative of Gree Electric Appliances, Inc of Zhuhai.
From 2007 to 2019, she successively held the posts of Human Resources Specialist of the Human Resources
Department, Director of the Personnel General Office, Supervisor of the Performance Section, Supervisor of the
Training Section, Assistant Director of the Training Department, Human Resources Department and Director of
the Training Department; from January 2019 to the present, she has served as a Supervisor of the Employee
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Representative of the Company, and from February 2019 to the present, she has served as Vice Director of the
Human Resources Department of the Company.
Mr. Zhuang Pei, with a bachelor’s degree, engineer, serves as the vice president of Gree Electric Appliances,
Inc of Zhuhai.
He served as Assistant to the President from 2002 to April 2003 and has served as Vice President from April
2003 to the present.
Mr. Tan Jianming, with a master's degree, serves as the Chief Engineer and Vice President of Gree Electric
Appliances, Inc of Zhuhai.
From 1982 to 1986, he studied refrigeration and low-temperature technology at Huazhong University of
Science and Technology and received his bachelor's degree; from 1986 to 1989, he continued his studies in
refrigeration and low-temperature technology at Huazhong University of Science and Technology and received his
master's degree; after graduation in 1989, he joined Gree Electric Appliances, Inc of Zhuhai and successively held
the posts of Designer, Director, Assistant to President, Deputy Chief Engineer, etc. He has served as Chief
Engineer and Vice President of the Company from August 2017 to the present.
Mr. Shu Lizhi, with a master's degree, serves as the Vice President of Gree Electric Appliances, Inc of
Zhuhai.
He served as the deputy director and director of Wuhan Special Commission Office of the State Audit Office.
He joined Gree Electric Appliances, Inc of Zhuhai in December 2019. He has served as Vice President of the
Company from December 2020 to the present.
Mr. Fang Xiangjian, a senior engineer with a master’s degree, serves as the Vice President of Gree Electric
Appliances, Inc of Zhuhai.
From July 2004 to December 2016, he successively held the posts of assistant to factory manager, deputy
factory manager and factory manager of the screening branch of Gree Electric Appliances, Inc of Zhuhai. He has
served as the Assistant to President of Gree Electric Appliances, Inc of Zhuhai from December 2016 to the present
and has served as the vice president of Gree Electric Appliances, Inc of Zhuhai from November, 2021 to the
present; He is the recipient of Guangdong May Day Labor Medal, Liu Yuan Zhang Quality Technology Talent
Award, and the Management Excellence Award of the Chinese Academy of Management Science; he is the vice
president of China Quality Inspection Association, a professional member of China Fire Protection Association, a
member of the 7th Academic Committee of China Quality Association, and a vice chairman of the Green and
Efficient Energy-Using Products Professional Committee of China Energy Conservation Association.
Mr. Liao Jianxiong serves as the Finance Chief and Assistant to President of Gree Electric Appliances, Inc
of Zhuhai.
He joined Gree in May 1993 and successively held the posts of the head of the Financial Department of Gree
Electric Appliances (Chongqing) Co., Ltd, head of the Financial Department of Gree Electric Appliances, Inc of
Zhuhai and Assistant to the President. He has served as the Finance Chief and assistant to the president of the
company from August 2020 to the present.
Employment in shareholder's companies
√ Applicable □ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Whether to receive
Position held
Name of remuneration and
Name of shareholder at the Term start date Term end date
incumbent allowance from the
shareholder
shareholder
Assistant to
Cheng Min Zhuhai Gree Group Co., Ltd. March 1, 2020 Yes
President
President and
Jinghai Internet Technology Development Legal
Guo Shuzhan August 1, 2006 No
Co., Ltd. Representativ
e
Description of
incumbent in
the None
shareholder's
companies
Employment in other companies
√ Applicable □ Not applicable
Whether to
receive
remunerati
Name of Position held in the
Name of other companies Term start date Term end date on and
incumbent other companies
allowance
from other
companies
Dong Zhuhai Gezhen Investment Management
Executive Partner September 26, 2019 No
Mingzhu Partnership (Limited Partnership)
Dong Director and
Zhuhai Xima Pearl New Media Co., Ltd. October 1, 2015 No
Mingzhu Manager
Guo Beijing Qianyuan Hengjiuhe Liquor Co.,
Director April 25, 2014 No
Shuzhan Ltd.
Guo
Xiahe Hengsheng Hydropower Co., Ltd. Director May 1, 2007 No
Shuzhan
Guo Henan Shengshi Xinxing Gree Trading Co.,
Executive Director August 1, 2010 Yes
Shuzhan Ltd.
Executive Director
Guo Luoyang Gree Electric Appliances Logistics
and General June 1, 2010 No
Shuzhan Co., Ltd.
Manager
Guo
Xiahe Hengfa Hydropower Co., Ltd. Director June 1, 2005 No
Shuzhan
Guo Henan Gree Installation Engineering Co., Executive Director March 10, 2021 No
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Shuzhan Ltd.
Guo
Luqu Hengfa Hydropower Co., Ltd. Supervisor September 9, 2021 No
Shuzhan
Guo Henan Sanli Real Estate Development Co.,
Supervisor November 6, 2006 No
Shuzhan Ltd.
Guo
Henan Ruige Storage Co., Ltd. Other personnel July 1, 2005 No
Shuzhan
Zhang Zhejiang Tongcheng Gree Electric
Chairman September 1, 1999 Yes
Jundu Appliances Co., Ltd.
Zhang Ningbo Tongcheng Gree Electric
Director July 1, 2013 No
Jundu Appliances Co., Ltd.
Executive Director
Zhang Zhejiang Shengshi Xinxing Gree Trading
and General January 1, 2017 Yes
Jundu Co., Ltd.
Manager
Zhang
Zhejiang Ruitong Automobile Co., Ltd. Director December 1, 2014 No
Jundu
Zhang Wenzhou Tongcheng Economic and Trade
Director April 1, 2012 No
Jundu Co., Ltd.
Zhang Huzhou Tongcheng Gree Electric
Director November 1, 2008 No
Jundu Appliances Co., Ltd.
Liu Independent
Vanke Enterprise Co., Ltd June 30, 2017 June 29, 2023 Yes
Shuwei director
Liu Independent
Royole Corporation June 23, 2020 Yes
Shuwei director
Liu Independent
Costar Group Co., Ltd. April 10, 2019 April 10, 2022 Yes
Shuwei director
Wang
Guangdong Guangxin Junda Law Firm Partner chairman June 1, 2017 Yes
Xiaohua
Wang Independent
Arrow Home Furnishing Group Co., Ltd December 18, 2019 Yes
Xiaohua director
Wang Guangzhou Tower Tourism and Culture Independent
April 27, 2021 Yes
Xiaohua Development Co., Ltd. director
Wang Guangdong Guangxin Information Industry Independent
March 26, 2019 March 26, 2022 Yes
Xiaohua Co., Ltd. director
Zhang Independent
Jinneng Holdings Shanxi Coal Co., Ltd June 5, 2020 Yes
Qiusheng director
Executive Director
Zhang Beijing Langxin Yicheng Consulting Co.,
and General May 19, 2021 No
Qiusheng Ltd.
Manager
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Zhang
Tianjin Lishen Battery Co., Ltd Director December 25, 1997 No
Qiusheng
Duan
Beijing Detai Hengrun Investment Co., Ltd. Manager July 3, 2014 No
Xiufeng
Duan Beijing Rongzhi Xingwei Management
Manager July 2, 2013 No
Xiufeng Consulting Co., Ltd
Executive Director
Duan
Shandong Jierui Logistics Co., Ltd. and General August 11, 2010 No
Xiufeng
Manager
Duan
Jinan Qihui Microfinance Co., Ltd. Director February 4, 2009 No
Xiufeng
Executive Director
Duan Shandong Gree Electric Appliances
and General August 2, 2012 Yes
Xiufeng Customer Service Co., Ltd.
Manager
Duan Shandong Binzhou Dongsheng Real Estate
Executive Director June 26, 2009 No
Xiufeng Co., Ltd.
Duan Shandong Blue Economy Industrial Fund
Chairman November 5, 2014 No
Xiufeng Management Co., Ltd.
Duan Shandong Youbu Network Technology Co.,
Executive Director October 27, 2015 No
Xiufeng Ltd.
Executive Director
Duan Jinan Jierui New Energy Technology Co.,
and General December 21, 2016 No
Xiufeng Ltd.
Manager
Executive Director
Duan Shandong Red April Brand Management
and General August 1, 2017 No
Xiufeng Co., Ltd.
Manager
Executive Director
Duan
Shandong Red April E-commerce Co., Ltd. and General August 30, 2017 No
Xiufeng
Manager
Duan Zhongfu Huaxia Management Consulting
Chairman December 23, 2005 No
Xiufeng Co., Ltd.
Executive Director
Duan Shandong Red April Holdings Group Co.,
and General May 5, 2015 No
Xiufeng Ltd.
Manager
Executive Director
Duan Shandong Red April Venture Capital Co.,
and General April 24, 2017 No
Xiufeng Ltd.
Manager
Executive Director
Duan Shandong Red April New Energy
and General December 13, 2017 No
Xiufeng Technology Co., Ltd.
Manager
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Duan
Jinan Rural Commercial Bank Co., Ltd Supervisor May 22, 2020 No
Xiufeng
Chairman and
Cheng Min Zhuhai Gexin Development Co., Ltd. September 1, 2018 Yes
General Manager
Descriptio
n of
employme
None
nt in the
other
companies
Punishments imposed by the securities regulatory institution to the incumbent directors, supervisors and senior management
personnel or those who resigned in the report period in the recent three years
□ Applicable √ Not applicable
3. Remuneration of directors, supervisors and senior management
Decision-making procedures, determination basis, and actual payment regarding the remunerations of directors, supervisors and
senior management personnel
During the report period, the Board of Directors of the Company appraised the performance and performance
of senior management personnel on an annual basis and implemented an appraisal system based on the results of
their work in ethics, competence, diligence and performance. The Company adhered to the principle of
reasonableness, fairness and justice and laid emphasis on combination of material incentive and spiritual incentive.
As for the material incentive, the Company paid attention to reasonably controlling reward grade and properly
widening the reward gap and emphasized the time and frequency of reward. As for the spiritual incentive, the
Company paid attention to combining the corporate objectives with the spirit of dedication, sense of social
responsibility and career achievement of the senior management personnel.
Remunerations of the directors, supervisors and senior management personnel in the report period
Unit: 10,000 yuan
Whether to
Total amount of
receive
pre-tax
Employment remuneration
Name Title Gender Age remuneration
status from a related
received from the
party of the
Company
Company
Chairperson &
Dong Mingzhu Female 67 Incumbent 1,098 No
President
Chairman and
Zhang Wei secretary of the Male 45 Incumbent 366.67 No
Party Committee
Guo Shuzhan Director Male 65 Incumbent Yes
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Zhang Jundu Director Male 61 Incumbent Yes
Director, Vice
President,
Deng Xiaobo Secretary of the Male 46 Incumbent 46.67 No
Board of
Directors
Independent
Liu Shuwei Female 69 Incumbent 15 Yes
director
Independent
Wang Xiaohua Male 60 Incumbent 15 Yes
director
Independent
Xing Ziwen Male 59 Incumbent 15 No
director
Independent
Zhang Qiusheng Male 54 Incumbent No
director
Cheng Min Supervisor Female 41 Incumbent Yes
Duan Xiufeng Supervisor Male 58 Incumbent Yes
Employee
Wang Fawen Female 38 Incumbent 98.02 No
supervisor
Zhuang Pei Vice president Male 57 Incumbent 260 No
Vice President
Tan Jianming and Chief Male 57 Incumbent 400 No
Engineer
Shu Lizhi Vice president Male 52 Incumbent 150 No
Finance Chief,
Liao Jianxiong Assistant to Male 48 Incumbent 122.89 No
President
Fang Xiangjian Vice president Male 44 Incumbent 280 No
Director,
Huang Hui Executive Male 58 Resigned 10.42 No
President
Total -- -- -- -- 2,877.67 --
VI. Performance of directors' duties during the report period
1. The Board of Directors for the report period
Session of meeting Date of convening Date of disclosure Meeting resolutions
The 30th Meeting of the 11th For details, please refer to Announcement of
November 19, 2021 November 20, 2021
Session of the Board of Directors Resolutions of the 30th Meeting of the 11th
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Session of the Board of Directors (Announcement
No. 2021-079) on www.cninfo.com.cn
For details, please refer to Announcement of
The 29th Meeting of the 6th Board Resolutions of the 29th Meeting of the 11th Board
November 16, 2021 November 17, 2021
of Directors of Directors (Announcement No. 2021-075) on
www.cninfo.com.cn
For details, please refer to "Third Quarterly Report
The 28th Meeting of the 6th Board
October 26, 2021 October 27, 2021 2021" (Announcement No. 2021-071) on
of Directors
www.cninfo.com.cn
For details, please refer to Announcement of
The 27th Meeting of the 11th Resolutions of the 27th Meeting of the 11th Board
September 28, 2021 September 29, 2021
Board of Directors of Directors (Announcement No. 2021-066) on
www.cninfo.com.cn
For details, please refer to Announcement of
The 26th Meeting of the 11th Resolutions of the 26th Meeting of the 11th Board
August 30, 2021 August 31, 2021
Board of Directors of Directors (Announcement No. 2021-058) on
www.cninfo.com.cn
The 25th Meeting of the 11th For details, please refer to "2021 Semi-Annual
August 20, 2021 August 23, 2021
Board of Directors Report" on www.cninfo.com.cn.
For details, please refer to "Announcement of
The 24th Meeting of the 11th Resolutions of the 24th Meeting of the 11th Board
August 2, 2021 August 4, 2021
Board of Directors of Directors" (Announcement No. 2021-050) on
www.cninfo.com.cn
For details, please refer to "Announcement of
The 23rd Meeting of the 11th Resolutions of the 23rd Meeting of the 11th Board
June 27, 2021 June 28, 2021
Board of Directors of Directors" (Announcement No. 2021-041) on
www.cninfo.com.cn
For details, please refer to Announcement of
The 22nd Meeting of the 11th Resolutions of the 22nd Meeting of the 11th
June 18, 2021 June 21, 2021
Board of Directors Session of the Board of Directors (Announcement
No. 2021-038) on www.cninfo.com.cn
For details, please refer to "Announcement of
The 21st Meeting of the 11th Resolutions of the 21st Meeting of the 11th Board
May 26, 2021 May 27, 2021
Board of Directors of Directors" (Announcement No. 2021-030) on
www.cninfo.com.cn
The 29th Meeting of the 6th Board For more details, please refer to "First Quarterly
April 28, 2021 April 29, 2021
of Directors Report 2021" on www.cninfo.com.cn.
For details, please refer "Announcement of
The 19th Meeting of the 11th Resolutions of the Nineteenth Meeting of the 11th
April 28, 2021 April 29, 2021
Board of Directors Session of the Board of Directors"
(Announcement No. 2021-015) on
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
www.cninfo.com.cn.
2. Attendance of directors at meetings of the Board of Directors and general meetings of shareholders
Attendance of directors at meetings of the Board of Directors and general meetings of shareholders
Whether to fail
Number of
Times of to personally
meetings of Times of Times of
attending Times of attend the Times of
the Board of attending attending
meetings of absence from meetings of attending the
Name of the Directors meetings of meetings of
the Board of meetings of the Board of general
director requiring the Board of the Board of
Directors via the Board of Directors for meetings of
attendance for Directors on Directors by
communicatio Directors two Shareholders
the report the field entrusting
n tools consecutive
period
times?
Dong Mingzhu 12 2 10 0 0 No 3
Zhang Wei 12 2 10 0 0 No 3
Guo Shuzhan 12 0 12 0 0 No 3
Zhang Jundu 12 1 11 0 0 No 3
Liu Shuwei 12 2 10 0 0 No 3
Wang Xiaohua 12 2 10 0 0 No 3
Xing Ziwen 12 2 10 0 0 No 3
Huang Hui 0 0 0 0 0 No 0
Description of absence from the Board of Directors for two consecutive two times
Not Applicable
3. Directors' objection to relevant matters of the company
Whether directors raised objection to relevant issues of the Company?
□ Yes √ No
The directors didn't raise any objection to relevant issues of the Company.
4. Other descriptions for performance of duties by directors
Whether the relevant suggestions on the Company by directors were adopted
√ Yes □ No
Description of the relevant suggestions on the Company by directors that were adopted or not adopted
During the report period, the directors of the Company were able to take the best interests of the Company
and shareholders as their code of conduct, faithfully performed their duties in accordance with the relevant
regulations, attended the meetings of the Board of Directors, carefully deliberated the proposals and made
suggestions and comments on the management of the Company, which played a positive role in the effective
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
decision-making of the Board of Directors, improving the management level and standardizing the operation of
the Company.
VII. Specialized Committees under the Board of Directors during the report period
Important
Numbe Other
comments Disagreem
Committee r of perform
Member Status Date of convening Conference content and ent details
Name meetin ance of
suggestion (if any)
gs held duties
s made
Deliberated the "Company's
October 26, 2021 Report for the Third Quarter of
2021"
Deliberated the "Half-Yearly
August 20, 2021 Report for 2021 and its
Summary"
Liu Shuwei, Deliberated the "Annual
Audit
Wang Xiaohua, 4 Financial Statement for 2020",
Committee
Zhang Jundu "Annual Report for 2020 and
April 28, 2021
its Summary" and "Proposal on
Hiring the Company's Auditors
for 2021
Deliberated the "Report for the
April 28, 2021 First Quarterly of for 2021 and
Its Text"
Deliberated the "Remuneration
Distribution Plan for Directors,
April 28, 2021 Supervisors and Senior
Management Personnel for
Remuneration 2020"
Wang Xiaohua,
and Agreed to submit the
Liu Shuwei, 2
Assessment "Employee Stock Ownership
Zhang Wei
Committee Plan Phase I of Gree Electric
June 17, 2021 Appliances, Inc of Zhuhai
(Draft)" to the Board of
Directors of the Company for
deliberation
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Nomination Deliberated the "Proposal on
Xing Ziwen,
Committee of Mr. Fang Xiangjian's
Wang Xiaohua, 1 November 19, 2021
the Board of Qualification as the Vice
Zhang Wei
Directors President of the Company"
VIII. Work of the Board of Supervisors
Whether the Board of Supervisors has identified any risks in the company during its supervision activities during the report period
□ Yes √ No
The Board of Supervisors has no objection to the supervision matters during the report period.
IX. Company's staff
1. Number of employees, their specialties and education level
Number (person) of on-the-job employees of the parent company 24,453
Number (person) of on-the-job employees of the main
57,431
subsidiaries
Total number (person) of on-the-job employees 81,884
Total number (person) of employees receiving salaries for the
81,884
current period
Number (person) of retired employees for whom the parent
386
company and main subsidiaries need to bear expenses
Formation of specialties
Category of formation of specialties Number (person) of employees in the formation
Manufacturing Personnel 59,973
Sales Personnel 2,964
Technicians 14,233
Financial Personnel 1,104
Administrative Personnel 3,610
Total 81,884
Educational level
Education level category Number (person) of employees
Bachelor degree or above 17,274
College Degree 13,095
Technical Secondary School Education and below 51,515
Total 81,884
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Remuneration Policy
In 2021, the Company implemented Employee Stock Ownership Plan Phase I. The scope of participants
included directors (excluding independent directors), supervisors and senior management of the Company, as well
as middle-level cadres and core employees of the Company and its holding subsidiaries who played an important
role in the overall performance and medium- and long-term development of the Company, covering a wide area
and a large scale. The implementation of the Employee Stock Ownership Plan was conducive to improving the
long-term incentive mechanism of the Company, attracting and retaining outstanding talents, enhancing the
cohesiveness and core competitiveness of the Company, forming a benefit-sharing and risk-sharing mechanism
between shareholders and management, middle-level cadres and core employees, and ensuring the realization of
the Company's future development strategy and promoting business objectives.
Facing the uncertainty and complexity of the epidemic prevention and control and macroeconomic
environment, the company attached great attention to and protected the immediate interests of employees,
optimized and adjusted the remuneration plan accordingly, and continuously improved the job-based and
performance-oriented remuneration mechanism. At the same time, focused on high-quality talent, continued to
implement the project-based evaluation mechanism for scientific and technological talent, incentives for scientific
and technical personnel and R&D technology to make breakthroughs; strengthened the main responsibility of the
employer, implemented wage reform pilot, stable retention of the core team, optimized the construction of talent
ladder, and promoted the improvement of organizational effectiveness.
3. Training plan
Talent is the key to innovation. Gree has always adhered to the principle of "focus on the company's strategic
layout and insist on independent cultivation of talents", and has taken the initiative of talent cultivation by
independently building a training system, and increased the cultivation of innovative talents, and has realized the
supply of high-quality talents by constructing a diversified independent cultivation mechanism and accelerating
the construction of Gree Vocational College.
I. Increase the training of innovative talents to meet the supply of high-quality talents for the production
and operation of the company
Gree's talent team has been growing over the years, and in 2021, the company continued to increase internal
talent training, accelerated the continuous upgrade of the talent structure, and created a young team of officers and
entrepreneurs.
Independently training innovative scientific and technological talents. The key to enhancing the independent
innovation ability of enterprises lies in cultivating innovative scientific and technological talents. According to the
growth path of technical R&D personnel, the company set up multi-level and multi-dimensional training programs
and courses, and specially implemented practical technical training for the manufacturing industry, which was
carried out monthly and uninterruptedly according to needs, so as to realize the continuous deepening training of
technical talents and promote the development of employees to professional talents in high, precise and advanced
fields.
Cultivating skilled craftsmen for precision manufacturing. In order to adapt to the transformation of the
production model to automation and intelligence, the Company accelerates the training of applied-skilled talents.
The company vigorously carried forward the model worker and craftsman spirit of the new era, made full use of
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
the advantages of resources such as Guangdong technician, skilled master studio and technician workstation,
deepened the cultivation mechanism of the company's highly skilled talents, continued to optimize the cultivation
path of the company's employees growing from common people to skilled talents through a series of initiatives
such as skill training, skill competition and skill level assessment. At the same time realizing normalization of job
training, normalized professional training and effective upgrading training, the company selected and cultivated a
number of "high-tech and cutting-edge" skilled talents.
Creating a management team that makes a difference. Deepened and promoted the whole staff learning and
development plan, and focused on the development of all levels of management cadres, core cadres, supervisors,
team leaders, college students and other thematic training programs. Through the design of thematic projects,
strengthened the training effect, drove the overall training quality to improve and strove to forge a passionate,
capable, entrepreneurial, capable staff, to add talent for the development of enterprises. The total number of
special training sessions conducted at all levels in 2021 exceeds 20,000, with about 1.2 million participants.
II. Strengthening the ideological education and cultural dissemination, gathering the centripetal force of
the staff to work and start a business
The company attached great importance to the ideological education work of the staff, in-depth and solid
organization of the regular military training work of the whole staff, and promoted the general staff's spiritual
outlook, hammering organizational discipline through the regular big training special military training evaluation.
Carried out the flag-raising ceremony on a regular basis to uphold the sacred mission of national flag dignity and
to educate patriotism. Organized and carried out the cultural construction and evaluation activities in the factory
area to give full play to the effect of subtle influence and cohesion of the cultural construction in the factory area.
Strengthened the ideological education of party members, carefully edited, planned and designed the special party
building magazine "East" to promote the majority of employees, especially the party members to arm their minds,
guide practice and promote work.
Further deepened the value of Gree culture dissemination. The company built an internal knowledge and
information sharing system around Gree's practical experience in production, operation and management, and
promoted internal experience extraction and inheritance activities. Through the organization and implementation
of learning programs such as micro-classes for management cadres, lecture halls for technology experts, lecture
halls for skilled craftsmen, and lecture halls for internal lecturers, the company realized comprehensive Gree
experience inheritance and Gree culture dissemination. 2021 Organized approximately 90 extraction activities
throughout the year, with more than 4,000 participants. Up to now, the company has dug out and nurtured 200
group-level quality instructors and developed 800 quality courses.
III. Accelerated the construction of Gree Vocational College and promoted the diversification of training to
vocational education
The construction of Gree Vocational College campus officially started in February 2021 and is scheduled to
be completed in July 2022. The college upon completion, as a special private higher education institution, will
face the national major development strategy and the demand for talents in the Greater Bay Area. With majors
docked with strategic emerging industries such as intelligent equipment, artificial intelligence, Internet of Things,
build a number of major clusters with high market demand and strong competitiveness and development potential
in high quality, making student training more suitable for economic and social development needs.
The college will, set a benchmark and industry model for talent training in China's manufacturing industry
based on Gree, build a highland for cultivating high-quality technical skills talents based on the Greater Bay Area
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
and set new standards for talent training based on the manufacturing industry. In about five years, the college will
form the characteristics and talent cultivation mechanism that connects the education chain with the industry chain,
the value chain with the innovation chain, and create a Chinese brand of enterprise school with international
characteristics that deeply integrates industry and education.
Over the years, Gree has deepened the integration of industry and education, and won the 7th Huang Yanpei
Award for Outstanding Contribution to Vocational Education for its advanced exploration and practice in
school-enterprise cooperation, being the only enterprise unit to receive the award.
IV. Closely following the company's new retail mode marketing layout, supporting to upgrade the
company's first-line market service
Closely following the company's new retail marketing model and around the global sales market support,
continuously innovated management, and improved after-sales skills by combining training and management with
skills and service, which effectively supported and promoted the first-line market service upgrade.
In 2021, the training followed the business more actively, followed the company's large-scale engineering
sales and services, and completed the special training support for significant projects such as metro and military
industry with high quality.
The company innovated means and forms and conducted overseas customer training and technical
consultation remotely online to support overseas market development and services due to the impact of the
epidemic. The company completed 600 technical training sessions in 30 countries and trained 5000 customers
throughout the year.
The company continued to develop and innovate to bring into play the dual effectiveness of training and
management. Organized the first class of Star Service Engineer Certification, establishing the service benchmark.
Carried out safety education activities themed “Alarm Bells Ring, Remember Safety” to prevent and reduce
service safety hazards. Facing domestic market demand, precipitated quality training program brands. Organized
national touring technical training camp, Gree after-sales elite class, instructor certification and online special
learning activities to improve the professional skills of after-sales personnel. In 2021, the after-sales service
completed 5,200 learning sessions and trained 480,000 people in total.
4. Labor outsourcing
□ Applicable √ Not applicable
X. Distribution of profits and capitalization of capital reserve by the Company
Profit distribution policy during the report period, especially the formulation, implementation or adjustment of the cash dividend
policy
√ Applicable □ Not applicable
2020 Annual Equity Distribution Plan: cash dividends of 30 yuan (tax included) per 10 shares to all
shareholders based on 5,584,177,165 shares (total share capital of the Company of 6,015,730,878 shares, less
431,553,713 shares repurchased up to the disclosure date of the 2020 Annual Equity Distribution Implementation
Announcement), no bonus shares and no transfer of share capital by way of reserve. The total cash dividend was
16,752,531,495 yuan.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
The cash dividend distribution proportion of the Company since its listing is in line with the provisions of the
Articles of Association of Gree Electric Appliances, Inc of Zhuhai and cash dividend distribution policy of the
Company is in line with the provisions of laws and regulations such as the Articles of Association of Gree Electric
Appliances, Inc of Zhuhai and the requirements of the resolutions of the general meeting of shareholders. The
criteria for dividend distribution and the dividend distribution ratio are clear and unambiguous, the relevant
decision-making procedures and mechanisms are complete, and the independent directors have performed their
duties and responsibilities with due diligence and have played their roles. Minority shareholders have adequate
opportunities to express their opinions and demands on profit distribution, and the legitimate rights and interests
of minority shareholders are fully protected.
Special description of cash dividend policy
Whether to comply with the provisions of the Articles of
Association or the requirements of the general meeting's Yes
resolution:
Whether the dividend criteria and ratio are clear and
Yes
unambiguous:
Whether the relevant decision-making procedures and
Yes
mechanisms are complete:
Whether independent directors perform their duties and play
Yes
their due roles:
Whether minority shareholders have the opportunity to fully
express their opinions and demands, and whether their legitimate Yes
rights and interests are adequately protected:
The conditions and procedures are transparent and comply with
Not Applicable
regulations if the cash dividend policy is adjusted or changed:
The Company is profitable during the report period and the parent company has positive profit available for distribution to
shareholders but no cash dividend distribution plan has been proposed.
□ Applicable √ Not applicable
Profit distribution and capitalisation of capital reserves for the report period
√ Applicable □ Not applicable
Number of dividend shares per ten shares (shares) 0
Number of dividends per ten shares (yuan) (tax
20.00
included)
Share capital base for the distribution proposal
5,536,677,733
(shares)
Cash dividend amount (yuan) (tax included) 11,073,355,466.00
Amount of cash dividends by other means (e.g.
21,817,510,524.13
share repurchase) (yuan)
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Total cash dividends (including other methods)
32,890,865,990.13
(Yuan)
Distributable profit (yuan) 60,491,410,176.15
Proportion of total cash dividends (including other
100%
methods) to total profit distribution
Cash Dividend
If the Company is in a maturity stage and there are no significant capital expenditure arrangements, the cash dividends in the
current profit distribution shall account for at least 80% of the profit distribution
Detailed description of profit distribution or capitalization of capital reserve preplan
The Company intends to pay a cash dividend of 20 yuan (tax included) per 10 shares to all shareholders based on the total number
of 5,536,677,733 shares (the total share capital of the Company 5,914,469,040 shares less 377,791,307 shares in the special account
for repurchase) entitled to profit distribution as of April 29, 2022, without bonus shares and without capitalization of capital
reserve.
According to "Self-regulatory Guideline No. 9 - Share Repurchase for Listed Companies on Shenzhen Stock Exchange", the shares
in the repurchase account are not entitled to profit distribution. If during the period from the date of disclosure of this
announcement to the date of registration of the implementation of the equity distribution, the total amount of shares entitled to
profit distribution of the Company changes due to the exercise of equity incentive, conversion of convertible bonds, share
repurchase, etc., the Company will adjust the total amount of dividend accordingly on the principle that the distribution ratio per
share remains unchanged.
XI. Implementation of the company's Equity Incentive Plan, Employee Stock Ownership Plan,
or other employee incentive measures
√ Applicable □ Not applicable
1. Equity Incentive
Not Applicable
Equity Incentives Received by Directors and Senior Management of the Company
□ Applicable √ Not applicable
Appraisal mechanism and motivation of senior management
Not Applicable
2. Implementation of Employee Stock Ownership Plan
√ Applicable □ Not applicable
All Employee Stock Ownership Plans in effect during the report period
Number of Total number of Proportion to the Source of funding
Scope of employees Changes
employees shares held total share capital of for implementation
94
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
(shares) listed companies of the plan
Directors (excluding independent
directors), supervisors and senior Legal remuneration
management of the Company, as well as of employees and
middle-level cadres and core employees self-financing funds
of the Company and its subsidiaries who obtained through
4,845 46,334,473 None 0.78%
have been identified by the Board of other means as
Directors as playing an important role in permitted by laws
the overall performance and medium- and administrative
and long-term development of the regulations
Company
Shareholdings of Directors, Supervisors and Senior Management in the Employee Stock Ownership Plan during the report period
Number of shares held at Number of shares held at Proportion to the total
Name Title the beginning of the the end of the report share capital of listed
report period (shares) period (shares) companies
Dong Mingzhu Chairperson & President 0 10,000,000 0.17%
Vice President and Chief
Tan Jianming 0 488,469 0.01%
Engineer
Zhuang Pei Vice president 0 420,253 0.01%
Fang Xiangjian Vice president 0 391,890 0.01%
Chairman and secretary
Zhang Wei 0 183,328 0.00%
of the Party Committee
Director, Vice President,
Deng Xiaobo Secretary of the Board of 0 107,600 0.00%
Directors
Shu Lizhi Vice president 0 99,719 0.00%
Finance Chief, Assistant
Liao Jianxiong 0 77,663 0.00%
to President
Employee representative
Wang Fawen 0 51,355 0.00%
supervisors
Changes in asset management institutions during the report period
□ Applicable √ Not applicable
Changes in equity during the report period due to disposal of shares by holders, etc.
□ Applicable √ Not applicable
Exercise of shareholders' rights during the report period
None
Other relevant circumstances and explanations of the Employee Stock Ownership Plan during the report period
□ Applicable √ Not applicable
Change in membership of the Employee Stock Ownership Plan Management Committee
95
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
□ Applicable √ Not applicable
Financial Impact of Employee Stock Ownership Plan on Listed Companies and Related Accounting Treatment during the report
period
√ Applicable □ Not applicable
In accordance with Accounting Standards for Business Enterprises No. 11 "Share-based Payment", the Company's equity-settled
share-based payment expense for Year 2021 was 31,002,910.71 yuan.
Termination of Employee Stock Ownership Plan during the report period
□ Applicable √ Not applicable
Other statements
None
3. Other Employee Incentives
□ Applicable √ Not applicable
XII. Construction and implementation of the internal control system during the report period
1. Construction and implementation of internal control
The company continued to improve the construction of internal control system and improved the
management mechanism of rules and regulations. The company regularly reviewed the internal control system and
process, and improved and re-improves the system and process. At the same time, the company strictly
implemented the rules and regulations, continuously strengthened compliance management and risk management,
and built a perfect internal control system and process system.
The Company continued to pay attention to and strengthen the control of high-risk areas such as financial
management, asset management, capital activities, procurement business, production management, sales business
and engineering projects, and effectively improved the awareness of compliance management and the ability to
prevent and control major risks.
During the report period, the Company updated and improved its internal control system in a timely manner
in accordance with the provisions of the Basic Standard for Enterprise Internal Control and its accompanying
guidelines, taking into account changes in the Company's internal and external environment, internal organization
and management requirements.
Based on the determination of significant defects in internal control, the Company did not have any
significant defects or material defects in internal control in the financial reporting and non-financial reporting in
2021. Through the operation, analysis and evaluation of the internal control system, the Company effectively
prevented the risks in operation and management and promoted the achievement of internal control objectives. In
the future, the Company will continue to perfect the internal control system, standardize the implementation of the
internal control system, strengthen the supervision and inspection of internal control, and promote the healthy and
sustainable development of the Company.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Details of significant defects in internal control identified during the report period
□ Yes √ No
XIII. Management and control of the subsidiaries during the report period
During the report period, the subsidiaries included in the scope of consolidation by way of business
combination not under the same control include the holding subsidiary Gree Altairnano New Energy Inc. The
Company strictly followed the Internal Control System in the internal management and risk control of its
subsidiaries, and the subsidiaries reported their operations to the Company, and there were no undisclosed matters
that should be disclosed and no loss of control of the subsidiaries.
XIV. Internal Control Self-Evaluation Report or Internal Control Audit Report
1. Internal Control Self-Evaluation Report
Date of Disclosure of the Full Internal
April 30, 2022
Control Evaluation Report
Index of full text disclosure of internal
www.cninfo.com.cn
control evaluation reports
Total assets of the units included in the
scope of evaluation as a proportion to the
97.00%
total assets of the company's consolidated
financial statements
Operating revenues of the units included in
the scope of evaluation as a proportion to
98.00%
the operating revenues of the company's
consolidated financial statements
Defect identification criteria
Category Financial statements Non-Financial statement
For details, please refer to the "2021 Annual For details, please refer to the "2021
Internal Control Self-Evaluation Report of Annual Internal Control Self-Evaluation
Qualitative standard Gree Electric Appliances, Inc of Zhuhai Report of Gree Electric Appliances, Inc
disclosed on www.cninfo.com.cn on April of Zhuhai disclosed on
30, 2022 www.cninfo.com.cn on April 30, 2022
For details, please refer to the "2021 Annual For details, please refer to the "2021
Internal Control Self-Evaluation Report of Annual Internal Control Self-Evaluation
Quantitative standard Gree Electric Appliances, Inc of Zhuhai Report of Gree Electric Appliances, Inc
disclosed on www.cninfo.com.cn on April of Zhuhai disclosed on
30, 2022 www.cninfo.com.cn on April 30, 2022
Number of significant defects in the
0
financial reporting (Nos)
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Number of significant defects in the
0
non-financial reporting (Nos)
Number of material defects in the financial
0
reporting (Nos)
Number of material defects in the
0
non-financial reporting (Nos)
2. Internal Control Audit Report
√ Applicable □ Not applicable
Deliberation opinion section in the internal control audit report
We hold that the Company has maintained effective internal control of financial statements in accordance with the Basic Rules for
Internal Control of Enterprises and relevant regulations.
Disclosure of Internal Control
Disclosure
Audit Report
Date of Disclosure of Full Internal
April 30, 2022
Control Audit Report
Index of Full Text Disclosure of
www.cninfo.com.cn
Internal Control Audit Report
Type of Internal Control Audit
Standard unqualified audit opinion
Report Opinions
Is there a significant defect in the
No
non-financial reporting?
Whether the accounting firm issued a non-standard opinion on the internal control audit report
□ Yes √ No
Whether the internal control audit report issued by the accounting firm is consistent with the opinion of the Board of Directors'
Self-evaluation Report
√ Yes □ No
XV. Self-examination and rectification of listed company governance special action
Not Applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section V Environmental and Social Responsibility
I. Major environmental problems
Whether the listed company and its subsidiaries are listed as key pollutant discharge units published by the environmental protection department
√ Yes □ No
Names of
Number
Name of Major
Serial Discharge of Distribution of Discharge Pollutant Discharge Total Approved Over-standard
Company or Pollutants and Total Emission
No. Method discharge discharge ports Concentration Standard Implemented Emission Emission
Subsidiary Particular
ports
Pollutants
Phase III sewage station 49 mg/L
Level 2 limit of the
GREE COD 3 Phase IV sewage station 22 mg/L 8.058 tons/year 26.4 tons/year
second period
ELECTRIC
Intermittent Phase VI sewage station 20 mg/L specified in the
1 APPLIANCES, None
discharge Phase III sewage station 0.300 mg/L Discharge Limits of
INC. OF
Ammonia Water Pollutants
ZHUHAI 3 Phase IV sewage station 0.526 mg/L 0.114 tons/year 3.6 tons/year
nitrogen (DB44/26-2001)
Phase VI sewage station 0.365 mg/L
Total Nitrogen 5.25 mg/L 1.424 tons/year 4.41 tons/year
Pollutant Discharge
Zhuhai Landa COD 20.545 mg/L 3.113 tons/year 14.7 tons/year
Continuous Standard for
2 Compressor Co., Ammonia 1 Area C sewage station None
discharge 0.753 mg/L Electroplating Water 0.088 tons/year 2.35 tons/year
Ltd. nitrogen
(DB44/1597-2015)
Total Zinc 0.074 mg/L 0.0194 ton/year 0.29 ton/year
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
General assembly
Total Nickel 1 pretreatment discharge 0.0136 mg/L 0.00034 ton/year 0.015 ton/year
port
Electrophoresis drying Emission Standard
5.255 mg/m
waste gas vent 1 for Volatile Organic
Electrophoresis drying Compounds in
5.37 mg/m
waste gas vent 2 Printing Industry
DB44/815-2010
6 B3 spray paint room waste 2.088 tons/year 2.49 tons/year
5.375 mg/m Emission Standard
gas vent
for Volatile Organic
Spraying waste gas vent 1 10.38 mg/mCompounds in
Spraying waste gas vent 2 9.72 mg/m Furniture
Manufacturing
Spraying waste gas vent 3 12.825 mg/m
Industry
Organized
Total value Silk screen printing
discharge 1.5 mg/m DB44/814-2010
waste gas vent Emission Limits
RCO catalytic For Air Pollutants
regeneration system 1.485 mg/mDB44/ 27-2001
emission outlet Emission Standard
For Electroplating 2021 emission permit
6 Injection molding waste 3.615 tons/year
3.64 mg/m Pollutants GB not approved
gas vent
21900-2008
Hydrocarbon cleaning
2.24 mg/m Emission Standard
emission outlet
For Air Pollutants
Paint dipping waste gas From Industrial
3.6 mg/m
vent Furnaces GB
100
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
9078-1996
Emission Standard
of Volatile Organic
Pre-treatment waste gas Compounds For
4.815 mg/m
vent Surface Coating
(automobile
Manufacturing)
DB44/816-2010
Household 10.6 mg/L Hefei West Group 0.8832602
COD 2 208.704209 tons/year
Commercial 9.9 mg/L Wastewater tons/year
Treatment Plant
Household 4.45 mg/L 0.3966359
Gree Electric NH3-N 2 Connection 20.869721 tons/year
Commercial 4.80 mg/L Standards and tons/year
Appliances Intermittent
3 None
Appliance discharge Household 5.39 mg/L "Comprehensive 0.49550824
(Hefei) Co., Ltd TN 2 Sewage Discharge 29.815077 ton/year
Commercial 6.19 mg/L ton/year
Standards"
Household 0.18 mg/L (GB8978-1996) 0.01507446
TP 2 3.578266 tons/year
Commercial 0.17 mg/L Level III Criteria ton/year
Industrial effluent outfall Level I
7.8
Intermittent WS-39214A Criteria of Class II
pH value 2 /
discharge Domestic sewage outfall Pollutants (Second
Zhuhai Kaibang
8.2 Period) Maximum
Motor DW002 2021 emission permit
4 Allowable Discharge None
Manufacturing Intermittent Industrial effluent outfall not approved
Chromaticity 1 2 Concentration of /
Co., Ltd discharge WS-39214A
Water Pollutant
Intermittent Industrial effluent outfall Discharge Limits of
Suspended matter 2 4(L) mg/L /
discharge WS-39214A Guangdong (DB
101
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Domestic sewage outfall 44/26-2001)
4(L) mg/L
DW002
Industrial effluent outfall
8mg/L
Chemical oxygen Intermittent WS-39214A 1.719857136
2
demand discharge Domestic sewage outfall tons/year
4mg/L
DW002
Industrial effluent outfall
Five-day 3.2 mg/L
Intermittent WS-39214A 0.83084764
biochemical 2
discharge Domestic sewage outfall tons/year
oxygen demand 1.8 mg/L
DW002
Industrial effluent outfall
0.3 mg/L
Intermittent WS-39214A 0.007172309
Phosphate 2
discharge Domestic sewage outfall tons/year
0.02 mg/L
DW002
Industrial effluent outfall
0.068 mg/L
Ammonia Intermittent WS-39214A 0.11884688
2
nitrogen discharge Domestic sewage outfall tons/year
0.063 mg/L
DW002
Industrial effluent outfall
2.36 mg/L
Intermittent WS-39214A 0.150982587
Total Nitrogen 2
discharge Domestic sewage outfall tons/year
1.27 mg/L
DW002
Intermittent Industrial effluent outfall
Petroleum 1 0.06(L) mg/L /
discharge WS-39214A
Animal and Intermittent Domestic sewage outfall
1 0.06(L) mg/L /
vegetable oil discharge DW002
102
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Die-casting waste gas vent
5 mg/m
FQ-39214A
Organized
Particulate matter 2 Melting aluminum waste 2.1148 tons/year
discharge
waste gas vent 5.4 mg/m
FQ-39214A1
Process Waste Gas Air
Die-casting waste gas vent Pollutant Emission
15 mg/m
FQ-39214A Limits (Second Period)
Organized
Sulfur dioxide 2 Melting aluminum waste of Air Pollutant 3.3875 tons/year
discharge
waste gas vent 11 mg/m Emission Limits of
FQ-39214A1 Guangdong (DB
44/27-2001)
Die-casting waste gas vent
17 mg/m
FQ-39214A
Organized
Nitrogen Oxide 2 Melting aluminum waste 5.254 tons/year
discharge
waste gas vent 17 mg/m
FQ-39214A1
Emission Limit of
Organized Immersion paint waste gas 0.005984
Benzene 1 0.09 mg/m VOCs from waste
discharge vent FQ-39214B tons/year
gas cylinder of
Organized Immersion paint waste gas Guangdong Surface 0.602552
Toluene+Xylene 1 2.27 mg/m
discharge vent FQ-39214B Coating tons/year
(Automobile
Manufacturing)
Organized Immersion paint waste gas Volatile Organic
Total VOCs 1 5.31 mg/m 2.08756 tons/year
discharge vent FQ-39214B Compound Emission
Standard(DB
44/816-2010)
5 Zhuhai Gree Benzene Organized 12 Plant No.1 FQ113913A01 4.51 mg/m Second Period Level 0.017 ton/year 2021 emission permit None
103
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Electrical Co., discharge Plant No.1 FQ113913A02 0.01 mg/m II Criteria of not approved
Ltd Guangdong "Air
Plant No.1 FQ113913A03 0.02 mg/m
Pollutant Emission
Plant No.1 FQ113913A04 0.01 mg/m Limits" (DB
Plant No.1 FQ113913A05 0.053 mg/m44/27-2001)
Plant No.1 FQ113913A06 0.04 mg/m
Plant No.1 FQ113913A07 0.38 mg/m
Plant No.1
0.01 mg/m
FQ113913A08
Plant No.3 FQ113913A09 0.02 mg/m
Plant No.3 FQ113913A10 0.02 mg/m
Plant No.3 FQ113913A11 0.01 mg/m
Plant No.3 FQ113913A12 0.01 mg/m
Plant No.1 FQ113913A01 0.53 mg/m
Plant No.1 FQ113913A02 0.037 mg/m
Second Period Level
Plant No.1 FQ113913A03 0.07 mg/m II Criteria of
Organized Guangdong "Air 2021 emission permit
Toluene 12 Plant No.1 FQ113913A04 0.03 mg/m 0.013 ton/year None
discharge Pollutant Emission not approved
Plant No.1 FQ113913A05 0.047 mg/mLimits" (DB
44/27-2001)
Plant No.1 FQ113913A06 0.02 mg/m
Plant No.1 FQ113913A07 0.22 mg/m
104
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Plant No.1
ND
FQ113913A08
Plant No.3 FQ113913A09 0.17 mg/m
Plant No.3 FQ113913A10 0.09 mg/m
Plant No.3 FQ113913A11 0.03 mg/m
Plant No.3 FQ113913A12 0.08 mg/m
Plant No.1 FQ113913A01 0.28 mg/m
Plant No.1 FQ113913A02 0.16 mg/m
Plant No.1 FQ113913A03 0.18 mg/m
Plant No.1 FQ113913A04 0.03 mg/m
Plant No.1 FQ113913A05 1.21 mg/m Second Period Level
II Criteria of
Plant No.1 FQ113913A06 0.34 mg/m
Organized Guangdong "Air 2021 emission permit
Xylene 12 1.63 tons/year None
discharge Plant No.1 FQ113913A07 4.86 mg/m Pollutant Emission not approved
Limits" (DB
Plant No.1
0.11 mg/m 44/27-2001)
FQ113913A08
Plant No.3 FQ113913A09 22.7 mg/m
Plant No.3 FQ113913A10 22.9 mg/m
Plant No.3 FQ113913A11 2.4 mg/m
Plant No.3 FQ113913A12 16.9 mg/m
105
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Plant No.1 FQ113913A01 10.9 mg/m
Plant No.1 FQ113913A02 3.05 mg/m
Plant No.1 FQ113913A03 1.83 mg/m
Plant No.1 FQ113913A04 0.76 mg/m
Second Period of
Plant No.1 FQ113913A05 6.37 mg/m
Guangdong
Plant No.1 FQ113913A06 2.15 mg/m "Emission Standards
Total volatile for Volatile Organic
Organized Plant No.1 FQ113913A07 13.3 mg/m 2021 emission permit
organic 13 Compounds in 2.317 tons/year None
discharge not approved
compounds Plant No.1 Furniture
6.06 mg/m
FQ113913A08 Manufacturing
Industry" (DB
Plant No.3 FQ113913A09 28.1 mg/m
44/814-2010)
Plant No.3 FQ113913A10 28.1 mg/m
Plant No.3 FQ113913A11 6.46 mg/m
Plant No.3 FQ113913A12 20.5 mg/m
Plant No.2 FQ113913B01 2.81 mg/m
Plant No.1 FQ113913A01 ND Second Period Level
II Standard in Table
Plant No.1 FQ113913A02 ND
2 of Guangdong Air
Organized 2021 emission permit
Phenols 12 Plant No.1 FQ113913A03 ND Pollutant Emission / None
discharge not approved
Limit Value
Plant No.1 FQ113913A04 ND
Standard(DB
Plant No.1 FQ113913A05 ND 44/27-2001)
106
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Plant No.1 FQ113913A06 ND
Plant No.1 FQ113913A07 ND
Plant No.1
ND
FQ113913A08
Plant No.3 FQ113913A09 ND
Plant No.3 FQ113913A10 ND
Plant No.3 FQ113913A11 ND
Plant No.3 FQ113913A12 ND
Second Period Level
II Criteria of
Tin and its Organized Guangdong "Air 2021 emission permit
1 Plant No.2 FQ113913B01 0.908 mg/m 0.60192 tons/year None
compounds discharge Pollutant Emission not approved
Limits" (DB
44/27-2001)
Suspended matter 1 12 mg/L 0.022 tons/year
Animal and 0.00070059
1 0.29 mg/L Second Period Level
vegetable oil ton/year
III Standard in Table
4 of Guangdong 0.0001050885
Petroleum Intermittent 1 0.33 mg/L 2021 emission permit
Plant No.2 gate DW001 Water Pollution ton/year None
discharge not approved
Total Nitrogen Discharge Limit 0.008337021
1 6.14 mg/L Value (DB
(calculated as N) Ton/Year
44/26-2001)
Chemical oxygen 0.02872419
1 30 mg/L
demand ton/year
107
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Anionic 0.00050722716
1 0.159 mg/L
surfactant ton/year
Total
phosphorus 0.0003082596
1 0.35 mg/L
(calculated as tons/year
P)
Ammonia
0.005254425
Nitrogen 1 3.35 mg/L
tons/year
(NH3-N)
Five-day
0.00770649
biochemical 1 10.7 mg/L
tons/year
oxygen demand
0.000035
Volatile phenol 1 0.05 mg/L
tons/year
pH value 1 7.70 /
108
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
The construction and operation of pollution prevention and control facilities
1. Wastewater pollution prevention and control facilities
Each subsidiary of the company is equipped with corresponding wastewater treatment facilities and full-time
environmental management, operation and monitoring personnel in accordance with the environmental protection
requirements of the construction project. So far, the systems are in normal operation and have been discharged in a
stable manner without over-standard discharge.
2. Waste gas pollution prevention and control facilities
The waste gas pollution prevention and control facilities of the Company's subsidiaries operated normally,
and the indicators of waste gas monitoring were in compliance with national and local emission standards, without
over-standard discharge.
3. Solid waste treatment and disposal facilities:
The company implemented the classification and collection system of hazardous waste and entrusted the
disposal to the unit with the corresponding disposal qualification, and no illegal disposal occurred.
Assessment of environmental impact from construction projects and other administrative permits for environmental protection
The construction project of the company carried out the environmental impact assessment, obtained
environmental impact assessment, passed the environmental acceptance and obtained the emission permit in
accordance with the requirements of the Environmental Protection Bureau.
Contingency plan for environmental emergencies
In order to implement the requirements of the national "Measures on Emergency Management of
Environmental Emergencies" and related laws and regulations, and to ensure environmental emergencies to be
dealt with in a timely, orderly, efficient and appropriate manner, to protect the personal safety of the employees
and to reduce property losses, each subsidiary of the company formulated an emergency plan for environmental
emergencies and reported it to the environmental protection department for filing.
Environment self-monitoring scheme
Formulated the self-monitoring scheme in accordance with the requirements of environmental impact
assessment, inspected wastewater pollutants once a day and inspected air pollutants air pollutants.
Administrative penalties for environmental problems during the report period
Impact on the
Name of Company production and Company's
Reason for penalty Violation Penalty results
or Subsidiary operation of listed corrective measures
companies
Violation of Article Waste gas control Installed waste gas
Hefei Kinghome Fine of 10,000 yuan None
45 of the Air facilities were not treatment facilities
109
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Electrics Co., Ltd Pollution Prevention installed for the for processes that
and Control Law of processes of generate organic
the People's extrusion, plastic volatile gases.
Republic of China absorption, foam, Rectified and
and Article 45 of the injection and accepted by Hefei
Anhui Air Pollution spraying, which Ecological
Prevention and generate organic Environment
Control Regulations volatile gases. Bureau.
Other environmental information that should be disclosed
None
Measures and effects taken to reduce its carbon emissions during the report period
□ Applicable √ Not applicable
Other environmental related information
None
II. Social Responsibility
Gree actively fulfilled its social responsibility, effectively safeguarded the legitimate rights and interests of
all stakeholders, used its strength to win the recognition of the capital market and consumer market for its
enterprise, brand and products, and used its actions to promote the green and low-carbon development of the
industry (for details, please refer to the "2021 Annual Social Responsibility Report" published on
www.cninfo.com.cn on April 30, 2022).
III. Consolidating and expanding the results of poverty alleviation and rural revitalization
During the report period, the company did not carry out any work related to consolidating and expanding the
results of poverty alleviation and rural revitalization.
110
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section VI Important Matters
I. Fulfillment of commitments
1. Commitments made by the Company's actual controller(s), shareholders, related parties, acquirers, the Company and other related commitments that
have been fulfilled during the report period and have not been fulfilled as at the end of the report period
√ Applicable □ Not applicable
Reason for Commitment Commitment Committed Commitment Implementation
Commitment Content
commitment Party Type Time Period Status
Share-Splitting
Commitment
36 months
1. The transferee commits to lock up all Gree shares acquired as a result of the transfer upon completion
from the
Commitments of the registration of the transfer and not to transfer them for 36 months from the date of completion of the
date of
in the registration of the transfer; if there are relevant laws and regulations requiring the lock-up period of the
Share Sale completion
acquisition Zhuhai transferred shares to exceed the above lock-up period committed by the transferee, the transferee agrees to December
Restriction of In progress
report or Mingjun extend the lock-up period of the shares accordingly to comply with the prescribed period. 2.Upon 2, 2019
Commitment registration
equity change completion of this share transfer, the transferee shall comply with the above share lock-up undertaking for
of the
report the shares acquired by the transferee as a result of the share bonus and capital increase of the listed
transfer of
company.
shares
111
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
1. The transferee commits that it will maintain the overall stability of the management team of Gree
Electric Appliances within the scope of its authority upon completion of the transfer and that there will be
no significant changes in the governance structure of Gree Electric Appliances. 2. The transferee commits
not to initiate any proposal or proposal to relocate the headquarters and registered office of Gree Electric
Appliances from Zhuhai during the period of direct or indirect shareholding of Gree Electric Appliances,
and to actively urge all parties to ensure that the headquarters and registered office of Gree Electric
Appliances will not be relocated from Zhuhai; if any shareholder proposes any suggestion or proposal to
Zhuhai Other relocate the headquarters and registered office of Gree Electric Appliances from Zhuhai, the transferee December Long-term
In progress
Mingjun commitments commits to attend the shareholders' meeting and to vote against such proposal. 3. The Transferee commits 2, 2019 effective
to make its best effort and ability to make effective industrial investment and strategic resource
introduction for the economic development of Zhuhai, and to promote Gree to make new contribution to
the sustainable and healthy economic development of Zhuhai. 4. Zhuhai Mingjun commits to actively
exercise the shareholders' voting right in the shareholders' meeting of the listed company involving
dividend payment and to urge its nominated directors to vote in favor of the resolution of the Board of
Directors on the dividend payment ratio of not less than 50% of the annual net profit of the listed
company.
112
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Maintaining the Independence of the Listed Company: In order to ensure the
independent operation of the listed company after this equity transfer, Zhuhai Mingjun, Zhuhai Xianying
and Zhuhai Yuxiu make the following commitments: (i) To ensure asset independence and completeness
of the listed company: 1. To ensure that Gree Electric Appliances will be equipped with the relevant
production system, auxiliary production system as well as supporting facilities corresponding to its
business operations, have the right to own or use the land, workshop and machines and facilities relating
to its business operations as well as the ownership or use right to its trademarks, patent technologies and
know-how, and have an independent purchase system of raw materials and sales system of products. 2. To
ensure that Gree has independent and complete assets, and all of its assets are under the control of Gree
and are independently owned and operated by Gree. 3. To ensure that Zhuhai Mingjun and other
enterprises controlled by Zhuhai Mingjun will not illegally occupy the assets of Gree Electric Appliances
in any way; and will not use the assets of Gree Electric Appliances, or provide guarantee for the debts of
Zhuhai Mingjun and other enterprises controlled by the enterprise with Gree Electric Appliances' assets.
(ii) To ensure the independence of the personnel of the listed company: 1. To ensure that the labor,
personnel and remuneration management of Gree Electric Appliances is completely independent from its
related enterprises. 2. The recommendation of directors, supervisors and senior management by the
enterprise to Gree Electric Appliances is made through legal procedures and does not exceed the decisions
on personnel appointment and removal made by the Board of Directors and the General Meeting of
Shareholders of Gree. T (iii) To ensure the financial independence of the listed company: 1. to ensure that
Zhuhai Gree Electric Appliances will establish an independent financial department and an independent financial
Mingjun, Maintain accounting system, and will have a standardized and independent financial accounting system. 2. To
Zhuhai independence ensure that Gree Electric Appliances will open bank accounts independently and will not share bank December Long-term
In progress
Xianying, of public accounts with its related enterprises. 3. To ensure that the financial personnel of Gree Electric Appliances 2, 2019 effective
Zhuhai companies will not work part-time in its related companies. 4. To ensure that Gree Electric Appliances will be
Yuxiu independent in paying taxes according to the law. 5. To ensure that Gree Electric Appliances can make
independent financial decisions and that the intended transferee will not unlawfully interfere with Gree
Electric Appliances's fund utilization and scheduling. (iv) To ensure the independence of the listed
company: 1. To ensure that Gree Electric Appliances will establish a sound corporate governance structure
of the joint stock company and will have an independent and complete organizational structure. 2. To
ensure that the internal management bodies of Gree Electric Appliances will exercise their powers and
113
functions independently in accordance with laws, regulations and the Articles of Association of the
Company. (v) To ensure the business independence of the listed company: 1. To ensure Gree Electric
Appliances will have the assets, personnel, qualification and ability to carry out business activities
independently and will have the ability to operate independently and independently and continuously in
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Avoiding Horizontal Competition: In order to avoid horizontal competition with
the listed company, Zhuhai Mingjun, Zhuhai Xianying and Zhuhai Yuxiu make the following
commitments: 1. The enterprise and other enterprises controlled by the enterprise, the controlling
shareholder and the actual controller of the enterprise will not engage in the same or similar business as
Gree and its subsidiaries in a direct or indirect manner in the future, so as to avoid constituting direct or
indirect business competition with the business of Gree and its subsidiaries. 2. If other enterprises
controlled by the enterprise further expand their business scope, the other enterprises controlled by the
Zhuhai
enterprise will take all possible measures to avoid horizontal competition with Gree Electric Appliances
Mingjun,
Avoiding and its subsidiaries on the principle of giving priority to safeguarding the rights and interests of Gree
Zhuhai December Long-term
horizontal Electric Appliances. 3.If Gree Electric Appliances and its subsidiaries or related regulatory authorities In progress
Xianying, 2, 2019 effective
competition determine that the enterprise and other enterprises controlled by the enterprise are engaging in or will
Zhuhai
engage in any business which constitutes horizontal competition with Gree Electric Appliances and its
Yuxiu
subsidiaries, the enterprise will give up or cause the enterprises which its subsidiaries directly or indirectly
hold to give up any business or business opportunities that may result in horizontal competition, or cause
such business or business opportunities to be provided with a priority to Gree Electric Appliances or its
wholly-owned and holding subsidiaries on a fair and reasonable basis or to be transferred to other
unrelated third parties. 4. If any one of the above commitments is violated, the enterprise will be willing to
bear all the responsibilities arising therefrom, and fully compensate or reimburse all direct or indirect
losses caused to Gree Electric Appliances.
114
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Regulating Related Transactions: In order to protect the interests of public
shareholders and maintain the sustainable and healthy development of the listed company, Zhuhai
Mingjun, Zhuhai Xianying and Zhuhai Yuxiu make the following commitments: 1. To ensure the related
transactions between the enterprise and other enterprises controlled by the enterprise and Gree Electric
Appliances in the future will be conducted in fair and in accordance with the normal code of business
conduct; the enterprise commits to further regulate the related transactions with Gree Electric Appliances
and its subsidiaries. 2. The Company will perform its obligations as a shareholder of Gree Electric
Zhuhai Appliances in good faith and in goodwill, and for related transactions that cannot be avoided or exist on
Mingjun, reasonable grounds, it will sign a standard related transaction agreement with Gree Electric Appliances in
Regulating
Zhuhai accordance with the law, and fulfill the approval procedures in accordance with relevant laws, regulations, December Long-term
Affiliate In progress
Xianying, rules, other regulatory documents and the Articles of Association and; the price of related transactions will 2, 2019 effective
Transactions
Zhuhai be determined in accordance with fair and reasonable market prices, and the price of related transactions
Yuxiu will be fair; it will perform the information disclosure obligations of related transactions in accordance
with relevant laws, regulations and the Articles of Association; it will not use related transactions to
illegally transfer the funds and profits of Gree Electric Appliances or damage the interests of Gree Electric
Appliances and related shareholders. 3. To ensure that the enterprise and other enterprises controlled by
the enterprise will, in accordance with the provisions of laws, regulations and the Articles of Association,
when deliberating related transactions involving the enterprise and other enterprises controlled by the
enterprise, effectively abide by the avoidance procedure during the voting on related transactions at the
meeting of the board of shareholders or the general meeting of shareholders of Gree Electric Appliances.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Maintaining the Independence of the Listed Company: In order to guarantee the
independent operation of the listed company after this equity transfer, I make the following commitments:
(i) To ensure asset independence and completeness of the listed company: 1. To ensure that Gree Electric
Appliances will be equipped with the relevant production system, auxiliary production system as well as
supporting facilities corresponding to its business operations, have the right to own or use the land,
workshop and machines and facilities relating to its business operations as well as the ownership or use
right to its trademarks, patent technologies and know-how, and have an independent purchase system of
raw materials and sales system of products. 2. To ensure that Gree has independent and complete assets,
and all of its assets are under the control of Gree and are independently owned and operated by Gree. 3.
To ensure that Zhuhai Mingjun and other enterprises controlled by Zhuhai Mingjun will not illegally
occupy the assets of Gree Electric Appliances in any way; and will not use the assets of Gree Electric
Appliances, or provide guarantee for the debts of Zhuhai Mingjun and other enterprises controlled by the
enterprise with Gree Electric Appliances' assets. (ii) To ensure the independence of the personnel of the
listed company: 1. To ensure that the labor, personnel and remuneration management of Gree Electric
Appliances is completely independent from its related enterprises. 2. To ensure that the recommendation
of senior management personnel by me to Gree Electric Appliances is conducted in accordance with legal
procedures. T (iii) To ensure the financial independence of the listed company: 1. to ensure that Gree
Electric Appliances will establish an independent financial department and an independent financial
accounting system, and will have a standardized and independent financial accounting system. 2. To
Maintain ensure that Gree Electric Appliances will open bank accounts independently and will not share bank
Dong independence accounts with its related enterprises. 3. To ensure that the financial personnel of Gree Electric Appliances December Long-term
In progress
Mingzhu of public will not work part-time in its related companies. 4. To ensure that Gree Electric Appliances will be 2, 2019 effective
companies independent in paying taxes according to the law. 5. To ensure that Gree Electric Appliances can make
independent financial decisions and that the intended transferee will not unlawfully interfere with Gree
Electric Appliances's fund utilization and scheduling. (iv) To ensure the independence of the listed
company: 1. To ensure that Gree Electric Appliances will establish a sound corporate governance structure
of the joint stock company and will have an independent and complete organizational structure. 2. To
ensure that the internal management bodies of Gree Electric Appliances will exercise their powers and
functions independently in accordance with laws, regulations and the Articles of Association of the
Company. (v) To ensure the business independence of the listed company: 1. To ensure Gree Electric
116
Appliances will have the assets, personnel, qualification and ability to carry out business activities
independently and will have the ability to operate independently and independently and continuously in
the market. 2. To ensure that, except through the exercise of shareholders' rights and the performance of
functions and duties of board chairman / senior management personnel of the listed company, I will not
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Avoiding Horizontal Competition: I make the following commitments: 1. I and
other enterprises controlled by me will not engage in the same or similar business with Gree Electric
Appliances and its subsidiaries in a direct or indirect manner in the future, so as to avoid possible direct or
indirect business competition with Gree Electric Appliances and its subsidiaries. 2. If other enterprises
under my control further expand their business scope, the other enterprises under my control will take all
possible measures to avoid horizontal competition with Gree Electric Appliances and its subsidiaries on
the principle of giving priority to safeguarding the rights and interests of Gree Electric Appliances. 3. If
Avoiding
Dong Gree Electric Appliances and its subsidiaries or related regulatory authorities determine that I and other December Long-term
horizontal In progress
Mingzhu enterprises controlled by me are engaging in or will engage in any business which constitutes horizontal 2, 2019 effective
competition
competition with Gree Electric Appliances and its subsidiaries, I will give up or cause the enterprises
which its subsidiaries directly or indirectly hold to give up any business or business opportunities that may
result in horizontal competition, or cause such business or business opportunities to be provided with a
priority to Gree Electric Appliances or its wholly-owned and holding subsidiaries on a fair and reasonable
basis or to be transferred to other unrelated third parties. 4. If any one of the above commitments is
violated, I will be willing to bear all the responsibilities arising therefrom, and fully compensate or
reimburse all direct or indirect losses caused to Gree Electric Appliances.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Letter of Commitment on Regulating Related Transactions: I make the following commitments: 1. To
ensure that the future related transactions between I and other enterprises controlled by me and Gree
Electric Appliances will be fair and conducted in accordance with the normal business conduct standards;
and that I commit to further regulate related transactions with Gree Electric Appliances and its
subsidiaries. 2. To ensure that I will perform my obligations as a shareholder of Gree Electric Appliances
in good faith and in goodwill, and for related transactions that cannot be avoided or exist on reasonable
grounds, I will sign a standard related transaction agreement with Gree Electric Appliances in accordance
with the law, and fulfill the approval procedures in accordance with relevant laws, regulations, rules, other
Regulating
Dong regulatory documents and the Articles of Association; the price of related transactions will be determined December Long-term
Affiliate In progress
Mingzhu in accordance with fair and reasonable market prices, and the price of related transactions will be fair; I 2, 2019 effective
Transactions
will perform the information disclosure obligations of related transactions in accordance with relevant
laws, regulations and the Articles of Association; I will not use related transactions to illegally transfer the
funds and profits of Gree Electric Appliances or damage the interests of Gree Electric Appliances and
related shareholders. 3. To ensure that I and other enterprises controlled by me will, in accordance with the
provisions of laws, regulations and the Articles of Association, when deliberating related transactions
involving me and other enterprises controlled by me, effectively abide by the avoidance procedure during
the voting on related transactions at the meeting of the board of shareholders or the general meeting of
shareholders of Gree Electric Appliances.
Commitments
made during
asset
reorganization
Commitments
made during
initial public
offering or
refinancing
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
During the
period of
Equity During the period of holding shares of Gree Electric Appliances, the Company will fully assume all being a
GREE Other June 14,
Incentive reasonable expenses and economic losses (if any) incurred by Gree Electric Appliance due to the shareholder In progress
GROUP commitments 2019
Commitment Company's termination of the remaining Equity Incentive Plan. of Gree
Electric
Appliances
Other
commitments
to the
Company's
minority
shareholders
Whether
commitments
Yes
are fulfilled in
time
If
commitments
are not
fulfilled in
time, detail the
Not Applicable
specific reason
of fulfillment
failure and the
work plan for
the next step
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. The Company's assets or projects involve earnings forecast and the report period is still in the earnings
forecast period and the Company explains the assets or projects that achieve the original earnings forecast
and the relevant reasons
□ Applicable √ Not applicable
II. The listed company's non-operating funds occupied by the controlling shareholders and
their related parties
□ Applicable √ Not applicable
No controlling shareholder or its related party occupied non-operating funds of the listed company in the report period of the
Company.
III. Violation of external guarantees
□ Applicable √ Not applicable
The company has no violation of external guarantees during the report period.
IV. Statement by the Board of Directors on the latest "Non-standard Audit Report"
□ Applicable √ Not applicable
V. Description of the "Non-standard Audit Report" of the accounting firm for the report
period by the Board of Directors, Board of Supervisors and independent director (if any)
□ Applicable √ Not applicable
VI. Description of changes in accounting policies, accounting estimates or corrections of
significant accounting errors compared to the previous year's financial statement
√ Applicable □ Not applicable
1. Changes of major accounting policies
The Ministry of Finance issued the Accounting Standards for Business Enterprises No. 21 - Leases (Finance
and Accounting [2018] No. 35) on December 7, 2018, requiring companies listed at home and abroad at the same
time and companies listed overseas and adopting IFRS or Accounting Standards for Business Accounting to
prepare financial statements to implement from January 1, 2019; and requiring other domestic listed companies
implementing Accounting Standards for Business Enterprises to implement from January 1, 2021. The Company
made corresponding changes to its accounting policies in accordance with the requirements of the standard.
In accordance with the new lease standard, the Group chose not to reassess whether a contract that existed
prior to the date of the first implementation was a lease or contained a lease. Only the retained earnings at the
beginning of the period and other related statement items were adjusted on first-time implementation, and no
adjustments were made to comparable period information. The change in accounting policy did not have a
significant impact on the financial indicators of total assets, total liabilities, net assets and net profit of the
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Company.
The following shows adjustments to the financial statements at the beginning of the period of the first
implementation of the new lease standard for the first time starting from 2021:
Unit: Yuan
Amount as at 31 December, 2020 (before change) Amount as at January 1, 2021 (after change)
Report Item Parent company's Parent company's
Consolidated Statements Consolidated Statements
statement statement
Non-current assets:
Usufruct assets 38,952,103.28
Long-term unamortized 8,567,923.50 1,954,062.19
expenses
Total non-current assets 65,584,936,463.61 49,231,239,643.63 65,617,274,705.58 49,231,239,643.63
Total assets 279,217,923,628.27 239,626,991,300.20 279,250,261,870.24 239,626,991,300.20
Current liabilities:
Non-current liabilities due 22,927,889.42
within one year
Total current liabilities 158,478,718,130.74 157,595,121,705.31 158,501,646,020.16 157,595,121,705.31
Non-current liabilities:
Lease liabilities 9,410,352.55
Total non-current liabilities 3,858,718,409.39 1,216,835,596.58 3,868,128,761.94 1,216,835,596.58
Total liabilities 162,337,436,540.13 158,811,957,301.89 162,369,774,782.10 158,811,957,301.89
Total liabilities and owner's 279,217,923,628.27 239,626,991,300.20 279,250,261,870.24 239,626,991,300.20
equity
2. Changes in major accounting estimates
No.
VII. Description of changes in the consolidated statement scope in comparison with the
financial statement of last year
√ Applicable □ Not applicable
1. Business combinations not under common control
(1) Business combinations not under common control that occurred during the period
Unit: Yuan
Basis for
Name of Operating revenue
Point of Equity Equity determining Net profit from the
the Equity acquisition Acquisition from the
acquisition acquisition acquisition the acquisition date to
Purchased cost date acquisition date to
of equity proportion method acquisition statement date
Party statement date
date
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Gree
Altairnano
October 31, Purchase October 31, Acquisition
New 1,828,275,113.56 30.47% 694,344,061.76 -416,767,701.45
2021 in cash 2021 of control
Energy
Inc.
(2) Cost of business combination and goodwill
Unit: Yuan
Cost of business combination Amount
Cost of business combination 1,828,275,113.56
Less: fair value share of the identifiable net assets acquired 1,215,497,529.64
Amount of goodwill/combination cost less than the share of fair value of identifiable net asset 612,777,583.92
acquired
[Note 1] As mentioned in Note V.23 "Goodwill" to the financial statement, Gree Altairnano New Energy
became a holding subsidiary of the Company on October 31, 2021.
[Note 2] As of the acquisition date October 31, 2021, the fair value of the identifiable net assets attributable
to the owners of the parent company of Gree Altairnano New Energy was 1,215,497,529.64 yuan, and the fair
value of the corresponding identifiable net assets was appraised by China United Assets Appraisal Group Limited,
which issued appraisal report ZLPBZ [2022] No. 1362.
The formed goodwill on the combination of Gree Altairnano is mainly due to the fact that the fair value share
of the identifiable net assets of Gree Altairnano acquired by the Company on the acquisition date is lower than the
combined cost. The asset valuation on the date of this purchase used the asset-based method, the value of the
future business growth of Gree Altairnano could not be fully reflected due to the limitations of the valuation
method itself. At present, the business relationship between Gree Electric Appliances and Gree Altairnano has
been rationalized and preliminary results have been achieved. In the future, the company will continue to promote
comprehensive integration and synergistic development, grasp market and industry development opportunities,
further enhance the comprehensive competitiveness and sustainable development capability of Gree Altairnano
and prevent goodwill impairment risk.
(3) Identifiable assets and liabilities of the acquiree on the acquisition date
Unit: Yuan
Gree Altairnano New Energy Inc.
Item
Fair value on the acquisition date Book value on the acquisition date
Assets:
Monetary funds 1,646,843,953.97 1,646,843,953.97
Trading financial liabilities 10,000.00 10,000.00
Accounts receivable 2,779,548,017.55 2,779,548,017.55
Advance payments 215,800,208.73 215,800,208.73
Other receivables 234,176,292.67 234,176,292.67
Inventory 2,135,766,221.72 2,135,766,221.72
Contract assets 996,806,636.13 996,806,636.13
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Non-current assets due within one year 2,810,789.73 2,810,789.73
Other current assets 856,356,937.01 856,356,937.01
Long-term receivables 3,014,657.86 3,014,657.86
Long-term equity investments 390,685,789.09 535,849,709.81
Other equity instruments investments 2,170,000.00 2,170,000.00
Investment real estate 30,434,649.00 6,404,970.97
Fixed assets 9,851,922,127.54 8,874,157,430.70
Construction in progress 2,341,162,945.24 2,301,429,874.64
Intangible assets 3,078,130,531.23 2,103,825,250.26
Long-term unamortized expenses 18,801,886.89 18,801,886.89
Deferred income tax assets 1,906,423,128.64 1,906,423,128.64
Other non-current assets 277,326,714.43 277,326,714.43
Subtotal of assets 26,768,191,487.43 24,897,522,681.71
Liabilities:
Short-term borrowings 2,202,310,244.21 2,202,310,244.21
Notes payable 1,382,825,460.48 1,382,825,460.48
Accounts payable 4,860,305,562.25 4,860,305,562.25
Contract liabilities 5,024,137,616.68 5,024,137,616.68
Employee pay payable 49,442,281.69 49,442,281.69
Taxes and dues payable 46,366,595.59 46,366,595.59
Other payables 4,233,517,352.93 4,233,517,352.93
Non-current liabilities due within one year 98,518,621.44 98,518,621.44
Other current liabilities 2,088,457,921.70 2,088,457,921.70
Long-term borrowings 850,000,000.00 850,000,000.00
Long-term payables 392,843,262.75 392,843,262.75
Deferred Income 1,186,062,239.50 1,186,062,239.50
Deferred income tax liabilities 13,873,952.69 13,873,952.69
Subtotal of liabilities 22,428,661,111.91 22,428,661,111.91
Net assets 4,339,530,375.52 2,468,861,569.80
Before the acquisition date, affected by the corporate governance problems caused by the alleged
misappropriation of the interests of Gree Altairnano by the former controlling shareholder of Gree Altairnano,
Gree Altairnano was restricted in the financing, resulting in production capacity not being fully unleashed and in a
continuous loss; after the listed company acquired the control of Gree Altairnano on the acquisition date, Gree
Altairnano was managed in strict accordance with relevant laws and regulations and various corporate systems,
and the annual auditing accountant, China Audit Union Power Certified Public Accountants Co., Ltd. (Special
General Partnership), adjusted the accounting policies of Gree Altairnano based on the operating conditions and
prudent considerations and with reference to the standards of listed companies and made corresponding audit
adjustments. The above situation had an impact on the purchase date book value of the net assets of Gree
Altairnano.
Gree is committed to building into a more competitive, diversified, technology-based global industrial group
123
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
with a long-term, in-depth layout of the new energy sector. The company's participation in the judicial auction to
acquire Gree Altairnano aims to combine the core technologies of Gree Altairnano batteries with the company's
"zero carbon source" and other multi-dimensional low-carbon technologies to give full play to its overall resource
advantages and further improve new energy industry layout. Up to now, the business relationship between Gree
Electric Appliances and Gree Altairnano has been rationalized and preliminary results have been achieved, and the
number of new energy vehicles being made by Gree Altairnano exceeded the level of the same period in 2020 and
2021; lithium titanate battery achieved good results in overseas and domestic markets with its superior
performance, and the relevant patent has recently been selected for the list of China Patent Award, being the only
lithium battery product in the new energy industry that won the gold medal. The performance and yield of
LiFePO4 products have also been greatly improved, and the production capacity will be unleashed gradually. With
the gradual unleashing of production capacity and the recovery of profitability in the future, Gree Altairnano’s
value will also continue to increase.
(4) Gains or losses arising from the remeasurement of equity held before the purchase date at fair value
Gains or losses on
Book value of equity held
Fair value on the purchase date remeasurement of previously
Name of the Purchased Party before the acquisition date on
of share held before that date held equity interest to fair value
the acquisition date
before the acquisition date
Gree Altairnano New Energy Inc. None None None
(5) Method and key assumptions for determining fair value on the acquisition date
1. Valuation determination method: The assets and liabilities were mainly evaluated using the asset-based
method and the income method.
2. Key assumptions in the evaluation process.
A. The appraised entity is capable of making timely adjustments and innovations in line with the
development of the market and science and technology, while maintaining consistency in its business scope,
business methods and management mode.
B. Except for the fixed-asset investment on the evaluation benchmark date that there is definite evidence
showing that the production capacity will change in the future, it is assumed that the evaluated unit will not carry
out major fixed-asset investment activities that affect its operations in the future income period, and the
production capacity of the enterprise is estimated according to the condition on the evaluation benchmark date;
C. It is assumed that in the future earnings period, the evaluated unit will maintain the turnover of accounts
receivable and accounts payable similar to the historical years, with no payment in arrears that is significantly
different from the historical years;
D. The assets and liabilities declared by the appraised entity are free from title disputes and other economic
disputes;
E. The appraised entity's future sources of funding and costs for R&D and production will not have a
material adverse impact on the enterprise.
3. Reasons for asset appreciation：
A. Machinery and equipment: the market price of some equipment increased and the depreciable life of the
enterprise's equipment was shorter than the economic life of the equipment;
B. Housings and buildings: there was a difference between the depreciable life and the actual economic life,
and some buildings were built a long period of time ago, resulting in an increase in replacement costs (labor,
materials, etc.);
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
C. Land use rights: the time when the enterprise acquired the land is far from the benchmark date of the
evaluation and the price was low, and the land price increased between the acquisition date and the current
valuation benchmark date.
2. Business combination under the same control
No.
3. Reverse purchase
No.
125
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
4. Disposal of subsidiaries
Unit: Yuan
The
differenc
e
between
the Amount
Determin
disposal of other
ation
price and comprehe
methods
the share Propor nsive
Gains or and main
of the tion of Book Fair income
losses assumpti
Equity Equit subsidiar remain value of value of related to
arising ons of
dispos y y's net ing remainin remainin equity
Equity Time point from the fair
al dispo Basis for determining the point assets in equity g equity g equity investmen
Company name disposa of losing remeasure value of
propor sal at which control is lost the on the on the on the t of the
l price control ment of the
tion meth consolida date of date of date of original
remaining remainin
(%) od ted losing losing losing company
equity at g equity
financial control control control transferre
fair value. on the
statement (%) d into
date of
s investmen
losing
correspo t profit
control.
nding to and loss.
the
disposal
investme
nt.
SL Group Jiangwan Rice 255,00 2.00 Sale August, Share Transfer Agreement 215,501. 49.00 1,145,00 1,145,00 Book None
126
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Industry Co., Ltd 0.00 2021 72 0.00 0.00 value
SL Group Lianhe Ecology 21,000. August, -50,939.5 Book
21.00 Sale Share Transfer Agreement 49.00 None
Farm Co., Ltd 00 2021 4 value
SL Group Yuan Agriculture September, Industrial and commercial Book
40.00 Sale 2,291.72 30.00 None
Co., Ltd 2021 change registration value
SL Group Lvzhiyuan September, Industrial and commercial 142,792. Book
40.00 Sale 30.00 None
Agriculture Co., Ltd 2021 change registration 55 value
SL Group Dongwei Rice September, Industrial and commercial 92,134.3 Book
21.00 Sale 30.00 None
Industry Co., Ltd 2021 change registration 2 value
SL(Ningbo) Grain Sales Co., September, Industrial and commercial 23,927.9 Book
100.00 Sale None
Ltd 2021 change registration 1 value
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
5. Change of combination scope for other reasons
(1) Newly established entities for the current period
Unit: Yuan
Name Date of Net assets at the end of the Net profit from the combination
establishment period date to the end of the period
Zhuhai Gree Electormechanical Engineering (Linyi) March 1, 2021 36,931,910.01 6,931,910.01
Co., Ltd.
Wuhu Gree Intelligent Logistics Co., Ltd March 19, 2021
Gree (Zhuhai Hengqin) Development Co., Ltd. April 25, 2021 998,450,036.83 -1,549,963.17
Gree Electric Appliances (Linyi) Co., Ltd. May 6, 2021 194,574,519.31 -5,425,480.69
Jiangxi Jinrun Real Estate Co., Ltd June 16, 2021 85,809,836.46 -14,190,163.54
Changsha Kinghome Electrics Co., Ltd July 1, 2021 5,720,175.31 -279,824.69
Green Electricity New Material (Maanshan) September 7,
Technology Co., Ltd. 2021
Wuhan Yuli Runzhu Real Estate Co., Ltd September 26, 6,723,663.82 -276,336.18
2021
Hua Hin High Conductivity (Maanshan) Technology October 12, 2021
Co., Ltd.
Zhuhai MinRoad Supply Chain Technology Co., November 19,
Ltd 2021
(2)Other decrease for the current period
The company cancelled its subsidiaries, SL Group Ermapao Eco-Farm Co., Ltd. and Handan Yingdong New
Energy Technology Co., Ltd.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
VIII. Engagement and disengagement of accounting firms
Accounting firms currently hired
Union Power Certified Public Accountants (Special General
Name of domestic accounting firm
Partnership)
Remuneration for the domestic accounting firm (10,000 yuan) 396
Consecutive years for the domestic accounting firm to render
7 years
audit service
Name of Certified Public Accountant of Domestic Accounting
Han Zhenping, Qiu Yiwu
Firm
Names of certified public accountants of the domestic accounting
2 years, 1 year
firm
Whether a new accounting firm was hired for the current period
□ Yes √ No
Engagement of an accounting firm for internal control auditing, financial adviser or sponsor
√ Applicable □ Not applicable
During the year, the Company hired Union Power CPAs Co., Ltd. (special general partnership) as its internal control accounting firm.
IX. Delisting after disclosure of the Annual Report
□ Applicable √ Not applicable
X. Matters related to bankruptcy reorganization
□ Applicable √ Not applicable
The Company was not involved in any matter related to bankruptcy reorganization in the report period.
XI. Major legal action or arbitration
□ Applicable √ Not applicable
The Company was not involved in any major legal action or arbitration for the report period.
XII. Punishment and rectification
□ Applicable √ Not applicable
The Company was not involved in any punishment or rectification during the report period.
XIII. Integrity status of the Company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
XIV. Significant related transactions
1. Related transactions associated with day-to-day operation
√ Applicable □ Not applicable
Amount of Approved Available
Related Proportion Exceeding
Related Content of Price of related transaction Settlement market
Related Related transactions to amount the Date of
transaction related related-party transactions amount of related price of Disclosure Index
parties relationships pricing of similar approved disclosure
types transactions transactions (10,000 (10,000 transactions similar
principles transactions amount
yuan) yuan) transactions
Companies
Based on
where
the market
directors of
Zhejiang price, to be Disclosed on
the
Shengshi determined Payment www.cninfo.com.cn
Company Sale of Sale of Market Market April 29,
Xinxing Gree subject to 617,406.28 4.26% 720,000 No before on April 29, 2021,
act as goods products Price Price 2021
Trading Co., the delivery Announcement No.
executive
Ltd. negotiation 2021-018
directors
between
and general
two parties
managers
Based on
Companies
the market
where
Henan price, to be Disclosed on
directors of
Shengshi determined Payment www.cninfo.com.cn
the Sale of Sale of Market Market April 29,
Xinxing Gree subject to 281,758.29 1.95 680,000 No before on April 29, 2021,
Company goods products Price Price 2021
Trading Co., the delivery Announcement No.
act as
Ltd. negotiation 2021-018
executive
between
directors
two parties
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Companies
and their Based on
Sales of
Gree subsidiaries the market
intelligent
Altairnano and holding price, to be Disclosed on
equipment,
New Energy subsidiaries determined www.cninfo.com.cn
Sale of molds, Market Settlement Market April 29,
Inc. and its where the subject to 70,903.27 0.49% 300,000 No on April 29, 2021,
goods vehicle air Price by progress Price 2021
subsidiaries chairman of the Announcement No.
conditioners,
and holding the negotiation 2021-018
power
subsidiaries Company between
systems, etc.
serves as a two parties
director
Companies
and their Based on
Batteries,
Gree subsidiaries the market
energy
Altairnano and holding price, to be Disclosed on
storage
New Energy subsidiaries determined www.cninfo.com.cn
Material components, Market Settlement Market April 29,
Inc. and its where the subject to 10,861.18 0.08% 30,000 No on April 29, 2021,
Procurement new energy Price by progress Price 2021
subsidiaries chairman of the Announcement No.
vehicles and
and holding the negotiation 2021-018
accessories,
subsidiaries Company between
etc.
serves as a two parties
director
Total -- -- 980,929.02 -- 1,730,000 -- -- -- -- --
Details of large-amount sales return Not Applicable
Actual fulfillment (if any) in the report period when the
total amount is estimated by category for the daily Implementation is within the limit
related transaction to take place for the current period
131
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Cause for the large difference between transaction
Not Applicable
price and market reference price (if applicable)
132
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Related transactions of acquisition or sales of assets or equity
□ Applicable √ Not applicable
The Company was not involved in any related transaction of acquisition or sales of assets or equity in the report period.
3. Related transactions of common foreign investment
□ Applicable √ Not applicable
The Company was not involved in any related transaction of common foreign investment during the report period.
4. Associated credits and liabilities
□ Applicable √ Not applicable
The Company was not involved in any associated credit or liability in the report period.
5. Transactions with finance companies with which the company has related relationships
□ Applicable √ Not applicable
There is no deposit, loan, credit or other financial business between the company and the finance company and related parties with
which the company has related relationships.
6. Transactions between the financial company controlled by the enterprise and related parties
□ Applicable √ Not applicable
There is no significant deposit, loan, credit or other financial business between the finance company controlled by the enterprise and
related parties.
7. Other significant related transactions
□ Applicable √ Not applicable
The Company was not involved in other significant related party transactions during the report period.
XV. Significant contracts and their fulfillment
1. Information about trusteeship, contracting and lease
(1) Trusteeship
□ Applicable √ Not applicable
The Company was not involved in any trusteeship during the report period.
(2) Contracting
□ Applicable √ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
The Company was not involved in any contracting matter during the report period.
(3) Lease
□ Applicable √ Not applicable
The Company was not involved in any lease during the report period.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Significant guarantee
√ Applicable □ Not applicable
Unit: 10,000 yuan
External guarantees of the company and its subsidiaries (excluding guarantees to subsidiaries)
Date of disclosure Whether
Whether
of the the
Name of the Guarantee Actual date of Actual amount Collateral (if Counter-guarantee guarantee is
announcement Guarantee type Guarantee period fulfillment
guarantee object amount occurrence of occurrence any) (if any) for related
related to the is
parties
guarantee amount completed
None
Guarantee of the Company to its subsidiaries
Date of disclosure Whether
Whether
of the the
Name of the Guarantee Actual date of Actual amount Collateral (if Counter-guarantee guarantee is
announcement Guarantee type Guarantee period fulfillment
guarantee object amount occurrence of occurrence any) (if any) for related
related to the is
parties
guarantee amount completed
None
Guarantee of subsidiaries to subsidiaries
Date of disclosure Whether
Whether
of the the
Name of the Guarantee Actual date of Actual amount Collateral (if Counter-guarantee guarantee is
announcement Guarantee type Guarantee period fulfillment
guarantee object amount occurrence of occurrence any) (if any) for related
related to the is
parties
guarantee amount completed
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
From the effective
date of the
guarantee contract
to three years after
Gree Altairnano December 24,
65,000 December 29, 2021 65,000 General warranty None None the date of No No
New Energy Inc. 2021
expiration of the
performance period
of the debt under
the main contract
From the effective
date of the
guarantee contract
Tianjin
to three years after
Guangtong December 24,
35,000 December 29, 2021 35,000 General warranty None None the date of No No
Automobile Co., 2021
expiration of the
Ltd.
performance period
of the debt under
the main contract
From the effective
date of the
Zhuhai Gree
guarantee contract
Altairnano
December 24, to three years after
Electric 10,000 December 28, 2021 10,000 General warranty None None No No
2021 the expiration of the
Appliances, Co.,
performance period
Ltd
of the debt under
the main contract
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Zhuhai
Guangtong December 24,
30,000
Automobile Co., 2021
Ltd.
Total amount of guarantees to Total occurrence amount of
subsidiaries approved during the 140,000 guarantees to subsidiaries during 110,000
report period(C1) the report period(C2)
Total amount of guarantees to Total actual guarantee balance to
subsidiaries approved at the end of 140,000 subsidiaries at the end of the 110,000
the report period(C3) report period (C4)
Total company guarantees (i.e. total of the first three major items)
Total occurrence amount of
Total amount of guarantee approved during
140,000 guarantees incurred during the 110,000
the report period (A1+B1+C1)
report period (A2+B2+C2)
Total actual guarantee balance at
Total amount of approved guarantees at the
140,000 the end of the report period 110,000
end of the report period (A3+B3+C3)
(A4+B4+C4)
Proportion of actual total guarantees (i.e. A4+B4+C4) to the company's
1.06%
net assets
Among them:
Balance of guarantees provided by shareholders, effective controllers
0
and their related parties (D)
Debt guarantee balance for guaranteed parties whose direct or indirect
110,000
asset-liability ratio is over 70% (E)
Total guarantee amount exceeding 50% of the net assets (F) 0
Total amount of the foregoing three items (D+E+F) 110,000
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
For unexpired guarantee contracts, a description of the guarantee
liability has been incurred during the report period or there is evidence Not Applicable
of the possibility of joint and several liabilities
Description of external guarantees provided in violation of prescribed
Not Applicable
procedures (if any)
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
3. Entrusting others to execute any cash asset management
(1) Entrusted financing
√ Applicable □ Not applicable
Overview of entrusted wealth management during the report period
Unit: 10,000 yuan
Source of funds for Occurrence amount Impaired amount for
Amount overdue but
Specific type entrusted wealth of entrusted wealth Outstanding balance overdue wealth
not recovered yet
management management management
Bank wealth
management Own funds 50,156.41
products
Trust wealth
management Own funds 5,078.35
products
Broke wealth
management Own funds 8,130.93 8,130.93
products
Total 63,365.69 8,130.93
Specific situation of high-risk entrusted wealth management with large single amount or low security and poor liquidity
□ Applicable √ Not applicable
Entrusted wealth management has the circumstance that it is expected to be unable to recover the principal or other circumstances
that may cause impairment
□ Applicable √ Not applicable
(2) Entrusted loan
□ Applicable √ Not applicable
The Company was not involved in any entrusted loan during the report period.
4. Other significant contracts
□ Applicable √ Not applicable
The Company did not enter into any other significant contract during the report period.
XVI. Description of other significant matters
□ Applicable √ Not applicable
There were no other significant matters that need to be explained during the report period.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
XVII. Significant Matters of the Company's Subsidiaries
□ Applicable √ Not applicable
140
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section Ⅶ Changes in Shares and Shareholders
I. Changes in shares
1. Changes in share capital
Unit: shares
Before this change Increase and decrease of this change (+, -) After this change
Shares
New
Quantity Percentage Bonus Issue converted from Others Subtotal Quantity Percentage
Issue
reserved funds
I. Shares with trading restriction conditions 45,822,044 0.76% -244,719 -244,719 45,577,325 0.77%
1. Shares held by the State
2. Shares held by the state-owned legal
person
3. Shares held by other domestic capital 45,822,044 0.76% -244,719 -244,719 45,577,325 0.77%
Among them: Shares held by the
domestic legal person
Shares held by the domestic
45,822,044 0.76% -244,719 -244,719 45,577,325 0.77%
natural person
4. Shares held by the foreign capital
Among them: Shares held by the
foreign legal person
Shares held by the foreign natural
person
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
II. Shares without trading restriction
5,969,908,834 99.24% -101,017,119 -101,017,119 5,868,891,715 99.23%
conditions
1. RMB common stocks 5,969,908,834 99.24% -101,017,119 -101,017,119 5,868,891,715 99.23%
2. Domestically listed foreign shares
3. Overseas listed foreign shares
4. Others
III. Total of shares 6,015,730,878 100.00% -101,261,838 -101,261,838 5,914,469,040 100.00%
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Causes for changes in share capital
√ Applicable □ Not applicable
On November 9, 2021, the total share capital of the Company and the number of circulating shares with
unlimited sale conditions changed from 6,015,730,878 shares to 5,914,469,040 shares as a result of the
cancellation of shares in the special securities account for the repurchase, please refer to "Announcement of
Zhuhai Gree Electric Appliances, Inc. Announcement No.: 2021-073) on www.cninfo.com.cn.
Approval of share changes
√ Applicable □ Not applicable
The Company held the 23th Meeting of the 11th Board of Directors and the 17th Meeting of the 11th Board
of Supervisors on June 27, 2021. The Second Interim General Meeting of 2021 held on September 29, 2021
deliberated and approved the "Proposal on Changing the Use of Repurchased Shares and Cancellation" and
decided to adjust the use of the second phase of repurchased shares from the original plan of "Repurchased shares
will be used for Employee Stock Ownership Plan or equity incentive" to "Repurchased shares will be used for
cancellation to reduce registered capital". After this change and cancellation, the total share capital of the
Company was changed from 6,015,730,878 shares to 5,914,469,040 shares. For details, please refer to
"Announcement of Zhuhai Gree Electric Appliances, Inc. on the Completion of Cancellation of Repurchased
Shares and Changes in Shares" (Announcement No. 2021-073) on www.cninfo.com.cn.
Transfer of share changes
□ Applicable √ Not applicable
Effect of share changes on financial indicators such as basic earnings per share, diluted earnings per share and net assets per share
attributable to common shareholders of the Company for the latest year and the latest period
√ Applicable □ Not applicable
The Company's net profit attributable to shareholders of the parent company in 2021 was 23,063,732,372.62
yuan, and the equity attributable to owners of the parent company was 103,651,654,599.87 yuan as of the end of
the report period. Based on the weighted average number of 5,714,951,366.88 common shares outstanding in
2021, corresponded earnings per share and diluted earnings per share were 4.04 yuan, and net asset per share was
18.14 yuan; Based on the weighted average number of 5,983,797,083.90 common shares outstanding in 2020,
earnings per share and diluted earnings per share were 3.85 yuan and the net asset value per share was 17.32 yuan.
Other contents deemed necessary by the Company or required to be disclosed by the securities regulatory authority
□ Applicable √ Not applicable
2. Changes in restricted shares
√ Applicable □ Not applicable
Unit: shares
Number of Number of Number of Number of
Name of restricted shares restricted shares restricted shares restricted shares Reasons for
Release date
shareholders at the beginning increased for the released from at the end of the restriction
of the period current period lock-up for the period
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
current period
Outgoing Senior
Wang Jingdong 884,674 221,169 663,505 Management July 16, 2022
Share Lock-Up
Senior
Duan Xiufeng 596,625 149,100 447,525 Management -
Lock-Up Shares
Senior
Fang Xiangjian 0 125,550 125,550 Management -
Lock-Up Shares
Total 1,481,299 125,550 370,269 1,236,580 -- --
II. Issuance and listing of securities
1. Issuance of securities (excluding preferred shares) during the report period
□ Applicable √ Not applicable
2. Description of changes in the Company's total number of shares and shareholder structure, and assets
and liability structure
√ Applicable □ Not applicable
The Company held the 23th Meeting of the 11th Board of Directors and the 17th Meeting of the 11th Board
of Supervisors on June 27, 2021. The Second interim General Meeting of 2021 held on September 29, 2021
deliberated and approved the "Proposal on Changing the Use of Repurchased Shares and Cancellation", and
decided to adjust the use of the second phase of repurchased shares from the original plan of "repurchased shares
will be used for employee stock ownership plan or equity incentive" to "repurchased shares will be used for
cancellation to reduce registered capital". After this change and cancellation, the total share capital of the
Company was changed from 6,015,730,878 shares to 5,914,469,040 shares.
On November 9, 2021, the total share capital of the Company and the number of circulating shares with
unlimited sale conditions changed from 6,015,730,878 shares to 5,914,469,040 shares as a result of the
cancellation of shares in the special securities account for the repurchase, please refer to "Announcement of
Zhuhai Gree Electric Appliances, Inc. Announcement No.: 2021-073) on www.cninfo.com.cn.
3.Existing internal employee stock
□ Applicable √ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
III. Information about the shareholders and actual controllers
1. Number of shareholders and their shareholding status
Unit: shares
Total number of preferred
shareholders (if any)
Total number of common Total number of preferred
Total number of whose voting rights were
shareholders at the end of shareholders (if any) whose
common shareholders restored at the end of last
949,288 last month before the 926,919 voting rights were restored at 0 0
at the end of the report month before the
disclosure date of the the end of report period (See
period disclosure date of the
annual report Note 8)
annual report (See Note
8)
Shareholding of the shareholders holding more than 5% of total stocks or shareholding of the top 10 shareholders
Number of Pledged, tagged or frozen
Number of
Number of shares with
Increase/decrease shares without
Shareholding shares held at trading
Name of shareholders Nature of shareholder during the report trading
proportion the end of the restriction Stock status Quantity
period restriction
period conditions
conditions held
held
Zhuhai Mingjun Investment
Domestic non-state-owned
Partnership (Limited 15.26% 902,359,632 Pledged 902,359,632
legal person
Partnership)
Hong Kong Securities
Foreign legal person 11.15% 659,345,659 -465,565,385
Clearing Company Ltd.
Jinghai Internet Technology Domestic non-state-owned
8.34% 493,140,455
Development Co., Ltd. legal person
145
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
China Securities Finance
State-owned legal person 3.04% 179,870,800
Co., Ltd.
Zhuhai Gree Group Co.,
State-owned legal person 2.87% 169,519,792 -24,376,200
Ltd.
Foresea Life Insurance Co.,
Others 0.79% 46,660,192 -13,426,669
Ltd. – Hai Li Nian Nian
Zhuhai Gree Electric
Appliances, Inc.- Employee
Others 0.78% 46,334,473 46,334,473
Stock Ownership Plan
Phase I
Dong Mingzhu Domestic natural person 0.75 44,488,492 33,366,369 11,122,123 Pledged 17,162,750
HHLR Management
Limited - HHLR China Foreign legal person 0.73% 43,396,407
Fund
Abu Dhabi Investment
Foreign legal person 0.48% 28,401,951 3,051,813
Authority
Situation (if any) where a strategic investor or general
legal person becomes one of top 10 shareholders due to None
placement of new shares (see Note 3)
Zhuhai Mingjun Investment Partnership (Limited Partnership) and Dong Mingzhu are the persons acting in concert. Except for that, the
Description for related relationship or concerted action
Company does not know whether there is related relationship between the above shareholders or whether they are persons acting in
of the above shareholders
concert.
Description of above-mentioned shareholders’
entrusting/being entrusted with and waiving voting None
rights
146
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Special Note on the existence of repurchase accounts
Zhuhai Gree Electric Appliances, Inc. held 377,791,307 shares, or 6.39% of the shares at the end of the report period.
among the top 10 shareholders (if any) (see Note 10)
Shareholding of the top 10 shareholders of shares without trading restriction conditions
Number of shares without trading restriction conditions held at the end of the Type of stocks
Name of shareholders
report period Type of stocks Quantity
Zhuhai Mingjun Investment Partnership (Limited
902,359,632 RMB common stocks 902,359,632
Partnership)
Hong Kong Securities Clearing Company Ltd. 659,345,659 RMB common stocks 659,345,659
Jinghai Internet Technology Development Co., Ltd. 493,140,455 RMB common stocks 493,140,455
China Securities Finance Co., Ltd. 179,870,800 RMB common stocks 179,870,800
Zhuhai Gree Group Co., Ltd. 169,519,792 RMB common stocks 169,519,792
Foresea Life Insurance Co., Ltd. – Hai Li Nian Nian 46,660,192 RMB common stocks 46,660,192
Zhuhai Gree Electric Appliances, Inc.- Employee Stock
46,334,473 RMB common stocks 46,334,473
Ownership Plan Phase I
HHLR Management Limited - HHLR China Fund 43,396,407 RMB common stocks 43,396,407
Abu Dhabi Investment Authority 28,401,951 RMB common stocks 28,401,951
Central Huijin Asset Management Co., Ltd 26,291,256 RMB common stocks 26,291,256
Description for related relationship or concerted action
among the top 10 shareholders holding circulating
Zhuhai Mingjun Investment Partnership (Limited Partnership) and Dong Mingzhu are the persons acting in concert. Except for that, the
shares without trading restriction conditions and
Company does not know whether there is related relationship between the above shareholders or whether they are persons acting in
between the top 10 shareholders holding circulating
concert.
shares without trading restriction conditions and the top
10 shareholders
147
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Description of the participation in margin trading
business of the top 10 common shareholders (if any) None
(see Note 4)
Whether the top 10 common shareholders and top 10 common shareholders without trading restriction conditions of the Company conducted agreed repurchase transactions in the report period
□ Yes √ No
The top 10 common shareholders and top 10 common shareholders without trading restriction conditions of the Company didn't conduct agreed repurchase transactions in the report period.
148
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
2. Company's controlling shareholder
Nature of controlling shareholder: No controlling entity
Type of controlling shareholder: No controlling shareholder
Description of the situation that the Company has no controlling shareholder
On December 2, 2019, Gree Group and Zhuhai Mingjun signed the Share Transfer Agreement between
Zhuhai Gree Group Co., Ltd. and Zhuhai Mingjun Investment Partnership (Limited Partnership) Concerning 15%
of the Shares of Zhuhai Gree Electric Appliances, Inc., pursuant to which Gree Group transferred its 902,359,632
held in the Company (accounting for 15.00% of the Company's total equity) to Zhuhai Mingjun. After the
transaction was completed, the single largest shareholder Zhuhai Mingjun and its person acting in concert Dong
Mingzhu cannot approve the specific proposals with their voting rights on the shares of listed companies that are
actually at their disposal, which are not enough to have a significant impact on the resolutions of the shareholders'
meeting of the listed company, and cannot decide the selection of more than half of the members of the Board of
Directors of the listed company. Therefore, the listed company has no controlling shareholders and no actual
controllers. For more details, please refer to the "Reply to the Inquiry Letter from Shenzhen Stock Exchange"
disclosed by the Company on www.cninfo.com.cn on January 18, 2020.
Change in controlling shareholder during the report period
□ Applicable √ Not applicable
There was no change in the controlling shareholder of the Company during the report period.
3. Actual controller of the Company and its person acting in concert
Nature of the actual controller: No actual controller
Type of the actual controller: No actual controller
Description of the situation that the Company has no actual controller
On December 2, 2019, Gree Group and Zhuhai Mingjun signed the Share Transfer Agreement between
Zhuhai Gree Group Co., Ltd. and Zhuhai Mingjun Investment Partnership (Limited Partnership) Concerning 15%
of the Shares of Zhuhai Gree Electric Appliances, Inc., pursuant to which Gree Group transferred its 902,359,632
held in the Company (accounting for 15.00% of the Company's total equity) to Zhuhai Mingjun. After the
transaction was completed, the single largest shareholder Zhuhai Mingjun and its person acting in concert Dong
Mingzhu cannot approve the specific proposals with their voting rights on the shares of listed companies that are
actually at their disposal, which are not enough to have a significant impact on the resolutions of the shareholders'
meeting of the listed company, and cannot decide the selection of more than half of the members of the Board of
Directors of the listed company. Therefore, the listed company has no controlling shareholders and no actual
controllers. For more details, please refer to the "Reply to the Inquiry Letter from Shenzhen Stock Exchange"
disclosed by the Company on www.cninfo.com.cn on January 18, 2020.
Whether there are shareholders with a shareholding ratio of more than 10% at the ultimate control level of the Company
√ Yes □ No
Legal person
Particulars on shareholding at the ultimate control level
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Legal
Name of shareholder at the Date of
representative/Person Organization code Principal business
ultimate control level establishment
in charge
Business scope recorded in
the agreement: Equity
Zhuhai Xianying investment. (Items that
Zhuhai Mingjun Investment
Equity Investment need to be approved in
Partnership (Limited May 11, 2017 91440400MA4WJBCR4W
Partnership (Limited accordance with law can
Partnership)
Partnership) only be operated after
approval by relevant
departments)
Particulars on equity of other
domestic and overseas listed
companies controlled by the
None
shareholder at the ultimate
control level during the report
period
Change in the actual controller in the report period
□ Applicable √ Not applicable
The company has no actual controller.
The actual controller controls the Company through a trust or other asset management methods
□ Applicable √ Not applicable
4. The cumulative number of shares pledged by the controlling shareholder or the largest shareholder of
the Company and its concert parties reached 80% of the number of shares held by them in the Company.
√ Applicable □ Not applicable
Whether it
Total amount Whether there
Source of affects the
Type of of stock pledge Specific Repayment is a risk of debt
Name repayment stability of the
shareholders financing purpose Period service or
funds control of the
(10,000 yuan) liquidation
company
Zhuhai
Mingjun
Investment The largest Repayment of Own funds and
1,897,400 April 30, 2027 No No
Partnership shareholder original loan self-financing
(Limited
Partnership)
Persons acting
Personal March 18, Own funds and
Dong Mingzhu in concert with 45,000 No No
capital demand 2022 self-financing
the largest
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
shareholder
5. Other corporate shareholders holding more than 10% of shares
□ Applicable √ Not applicable
6. Restrictions on shareholding reduction by controlling shareholders, actual controllers, restructuring
parties and other committed entities
□ Applicable √ Not applicable
IV. Specific implementation of share repurchase during the report period
Progress of implementation of share repurchase
√ Applicable □ Not applicable
Number of
repurchased
shares as a
Number of Proportio Number of
Proposed proportion to
Program shares n to total Proposed repurchase Repurchase shares
repurchase the underlying
disclosure time proposing to share amount purpose repurchased
period shares covered
repurchase capital (shares)
by the Equity
Incentive Plan
(if any)
The original
purpose of the
plan was
Employee Stock
No more than
Ownership Plan or
12 months
April 13, 2020 108,365,753 1.80% 5,999,591,034.74 equity incentive, 108,365,753
from April 10,
but after approval,
2020
part of it was
changed to
cancellation
purpose
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The original
purpose of the
plan was
Employee Stock
No more than
Ownership Plan or
October 14, 12 months
101,261,838 1.68% 5,999,520,920.65 equity incentive, 101,261,838
2020 from October
but after approval,
13, 2020
part of it was
changed to
cancellation
purpose
The original
purpose of the
plan was
Employee Stock
No more than
Ownership Plan or
12 months
May 27, 2021 315,760,027 5.25% 14,999,985,072.39 equity incentive, 315,760,027
from May 26,
but after approval,
2021
part of it was
changed to
cancellation
purpose
Progress of reducing shares repurchased by centralized bidding
□ Applicable √ Not applicable
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section VIII Related Information of Preferred Share
□ Applicable √ Not applicable
The company did not have any preferred shares during the report period.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Section IX Related Information on Bonds
□ Applicable √ Not Applicable
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Section X Financial statement
I. Audit Report
Type of audit opinion Standard unqualified opinion
Signing date of audit report April 29, 2022
Union Power Certified Public Accountants (Special General
Name of audit agency
Partnership)
Document number of audit report Union Power Audit (2022) No.0510054
Name of certified public accountant Han Zhenping, Qiu Yiwu
Audit report text
Audit Report
Union Power Audit (2022) No.0510054
All shareholders of Zhuhai Gree Electric Appliances, Inc.:
Ⅰ Audit opinion
We have audited the financial statements of Zhuhai GREE Electric Appliances, Inc.(hereinafter referred to as "your
company"), including the consolidated and parent company's balance sheets ended December 31, 2021 and consolidated and
parent company's income statements, consolidated and parent company's cash flow statements and consolidated and parent
company's statements of changes in shareholders' equity and notes to financial statements for the year 2021.
In our opinion, the accompanying financial statements have been prepared in all material aspects in accordance with the
Accounting Standards for Business Enterprises and fairly reflected the consolidated and parent company's financial position
of your company ended December 31, 2021 and consolidated and parent company's operating results and cash flows for the
year 2021.
Ⅱ Basis for forming audit opinions
We have conducted our audit work according to the provisions of Audit Standards for Certified Public Accountants of
China. The part related to "CPA's responsibility for the audit of financial statements" in the audit report further elaborates our
responsibilities under these standards. In accordance with the China Code of Ethics for Certified Public Account, we are
independent of your company and performed other responsibilities in respect of professional ethics. We believe the audit
evidences obtained by us are sufficient and proper and shall provide the basis for expressing our audit opinion.
Ⅲ Key audit items
The key audit items are the items that are deemed to be the most important ones in the current financial statement audit
according to our professional judgment. The response to these items is based on the overall audit of the financial statements
and the formation of audit opinions. We do not give separate opinions on these items.
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(Ⅰ) Revenue recognition
Key audit items How this item is dealt with in auditing?
Please refer to "Note III, 31", "Note V, 51" and 1. We understood the internal control of key financial statements
"Note XIV, 4" in the financial statements. related to revenue recognition, and evaluated the effectiveness of
In FY2021 and FY2020 consolidated financial its design and operation;
statements of your company, the revenue from selling 2. We asked about the revenue recognition policy adopted by the
goods was 187,886,874,900 yuan and 168,190,244,000 management, checked the sales contract sample, understood the
yuan respectively, representing an increase of 11.69% delivery terms of the transaction, evaluated whether the business
year-on-year. model was consistent with revenue recognition, evaluated whether
the terms of the sales contract comply with industry practices, and
Since the amount is significant and revenue is one
whether the revenue recognition accounting policy meets the
of the key business indicators of your company, and
requirements of the accounting standards for business enterprises;
whether it is based on real transactions and whether it is
3. On the basis of audit sampling, we inspected the original
included in the appropriate accounting period has a
supporting documents related to revenue recognition, such as
significant impact on the financial statements, we
orders, delivery orders, and arrival receipts, to evaluate whether the
consider revenue recognition as a key audit matter.
revenue actually occurred and whether it was recognized in
accordance with the accounting policies;
4. On the basis of audit sampling, we implemented the letter
verification procedure, and checked the original documents of the
difference in the response letter and the situation of the payment, to
evaluate the accuracy and authenticity of the occurrence amount of
revenue;
5. We implemented an analysis procedure to analyze different
dimensions such as monthly fluctuations, sales regions, product
categories, and product gross profit margins to verify the
reasonableness of the transaction;
6. We carried out a cut-off test procedure and expanded the scope of
post-period inspections to check whether there was inter-period and
a sales return to deal with revenue inter-period;
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Key audit items How this item is dealt with in auditing?
7. We also reviewed the adequacy of the information disclosure
related to revenue recognition in "Note III. 31", "Note V. 51" and
"Note XIV. 4" in the financial statements.
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(Ⅱ) Related party relationships and transactions
Key audit items How this item is dealt with in auditing?
Please refer to "Note X, 4", "Note X, 5", "Note X, 1. We understood, evaluated and tested the internal control related to
6" and "Note X, 8" in the financial statements. ". the identification and disclosure of related party relationships and
In 2021, your company purchased 2,750,068,000 their transactions, and reviewed effectiveness of the corresponding
yuan of raw materials, fixed assets and other products internal control design and implementation
and leased 22,011,300 yuan of fixed assets from the 2. We obtained the management's statement on integrity of the related
related parties, totaling 2,772,749,300 yuan; sold party relationships and their transactions, obtained a list of related
1,085,655,200 yuan of air conditioners, intelligent party relationships provided by management, and checked it
equipment and other products and leased 900 yuan of against the information obtained from other public channels;
fixed assets to the related parties, totaling 1,085,655.71 3. We reviewed the major procurement, sales and other contracts to
yuan. identify whether there was an undisclosed related party, and also
obtained the resolution of the Board of Directors and the resolution
Because of the significant transaction amount of
of the shareholders' meeting related to the related transaction,
your company with related parties, the related party
checked the permissions and procedure of the related transaction
relationships and integrity of its transaction disclosure
decision, judged the legality and compliance of related transactions,
and the fairness of the related transaction will have a
and checked if it was authorized and approved appropriately
significant impact on the business performance and
4. We carried out the sampling inspection procedure, checked the
disclosure of information. Therefore, we regard the
corresponding transaction agreement, delivery order, receipt
related party relationships and their transactions as key
document, sales invoice, purchase invoice, sales receipt and
audit items.
purchase payment voucher, analyzed the purpose of transaction to
determine whether the way of obtaining cash flow of the two
parties before and after the transaction, amount and risks were
substantially changed, and whether the transaction has commercial
substance, and combined other audit procedures such as letters to
verify authenticity of the related transaction
5. We compared the sale and purchase prices of the related party with
the sale and purchase prices of similar products of the non-related
parties or the market prices of similar products, and judged fairness
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Key audit items How this item is dealt with in auditing?
of the related transaction price;
6. We expanded the scope of the post-period test procedure and
checked whether there was a sales return;
7. We also reviewed adequacy of the information disclosure related to
the related relationship and related transaction in "Note X, 4",
"Note X, 5", "Note X, 6" and "Note X, 8" in the financial
statement.
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(Ⅲ) Provision of inventory falling price reserves
Key audit items How this item is dealt with in auditing?
Refer to the description in "Note III. 13", "Note V.
1. We tested implementation of the internal control related to
8" and "Note V. 62" in the financial statement.
recognition of provision for inventory falling price reserves
As of December 31, 2021, the book value of
2. We evaluated the significant judgments, assumptions and estimates
inventory in your company's consolidated balance sheet
involved in management's calculation of net realizable value, and
was 4,276,559.83 yuan, wherein the book balance of
we reviewed the basis and documentation on which management
inventory was 4,490,657.00 yuan and the provision for
determined the future selling price of the inventory and the costs
inventory falling price reserves was 2,140,971.16 yuan.
incurred to completion (if relevant), selling expenses and related
Recognition of the provision for inventory falling taxes.
price reserves depends on estimation of the net
3. We carried out the auditing procedures such as checking and
realizable value of the inventory. For recognition of the
recalculation, and particularly we recalculated to determine the net
net realizable value of the inventory, the management
realizable value of the inventory according to the related data;
should estimate the future selling price of inventory, cost
4. We perform an analytical review of the ageing of inventories to
(e.g., the related cost) to be incurred, selling expenses,
determine the adequacy of the corresponding provision for
and related taxes by the time of completion.
inventory falling price reserves.
In consideration of the importance of recognition of
5. We conducted supervision of inventory taking. During supervision
the inventory and provision for inventory falling price
of inventory taking, we focused on authenticity and accuracy of the
reserves to the consolidated financial statements and the
inventory and use of the inventory, checked for slow moving
complicated calculation process of provision for
inventory and defective inventory so as to evaluate adequacy of the
inventory falling price reserves, and significant
provision for inventory falling price reserves;
judgments, assumptions and estimates of the
management involved when the net realizable value of 6. We also checked the adequacy of the information disclosure related
the inventory is determined, there may be error or to the provision for falling price reserves in "Note III. 13", "Note V.
potential management bias. Therefore, we identified it as 8" and "Note V. 62" in the financial statement.
a key audit item of your company.
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Ⅳ Other information
The management of your company is responsible for other information. Other information includes the information covered in
the 2021 annual report of your company, excluding the financial statements and our audit reports.
Our audit opinions published on financial statements do not cover any other information, and we will not publish any form of
forensic conclusion on other information.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above, and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained
in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor's report, we
conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report
in this regard.
Ⅴ Responsibilities of management and those charged with governance for financial statements
The management of your company is responsible for preparing the financial statements in accordance with the requirements of
Accounting Standards to achieve a fair presentation, and for the designing, implementing and maintaining internal control that is
necessary to ensure that the financial statements are free from material misstatements, whether due to frauds or errors.
In preparing the financial statements, the management of your company is responsible for accessing your company's ability to
continue as a going concern, disclosing matters related to going concern and using the going concern basis of accounting unless
management either intends to liquidate your company or to cease operation, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing your company's financial reporting process.
Ⅵ Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with the audit standards will always detect a material
misstatement when it exits. Misstatements may arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
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statements.
As part of an audit in accordance with the audit standards, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
(I) Identified and assessed the risks of material misstatement of the financial statements, whether due to fraud or error, designed
and performed audit procedures responsive to those risks, and obtained audit evidence that was sufficient and appropriate to provide
a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than the one resulting from
error, as fraud may involve collusion, forgery, omissions, misrepresentations, or the override of internal control.
(II) Obtained an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate.
(III) Evaluated the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosure made by management of your company.
(IV) Concluded on the appropriateness of using the going concern assumption by the management of your company, and
concluded, based on the audit evidence obtained, whether a material uncertainty exited related to events or conditions that might cast
significant doubt on our company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we were
required to draw attention in our auditor's report to the related disclosure in the financial statements or, if such disclosures were
inadequate, we should issue a non-unqualified opinion. Our conclusions were based on the audit evidence obtained up the date of our
auditor's report. However, future events or conditions might cause your company to cease to continue as a going concern.
(V) Evaluated the overall presentation, structure and content of the financial statements, including the disclosure, and evaluate
whether the financial statements fairly reflected the underlying transactions and events.
(VI) Obtained sufficient and appropriate audit evidence for the financial information of your company's entity or business
activities so as to express opinions on the financial statements. We are responsible for guiding, supervising and implementing group
audits. We assume full responsibility for the audit opinions.
We communicated with those charged with governance regarding, among other matters, the planned scope and timing of the
audit and significant audit matters, including any significant defects in internal control that we identify during our audit.
We also provided a statement to those charged with governance regarding the observed professional moral requirements related
to independence, and communicated with those charged with governance about all the relationships and other matters that might be
reasonably considered to affect our independence, as well as the related countermeasures (if applicable).
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The matters we communicated with governance, we determine the matters that were most important to audit of the current
period financial statements, thus constituting key audit matters. We described these matters in the audit report, unless laws and
regulations prohibit public disclosure of these matters, or, in a few cases, we confirmed that the matter should not be communicated
in the audit report if it was reasonably anticipated that the negative consequence caused by communicating a matter in the audit
report exceeds the benefit generated in terms of public interests.
Union Power Certified Public Accountants (Special General Chinese Certified Public
Partnership) Accountant:
(engagement partner)
Han Zhenping
Chinese Certified Public
Accountant:
Qiu Yiwu
Wuhan, China April 29, 2022
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Consolidated Balance Sheet
December 31, 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note December 31, 2021 January 1, 2021 December 31, 2020
Current assets:
Monetary funds V. 1 116,939,298,776.87 136,413,143,859.81 136,413,143,859.81
Lending funds
Trading financial liabilities V. 2 370,820,500.00 370,820,500.00
Derivative financial assets V. 3 198,773,198.65 285,494,153.96 285,494,153.96
Bills receivable
Accounts receivable V. 4 13,840,898,802.76 8,738,230,905.44 8,738,230,905.44
Receivable financing V. 5 25,612,056,693.07 20,973,404,595.49 20,973,404,595.49
Advance payments V. 6 4,591,886,517.34 3,129,202,003.24 3,129,202,003.24
Other receivables V. 7 334,161,870.18 147,338,547.86 147,338,547.86
Including: Interests receivable
Dividends receivable 615,115.33
Buying back the sale of financial assets
Inventory V. 8 42,765,598,328.01 27,879,505,159.39 27,879,505,159.39
Contract assets V. 9 1,151,228,472.63 78,545,525.60 78,545,525.60
Assets held for sale
Non-current assets due within one year V. 10 11,033,571,932.60
Other current assets V. 11 9,382,177,587.07 15,617,301,913.87 15,617,301,913.87
Total current assets 225,849,652,179.18 213,632,987,164.66 213,632,987,164.66
Non-current assets:
Disbursement of loans statements and
V. 12 4,142,652,901.85 5,273,805,581.52 5,273,805,581.52
advances
Debt investment
Other debt investments V. 13 5,910,056,891.62 502,202,293.17 502,202,293.17
Long-term receivables V. 14 2,419,031.07
Long-term equity investments V. 15 10,337,008,014.57 8,119,841,062.14 8,119,841,062.14
Other equity instruments investments V. 16 10,114,246,030.05 7,788,405,891.47 7,788,405,891.47
Other non-current financial assets V. 17 81,309,327.39 2,003,483,333.33 2,003,483,333.33
Investment real estate V. 18 454,854,822.63 463,420,861.39 463,420,861.39
Fixed assets V. 19 31,188,726,142.99 18,990,525,087.94 18,990,525,087.94
Construction in progress V. 20 6,481,236,333.38 4,016,082,730.07 4,016,082,730.07
Usufruct assets V. 21 14,603,282.99 38,952,103.28
Intangible assets V. 22 9,916,967,208.10 5,878,288,762.64 5,878,288,762.64
Development expenditures
Goodwill V. 23 707,629,136.24 201,902,704.02 201,902,704.02
Long-term unamortized expenses 18,724,025.74 1,954,062.19 8,567,923.50
Deferred income tax assets V. 24 13,661,849,772.68 11,550,292,201.02 11,550,292,201.02
Other non-current assets V. 25 716,248,679.90 788,118,031.40 788,118,031.40
Total non-current assets 93,748,531,601.20 65,617,274,705.58 65,584,936,463.61
Total assets 319,598,183,780.38 279,250,261,870.24 279,217,923,628.27
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Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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Consolidated Balance Sheet (Continued)
December 31, 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note December 31, 2021 January 1, 2021 December 31, 2020
Current liabilities:
Short-term borrowings V. 26 27,617,920,548.11 20,304,384,742.34 20,304,384,742.34
Loans from other banks V. 27 300,021,500.00 300,020,250.00 300,020,250.00
Trading financial liabilities
Derivative financial liabilities
Notes payable V. 30 40,743,984,514.42 21,427,071,950.32 21,427,071,950.32
Accounts payable V. 31 35,875,090,911.05 31,604,659,166.88 31,604,659,166.88
Advances from customers
Contract liabilities V. 32 15,505,499,178.75 11,678,180,424.65 11,678,180,424.65
Financial assets sold for repurchase V. 28 746,564,041.09 475,033,835.62 475,033,835.62
Deposits from customers and interbank V. 29 182,681,905.74 261,006,708.24 261,006,708.24
Employee pay payable V. 33 3,466,630,401.73 3,365,355,468.69 3,365,355,468.69
Taxes and dues payable V. 34 2,230,471,191.49 2,301,355,583.02 2,301,355,583.02
Other payables V. 35 6,763,119,937.14 2,379,395,717.44 2,379,395,717.44
Including: Interests payable
Dividends payable 2,367,112.94 6,986,645.96 6,986,645.96
Liabilities held for sale
Non-current liabilities due within one year V. 36 1,255,294,034.84 22,927,889.42
Other current liabilities V. 37 62,414,107,264.20 64,382,254,283.54 64,382,254,283.54
Total current liabilities 197,101,385,428.56 158,501,646,020.16 158,478,718,130.74
Non-current liabilities:
Long-term borrowings V. 38 8,960,864,258.30 1,860,713,816.09 1,860,713,816.09
Bonds payable
Including: Preferred stock
Perpetual bond
Lease liabilities V. 39 3,313,452.52 9,410,352.55
Long-term payables V. 40 446,194,591.92
Long-term payroll payable V. 41 164,408,471.00 149,859,788.00 149,859,788.00
Accrued liabilities
Deferred Income V. 42 2,702,653,897.78 437,033,702.46 437,033,702.46
Deferred income tax liabilities V. 24 2,293,912,513.79 1,411,111,102.84 1,411,111,102.84
Other non-current liabilities
Total non-current liabilities 14,571,347,185.31 3,868,128,761.94 3,858,718,409.39
Total liabilities 211,672,732,613.87 162,369,774,782.10 162,337,436,540.13
Shareholders’ equity:
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Capital stock V. 43 5,914,469,040.00 6,015,730,878.00 6,015,730,878.00
Other equity instruments
Including: Preferred stock
Perpetual bond
Capital reserves V. 44 125,874,127.56 121,850,280.68 121,850,280.68
Less: Treasury stock V. 45 19,579,646,233.43 5,182,273,853.90 5,182,273,853.90
Other comprehensive income V. 46 11,204,004,355.27 7,396,060,195.47 7,396,060,195.47
Special reserve V. 47 22,403,846.26
Surplus reserve V. 48 1,983,727,107.74 3,499,671,556.59 3,499,671,556.59
General risk provisions V. 49 505,599,356.30 497,575,772.26 497,575,772.26
Undistributed profit V. 50 103,475,223,000.17 102,841,596,377.66 102,841,596,377.66
Equity total attributable to the shareholders of the parent
103,651,654,599.87 115,190,211,206.76 115,190,211,206.76
company
Minority equity 4,273,796,566.64 1,690,275,881.38 1,690,275,881.38
Equity total of the shareholders 107,925,451,166.51 116,880,487,088.14 116,880,487,088.14
Total liabilities and shareholders' equity 319,598,183,780.38 279,250,261,870.24 279,217,923,628.27
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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Consolidated Income Statement
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note For the Year 2021 For the Year 2020
I. Total operating revenues 189,654,033,523.50 170,497,415,702.41
Including: Operating Revenue V. 51 187,868,874,892.71 168,199,204,404.53
Interest revenue V. 52 1,785,060,001.28 2,295,972,686.55
Fee and commission income 98,629.51 2,238,611.33
II. Total operating costs 163,521,848,332.24 146,260,681,865.34
Including: Operating Cost V. 51 142,251,638,589.87 124,229,033,680.92
Interest expense V. 52 523,238,956.03 304,448,121.92
Handling charges and commission expenses 815,760.35 516,318.75
Taxes and surcharges V. 53 1,076,664,461.78 964,600,693.81
Sales expense V. 54 11,581,735,617.31 13,043,241,798.27
Administrative expense V. 55 4,051,241,003.05 3,603,782,803.64
Research and development expenses V. 56 6,296,715,941.03 6,052,563,108.10
Financial expense V. 57 -2,260,201,997.18 -1,937,504,660.07
Including: Interest expense 1,752,112,003.72 1,088,369,394.87
Interest revenue 4,242,449,764.06 3,708,312,903.06
Add: Other incomes V. 58 832,177,253.43 1,164,120,111.04
Income from investments (losses expressed with "-") V. 59 522,063,222.58 713,010,071.67
Including: Investment incomes from joint ventures or associates 51,594,928.82 35,314,343.21
Income from derecognition of financial assets measured at amortization costs
Income from changes in fair value (losses expressed with "-") V. 60 -58,130,545.10 200,153,472.05
Credit impairment losses (losses expressed with "-") V. 61 -150,980,869.74 192,824,692.53
Asset impairment losses (losses expressed with "-") V. 62 -606,161,255.62 -466,270,321.67
Income from disposal of assets (losses expressed with "-") V. 63 6,212,295.19 2,945,975.01
III. Operating profit (losses expressed with "-") 26,677,365,292.00 26,043,517,837.70
Add: Non-operating revenues V. 64 154,321,776.87 287,160,721.97
Less: Non-operating expenses V. 65 28,449,570.30 21,741,130.88
IV. Total profit (total losses expressed with "-") 26,803,237,498.57 26,308,937,428.79
Less: Income tax expenses V. 66 3,971,343,865.68 4,029,695,233.52
V. Net profit (net loss expressed with "-") 22,831,893,632.89 22,279,242,195.27
(I) Classification by business sustainability
1. Continuous operating net profit (net loss expressed with "-") 22,831,895,323.32 22,279,523,503.64
2. Discontinued operation net profit (net loss expressed with "-") -1,690.43 -281,308.37
(II) Classification by ownership
1. Net profits attributable to shareholders of the parent company ("-" stands for net losses) 23,063,732,372.62 22,175,108,137.32
2. Minority shareholders' gains and losses ("-" stands for net losses) -231,838,739.73 104,134,057.95
VI. Net of tax of other comprehensive income V. 46 3,923,057,187.22 1,135,981,683.99
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
(I) Net of tax of other comprehensive income attributable shareholders of the parent company 3,922,893,977.40 1,135,768,214.34
1. Other comprehensive income which cannot be reclassified into profits and losses 3,977,359,915.54 1,242,966,688.50
(1) Changes arising from remeasurement of the defined benefit plan -12,391,783.00 -6,851,653.00
(2) Other comprehensive income which cannot be transferred to profit or loss under the equity method 1,849,833,156.32 215,136,201.85
(3) Changes in fair value of other equity instrument investments 2,139,918,542.22 1,034,682,139.65
(4) Changes in fair value of the company's own credit risk
(5) Others
2. Other comprehensive income which will be reclassified into profits and losses in the future -54,465,938.14 -107,198,474.16
(1) Other comprehensive income that can be transferred to profit or loss under the equity method -208,819.44 -182,758.17
(2) Changes in fair value of other debt investments -2,346,134.55 -1,862,050.54
(3) Amount of financial assets reclassified and included into other comprehensive income
(4) Provision for credit impairment of other debt investments
(5) Cash flow hedge reserve 6,966,706.25 13,739,102.50
(6) Difference arising from translation of financial statements in foreign currency -58,877,690.40 -118,892,767.95
(II) Net of tax of other comprehensive income attributable to minority shareholders 163,209.82 213,469.65
VII. Total comprehensive income 26,754,950,820.11 23,415,223,879.26
(I) Total comprehensive income attributable to shareholders of the parent company 26,986,626,350.02 23,310,876,351.66
(II) Total comprehensive income attributable to minority shareholders -231,675,529.91 104,347,527.60
VIII. Earnings per share:
(I) Basic earnings per share (Yuan per Share) 4.04 3.71
(II) Diluted earnings per share (Yuan per Share)
4.04 3.71
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Consolidated Cash Flow Statement
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note For the Year 2021 For the Year 2020
I. Cash flows from operating activities:
Cash received from sale of goods or rendering of services 169,646,517,565.79 155,890,384,313.86
Net increase in deposits and due from banks -78,563,388.63 -92,506,750.32
Net increase in borrowings from central bank
Net increase in placements from other financial institutions -700,000,000.00
Cash received from interests, fees and commissions 955,723,978.81 1,137,265,615.92
Net increase in placements from other financial institutions
Net increase in repurchase business capital 271,500,000.00 475,000,000.00
Refund of tax and levies 2,467,381,243.01 2,484,293,128.44
Other cash received relating to operating activities V 67. (1) 3,938,701,318.02 4,698,328,013.32
Subtotal of cash inflows from operating activities 177,201,260,717.00 163,892,764,321.22
Cash payments for goods acquired and services received 145,601,518,405.47 121,793,121,343.62
Net increase in loans and advances to customers -1,131,768,349.46 -9,091,377,401.54
Net increase in deposits with central bank and other financial institutions -633,908,556.69 -976,192,487.64
Net increase in lending funds
Cash paid for interests, fees and commissions 525,419,503.63 312,753,420.49
Cash paid to and on behalf of employees 9,848,593,392.99 8,901,277,136.77
Payments of all types of taxes 8,371,839,466.55 8,184,052,900.55
Other cash paid relating to operating activities V 67. (2) 12,725,203,595.79 15,530,492,099.81
Subtotal of cash outflows from operating activities 175,306,897,458.28 144,654,127,012.06
Net cash flows from operating activities 1,894,363,258.72 19,238,637,309.16
II. Cash flows from investing activities:
Cash received from recovery of investments 7,349,802,107.98 9,520,639,757.24
Cash received from return of investments 161,515,418.96 305,411,730.38
Net cash received from disposal of fixed assets, intangible assets and other long-term
14,956,809.63 6,631,829.54
assets
Net cash received from disposal of subsidiaries and other business units 13,498,800.00
Other cash received relating to investing activities V 67. (3) 47,851,587,196.05 4,322,649,440.42
Subtotal of cash inflows from investment activities 55,391,360,332.62 14,155,332,757.58
Cash paid for purchase and construction of fixed assets, intangible assets and other
5,727,074,800.44 4,528,646,805.03
long-term assets
Cash paid for investments 18,154,432,702.74 3,561,055,956.90
Net cash paid for acquisition of subsidiaries and other business units V 68. (2) 1,747,336,403.99 425,875,376.81
Other cash paid relating to investing activities V 67. (4) 10,532,866.10 5,542,024,468.66
Subtotal of cash outflows from investment activities 25,639,376,773.27 14,057,602,607.40
Net cash flows from investment activities 29,751,983,559.35 97,730,150.18
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III. Cash flows from financing activities:
Cash received from absorbing investment 45,113,614.81 14,670,000.00
Including: Cash received from minority shareholder investment by subsidiary 45,113,614.81 14,670,000.00
Cash received from borrowings 88,802,444,041.60 37,599,791,534.80
Other cash received relating to financing activities V 67. (5) 1,143,534,793.64
Subtotal of cash inflows from financing activities 89,991,092,450.05 37,614,461,534.80
Cash repayments of amounts borrowed 57,868,429,527.67 29,475,431,119.54
Cash paid for dividend and profit distribution or interest payment 17,546,695,095.00 14,236,014,439.83
Including: Dividends and profits paid to minority shareholders by subsidiaries 411,607,065.23
Other cash paid relating to financing activities V 67. (6) 39,906,551,717.86 15,014,513,473.63
Subtotal of cash outflows from financing activities 115,321,676,340.53 58,725,959,033.00
Net cash flow from financing activities -25,330,583,890.48 -21,111,497,498.20
IV. Effect of foreign exchange rate changes on cash and cash equivalents -589,068,807.74 -372,392,144.48
V. Net increase in cash and cash equivalents 5,726,694,119.85 -2,147,522,183.34
Add: Beginning balance of cash and cash equivalents 24,225,049,638.15 26,372,571,821.49
VI. Ending balance of cash and cash equivalents 29,951,743,758.00 24,225,049,638.15
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Consolidated Statement of Changes in Shareholders' Equity
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
For the year 2021
Equity attributable to the shareholders of the parent company
Item Other equity instruments Other Minority Equity total of the
Capital Less: Treasury Special Surplus General risk Undistributed
Capital stock Preferred Perpetual comprehensive Subtotal equity shareholders
Others reserves stock reserves reserve provisions profit
stock bond income
I. Ending balance for the
6,015,730,878.00 121,850,280.68 5,182,273,853.90 7,396,060,195.47 3,499,671,556.59 497,575,772.26 102,841,596,377.66 115,190,211,206.76 1,690,275,881.38 116,880,487,088.14
previous year
Add: Changes in
accounting policies
Early error
correction
Business
combination involving
enterprises under common
control
II. Beginning balance for
6,015,730,878.00 121,850,280.68 5,182,273,853.90 7,396,060,195.47 3,499,671,556.59 497,575,772.26 102,841,596,377.66 115,190,211,206.76 1,690,275,881.38 116,880,487,088.14
the current year
III. Increase or decrease in
the current year (decrease -101,261,838.00 4,023,846.88 14,397,372,379.53 3,807,944,159.80 22,403,846.26 -1,515,944,448.85 8,023,584.04 633,626,622.51 -11,538,556,606.89 2,583,520,685.26 -8,955,035,921.63
expressed with "-")
(I) Total comprehensive
3,922,893,977.40 23,063,732,372.62 26,986,626,350.02 -231,675,529.91 26,754,950,820.11
income
(II) Capital invested by
shareholders and capital -101,261,838.00 4,023,846.88 14,397,372,379.53 21,259,298.20 -3,499,671,556.59 -3,794,252,950.50 -21,767,275,579.54 2,864,813,072.60 -18,902,462,506.94
decrease
1. Ordinary stocks
49,331,294.00 49,331,294.00
invested by shareholders
2. Capital invested by
holders of other equity
3. Amounts of
share-based payments
31,002,910.71 31,002,910.71 31,002,910.71
recognized into shareholders'
equity
4. Others -101,261,838.00 -26,979,063.83 14,397,372,379.53 21,259,298.20 -3,499,671,556.59 -3,794,252,950.50 -21,798,278,490.25 2,815,481,778.60 -18,982,796,711.65
(III) Profit distribution 1,983,727,107.74 8,023,584.04 -18,744,282,186.78 -16,752,531,495.00 -49,903,893.39 -16,802,435,388.39
1. Appropriation to
1,983,727,107.74 -1,983,727,107.74
surplus reserves
2. Appropriation to
8,023,584.04 -8,023,584.04
general risk provisions
3. Allocation to
-16,752,531,495.00 -16,752,531,495.00 -49,903,893.39 -16,802,435,388.39
shareholders
4. Others
(IV) Internal carry-over of
-114,949,817.60 108,429,387.17 -6,520,430.43 -6,520,430.43
shareholders' equity
1. Transfer of capital
reserves into capital (or stock
capital)
2. Transfer of surplus
reserves into capital (or stock
capital)
3. Surplus reserves for
making up losses
4. Defined benefit
plan change carried over into
retained earnings
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
5. Other
comprehensive income
-114,949,817.60 108,429,387.17 -6,520,430.43 -6,520,430.43
carried forward to retained
earnings
6. Others
(V) Special reserves 1,144,548.06 1,144,548.06 287,035.96 1,431,584.02
1. Amount withdrawn
2,404,215.46 2,404,215.46 552,286.62 2,956,502.08
for the period
2. Amount used for
1,259,667.40 1,259,667.40 265,250.66 1,524,918.06
the period
(VI) Others
IV. Ending balance for the
5,914,469,040.00 125,874,127.56 19,579,646,233.43 11,204,004,355.27 22,403,846.26 1,983,727,107.74 505,599,356.30 103,475,223,000.17 103,651,654,599.87 4,273,796,566.64 107,925,451,166.51
current year
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Consolidated Statement of Changes in Shareholders’ Equity (Continued)
January to December in 2020
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
For the Year 2020
Equity attributable to shareholders of the parent company
Item Other equity instruments Other Equity total of the
Preferred Perpetual O thers Capital Less: Treasury Special Surplus General risk Undistributed Minority equity
Capital stock comprehensive Subtotal shareholders
stock bond reserves s tock income
reserve reserve provisions profit
I. Ending balance for the
6,015,730,878.00 93,379,500.71 6,260,291,981.13 3,499,671,556.59 489,855,826.75 93,794,643,539.49 110,153,573,282.67 1,894,083,240.41 112,047,656,523.08
previous year
Add: Changes in
accounting policies
Early error
correction
Business
combination involving
enterprises under common
control
II. Beginning balance for the
6,015,730,878.00 93,379,500.71 6,260,291,981.13 3,499,671,556.59 489,855,826.75 93,794,643,539.49 110,153,573,282.67 1,894,083,240.41 112,047,656,523.08
current year
III. Increase or decrease in
the current year (decrease 28,470,779.97 5,182,273,853.90 1,135,768,214.34 7,719,945.51 9,046,952,838.17 5,036,637,924.09 -203,807,359.03 4,832,830,565.06
expressed with “-”)
(I) Total comprehensive
1,135,768,214.34 22,175,108,137.32 23,310,876,351.66 104,347,527.60 23,415,223,879.26
income
(II) Capital invested by
shareholders and capital 2,966,412.88 5,182,273,853.90 -5,179,307,441.02 128,956,545.69 -5,050,350,895.33
decrease
1. Ordinary stocks
14,670,000.00 14,670,000.00
invested by shareholders
2. Capital invested by
holders of other equity
3. Amounts of
share-based payments
recognized into shareholders'
equity
4. Others 2,966,412.88 5,182,273,853.90 -5,179,307,441.02 114,286,545.69 -5,065,020,895.33
(III) Profit distribution 7,719,945.51 -13,148,143,215.11 -13,140,423,269.60 -411,607,065.23 -13,552,030,334.83
1. Appropriation to
surplus reserves
2. Appropriation to
7,719,945.51 -7,719,945.51
general risk provisions
3. Allocation to
-13,140,423,269.60 -13,140,423,269.60 -411,607,065.23 -13,552,030,334.83
shareholders
4. Others
(IV) Internal carry-over of
25,504,367.09 19,987,915.96 45,492,283.05 -25,504,367.09 19,987,915.96
shareholders' equity
1. Transfer of capital
reserves into capital (or stock
capital)
2. Transfer of surplus
reserves into capital (or stock
capital)
3. Surplus reserves for
making up losses
4. Defined benefit plan
change carried over into
retained earnings
5. Other comprehensive
income carried forward to 19,987,915.96 19,987,915.96 19,987,915.96
retained earnings
6. Others 25,504,367.09 25,504,367.09 -25,504,367.09
(V) Special reserves
1. Amount withdrawn
for the period
2. Amount used for the
period
(VI) Others
IV. Ending balance for the 5,182,273,853.90
6,015,730,878.00 121,850,280.68 7,396,060,195.47 3,499,671,556.59 497,575,772.26 102,841,596,377.66 115,190,211,206.76 1,690,275,881.38 116,880,487,088.14
current year
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Balance Sheet of Parent Company
December 31, 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note December 31, 2021 January 1, 2021 December 31, 2020
Current assets:
Monetary funds 100,413,441,304.10 123,828,677,860.41 123,828,677,860.41
Trading financial liabilities 370,820,500.00 370,820,500.00
Derivative financial assets 21,610,541.29 76,680,617.45 76,680,617.45
Bills receivable
Accounts receivable XIV. 1 3,685,619,949.29 3,548,791,695.27 3,548,791,695.27
Receivable financing 21,973,920,103.73 18,642,206,012.24 18,642,206,012.24
Advance payments 23,689,469,573.43 17,963,607,702.38 17,963,607,702.38
Other receivables XIV. 2 2,076,879,180.43 2,307,154,984.66 2,307,154,984.66
Including: Interests receivable
Dividends receivable 2,932,373.42 2,932,373.42
Inventory 10,215,532,982.28 13,884,110,379.81 13,884,110,379.81
Contract assets Not Applicable
Assets held for sale
Non-current assets due within one year 10,969,772,555.56
Other current assets 5,506,040,199.45 9,773,701,904.35 9,773,701,904.35
Total current assets 178,552,286,389.56 190,395,751,656.57 190,395,751,656.57
Non-current assets:
Debt investment
Other debt investments 5,182,465,277.78
Long-term receivables
Long-term equity investments XIV. 3 29,888,588,986.29 24,619,357,367.01 24,619,357,367.01
Other equity instruments investments 9,889,910,814.28 7,505,139,669.97 7,505,139,669.97
Other non-current financial assets 81,309,327.39 2,003,483,333.33 2,003,483,333.33
Investment real estate 19,871,480.80 22,173,605.79 22,173,605.79
Fixed assets 2,535,403,625.71 2,706,217,465.90 2,706,217,465.90
Construction in progress 907,483,903.01 570,077,306.55 570,077,306.55
Usufruct assets
Intangible assets 843,960,439.75 780,743,893.31 780,743,893.31
Development expenditures
Goodwill
Long-term unamortized expenses
Deferred income tax assets 10,730,613,644.43 10,926,393,867.16 10,926,393,867.16
Other non-current assets 86,616,430.09 97,653,134.61 97,653,134.61
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Total non-current assets 60,166,223,929.53 49,231,239,643.63 49,231,239,643.63
Total assets 238,718,510,319.09 239,626,991,300.20 239,626,991,300.20
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Balance Sheet of Parent Company (Continued)
December 31, 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
Item Note December 31, 2021 January 1, 2021 December 31, 2020
Current liabilities:
Short-term borrowings 18,068,823,304.24 15,862,663,592.40 15,862,663,592.40
Trading financial liabilities
Derivative financial liabilities
Notes payable 35,673,937,662.52 19,177,017,664.74 19,177,017,664.74
Accounts payable 33,677,905,272.50 44,365,200,963.00 44,365,200,963.00
Advances from customers
Contract liabilities 12,219,603,424.23 14,594,653,911.45 14,594,653,911.45
Employee pay payable 1,464,834,311.62 1,306,897,769.56 1,306,897,769.56
Taxes and dues payable 1,067,213,552.76 777,604,964.68 777,604,964.68
Other payables 2,470,038,943.73 1,773,107,761.34 1,773,107,761.34
Including: Interests payable
Dividends payable 602,881.87 602,881.87 602,881.87
Liabilities held for sale
Non-current liabilities due within one year 135,037,104.90
Other current liabilities 59,674,216,467.38 59,737,975,078.14 59,737,975,078.14
Total current liabilities 164,451,610,043.88 157,595,121,705.31 157,595,121,705.31
Non-current liabilities:
Long-term borrowings 6,606,444,166.67 143,254,262.42 143,254,262.42
Bonds payable
Including: Preferred stock
Perpetual bond
Lease liabilities
Long-term payables
Long-term payroll payable 164,408,471.00 149,859,788.00 149,859,788.00
Accrued liabilities
Deferred Income 85,326,589.00 74,814,702.48 74,814,702.48
Deferred income tax liabilities 1,291,446,408.46 848,906,843.68 848,906,843.68
Other non-current liabilities
Total non-current liabilities 8,147,625,635.13 1,216,835,596.58 1,216,835,596.58
Total liabilities 172,599,235,679.01 158,811,957,301.89 158,811,957,301.89
Shareholders’ equity:
Capital stock 5,914,469,040.00 6,015,730,878.00 6,015,730,878.00
Other equity instruments
Including: Preferred stock
Perpetual bond
Capital reserves 109,621,222.84 184,850,281.86 184,850,281.86
Less: Treasury stock 19,579,646,233.43 5,182,273,853.90 5,182,273,853.90
Other comprehensive income 11,663,015,593.78 7,763,409,043.86 7,763,409,043.86
Special reserve
Surplus reserve 1,983,727,107.74 3,497,114,024.31 3,497,114,024.31
Undistributed profit 66,028,087,909.15 68,536,203,624.18 68,536,203,624.18
Equity total of the shareholders 66,119,274,640.08 80,815,033,998.31 80,815,033,998.31
Total liabilities and shareholders' equity 238,718,510,319.09 239,626,991,300.20 239,626,991,300.20
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Income Statement of Parent Company
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF
Unit: Yuan
ZHUHAI
Item Note For the Year 2021 For the Year 2020
I. Operating revenues XIV. 4 117,502,214,959.15 107,841,790,174.49
Less: Operating Cost XIV. 4 84,576,440,398.57 76,008,352,345.28
Taxes and surcharges 268,607,695.48 174,392,631.24
Sales expense 9,733,828,322.47 11,169,691,825.61
Administrative expense 875,539,864.96 808,715,696.48
Research and development expenses 4,964,928,966.97 4,811,036,302.94
Financial expense -3,058,810,928.42 -2,919,245,870.62
Including: Interest expense 1,312,749,932.63 840,469,134.14
Interest revenue 4,719,654,050.92 4,434,457,504.91
Add: Other incomes 98,992,747.91 233,757,468.48
Income from investments (losses expressed with "-") XIV. 5 2,960,166,670.54 12,402,627,036.29
Including: Investment incomes from joint ventures or -12,905,170.50 -12,168,894.57
associates Income from derecognition of financial assets
measuredIncome from net costs hedging (losses expressed with
"-") Income from changes in fair value (losses expressed with "-") -57,612,527.32 56,685,742.93
Credit impairment losses (losses expressed with "-") 47,932,902.68 2,282,469.02
Asset impairment losses (losses expressed with "-") -482,109,320.46 -178,340,890.13
Income from disposal of assets (losses expressed with "-") 1,775,599.93 1,733,177.13
II. Operating profit (losses expressed with "-") 22,710,826,712.40 30,307,592,247.28
Add: Non-operating revenues 19,734,701.84 46,252,800.73
Less: Non-operating expenses 2,241,847.84 9,176,432.87
III. Total profit (total losses expressed with "-") 22,728,319,566.40 30,344,668,615.14
Less: Income tax expenses 2,891,048,488.98 2,659,156,932.61
IV. Net profit (net loss expressed with "-") 19,837,271,077.42 27,685,511,682.53
(I) Net profit from continuing operations (net loss expressed with 19,837,271,077.42 27,685,511,682.53
"-") (II) Net profit from discontinued operations (net loss expressed
withNet"-")of tax of other comprehensive income 4,014,556,367.52 1,301,384,947.45
(I) Other comprehensive income not to be reclassified to profit or 4,016,410,674.15 1,294,557,343.46
loss 1. Changes arising from remeasurement of the defined -12,391,783.00 -6,851,653.00
benefit plan2. Other comprehensive income which cannot be 1,849,833,156.32 215,136,201.85
transferred 3. Changes in fair value of other equity instrument 2,178,969,300.83 1,086,272,794.61
investments4. Changes in fair value of the company's own credit risk
5. Others
(II) Other comprehensive income to be reclassified to profit or -1,854,306.63 6,827,603.99
loss 1. Other comprehensive income that can be transferred to -182,758.17
profit or loss2. under the inequityvalue of other debt investments -8,821,012.88 -6,728,740.34
3. Amount of financial assets reclassified and included
into other comprehensiveforincome impairment of other debt
investments5. Cash flow hedge reserve 6,966,706.25 13,739,102.50
6. Difference arising from translation of financial
statements in foreign currency
VI. Total comprehensive income 23,851,827,444.94 28,986,896,629.98
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
Cash Flow Statements of Parent Company
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF
Unit: Yuan
ZHUHAI
Item Note For the Year 2021 For the Year 2020
I. Cash flows from operating activities:
Cash received from sale of goods or rendering of services 96,059,533,928.05 93,602,519,755.19
Refund of tax and levies 2,115,966,444.28 2,108,659,339.52
Other cash received relating to operating activities 50,710,080,340.57 35,640,698,959.97
Subtotal of cash inflows from operating activities 148,885,580,712.90 131,351,878,054.68
Cash payments for goods acquired and services received 116,836,791,145.16 88,931,239,009.32
Cash paid to and on behalf of employees 3,576,725,919.34 3,521,483,800.64
Payments of all types of taxes 4,278,081,434.78 3,915,413,842.97
Other cash paid relating to operating activities 18,436,681,133.15 18,625,111,285.52
Subtotal of cash outflows from operating activities 143,128,279,632.43 114,993,247,938.45
Net cash flows from operating activities 5,757,301,080.47 16,358,630,116.23
II. Cash flows from investing activities:
Cash received from recovery of investments 7,204,261,026.83 1,154,839,757.24
Cash received from return of investments 93,574,837.20 3,616,084,603.45
Net cash received from disposal of fixed assets, intangible assets and 668,332.00 2,552,696.74
otherNet cash received from disposal of subsidiaries and other business
units Other cash received relating to investing activities 44,645,766,820.10 5,376,248,383.05
Subtotal of cash inflows from investment activities 51,944,271,016.13 10,149,725,440.48
Cash paid for purchase and construction of fixed assets, intangible 791,819,639.99 806,766,396.66
assetsCash paid forlong-term assets 19,474,047,673.02 6,623,118,162.38
Net cash paid for acquisition of subsidiaries and other business units 1,828,275,113.56 150,000,000.00
Other cash paid relating to investing activities 1,693,811,425.80 8,155,280,838.65
Subtotal of cash outflows from investment activities 23,787,953,852.37 15,735,165,397.69
Net cash flows from investment activities 28,156,317,163.76 -5,585,439,957.21
III. Cash flows from financing activities:
Cash received from absorbing investment
Cash received from borrowings 63,139,445,175.64 29,395,517,581.94
Other cash received relating to financing activities 2,441,352,006.04 878,448,565.19
Subtotal of cash inflows from financing activities 65,580,797,181.68 30,273,966,147.13
Cash repayments of amounts borrowed 50,350,925,464.00 24,568,052,850.00
Cash paid for dividend and profit distribution or interest payment 17,449,330,238.22 13,662,321,384.07
Other cash paid relating to financing activities 28,618,739,788.45 15,508,240,629.89
Subtotal of cash outflows from financing activities 96,418,995,490.67 53,738,614,863.96
Net cash flow from financing activities -30,838,198,308.99 -23,464,648,716.83
IV. Effect of foreign exchange rate changes on cash and cash -228,723,815.38 -548,526,629.60
equivalents in cash and cash equivalents 2,846,696,119.86 -13,239,985,187.41
Add: Beginning balance of cash and cash equivalents 17,119,780,780.05 30,359,765,967.46
VI. Ending balance of cash and cash equivalents 19,966,476,899.91 17,119,780,780.05
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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Statement of Changes in Shareholders’ Equity of Parent Company
January to December in 2021
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
For the year 2021
Other equity instruments
Item Capital Other comprehensive Special Undistributed Equity total of the
Capital stock Preferred Perpetual Less: Treasury stock Surplus reserve
Others reserves income reserve profit shareholders
stock bond
I. Ending balance for the previous year 6,015,730,878.00 184,850,281.86 5,182,273,853.90 7,763,409,043.86 3,497,114,024.31 68,536,203,624.18 80,815,033,998.31
Add: Changes in accounting policies
Early error correction
Others
II. Beginning balance for the current year 6,015,730,878.00 184,850,281.86 5,182,273,853.90 7,763,409,043.86 3,497,114,024.31 68,536,203,624.18 80,815,033,998.31
III. Increase or decrease in the current year (decrease
-101,261,838.00 -75,229,059.02 14,397,372,379.53 3,899,606,549.92 -1,513,386,916.57 -2,508,115,715.03 -14,695,759,358.23
expressed with “-”)
(I) Total comprehensive income 4,014,556,367.52 19,837,271,077.42 23,851,827,444.94
(II) Capital invested by shareholders and capital decrease -101,261,838.00 -75,229,059.02 14,397,372,379.53 -3,497,114,024.31 -3,717,557,576.88 -21,788,534,877.74
1. Ordinary stocks invested by shareholders
2. Capital invested by holders of other equity
3. Amounts of share-based payments recognized into
31,002,910.71 31,002,910.71
shareholders' equity
4. Others -101,261,838.00 -106,231,969.73 14,397,372,379.53 -3,497,114,024.31 -3,717,557,576.88 -21,819,537,788.45
(III) Profit distribution 1,983,727,107.74 -18,736,258,602.74 -16,752,531,495.00
1. Appropriation to surplus reserves 1,983,727,107.74 -1,983,727,107.74
2. Allocation to shareholders -16,752,531,495.00 -16,752,531,495.00
3. Others
(IV) Internal carry-over of shareholders' equity -114,949,817.60 108,429,387.17 -6,520,430.43
1. Transfer of capital reserves into capital (or stock capital)
2. Transfer of surplus reserves into capital (or stock capital)
3. Surplus reserves for making up losses
4. Defined benefit plan change carried over into retained
earnings
5. Other comprehensive income carried forward to retained
-114,949,817.60 108,429,387.17 -6,520,430.43
earnings
6. Others
(V) Special reserves
1. Amount withdrawn for the period
2. Amount used for the period
(VI) Others
IV. Ending balance for the current year 5,914,469,040.00 109,621,222.84 19,579,646,233.43 11,663,015,593.78 1,983,727,107.74 66,028,087,909.15 66,119,274,640.08
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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Statement of Changes in Shareholders’ Equity of Parent Company (Continued)
January to December in 2020
Prepared by: GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI Unit: Yuan
For the Year 2020
Other equity instruments
Item Capital Less: Treasury Other comprehensive Special Undistributed Equity total of the
Capital stock Preferred Perpetual Surplus reserve
Others reserves stock income reserve profit shareholders
stock bond
I. Ending balance for the previous year 6,015,730,878.00 179,564,695.55 6,462,024,096.41 3,497,114,024.31 53,971,127,295.29 70,125,560,989.56
Add: Changes in accounting policies
Early error correction
Others
II. Beginning balance for the current year 6,015,730,878.00 179,564,695.55 6,462,024,096.41 3,497,114,024.31 53,971,127,295.29 70,125,560,989.56
III. Increase or decrease in the current year (decrease
5,285,586.31 5,182,273,853.90 1,301,384,947.45 14,565,076,328.89 10,689,473,008.75
expressed with “-”)
(I) Total comprehensive income 1,301,384,947.45 27,685,511,682.53 28,986,896,629.98
(II) Capital invested by shareholders and capital decrease 5,285,586.31 5,182,273,853.90 -5,176,988,267.59
1. Ordinary stocks invested by shareholders
2. Capital invested by holders of other equity
3. Amounts of share-based payments recognized into
shareholders' equity
4. Others 5,285,586.31 5,182,273,853.90 -5,176,988,267.59
(III) Profit distribution -13,140,423,269.60 -13,140,423,269.60
1. Appropriation to surplus reserves
2. Allocation to shareholders -13,140,423,269.60 -13,140,423,269.60
3. Others
(IV) Internal carry-over of shareholders' equity 19,987,915.96 19,987,915.96
1. Transfer of capital reserves into capital (or stock
capital)
2. Transfer of surplus reserves into capital (or stock
capital)
3. Surplus reserves for making up losses
4. Defined benefit plan change carried over into retained
earnings
5. Other comprehensive income carried forward to
19,987,915.96 19,987,915.96
retained earnings
6. Others
(V) Special reserves
1. Amount withdrawn for the period
2. Amount used for the period
(VI) Others
IV. Ending balance for the current year 6,015,730,878.00 184,850,281.86 5,182,273,853.90 7,763,409,043.86 3,497,114,024.31 68,536,203,624.18 80,815,033,998.31
Legal Representative: Dong Mingzhu Chief Accountant: Liao Jianxiong Head of Accounting Department: Liu Yanzi
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
Notes Financial Statements for the Year 2021
Ⅰ Basic information of the Company
Gree Electric Appliances, Inc. of Zhuhai (hereinafter referred to as "the Company") was established in
December 1989, with the unified social credit code 91440400192548256N.
The registered capital and equity of the Company was RMB 5,914,469,040.00 by the end of December 31, 2021.
For the specific equity, see Note (V) 43 "Equity".
1. Registered address, organizational form and address of the Company
Organizational form of the Company: joint stock limited company
The Company's registration place and office address: Office 608, No. 108, Huitong Third Road, Hengqin New
Area, Zhuhai City, Guangdong Province.
2. Nature of business and main business activities of the Company
The Company is a manufacturing enterprise mainly engaging in the production and sales of air-conditioners and
their accessories and home appliances and their accessories.
3. Names of the parent company and the ultimate parent company
As of December 31, 2021, the Company had no actual controller.
4. Scope of consolidated financial statements of the current period and its change
As of the end of the report period, there were a total of 156 subsidiaries included in the scope of the consolidated
financial statements. Among them, please see Note VII. 1 "Rights and interests in the subsidiary" for first-level
subsidiaries and Note VI "Changes in the consolidation scope" for the changes in the scope of consolidated financial
statements in this period.
5. Approved submitter and approved submission date of the financial report
This financial report was submitted under approval the Board of Directors of the Company as of April 29, 2022.
Ⅱ Preparation basis of financial statements
1. Preparation basis of financial statements
The Company prepares the financial statements on the basis of a going concern and according to the transactions
and events actually incurred and the disclosure provisions in the Accounting Standards for Business Enterprises -
Basic Standards (promulgated by the Ministry of Finance Order No. 33, revised by the Ministry of Finance Order
No.76) and the specific accounting standards, the Implementation Guide for the Accounting Standards for Business
Enterprises, the Interpretations of the Accounting Standards for Business Enterprises and other applicable regulations
promulgated and revised by the Ministry of Finance on and after February 15, 2006 (collectively referred to as the
"Accounting Standards for Business Enterprises"), as well as the Preparation Rules for Information Disclosure by
Companies Offering Securities to the Public No. 15 - General Provisions on Financial Reports (2014 Revision)
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
promulgated by China Securities Regulatory Commission ("CSRC"). According to the relevant provisions of the
Enterprise Accounting Standards, the Company's accounting is based on the accrual basis. Except for certain
financial instruments, the financial statements are measured on the basis of historical cost. If an asset is impaired, the
corresponding impairment provision shall be made in accordance with relevant regulations.
According to the relevant provisions of the Enterprise Accounting Standards, the Company's accounting is based
on the accrual basis. Except for certain financial instruments, the financial statements are measured on the basis of
historical cost. If an asset is impaired, the corresponding impairment provision shall be made in accordance with
relevant regulations.
2. Going concern
This financial statement was presented on a going concern basis. The management carefully evaluated factors of
the Company in the future 12 months commencing from December 31, 2021 such as the macropolicy risk, market
operation risk, current and long-term profitability and solvency of the enterprise, financial flexibility, and the
management's intention of changing the operation policy, and held that there was no event that can generate
significant influence on the Company's ability to continue as a going concern.
Ⅲ Major accounting policies and accounting estimates
Specific accounting policies and accounting estimate suggestions:
The Company and each subsidiary are mainly engaged in production and sales of air-conditioners and their
accessories, and domestic appliances and their accessories. The Company has prepared several specific accounting
policies and accounting estimates for transactions and events such as revenue recognition based on the actual
production management characteristics and in accordance with provisions of the related Accounting Standards for
Business Enterprises. For details, see the detailed description in Note III herein.
1. Statements regarding observance of the Accounting Standards for Business Enterprises
The financial statements prepared by the Company conform to the requirements of the Accounting Standards for
Business Enterprises and give a true and complete view of the financial position of the Company on December 31,
2021, and the related information such as operating results and cash flows in the year 2021. Besides, the financial
statements prepared by the Company, in all the major aspects, also conform to the disclosure requirements of
financial statements and their notes in the Preparation Rules for Information Disclosure by Companies Offering
Securities to the Public No. 15 - General Provisions on Financial Reports revised by the China Securities Regulatory
Commission in 2014.
2. Accounting period
Accounting period of the Company includes one year and interim periods. An interim period covers six-month, a
quarter and a month. The accounting year of the Company commences on January 1 and ends on December 31 of
each year.
3. Operating cycle
The normal operating cycle refers to the period from the Company's purchase of assets used for processing to
achieving of cash or cash equivalent. The Company regards 12 months as one operating cycle and uses it as the
liquidity classification standard for assets and liabilities.
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
4. Functional currency
RMB is the functional currency used by the Company. Some subsidiaries of the Company adopt currencies other
than Renminbi as the functional currency.
5. Accounting treatment of business combination involving enterprises under common control and business
combination not involving enterprises under common control
Business combination refers to the transaction or event of combining two or more independent enterprises to
form a reporting entity. Business combination is classified into business combination involving enterprises under
common control and business combination not involving enterprises under common control.
(1) Business combination under common control
A business combination under common control is a business combination in which the enterprises participating
in the combination are ultimately controlled by the same party or parties before and after the combination, and the
control is not temporary. For business combination involving enterprises under common control, the party that
obtains the right to control other enterprises participating in the combination on the combination date is the
combining party, and other enterprises participating in the combination are the combined party. The combination date
refers to the date on which the combining party actually obtains the right to control the combined party.
Where business combination involving enterprises under common control arises from one transaction or equities
of invested entities under common control are obtained step by step through multiple transactions and these
transactions belong to a package deal, the Company will recognize the cost of combination according to the share of
carrying amount of net assets obtained for the combined party in the ultimate controlling party's consolidated
financial statements on the combination date. The difference between the carrying amount of the consideration paid
for the combination (or total par value of the issued stocks) and the combination cost is adjusted to capital reserve; if
the capital reserve is not sufficient to absorb the difference, any excess is adjusted against retained earnings.
Costs incurred that are attributable to the business combination made by the Company, including intermediary
costs such as the audit fee, legal service charge and appraisal and consultation costs, and other related overhead
expenses are charged to profits or losses in the period in which they are incurred; the transaction expenses directly
attributable to the consideration paid for the combination through issuance of equity instruments are credited against
the capital reserve; if the capital reserve is not sufficient, any excess is adjusted against retained earnings; the
transaction expenses directly attributable to the consideration paid for the combination through issuance of debt
instruments are recorded into the initially recognized amount of debt instruments. Where the equities of invested
entities under common control are obtained step by step through multiple transactions to achieve business
combination but these transactions do not belong to a package deal, the Company will recognize the cost of
combination according to the share of carrying amount of net assets to be enjoyed by the combined party after the
combination in the ultimate controlling party's consolidated financial statements on the combination date. The
difference between the combination cost and the sum of the carrying amount of long-term equity investments prior to
the combination plus the carrying amount of the consideration newly paid for further acquisition of shares on the date
of combination is adjusted to capital reserve (capital premium or capital stock premium); if the capital reserve is not
sufficient to absorb the difference, any excess is adjusted against retained earnings. For the equity investment held
before the date of combination, accounting treatment is not performed temporarily for other comprehensive incomes
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that are accounted using the equity method or recognized using financial instruments and accounted according to the
measurement standard for recognition. When this investment is disposed of, accounting treatment is conducted using
the basis the same as that used by the invested entity to directly dispose of relevant assets or liabilities. For other
changes in owners' equities other than the net profits/losses, other comprehensive income and profit distribution in
net assets of the invested entity that are recognized because of accounting using the equity method, accounting
treatment is not conducted temporarily; they shall be transferred to the profits and losses of the current period at the
time of disposing of this investment.
(2) Business combination not under common control
A business combination not involving enterprises under common control is a business combination in which all
of combining enterprises are not ultimately controlled by the same party or parties both before and after the
combination. For business combination not involving enterprises under common control, the party that obtains the
right to control other enterprises participating in the combination on the date of combination is the acquiring party,
and other enterprises participating in the combination are the acquired party. The date of acquisition refers to the date
on which the acquiring party actually obtains the right to control the acquired party.
For the business combination implemented through one transaction, the cost of business combination refers to
the fair value of assets paid, liabilities incurred or assumed and equity securities issued by the Company on the date
of acquisition for obtaining the right to control the acquired party. On the date of acquisition, the assets, liabilities and
contingent liabilities obtained by the Company from the acquired party are recognized at the fair value.
For a business combination realized by two or more transactions of exchange, the accounting treatment for the
combination costs shall be made by distinguishing individual financial statements and consolidated financial
statements:
In the individual financial statements, where the held stocks are accounted using the equity method prior to the
date of acquisition, the cost of combination of the investment is the aggregate of the carrying amount of the equity
investment of the acquired party held before the date of acquisition and the investment cost newly increased on the
date of acquisition. For other related comprehensive income, accounting treatment is performed during disposal of the
investment using the basis the same as that used by the invested entity to directly dispose of relevant assets or
liabilities; the owner's equity that is recognized due to other changes in owners' equities other than the net
profits/losses, other comprehensive income and profit distribution of the invested entity is accordingly transferred to
the profits and losses of the current period at the time of disposing of this investment. Where the equity investment
held before the date of acquisition is recognized using financial instruments and undergoes accounting treatment
according to the measurement standard, the cost of combination of the investment is the aggregate of the fair value of
the equity investment recognized according to this standard and the newly increased investment cost. The difference
between the fair value of the originally held stocks and the carrying amount and all the cumulative fair value changes
originally recorded into other comprehensive income are transferred to the investment income of the current period.
In the consolidated financial statements, the stocks of the acquired party held before the date of acquisition shall
be remeasured based on the fair value of such stocks on the date of acquisition, and the difference between their fair
value and carrying amount shall be charged to the investment income of the current period; where the stocks of the
acquired party held before the date of acquisition involve other comprehensive income under accounting of the equity
method and other changes in owners' equities other than the net profits/losses, other comprehensive income and profit
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distribution, other comprehensive income and other changes in owners' equities concerned with them shall be
transferred to the investment income in the period in which the date of acquisition is included (excluding other
comprehensive income arising from changes in the net assets or net liabilities of the benefit plan remeasured and
redefined by the invested entity). The summation of the fair value of the stocks of the acquired party held before the
date of acquisition on the date of acquisition and newly increased investment costs on the date of acquisition shall be
the combination cost of the investment.
Costs incurred that are attributable to the business combination made by the Company, including intermediary
costs such as the audit fee, legal service charge, and appraisal and consultation costs, and other related overhead
expenses are charged to profits or losses in the period in which they are incurred. The transaction expenses directly
attributable to the consideration paid for the combination through issuance of equity instruments are credited against
the capital reserve; if the capital reserve is not sufficient, any excess is adjusted against retained earnings; the
transaction expenses directly attributable to the consideration paid for the combination through issuance of debt
instruments are recorded into the initially recognized amount of debt instruments.
In the Company, the positive balance between the business combination cost and the fair value of the
identifiable net assets obtained by the Company from the acquired party shall be recognized as goodwill and
subsequently measured after the accumulated provision for impairment is deducted from the cost; the negative
balance between the business combination cost and the fair value of the identifiable net assets obtained by the
Company from the acquired party shall be charged to profits or losses of the current period after being checked.
(3) Principle of judging whether multiple transactions are "a package deal"
When the terms and conditions of multiple transactions and the economic impact thereof accord with one or
more of the following cases, usually it indicates that these transactions shall undergo accounting treatment as "a
package deal":
1) These transactions are concluded at the same time or concluded in consideration of mutual influence;
2) Only the whole of these transactions can achieve a complete business result;
3) Occurrence of one transaction depends on occurrence of at least one of the other transactions;
4) One transaction is not economical when considered separately, but economical when taken into account
together with other transactions.
6. Preparation of consolidated financial statements
(1) Principles for determining the scope of consolidated financial statements
The consolidation scope of consolidated financial statements shall be determined on the basis of control. Control
means that the Company owns the power to the invested entity, enjoys variable return by participating relevant
activities of the invested entity, and has the capacity of using the power to the invested entity to affect its return
amount.
(2) Preparation of consolidated financial statements
The consolidated financial statements of the Company are prepared by the Company based on individual
financial statements of the Company and subsidiaries and according to other relevant data. During preparation of
consolidated financial statements, the accounting policy and accounting period of the Company shall be consistent
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
with those of subsidiaries, and the inter-company major transactions and balances shall be offset.
For the subsidiary added due to business combination involving enterprises under common control in the Report
Period, the Company adjusts the amount at the beginning of the period in the consolidated balance sheet, incorporates
the revenue, expense and profit of this subsidiary from the beginning of the period for consolidation to the end of the
report period into the consolidated profit statement, includes its cash flow into the consolidated cash flow statement,
and adjusts relevant items in the comparative statements; for the subsidiary added due to business combination not
involving enterprises under common control, the Company does not adjust the amount at the beginning of the period
in the consolidated balance sheet, but only incorporates the revenue, expense and profit of this subsidiary from the
date of acquisition to the end of report period into the consolidated profit statement and its cash flow into the
consolidated cash flow statement.
The portion of owners' equity of the subsidiaries that isn't attributable to the Company shall be separately
presented as the minority shareholders' equity under the owners' equity in the consolidated balance sheet. The share
of comprehensive income of the subsidiaries in the current period that is attributable to the minority shareholders'
equity shall be presented as the item of "Total comprehensive income attributable to minority shareholders" under the
total comprehensive income in the consolidated profit statement. The share of comprehensive income of the
subsidiaries in the current period that is attributable to the minority shareholders' equity shall be presented as the item
of "Total comprehensive income attributable to minority shareholders" under the total comprehensive income in the
consolidated profit statement. Where the losses of a subsidiary undertaken by minority shareholders exceed the share
enjoyed by minority shareholders in the owners' equities of this subsidiary at the beginning of the period, the balance
shall be still adjusted against the minority shareholders' equity.
For acquisition of the subsidiary's stocks owned by minority shareholders thereof, in the consolidated financial
statements, the difference between the long-term equity investment newly obtained because of acquisition of minority
shareholders' stocks and the share of net assets of the subsidiary to be enjoyed and continuously calculated according
to the proportion of newly added shares from the acquisition date or consolidation date is adjusted to capital reserve;
if the capital reserve is not sufficient to absorb the difference, any excess is adjusted against retained earnings.
For the transaction for which a part of equity investment is disposed of but the right to control this subsidiary is
not lost, in the consolidated financial statements, the difference between the disposal price and the share of net assets
of the subsidiary to be enjoyed accordingly for disposal of the long-term equity investment and continuously
calculated from the acquisition date or consolidation date is adjusted to capital reserve (capital premium or capital
stock premium); if the capital reserve is not sufficient to absorb the difference, any excess is adjusted against retained
earnings.
Where the right to control the original subsidiary is lost due to disposal of a part of equity investment or other
reasons, the remaining stocks shall be remeasured at their fair value on the date of losing the control right; the result
of the sum of the consideration obtained from the equity disposal plus the fair value of remaining stocks, minus the
share of net assets of the original subsidiary that should be enjoyed and is continuously calculated according to the
original proportion of held shares from the acquisition date, shall be charged to the investment income in the period
when the control right is lost, and adjusted against the goodwill at the same time; other comprehensive income related
to the original subsidiary's equity investment shall be transferred to the investment income of the current period when
the control right is lost.
Where the equity investment for a subsidiary is disposed of step by step through multiple transactions till the
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2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
control right is lost and all the transactions belong to a package deal, accounting treatment shall be performed for the
transactions by deeming all the transactions as one item for disposing of the subsidiary and losing the control right;
however, prior to loss of the control right, the difference between every disposal price and the share of net assets of
this subsidiary to be enjoyed accordingly for investment disposal shall be recognized as other comprehensive income
in the consolidated financial statements and, at the time of losing the control right, be jointly transferred to the profits
or losses in the period when the control right is lost.
Where the equity investment for a subsidiary is disposed of step by step through multiple transactions till the
control right is lost and the transactions do not belong to a package deal, all the transactions before loss of the right to
control the subsidiary shall be handled according to the regulations of the Company on partial disposal of the
subsidiary's long-term equity investment provided that the Company does not lose the right to control the subsidiary.
This report period does not involve buying-in and selling-out of the same subsidiary's stocks, or selling-out and
buying-in turn.
7. Classification of joint arrangements and accounting treatment of co-management
Joint arrangement refers to the arrangement for joint control by two or more participants.
(1) Joint arrangement classification
Joint arrangement is classified into co-management and joint venture. Co-management refers to the joint
arrangement where the parties to the venture enjoy relevant assets of this arrangement and assume relevant liabilities
of this arrangement. Joint venture refers to the joint arrangement where the parties to the venture only enjoy rights to
net assets of this arrangement.
(2) Accounting treatment of co-management
1) The Company recognizes the following items related to quantum of interest in co-management and performs
accounting treatment in accordance with provisions of the corresponding Accounting Standards for Business
Enterprises:
a. Independently held assets, as well as the jointly held assets to be recognized according to the share of the
Company;
b. Independently undertaken liabilities, as well as the jointly undertaken liabilities to be recognized according to
the share of the Company;
c. Revenue generated by selling the output share of co-management that is enjoyed by the Company;
d. Revenue that is generated by selling the output during co-management and recognized according to the share
of the Company;
e. Independently incurred expense, as well as the expense incurred by co-management and recognized according
to the share of the Company.
2) Where the Company puts assets into or sells assets to the parties to co-management (except that the assets
constitute business), before the said assets are sold to a third party by the parties to co-management, the
Company recognizes only the part in the profits or losses arising from this transaction that is attributable to other
participants in the co-management. In case that the put or sold assets involve the asset impairment loss
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complying with provisions in the Accounting Standards for Business Enterprises No. 8 - Impairment of Assets,
the Company shall recognize the said loss in full.
3) Where the Company purchases assets from the parties to co-management (except that the assets
constitute business), before said assets are sold to a third party, the Company recognizes only the part in the
profits or losses arising from this transaction that is attributable to other participants in the co-management. In
case that the purchased assets involve the asset impairment loss complying with provisions in the Accounting
Standards for Business Enterprises No. 8 - Impairment of Assets, the Company shall recognize this part of loss
according to the share to undertake.
8. Criteria for cash and cash equivalents
The cash refers to the enterprise's money on hand and deposits for payment at any time. Cash equivalents refer
to investments held by the enterprise which are short in term (generally referring to those expiring within not more
than 3 months from the date of acquisition), high in liquidity, convertible to the known amount of cash and
insignificant in risk of change of value.
9. Foreign currency transactions and translation of financial statements in foreign currency
(1) Method of translation for foreign currency transactions
At the time of initial recognition of a foreign currency transaction of the Company, the amount in the foreign
currency shall be translated into the amount in RMB currency at the spot exchange rate of the transaction date
(generally referring to the medial rate of foreign exchange quotation published by the People's Bank of China at the
date of transaction, the same below).
(2) Treatment of monetary items of foreign currencies and non-monetary items of foreign currencies on the
balance sheet date
For the monetary items of foreign currencies, the translation is done according to spot rate of the balance sheet
date. The exchange difference generated from the difference of spot rate of the current balance sheet date and the
time of initial recognition of a foreign currency or the previous balance sheet date is charged to the profit or loss of
the current period except that the exchange difference generated from foreign currency borrowings relating to assets
of which the acquisition or production satisfies the capitalization conditions is capitalized in accordance with the
Accounting Standards for Business Enterprises No. 17 - Borrowing Costs. For the non-monetary items of foreign
currencies measured by historical cost, translation is done according to spot rate of the transaction date without
change in their amount in functional currency. Non-monetary items of foreign currencies such as stocks and funds
measured at their fair value are translated as per the spot rate on the date when their fair value is confirmed. The
differences between the translated amounts in functional currency and the original amounts in functional currency are
recorded into current profits and losses as fluctuation in fair value (including fluctuation in exchange rates).
(3) Translation of foreign currency financial statements
The Company translates the financial statements expressed in foreign currency into ones expressed in RMB
currency according to the following provisions.
The assets and liabilities in the balance sheet shall be converted at the spot exchange rate on the balance sheet
date, except for the "undistributed profit" item, other items of owners' equity are converted at the spot exchange rate
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at the time of occurrence. The asset and liability items in the balance sheets shall be translated at an average exchange
rate. The balance arisen from the translation of foreign currency financial statements in compliance with the aforesaid
method shall be presented separately under the owners' equity item of the balance sheets. The foreign currency cash
flow statement shall be translated at the average exchange rate on the cash flow date. The amount of influence of the
exchange rate change on cashes shall be presented separately under the adjusted item in the cash flow statement.
10. Financial instruments
A financial asset or financial liability can be recognized when the Company becomes one party of financial
instrument contract.
(1) Classification, recognition, and measurement of financial assets
According to the business mode for management of the financial assets and the characteristics of the contractual
cash flows of the financial assets, the Company classifies the financial assets into those measured at amortized cost,
those measured at fair value with changes included in the comprehensive income, and those measured at fair value
with changes included in the current profits and losses.
The financial assets initially recognized by the Company shall be measured at their fair values. For the financial
assets which are measured at their fair values and of which the changes are included into the current profits and losses,
the transaction expenses thereof are directly included into the current profits and losses; for other categories of
financial assets, the transaction expenses thereof are included into the initially recognized amount. For the accounts
receivable or notes receivable arising from the sale of products or the provision of services that do not contain or do
not consider significant financing components, the Company shall use the amount of consideration expected to be
entitled to be charged as the initial confirmation amount.
1) Financial assets measured at amortization costs
The Company's business model for managing financial assets measured at amortization cost is to collect
contractual cash flows, and the contractual cash flow characteristics of such financial assets are consistent with basic
borrowing arrangements, that is, cash flows generated on a specific date, are for the payment of principal and interest
based on the outstanding principal amount. The Company adopts the effective interest rate method for such financial
assets and performs subsequent measurement based on amortization cost. The gains or losses arising from their
amortization or impairment are included into the current profits and losses.
2) Financial assets measured at fair value with changes included in other comprehensive income
GDG's business model for managing such financial assets aims at collection of contractual cash flows and sales,
and the contractual cash flow characteristics of such financial assets are consistent with the basic lending
arrangements. The Company measures such financial assets at fair value and includes the changes of fair value are
included in other comprehensive income, but impairment losses or gains, exchange gains and losses and interest
income calculated according to the actual interest rate method are included into the current profits and losses.
In addition, the Company designates some non-trading equity instrument investments as financial assets which
are measured at their fair values and of which the changes are included into other comprehensive income. The
Company includes the relevant dividend income of such financial assets into the current profits and losses, and
includes the changes of fair value in other comprehensive income. When the financial assets are derecognized, the
cumulative gains or losses previously included into other comprehensive income will be transferred from other
comprehensive income to retained income, but will not be included into the current profits and losses.
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3) Financial assets which are measured at their fair values and of which the changes are included into other
comprehensive income
The Company classifies the financial assets other than the above financial assets measured at amortization cost
and financial assets which are measured at their fair values and of which the changes are included into other
comprehensive income as financial assets which are measured at their fair values and of which the changes are
included into the current profits and losses. In addition, in the initial recognition, in order to eliminate or significantly
reduce the accounting mismatch, the Company designates some financial assets as financial assets which are
measured at fair value and of which the changes are included into the current profits and losses. For such financial
assets, the Company uses fair value for subsequent measurement, and the changes of fair value are included in the
current profits and losses.
(2) Classification, recognition, and measurement of financial liabilities
Financial liabilities are initially classified as financial liabilities which are measured at fair value and of which
the changes are included in the current profits or losses and other financial liabilities. For the financial liabilities
which are measured at their fair values and of which the changes are included into the current profits and losses, the
transaction expenses thereof are directly included into the current profits and losses; for other financial liabilities, the
transaction expenses thereof are included into the initially recognized amount.
1) Financial liabilities measured at their fair values and of which the changes are recorded into the current profits
and losses
Financial liabilities which are measured at fair value and of which the changes are included in the current profits
or losses include trading financial liabilities (including derivatives that are financial liabilities) and financial liabilities
designated as those which are measured at fair value at the initial recognition and of which changes are included in
the current profits or losses.
Trading financial liabilities (including derivatives that are financial liabilities) are subsequently measured at fair
value. Except for hedge accounting, the changes in fair value are included in current profits or losses.
For financial liabilities designated as those which are measured at fair value at the initial recognition and of
which changes are included in the current profits or losses, the changes of fair value caused by changes in the
Company's own credit risk are included in other comprehensive income, and when the recognition of the liabilities is
terminated, the cumulative changes in fair value caused by changes in own credit risk included in other
comprehensive income are transferred to retained earnings. Other changes in fair value are included in current profits
or losses. If the accounting mismatch in profits and losses may be caused or expanded as the effects of changes in the
own credit risk of such financial liabilities are processed in the above manner, the Company will include all gains or
losses of such financial liabilities (including the amount affected by changes in the Company's own credit risk)
included in the current profit and loss.
2) Other financial liabilities
Except for the transfer of financial assets that does not meet the conditions for derecognition or continued
involvement in the financial liabilities and financial guarantee contracts formed by the transferred financial assets,
other financial liabilities are classified as financial liabilities measured at amortization cost, which are subsequently
measured at amortization cost. Gains or losses arising from derecognition or amortization are included in the current
profits and losses.
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(3) Basis for the recognition and method for the measurement of financial assets
Financial assets that meet one of the following conditions shall be derecognized:
1) The contract right to receive the cash flow of the financial assets is terminated;
2) The financial assets have been transferred, and almost all the risks and rewards of ownership of the financial
assets are transferred to the transferring party;
3) The financial assets have been transferred, although the enterprise has neither transferred nor retained almost
all the risks and rewards of the ownership of the financial assets, it has given up control over the financial assets.
If the enterprise has neither transferred nor retained almost all the risks and rewards of the ownership of the
financial assets, and has not given up control over the financial assets, the relevant financial assets shall be
recognized according to the extent of continued involvement in the transferred financial assets, and the relevant
liabilities shall be recognized accordingly. The extent of continued involvement in the transferred financial assets
refers to the level of risk that the changes in the value of the financial assets expose the enterprise to.
If the overall transfer of financial assets meets the conditions for derecognition, the difference between the book
value of the transferred financial assets and the sum of the consideration received due to the transfer and the
cumulative amount of changes in fair value originally included in other comprehensive income is included in the
current profits and losses.
If the partial transfer of financial assets satisfies the conditions for derecognition, the book value of the
transferred financial assets will be apportioned between the portion derecognized and the portion not derecognized
according to their relative fair values, and the difference between the sum of the consideration received for the
transfer and the amount of cumulative changes in the fair value which was previously directly recognized in owner's
equity and which should be apportioned to the portion derecognized and the above book amount apportioned will be
included in the current profits and losses.
The Company must determine whether almost all the risks and rewards of ownership of the financial assets have
been transferred before endorsing the transfer of financial assets sold by means of recourse and financial assets held.
If almost all the risks and rewards of ownership of the financial asset have been transferred to the transferee, the
financial asset will be derecognized; if the risks and rewards of the ownership of the financial asset have been
retained, the financial asset will not be derecognized; if almost all the risks and rewards of ownership of the financial
asset have not been transferred or retained, the enterprise needs to continue to determine whether it retains control
over the asset and performs accounting treatment in accordance with the principles described in the preceding
paragraphs.
(4) Derecognition of financial liabilities
If the present obligation for a financial liability has been fully or partially discharged, the financial liability or
the relevant portion thereof will be derecognized. If the Company (borrower) signs an agreement with the lender to
replace the original financial liability by assuming a new financial liability, and the contract terms of the new
financial liability and the original financial liability are substantially different, the original financial liability will be
derecognized and the new financial liability will be recognized at the same time. If a material amendment is made to
the contractual terms for the original financial liability or the relevant portion thereof, the original financial liability
will be derecognized, and the new financial liability will be recognized according to the amended terms at the same
time.
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If the financial liability or the relevant portion thereof is derecognized, the difference between the book value of
the financial liability derecognized and the consideration paid for it (including the non-cash asset transferred or the
liability assumed) will be included in the current profits or losses.
(5) Offsetting financial assets with financial liabilities
When the Company has the legal right to offset the financial asset and the financial liability with recognized
amount, and such legal rights are currently enforceable, and the Company plans to settle in net or simultaneously
realize the financial asset and liquidate the financial liability, the financial asset and the financial liability will be
presented in the balance sheet in net amounts after mutual offset. In addition, financial assets and financial liabilities
are presented separately in the balance sheet, and are not offset against each other.
(6) Method for determining the fair value of financial assets and financial liabilities
Fair value refers to the price that a market participant can receive for the sale of an asset or need to pay for the
transfer of a liability in the orderly transaction that occurs on the measurement date. For financial instruments for
which there is an active market, the fair value thereof will be determined by the Company based on the quotation in
the active market. Quotation in the active market refers to the price that is easily obtained from exchanges, brokers,
industry associations, pricing service agencies, etc. on a regular basis, and represents the price of market transactions
that actually occur in fair trading. For financial instruments for which there is no active market, the fair value thereof
will be determined by the Company using the valuation techniques. The value appraisal techniques include the prices
adopted by the parties, who are familiar with the condition, in the latest market transaction upon their own free will,
the current fair value obtained by referring to other financial instruments of the same essential nature, the cash flow
capitalization method and the option pricing model, etc. At the time of valuation, the Company adopts a valuation
technique that is applicable in the current circumstances and that there is sufficient available data and other
information to support, selects the input values consistent with the asset or liability characteristics considered by the
market participants in the transaction of the underlying asset or liability, and as far as possible uses relevant
observable input values. Unobservable input values are used where the relevant observable input values are not
available or are not practicable.
(7) Equity instruments
Equity instruments refer to contracts that can prove ownership of the residual equity in assets of the Company
after deduction of all the liabilities. The Company treats issue (including refinancing), repurchases, sale or
cancellation of equity instruments as changes in equity, and transaction expenses related to equity transactions are
deducted from equity. The Company does not recognize changes in the fair value of equity instruments.
If the Company's equity instruments distribute dividends (including "interest" generated by instruments
classified as equity instruments) during the existence period, such dividends will be treated as profit distribution.
11. Impairment of financial assets
Financial assets of which the Company needs to recognize impairment losses include financial assets measured
at amortization cost, and debt instrument investments which are measured at fair value and of which changes
included in other comprehensive income, mainly including receivables financing, accounts receivable, contract assets,
other receivables, loans and advances, debt investment, other debt investment, long-term receivables, etc.
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(1) Recognition methods of provision for impairment
Based on the expected credit loss, the Company makes impairment provision and recognizes credit impairment
loss according to the applicable expected credit loss measurement method (general method or simplified method) for
the above items.
Credit loss refers to the difference between all contractual cash flows that are due to the Company in accordance
with the contract and all the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the
original effective interest rate. Among them, for purchased or originated credit-impaired financial assets, the
Company discounts the difference at the credit-adjusted effective interest rate of the financial assets.
The general method for measuring expected credit losses is that the Company assesses on each balance sheet
date whether the credit risk of financial assets has increased significantly since initial recognition. If the credit risk
has increased significantly since initial recognition, the Company measures the loss provisions according to the
amount equal to lifetime expected credit losses. If the credit risk has not increased significantly since initial
recognition, the Company measures the loss provisions according to the amount equal to 12-month expected credit
losses. The Company considers all reasonable and valid information, including forward-looking information, when
assessing expected credit losses.
For financial instruments with lower credit risk on the balance sheet date, the Company assumes that their credit
risk has not increased significantly since initial recognition.
(2) Judgment standards for whether the credit risks have increased significantly since the initial recognition
If the probability of default of a financial asset in the expected lifetime determined on the balance sheet date is
significantly higher than the probability of default in the expected lifetime determined at the time of initial
recognition, it indicates that the credit risk of the financial asset has increased significantly. Except for special
circumstances, the Company uses the change in default risk that occurs within the next 12 months as a reasonable
estimate of the change in default risk that occurs throughout the lifetime to determine whether the credit risk has
increased significantly since initial recognition.
(3) Assessment methods of the expected credit risks based on combinations
The Company assesses the credit risks of the financial assets with significantly different credit risks respectively,
such as accounts receivable from disputes with the other party or litigation and arbitration, and receivables with
obvious signs indicating that the debtor is likely to be unable to fulfill the repayment obligation, etc.
In addition to the financial assets whose credit risks are assessed respectively, the Company divides the financial
assets into different groups based on their common risk characteristics, and assesses the credit risks on the basis of
combinations.
(4) Accounting treatment methods of financial assets impairment
At the end of the period, the Company calculates the estimated credit losses of various financial assets. If the
estimated credit losses are greater than the book value of the current impairment provisions, the difference is
recognized as an impairment loss; If the estimated credit losses are smaller than the book value of the current
impairment provisions, the difference is recognized as an impairment gain.
(5) Recognition methods of the credit losses of all kinds of financial assets
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1) Notes receivable and receivables financing
For notes receivable and receivables financing, the company measures the loss reserves according to the amount
of the expected credit losses during the whole duration. Based on the credit risk characteristics of notes receivable
and receivables financing, financial assets are divided into different combinations:
Item Basis for recognition of combinations
Banker's acceptance bill The acceptor is a bank institution or a financial company
Trade acceptance draft The acceptor is a company other than a bank institution or financial company
2) Accounts receivable and contract assets
For accounts receivable and contract assets that do not contain significant financing components and contain
significant financing components, the Company measures the loss provision based on the lifetime expected credit loss
amount. Expected credit losses related to contract assets are included in asset impairment losses.
In addition to accounts receivable of which credit risk is individually assessed, the Company divides accounts
receivable into different combinations based on their credit risk characteristics:
Item Basis for recognition of combinations
Combination 1: Account age
The combination takes the account age of accounts receivable as the basis for the combination
combination
Combination 2: Low risk The combination takes the dismantling subsidy of waste electrical and electronic products receivable
combination from government departments and new energy vehicle subsidies as the basis for the combination
Combination 3: None risk The combination takes the receivables from related units within the scope of consolidation as the basis
combination for the combination
3) Disbursement of loans statements and advances
Based on the internal assessment results of the credit risk management system of the relevant financial
instruments, the Company defines whether credit impairment has occurred: the Company calculates the expected
credit loss of the financial assets at the expected credit loss rate of different categories, according to the five-level
classification of the financial industry (normal, concerned, secondary, suspicious and loss) based on the borrower's
actual repayment ability.
4) Other receivables
The Company measures impairment losses using an amount equivalent to 12-month or lifetime expected credit
losses, based on whether the credit risk of other receivables has increased significantly since initial recognition. In
addition to other receivables of which credit risk is individually assessed, the Company divides other receivables into
different combinations based on their credit risk characteristics:
Item Basis for recognition of combinations
Combination 1: Account age
The combination takes the account age of other receivables as the basis for the combination
combination
Combination 2: Low risk
The combination takes the receivable government grain deposits as the basis for the combination
combination
Combination 3: None risk The combination takes the receivables from related units within the scope of consolidation as the
combination basis for the combination
5) Debt investment
Debt investment mainly accounts for bond investment measured at amortization cost. The Company measures
impairment losses using an amount equivalent to 12-month or lifetime expected credit losses, based on whether the
credit risk of other debt investments has increased significantly since initial recognition.
6) Other debt investments
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Other debt investments mainly accounts for the debt instrument investments which are measured at their fair
values and of which the changes are included into other comprehensive income. The Company measures impairment
losses using an amount equivalent to 12-month or lifetime expected credit losses, based on whether the credit risk of
other debt investments has increased significantly since initial recognition.
7) Long-term receivables
The Company's long-term receivables are incomes from the sales of goods collected in installments. The
company measures the loss reserves according to the amount of the expected credit losses during the whole duration.
12. Receivable financing
For notes receivable and accounts receivable classified as measured at fair value and of which changes are
included in other comprehensive income, the portion within one year (including one year) from the date of
acquisition is presented as receivables financing; while the portion beyond one year is presented as other debt
investment. For related accounting policies, please refer to Note III. 10 "Financial Instruments" and Note III. 11
"Impairment of Financial Assets".
13. Inventory
(1) Inventory classification
The Company's inventories mainly include raw materials, work in progress and contract performance costs,
finished products, development costs, and development products.
Development cost refers to the property that has not been completed and is for sale; the Company accounts for
the land use rights purchased and used for commercial housing development as the development cost. Development
product refers to the property that has been completed and is to be sold.
(2) Valuation for delivered inventories
Valuation for delivered inventories: When various kinds of inventories of the Company are delivered, they shall
be valuated at planned costs, and the planned costs shall be adjusted into actual costs based on the difference of costs
of the current month at the end of the month.
Development cost and product development cost include land transfer fees, infrastructure expenditures,
construction and installation engineering expenditures, borrowing costs incurred before the development project is
completed, and other related costs incurred in the development process. When developing product is carried forward
the cost, the total cost is allocated between the sold and unsold properties in proportion to the construction area.
(3) Recognition of the net realizable value and measurement of provision for decline in value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the cost of
inventories is higher than the net realizable value, a provision for decline in value of inventories shall be made and
shall be recorded into the profits and losses of the current period, where a provision for decline in value of inventories
has been made, if the value of the said inventories is resumed later, the said value shall be reversed from the provision
for decline in value of the inventories. Net realizable value is the estimated selling price in the ordinary course of
business less the estimated costs of completion and the estimated costs necessary to make the sale and relevant taxes.
(4) Stock count system for inventories
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The Company's inventory adopts the perpetual inventory system.
(5) Amortization methods of low-value consumables and packaging materials
Low-value consumables and packaging materials are written off in full when issued for use.
14. Contract assets
The Company presented the right to collect payments from customers which the customers have not yet paid the
contract consideration, but the Company has fulfilled its performance obligations in accordance with the contract, and
which is not unconditional (that is, only depending on the passage of time) as contract assets in the balance sheet.
Contract assets and contract liabilities under the same contract are presented in net amount, and contract assets and
contract liabilities under different contracts are not offset.
For the determination and accounting treatment of expected credit losses of contract assets, please refer to Note
III. 11 "Impairment of Financial Assets".
15. Contract costs
(1) Determination of asset amount related to contract costs
The Company's asset related to contract costs includes contract acquisition cost and contract obtain cost.
If the incremental cost incurred by the Company to obtain the contract is expected to be recovered, it will be
recognized as an asset as contract acquisition cost. However, if the amortization period of the asset does not exceed
one year, it will be included in current profits or losses when it occurs.
If the cost incurred by the Company for the performance of the contract does not fall within the scope specified
in the accounting standards for business enterprises other than the Accounting Standards for Business Enterprises No.
14 - Revenues (Revised in 2017), it shall be recognized as an asset as the contract performance cost when the
following conditions are met simultaneously: ① the cost is directly related to a current or expected contract,
including direct labor cost, direct material cost, manufacturing expense (or similar expense), cost clearly borne by the
customer, and other costs incurred only due to the contract; ② the cost increases the Company's future resources for
fulfilling its performance obligations; and ③ the cost is expected to be recovered.
(2) Amortization of assets related to contract costs
The Company’s assets related to contract costs are amortized on the same basis as the recognition of goods
income related to the asset and included in the current profit and loss.
(3) Impairment of assets related to contract costs
When recognizing the impairment loss of assets related to the contract cost, the Company shall first recognize
the impairment loss of other assets related to the contract and recognized in accordance with other relevant corporate
accounting standards; then, based on the fact that the book value is higher than the difference between the residual
consideration expected to be obtained by the Company due to the transfer of the goods related to the asset and the
estimated cost to be incurred for the transfer of the relevant goods, the excess part shall be withdrawn for impairment
provision and recognized as asset impairment loss.
If the depreciation factors in the previous period change later, causing the aforementioned difference is higher
than the book value of the asset, the Company will reverse the previously-made provision for impairment and include
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it in the current profits or losses, but the book value of the asset after the reversal can not exceed the book value of the
asset at the date of reversal under the assumption that no provision is made for the impairment.
16. Assets held for sale
(1) Recognition standard
Where the Company recovers its book value by selling (including the non-monetary asset exchange with
commercial substance; it is the same below), not continuously using a non-current asset or disposal group, it shall be
classified into the category of assets held for sale. The non-current asset or disposal group to be classified into the
category of assets held for sale shall meet the following conditions at the same time:
According to the practice of selling such assets or disposal groups in similar transactions, they can be sold
immediately under the current circumstances;
Selling is extremely likely to happen, that is to say that GDG has make decision for a selling plan and has
obtained recognized purchase commitment and selling is expected to be completed within one year. If it can be sold
only after being approved by relevant authority organization or supervision department of GDG according to relevant
requirements, it should have been approved. Recognized purchase commitment refers to purchase agreement with
legal binding force that the Company concludes with other parties, which includes important clauses of transaction
price, time and enough strict default punishment, etc., with which, possibility to lead to major adjustment or
cancellation of agreement is tiny.
The non-current asset or disposal group acquired by the Company for resale shall be classified as the held for
sale on the acquisition date if it meets the requirements of “expected to be sold within one year” on the acquisition
date, and it is likely to meet the other classification conditions for holding for sale in the short term (usually three
months).
The disposal group refers to a group of assets that are disposed of as a whole in a transaction through sale or
other means, and the liabilities that are directly related to these assets and transferred in the transaction. Where the
goodwill obtained in the merger of enterprises is apportioned for the asset group or asset group combination to which
the disposal group belongs according to Accounting Standards for Enterprises No.8 - Impairment of Assets, this
disposal group should contain the goodwill apportioned to the disposal group.
(2) Accounting treatment
For the non-current asset and disposal group that is classified as the category held for sale, the Company carries
out initial measurement or re-measurement according to the smaller result of the net value of the book value and the
fair value minus the net amount of the disposal expense. Where the net value of the fair value minus the disposal cost
is lower than the original book value, the difference is confirmed as assets impairment loss and include in the current
profits and losses, and the provision for impairment of the assets held for sale is made at the same time; for the
amount of assets impairment loss confirmed by the disposal group held for sale, the book value of the goodwill in the
disposal group is deducted first, and then its book value is deducted in proportion according to the ratios of the book
values of various non-current assets applicable to measurement of the category held for sales in the disposal group.
Where the net value of the fair value of non-current assets held for sale on the balance sheet date minus the
selling expense increases subsequently, the previous write-down amount is restored and will be reversed in the
amount of assets impairment loss after classification as the category held for sales is confirmed, and the reversed
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amount shall be included in the current profits and losses. Asset impairment losses recognized before the
classification are not reversed.
Where the net value of the fair value of disposal group held for sale on the balance sheet date minus the selling
expense increases subsequently, the previous write-down amount is restored and will be reversed in the amount of
assets impairment loss confirmed for non-current assets applicable to the measurement provisions of the category
held for sale after classification as the category held for sales, and the reversed amount shall be included in the
current profits and losses.
For the deducted book value of goodwill and the non-current assets applicable to the measurement provisions of
the category held for sale, the asset impairment loss confirmed before classification as the category held for sales
shall not be reversed. For the subsequently reversed amount of assets impairment loss confirmed for the disposal
group held for sale, its book value is increased in proportion according to the ratios of the book values of various
non-current assets applicable to measurement provisions of the category held for sales in the disposal group
excluding the goodwill. The non-current assets held for sale or non-current assets in the disposal group are not made
for provision for impairment or amortized, and the interests on debts and other expenses in the disposal group held
for sale will be confirmed continuously.
The measurement methods of the category held for sale do not apply to the deferred income tax assets, financial
assets complying with the specifications of Accounting Standards for Business Enterprises No. 22 - Recognition and
Measurement of Financial Instruments, investment real estate and biological assets measured at fair value, contract
rights produced in the insurance contract, and the assets produced in the welfare of the workers, and they are
measured according to the relevant criteria or corresponding accounting policies formulated by the Company. Where
the disposal group contains the non-current assets applicable to the measurement method of the category held for sale,
the measurement method of the category held for sale is applicable to the whole disposal group. The related
accounting standards apply to measurement of liabilities in the disposal group.
When the non-current assets or disposal group is removed from the disposal group held for sale because it does
not meet the classification condition of the category held for sale anymore and will not be classified as the category
held for sale or non-current assets, it shall be measured according to the smaller one of the following two:
1) In case of the book value before being classified into the held for sale category, the amount adjusted
according to the depreciation, amortization or impairment that should have been recognized under the assumption
that it is not classified as held for sale category;
2) Recoverable amount.
17. Long-term equity investments
The long-term equity investments mainly include the equity investment held by the Company that can take
control over the invested entity and have a significant impact, as well as the equity investment in its joint venture.
(1) Judgment standards of control and significant influence
Judgment standards of control:
1) The Company owns the power to the invested entity;
2) The Company enjoys variable return by participating relevant activities of the invested entity;
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3) The Company has the ability to use the power over the invested entity to influence the Company's return
amount;
4) The Company acknowledges the control force for the invested entity that meets the above three
conditions.
Judgment standards of significant influence:
1) The Company has the power to participate in the decision-making of the investee's financial and operating
policies, but does not control, or jointly control the formulation of these policies with other parties;
2) Where GDG is able to exert significant impact on the investee, it is the associated enterprise of GDG;
3) The invested entity under common control by the Company and other participants is a joint venture of the
Company. Common control means that any participant cannot independently control this arrangement, and any
participant with the right to common control on this arrangement can prevent other participants or the
combination of participants from independently controlling this arrangement.
(2) Determination of the investment cost of the long-term equity investment
The long-term equity investment of the Company is measured at the investment cost at the time of acquisition.
Normally the investment cost refers to the assets paid, liabilities incurred or undertaken, and the fair value of equity
securities issued for the acquisition of this investment, including the costs directly attributable to the acquisition.
However, for the long-term equity investment formed by business combination involving enterprises under common
control, the investment cost is the share of carrying amount of the combined party's net assets acquired on the
combination date in the ultimate controlling party's consolidated financial statements.
(3) Subsequent measurement of long-term equity investments and methods of profit or loss recognition
The company adopts the cost method to calculate the long-term equity investment that can control the investee,
and the equity method to calculate the investment of associated enterprise and joint venture.
The price of a long-term equity investment accounted by employing the cost method shall be included at its
initial investment cost. If there are additional investments or disinvestments, the cost of the long-term equity
investment shall be adjusted. The cash dividends or profits declared to distribute by the invested entity shall be
recognized as investment income and charged to profits or losses of the current period.
When the Company employs the equity method for accounting of the long-term equity investment, if the
investment cost of a long-term equity investment is more than the investing enterprise' attributable share of the fair
value of the invested entity's identifiable net assets for the investment, the investment cost of the long-term equity
investment may not be adjusted; if the investment cost of a long-term equity investment is less than the investing
enterprise' attributable share of the fair value of the invested entity's identifiable net assets for the investment, the
carrying amount of the long-term equity investment shall be adjusted, and the difference shall be recorded into the
profits or losses of the current period.
When the Company employs the equity method for accounting of the long-term equity investment, the Company
first adjusts the invested entity's net profits or losses and other comprehensive income in the aspects such as the fair
value of the invested entity's identifiable net assets at the time of investment acquisition, accounting policy and
accounting period, and then recognizes the current-period investment profits or losses and other comprehensive
income according to the investing enterprise' attributable or shareable share of the invested entity's net profits or
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losses and other comprehensive income. For other changes in owners' equities other than the net profits or losses,
other comprehensive income and profit distribution, the carrying amount of the long-term equity investment shall be
adjusted and recorded into the owners' equities.
For the unrealized internal transaction profits/losses that arise between the Company and the associates and joint
ventures, the part attributable to the Company shall be calculated according to the shareholding proportion, and the
investment profits/losses shall be recognized on the basis of offsetting.
For the long-term equity investments held already prior to January 1, 2007 for the associates and joint ventures,
if there is any equity investment difference on the debit side, the investment profits/losses shall be recognized after
deduction of the equity investment difference on the debit side amortized by the straight-line method according to the
original residual maturity.
(4) Recognition of common control and significant influences on the invested entity
Common control is recognized as the control which does not exist unless the investing parties unanimously
agree on sharing the control power over the relevant important financial and operating decisions of the invested entity
according to the provisions of the contract.
Significant influences will be recognized where there is power to participate in making decisions on the financial
and operating policies of the invested entity, but not to control or do joint control together with other parties over the
formulation of these policies. When the Company holds more than 20.00% (included) but less than 50.00% of voting
shares of the invested entity directly or indirectly through a subsidiary, significant influences on the invested entity
shall be recognized, unless there is clear evidence indicating that the Company cannot participate in production and
management decision-making of the invested entity in this situation and therefore cannot generate significant
influences; if the Company holds less than 20.00% (excluded) of voting shares of the invested entity, usually the
Company is not deemed to have a significant influence on the invested entity, unless there is clear evidence indicating
that the Company can participate in production and management decision-making of the invested entity in this
situation and therefore can generate significant influences.
(5) Conversion of accounting method of long-term equity investment
Where the equity investment originally held by the Company, which is unable to control, is not under common
control with or has no significant influences on the invested entity, is converted into an investment for an associate or
joint venture due to additional investment, the investment shall be accounted by the equity method instead, and the
Company shall use the fair value of the original equity investment plus the fair value of the consideration paid to
acquire the newly added investment as the initial investment cost accounted by the equity method instead. The
difference between the fair value and carrying amount of the originally held equity investment prior to the additional
investment, and the cumulative fair value changes originally recorded into other comprehensive income shall be
transferred to the current-period profits or losses accounted by the equity method instead.
For the originally held investments for associates and joint ventures, if they are not able to be under common
control with or have significant influences on the invested entity, if they are not able to be under common control
with or have significant influences on the invested entity due to reason such as partial disposal, accounting treatment
must be performed for remaining equity investments according to the recognition and measurement standards for
financial instruments, and the difference between the fair value and carrying amount on the date on which the
common control or significant influence is lost shall be charged to profits or losses of the current period. When
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accounting based on the equity method is terminated for other related comprehensive income originally subject to
accounting of equity method, accounting treatment is performed using the basis the same as that used by the invested
entity to directly dispose of relevant assets or liabilities; all the owners' equities that are recognized due to other
changes in owners' equities other than the net profits/losses, other comprehensive income and profit distribution of
the invested entity shall be transferred to the profits or losses of the current period when accounting based on the
equity method is terminated.
Where the originally held investments for associates or joint ventures are converted to investments for
subsidiaries due to additional investment, in the individual financial statements, the sum of the carrying value of the
acquired party's equity investment held prior to the acquisition date and the investment cost newly added on the
acquisition date shall be used as the initial investment cost of such an investment; for the equity investment held prior
to the acquisition date, other comprehensive income recognized due to accounting of the equity method shall undergo
accounting treatment using the basis the same as that used by the invested entity to directly dispose of relevant assets
or liabilities when such an investment is disposed of.
When the influencing capability on the invested entity is converted from control to a significant influence or
common control together with other investors due to investment disposal, the long-term equity investment cost, for
which recognition shall be terminated, is first carried over according to the proportion of investment disposal. On
such a basis, the remaining long-term equity investment cost is compared with the share attributable to the Company
in the fair value of the invested entity's identifiable net assets at the time of original investment, which is calculated
according to the remaining shareholding proportion. For the goodwill part to be embodied in the investment
evaluation, the carrying amount of long-term equity investment shall not be adjusted; where the investment cost is
less than the share attributable to the Company in the fair value of the invested entity's identifiable net assets at the
time of original investment, any excess shall be adjusted against retained earnings when the long-term equity
investment cost is adjusted. For the share attributable to the Company in the invested entity's realized net
profits/losses between acquisition of the original investment and conversion to accounting of the equity method due
to investment disposal, the carrying amount of the long-term equity investment shall be adjusted, meanwhile, any
excess shall be adjusted against retained earnings for the share attributable to the Company in the invested entity's
realized net profits/losses (excluding the cash dividends or profits distributed or declared to distribute) from
acquisition of the original investment to the beginning of the period in which the investment is disposed of, and the
current-period profits or losses shall be adjusted for the share attributable to the Company in the invested entity's
realized net profits/losses from the beginning of the period in which the investment is disposed of to the investment
disposal date; the share attributable to the Company in the invested entity's changes in other comprehensive income
shall be recorded into other comprehensive income when the carrying amount of the long-term equity investment is
adjusted; the share attributable to the Company in the invested entity's other changes in owners' equities arising from
reasons other than the net profits or losses, other comprehensive income and profit distribution shall be recorded into
"Capital reserves -- Other capital reserves" when the carrying amount of the long-term equity investment is adjusted.
After the cost method is converted to the equity method for the long-term equity investment, the share attributable to
the Company in the invested entity's realized net profits/losses, other comprehensive income and other changes in
owners' equities shall be calculated and recognized according to provisions of the standard in the future period.
For the originally held long-term equity investment that is able to control the invested entity, if the shareholding
proportion declines due to reasons such as partial disposal and the investment cannot be able to control, be under
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common control with or have significant influences on the invested entity, accounting treatment must be performed
for remaining equity investments according to the recognition and measurement standards for financial instruments.
The difference between the fair value and carrying amount on the date of control loss shall be recorded into the
investment income of the current period.
In the process of holding the long-term equity investment, if the Company decides to sell all or part of held
stocks of the invested entity in consideration of all aspects, the carrying amount of the long-term equity investment
corresponding to the sold stocks shall be carried over accordingly, and the difference between the selling price and
the carrying amount of long-term equity investment for disposal shall be recognized as disposal profit or loss.
If the Company disposes of all the long-term equity investments accounted by the equity method, when
accounting based on the equity method is terminated for other related comprehensive income originally subject to
accounting of equity method, accounting treatment is performed using the basis the same as that used by the invested
entity to directly dispose of relevant assets or liabilities; all the owners' equities that are recognized due to changes in
other owners' equities other than the net profits/losses, other comprehensive income and profit distribution of the
invested entity shall be transferred to the investment income of the current period when accounting based on the
equity method is terminated; if a part of the long-term equity investment accounted by the equity method is disposed
of and the remaining stocks are still accounted using the equity method, other related comprehensive income
originally subject to accounting of equity method shall be handled using the basis the same as that used by the
invested entity to directly dispose of relevant assets or liabilities and be carried over by proportion, and the owners'
equities that are recognized due to other changes in owners' equities other than the net profits/losses, other
comprehensive income and profit distribution of the invested entity shall be carried over to the investment income of
the current period according to the proportion.
18. Investment real estate
The Company's investment real estate includes a land use right that is leased out, a land use right held for
transfer upon capital appreciation and a building that is leased out.
The Company's investment real estate is measured at its cost, and the Company uses the cost model for a
subsequent measurement of its investment real estate. The depreciation and amortization of the investment real estate
shall be made in accordance with the accounting policies of fixed assets or intangible assets of the Company.
When the Company changes the purpose of the investment real estate, such as for self-use, it shall transfer the
relevant investment real estate to other assets.
See 24 “Long-term asset impairment” of the Note III for the impairment test method and impairment reserve
accrual method of investment real estate.
19. Fixed assets
(1) Recognition standard of fixed assets
The Company's fixed assets refer to tangible assets held for the production of commodities, provision of labor
services, lease or operation and management, with a service life exceeding one accounting year. Fixed assets can not
be recognized unless they simultaneously meet the conditions as follows:
1) The economic interests related to the fixed assets are likely to flow into the enterprise;
2) The cost of this fixed asset can be measured reliably.
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(2) Measurement of fixed assets
The fixed assets are measured at cost.
1) The cost of a purchased fixed asset consists of the purchase price, the relevant taxes, freight, loading and
unloading fees, professional service fees and other expenses that bring the fixed asset to the expected conditions for
use and that may be relegated to the fixed asset.
2) If the payment for a fixed asset is delayed beyond the normal credit conditions and it is of financing
nature in effect, the cost of the fixed asset shall be recognized based on the present value of the purchase price.
The difference between the actual payment and the present value of the purchase price shall be included in the
current profits and losses within the credit period, unless it shall be capitalized in accordance with the Accounting
Standards No. 17 - Borrowing Costs.
3) The cost of self-constructed fixed assets consists of the necessary expenditures incurred before the assets
reaching the predetermined usable state.
4) The cost invested to a fixed asset by the investor shall be recognized in accordance with the value as
stipulated in the investment contract or agreement, other than those of unfair value as stipulated in the contract or
agreement.
5) The costs of fixed assets acquired through the exchange of non-monetary assets, recombination of
liabilities, merger of enterprises shall be respectively recognized in accordance with the Accounting Standards No.
7 - Exchange of Non-monetary Assets, Accounting Standards for Enterprises No. 12 - Debt Restructuring,
Accounting Standards for Enterprises No. 20 - Merger of Enterprises and Accounting Standards for Enterprises
No. 21 - Leases.
(3) Classification of fixed assets
The Company's fixed assets are classified into houses and buildings, machinery equipment, electronic equipment
and transportation equipment and otherwise.
(4) Depreciation of fixed assets
1) Recognition of depreciation method and service life, expected net salvage value rate and annual depreciation
rate:
The depreciation of fixed assets shall be made by the straight-line method. The annual depreciation rate
recognized according to the category, service life and expected net salvage value rate of fixed assets is as follows:
Expected net salvage value Annual depreciation
Category of fixed asset Expected service Life (year)
rate (%) rate (%)
Houses and buildings 5.00 20.00 4.75
Machinery equipment 5.00 6.00-10.00 9.50-15.83
Electronic equipment 5.00 2.00-3.00 31.67-47.50
Transportation equipment 5.00 3.00-4.00 23.75-31.67
Others 5.00 3.00-5.00 19.00-31.67
Depreciation of fixed assets of which a provision for impairment has been made: For a fixed asset of which a
provision for impairment has been made, the depreciation of the fixed asset shall be made based on the amount of
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deducting its expected net salvage value, depreciation amount and provision for impairment from the original price of
the fixed asset and remaining service life of the fixed asset.
For the fixed assets that have reached intended usable condition but not prepared the final account for
completion, their costs shall be recognized at their estimated value, and their depreciation shall be made accordingly;
After completion of the final account for completion, the original estimated value of the fixed assets shall be adjusted
by their actual costs, but the original depreciation amount does not require adjusting.
2) Check of service life, expected net salvage value and depreciation method of fixed assets:
The Company shall, at least at the end of each year, have a check on the service life, expected net salvage value,
and the depreciation method of the fixed assets. If the Company finds that there is any difference between the
expected service life and the previously estimated service life of a fixed asset, the expected service life of the fixed
asset shall be adjusted; If there is any difference between the amount of expected net salvage value and the previously
estimated amount of the net salvage value, the expected net salvage value shall be adjusted; If any significant change
is made on the form of the realization of the expected economic benefits concerning a fixed asset, the method for the
depreciation of the fixed asset shall be changed. If any change is made to the service life, expected net salvage value
or the depreciation method of a fixed asset, it shall be regarded as a change of the accounting estimates.
(5) Treatment of subsequent expenditures for fixed assets
Subsequent expenditures incurred on a fixed asset refer to repair expenses, renovation expenses, repair costs and
decoration expenses and otherwise incurred in the course of use of the fixed asset. Their accounting treatment is as
follows: Where subsequent expenditures of a fixed asset such as renovation expenses meet the conditions of
recognizing the fixed asset, they shall be recorded into the cost of the fixed asset, and the carrying amount of the
replaced part of the subsequent expenditures shall be deducted; Where subsequent expenditures of a fixed asset such
as repair costs do not meet the conditions of recognizing the fixed asset, they shall be recorded into the profits and
losses of the current period in which they are incurred; Where the decoration expenses of a fixed asset meet the
conditions of recognizing the fixed asset, they shall be measured in a single detail account of "Fixed Assets", and the
depreciation of the fixed asset shall be made separately by the straight-line method in a shorter time of the period of
two decorations and remaining usable life of the fixed asset.
The improvement expenditures incurred on a fixed asset leased by operating lease shall be capitalized and
reasonably amortized as long-term prepaid expenses.
(6) Impairment test method and accounting and drawing method for impairment provision of fixed assets
See 24 “Long-term Assets Impairment” of the Note III for the impairment test method and impairment provision
method of fixed assets.
20. Construction in progress
The term "construction in progress" refers to all necessary expenditures incurred before the acquired fixed assets
enable the project to reach expected usable condition, including project direct materials, direct employee
remunerations, installation costs for equipment to be installed and project construction, project management fees, net
profits and losses of project commissioning and approved capitalized borrowing costs.
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(1) Valuation of construction in progress
The Company's construction in progress shall be measured individually by construction project and shall be
valuated at actual cost.
(2) Time when construction in process is carried forward to fixed assets
When the construction in progress reaches the expected usable condition, they shall be transferred to fixed asset
at their actual cost. For the fixed assets that have reached expected usable condition but not prepared the final account
for completion, they shall be charged to the account at their estimated value and shall be adjusted after their actual
value is recognized.
See 24 “Long-term Asset Impairment” in the Note III for the impairment test method and impairment provision
method of construction in process.
21. Borrowing costs
Borrowing costs are interests and other costs incurred by the Company in connection with the borrowing of the
funds, including interests, 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.
(1) Recognition of capitalization of borrowing costs
The borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying
asset shall be capitalized, and the amounts of other borrowing costs incurred shall be recorded into the profits and
losses of the period in which they are incurred. Qualifying assets are fixed assets, investment real estate and
inventories and otherwise that necessarily take a substantial period of time for acquisition, construction or production
to get ready for their intended use or sale.
(2) Period of capitalization of borrowing costs
1) Time point of capitalization of borrowing costs.
The capitalization of borrowing costs commences only when all the following conditions are satisfied:
a. Expenditures for the asset have been incurred;
b. Borrowing costs have been incurred; and
c. Activities relating to the acquisition, construction or production of the asset that are necessary to prepare the
asset for its intended use or sale have commenced.
2) Time point of ceasing capitalization of borrowing costs:
Capitalization of borrowing costs ceases when the qualifying asset acquired, constructed or produced becomes
ready for its intended use or sale. The subsequent borrowing costs shall be recorded into the profits and losses of the
current period.
3) Recognition of suspending capitalization of borrowing costs:
When an abnormal interruption occurs during the construction or production of an asset which satisfies the
conditions for capitalization and the interruption continues for more than three months consecutively, the
capitalization of borrowing expense will be paused, the borrowing expense incurred during the suspension will be
included in the current profits and losses.
(3) Computing method of capitalizing amount of borrowing costs
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During the capitalization period, the amount of interest (including amortization of discounts or premiums) to be
capitalized for each accounting period shall be recognized as follows:
1) Where special funds are borrowed for the acquisition, construction or production of a qualifying asset, the
amount of interest to be capitalized shall be 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.
2) Where general funds are borrowed for the acquisition, construction or production of a qualifying asset,
the amount of interest to be capitalized on such general borrowings shall be calculated and recognized by
applying a capitalization rate of such general borrowings to the weighted average of the excess amounts of
accumulated expenditures on the asset over and above the amounts of special borrowings. The capitalization rate
shall be calculated and recognized by the weighted average interest rate of general borrowings.
Where there is any discount or premium, the amount of discounts or premiums that shall be amortized during
each accounting period shall be recognized by the real interest rate method, and an adjustment shall be made to the
amount of interests in each period. During the period of capitalization, the amount of interest capitalized during each
accounting period shall not exceed the amount of interest actually incurred to the relevant borrowings in the current
period.
Ancillary costs in connection with special borrowings that are incurred before the qualifying asset acquired,
constructed or produced becomes ready for its intended use or sale shall be capitalized on the basis of the incurred
amount when they are incurred, and they shall be recorded into the cost of qualifying asset; those incurred after the
qualifying asset acquired, constructed or produced becomes ready for its intended use or sale shall be recognized as
expenses on the basis of the incurred amount when they are incurred, and shall be recorded into the profits and losses
of the current period. The ancillary costs arising from a general borrowing shall be recognized as expenses at their
incurred amount when they are incurred, and shall be recorded into the profits and losses of the current period.
22. Usufruct assets
For the determination method of right-of-use asset and accounting treatment method, please see Note III. 34
"Lease".
23. Intangible assets
An intangible asset is an identifiable non-monetary asset without physical substance owned or controlled by the
Company. Intangible assets can be recognized only when they meet the conditions simultaneously as follows:
a. They are consistent with the definition of intangible assets;
b. The economic benefits related to intangible assets are likely to flow into the Company; and
c. The cost of intangible assets can be measured reliably.
(1) Measurement of intangible assets
The intangible assets shall be measured according to their cost or fair value (if increased through business
combination not involving enterprises under common control).
(2) Subsequent measurement
The Company shall analyze and judge the service life of intangible assets when it obtains intangible assets. If the
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Company is unable to forecast the period when the intangible asset can bring economic benefits to it, it shall be
regarded as an intangible asset with uncertain service life.
With regard to an intangible asset with limited service life, its amortization amount shall be amortized by
expected realization pattern of its economic benefits, if the Company is unable to recognize the expected realization
pattern reliably, intangible assets shall be amortized by the straight-line method.
The Company shall, at least at the end of each year, check the service life and the amortization method of
intangible assets with limited service life. If necessary, it shall adjust the said service life and amortization method.
With regard to an intangible asset with uncertain service life, its amortization amount shall not be amortized, but
the Company shall check the service life of the said intangible asset every year and shall carry out an impairment test
for it.
(3) Estimation of service life
As for intangible assets with limited service life, the estimation of their service life generally considers the
following factors:
1) General life cycle of products manufactured by using the assets and information about service life of similar
assets available;
2) Present situation of technologies and process and estimation for future development trends;
3) Market demand of products manufactured or services rendered by using the assets;
4) Expected actions of present or potential competitors;
5) Expected maintenance expenses for economic capacity from the assets and the Company's expected
capability to pay relevant expenses;
6) Laws and regulations or similar restrictions relating to the control period of the assets, such as concession
period and lease period;
7) Relevance with service life of other assets held by the Company, etc.
(4) Division of research expenditures and development expenditures included in expenditures for internal
research and development projects
1) Research expenditures in internal research and development projects shall be recorded into the profits and
losses of the current period when they are incurred.
2) The expenditures for the development stage of internal R&D projects shall be recognized as intangible
assets when the following conditions are met at the same time:
a. The development of the intangible asset is completed to make the use or sale of the intangible assets feasible
technically;
b. Have the intent to complete the intangible assets and use or sell them;
c. How the intangible asset will generate economic benefits, including the ability to demonstrate the existence of
a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the
usefulness of the intangible asset;
d. Availability of adequate technical, financial and other resources to complete the development and to use or
sell the intangible asset;
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e. Ability to measure reliably the expenditure that is attributable to the intangible asset during its development.
Where the expenditures at research stage or at development stage cannot be distinguished, all expenditures to
research and development shall be included in the current profits and losses.
(5) Impairment test method and accounting and drawing method of impairment provision for intangible assets
See 24 “Long-term Assets Impairment” of the Note III for the impairment test method and impairment provision
method of intangible assets.
24. Impairment of long-term assets
On the balance sheet date, if there is any sign showing possible impairment of assets (referring to the assets
other than inventories, equity instruments that have no quoted price and reliable fair value measurement in active
market, investment real estate measured by fair value model, consumable biological assets, assets formed under
construction contract, deferred income tax assets, residual value not guaranteed by the renter in the financing lease
and financial assets), their recoverable amount shall be estimated on the basis of single item assets; Where it is
difficult to estimate the recoverable amount of the single item assets, the recoverable amount of the assets shall be
recognized on the basis of their asset group or combination of asset groups.
The recoverable amount shall be recognized in light of the higher one of the net amount of the fair value of the
single item assets, asset group or combination of asset groups less the disposal expenses and the present value of the
expected future cash flow of the single item assets, asset group or combination of asset groups.
Where the recoverable amount of the single item assets is lower than their carrying amount, a provision for the
asset impairment shall be made accordingly on the basis of the difference between the carrying amount of the single
item assets and their recoverable amount. Where the recoverable amount of an asset group or a combination of asset
groups is lower than its carrying amount, it shall be recognized as the corresponding impairment loss. The amount of
the impairment loss shall first charge against the carrying amount of goodwill which is apportioned to the asset group
or combination of asset groups, then charge it against the carrying amount of other assets in proportion to the weight
of other assets in the asset group or combination of asset groups with the goodwill excluded. The charges against the
carrying amount of the assets above shall be treated as the impairment loss of the single item assets (including the
goodwill), and a provision for impairment of the single item assets shall be made accordingly.
Once the above loss of asset impairment is recognized, it shall not be switched back in future accounting
periods.
25. Long-term unamortized expenses
Long-term deferred expenses refer to the expenses incurred by the Company but attributable to the current and
subsequent accounting periods of more than one year (excluding one year), including the expenses for improvement
of fixed assets leased by operating lease.
Long-term deferred expenses shall be recorded into the account based on their actual amount of expenditure and
shall be averagely amortized by their beneficial period, if long-term deferred expenses can not benefit subsequent
accounting periods, the unamortized value of the project shall be all transferred to the profits and losses of the current
period.
26. Contract liabilities
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Contract liability refers to the Company's obligation to transfer goods to customers for consideration received or
receivable from customers. If before the Company transfers the goods to the customer, the customer has paid the
contract consideration or the Company has obtained the unconditional right to receive payment, the Company will, at
the earlier time point between the actual payment by the customer and the payment due, present the amount received
or receivables as contract liabilities. Contract assets and contract liabilities under the same contract are presented in
net amount, and contract assets and contract liabilities under different contracts are not offset.
27. Employees' wages and salaries
(1) Accounting treatment of short-term wages and salaries
In the accounting period during which employees provide services to the Company, the Company recognizes the
short-term wages and salaries actually incurred as liabilities and charges them to the current-period profits and losses
or relevant asset costs.
(2) Accounting treatment of separation benefits
The severance benefit plans can be divided into the defined contribution plan and the defined benefit plan
1) In the accounting period during which employees provide services to the Company, the Company recognizes
the amount to be deposited (calculated according to the defined contribution plan) as liabilities and charges it to the
current-period profits and losses or relevant asset costs.
2) The accounting treatment for defined benefit plan generally includes the following steps:
a. The Company will estimate the relevant demographic statistical variables and financial variables with
unbiased and consistent actuarial assumptions by using the projected unit credit method, and then measure the
obligations arising from the defined benefit plan, and the period in which the obligations incurred is determined
accordingly;
b. The present value of obligation under the defined benefit plan minus the deficit or surplus formed by the fair
value of asset under the defined benefit plan shall be recognized as the net liabilities or net assets under a defined
benefit plan. If the defined benefit plan had surplus, the Company should measure the net asset under the defined
benefit plan with the surplus or asset caps of the defined benefit plan, whichever is lower. The upper asset limit refers
to the present value of the economic interest that can be obtained by the Company from refund of the defined benefit
plan or by reducing the fund to be deposited for the defined benefit plan in the future;
c. At the end of the period, recognize the costs of employees' wages and salaries arising from the defined benefit
plan as the service costs, net interests of net liabilities or net assets of the defined benefit plan, and changes arising
from remeasurement of net liabilities or net assets of the defined benefit plan, wherein the service costs and net
interests of net liabilities or net assets of the defined benefit plan are recorded into the current-period profits/losses or
relevant asset costs, changes arising from remeasurement of net liabilities or net assets of the defined benefit plan are
recorded into other comprehensive income and cannot be reversed to profits/losses in the subsequent accounting
period, but such amount recognized in other comprehensive income can be transferred within the equity scope;
d. Recognize a settlement gain or loss during settlement of the defined benefit plan.
(3) Accounting treatment of dismiss welfare
The liability of employees' wages and salaries that arises from the dismiss welfare shall be recognized on the
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earlier one of the following two dates and charged to the current-period profits/losses:
1) When the Company cannot unilaterally cancel the dismissal welfare provided for the labor relationship
cancellation plan or staff reduction suggestion;
2) When the Company recognizes the cost or expense related to reconstruction involving dismiss welfare
payment.
(4) Accounting treatment of other long-term employee welfares
If other long-term employee welfares offered by the Company to employees comply with the defined
contribution plan, accounting treatment will be conducted according to the defined contribution plan; the long-term
benefits other than these will undergo accounting treatment according to the defined benefit plan. However, "changes
arising from remeasurement of net liabilities or net assets of the defined benefit plan" under relevant employees'
wages and salaries will be included into the current profits or losses or relevant asset costs.
28. Lease liabilities
For the determination method of lease liability and accounting treatment method, please see Note III. 34 "Lease".
29. Accrued liabilities
(1) Recognition criteria of estimated liabilities
When the businesses related to contingencies such as external guarantee, pending action or arbitration, product
quality assurance, plan for layoffs, loss contract, restructuring obligations and fixed asset disposal obligations meet
all following conditions, they shall be recognized as liabilities:
1) The liabilities are present liabilities assumed by the Company;
2) The fulfillment of the liabilities might cause outflow of economic benefits from the enterprise;
3) The amount of the liabilities can be reliably measured.
(2) Measurement methods of estimated liabilities
The estimated liabilities shall be measured in accordance with the best estimate of the necessary expenses for the
performance of the current obligation. If there is a sequent range for the necessary expenses and if all the outcomes
within this range are equally likely to occur, the best estimate shall be recognized in accordance with the middle
estimate within the range. In other cases, the best estimate shall be recognized in accordance with the following
methods, respectively:
1) When a contingency involves a single item, the best estimate shall be determined according to the most
probable amount;
2) If the contingencies concern two or more items, the best estimate shall be calculated and recognized in
accordance with all possible outcomes and the relevant probabilities.
When all or some of the expenses necessary for the liquidation of estimated liabilities of the company is
expected to be compensated by a third party or other parties, the compensation shall be separately recognized as an
asset only when it is virtually certain that the reimbursement will be obtained. The amount recognized for the
reimbursement shall not exceed the carrying amount of the recognized estimated liabilities.
30. Share-based payments
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(1) Accounting treatment method of share-based payment
Share-based payment refers to the transaction of granting equity instruments or bearing liabilities recognized on
the basis of equity instrument for obtaining services from employees or other parties. The share-based payment is
classified into equity-settled share-based payment and cash-settled share-based payment.
1) Equity-settled share-based payments
The equity-settled share-based payment in return for employee services is measured at the fair value of the
equity instruments on the day granted to the employees. The fair value is measured based on the best estimate of the
number of vesting equity instruments in the waiting period and included in the relevant costs or expenses by the
straight-line method when its right is exercised only after the service in the waiting period is completed or the
specified performance conditions are met. When the vesting is exercised immediately after granted, the relevant cost
or fee is included on the date of the granting date, and the capital reserve is increased accordingly.
On each balance sheet date during the vesting period, the Company makes the best estimate of subsequent
information such as the latest change in number of vesting employees to correct the estimated number of vested
equity instruments. The aforementioned estimated influences are included in current relevant costs or expenses, and
the capital reserves are adjusted correspondingly.
The equity-settled share-based payment used to exchange for the services of other parties shall be measured
according to the fair value of the services of other parties on the obtaining date if the services of other parties can be
measured reliably; the equity-settled share-based payment shall be measured according to the fair value of the equity
instruments on the obtaining date of the services of other parties if the fair value of the services of other parties
cannot be measured reliably but the fair value of the equity instruments can be measured reliably, and be included in
the relevant costs or expenses, and the stockholders' equity shall be increased correspondingly.
2) Cash-settled share-based payments
The cash-settled share payment is measured according to the fair value of liabilities determined based on shares
or other equity instruments undertaken by the Company. When it is vested immediately after grant, it is included in
relevant costs or expenses as granted, and the liabilities are increased correspondingly; if it is vested after completing
the services in the vesting period or reaching the specified performance terms, the current obtained services are
included in costs or expenses based on the best estimate of vesting and at fair value of liabilities borne by the
Company on each balance sheet date of the vesting period, and the liabilities are increased correspondingly.
In each balance sheet date and the date of settlement before the settlement of the relevant liabilities, re measure
the fair value of liabilities, the changes recorded in the current profits and losses.
(2) Relevant accounting treatment for amending and terminating share-based payment plan
When the Company amends the share-based payment plan, if the fair value of equity instruments granted is
increased due to the amendment, the increase of the services obtained will be recognized correspondingly according
to the increase of the fair value of equity instruments. The increase of the fair value of equity instruments refers to the
difference between the fair values on the amendment date of equity instruments before and after amendment. If the
amendment reduces the total fair value of the share-based payment or adopts other unfavorable methods to the
employees, the accounting treatment of the obtained services will be continued as if the modification has never
occurred, unless the Company cancels part or all of the equity instruments granted.
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During the waiting period, if the granted equity instrument is canceled, the Company will handle the
cancellation as an accelerated exercise of rights, the amount that shall be recognized during the remaining vesting
period is immediately included in current profits and losses with the capital reserves recognized at the same time. If
an employee or other party can choose to meet the non-vesting conditions but fails to meet them during the vesting
period, the Company handles the failure as the cancellation of granted equity instrument.
31. Revenue
For the contract between the Company and the customer, the Company recognizes the revenue at the point when
the customer obtains control over the relevant goods and the following conditions are met simultaneously: the parties
to the contract have approved the contract and promised to perform their respective obligations; the contract clarifies
the rights and obligations of the parties to the contract in relation to the transferred goods or the provided services; the
contract has clear payment terms related to the transferred goods; the contract has commercial substance, that is, the
performance of the contract will change the risk, time distribution or amount of the Company's future cash flow; and
the consideration that the Company is entitled to obtain due to its transfer of goods to customers is likely to be
recovered.
At the commencement date of the contract, the Company identifies each individual performance obligation in
the contract, and allocates the transaction price to each individual performance obligation in accordance with the
relative proportion of the stand-alone selling price of the goods promised by each individual performance obligation.
When determining the transaction price, the Company considers the impact of out a variable consideration, major
financing components in the contract, non-cash consideration, consideration payable to customers and other factors.
The Company recognizes the transaction price allocated to each individual performance obligation as revenue at
the point when the customer obtains control over the relevant goods. When judging whether the customer has
obtained control over the goods, the Company considers the following signs: where the Company has the current
right to receive payment for the goods, that is, the customer has the current payment obligation for the goods; where
the Company has transferred the legal ownership of the goods to the customer, that is, the customer has the legal
ownership of the goods; where the Company has transferred the goods to the customer in kind, that is, the customer
has taken possession of the goods in kind; where the Company has transferred the main risks and rewards of the
ownership of the goods to the customer, that is, the customer has obtained the main risks and rewards of the
ownership of the goods; where the customer has accepted the goods; and other signs that the customer has obtained
control over the goods.
The Company's main sales of air conditioners and related products usually only include the performance
obligations of the transferred goods.
(1) Income from selling goods
1) For the income from domestic sales of products, the Company mainly adopts the form of payment in advance.
The Company recognizes the income when the product is outbound and delivered to the purchaser, the shipping
document is issued or the customer's receipt bill is obtained, and the amount of income from product sales is
determined;
2) In terms of the export sales income, the Company completes the customs declaration and port departure
procedures for the products according to the contract and obtains the bill of lading. The income is confirmed
when the amount of the sales revenue is determined.
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(2) Income from rendering labor services
1) For the income from storage services, after the relevant labor services are provided, the Company will settle
the income on a monthly basis when the amount of income has been determined according to the working hours and
standard wages of the services provided, facilities used and related expenses;
2) For the income from material processing services, the Company will recognize the income when it
processes the materials according to the contract and delivers it to the customer to obtain the customer's receipt
document, and the amount of income is determined;
3) The Company's service charge and commission income include the service charge income of acceptance
business, service charge income of loan by mandate, etc.
For the service charge and commission income, the completion time point of the contractual performance
obligations is determined according to the business settlement sheet formulated through settlement with the customer
when the business is completed, and the specific amount of revenue is recognized according to the terms and ratios
stipulated in the business contract or agreement.
(3) Income from alienating of right to use assets
The income from abalienating the right to use assets includes the interest income, leasehold income, etc.
The Company confirms the income from abalienating the right to use assets when the income amount can be
reliably measured and the relevant economic benefits are likely to flow into the enterprise.
1) The interest income of the Company includes the income from the interest of the money deposited at a
financial enterprise and loan interest income. The income from the interest of the money deposited at a financial
enterprise is recognized by period according to the time of depositing and the actual interest rate. The loan interest
income is recognized when the Company grants self-operating loan and the interest is accrued by period. The loan
interest income is recognized according to the effective interest rate method.
The effective interest rate method means that the amortization cost of a financial asset or financial liability and
interest income or interest expenditure of each period are calculated according to its effective rate of interest. The
effective rate of interest refers to the interest rate used to discount the future cash flow of a financial asset or financial
liability within the expected period of existence or a shorter period to the current book value of the financial asset or
financial liability. When determining the effective rate of interest, the Company predicts the future cash flow on the
basis of considering all the contract terms of financial asset or financial liability, but does not consider the loss of
future credits. All the charges paid or collected by the Company and becoming a constituent part of the effective rate
of interest, transaction expense and transaction premium or discount shall be considered when the effective rate of
interest is determined.
2) The leasehold revenue recognition conditions of the Company are as follows:
a. The lease contract, agreement or other settlement notices recognized by the lessee are available;
b. The obligations stipulated in the contract are fulfilled, the lease invoice is issued, and the price has been
obtained or will be obtained for sure;
c. The rental cost can be measured reliably.
32. Government subsidies
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A government subsidy means the monetary and non-monetary assets obtained free by the Company from the
government, but excluding the capital invested by the government as the owner. Government subsidies consist of the
government subsidies pertinent to assets and government subsidies pertinent to income.
The Company defines the obtained government subsidies used for purchase or construction, or forming the
long-term assets by other ways as government subsidies pertinent to assets, and all the other government subsidies as
government subsidies pertinent to income. If the government document does not specify the subsidy object, the
following mode is adopted to classify the subsidies into government subsidies pertinent to income and government
subsidies pertinent to assets:
(1) If the government document specifies the project to which the subsidy aims, the amount is divided according
to the relative proportion of the paid amount to form assets to the paid amount to be recorded into expenses in the
budget of this specific project, and this division proportion needs to be checked on every balance sheet date and be
changed when necessary;
(2) If the government document provides only a general presentation of the purpose without specifying the
specific project, the subsidy shall be regarded as government subsidy pertinent to income.
The government subsidies pertinent to assets shall be recognized as deferred income and included in the profits
and losses by period according to the reasonable and systematic methods in the service life of the relevant asset when
this asset reaches the intended state of use. Where the relevant asset is sold, transferred, scrapped or damaged before
the service life ends, the related deferred income balance unallocated is transferred to the profits and losses of the
current period of asset disposal.
If the government subsidies pertinent to incomes are used for compensating the related expenses or losses in the
later period, they shall be recognized as deferred income when being obtained and shall be recorded into the
current-period profits and losses in the period when the relevant expenses or losses are recognized; if the government
subsidies pertinent to incomes are used for compensating the related cost expenses or losses incurred, they shall be
recorded into the current-period profits and losses directly when being obtained.
The government subsidies pertinent to daily activities shall be recorded in other incomes; the government
subsidies not pertinent to daily activities shall be recorded in the non-operating incomes and expenditures.
(3) The obtained subsidized interest of policy preference undergoes accounting treatment by differentiating the
following two obtaining ways:
a. Where the financial department disburses the discount fund to the loan bank so that the loan bank provides a
loan to the Company at the policy-based preferential interest rate, the fair value of loan is used as the entry value of
loan, the borrowing cost is calculated according to the effective interest rate method, and the difference between the
actual amount received and the fair value of borrowing is recognized as deferred income. The deferred income is
amortized using the effective interest rate method in the borrowing remaining period to offset the relevant borrowing
cost;
b. Where the financial department disburses the discount fund to the Company directly, the corresponding
discount is used to offset the relevant borrowing cost.
(4) Where the government subsidies are monetary assets, they shall be measured according to the amount
received or receivable. Where the government subsidies of non-monetary assets, they shall be measured at the fair
value; if the fair value cannot be obtained in a reliable way, the subsidies shall be measured at the nominal amount.
When a government subsidy is actually received, the Company usually recognizes and measures it according to the
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actually received amount. At the end of the period, however, if there is any exact evidence showing that the Company
complies with relevant conditions provided in the financial supporting policy, and it is expected to receive the capital
support from the government, this subsidy shall be measured according to the amount receivable. The government
subsidy measured according to the amount receivable shall comply with all the following conditions:
1) The amount of receivable subsidy has been confirmed by the authoritative government department by issuing
a document, or the subsidy can be independently and reasonably measured and calculated in accordance with relevant
provisions of the formally issued financial fund management measures, and it is predicted that its amount does not
involve significant uncertainty;
2) The subsidy is based on the financially supported project that is formally released by the local financial
department and initiatively disclosed according to provisions of the Regulation of the People's Republic of China on
the Disclosure of Government Information, as well as its financial fund management measures, and the management
measures must be generous (any enterprise meeting the defined conditions can apply for the subsidy) and are not
formulated specially for specific enterprises;
3) Other conditions that shall be matched according to specific conditions of the Company and this matter of
subsidy.
33. Deferred income tax assets/deferred income tax liabilities
The deferred income tax assets and deferred income tax liabilities are calculated and recognized based on the
difference between the tax base of assets and liabilities and their book values (temporary differences). For deductible
losses that can be deducted from taxable income in subsequent years in accordance with the provisions of the tax law,
the corresponding deferred income tax assets are recognized. For temporary differences arising from the initial
recognition of goodwill, the corresponding deferred income tax liabilities are not recognized. For temporary
differences arising from the initial recognition of assets or liabilities arising from non-business combination
transactions that neither affect accounting profits nor taxable income (or deductible losses), the corresponding
deferred income tax assets and deferred income tax liabilities are not recognized. At the balance sheet date, the
deferred income tax assets and deferred income tax liabilities are measured at the tax rate applicable to the period
during which the assets are expected to be recovered or the liabilities are expected to be settled.
The Company recognizes the deferred income tax assets to the extent of the amount of the taxable income which
it is most likely to obtain and which can be deducted from the deductible temporary differences, deductible losses and
tax deductions.
Deferred income tax liabilities are recognized for all taxable temporary differences arising from the investments
in subsidiaries, joint ventures and associates, except to the extent that both of the following conditions are satisfied:
the Company is able to control the timing of the reversal of the temporary differences; and it is likely that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets are recognized for all deductible
temporary differences associated with investments in subsidiaries, joint ventures and associates if all of the following
conditions are satisfied: it is likely that the deductible temporary difference will reverse in the foreseeable future and
it is likely that taxable profit in the future will be available against which the deductible temporary difference can be
utilized.
The deferred tax assets and the deferred tax liabilities are offset and presented on a net basis when all of
conditions are satisfied:
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a. deferred income tax assets and deferred income tax liabilities relate to income taxes levied by the same
taxation authority on the same taxable entity of the Company; and
b. the taxable entity of the Company has a legal right to settle current tax assets and liabilities on a net basis.
34. Lease
Lease refers to a contract in which the Company transfered or obtained the right to control the use of one or
more of recognized assets within a certain period of time in exchange for or pay consideration. On the contract
commencement date, the Company evaluates whether the contract is a lease or includes a lease.
(1) With the Company as the lessee
1) Initial measurement
On the beginning of the lease term, the Company will recognize the right to use the leased assets during the lease
term as the right-of-use asset and the current value of the lease payment amount that has not been paid as lease
liability, except for short-term lease and low-value asset lease. When calculating the current value of the lease
payment amount, the Company uses the implied interest rate in lease as a discount rate. If the implied interest rate in
lease cannot be determined, the lessee incremental borrowing interest rate is used as the discount rate.
The Company should initially measure right-of-use assets according to the cost. The cost includes:
a. The initially measured amount of the lease liabilities;
b. The lease payments minus the enjoyed lease incentives made by the Company on or before the start date of
the lease term;
c. The initial direct cost of the Company;
d. The estimated cost incurred by the Company to disassemble and remove the leased assets, restore the site of
the leased assets to the original condition or restore the leased assets to the condition agreed in the lease contract.
2) Subsequent measurement
The Company calculates and distills depreciation by referring to fixed asset depreciation policies (see Note III.
19 "Fixed assets"). If the Company can reasonably determine the obtaining of the ownership of the leasing assets
when the lease term expires, it will calculate and distill depreciation within the remaining service life of the leasing
asset. Where it is impossible to reasonably determine if the ownership of the leased asset can be acquired upon the
expiration of the lease term, the Company will make depreciation within a shorter period between the lease term and
the remaining service life of the leased asset.
For lease liability, the Company calculates its interests during the lease term according to a fixed periodic
interest rate and includes them in the current profit or loss or the cost of related assets. The variable lease payment
amount that is not included in the lease liability is included in the current profit or loss or cost of related assets when
it actually occurs.
After the lease term starts, in case of changes in the substantial fixed payment amount, the estimated amount
payable of the guarantee residual value, the index or ratio used for determining the lease payment amount, the call
option, renewal option or the assessment result or actual vesting of the termination option, the Company re-measures
the lease liability according to the current value of the lease payment amount after the change and adjusts the book
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value of the right-of-use asset accordingly. The book value of the right-of-use assets has been reduced to zero, but the
lease liabilities still need to be further reduced, the Company will include the remaining amount into the current
profits and losses.
3) Short-term leases and low value asset leases
For short-term lease (with a lease term of no more than 12 months from the beginning of the lease) and
low-value asset lease, the Company adopts a simplified processing method to include the lease payment amount into
the cost of relevant assets or current profit and loss during the lease term according to the straight line method or
other systematic and reasonable methods instead of recognizing the right-of-use asset and lease liability.
(2) With the Company as the Lessor
Based on the substance of transaction, the Company classifies the lease as finance lease and operating lease on
the lease commencement date. Finance lease refers to the lease that transfers substantially almost all risks and
rewards associated with the ownership of the assets. Operating lease refers to the lease other than the finance lease.
1) Operating leases
The Company adopts the straight line method to recognize the lease payment amount of the operating lease as
the rental income during the lease term. Variable lease payments in connection with the operating lease that are not
included in lease receipts are included in the current profits and losses when actually incurred.
2) Finance lease
On the beginning date of the lease term, the Company recognizes the financial lease receivables and terminates
the recognition of the financial lease assets. The financial lease receivables are initially measured by the net lease
investment (the sum of present value the discounted implied interest rate in lease for the non-guaranteed residual
value and the lease payments that have not been received on the beginning date of the lease term) and the interests
during the lease term are calculated according to a fixed periodic interest rate. The variable rental payments obtained
by the Company that are not included in the net lease investment are included in the current profit and loss when they
actually occur.
35. Discontinued operation
Discontinued operation refers to a constituent part that meets one of the following conditions and can be
distinguished separately, and this constituent part has been disposed of or classified into the category held for sale:
(1) This constituent part represents an independent main business or a separate main business area;
(2) This constituent part is one part of an associated plan for disposing of an independent main business or a
separate main business area;
(3) This constituent part is a subsidiary specially acquired for resale.
The Company lists the continuous operation profit and loss and discontinued operation profit and loss in the
consolidated income statement and the income statement respectively. For the non-current asset or disposal group
held for sale that does not comply with the definition of discontinued operation, its impairment loss and reversed
amount and profit and loss from disposal shall be listed as continuous operation profit and loss. The impairment loss
and reversed amount of discontinued operation and other operation profits and losses and profits and losses from
disposal shall be listed as discontinued operation profits and losses.
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For the discontinued operation listed in the current period, in the current financial statements, the information
originally listed as continuous operation profit and loss is re-listed as discontinued operation profits and losses of the
comparable accounting period. Where the disposal group for discontinued use that is not for sale meets the condition
of the relevant constituent part in the definition of discontinued operation, it shall be listed as discontinued operation
from the date of discontinued use. Where the control right of a subsidiary is lost due to reasons such as selling the
investment into the subsidiary and this subsidiary complies with the definition of discontinued operation, the relevant
discontinued operation profits and losses shall be listed in the consolidated income statement.
36. Segment report
The Company determines the operating segment based on the internal organizational structure, management
requirements and internal reporting system, determines the report segment based on the operating segment, and
discloses the segment information.
The operating segment refers to the constituent part in the Company that meets the following conditions at the
same time:
(1) This constituent part can generate income and cost in daily activities;
(2) The management of the Company can regularly evaluate the operating results of the constituent part so as to
decide configuration of resources to it and evaluate its performance;
(3) The Company can obtain the relevant accounting information of this constituent part such as its financial
status, operating results and cash flows. If two or more operating segments have similar economic characteristics and
satisfy certain conditions, they can be combined into one operating segment.
37. Repurchase share
If the Company's shares are acquired due to the reduction of registered capital or employee rewards, the amount
actually paid shall be treated as the treasury share and registered at the same time for future reference. If the
repurchased share is canceled, the difference between the total share face value and amount paid for actual repurchase
calculated by the face value of the canceled share and number of shares canceled is used to offset the capital reserve.
If the capital reserve is insufficient to offset, the retained earnings shall be offset;
If the repurchased shares are used to reward the Company's employees as equity-settled share-based payment,
please refer to Note III. 30 "Share-based payment" for the corresponding accounting treatment.
38. Hedging
To avoid certain risks, the Company hedges certain financial instruments as hedging instruments. Hedge that
meets the prescribed conditions will be handled by the Company using hedge accounting methods. The Company's
hedging includes fair value hedge, cash flow hedge and hedge of net investment in overseas operations.
At the beginning of the hedging, the Company officially designates the hedging tool and the hedged item, and
prepares written documents on the hedging relationship and the risk management strategy and risk management
objectives of the Company engages in hedging. In addition, the Company will continue to assess the effectiveness of
the hedging when and after the hedging begins.
(1) Fair value hedge
For eligible hedging instruments designated as fair value hedge, the gains or losses generated thereby are
included in the current profits and losses. If a hedging instrument is hedged on a non-trading equity instrument
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investment (or its component) that is selected to be measured at fair value and of which changes are included in other
comprehensive income, the gains and losses generated thereby are included in other comprehensive income. Gain or
loss of a hedged item due to hedging risk exposure is included in the current profits and losses, while adjusting the
book value of the hedged item. If a hedged item is measured at fair value, the gain or loss of the hedged item due to
hedging risk exposure does not need to adjust the book value of the hedged item, and the related gain and loss are
included in the current profits or losses or other comprehensive income.
When the Company revokes the designation of the hedging relationship, the hedging instrument has expired or is
sold, the contract is terminated or exercised, or the conditions for the use of hedging accounting is no longer met, the
use of hedging accounting is terminated.
(2) Cash flow hedging
For eligible hedging instruments designated as cash flow hedge, the portion of the gains or losses generated
thereby that is determined to be an effective hedge is included in other comprehensive income, while the portion that
is determined to be an ineffective hedge is included in the current profits and losses.
If the expected transaction causes the Company to subsequently recognize a non-financial asset or non-financial
liability, or the expected transaction of the non-financial asset or non-financial liability forms a firm commitment
applicable to fair value hedge accounting, the Company will transfer out the amount of cash flow hedge reserve
originally recognized in other comprehensive income and includes it in the initial recognition amount of the asset or
liability. For other cash flow hedging, the Company will, during the same period in which the hedged expected cash
flow affects the profit or loss, transfer out the amount of cash flow hedge reserve originally recognized in other
comprehensive income and includes it in the current profits and losses.
If it is expected that all or part of the net loss originally included in other comprehensive income cannot be
compensated in the future accounting period, the portion which cannot be compensated will be transferred out and
included in the current profits and losses.
When the Company terminates the use of hedging accounting for cash flow hedges, the accumulated cash flow
hedge reserve that has been included in other comprehensive income will be retained when future cash flow
expectations still occur, and will be transferred out of other comprehensive income and included in the current profits
and losses when future cash flow expectations no longer occur.
(3) Hedge of net investment in an overseas operation
Hedge of net investment in overseas operations is accounted for using a method similar to the cash flow hedge.
Among the gains or losses of hedging instruments, the portion that is determined to be an effective hedge is included
in other comprehensive income, while the portion that is determined to be an ineffective hedge is included in the
current profits and losses.
Gains and losses that have been included in other comprehensive income will be transferred out of other
comprehensive income and included in the current profits and losses when disposing of overseas operations.
39. Safe production expense
Some subsidiaries of the Company withdraw the safety production costs in accordance with national regulations
and include them in the costs of related products or current profit or loss.
Where the expenses for production safety extracted are of a cost nature, the special reserves shall be directly
written off. If the expenses for safety production extracted are used to form fixed assets, the expenses incurred by the
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account collection of "construction in progress" shall be recognized as fixed assets when the safety project is
completed and reaches the expected serviceable state; at the same time, according to the cost of forming fixed assets,
special reserves shall be written down, and the same amount of accumulated depreciation shall be confirmed. The
fixed asset is no longer depreciated at a later stage.
40. Risk reserve
In accordance with the Administrative Measures for the Reserve Accrual of Financial Enterprises ("Accrual
Measures") (CJ [2012] No. 20) promulgated by the Ministry of Finance, the financial industry subsidiaries under the
Company establish general risk provisions on the basis of provision for preparation for the impairment of assets to
make up for potential losses related to risk assets that have not yet been recognized. This general risk preparation will
be treated as distribution of profits. It is an integral part of the owner's equity. In principle, it should not be less than
1.5% of the ending balance of risk assets. According to the requirements of the accrual measures, if the proportion of
the general preparation balance of financial enterprises in the ending balance of risk assets is difficult to reach 1.5%
at one time, it can be in place in years. In principle, it should not exceed 5 years.
41. Major accounting policies and accounting estimate changes
(1) Changes in important accounting policies
The Ministry of Finance issued the Accounting Standards for Business Enterprises No. 21 - Leases (Finance and
Accounting [2018] No. 35) on December 7, 2018, requiring companies listed at home and abroad at the same time
and companies listed overseas and adopting IFRS or Accounting Standards for Business Accounting to prepare
financial statements to implement from January 1, 2019; and requiring other domestic listed companies implementing
Accounting Standards for Business Enterprises to implement from January 1, 2021. The Company made
corresponding changes to its accounting policies in accordance with the requirements of the standard.
According to the provisions of the new lease criteria, for the contract that has existed prior to the first execution
date, the Company chooses not to re-evaluate whether it is lease or includes lease. Only the retained earnings at the
beginning of the period and other related statement items were adjusted on first-time implementation, and no
adjustments were made to comparable period information. The change in accounting policy did not have a significant
impact on the financial indicators of total assets, total liabilities, net assets and net profit of the Company.
The following shows adjustments to the financial statements at the beginning of the period of the first
implementation of the new lease standard for the first time starting from 2021:
Amount as at 31 December, 2020 (before change) Amount as at January 1, 2021 (after change)
Report Item
Consolidated Parent company's Consolidated Parent company's
Statements statement Statements statement
Non-current assets:
Usufruct assets 38,952,103.28
Long-term unamortized
8,567,923.50 1,954,062.19
expenses
Total non-current assets 65,584,936,463.61 49,231,239,643.63 65,617,274,705.58 49,231,239,643.63
Total assets 279,217,923,628.27 239,626,991,300.20 279,250,261,870.24 239,626,991,300.20
Current liabilities:
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Amount as at 31 December, 2020 (before change) Amount as at January 1, 2021 (after change)
Report Item
Consolidated Parent company's Consolidated Parent company's
Statements statement Statements statement
Non-current liabilities due
22,927,889.42
within one year
Total current liabilities 158,478,718,130.74 157,595,121,705.31 158,501,646,020.16 157,595,121,705.31
Non-current liabilities:
Lease liabilities 9,410,352.55
Total non-current liabilities 3,858,718,409.39 1,216,835,596.58 3,868,128,761.94 1,216,835,596.58
Total liabilities 162,337,436,540.13 158,811,957,301.89 162,369,774,782.10 158,811,957,301.89
Total liabilities and owner's
279,217,923,628.27 239,626,991,300.20 279,250,261,870.24 239,626,991,300.20
equity
(2) Changes of major accounting estimates
No.
Ⅵ Taxes
1. Main tax categories and tax rates
Category Tax Base Tax Rate
Added value from sales of goods or
Added-value tax 13.00%, 9.00%, 6.00%, etc.
provision of labor services
Urban maintenance &
Payable circulation tax 7.00%, 5.00%
construction tax
Educational
Payable circulation tax 3.00%
surcharges
Local education
Payable circulation tax 2.00%
surcharge
Business income tax Taxable income 34.00%, 25.00%, 20.00%, 16.50%, 15.00%, etc.
[Note] The place of business of the Company's subsidiary Hong Kong Gree Electric Appliances Sales Limited is
Hong Kong Special Administrative Region, and the profit tax rate of Hong Kong is 16.50%; the place of business of
the Company's subsidiaries Gree (Brazil) Electric Appliances Co., Ltd. and Brazil United Electric Appliances
Industry and Commerce Co., Ltd. is Brazil, and the federal enterprise income tax rate of Brazil is 34.00%.
2. Tax preferences
(1) The Company was registered in Zhuhai, Guangdong, and has been enjoying the preferential policy for the
high and new tech enterprises (High-tech Enterprise Certificate No. GR202044007307). The Company applied the
income tax rate of 15.00%, which is valid for 3 years.
(2) Deemed to be high and new tech enterprises, the following subsidiaries of the Company applied the
enterprise income tax rate of 15.00% in 2021
No Time for acquiring the Valid
Name of tax payer Certificate number
. certificate period
Three
1 Zhuhai Landa Compressor Co., Ltd. GR202044007788 December 9, 2020
years
Three
2 Zhuhai Gree Xinyuan Electronics Co., Ltd. GR201944009719 November 30, 2019
years
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No Time for acquiring the Valid
Name of tax payer Certificate number
. certificate period
Three
3 Zhuhai Kaibang Motor Manufacture Co., Ltd. GR202144007599 December 20, 2021
years
Three
4 Zhuhai Gree Daikin Precision Mold Co., Ltd. GR201944005454 December 2, 2019
years
Three
5 Gree Electric Appliances Appliance (Hefei) Co., Ltd GR202034000570 August 17, 2020
years
Gree Green Refrigeration Technology Center Co., Ltd. of Three
6 GR202044006403 December 9, 2020
Zhuhai years
Three
7 Gree (Wuhan) Electric Appliances Co., Ltd. GR201942003097 November 28, 2019
years
Three
8 Gree (Zhengzhou) Electric Appliances Co., Ltd. GR202041001002 September 9, 2020
years
Three
9 Gree (Wuhu) Electric Appliances Co., Ltd. GR202034002197 August 17, 2020
years
Three
10 Gree (Shi Jiazhuang) Electric Appliances Co., Ltd. GR201913002804 December 2, 2019
years
Three
11 Zhuhai EWP Information Technology Co., Ltd. GR201944005394 December 2, 2019
years
Three
12 Changsha Gree HVAC Equipment Co., Ltd. GR202043000055 September 11, 2020
years
Three
13 Zhuhai Gree Precision Mold Co., Ltd. GR202044007901 December 9, 2020
years
Three
14 GREE (Zhongshan) Household Appliances Co., Ltd. GR202044011848 December 9, 2020
years
Three
15 Hefei Kinghome Electrics Co., Ltd GR202134001678 September 18, 2021
years
Three
16 Zhuhai Gree New Material Co., Ltd. GR201944009559 December 2, 2019
years
Three
17 Gree (Shijiazhuang) Small Home Appliances Co., Ltd. GR201913002825 December 2, 2019
years
Three
18 Zhuhai Gree Dakin Device Co., Ltd. GR202144007849 December 20, 2021
years
Three
19 Zhuhai Gree Electormechanical Engineering Co., Ltd. GR202044011411 December 9, 2020
years
Three
20 Gree TOSOT (Suqian) Home Appliances Co., Ltd. GR202032012986 December 2, 2020
years
Three
21 Gree (Hangzhou) Electric Appliances Co., Ltd. GR202033001006 December 1, 2020
years
Three
22 Hefei Landa Compressor Co., Ltd. GR202034001654 August 17, 2020
years
Three
23 Zhengzhou Landa Compressor Co., Ltd. GR202041001848 December 4, 2020
years
Three
24 Wuhan Landa Compressor Co., Ltd. GR202042001716 December 1, 2020
years
Three
25 Hefei Kaibang Motor Manufacture Co., Ltd. GR202034002198 August 17, 2020
years
Three
26 Henan Kaibang Motor Manufacture Co., Ltd. GR202041000105 September 9, 2020
years
Three
27 Gree Electric Enterprises (Ma'anshan) Ltd. GR202034001625 August 17, 2020
years
Three
28 Gree Altairnano New Energy Inc. GR202144004177 December 20, 2021
years
Three
29 Zhuhai Guangtong Automobile Co., Ltd. GR202044009236 December 9, 2020
years
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No Time for acquiring the Valid
Name of tax payer Certificate number
. certificate period
Three
30 Zhuhai Gree Altairnano Electric Appliances, Inc. GR202144006478 December 20, 2021
years
Three
31 Chengdu Gree Titanium New Energy Inc. GR201951002380 November 28, 2019
years
Three
32 Hebei Gree Titanium New Energy Inc. GR201913001838 October 30, 2019
years
Three
33 Northern Aotai Nanotechnology Co., Ltd. GR202113001126 September 18, 2021
years
(3) The following subsidiaries of the Company enjoy the country's western development policy, and applied the
income tax rate of 15.00%.
No. Name of tax payer Start time
1 Gree (Chongqing) Electric Appliances Co., Ltd. January 1, 2008
2 Chongqing Landa Compressor Co., Ltd. January 1, 2015
3 Chongqing Kaibang Motor Manufacture Co., Ltd. January 1, 2013
4 Chengdu Gree Xinhui Medical Equipment Co., Ltd. April 8, 2020
5 Chengdu Guangtong Automobile Co., Ltd. June 13, 2017
Ⅴ Items in consolidated financial statements
For the following note items (including notes to the main items of the parent company's financial statements),
unless otherwise specified, "the beginning of the period" means January 1, 2021, "the end of the period" means
December 31, 2021, and "the end of the previous year" means December 31, 2020, "the current year" refers to 2021,
and "the previous year" refers to 2020. Unless otherwise stated, the amount unit is Yuan.
1. Monetary funds
Item Balance at the end of the period Beginning balance
Cash on hand 1,021,935.16 468,623.79
Bank deposits 37,248,838,390.03 78,022,377,237.18
Other monetary capital [Note 1] 36,207,001,226.17 18,693,373,853.14
Deposits in central bank [Note 2] 1,406,034,172.78 2,039,998,699.60
Deposits in other banks 38,791,111,355.15 35,190,517,674.79
Subtotal 113,654,007,079.29 133,946,736,088.50
Accrued interest 3,285,291,697.58 2,466,407,771.31
Total 116,939,298,776.87 136,413,143,859.81
Including: Total amount deposited abroad 341,734,386.47 637,626,876.23
[Note 1] The balance at the end of the period of other monetary capital refers to banks' acceptance bill deposits,
guarantee deposits, letter of credit deposits, etc., where the restricted fund was RMB 35,924,841,935.70;
[Note 2] The statutory deposit reserve in the Company's deposits in central bank are RMB 1,403,981,413.43,
and its use is restricted;
[Note 3] Except the above situations, there are no other funds in the end-of-period balance of monetary funds
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that have limited use and potential recovery risks due to mortgage, pledge or freezing.
2. Trading financial liabilities
Balance at the end of
Item Beginning balance
the period
Financial assets which are measured at their fair values and of which the changes
370,820,500.00
are included into other comprehensive income
Including: Debt instrument investment 370,820,500.00
Total 370,820,500.00
3. Derivative financial assets
Item Balance at the end of the period Beginning balance
Forward foreign exchange
198,773,198.65 285,494,153.96
settlement/sale
Total 198,773,198.65 285,494,153.96
4. Accounts receivable
(1) Accounts receivables are disclosed by account age
Account age Balance at the end of the period
Within 1 year 12,223,311,908.11
1 ~ 2 years 1,097,130,089.53
2 to 3 years 654,718,975.22
Over 3 years 2,131,328,023.16
Subtotal 16,106,488,996.02
Less: Bad debt provisions 2,265,590,193.26
Total 13,840,898,802.76
[Note] The Company's accounts receivable with the account age of over 1 year are mainly subsidy receivables
for dismantling waste electrical and electronic products and payment for new energy vehicles.
(2) Disclosure of accounts receivable classification
Balance at the end of the period
Category Book balance Bad debt provision
Book value
Percentage Credit loss
Amount Amount
(%) rate (%)
Accounts receivable with bad debt
1,293,262,223.96 8.03 1,029,353,603.16 79.59 263,908,620.80
provisions accrued separately
Accounts receivable with bad debt
provisions accrued according to 14,813,226,772.06 91.97 1,236,236,590.10 8.35 13,576,990,181.96
the combination
Including: account age
12,433,046,350.06 77.19 1,041,853,417.60 8.38 11,391,192,932.46
combination
Low risk combination 2,380,180,422.00 14.78 194,383,172.50 8.17 2,185,797,249.50
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Balance at the end of the period
Category Book balance Bad debt provision
Book value
Percentage Credit loss
Amount Amount
(%) rate (%)
Total 16,106,488,996.02 100.00 2,265,590,193.26 14.07 13,840,898,802.76
(Continued)
Beginning balance
Category Book balance Bad debt provision
Book value
Percentage Credit loss rate
Amount Amount
(%) (%)
Accounts receivable with bad debt
125,518,248.51 1.32 125,518,248.51 100.00
provisions accrued separately
Accounts receivable with bad debt
provisions accrued according to the 9,365,829,735.59 98.68 627,598,830.15 6.70 8,738,230,905.44
combination
Including: account age
7,773,779,870.59 81.91 484,681,830.93 6.23 7,289,098,039.66
combination
Low risk combination 1,592,049,865.00 16.77 142,916,999.22 8.98 1,449,132,865.78
Total 9,491,347,984.10 100.00 753,117,078.66 7.93 8,738,230,905.44
1) Accounts receivable for which bad debt reserves are accrued individually:
Balance at the end of the period
Name
Reason for
Book balance Bad debt provision Credit loss rate (%)
appropriation
It is expected to be
43 units in total 1,293,262,223.96 1,029,353,603.16 79.59 difficult to recover in
full
Total 1,293,262,223.96 1,029,353,603.16 79.59
2) In the combination, the accounts receivable with bad debt provisions accrued by account age combination:
Account age Book balance Bad debt provision Credit loss rate (%)
Within 1 year 11,116,991,920.25 555,849,596.19 5.00
1 ~ 2 years 475,779,000.79 86,302,607.06 18.14
2 to 3 years 223,686,004.19 62,249,391.62 27.83
Over 3 years 616,589,424.83 337,451,822.73 54.73
Total 12,433,046,350.06 1,041,853,417.60 8.38
[Note] The changes in the expected credit loss rate of aging combination in this period are caused by the
company combination not under the same control.
3) In the combination, the accounts receivable with bad debt provisions accrued by low risk combination
Balance at the end of the period
Name
Book balance Bad debt provision Credit loss rate (%)
Low risk combination 2,380,180,422.00 194,383,172.50 8.17
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Balance at the end of the period
Name
Book balance Bad debt provision Credit loss rate (%)
Total 2,380,180,422.00 194,383,172.50 8.17
(3) Changes in the bad-debt provision in this period
Change of the current period
Beginning Balance at the end
Category Changes in the
balance Recovered or of the period
scope of Appropriation Wrote-off
reversed
combination
Single
125,518,248.51 906,365,112.59 2,529,757.94 1,029,353,603.16
accrual
Account age
484,681,830.93 406,611,041.33 150,772,299.04 211,753.70 1,041,853,417.60
combination
Low risk
142,916,999.22 28,462,574.33 23,003,598.95 194,383,172.50
combination
Total 753,117,078.66 1,341,438,728.25 173,775,897.99 2,529,757.94 211,753.70 2,265,590,193.26
[Note] There was no significant recovery or reversal of bad debt provisions during the current period.
(4) Particulars on accounts receivable actually wrote-off in the current period
Item Wrote-off amount
6 units in total 211,753.70
Total 211,753.70
(5) Accounts receivable of top 5 debtors in the balance at the end of the period collected by the debtor
Percentage (%) in the total
Balance at the end of the period Balance of provision for bad debts at
Name of entity balance at the end of the period
of accounts receivable the end of the period
of accounts receivable
First 1,610,790,135.00 10.00 165,143,601.52
Second 1,099,252,494.86 6.82 54,962,624.56
Third 769,390,287.00 4.78 29,239,570.98
Fourth 497,718,000.00 3.09 24,885,900.00
Fifth 368,451,389.27 2.29 18,422,569.45
Total 4,345,602,306.13 26.98 292,654,266.51
(6) Accounts receivable derecognized due to the transfer of financial assets
No.
(7) Assets and liabilities formed due to the transfer and continuous involvement of accounts receivable
No.
5. Receivable financing
(1) Receivables financing classified and listed
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Balance at the end of the
Item Beginning balance
period
Notes receivable measured at fair value
Including: Bank acceptance bills 25,612,056,693.07 20,972,269,154.21
Including: Notes accepted by Gree Finance Company 804,781,351.78 1,105,774,342.96
Commercial acceptance bill 1,135,441.28
Total 25,612,056,693.07 20,973,404,595.49
(2) Receivables financing pledged by the Company at the end of the period
Item Pledged amount at the end of the period
Bank acceptance bills 12,911,461,792.08
Total 12,911,461,792.08
(3) Receivables financing that has been endorsed or discounted by the Company at the end of the period but
not yet due at the balance sheet date
Amount whose recognition is Amount whose recognition is not terminated
Item
terminated at the end of the period at the end of the period
Bank acceptance bills 23,818,750,252.14 840,000,000.00
Commercial acceptance bill 12,128,009.63
Total 23,818,750,252.14 852,128,009.63
(4) Receivables financing transferred by the Company into accounts receivable due to the note issuer's failure
of performance
No.
(5) Receivables financing actually wrote off in the current period
No.
6. Advance payments
(1) The prepayments are listed by account age as follows
Balance at the end of the period Beginning balance
Account age
Amount Percentage (%) Amount Percentage (%)
Within 1 year 4,500,793,847.23 98.02 3,103,519,802.42 99.18
1 ~ 2 years 21,906,080.13 0.48 17,658,164.08 0.56
2 to 3 years 24,927,433.26 0.54 5,665,338.67 0.18
Over 3 years 44,259,156.72 0.96 2,358,698.07 0.08
Total 4,591,886,517.34 100.00 3,129,202,003.24 100.00
[Note] The changes in the age structure of advance payment in this period are caused by business combination
not under the same control.
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(2) Advance payment aged over one year and significant amount in this period
No.
(3) Prepayments of top 5 prepayment objects in the balance at the end of the period collected by the
prepayment object
The aggregate balance amount of prepayments of top 5 suppliers in the balance at the end of the period collected
by the supplier was RMB 2,496,164,550.08, accounting for 54.36% of the total balance of prepayments at the end of
the period.
7. Other receivables
Item Balance at the end of the period Beginning balance
Dividends receivable 615,115.33
Other receivables [Note 1] 333,546,754.85 147,338,547.86
Total 334,161,870.18 147,338,547.86
[Note 1] Other receivables in the table above refer to other receivables after deduction of interest receivables and
dividends receivable;
[Note 2] The Company has no interest receivable balance at the end and the beginning of the period.
(1) Dividends receivable
1) Classification of dividends receivable
Balance at the end of the
Item Beginning balance
period
Dividends receivable 615,115.33
Total 615,115.33
2) Significant dividends receivable aged over 1 year
No.
(2) Other receivables
1) Other receivables classified by nature
Balance at the end of the
Nature of money Beginning balance
period
Current and low-risk payments 487,589,373.01 165,954,624.87
Less: Bad debt provisions 154,042,618.16 18,616,077.01
Total 333,546,754.85 147,338,547.86
2) Accrual of bad debt reserves
Phase I Phase 2 Phase 3
Bad debt provision Expected credit Expected credit loss for the Expected credit loss for the Total
losses in the next entire duration (no credit entire duration (credit
12 months impairment occurred) impairment occurred)
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Phase I Phase 2 Phase 3
Bad debt provision Expected credit Expected credit loss for the Expected credit loss for the Total
losses in the next entire duration (no credit entire duration (credit
12 months impairment occurred) impairment occurred)
Balance as at January 1, 2021 7,377,897.43 11,238,179.58 18,616,077.01
Changes in the scope of
6,744,383.37 124,278,371.61 131,022,754.98
combination in this period
Appropriation for the current
7,620,570.28 7,620,570.28
period
Reserved in the current
3,158,127.91 3,158,127.91
period
Wrote-off in the current
36,392.38 22,263.82 58,656.20
period
Balance on December 31,
10,927,760.51 143,114,857.65 154,042,618.16
2021
3) Disclosure by aging
Account age Book balance
Within 1 year 223,370,210.02
1 ~ 2 years 66,464,345.41
2 to 3 years 95,316,990.94
Over 3 years 102,437,826.64
Subtotal 487,589,373.01
Less: Bad debt provisions 154,042,618.16
Total 333,546,754.85
4) Bad debt reserves accrued, recovered or reversed in the current period
Change of the current period
Balance at the end of
Category Beginning balance
Changes in the scope the period
Accrual/reversal Wrote-off
of combination
Single accrual 73,373,158.79 2,527,264.75 75,900,423.54
Account age
17,944,577.01 57,649,596.19 2,547,427.62 58,656.20 78,082,944.62
combination
Low risk
671,500.00 -612,250.00 59,250.00
combination
Total 18,616,077.01 131,022,754.98 4,462,442.37 58,656.20 154,042,618.16
[Note] There is no significant recovery or reversal of bad debt provisions during the current period.
5) Other receivables actually wrote off in the current period
Item Wrote-off amount
4 units in total 58,656.20
[Note] There was no significant writing-off of other receivables during the current period.
6) Other receivables of top 5 debtors in the balance at the end of the period collected by the debtor
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Proportion to the total Balance of
Nature of Balance at the balance of other provision for bad
Name of entity Account age
money end of the period receivables at the end of debts at the end of
the period (%) the period
Intercourse
First 77,016,600.00 2 to 3 years 15.80 19,255,186.18
funds
Intercourse 1 to 3 years, 3 years
Second 40,312,312.68 8.27 40,312,312.68
funds or more
Intercourse
Third 36,017,222.73 Within 1 year 7.39 1,800,861.14
funds
Intercourse
Fourth 23,019,791.78 Over 3 years 4.72 23,019,791.78
funds
Intercourse
Fifth 20,050,000.00 Within 1 year 4.11 1,002,500.00
funds
Total 196,415,927.19 40.29 85,390,651.78
7) Receivables involving government subsidies
No.
8) Other receivables derecognized due to the transfer of financial assets
No.
9) Assets and liabilities formed due to the transfer and continuous involvement of other receivables
No.
8. Inventory
(1) Classification of inventories
Balance at the end of the period
Inventory depreciation
Item provision or
Book balance Book value
provision for impairment of
contract performance cost
Raw material 11,013,706,175.31 844,318,692.51 10,169,387,482.80
Goods in process and contract
1,974,184,596.76 1,974,184,596.76
performance cost
Finished goods 27,845,565,162.22 1,296,652,950.63 26,548,912,211.59
Development cost 4,073,114,036.86 4,073,114,036.86
Total 44,906,569,971.15 2,140,971,643.14 42,765,598,328.01
(Continued)
Beginning balance
Falling price reserve of
Item
inventory or impairment
Book balance Book value
reserves of contract
performance cost
Raw material 8,959,268,217.85 388,954,526.10 8,570,313,691.75
Goods in process and contract
2,046,139,363.33 2,046,139,363.33
performance cost
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Beginning balance
Falling price reserve of
Item
inventory or impairment
Book balance Book value
reserves of contract
performance cost
Finished goods 15,761,579,871.16 108,259,680.25 15,653,320,190.91
Development cost 1,609,731,913.40 1,609,731,913.40
Total 28,376,719,365.74 497,214,206.35 27,879,505,159.39
(2) Provision for the loss on decline in value of inventories
Increased amount in Decreased amount in
Increase in the the current period the current period Balance at the end
Item Beginning balance
combination scope of the period
Appropriation Write-off amount
Raw material 388,954,526.10 450,926,043.68 120,560,679.83 116,122,557.10 844,318,692.51
Finished goods 108,259,680.25 866,222,164.30 349,919,336.20 27,748,230.12 1,296,652,950.63
Total 497,214,206.35 1,317,148,207.98 470,480,016.03 143,870,787.22 2,140,971,643.14
Specific bases for making a provision for decline in value of inventories and reasons of reversing or writing off
the provision for decline in value of inventories in the current period:
Specific basis for making a provision for decline in value of Writing off the provision for decline in value
Item
inventories of inventories in the current period
Raw material The lower of the inventory cost and net realizable value Applied for or sold in the current period
Finished goods The lower of the inventory cost and net realizable value Sold in the current period
(3) The inventory balance at the end of the period did contain capitalized amounts of borrowing costs
No.
(4) Amortization amount of the current period of contract performance cost: The amortized contract
performance cost in the current period is 109,805,808.67 yuan.
9. Contract assets
(1) Contract assets are disclosed by account age
Account age Balance at the end of the period
Within 1 year 417,335,707.89
1 ~ 2 years 279,122,410.83
2 to 3 years 368,013,139.80
Over 3 years 480,647,482.82
Subtotal 1,545,118,741.34
Less: provision for impairment 393,890,268.71
Total 1,151,228,472.63
(2) Contract assets are disclosed by category
232
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Balance at the end of the period Beginning balance
Item
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Account age
721,024,117.34 115,256,697.58 605,767,419.76 91,786,834.71 13,241,309.11 78,545,525.60
combination
Low risk
824,094,624.00 278,633,571.13 545,461,052.87
combination
Total 1,545,118,741.34 393,890,268.71 1,151,228,472.63 91,786,834.71 13,241,309.11 78,545,525.60
(3) Particulars on impairment provisions accrued for contract assets in the current period:
Increase in the Appropriation for Reserved in the Balance at the
Item Beginning balance
combination scope the current period current period end of the period
Low risk combination 279,915,098.02 1,281,526.89 278,633,571.13
Account age
13,241,309.11 72,146,394.86 29,868,993.61 115,256,697.58
combination
Total 13,241,309.11 352,061,492.88 29,868,993.61 1,281,526.89 393,890,268.71
10. Non-current assets due within one year
Item Balance at the end of the period Beginning balance Remark
Other debt investments due within one year 10,860,197,639.98
Long-term receivables due within one year 3,406,416.52
Subtotal 10,863,604,056.50
Accrued interest of other debt investments due
169,967,876.10
within one year
Total 11,033,571,932.60
11. Other current assets
Item Balance at the end of the period Beginning balance
Monetary investment products 5,460,000,000.00 8,274,000,000.00
Input tax to be deducted and prepaid tax 2,786,329,636.97 2,532,692,156.12
Notes which have been endorsed or discounted
852,128,009.63 4,588,589,780.94
but not yet due
Others 282,434,079.34 104,308,689.13
Subtotal 9,380,891,725.94 15,499,590,626.19
Add: Accrued interests 21,626,670.32 117,711,287.68
Less: Preparation for impairment of other
20,340,809.19
mobile assets
Total 9,382,177,587.07 15,617,301,913.87
12. Disbursement of loans statements and advances
(1) Distribution of enterprises and individuals
Item Balance at the end of the period Beginning balance
233
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Item Balance at the end of the period Beginning balance
Disbursement of loans statements and
advances measured at amortized costs:
Disbursement of corporate loans and advances 4,247,674,817.07 5,403,251,177.80
Including: (1) Loan 1,052,040,000.00 3,857,680,000.00
(2) Discount 3,195,634,817.07 1,545,571,177.80
Including: discount asset interest
-31,355,182.93 -7,547,171.66
adjustment
Less: loan loss provision 106,975,750.00 135,269,958.74
Including: combined appropriation 106,975,750.00 135,269,958.74
Subtotal 4,140,699,067.07 5,267,981,219.06
Accrued interest 1,953,834.78 5,824,362.46
Book value of disbursement of corporate loans
4,142,652,901.85 5,273,805,581.52
and advances
(2) Changes in loss provision for loans
Item Balance at the end of the period Beginning balance
Disbursement of loans statements and
advances measured at amortized costs:
Beginning balance 135,269,958.74 369,304,393.78
Appropriation for the current period -28,294,208.74 -234,034,435.04
Balance at the end of the period 106,975,750.00 135,269,958.74
13. Other debt investments
(1) Particulars on other debt investments
Balance at the end of the period
Accumulated
loss
Items provisions
Accrued Fair value
Cost Book value recognized in
interest changes
other
comprehensi
ve income
Treasuries 294,120,614.59 3,378,082.20 7,448,985.41 304,947,682.20
Corporate bonds 469,153,368.80 6,880,882.18 7,002,641.18 483,036,892.16
17,100,000,000. 354,467,166.6 17,454,467,166.
Transferable certificate of deposit [Note]
00 7 67
17,863,273,983. 364,726,131.0 18,242,451,741.
Subtotal 14,451,626.59
39 5 03
Less: Other debt investment due within one 10,859,752,569. 169,967,876.1 11,030,165,516.
445,070.72
year 26 0 08
1,300,000,000.0 1,302,229,333.3
Less: Other current assets 2,229,333.33
0 3
5,703,521,414.1 192,528,921.6 5,910,056,891.6
Total 14,006,555.87
3 2 2
(Continued)
234
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Beginning balance
Accumulated loss
provisions
Item recognized in
Cost Accrued interest Fair value changes Book value
other
comprehensive
income
Treasuries 292,922,755.76 3,378,082.20 2,565,844.24 298,866,682.20
Corporate bonds 199,243,635.63 1,890,410.97 2,201,564.37 203,335,610.97
Total 492,166,391.39 5,268,493.17 4,767,408.61 502,202,293.17
[Note] The transferable certificate of deposit held by the Company is classified as financial assets measured at
fair value and whose changes are included in other comprehensive income according to the management's intention
and the cash flow of contract, and listed as other debt investment, other mobile assets, and non-current assets due
within one year according to its liquidity. On December 31, 2021, there was no significant difference between the
cost of the Company's transferable certificate of deposit and fair value.
(2) Important debt investment
Balance at the end of the period Beginning balance
Real
Other debt items Real Coupon
Coupon interest
Face value interest Date due Face value rate Date due
rate (%) rate
rate (%) (%)
(%)
16. Interest-bearing August 4, August 4,
200,000,000.00 2.74 3.10 200,000,000.00 2.74 3.10
treasuries 17 2026 2026
16. Interest-bearing August 4, August 4,
100,000,000.00 2.74 3.44 100,000,000.00 2.74 3.44
treasuries 17 2026 2026
September September
20 Nongfa 08 200,000,000.00 3.45 3.54 200,000,000.00 3.45 3.54
23, 2025 23, 2025
19 Huafa Group December
50,000,000.00 4.57 5.00
MTN007 6, 2022
19 Huafa Group December
10,000,000.00 4.57 5.10
MTN007 6, 2022
19 Huafa Group December
10,000,000.00 5.30 5.31
MTN008B 11, 2024
21 Huafa Group June 28,
200,000,000.00 4.65 4.65
MTN007 2024
January
Transferable 14, 2022 to
17,100,000,000.00 3.35-4.18 3.35-4.18
certificate of deposit December
9, 2024
Total 17,870,000,000.00 500,000,000.00
14. Long-term receivables
Balance at the end of the period
Item
Book balance Bad debt provision Book value
Goods sold on installment 38,157,391.25 20,340,809.19 17,816,582.06
Less: Unrealized financing income 844,248.07 844,248.07
235
2021 Annual Report of GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI.Annual Report 2021
Balance at the end of the period
Item
Book balance Bad debt provision Book value
Less: Long-term account receivable due within one year 3,406,416.52 3,406,416.52
Less: Reclassified to other mobile assets 31,487,695.59 20,340,809.19 11,146,886.40
Total 2,419,031.07 2,419,031.07
236
15. Long-term equity investments
Beginning balance Increase/Decrease in the current period Balance at the end of the period
Investment
gains and Adjustment of Declaration and
Name of invested entities Changes in the losses
Provision for Decreased other distribution of Provision for
Original value scope of recognized Original value
impairment investment comprehensive cash dividends impairment
combination
under equity incomes or profits
law
I. Joint venture
Six companies including Songyuan
Grain Group Jiangwan Rice Industry 1,145,000.00 75,914.19 1,220,914.19
Co., Ltd. [Note]
Subtotal 1,145,000.00 75,914.19 1,220,914.19
Ⅱ. Associates
Gree (Vietnam) Electric Appliances,
1,940,009.35 1,940,009.35 1,940,009.35 1,940,009.35
Inc.
Liaowang All Media Communication
36,052,960.09 1,332,591.91 37,385,552.00
Co., Ltd.
Beijing Gree Technology Co., Ltd. 2,294,251.09 -237,069.32 2,057,181.77
Chongqing Pargo Mechanical
11,249,230.03 13,498,800.00 2,249,569.97
Equipment Co., Ltd.
Wuhan Digital Design and
Manufacturing Innovation Center 14,729,087.92 212,951.68 14,942,039.60
Co., Ltd.
Hunan Guoxin Semiconductor
20,099,845.47 13,817.45 108,922.33 20,004,740.59
Technology Co., Ltd.
Zhuhai Ronglin Equity Investment
7,061,709,059.56 -18,046,764.90 1,849,833,156.32 8,893,495,450.98
Partnership (Limited Partnership)
Henan Yuze Finance Leasing Co.,
51,286,191.75 1,569,732.71 1,106,576.00 51,749,348.46
Ltd.
Zhuhai Hanling Equity Investment
922,420,436.23 53,187,718.56 55,127,991.72 920,480,163.07
Partnership (Limited Partnership)
237
Beginning balance Increase/Decrease in the current period Balance at the end of the period
Investment
gains and Adjustment of Declaration and
Name of invested entities Changes in the losses
Provision for Decreased other distribution of Provision for
Original value scope of recognized Original value
impairment investment comprehensive cash dividends impairment
combination
under equity incomes or profits
law
Lanzhou Guangtong New Energy
101,054,678.56 8,076,320.55 -685,328.00 108,445,671.11
Automobile Co., Ltd.
Guizhou Qianzhixing New Energy
2,682,419.83 92,796.23 2,775,216.06
Co., Ltd.
Ningxia Nenggu New Energy
443,125.41 -99,262.34 343,863.07
Technology Co., Ltd.
Eocell Limited 7,284,782.90 -2,144,270.51 5,140,512.39
Beijing Liyin Automobile
4,605,056.55 4,605,056.55
Technology Co., Ltd.
Sichuan Jinshi Leasing Co., Ltd. 271,108,603.86 5,310,882.64 276,419,486.50
Subtotal 8,121,781,071.49 1,940,009.35 387,178,667.11 13,498,800.00 51,519,014.63 1,849,147,828.32 58,400,671.82 10,337,727,109.73 1,940,009.35
Total 8,121,781,071.49 1,940,009.35 388,323,667.11 13,498,800.00 51,594,928.82 1,849,147,828.32 58,400,671.82 10,338,948,023.92 1,940,009.35
[Note] For the disposal of 6 companies including Songyuan Grain Group Jiangwan Rice Industry Co., Ltd., please refer to Note VI. 4 "Disposal of subsidiaries".
238
16. Other equity instruments investments
(1) Particulars on other equity instrument investments
Item Balance at the end of the period Beginning balance
Shanghai Highly (Group) Co., Ltd. 755,079,703.46 667,802,216.81
Xinjiang Joinworld Company Limited 217,422,947.74 215,172,336.36
Wingtech Technology Co., Ltd. [Note 1] 4,636,568,053.50 3,550,040,505.00
RSMACALLINE-HSHS 195,769,835.63 254,461,858.93
San'an Optoelectronics Co., Ltd. [Note 2] 4,302,405,489.72 3,093,928,974.37
COFCO Trading (Suibin) Agricultural
7,000,000.00 7,000,000.00
Development Co., Ltd.
Total 10,114,246,030.05 7,788,405,891.47
[Note 1] The Company directly holds 35,858,995 shares of Wingtech Technology Co., Ltd., and the sale of such
shares is restricted for 36 months from October 2019.
[Note 2] The Company directly holds 114,547,537 shares of San'an Optoelectronics Co., Ltd., and the sale of
such shares is restricted for 36 months from June 2020.
(2) Particulars on non-trading equity instrument investment
Reason for the
amount
Other transferred
comprehensive Reason for from other
income designation as comprehensive
Dividend
Accumulated Cumulative at fair value income into
Item Name income Amount
gains losses through other retained
recognized transferred to comprehensive earnings
retained income
earnings
According to
the
Shanghai Highly management's
14,411,825.47 386,430,427.61
(Group) Co., Ltd. intention and
contractual
cash flow
According to
the
management's
RSMACALLINE-HSHS 444,254,984.68
intention and
contractual
cash flow
According to
the
Wingtech Technology management's
5,916,734.18 3,751,568,056.90
Co., Ltd. intention and
contractual
cash flow
According to
Xinjiang Joinworld the Sales of some
3,918,701.49 105,586,941.75 114,949,817.60
Company Limited management's stocks
intention and
239
Reason for the
amount
Other transferred
comprehensive Reason for from other
income designation as comprehensive
Dividend
Accumulated Cumulative at fair value income into
Item Name income Amount
gains losses through other retained
recognized transferred to comprehensive earnings
retained income
earnings
contractual
cash flow
According to
the
San'an Optoelectronics management's
17,182,130.55 2,302,405,489.72
Co., Ltd. intention and
contractual
cash flow
According to
the
COFCO Trading
management's
(Suibin) Agricultural 1,448,000.00
intention and
Development Co., Ltd.
contractual
cash flow
Total 42,877,391.69 6,159,560,488.37 830,685,412.29 114,949,817.60
17. Other non-current financial assets
Balance at the end of the
Item Beginning balance
period
Financial assets which are measured at their fair values and of which the
81,309,327.39 2,003,483,333.33
changes are included into other comprehensive income
Total 81,309,327.39 2,003,483,333.33
18. Investment real estate
Investment real estate using cost measurement model
Item Houses and buildings Total
I. Total of original carrying amount
1. Beginning balance 706,658,435.30 706,658,435.30
2. Increased amount in current period 67,357,852.46 67,357,852.46
Including: Transfer-in from construction in progress 3,856,543.64 3,856,543.64
Business combination increase 63,501,308.82 63,501,308.82
3. Amount decreased in the current period
4. Ending balance 774,016,287.76 774,016,287.76
II. Accumulated depreciation and accumulated amortization
1. Beginning balance 243,237,573.91 243,237,573.91
2. Increased amount in current period 75,923,891.22 75,923,891.22
240
Item Houses and buildings Total
Including: appropriation or amortization 42,857,231.40 42,857,231.40
Business combination increase 33,066,659.82 33,066,659.82
3. Amount decreased in the current period
4. Ending balance 319,161,465.13 319,161,465.13
III. Provision for impairment
IV. Carrying amount
1. Book value at the end of the period 454,854,822.63 454,854,822.63
2. Book value at the beginning of the period 463,420,861.39 463,420,861.39
[Note] As of December 31, 2021, the book value of investment real estate - houses and buildings of which the
Company has not obtained the property ownership certificates was RMB 46,525,035.59.
241
19. Fixed assets
Item Balance at the end of the period Beginning balance
Fixed assets [Note] 31,183,285,286.03 18,983,485,128.88
Fixed assets in liquidation 5,440,856.96 7,039,959.06
Total 31,188,726,142.99 18,990,525,087.94
[Note] The fixed assets in the table above refer to the fixed assets after deduction of the fixed assets in liquidation.
(1) Information of fixed assets
Transportation
Item Houses and buildings Machinery equipment Electronic equipment Other equipment Total
equipment
I. Total of original carrying amount:
1. Beginning balance 17,304,790,191.65 16,739,570,987.42 1,168,546,991.86 1,696,626,020.86 502,623,927.59 37,412,158,119.38
2. Increased amount in current period 9,710,894,812.73 8,246,492,826.56 180,145,760.74 450,112,870.37 280,075,404.66 18,867,721,675.06
Including: (1) Purchase 4,453,637.33 929,053,433.28 62,106,561.69 287,036,850.51 83,056,784.42 1,365,707,267.23
(2) Transfer-in from construction in
3,977,111,042.23 460,072,431.30 4,437,183,473.53
progress
(3) Increase by business combination 5,729,330,133.17 6,857,366,961.98 118,039,199.05 163,076,019.86 197,018,620.24 13,064,830,934.30
3. Decreased amount in current period 130,197,050.73 19,918,270.13 18,282,517.97 8,397,536.00 176,795,374.83
Including: Disposal or scrapping 130,197,050.73 19,918,270.13 18,282,517.97 8,397,536.00 176,795,374.83
4. Difference arising from translation of
-9,510,888.19 -4,391,313.92 -195,041.33 -262,606.71 -167,273.80 -14,527,123.95
financial statements in foreign currency
5. Ending balance 27,006,174,116.19 24,851,475,449.33 1,328,579,441.14 2,128,193,766.55 774,134,522.45 56,088,557,295.66
II. Accumulated depreciation
1. Beginning balance 5,471,702,676.23 10,176,319,528.39 862,969,705.20 1,522,777,567.14 378,141,308.28 18,411,910,785.24
2. Increased amount in current period 1,971,102,824.69 3,835,185,358.72 240,475,124.77 351,525,719.45 218,242,927.57 6,616,531,955.20
242
Transportation
Item Houses and buildings Machinery equipment Electronic equipment Other equipment Total
equipment
Including: (1) Appropriation 1,021,472,481.42 1,903,203,855.74 156,246,465.72 235,321,835.34 87,378,510.22 3,403,623,148.44
(2) Business combination increased 949,630,343.27 1,931,981,502.98 84,228,659.05 116,203,884.11 130,864,417.35 3,212,908,806.76
3. Decreased amount in current period 96,268,974.60 18,383,962.97 16,965,952.05 4,983,671.65 136,602,561.27
Including: Disposal or scrapping 96,268,974.60 18,383,962.97 16,965,952.05 4,983,671.65 136,602,561.27
4. Difference arising from translation of
-600,096.15 -2,168,714.12 -124,183.41 -133,129.70 -78,543.50 -3,104,666.88
financial statements in foreign currency
5. Ending balance 7,442,205,404.77 13,913,067,198.39 1,084,936,683.59 1,857,204,204.84 591,322,020.70 24,888,735,512.29
III. Provision for impairment
1. Beginning balance 13,788,472.27 2,694,962.53 8,282.39 131,160.63 139,327.44 16,762,205.26
2. Increased amount in current period
3. Decreased amount in current period 34,136.43 8,282.39 95,587.13 - 138,005.95
Including: Disposal or scrapping 34,136.43 8,282.39 95,587.13 - 138,005.95
4. Difference arising from translation of
-87,701.97 -87,701.97
financial statements in foreign currency
5. Ending balance 13,788,472.27 2,573,124.13 35,573.50 139,327.44 16,536,497.34
IV. Carrying amount
1. Ending book value 19,550,180,239.15 10,935,835,126.81 243,642,757.55 270,953,988.21 182,673,174.31 31,183,285,286.03
2. Beginning book value 11,819,299,043.15 6,560,556,496.50 305,569,004.27 173,717,293.09 124,343,291.87 18,983,485,128.88
[Note] As of December 31, 2021, the book value of fixed assets - houses and buildings that the Company has not obtained the property ownership certificates was RMB
10,961,925,644.13.
243
(2) Information of temporary idle fixed assets
No.
(3) Information of fixed assets leased out through operating leases
No.
(4) Fixed assets in liquidation
Item Balance at the end of the period Beginning balance
Fixed assets in liquidation 5,440,856.96 7,039,959.06
Total 5,440,856.96 7,039,959.06
20. Construction in progress
Item Balance at the end of the period Beginning balance
Construction in Progress [Note] 6,481,236,333.38 4,016,082,730.07
Total 6,481,236,333.38 4,016,082,730.07
[Note] The construction in progress in the above table refers to the construction in progress after deduction of
engineering materials.
(1) Construction in Progress
Balance at the end of the period Beginning balance
Item Provision
Provision for
Book balance Book value Book balance for Book value
impairment
impairment
Gree Altairnano
2,267,183,174.63 54,413.75 2,267,128,760.88
Project
Gree HQ project 907,483,903.01 907,483,903.01 570,077,306.55 570,077,306.55
Gree Gaolan Port
661,759,431.04 661,759,431.04 62,939,878.48 62,939,878.48
Project
Gree Nanjing
579,446,466.90 579,446,466.90 1,141,086,342.69 1,141,086,342.69
Project
Gree Chengdu
419,085,010.72 419,085,010.72 260,766,823.26 260,766,823.26
Project
Intelligent
Equipment 293,302,450.67 293,302,450.67 2,003,175.80 2,003,175.80
Project
Gree Energy
258,133,665.03 258,133,665.03 150,133,461.00 150,133,461.00
Project
Gree Ganzhou
244,948,297.47 244,948,297.47
Project
Gree Luoyang
192,443,288.72 192,443,288.72 1,046,021,393.89 1,046,021,393.89
Project
Zhuhai Green
Prevention and 115,158,283.10 115,158,283.10 23,108,375.54 23,108,375.54
Control Project
Others 542,346,775.84 542,346,775.84 759,945,972.86 759,945,972.86
244
Balance at the end of the period Beginning balance
Item Provision
Provision for
Book balance Book value Book balance for Book value
impairment
impairment
Total 6,481,290,747.13 54,413.75 6,481,236,333.38 4,016,082,730.07 4,016,082,730.07
245
(2) Current-period changes in important construction projects in progress
Amount Including:
Transfer to
transferred into Amount of
Increase in the scope of the Increased amount in investment real
Item Name Beginning balance fixed assets Balance at the end of the period capitalization of
combination in this period the current period estate in this
during the current interests for the
period
period current period
Gree Altairnano
2,341,162,945.24 49,560,244.17 123,540,014.78 2,267,183,174.63
Project
Gree HQ project 570,077,306.55 458,200,283.61 120,793,687.15 907,483,903.01
Gree Gaolan Port
62,939,878.48 598,819,552.56 661,759,431.04
Project
Gree Nanjing
736,808,586.56 579,446,466.90 53,871,154.40
Project 1,141,086,342.69 1,298,448,462.35
Gree Chengdu
260,766,823.26 379,308,256.58 220,990,069.12 419,085,010.72 5,778,289.15
Project
Intelligent
2,003,175.80 291,442,864.61 143,589.74 293,302,450.67
Equipment Project
Gree Energy
150,133,461.00 108,000,204.03 258,133,665.03
Project
Gree Ganzhou
244,948,297.47 244,948,297.47
Project
Gree Luoyang
764,232,702.64 192,443,288.72
Project 1,046,021,393.89 1,617,810,807.81
Zhuhai Green
Prevention and 23,108,375.54 92,049,907.56 115,158,283.10
Control Project
Others 759,945,972.86 841,714,189.20 3,856,543.64 542,346,775.84 8,880,935.92
1,055,456,842.58
Total 2,341,162,945.24 4,565,085,088.99 4,437,183,473.53 3,856,543.64 6,481,290,747.13 68,530,379.47
4,016,082,730.07
246
(3) Appropriation of provisions for impairment of construction in progress during the current period
Increase in
Beginning Decrease in the Balance at the end of the Reason for amount calculated and
Item the current
balance current year period withdrawn
year
Gree Altairnano
54,413.75 54,413.75
Project
Total 54,413.75 54,413.75
21. Usufruct assets
Item Housing and buildings Machinery equipment Total
I. Total of original carrying amount
1. Beginning balance 32,338,241.97 6,613,861.31 38,952,103.28
2. Increased amount in current
5,307,937.09 5,307,937.09
period
Including: renting 5,307,937.09 5,307,937.09
3. Decreased amount in
current period
4. Ending balance 37,646,179.06 6,613,861.31 44,260,040.37
II. Accumulated depreciation
1. Beginning balance
2. Increased amount in current
25,532,820.33 4,123,937.05 29,656,757.38
period
Including: appropriation 25,532,820.33 4,123,937.05 29,656,757.38
3. Amount decreased in the
current period
4. Ending balance 25,532,820.33 4,123,937.05 29,656,757.38
III. Provision for impairment
IV. Carrying amount
1. Book value at the end of the
12,113,358.73 2,489,924.26 14,603,282.99
period
2. Book value at the beginning
32,338,241.97 6,613,861.31 38,952,103.28
of the period
22. Intangible assets
Information of intangible assets
Item Land use rights Patent rights and others Total
I. Total of original carrying amount
1. Beginning balance 6,579,859,889.53 910,035,623.63 7,489,895,513.16
2. Increased amount in current
4,054,952,283.34 985,780,299.92 5,040,732,583.26
period
Including: purchase 1,136,180,177.63 13,024,545.35 1,149,204,722.98
Business combination
2,918,772,105.71 972,755,754.57 3,891,527,860.28
increase
247
Item Land use rights Patent rights and others Total
3. Amount decreased in the
22,373,120.00 22,373,120.00
current period
Including: writing off [Note 1] 22,373,120.00 22,373,120.00
4. Ending balance 10,634,812,172.87 1,873,442,803.55 12,508,254,976.42
II. Accumulated amortization
1. Beginning balance 811,406,456.89 76,470,097.45 887,876,554.34
2. Increased amount in current
395,290,707.77 628,182,641.55 1,023,473,349.32
period
Including: appropriation 161,076,502.06 48,999,518.21 210,076,020.27
Business combination
234,214,205.71 579,183,123.34 813,397,329.05
increase
3. Amount decreased in the
22,373,120.00 22,373,120.00
current period
Including: writing off 22,373,120.00 22,373,120.00
4. Ending balance 1,206,697,164.66 682,279,619.00 1,888,976,783.66
III. Provision for impairment
1. Beginning balance 723,730,196.18 723,730,196.18
2. Increased amount in current
period
3. Amount decreased in the
21,419,211.52 21,419,211.52
current period
Including: writing off 21,419,211.52 21,419,211.52
4. Ending balance 702,310,984.66 702,310,984.66
IV. Carrying amount
1. Book value at the end of the
9,428,115,008.21 488,852,199.89 9,916,967,208.10
period
2. Book value at the beginning
5,768,453,432.64 109,835,330.00 5,878,288,762.64
of the period
[Note 1] Write-off amounts of intangible assets - patented technology and others in the current period were the
used quota licensing rights;
[Note 2] As of December 31, 2021, the book value of intangible assets of which the Company has not obtained
the property ownership certificates was RMB 32,599.95.
[Note 3] There were no intangible assets formed through the Company's internal research and development
during the current period.
23. Goodwill
(1) Original carrying amount of goodwill
Decrease for
Name of invested entity or matter Increase in the Balance at the end of
Beginning balance the current
generating goodwill current period the period
period
248
Formed by
business Disposal
combination
Hefei Kinghome Electrics Co., Ltd 51,804,350.47 51,804,350.47
Nanjing Walsin Nonferrous Metal Co.,
274,115,040.11 274,115,040.11
Ltd.
Gree Altairnano New Energy Inc. 612,777,583.92 612,777,583.92
Total 325,919,390.58 612,777,583.92 938,696,974.50
[Note] On August 31, 2021, the Company obtained 336,197,406 shares of Zhuhai Yinlong New Energy Co., Ltd.
(hereinafter referred to as "Yinlong New Energy") through participating in the public auction of judicial sale,
accounting for 30.47% equity of Yinlong New Energy. At the same time, Ms. Dong Mingzhu, chairman of the
Company, entrusted 17.46% of the voting rights corresponding to 192,672,001 shares of Yinlong New Energy to the
Company for exercising. The Company controls the voting rights corresponding to 528,869,407 shares of Yinlong
New Energy in total, accounting for 47.93% of the total share capital of Yinlong New Energy. Yinlong New Energy
became the Company's holding subsidiary. On November 9, 2021, Yinlong New Energy was renamed Gree
Altairnano New Energy Inc. (hereinafter referred to as "Gree Altairnano New Energy").
As of the purchase date on October 31, 2021, the fair value of the recognizable net assets attributable to the
owner of the parent company was 1,215,497,529.64 yuan. The fair value of the corresponding recognizable net assets
was evaluated by China United Assets Appraisal Group Co., Ltd., and China United Appraisal Report Zi [2022] No.
1362 Appraisal Report was issued. The difference between the acquisition cost of 1,828,275,113.56 yuan and the fair
value of Gree Altairnano New Energy's recognizable net assets formed a goodwill of 612,777,583.92 yuan.
(2) Goodwill impairment provision of Nanjing Walsin Nonferrous Metal Co., Ltd.
Increase in the current Decrease for the
Name of invested entity or matter Beginning period current period Balance at the
generating goodwill balance end of the period
Appropriation Others Disposal Others
Nanjing Walsin Nonferrous Metal Co.,
124,016,686.56 107,051,151.70 231,067,838.26
Ltd.
Total 124,016,686.56 107,051,151.70 231,067,838.26
[Note] The Company acquired 94.30% of the equity of Nanjing Walsin Nonferrous Metal Co., Ltd., forming a
goodwill of RMB 274,115,040.11. According to the Appraisal Report on the Asset Group Recoverable Amount
Evaluation Project Related to Goodwill Involved by Zhuhai Gree Electrical Co., Ltd. for the Goodwill Impairment
Test Due to Merger and Acquisition of Nanjing Walsin Nonferrous Metal Co., Ltd. with the report number of China
Alliance Appraisal Report Zi [2022] No. 040218 issued by China Alliance Appraisal Co., Ltd., RMB 107,051,151.70
of impairment provision was accrued for the above-mentioned goodwill formed due to the acquisition in the current
period.
Goodwill asset group and impairment test
1) Information about the asset or asset group combination in which the goodwill is located
The Company tested the impairment of goodwill by combining the asset group related to goodwill that can
benefit from the synergistic effect of business combination. Because it was difficult to directly obtain the fair market
value of the asset group containing goodwill, the Company calculated the recoverable amount of the asset group by
249
using the method of predicting the present value of future cash flow. After comprehensively considering factors such
as production and operation activities management, monitoring methods, continuous use and disposal, the asset group
containing goodwill was finally determined. At the end of the period, the asset group where the goodwill was located
was consistent with the assets group determined when the goodwill was formed on the acquisition date, and its
composition has not changed. The information on the asset group including goodwill was as follows:
Unit: 10,000 Yuan
Serial No. Name of asset Book value of asset group
1 Fixed assets 11,798.77
2 Construction in progress 736.71
3 Intangible assets 10,099.60
4 Goodwill [Note] 15,917.11
Total 38,552.19
[Note] The goodwill shown in the above table included the part attributable to minority shareholders.
2) Important assumptions and key parameters of goodwill impairment test:
A. Assumption of orderly transactions: orderly transactions refer to transactions where the relevant assets or
liabilities have usual market activities during a period of time before the measurement date;
B. Assumption of going concern: assumption of going concern refers to the assumption that the asset group will
be used normally and continuously according to the purpose and use method of the benchmark date, and there will be
no unforeseen factors that will cause it to fail to continue operations, and the valuation method, parameters and basis
will be determined accordingly;
C. It is assumed that the Company has no major changes in the core management team, technical team, and
marketing team based on the existing management methods and levels, and no other human force majeure and
unforeseen factors have a major adverse impact on the Company;
D. Given the Company's operation and production are mainly to earn processing profits, the fluctuation of raw
material prices does not have a substantial impact on the Company's operating profits, therefore, it is assumed that the
raw material prices will remain unchanged in the coming years in the evaluation.
When conducting the asset impairment test, the Company estimated the expected return on investment of
property rights holders based on the analysis and calculation of selected and compared companies. After the
calculation, the pre-tax discount rate used in the impairment test was 12.30%.
3) Evaluation results of goodwill impairment test
Unit: 10,000 Yuan
Recoverable amount of asset Goodwill impairment
Company name Book value of asset group
group amount
Nanjing Walsin Nonferrous Metal Co.,
38,552.19 27,200.00 11,352.19
Ltd.
[Note] According to the Appraisal Report on the Appraisal Report on the Asset Group Recoverable Amount
Evaluation Project Related to Goodwill Involved by Zhuhai Gree Electrical Co., Ltd. for the Goodwill Impairment
Test Due to Merger and Acquisition of Nanjing Walsin Nonferrous Metal Co., Ltd. with the report number of China
Alliance Appraisal Report Zi [2022] No. 040218 issued by China Alliance Appraisal Co., Ltd., the asset group
250
including goodwill should be provided with a goodwill impairment loss of RMB 113,521,900.00, of which the
goodwill impairment loss attributable to shareholders of the parent company should be RMB 107,051,151.70.
(3) Goodwill impairment preparation of Gree Altairnano New Energy Inc.
From Gree Altairnano New Energy's evaluation base date of October 31, 2021 to the balance sheet date of
December 31, 2021, the production and operation of the company has not changed significantly, the goodwill
impairment preparation was not accrued.
24. Deferred income tax assets/deferred income tax liabilities
(1) Deferred income tax assets not offset
Balance at the end of the period Beginning balance
Item
Deductible temporary Deferred income tax Deductible temporary Deferred income tax
differences assets differences assets
Assets depreciation
5,526,051,132.93 934,860,835.60 1,945,939,722.60 331,079,465.72
reserves
Deductible loss 6,783,704,724.84 1,426,651,977.24 929,716,127.83 200,650,142.61
Accrued expenses 70,642,488,124.58 10,603,767,691.88 70,734,519,794.58 10,612,752,964.88
Employee pay
1,342,012,620.97 207,941,829.63 1,138,661,981.04 177,276,992.60
payable
Assets amortization 282,882,015.47 43,093,274.62 277,892,654.00 42,292,876.53
Others 2,866,665,758.43 445,534,163.71 1,051,311,939.85 186,239,758.68
Total 87,443,804,377.22 13,661,849,772.68 76,078,042,219.90 11,550,292,201.02
(2) Deferred income tax liabilities not offset
Balance at the end of the period Beginning balance
Item
Taxable temporary Deferred income Taxable temporary Deferred income tax
differences tax liabilities differences liabilities
Fair value changes in
282,767,966.53 47,017,208.48 894,532,218.27 172,009,915.29
derivative financial assets
Accrued interest 3,671,369,000.39 696,523,997.54 2,595,212,306.29 481,753,397.01
Assets amortization 1,395,006,607.26 228,029,140.30 1,150,514,923.85 188,338,452.95
Changes in fair value of
other equity instrument 5,788,793,612.15 868,319,041.82 3,360,535,396.59 504,080,309.49
investments
Appraisal and appreciation
for consolidated assets of
2,005,971,524.03 320,359,752.22 274,949,344.47 63,085,772.95
enterprises not under the
same control
Others 535,300,948.02 133,663,373.43 8,513,732.04 1,843,255.15
Total 13,679,209,658.38 2,293,912,513.79 8,284,257,921.51 1,411,111,102.84
(3) Details of deferred income tax assets which were not recognized
Item Balance at the end of the period Beginning balance
251
Item Balance at the end of the period Beginning balance
Deductible temporary
2,649,057,873.48 741,969,846.84
differences
Deductible loss 1,999,613,109.29 202,245,092.25
Total 4,648,670,982.77 944,214,939.09
(4) The deductible losses of deferred income tax assets not recognized will become due in the following years
Year Amount at the end of the period Amount at the beginning of the period
2022 14,111,337.16
2023 58,759,679.60 30,888,536.25
2024 37,615,022.30 196,543.53
2025 37,836,203.73 8,502,385.16
2026 73,328,698.01
Open-ended 1,777,962,168.49 162,657,627.31
Total 1,999,613,109.29 202,245,092.25
25. Other non-current assets
Balance at the end of the period Beginning balance
Item Provision Provision
Book balance for Book value Book balance for Book value
impairment impairment
Advance payment for
319,558,426.19 319,558,426.19 642,531,256.64 642,531,256.64
equipment
Prepaid project funds and
357,562,564.75 357,562,564.75 111,813,697.80 111,813,697.80
deposit
Prepaid land-transferring
39,127,688.96 39,127,688.96 33,773,076.96 33,773,076.96
fees and others
Total 716,248,679.90 716,248,679.90 788,118,031.40 788,118,031.40
26. Short-term borrowings
(1) Classification of short-term borrowings
Item Balance at the end of the period Beginning balance
Pledge loans 12,624,147,777.77 10,050,000,000.00
Mortgaged borrowings 2,252,700,000.00 92,999,987.80
Guaranteed loan 58,000,000.00
Borrowing on credit 12,586,183,086.85 9,991,044,455.36
Subtotal 27,463,030,864.62 20,192,044,443.16
Accrued interest 154,889,683.49 112,340,299.18
Total 27,617,920,548.11 20,304,384,742.34
252
(2) Short-term borrowings that have been overdue but not yet repaid
No.
27. Loans from other banks
Item Balance at the end of the period Beginning balance
Credit lending 300,000,000.00 300,000,000.00
Accrued interest 21,500.00 20,250.00
Total 300,021,500.00 300,020,250.00
28. Funds from financial assets sold for repurchase
Item Balance at the end of the period Beginning balance
Bonds (pledge-style
746,564,041.09 475,033,835.62
repurchase)
Total 746,564,041.09 475,033,835.62
29. Deposits from customers and interbank
Item Balance at the end of the period Beginning balance
Current deposits 34,023,561.14 40,660,078.51
Time deposits 142,684,338.50 153,847,631.94
Draft deposits 60,763,500.00
Subtotal 176,707,899.64 255,271,210.45
Accrued interest 5,974,006.10 5,735,497.79
Total 182,681,905.74 261,006,708.24
30. Notes payable
Type Balance at the end of the period Beginning balance
Banker's acceptance bill 40,737,984,514.42 21,416,071,950.32
Trade acceptance draft 6,000,000.00 11,000,000.00
Total 40,743,984,514.42 21,427,071,950.32
31. Accounts payable
(1) Listing of accounts payable
Item Balance at the end of the period Beginning balance
Payment for goods and
33,845,824,271.75 30,675,053,443.18
service charges
Others 2,029,266,639.30 929,605,723.70
Total 35,875,090,911.05 31,604,659,166.88
253
(2) Important payables with account age exceeding 1 year
No.
32. Contract liabilities
Item Balance at the end of the period Beginning balance
Loans 15,505,499,178.75 11,678,180,424.65
Total 15,505,499,178.75 11,678,180,424.65
[Note] Contract liabilities are mainly the payment for goods of dealers received in advance.
33. Employee pay payable
(1) Presentation of employees' wages and salaries payable
Increase in the Decrease for the Balance at the
Item Beginning balance
current period current period end of the period
I. Short-term wages and salaries 3,362,509,189.13 9,694,087,979.57 9,595,005,228.57 3,461,591,940.13
II. Separation benefits - defined
2,846,279.56 615,473,128.68 613,280,946.64 5,038,461.60
contribution plan
Total 3,365,355,468.69 10,309,561,108.25 10,208,286,175.21 3,466,630,401.73
(2) Listing of short-term wages and salaries
Beginning Increase in the Decrease for the Balance at the
Item
balance current period current period end of the period
1. Wages, bonuses, subsidies and allowances 2,454,866,944.76 8,183,052,058.41 8,153,762,416.21 2,484,156,586.96
2. Employee welfares 849,219,795.07 849,219,795.07
3. Social insurance premiums 760,334.68 229,759,614.44 229,687,133.56 832,815.56
Including: medical insurance premiums 725,202.12 201,971,778.90 201,893,360.85 803,620.17
Work-related injury insurance
14,221.87 13,183,884.99 13,169,857.67 28,249.19
premiums
Maternity insurance premiums 20,910.69 14,603,950.55 14,623,915.04 946.20
4. Housing accumulation funds 1,503,063.69 190,249,506.59 189,153,654.03 2,598,916.25
5. Labor union expenditures and employee
905,378,846.00 241,807,005.06 173,182,229.70 974,003,621.36
education funds
Total 3,362,509,189.13 9,694,087,979.57 9,595,005,228.57 3,461,591,940.13
(3) Presentation of separation benefits - defined contribution plan
Increase in the current Decrease for the Balance at the end of the
Item Beginning balance
period current period period
1. Basic endowment
2,515,822.87 593,679,622.25 592,311,212.16 3,884,232.96
insurance premiums
2. Unemployment
330,456.69 21,793,506.43 20,969,734.48 1,154,228.64
insurance premium
Total 2,846,279.56 615,473,128.68 613,280,946.64 5,038,461.60
254
34. Taxes and dues payable
Item Balance at the end of the period Beginning balance
Added-value tax 1,015,503,640.35 1,188,975,420.12
Business income tax 961,029,463.82 785,653,809.28
Others 253,938,087.32 326,726,353.62
Total 2,230,471,191.49 2,301,355,583.02
35. Other payables
Item Balance at the end of the period Beginning balance
Dividends payable 2,367,112.94 6,986,645.96
Other payables [Note 1] 6,760,752,824.20 2,372,409,071.48
Total 6,763,119,937.14 2,379,395,717.44
[Note 1] Other payables in the table above refer to other payables after deduction of interest payable and
dividends payable;
[Note 2] The Company has no interest payable at the end and the beginning of the period.
(1) Other payables are presented by amount nature
Item Balance at the end of the period Beginning balance
Intercourse funds 3,018,271,527.82 1,527,670,503.18
Margin and deposit 1,010,801,182.18 844,738,568.30
Enterprise borrowing and interest 2,731,680,114.20
Total 6,760,752,824.20 2,372,409,071.48
(2) Other important payables with account age exceeding 1 year
Item Balance at the end of the period Cause of failing to repay or carry over
Unit 1 1,313,486,008.35 Unsatisfied repayment conditions
Unit 2 455,928,100.00 Unsatisfied repayment conditions
Total 1,769,414,108.35
36. Non-current liabilities due within one year
Item Balance at the end of the period Beginning balance
Long-term borrowing due within one year 1,226,863,474.75
Long-term payable to be matured within one
16,958,747.82
year
Lease liability due within 1 year 11,471,812.27 22,927,889.42
Total 1,255,294,034.84 22,927,889.42
37. Other current liabilities
255
Item Balance at the end of the period Beginning balance
Repair cost 1,913,804,227.53 1,893,012,124.81
Sale's returned profit 52,669,278,982.00 55,808,250,764.80
Obligation to pay commercial papers which is
852,128,009.63 4,588,589,780.94
not derecognized
Output tax to be wrote-off 1,925,767,413.76 1,469,269,506.13
Short-term bonds payable [Note] 4,048,840,948.73
Others 1,004,287,682.55 623,132,106.86
Total 62,414,107,264.20 64,382,254,283.54
256
[Note] The following is the change in short-term bonds payable of the Company in this period:
Amortization
of the
Abbreviation of Issuing Bond Beginning Accrued interest Balance at the
Face value Amount issued Current issuance premiums Current payment
bonds date duration balance at nominal value end of the period
and
discounts
21 Gree Electric
January
Appliances 3,000,000,000.00 35 days 3,000,000,000.00 3,000,000,000.00 6,817,808.22 3,006,817,808.22
21, 2021
SCP001
21 Gree Electric
February
Appliances 3,000,000,000.00 43 days 3,000,000,000.00 3,000,000,000.00 8,482,191.78 3,008,482,191.78
24, 2021
SCP002
21 Gree Electric
March 19,
Appliances 2,000,000,000.00 96 days 2,000,000,000.00 2,000,000,000.00 14,465,753.42 2,014,465,753.42
2021
SCP003
21 Gree Electric
March 29,
Appliances 4,000,000,000.00 98 days 4,000,000,000.00 4,000,000,000.00 28,997,260.27 4,028,997,260.27
2021
SCP004
21 Gree Electric
April 16,
Appliances 3,000,000,000.00 44 days 3,000,000,000.00 3,000,000,000.00 8,534,794.52 3,008,534,794.52
2021
SCP005
21 Gree Electric
June 17,
Appliances 3,000,000,000.00 48 days 3,000,000,000.00 3,000,000,000.00 9,271,232.88 3,009,271,232.88
2021
SCP006
21 Gree Electric
June 17, 169
Appliances 1,000,000,000.00 1,000,000,000.00 1,000,000,000.00 12,038,356.16 1,012,038,356.16
2021 days
SCP007
21 Gree Electric
June 29, 162
Appliances 2,000,000,000.00 2,000,000,000.00 2,000,000,000.00 23,079,452.05 2,023,079,452.05
2021 days
SCP008
21 Gree Electric
July 9, 177
Appliances 4,000,000,000.00 4,000,000,000.00 4,000,000,000.00 49,008,219.18 -167,270.45 4,048,840,948.73
2021 days
SCP009
Total 25,000,000,000.00 25,000,000,000.00 25,000,000,000.00 160,695,068.48 -167,270.45 21,111,686,849.30 4,048,840,948.73
257
38. Long-term borrowings
Item Balance at the end of the period Beginning balance
Pledge loans 133,082,315.96 142,481,242.20
Mortgaged borrowings 2,303,590,315.07 1,561,190,447.00
Borrowing on credit 7,726,847,919.32 152,752,584.38
Subtotal 10,163,520,550.35 1,856,424,273.58
Accrued interest 24,207,182.70 4,289,542.51
Less: Long-term borrowing due within one
1,226,863,474.75
year
Total 8,960,864,258.30 1,860,713,816.09
39. Lease liabilities
Item Balance at the end of the period Beginning balance
Lease liabilities 14,785,264.79 32,338,241.97
Less: Lease liability due within 1 year 11,471,812.27 22,927,889.42
Total 3,313,452.52 9,410,352.55
40. Long-term payables
Item Balance at the end of the period Beginning balance
Financial liabilities formed after repurchase 463,153,339.74
Less: Long-term payables due within 1
16,958,747.82
year
Total 446,194,591.92
41. Long-term payroll payable
(1) Table of long-term payroll payable
Item Balance at the end of the period Beginning balance
Separation benefits - net liabilities of
164,408,471.00 149,859,788.00
defined benefit plan
Total 164,408,471.00 149,859,788.00
(2) Changes in the defined benefit plan
1) Present value of obligations under the defined benefit plan:
Amount for the current Amount for the previous
Item
period period
I. Beginning balance 149,859,788.00 141,021,228.00
II. Defined benefit cost recorded in the current profits and losses 7,930,751.00 7,441,863.00
258
Amount for the current Amount for the previous
Item
period period
1. Service cost of the current period 2,611,662.00 2,312,128.00
2. Net interest 5,141,391.00 4,837,059.00
3. Impact on new personnel 177,698.00 292,676.00
III. Cost of the defined benefit plan included in other comprehensive income 12,391,783.00 6,851,653.00
Including: actuarial gains (losses are listed with "-") 12,391,783.00 6,851,653.00
IV. Other changes -5,773,851.00 -5,454,956.00
Including: paid benefits -5,773,851.00 -5,454,956.00
V. Balance at the end of the period 164,408,471.00 149,859,788.00
2) Net liabilities (net assets) of the defined benefit plan:
Amount for the current Amount for the previous
Item
period period
I. Beginning balance 149,859,788.00 141,021,228.00
II. Defined benefit cost recorded in the current profits and losses 7,930,751.00 7,441,863.00
III. Cost of the defined benefit plan included in other comprehensive income 12,391,783.00 6,851,653.00
IV. Other changes -5,773,851.00 -5,454,956.00
V. Balance at the end of the period 164,408,471.00 149,859,788.00
(3) Contents and associated risks of the defined benefit plan, and its influences on the Company’s future cash
flow, time and uncertainty:
1) Contents and associated risks of the defined benefit plan, and its influences on the Company’s future
cash flow, time and uncertainty:
The Company’s defined benefit plan is a supplementary post-retirement pension plan for some retirees, early
retirees and serving officers after normal retirement. This defined benefit plan didn’t involve big amount, so it didn’t
lead to significant influence on the future cash flow the Company.
2) Significant actuarial assumptions and sensitivity analysis results of the defined benefit plan
According to requirements of the Accounting Standards for Business Enterprises No. 9 - Employee
Compensation, the discount rate adopted by the Company at the time of discount is recognized by the market yields
of high-quality corporate bonds in the treasury bonds or active market that match the obligatory term and currency of
the defined benefit plan on the balance sheet date; the annual growth rates and annual dismissal rates of all benefits
are based on the actual measurement data of the Company; the death rate is recognized by referring to the experience
life table for insurance business of China Life Insurance (Group) Company.
(4) Quantitative sensitivity analysis of all the used major assumptions by the end of the Report Period:
Influence on the amount at the end of
Sensitivity analysis of discount rate
the period
259
Influence on the amount at the end of
Sensitivity analysis of discount rate
the period
Influence on the present obligation value of defined welfare benefit by increase of one
-21,612,508.00
percentage point
Influence on the present obligation value of defined welfare benefit by decrease of one
27,344,235.00
percentage point
Influence on the service cost by increase of one percentage point -686,100.00
Influence on the service cost by decrease of one percentage point 730,522.00
42. Deferred Income
(1) Classification of deferred income
Beginning Increase in the Increase in the Decrease for the Balance at the end
Item
balance combination scope current period current period of the period
Government subsidies 437,033,702.46 1,179,257,549.38 1,206,207,782.75 126,411,065.89 2,696,087,968.70
Others 6,804,690.12 238,761.04 6,565,929.08
Total 437,033,702.46 1,186,062,239.50 1,206,207,782.75 126,649,826.93 2,702,653,897.78
(2) Projects involved in government subsidies
Beginning Increase in the Increase in the Decrease for the Balance at the end
Item
balance combination scope current period current period of the period
I. Government subsidies
181,089,774.04 67,387,011.32 37,124,718.37 211,352,066.99
pertinent to incomes
Including: environmental
2,656,866.22 24,833,400.00 2,196,632.83 25,293,633.39
protection upgrade project
Scientific research
project of refrigerating 115,014,244.49 35,491,861.32 25,268,671.05 125,237,434.76
field
Others 63,418,663.33 7,061,750.00 9,659,414.49 60,820,998.84
II. Government subsidies
255,943,928.42 1,179,257,549.38 1,138,820,771.43 89,286,347.52 2,484,735,901.71
pertinent to assets
Including: environmental
13,707,325.37 14,759,808.25 2,038,753.26 26,428,380.36
protection upgrade project
Scientific research
project of refrigerating 210,623,822.17 1,075,495,434.86 56,482,290.10 1,229,636,966.93
field
Energy vehicle
1,179,257,549.38 210,528.32 10,494,868.66 1,168,973,209.04
project
Others 31,612,780.88 48,355,000.00 20,270,435.50 59,697,345.38
Total 437,033,702.46 1,179,257,549.38 1,206,207,782.75 126,411,065.89 2,696,087,968.70
43. Capital stock
Increase in the Decrease for the Balance at the end of the
Item Beginning balance
current period current period period
Total number of stocks 6,015,730,878.00 101,261,838.00 5,914,469,040.00
Total 6,015,730,878.00 101,261,838.00 5,914,469,040.00
[Note] For the reasons for changes in the share capital in this period, please refer to Note V. 45 "Treasury stock" for details.
260
44. Capital reserves
Increase in the Decrease for the current Balance at the end of
Item Beginning balance
current period period the period
Capital stock premium 26,979,063.83 26,979,063.83
Other capital reserves 94,871,216.85 31,002,910.71 125,874,127.56
Total 121,850,280.68 31,002,910.71 26,979,063.83 125,874,127.56
[Note] For the reasons for changes in the capital reserve in this period, please refer to Note V. 45 "Treasury stock" for details.
45. Treasury stock
Decrease for the current Balance at the end of the
Item Beginning balance Increase in the current period
period period
Repurchase
5,182,273,853.90 22,963,072,582.09 8,565,700,202.56 19,579,646,233.43
share
Total 5,182,273,853.90 22,963,072,582.09 8,565,700,202.56 19,579,646,233.43
[Note 1] As of December 31, 2021, the Company has cumulatively repurchased 431,202,956 shares in this
period, of which 14,181,091 shares were repurchased in the first period, 101,261,838 were repurchased in the second
period, and 315,760,027 shares were repurchased in the third period, which was completed on September 9, 2021.The
three-period repurchase funds totaled 21,819,537,788.45 yuan.The repurchased treasury stock accounts for 7.17% of
the Company's total share capital at that time, all of which were stored in the Company's special securities account.
During the storage period, the right to voting, profit distribution, provident fund converted into share capital,
allotment of shares, pledge and other related rights are not enjoyed during the storage period.
[Note 2] The repurchased 101,261,838 shares in the second period were canceled on November 9, 2021, with an
amount of 6,000,083,145.56 yuan, reducing the Company's share capital of 101,261,838 yuan, the corresponding
capital stock premium by of 26,979,063.83 yuan, the statutory surplus reserve of 2,530,583,291.14 yuan,
discretionary surplus reserve of 969,088,265.45 yuan, and undistributed profit of 2,372,170,687.14 yuan;
[Note 3] On December 13, 2021, transferred 46,334,473 shares from the Company's special securities account
for repurchase by the non-trading transfer method to Gree Electric Appliances, Inc. of Zhuhai - special account for
the first phase of the employee shareholding plan of 2,565,617,057.00 yuan, accounting for 0.78% of the Company's
total share capital at that time, which reduced the undistributed profit of 1,422,082,263.36 yuan. At the same time, the
recognition of stock repurchase obligations in this period increased the treasury stock of 1,143,534,793.64 yuan and
the apportion of stock ownership incentive - employee shareholding holding plan fees increased other capital reserves
of 31,002,910.71 yuan.
261
46. Other comprehensive income
Amount for the current period
Less: Amount
Less: Amount
recognized into
included into other
other
comprehensive Amount
Beginning Amount incurred comprehensive Amount Balance at the end
Item income in the attributable to
balance before income tax income in Less: Income tax attributable to the of the period
previous period minority
in the current previous period expenses parent company
and transferred to shareholders
period and transferred after tax
retained earnings after tax
to the current
in the current
profits and
period
losses
I. Other comprehensive income
which cannot be reclassified into 7,384,141,428.99 4,341,598,647.87 114,949,817.60 364,238,732.33 3,862,410,097.94 11,246,551,526.93
profits and losses
Changes arising from
remeasurement of the defined benefit -51,014,494.00 -12,391,783.00 -12,391,783.00 -63,406,277.00
plan
Other comprehensive income which
cannot be transferred to profit or loss 4,999,568,613.35 1,849,833,156.32 1,849,833,156.32 6,849,401,769.67
under the equity method
Changes in fair value of other equity
2,435,587,309.64 2,504,157,274.55 114,949,817.60 364,238,732.33 202,4968,724.62 4,460,556,034.26
instrument investments
II. Other comprehensive income
which will be reclassified into profits 11,918,766.48 -30,049,881.26 22,298,300.00 1,954,547.06 -54,465,938.14 163,209.82 -42,547,171.66
and losses in the future
Other comprehensive income that
can be transferred to profit or loss -685,328.00 -208,819.44 -476,508.56 -208,819.44
under the equity method
Changes in fair value of other debt
-57,643,029.12 -1,251,507.19 725,128.31 -2,346,134.55 369,499.05 -59,989,163.67
investments
Cash flow hedge reserve 18,953,555.00 30,494,425.00 22,298,300.00 1,229,418.75 6,966,706.25 25,920,261.25
Difference arising from translation
of financial statements in foreign 50,608,240.60 -58,607,471.07 -58,877,690.40 270,219.33 -8,269,449.80
currency
262
Amount for the current period
Less: Amount
Less: Amount
recognized into
included into other
other
comprehensive Amount
Beginning Amount incurred comprehensive Amount Balance at the end
Item income in the attributable to
balance before income tax income in Less: Income tax attributable to the of the period
previous period minority
in the current previous period expenses parent company
and transferred to shareholders
period and transferred after tax
retained earnings after tax
to the current
in the current
profits and
period
losses
Total other comprehensive income 7,396,060,195.47 4,311,548,766.61 22,298,300.00 114,949,817.60 366,193,279.39 3,807,944,159.80 163,209.82 11,204,004,355.27
263
47. Special reserve
Balance at the
Beginning Increase within the Increase in the current Decrease for the current
Item end of the
balance combination scope period period
period
Safe production
21,259,298.20 2,404,215.46 1,259,667.40 22,403,846.26
expense
Total 21,259,298.20 2,404,215.46 1,259,667.40 22,403,846.26
48. Surplus reserve
Increase in the Decrease for the current Balance at the
Item Beginning balance
current period period end of the period
Statutory surplus reserve 2,530,583,291.14 1,983,727,107.74 2,530,583,291.14 1,983,727,107.74
Discretionary surplus
969,088,265.45 969,088,265.45
reserve
Total 3,499,671,556.59 1,983,727,107.74 3,499,671,556.59 1,983,727,107.74
[Note 1] According to the regulations, the Company accrues the legal reserve at 10% of the net profits of the parent company in this
period;
[Note 2] For the reasons for decrease in the surplus public accumulation in this period, please refer to Note V. 45 "Treasury stock"
for details.
49. General risk provisions
Increase in the Decrease for the current Balance at the
Item Beginning balance
current period period end of the period
General risk provisions 497,575,772.26 8,023,584.04 505,599,356.30
Total 497,575,772.26 8,023,584.04 505,599,356.30
[Note] The subsidiaries of the financial enterprise under the Company withdraws general risk preparation with their respective
annual net profits or risk assets at the end of the year according to the "Administrative Measures for the Accrual of Reserve Funds of the
Financial Enterprises" and other relevant provisions.
50. Undistributed profit
Item Amount for the current period Amount for the previous period
Undistributed profit at the beginning of the period 102,841,596,377.66 93,794,643,539.49
Undistributed profit at the beginning of the period after
102,841,596,377.66 93,794,643,539.49
adjustment
Add: Net profit attributable to owners of the parent company
23,063,732,372.62 22,175,108,137.32
for the current period
Less: Withdrawal of statutory surplus reserves 1,983,727,107.74
Appropriation of general risk provisions 8,023,584.04 7,719,945.51
Ordinary stock dividends payable [Notes 1] 16,752,531,495.00 13,140,423,269.60
Influence of share-based payment and share cancellation
3,794,252,950.50
[Note 2]
Add: Other comprehensive income carried forward to retained
108,429,387.17 19,987,915.96
earnings
Undistributed profit at the end of the period 103,475,223,000.17 102,841,596,377.66
264
[Note 1] According to the resolutions of the general meeting of shareholders on June 30, 2021, the Company
distributed cash dividends to all shareholders at a rate of RMB 30.00 (including tax) per 10 shares. Based on the
deduction of repurchased shares (the Company has cumulatively repurchased a total of 431,553,713 shares) in the
special account for repurchase from the Company's total share capitals of 6,015,730,878 shares, RMB
16,752,531,495.00 of cash dividends were actually distributed.
[Note 2] For the influence of the Company's share-based payment and share cancellation in this period on the
undistributed profits, please refer to Note V. 45 "Treasury stock" for details.
51. Operating revenues and operating costs
Amount for the current period Amount for the previous period
Item
Revenue Cost Revenue Cost
Main business 144,840,537,601.90 101,021,238,221.75 130,427,766,473.54 87,921,191,886.69
Other business 43,028,337,290.81 41,230,400,368.12 37,771,437,930.99 36,307,841,794.23
Total 187,868,874,892.71 142,251,638,589.87 168,199,204,404.53 124,229,033,680.92
Information related to the main business incomes:
Amount for the current period Amount for the previous period
Item
Revenue Cost Revenue Cost
Classified by
industry
Manufacturing
144,840,537,601.90 101,021,238,221.75 130,427,766,473.54 87,921,191,886.69
industry
Total 144,840,537,601.90 101,021,238,221.75 130,427,766,473.54 87,921,191,886.69
Classified by
product type
Including: air
131,712,664,218.81 90,576,252,210.44 115,576,822,921.57 75,391,437,042.70
conditioner
Home
4,881,607,693.72 3,262,705,849.18 4,521,756,518.81 3,083,266,840.17
appliances
Industrial
3,194,552,084.04 2,604,593,659.63 2,304,816,992.20 2,038,896,719.43
products
Intelligent
857,741,120.95 606,116,653.12 600,778,785.76 425,337,854.62
equipment
Green energy 2,907,445,769.91 2,729,740,202.70 1,782,282,335.29 1,488,663,827.16
Others 1,286,526,714.47 1,241,829,646.68 5,641,308,919.91 5,493,589,602.61
Total 144,840,537,601.90 101,021,238,221.75 130,427,766,473.54 87,921,191,886.69
Classified by region
Including: sale in
122,305,111,567.10 80,703,210,957.38 110,407,002,220.87 70,329,850,923.05
domestic market
Export sales 22,535,426,034.80 20,318,027,264.37 20,020,764,252.67 17,591,340,963.64
Total 144,840,537,601.90 101,021,238,221.75 130,427,766,473.54 87,921,191,886.69
52. Interest incomes, interest expenditures
265
Item Amount for the current period Amount for the previous period
Interest revenue 1,785,060,001.28 2,295,972,686.55
Including: interest revenue from deposits in other
967,523,971.58 1,395,939,587.36
banks and central banks
Interest revenue from disbursement of
642,933,336.95 762,577,244.28
loans and advances
Others 174,602,692.75 137,455,854.91
Interest expenses 523,238,956.03 304,448,121.92
Including: expenses from transactions with
492,270,450.54 290,237,534.52
financial institutions
Others 30,968,505.49 14,210,587.40
Net interest revenue 1,261,821,045.25 1,991,524,564.63
53. Taxes and surcharges
Item Amount for the current period Amount for the previous period
Urban maintenance & construction tax 192,741,080.66 181,452,425.09
Educational surcharges 140,987,749.25 136,118,810.46
House property tax 182,944,167.04 141,422,302.62
Land use tax 114,448,407.21 98,229,736.11
Commodity circulation tax and industrial product
93,622,542.23 82,095,878.99
tax of Brazil
Funds from processing of waste electric appliances 189,225,358.89 203,651,307.67
Others 162,695,156.50 121,630,232.87
Total 1,076,664,461.78 964,600,693.81
54. Sales expense
Item Amount for the current period Amount for the previous period
Sales expense 11,581,735,617.31 13,043,241,798.27
Total 11,581,735,617.31 13,043,241,798.27
[Note] In 2021, the selling expenses mainly included the installation and maintenance cost, transportation and
warehousing fee and loading and unloading fee, and promotion fee, accounting for more than 80% of the total selling
expenses.
55. Administrative expense
Item Amount for the current period Amount for the previous period
Administrative expense 4,051,241,003.05 3,603,782,803.64
Total 4,051,241,003.05 3,603,782,803.64
[Note] In 2021, the overhead expenses included the employees' wages and salaries, material consumption,
depreciation and amortization, accounting for more than 80% of the total overhead expenses.
266
56. Research and development expenses
Item Amount for the current period Amount for the previous period
Research and development expenses 6,296,715,941.03 6,052,563,108.10
Total 6,296,715,941.03 6,052,563,108.10
[Note] In 2021, the R&D expenses included the employees' labor cost and direct investment cost, accounting for
more than 80% of the total R&D expenses.
57. Financial expense
Item Amount for the current period Amount for the previous period
Interest expense [Note 1] 1,752,112,003.72 1,088,369,394.87
Less: Interest income [Note 2] 4,242,449,764.06 3,708,312,903.06
Exchange gain and loss 99,198,910.38 598,702,350.00
Bank charges 125,651,596.78 76,682,416.86
Interest charges for defined welfare benefit
5,141,391.00 4,837,059.00
obligations
Others 143,865.00 2,217,022.26
Total -2,260,201,997.18 -1,937,504,660.07
[Note 1] The above interest expenses included the long-term and short-term borrowing interest expenses and the
note discount interest expense immediately recognized upon the derecognition of notes;
[Note 2] Both the above interest income and the "Interest income, interest expenditure" in Note V. 52 were
capital gains.
58. Other incomes
(1) Classification of other incomes
Amount recorded in non-recurring
Amount for the current
Sources of other incomes Amount for the previous period profit and loss of the current
period
period
Government subsidies 818,485,990.31 1,146,204,685.40 790,604,956.72
Handling charge refund of
13,691,263.12 17,915,425.64 13,691,263.12
individual income tax and others
Total 832,177,253.43 1,164,120,111.04 804,296,219.84
(2) Government subsidies recorded in the profits and losses of current period
Amount for the current
Subsidy items Amount for the previous period Asset-related/income-related
period
Financial rewards 268,054,381.05 450,465,248.34 Pertinent to assets and incomes
Capital allowance for
157,603,446.43 137,091,175.26 Pertinent to assets and incomes
development projects
Technological innovation
99,160,068.06 149,409,503.16 Pertinent to assets and incomes
subsidies income
Human resources subsidy 117,247,050.67 230,407,062.27 Pertinent to incomes
267
Amount for the current
Subsidy items Amount for the previous period Asset-related/income-related
period
Others 176,421,044.10 178,831,696.37 Pertinent to assets and incomes
Total 818,485,990.31 1,146,204,685.40
59. Income from investment
Item Amount for the current period Amount for the previous period
Long-term equity investment income calculated by the equity
51,594,928.82 35,314,343.21
method
Investment income from derivative financial instruments 260,896,892.48 325,129,297.18
Investment income recognized from trading financial assets 35,466,278.80 213,050,762.46
Others 174,105,122.48 139,515,668.82
Total 522,063,222.58 713,010,071.67
60. Incomes from changes in fair value
Sources of incomes from changes in fair value Amount for the current period Amount for the previous period
Trading financial assets and instruments -2,542,451.16 -19,994,874.52
Derivative financial instruments -70,951,646.94 245,563,316.57
Others 15,363,553.00 -25,414,970.00
Total -58,130,545.10 200,153,472.05
61. Credit impairment losses
Item Amount for the current period Amount for the previous period
Loss on bad debt -179,275,078.48 -41,209,742.51
Impairment losses of loans and advances 28,294,208.74 234,034,435.04
Total -150,980,869.74 192,824,692.53
62. Asset impairment loss
Item Amount for the current period Amount for the previous period
Impairment losses of contract assets -28,587,466.72 -5,036,930.75
Inventory falling price loss -470,468,223.45 -337,216,704.36
Impairment losses of business reputation -107,051,151.70 -124,016,686.56
Impairment losses on the construction in progress -54,413.75
Total -606,161,255.62 -466,270,321.67
63. Income from disposal of assets
Source of income from disposal of assets Amount for the current period Amount for the previous period
268
Source of income from disposal of assets Amount for the current period Amount for the previous period
Profit from disposal of non-current assets (losses indicated with
6,212,295.19 2,945,975.01
"-")
Total 6,212,295.19 2,945,975.01
64. Non-operating revenues
Amount recorded in non-recurring
Amount for the Amount for the previous
Item profit and loss of the current
current period period
period
Government subsidies not pertinent to
83,322,120.02 223,314,876.04 83,322,120.02
operation
Net profit from destruction scrap of
737,924.23 414,312.82 737,924.23
non-current assets
Including: Gains from disposal of fixed
737,924.23 414,312.82 737,924.23
assets
Others 70,261,732.62 63,431,533.11 70,261,732.62
Total 154,321,776.87 287,160,721.97 154,321,776.87
Government subsidies recorded in current profits or losses:
Amount for the Amount for the Amount recorded in non-recurring profit
Subsidy items
current period previous period and loss of the current period
Financial rewards 83,289,185.02 223,268,715.18 83,289,185.02
Others 32,935.00 46,160.86 32,935.00
Total 83,322,120.02 223,314,876.04 83,322,120.02
65. Non-operating expenses
Amount for the Amount for the Amount recorded in non-recurring profit
Item
current period previous period and loss of the current period
Net loss from destruction scrap of
16,698,680.87 8,334,512.45 16,698,680.87
non-current assets
Including: net losses from destruction
16,698,680.87 8,334,512.45 16,698,680.87
scrap of fixed assets
Others 11,750,889.43 13,406,618.43 11,750,889.43
Total 28,449,570.30 21,741,130.88 28,449,570.30
66. Income tax expenses
(1) Table of income tax expenses
Item Amount for the current period Amount for the previous period
Income tax expenses of the current period 3,952,404,363.46 2,745,896,993.46
Deferred income tax expenses 18,939,502.22 1,283,798,240.06
Total 3,971,343,865.68 4,029,695,233.52
(2) Adjustment process of accounting profits and income tax expenses
269
Item Amount for the current period
Total profits 26,803,237,498.57
Income tax expenses calculated by the statutory/applicable tax rate 4,020,485,624.79
Impact by different tax rates applicable to subsidiaries 194,827,963.39
Impact by non-deductible costs, expenses and losses 56,839,496.07
Impact by deductible temporary differences or deductible losses of deferred income tax
234,302,496.48
assets not recognized in the current period
Others -535,111,715.05
Income tax expenses 3,971,343,865.68
67. Items of cash flow statement
(1) Other cash received relating to operating activities
Item Amount for the current period Amount for the previous period
Government subsidies 1,975,966,016.65 1,521,419,832.12
Interest revenue 188,322,311.64 83,834,745.40
Net decrease in bill pledge deposits and
377,056,472.79 1,833,792,536.95
guarantee deposits
Margin, deposit and others 1,397,356,516.94 1,259,280,898.85
Total 3,938,701,318.02 4,698,328,013.32
(2) Other cash payment related to operating activities
Amount for the previous
Item Amount for the current period
period
Cash repayments for selling expenses 9,807,177,220.69 13,357,256,381.18
Cash repayments for overhead expenses and R&D expenses 1,355,681,755.66 1,591,137,889.61
Return of advance project funds 166,827,066.61 73,050,795.30
Others 1,395,517,552.83 509,047,033.72
Total 12,725,203,595.79 15,530,492,099.81
(3) Other cash received relating to investing activities
Amount for the previous
Item Amount for the current period
period
Receipts from forward foreign exchange settlement and purchasing 2,659,865,473.92 342,260,149.12
Net decrease in fixed deposit and others 45,191,721,722.13 3,980,389,291.30
Total 47,851,587,196.05 4,322,649,440.42
(4) Other cash paid relating to investing activities
Amount for the previous
Item Amount for the current period
period
270
Amount for the previous
Item Amount for the current period
period
Net increase in time deposits and payment for forward foreign
5,542,024,468.66
exchange settlement and sales
Others 10,532,866.10
Total 10,532,866.10 5,542,024,468.66
(5) Other cash paid relating to financing activities
Amount for the previous
Item Amount for the current period
period
Received subscriptions for employee stock ownership plan 1,143,534,793.64
Total 1,143,534,793.64
(6) Other cash paid relating to financing activities
Amount for the previous
Item Amount for the current period
period
Net increase in pledge margin on borrowings 16,441,927,495.00 9,825,529,906.65
Cash paid for repurchase of stocks 21,819,537,788.45 5,182,273,853.90
Others 1,645,086,434.41 6,709,713.08
Total 39,906,551,717.86 15,014,513,473.63
68. Supplementary information about cash flow statement
(1) Supplementary information about cash flow statement
Amount in the previous
Supplementary information Amount in the current period
period
1. Convert net profit to cash flow from operating activities:
Net profit 22,831,893,632.89 22,279,242,195.27
Add: Assets depreciation reserves 757,142,125.36 273,445,629.14
Fixed asset depreciation, oil and gas assets accumulated
3,476,137,137.22 3,377,378,887.04
depreciation, productive biological assets accumulated depreciation
Amortization of intangible assets 168,287,721.43 211,327,446.74
Losses on disposal of fixed assets, intangible assets and other
-6,212,295.19 -2,945,975.01
long-term assets (incomes marked with “-”)
Loss from retirement of fixed assets (earnings are marked with
15,960,756.64 7,920,199.63
"-")
Losses from changes in fair value (incomes marked with “-”) 58,130,545.10 -200,153,472.05
Financial expenses (incomes marked with “-”) -2,206,918,302.50 -3,117,118,954.25
Investment losses (earnings are marked with "-") -522,063,222.58 -713,010,071.67
Decrease in deferred income tax assets (increase marked with “-”) -201,498,429.60 993,661,744.02
Increase in deferred income tax liabilities (decrease marked with
220,437,931.82 290,136,496.04
“-”)
Decrease of inventories (increase marked with “-”) -13,233,904,716.97 -3,734,232,466.37
271
Amount in the previous
Supplementary information Amount in the current period
period
Decrease in operating receivables (increase marked with “-”) -2,983,553,411.83 15,242,828,006.57
Increase in operating payables (decrease marked with “-”) -7,479,006,628.48 -18,480,942,047.82
Others [Note] 999,530,415.41 2,811,099,691.88
Net cash flows from operating activities 1,894,363,258.72 19,238,637,309.16
2. Major investing and financing activities not involving cash receipts
--
and payment:
Conversion of debt into capital
Convertible bonds expiring within one year
Fixed assets acquired under finance leases
3. Net changes in cash and cash equivalents: --
Ending balance of cash 29,951,743,758.00 24,225,049,638.15
Less: Beginning balance of cash 24,225,049,638.15 26,372,571,821.49
Add: Ending balance of cash equivalents
Less: Beginning balance of cash equivalents
Net increase in cash and cash equivalents 5,726,694,119.85 -2,147,522,183.34
[Note] "Others" includes the decreased amount RMB 633,908,556.69 of statutory deposit reserve and the net
decreased amount RMB 365,621,858.72 of bill margin.
(2) Net cash paid for acquisition of subsidiaries in the current period
Item Amount
Cash or cash equivalent paid in the current period for business
1,828,275,113.56
combination that occurred in the current period
Including: Bank deposits 1,828,275,113.56
Less: Cash and cash equivalents held by the subsidiary on the date of
80,938,709.57
purchase
Net cash paid for acquisition of subsidiaries 1,747,336,403.99
(3) Composition of cash and cash equivalents
Item Balance at the end of the period Beginning balance
I. Monetary capital 116,939,298,776.87 136,413,143,859.81
Including: Cash on hand 1,021,935.16 468,623.79
Bank deposit for payment at any time 7,036,671,283.79 7,302,375,145.99
Other monetary capital for payment at any time 282,159,290.47 395,860,332.07
Deposits in the central bank available for payment at any
2,052,759.35 2,108,729.48
time
Deposits in other banks available for payment at any time 22,629,838,489.23 16,524,236,806.82
Fixed deposits and accrued interest not in the category of
49,658,731,669.74 91,852,690,730.47
cash and cash equivalents
272
Deposits with restricted use 37,328,823,349.13 20,335,403,491.19
II. Cash equivalents
III. Balance of monetary funds and cash equivalents at the end of the
116,939,298,776.87 136,413,143,859.81
year
Less: Fixed deposits and accrued interest not in the category of
49,658,731,669.74 91,852,690,730.47
cash and cash equivalents
Less: Deposits with restricted use 37,328,823,349.13 20,335,403,491.19
Including: Statutory deposit reserve 1,403,981,413.43 2,037,889,970.12
Bill, letter of credit and other deposits 35,924,841,935.70 18,297,513,521.07
VI. Ending balance of cash and cash equivalents 29,951,743,758.00 24,225,049,638.15
69. Assets with restricted ownership or use rights
Item Book value at the end of the period Restricted reason
Monetary funds 37,328,823,349.13 Statutory deposit reserve and deposits
Accounts receivable 276,321,025.79 Pledged
Receivable financing 12,911,461,792.08 Pledged
Contract assets 422,560,112.06 Pledged
Other current assets 6,800,000,000.00 Pledged
Non-current assets due within one year 60,197,639.98 Pledged
Other debt investments 4,717,527,970.00 Pledged
Other equity instruments investments 8,938,973,543.22 Restricted shares
Long-term equity investments 312,711,807.79 Pledged
Fixed assets 847,908,771.37 Pledged
Construction in progress 225,701,846.53 Pledged
Intangible assets 947,343,396.76 Pledged
Other non-current assets 44,163,315.00 Pledged
Total 73,833,694,569.71
273
70. Monetary items of foreign currencies
(1) Monetary items of foreign currencies
USD BRL Pounds HKD Euro Other currencies Total
Item Converted into Converted into Converted into Converted into Converted into Converted into Converted into
RMB RMB RMB RMB RMB RMB RMB
Exchange rate as of December 31, 2021 6.3757 1.1436 8.6064 0.8176 7.2197 Not Applicable Not Applicable
Monetary assets of foreign currency 9,492,070,463.82 806,164,007.51 173,373,191.16 44,135,425.85 25,148,047.82 279,730.59 10,541,170,866.75
Monetary funds 6,449,482,697.58 227,528,885.95 8,164,571.28 1,805,651.37 42,484.88 6,687,024,291.06
Accounts receivable 3,038,709,912.61 578,403,260.59 173,295,647.50 35,619,564.10 23,279,901.21 237,245.71 3,849,545,531.72
Contract assets 3,383,169.57 3,383,169.57
Other receivables 494,684.06 231,860.97 77,543.66 351,290.47 62,495.24 1,217,874.40
Monetary liabilities of foreign currency 4,730,180,826.38 33,430,777.93 20,305,305.31 79,517,507.35 28,279,931.74 4,891,714,348.71
Short-term borrowings 4,178,592,622.67 4,178,592,622.67
Accounts payable 277,410,941.36 31,466,447.77 20,192,476.51 4,331,820.00 28,256,476.40 361,658,162.04
Other payables 176,789,758.72 1,964,330.16 112,828.80 6,730,436.09 23,455.34 185,620,809.11
Non-current liabilities due within one
66,581,853.64 68,455,251.26 135,037,104.90
year
Other current liabilities 30,805,649.99 30,805,649.99
(2) Description of overseas operating entities
No.
274
Ⅵ Change in the consolidation scope
1. Business combinations not under common control
(1) Business combination involving enterprises not under common control in the current period
Basis for Operating
Name of Point of Equity Net profit from
Equity determinin revenue from
the acquisitio Equity acquisitio Acquisitio the acquisition
acquisitio g the the acquisition
Purchased n of acquisition cost n n date date to
n method acquisition date to
Party equity proportion statement date
date statement date
Gree
Altairnan
October 1,828,275,113.5 Purchase October Acquisition 694,344,061.7 -416,767,701.4
o New 30.47%
31, 2021 6 in cash 31, 2021 of control 6 5
Energy
Inc.
(2) Combination cost and goodwill
Cost of business combination Amount
Cost of business combination 1,828,275,113.56
Less: fair value share of the identifiable net assets acquired 1,215,497,529.64
Amount of goodwill/combination cost less than the share of fair value of identifiable net
612,777,583.92
asset acquired
[Note 1] As described in Remark V-23 "Goodwill", GREE Titanium New Energy became a holding subsidiary
of the Company on October 31, 2021.
[Note 2] As of the acquisition date October 31, 2021, the fair value of the identifiable net assets attributable to
the owners of the parent company of Gree Altairnano New Energy was 1,215,497,529.64 yuan, and the fair value of
the corresponding identifiable net assets was appraised by China United Assets Appraisal Group Limited, which
issued appraisal report ZLPBZ [2022] No. 1362.
(3) Identifiable assets and liabilities of the acquired party on the date of purchase
Gree Altairnano New Energy Inc.
Item
Fair value on the acquisition date Book value on the acquisition date
Assets:
Monetary funds 1,646,843,953.97 1,646,843,953.97
Trading financial liabilities 10,000.00 10,000.00
Accounts receivable 2,779,548,017.55 2,779,548,017.55
Advance payments 215,800,208.73 215,800,208.73
Other receivables 234,176,292.67 234,176,292.67
Inventory 2,135,766,221.72 2,135,766,221.72
Contract assets 996,806,636.13 996,806,636.13
Non-current assets due within one year 2,810,789.73 2,810,789.73
Other current assets 856,356,937.01 856,356,937.01
275
Gree Altairnano New Energy Inc.
Item
Fair value on the acquisition date Book value on the acquisition date
Long-term receivables 3,014,657.86 3,014,657.86
Long-term equity investments 390,685,789.09 535,849,709.81
Other equity instruments investments 2,170,000.00 2,170,000.00
Investment real estate 30,434,649.00 6,404,970.97
Fixed assets 9,851,922,127.54 8,874,157,430.70
Construction in progress 2,341,162,945.24 2,301,429,874.64
Intangible assets 3,078,130,531.23 2,103,825,250.26
Long-term unamortized expenses 18,801,886.89 18,801,886.89
Deferred income tax assets 1,906,423,128.64 1,906,423,128.64
Other non-current assets 277,326,714.43 277,326,714.43
Subtotal of assets 26,768,191,487.43 24,897,522,681.71
Liabilities:
Short-term borrowings 2,202,310,244.21 2,202,310,244.21
Notes payable 1,382,825,460.48 1,382,825,460.48
Accounts payable 4,860,305,562.25 4,860,305,562.25
Contract liabilities 5,024,137,616.68 5,024,137,616.68
Employee pay payable 49,442,281.69 49,442,281.69
Taxes and dues payable 46,366,595.59 46,366,595.59
Other payables 4,233,517,352.93 4,233,517,352.93
Non-current liabilities due within one year 98,518,621.44 98,518,621.44
Other current liabilities 2,088,457,921.70 2,088,457,921.70
Long-term borrowings 850,000,000.00 850,000,000.00
Long-term payables 392,843,262.75 392,843,262.75
Deferred Income 1,186,062,239.50 1,186,062,239.50
Deferred income tax liabilities 13,873,952.69 13,873,952.69
Subtotal of liabilities 22,428,661,111.91 22,428,661,111.91
Net assets 4,339,530,375.52 2,468,861,569.80
(4) Profit or loss arising from the remeasurement of equity held before the purchase date at fair value
Gains or losses on
Book value of equity held remeasurement of previously
Fair value on the purchase date
Name of the Purchased Party before the acquisition date on held equity interest to fair
of share held before that date
the acquisition date value before the acquisition
date
276
Gains or losses on
Book value of equity held remeasurement of previously
Fair value on the purchase date
Name of the Purchased Party before the acquisition date on held equity interest to fair
of share held before that date
the acquisition date value before the acquisition
date
Gree Altairnano New Energy
None None None
Inc.
(5) Method and main assumptions for determining the fair value on the date of purchase
1) Valuation determination method: The assets and liabilities were mainly evaluated using the asset-based
method and the income method.
1) Key assumptions in the evaluation process.
A. The appraised entity is capable of making timely adjustments and innovations in line with the development of
the market and science and technology, while maintaining consistency in its business scope, business methods and
management mode.
B. Except for the fixed-asset investment on the evaluation benchmark date that there is definite evidence
showing that the production capacity will change in the future, it is assumed that the evaluated unit will not carry out
major fixed-asset investment activities that affect its operations in the future income period, and the production
capacity of the enterprise is estimated according to the condition on the evaluation benchmark date;
C. It is assumed that in the future earnings period, the evaluated unit will maintain the turnover of accounts
receivable and accounts payable similar to the historical years, with no payment in arrears that is significantly
different from the historical years;
D. The assets and liabilities declared by the appraised entity are free from title disputes and other economic
disputes;
E. The appraised entity's future sources of funding and costs for R&D and production will not have a material
adverse impact on the enterprise.
2) Reasons for asset appreciation：
A. Machinery and equipment: the market price of some equipment increased and the depreciable life of the
enterprise's equipment was shorter than the economic life of the equipment;
B. Housings and buildings: there was a difference between the depreciable life and the actual economic life, and
some buildings were built a long period of time ago, resulting in an increase in replacement costs (labor,
materials, etc.);
C. Land use rights: the time when the enterprise acquired the land is far from the benchmark date of the
evaluation and the price was low, and the land price increased between the acquisition date and the current
valuation benchmark date.
2. Business combination under common control
No.
3. Counterpurchase
No.
277
4. Disposal of subsidiaries
The
difference
between
the
Amount of
disposal
other
price and Determina
comprehe
the share tion
Proport nsive
of the Gains or methods
ion of Book Fair income
subsidiary losses and main
Equit remaini value of value of related to
Equity 's net arising assumptio
y ng remainin remainin equity
Equity disposa Time point assets in from ns of the
dispo Basis for determining the point at equity g equity g equity investment
Company name disposal l of losing the remeasure fair value
sal which control is lost on the on the on the of the
price proport control consolidat ment of of the
meth date of date of date of original
ion (%) ed remaining remaining
od losing losing losing company
financial equity at equity on
control control control transferred
statement fair value. the date of
(%) into
s losing
investment
correspon control.
profit and
ding to
loss.
the
disposal
investmen
t.
SL Group Jiangwan Rice August, 215,501.7 1,145,00 1,145,00 Book
255,000.00 2.00 Sale Share Transfer Agreement 49.00 None
Industry Co., Ltd 2021 2 0.00 0.00 value
SL Group Lianhe Ecology August, -50,939.5 Book
21,000.00 21.00 Sale Share Transfer Agreement 49.00 None
Farm Co., Ltd 2021 4 value
SL Group Yuan Agriculture September, Industrial and commercial Book
40.00 Sale 2,291.72 30.00 None
Co., Ltd 2021 change registration value
SL Group Lvzhiyuan September, Industrial and commercial 142,792.5 Book
40.00 Sale 30.00 None
Agriculture Co., Ltd 2021 change registration 5 value
SL Group Dongwei Rice September, Industrial and commercial Book
21.00 Sale 92,134.32 30.00 None
Industry Co., Ltd 2021 change registration value
SL(Ningbo) Grain Sales September, Industrial and commercial Book
100.00 Sale 23,927.91 None
Co., Ltd 2021 change registration value
278
5. Change of consolidation scope for other reasons
(1) Newly established entities for the current period
Date of Net assets at the end of Net profit from the combination
Name
establishment the period date to the end of the period
Zhuhai Gree Appliancesal and Mechanical
March 1, 2021 36,931,910.01 6,931,910.01
Engineering (Linyi) Co., Ltd.
Wuhu Gree Intelligent Logistics Co., Ltd March 19, 2021
Gree (Zhuhai Hengqin) GREE Development Co.,
April 25, 2021 998,450,036.83 -1,549,963.17
Ltd.
Gree Electric Appliances (Linyi) Co., Ltd. May 6, 2021 194,574,519.31 -5,425,480.69
Jiangxi Jinrun Real Estate Co., Ltd June 16, 2021 85,809,836.46 -14,190,163.54
Changsha Kinghome Electrics Co., Ltd July 1, 2021 5,720,175.31 -279,824.69
Green Electricity New Material (Maanshan) September 7,
Technology Co., Ltd. 2021
September 26,
Wuhan Yuli Runzhu Real Estate Co., Ltd 6,723,663.82 -276,336.18
2021
October 12,
Huaxingaodao (Maanshan) Technology Co., Ltd.
2021
Zhuhai MinRoad Supply Chain Technology Co., November 19,
Ltd 2021
(2) Other decrease for the current period
The company cancelled its subsidiaries, SL Group Ermapao Eco-Farm Co., Ltd. and Handan YingDong New
Energy Technology Co., Ltd.
279
Ⅶ Equity in other subjects
1. Equity in subsidiaries
(1) Composition of the enterprise group
Shareholding ratio
Serial Main location Place of Nature of (%) Voting right
Name of subsidiary Acquisition mode
No. of operation registration business percentage (%)
Direct Indirect
Chongqing Chongqing Industrial
1 Gree (Chongqing) Electric Appliances Co., Ltd. 97.00 97.00 Establishment
City City manufacture
Business combination
Industrial
2 Zhuhai Landa Compressor Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 involving enterprises under
manufacture
common control
Business combination
Industrial
3 Zhuhai Gree Electrical Co., Ltd Zhuhai City Zhuhai City 100.00 100.00 involving enterprises under
manufacture
common control
Business combination
Industrial
4 Zhuhai Gree Xinyuan Electronics Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 involving enterprises under
manufacture
common control
Industrial Business combinations not
5 Zhuhai Kaibang Motor Manufacturing Co., Ltd Zhuhai City Zhuhai City 100.00 100.00
manufacture under common control
Industrial
6 Gree Electric Appliances Appliance (Hefei) Co., Ltd Hefei city Hefei city 100.00 100.00 Establishment
manufacture
Zhongshan Zhongshan Industrial
7 Gree (ZhongShan) Small Home Appliances Co.,LTD 100.00 100.00 Establishment
City City manufacture
Business combination
8 Zhuhai Gree Group Finance Company Limited [Note 1] Zhuhai City Zhuhai City Finance 94.16 0.46 94.62 involving enterprises under
common control
Manaus, Manaus, Industrial
9 Gree Electric Appliances (Brazil) Co., Ltd. 100.00 100.00 Establishment
Brazil Brazil manufacture
Kowloon, Kowloon, Business combinations not
10 Gree Hong Kong Electric Appliances Sales Co., Ltd. Sales 100.00 100.00
Hong Kong Hong Kong under common control
11 GREE Shanghai Air Conditioners Sales Co., Ltd. [Note 2] Shanghai City Shanghai City Sales 90.00 9.70 99.70 Establishment
280
Shareholding ratio
Serial Main location Place of Nature of (%) Voting right
Name of subsidiary Acquisition mode
No. of operation registration business percentage (%)
Direct Indirect
Industrial
12 Zhuhai Gree Daikin Precision Mold Co., Ltd. Zhuhai City Zhuhai City 51.00 51.00 Establishment
manufacture
Industrial
13 Zhuhai Gree Dakin Device Co., Ltd. Zhuhai City Zhuhai City 51.00 51.00 Establishment
manufacture
Technical
Gree Green Refrigeration Technology Center Co., Ltd. of
14 Zhuhai City Zhuhai City research and 100.00 100.00 Establishment
Zhuhai
development
Zhengzhou Zhengzhou Industrial
15 Gree (Zhengzhou) Electric Appliances Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Industrial
16 Gree (Wuhan) Electric Appliances Co., Ltd. Wuhan City Wuhan City 100.00 100.00 Establishment
manufacture
Zhengzhou Zhengzhou Industrial
17 Gree Green Renewable Resources (Zhengzhou) Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Ningxiang Ningxiang Industrial
18 Hunan Green Resources Recycling Co., Ltd. 100.00 100.00 Establishment
County County manufacture
Industrial
19 Wuhu Green Resources Recycling Co., Ltd. Wuhu City Wuhu City 100.00 100.00 Establishment
manufacture
Shijiazhuang Shijiazhuang Industrial
20 Gree (Shijiazhuang) Small Home Appliances Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Industrial
21 Gree (Wuhu) Electric Appliances Co., Ltd. Wuhu City Wuhu City 100.00 100.00 Establishment
manufacture
Shijiazhuang Shijiazhuang Industrial
22 Shijiazhuang Green Resources Recycling Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Shijiazhuang Shijiazhuang Industrial Business combinations not
23 Gree (Wuhu) Electric Appliances Co., Ltd. 100.00 100.00
City City manufacture under common control
Industrial
24 Tianjin Green Resources Recycling Co., Ltd. Tianjin Tianjin 100.00 100.00 Establishment
manufacture
Industrial
25 Zhuhai HVAC Equipment Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
26 Zhuhai Gree TOSOT Life Electric Appliances Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
281
Shareholding ratio
Serial Main location Place of Nature of (%) Voting right
Name of subsidiary Acquisition mode
No. of operation registration business percentage (%)
Direct Indirect
Industrial
27 Zhuhai Ligao Precision Manufacturing Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Information
28 Zhuhai IVP Information Technology Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
technologies
Changsha Changsha Industrial
29 Changsha Gree HVAC Equipment Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Industrial
30 Gree TOSOT (Suqian) Home Appliances Co., Ltd. Suqian City Suqian City 100.00 100.00 Establishment
manufacture
Industrial
31 Wuhu GREE Precision Manufacturing Co., Ltd. Wuhu City Wuhu City 100.00 100.00 Establishment
manufacture
Industrial
32 Zhuhai GREE Intelligent Equipment Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
33 Zhuhai Hengqin Gree Commercial Factoring Co., Ltd. Zhuhai City Zhuhai City Finance 100.00 100.00 Establishment
Industrial
34 Zhuhai Gree Precision Mold Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
35 Gree (Wuhan) HVAC Equipment Co., Ltd. Wuhan City Wuhan City 100.00 100.00 Establishment
manufacture
Zhuhai GREE Intelligent Equipment Technology Research Industrial
36 Zhuhai City Zhuhai City 100.00 100.00 Establishment
Institute Co., Ltd. manufacture
Industrial
37 Zhuhai Gree New Material Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
38 Gree (Wuhan) Precision Mold Co., Ltd. Wuhan City Wuhan City 100.00 100.00 Establishment
manufacture
Industrial
39 Zhuhai Gree Energy Environment Technology Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Hangzhou Hangzhou Industrial
40 Gree (Hangzhou) Electric Appliances Co., Ltd. 100.00 100.00 Establishment
City City manufacture
Information
41 Zhuhai Gree Info Technology Co., Ltd. Zhuhai City Zhuhai City 51.00 51.00 Establishment
technologies
Industrial
42 Gree (Chengdu) HVAC Equipment Co., Ltd. Chengdu City Chengdu City 100.00 100.00 Establishment
manufacture
282
Shareholding ratio
Serial Main location Place of Nature of (%) Voting right
Name of subsidiary Acquisition mode
No. of operation registration business percentage (%)
Direct Indirect
Technical
Zhuhai Gree CNC Machine Tool Research Institute Co.,
43 Zhuhai City Zhuhai City research and 100.00 100.00 Establishment
Ltd.
development
Gree (Wu'an) Precision Equipment Manufacturing Co., Industrial
44 Wu'an County Wu'an County 70.00 70.00 Establishment
Ltd. manufacture
45 Zhuhai Gree Transportation Co., Ltd. Zhuhai City Zhuhai City Transportation 100.00 100.00 Establishment
Technical
46 Gree (Luoyang) Robot Co., Ltd. Luoyang City Luoyang City research and 100.00 100.00 Establishment
development
Industrial
47 Gree (Nanjing) Electric Appliances Co., Ltd. Nanjing city Nanjing city 100.00 100.00 Establishment
manufacture
Industrial
48 Gree (Luoyang) Electric Appliances Co., Ltd. Luoyang City Luoyang City 100.00 100.00 Establishment
manufacture
Industrial
49 Zhuhai Zero Boundary Integrated Circuit Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
50 Zhuhai Lianyun Technology Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
51 Gree (Chengdu) Electric Appliances Co., Ltd. Chengdu City Chengdu City 100.00 100.00 Establishment
manufacture
Industrial
52 Zhuhai Gree Material Supply Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial
53 Zhuhai Gree Lvkong Technology Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Industrial Business combinations not
54 Hefei Kinghome Electrics Co., Ltd Hefei city Hefei city 100.00 100.00
manufacture under common control
Industrial Business combination under
55 Zhuhai Gree Electormechanical Engineering Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00
manufacture common control
Industrial
56 Gree (Chengdu) Precision Mold Co., Ltd. Chengdu City Chengdu City 100.00 100.00 Establishment
manufacture
Industrial
57 Gree (Luoyang) Washing Machine Co., Ltd. Luoyang City Luoyang City 100.00 100.00 Establishment
manufacture
283
Shareholding ratio
Serial Main location Place of Nature of (%) Voting right
Name of subsidiary Acquisition mode
No. of operation registration business percentage (%)
Direct Indirect
Guochuang Energy Internet Innovation Center Information
58 Zhuhai City Zhuhai City 75.00 5.00 80.00 Establishment
(Guangdong) Co., Ltd [Note 3]. technologies
Industrial
59 Gree (Anji) Precision Mold Co., Ltd. Anji County Anji County 100.00 100.00 Establishment
manufacture
Industrial
60 Gree Green Renewable Resources (Zhuhai) Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Wholesales and
61 Gree E-commerce Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
retail trades
62 Zhuhai Gejian Medical Technology Co., Ltd. Zhuhai City Zhuhai City Medical device 100.00 100.00 Establishment
Industrial
63 Gree Electric (Zhuhai Gaolan Port) Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
manufacture
Chengdu Gree Xinhui Medical Equipment Co., Ltd. [Note
64 Chengdu City Chengdu City Medical device 75.00 5.00 80.00 Establishment
4]
Songyuan Songyuan Business combinations not
65 Songyuan Grain Group Co., Ltd. Agriculture 75.00 75.00
City City under common control
Industrial
66 Gree (Ganzhou) Electric Appliances Co., Ltd. Ganzhou City Ganzhou City 100.00 100.00 Establishment
manufacture
Industrial
67 Tianjin Gree Xinhui Medical Equipment Co., Ltd. Tianjin Tianjin 100.00 100.00 Establishment
manufacture
Industrial
68 Gree Electric Appliances (Linyi) Co., Ltd. Linyi City Linyi City 100.00 100.00 Establishment
manufacture
Real estate
69 Gree (Zhuhai Hengqin) GREE Development Co., Ltd. Zhuhai City Zhuhai City 100.00 100.00 Establishment
industry
Changsha Changsha Industrial
70 Changsha Kinghome Electrics Co., Ltd 100.00 100.00 Establishment
City City manufacture
Research and test Business combinations not
71 GREE Altairnano New Energy Inc. [Note 5] Zhuhai City Zhuhai City 30.47 47.93
development under common control
72 Zhuhai MinRoad Supply Chain Technology Co., Ltd Zhuhai City Zhuhai City Transportation 70.00 70.00 Establishment
[Note 1] The company holds 94.16% of the stock right of Gree Finance Company, and the Company's wholly-owned subsidiaries Gree Electrical and Gree Xinyuan each hold 0.23% of the stock right
of Gree Finance Company, so the Company's control over Gree Finance Company remained unchanged;
284
[Note 2] The Company directly holds 90.00% of stock right of Gree Shanghai Air Conditioners Sales Co., Ltd., and Gree (Chongqing) Electric Appliances Co., Ltd., as the subsidiary of the Company,
holds its remaining 9.70% stock right, so the Company holds its 99.70% stock right in the direct and indirect ways.
[Note 3] The Company directly holds 75.00% of stock right of Guochuang Energy Internet Innovation Center (Guangdong) Co., Ltd, and GREE Altairnano New Energy Inc., as the subsidiary of the
Company, holds its remaining 5.00% stock right, so the Company holds its 80.00% stock right in the direct and indirect ways.
[Note 4] The Company directly holds 75.00% of stock right of Chengdu Gree Xinhui Medical Equipment Co., Ltd., and GREE Altairnano New Energy Inc., as the subsidiary of the Company, holds its
remaining 5.00% stock right, so the Company holds its 80.00% stock right in the direct and indirect ways.
[Note 5] The Company included GREE Altairnano New Energy in the consolidation during the current period, the details and financial information of which are described in Remark 6-1 "Business
combination not under the same control".
(2) Important non-wholly owned subsidiaries
Information of rights and interests held by minority shareholders of important non-wholly owned subsidiaries and profits and losses:
Dividends declared to
Shareholding ratio Profits or losses attributable to
distribute to minority Equity balance of minority
Name of subsidiary of minority minority shareholders in the
shareholders in the current shareholders at the end of the period
shareholders current period
period
Gree (Chongqing) Electric Appliances Co., Ltd. 3.00% 5,739,957.63 49,903,893.39 29,720,208.45
Zhuhai Gree Group Finance Company Limited 5.38% 21,907,875.49 341,819,829.08
(3) Main financial information of important non-wholly owned subsidiaries
Balance at the end of the period
Name of subsidiary
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Gree (Chongqing) Electric Appliances Co.,
1,704,926,333.20 841,684,649.00 2,546,610,982.20 1,544,393,100.17 11,544,266.70 1,555,937,366.87
Ltd.
Zhuhai Gree Group Finance Company
41,592,729,227.65 10,677,512,278.06 52,270,241,505.71 45,552,841,401.15 359,144,354.50 45,911,985,755.65
Limited
(Continued)
Name of subsidiary Beginning balance
285
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Gree (Chongqing) Electric Appliances Co.,
2,920,871,321.12 944,587,263.99 3,865,458,585.11 1,390,158,036.58 12,495,741.40 1,402,653,777.98
Ltd.
Zhuhai Gree Group Finance Company
38,131,598,722.42 14,678,190,451.97 52,809,789,174.39 46,634,275,949.33 232,033,203.40 46,866,309,152.73
Limited
(Continued)
Amount for the current period
Name of subsidiary
Operating revenue Net profit Total comprehensive income Cash flow from operating activities
Gree (Chongqing) Electric Appliances Co., Ltd. 4,260,079,859.97 191,331,921.06 191,331,921.06 203,644,311.67
Zhuhai Gree Group Finance Company Limited 1,904,221,332.12 407,512,564.92 414,775,728.40 3,626,629,910.99
(Continued)
Amount for the previous period
Name of subsidiary
Operating revenue Net profit Total comprehensive income Cash flow from operating activities
Gree (Chongqing) Electric Appliances Co., Ltd. 4,820,238,798.40 75,181,066.77 75,181,066.77 -3,051,189,240.49
Zhuhai Gree Group Finance Company Limited 2,379,170,026.46 679,943,713.67 681,885,945.92 -12,691,657,223.44
286
2. Equities in joint ventures or associates
(1) Important joint ventures or associates
Main Shareholding ratio
Accounting treatment of
location Place of Nature of (%)
Name of invested entity associates or joint
of registration business
Direct Indirect ventures
operation
Zhuhai Ronglin Equity Investment Partnership Zhuhai Zhuhai Business
91.27 Equity method
(Limited Partnership) City City services
Zhuhai Hanling Equity Investment Partnership Zhuhai Zhuhai Business
47.92 Equity method
(Limited Partnership) City City services
(2) Main financial information of important joint ventures
1) Zhuhai Ronglin Equity Investment Partnership (Limited Partnership)
Beginning balance/Amount for the
Item Ending balance/Current amount
previous period
Current assets 11,636,952,794.62 1,536,916.77
Including: cash and cash equivalents 1,753,243.88 1,536,916.77
Non-current assets 8,660,996,176.54
Total assets 11,636,952,794.62 8,662,533,093.31
Current liabilities 42,567,398.01 23,078,118.19
Total liabilities 42,567,398.01 23,078,118.19
Share of net assets calculated by the agreement 8,893,495,450.98 7,061,709,059.56
Total comprehensive income 2,552,450,421.49 1,114,839,883.69
2) Zhuhai Hanling Equity Investment Partnership (Limited Partnership)
Beginning balance/Amount for the
Item Ending balance/Current amount
previous period
Current assets 678,478,666.88 123,178,588.99
Including: cash and cash equivalents 3,478,666.88 476,698.58
Non-current assets 245,000,000.00 800,000,000.00
Total assets 923,478,666.88 923,178,588.99
Current liabilities 2,998,503.81 758,152.76
Total liabilities 2,998,503.81 758,152.76
Share of net assets calculated by the
920,480,163.07 922,420,436.23
agreement
Total comprehensive income 53,187,718.56 29,115,512.75
Dividends received from joint ventures in
55,127,991.72 26,695,076.52
the current year
(3) Significant restrictions on the ability of joint ventures or associates to transfer funds to the Company
No.
287
(4) Excess losses incurred by joint ventures or associates
No.
(5) Unrecognized commitments related to investment in joint ventures
No.
(6) Contingent liabilities related to investment in joint ventures or associates
No.
3. Important co-management
No.
4. Equity in structured entities which were not included in the scope of consolidated financial
statements
No.
Ⅷ Risks associated with financial instruments
Main financial instruments of the Company includes monetary capital, trading financial assets, derivative
financial assets, receivables financing, receivables, disbursement of loans and receivables, buying back the sale of
financial assets, debt investments, other debt investments, other equity instrument investments, other financial
liabilities (e.g., payables) arising from operation, etc. These financial instruments aim to provide funds for operation
of the Company.
The financial instruments of the Company may lead to the main risks of credit risks, liquidity risks and market
risks.
1. Classification information of financial instruments
The book values of various financial instruments on the balance sheet date:
(1) Balance at the end of the period
Classification of financial assets
Financial assets
Financial assets which are measured
measured at fair at their fair values
Item Financial assets
value with changes and of which the
measured at Total
included in other changes are included
amortization costs
comprehensive into other
income comprehensive
income
1. Measured by cost or amortized cost
Monetary funds 116,939,298,776.87 116,939,298,776.87
Accounts receivable 13,840,898,802.76 13,840,898,802.76
Other receivables 334,161,870.18 334,161,870.18
288
Classification of financial assets
Financial assets
Financial assets which are measured
measured at fair at their fair values
Item Financial assets
value with changes and of which the
measured at Total
included in other changes are included
amortization costs
comprehensive into other
income comprehensive
income
1. Measured by cost or amortized cost
Non-current assets due within one year 3,406,416.52 3,406,416.52
Other current financial assets 5,249,688,091.77 5,249,688,091.77
Loans and advances 4,142,652,901.85 4,142,652,901.85
Long-term receivables 2,419,031.07 2,419,031.07
Subtotal 140,512,525,891.02 140,512,525,891.02
2. Measured by their fair values
Derivative financial assets 198,773,198.65 198,773,198.65
Receivable financing 25,612,056,693.07 25,612,056,693.07
Non-current assets due within one year 11,030,165,516.08 11,030,165,516.08
Other current financial assets 1,332,723,758.33 13,436,100.00 1,346,159,858.33
Other debt investments 5,910,056,891.62 5,910,056,891.62
Other equity instruments investments 10,114,246,030.05 10,114,246,030.05
Other non-current financial assets 81,309,327.39 81,309,327.39
Subtotal 53,999,248,889.15 293,518,626.04 54,292,767,515.19
Total 140,512,525,891.02 53,999,248,889.15 293,518,626.04 194,805,293,406.21
(Continued)
Classification of financial liabilities
Item
Derivative financial
Other financial liabilities Total
liabilities
1. Measured by cost or amortized cost
Short-term borrowings 27,617,920,548.11 27,617,920,548.11
Loans from other banks 300,021,500.00 300,021,500.00
Notes payable 40,743,984,514.42 40,743,984,514.42
Accounts payable 35,875,090,911.05 35,875,090,911.05
Financial assets sold for repurchase 746,564,041.09 746,564,041.09
Deposits from customers and
182,681,905.74 182,681,905.74
interbank
Other payables 6,763,119,937.14 6,763,119,937.14
289
Classification of financial liabilities
Item
Derivative financial
Other financial liabilities Total
liabilities
Non-current liabilities due within one
1,243,822,222.57 1,243,822,222.57
year
Other current liabilities 7,819,060,868.44 7,819,060,868.44
Long-term borrowings 8,960,864,258.30 8,960,864,258.30
Long-term payables 446,194,591.92 446,194,591.92
Subtotal 130,699,325,298.78 130,699,325,298.78
Total 130,699,325,298.78 130,699,325,298.78
(2) Beginning balance
Classification of financial assets
Financial assets which
Financial assets
are measured at their
Item Financial assets measured at fair value
fair values and of
measured at with changes included Total
which the changes are
amortization costs in other
included into other
comprehensive income
comprehensive income
1. Measured by cost or amortized
cost
Monetary funds 136,413,143,859.81 136,413,143,859.81
Accounts receivable 8,738,230,905.44 8,738,230,905.44
Other receivables 147,338,547.86 147,338,547.86
Other current financial assets 13,039,786,857.75 13,039,786,857.75
Loans and advances 5,273,805,581.52 5,273,805,581.52
Subtotal 163,612,305,752.38 163,612,305,752.38
2. Measured by their fair values
Trading financial liabilities 370,820,500.00 370,820,500.00
Derivative financial assets 285,494,153.96 285,494,153.96
Receivable financing 20,973,404,595.49 20,973,404,595.49
Other current financial assets 22,298,300.00 22,524,600.00 44,822,900.00
Other debt investments 502,202,293.17 502,202,293.17
Other equity instruments
7,788,405,891.47 7,788,405,891.47
investments
Other non-current financial assets 2,003,483,333.33 2,003,483,333.33
Subtotal 29,286,311,080.13 2,682,322,587.29 31,968,633,667.42
Total 163,612,305,752.38 29,286,311,080.13 2,682,322,587.29 195,580,939,419.80
(Continued)
290
Classification of financial liabilities
Item
Derivative financial
Other financial liabilities Total
liabilities
Measured by cost or amortized cost
Short-term borrowings 20,304,384,742.34 20,304,384,742.34
Deposits from customers and
261,006,708.24 261,006,708.24
interbank
Loans from other banks 300,020,250.00 300,020,250.00
Notes payable 21,427,071,950.32 21,427,071,950.32
Accounts payable 31,604,659,166.88 31,604,659,166.88
Financial assets sold for repurchase 475,033,835.62 475,033,835.62
Other payables 2,379,395,717.44 2,379,395,717.44
Other current liabilities 7,104,734,012.61 7,104,734,012.61
Long-term borrowings 1,860,713,816.09 1,860,713,816.09
Total 85,717,020,199.54 85,717,020,199.54
2. Credit risks
Credit risks refer to financial losses suffered by one party due to the non-performance of obligations by the other
party of financial instrument.
The Company will have transactions with recognized customers with a good reputation only. According to the
policy of the Company, all the customers who require the credit form for transactions shall undergo credit review.
Besides, the Company implements continuous monitoring on the balance of accounts receivable to ensure that the
Company is not confronted with the major risk of bad debts.
Financial assets of the Company include monetary capital, receivables financing, etc. The credit risks of these
financial assets come from nonperformance of the transaction counterparty, and the maximum risk exposure is equal
to the carrying amount of these instruments. Trade terms between the Company and customers focus on advances,
banker's acceptance bill or the mode of paying on delivery, assisted by transaction with credit.
The monetary capital is deposited in state-owned financial institutions with high credit rating, minimizing the
risk; the receivables financing is mainly banker's acceptance bills, and the risk exposure is rather small. The book
value of receivables financing, accounts receivable, other receivables, contract assets, loans and advance money and
long-term receivables in the consolidated balance sheet is the highest credit risk with which the Company may be
confronted.
As at the end of the Report Period, the Company's receivables financing, accounts receivable, other accounts
receivable, contract assets, loans and advance money and long-term receivables accounts for 14.11% of the total
assets (the balance at the beginning of the period is 12.61%), and the above amounts are mainly due within 1 year, so
the Company has no significant credit risk. For the Company's credit risk exposures arising from the above financial
291
assets, see the disclosed information in Note V. 4 "Receivables", Note V. 5 "Receivables financing", Note V. 7
"Other receivables", Note V. 9 "Contract assets", Note V. 12 "Loans and advances granted" and Note V. 14
"Long-term receivables".
3. Liquidity risk
Liquidity risks refer to risks of fund shortage generated when the enterprise performs the obligation to settle
accounts by cash payment or other financial assets.
As indicated by changes in the Company’s financial instruments at the beginning and end of the period, the
proportion of the Company's "Financial assets" to "Financial liabilities" at the end of the report period was 1.49
(which was 2.28 at the beginning of the period), which shows that the Company has adequate liquidity and the risk in
shortage of liquidity is low.
4. Market risks
Market risks refer to fluctuation risks of the fair value or future cash flow of financial instrument due to changes
in the market price, including exchange rate risk and interest rate risk.
(1) Exchange rate risk
Exchange rate risk refers to the fluctuation risk of the fair value or future cash flow of financial instruments due
to changes in the foreign exchange rate.
As at December 31, 2021, the amounts of foreign currency financial assets and liabilities held by the Company
converted into RMB are presented in details in Note (V) 70 (1) "Foreign Currency Monetary Items".
The Company will minimize the exchange risk by carrying out the forward exchange transaction business and
controlling the scale of foreign currency assets and liabilities according to changes in the market exchange rate.
(2) Interest rate risks
Interest rate risk refers to the fluctuation risk of the fair value or future cash flow of financial instruments due to
changes in the market rate of interest.
Set out below are the Company's liabilities with interests as of December 31, 2021:
Report Item Amount Interest rate range Remark
Floating interest
Short-term borrowings 27,617,920,548.11 0.63%-9.00%
rate
Floating interest
Deposits from customers and interbank 182,681,905.74 0.55%-4.13%
rate
Loans from other banks 300,021,500.00 2.58%
Floating interest
Long-term borrowings 8,960,864,258.30 3.1%-6.18%
rate
Floating interest
Money from financial assets sold for repurchase 746,564,041.09 3.00%~3.20%
rate
Floating interest
Non-current liabilities due within one year 1,243,822,222.57 4.67%-13.00%
rate
292
Other current liabilities 4,048,840,948.73 2.60%
Floating interest
Long-term payables 446,194,591.92 4.67%-6.175%
rate
Total 43,546,910,016.46
Ⅸ Fair value disclosure
1. Fair values of assets and liabilities at the end of period that are measured at the fair value
Ending fair value
Measurement of the Measurement of the
Item Measurement of the fair
fair value at the first fair value at the second
value at the third level Total
level level
Continuous fair value measurement
Derivative financial assets 198,773,198.65 198,773,198.65
Receivable financing 25,612,056,693.07 25,612,056,693.07
Non-current financial assets due
60,392,960.52 10,969,772,555.56 11,030,165,516.08
within one year
Other current assets 43,930,525.00 1,302,229,333.33 1,346,159,858.33
Other debt investments 727,591,613.84 5,182,465,277.78 5,910,056,891.62
Other equity instruments
10,107,246,030.05 7,000,000.00 10,114,246,030.05
investments
Other non-current financial assets 81,309,327.39 81,309,327.39
Total of assets measured by fair
10,939,161,129.41 43,346,606,385.78 7,000,000.00 54,292,767,515.19
value continuously
2. Basis for determining market prices of items continuously and not continuously measured at the
first-level fair value
Non-current assets-bonds due within one year, other current assets, other debt investment-bonds, and other
equity instrument investments held by the Company at the first-level fair value are determined based on the quotation
of corresponding products and investment projects on the open market.
3. Qualitative and quantitative information on valuation techniques and important parameters adopted
by items continuously and not continuously measured at the second-level fair value
Receivables financing held by the Company at the second-level fair value is the bank acceptance bills and
commercial acceptance bills held by the Company, and their corresponding transfer and discounted amounts are used
as the basis for determining their market prices;
Non-current assets due within one year, other current assets, other debt investments and other non-current
financial assets, derivative financial assets and other non-current financial assets held by the Company at the
second-level fair value are mainly forward hedging instruments, large-denomination negotiable certificate of deposit
and assets management plan with a recovery period of more than one year, and the recoverable amount of the
corresponding financial assets is used as the basis for determining the market price.
293
4. Qualitative and quantitative information on valuation techniques and important parameters adopted
by items continuously and not continuously measured at the third-level fair value
Non-trading equity instrument investments designated to be measured at their fair values and of which the
changes are recorded into comprehensive income, which are held by the Company at the third layer, are mainly
equity investment projects which cannot be verified with the data from the observable active market and of which the
financial forecast is made with their own data.
5. For continuous fair value measurement items, in case of conversion among different levels during the
current period, the reasons for conversion and the policy for determining the timing for conversion
No.
6. Changes in valuation techniques and reasons for changes occurred during the current period
No.
7. Particulars on fair value of financial assets and liabilities which are not measured at fair value
No.
Ⅹ Related parties and related transaction
1. Parent company of the Company
The Company has no controlling shareholders or substantial controllers.
2. Subsidiaries of the Company
For details, see Note (VII)-1 "Equity in subsidiaries".
3. Joint ventures and associates of the Company
For important joint ventures and associates of the Company, see the Note VII-2 "Equity in ventures and
associates of the Company" for details.
4. Other related parties
Name of other affiliates Relationships of other related parties with the Company
Shanghai Highly (Group) Co., Ltd. and its holding subsidiaries The Company holds more than 5.00% of its shares
Henan Province Hongli Electric Sales Co., Ltd. The son of the director of the Company acts as its general manager
Henan Huizhong Yifeng Electronic Commerce Co., Ltd. The director of the Company act as its board chairman
Companies where directors of the Company act as executive
Henan Shengshi Xinxing Gree Trading Co., Ltd.
directors
Zhejiang Tongcheng Gree Electric Appliances Co., Ltd. and its The Company's director holds its equity and serves as its board
holding companies chairman
Companies where directors of the Company act as executive
Zhejiang Shengshi Xinxing Gree Trading Co., Ltd.
directors and general managers
GREE Altairnano New Energy Inc. and its subsidiaries and Companies and their subsidiaries and holding subsidiaries where the
holding subsidiaries [Note 1] chairman of the Company serves as a director
It is a wholly-owned or controlled subsidiary where the Company's
Nanyang Lida Optic-electronics Co., Ltd.
independent director serves as its independent director.
294
Name of other affiliates Relationships of other related parties with the Company
It is a wholly-owned or controlled subsidiary where the Company's
Shenzhen Royole Technology Co. Ltd.
independent director serves as its independent director.
Guangdong Guangxin Junda Law Firm The Company's independent directors serve as its partner chairmen
Hunan Green Renewable Resources Recycling Co., Ltd. The Company has great influence upon it.
Wuhu Green Renewable Resources Recycling Co., Ltd. The Company has great influence upon it.
The younger brother of the Company's supervisor is an executive
Zibo Qiaopeng Trade Co., Ltd.
director and manager of this company.
It is a subsidiary where sons of supervisors of the Company act as
Shandong Meili Property Co., Ltd.
executive directors and managers.
Shandong Red April Holdings Group Co., Ltd. and its The supervisors of the Company act as its executive directors and
subsidiaries general managers.
The supervisors of the Company act as its executive directors and
Shandong Jierui Logistics Co., Ltd.
general managers.
Subsidiaries and holding companies of Zhuhai Gree Group Co., Subsidiaries and holding subsidiaries of the Company's original
Ltd. [Note 2] controlling shareholder
[Note 1] GREE Altairnano New Energy Inc. (formerly: Yinlong New Energy Co., Ltd.) and its subsidiaries and holding subsidiaries,
which are not other related parties of the Company after October 31, 2021, are subsidiaries of the Company. Therefore, only the amount
of connected transactions from January 2021 to October 2021 will be disclosed. For details of the connected transactions and dealings
between the Company and Gree Altairnano New Energy", please refer to Remark X-8.
[Note 2] Zhuhai Gree Group Co., Ltd. and its subsidiaries and its holding company are not other related parties of the Company
after January 23, 2021, therefore, only the related transactions occurring from January 1 to January 23 are disclosed.
5. Related transactions
(1) Related transactions of purchase and sale of goods, provision and acceptance of services
1) Purchase of commodities/receiving of services
Related Content of related Amount for the Amount for the
Related party
transaction types transactions current period previous period
Zhuhai Gree Group Co., Ltd. and its holding
Deposit-taking Interest expenses 89.00 168,517.68
companies
Zhejiang Shengshi Xinxing Gree Trading
Deposit-taking Interest expenses 96.10 640.04
Co., Ltd.
Shandong Jierui Logistics Co., Ltd. Deposit-taking Interest expenses 540.83
Henan Shengshi Xinxing Gree Trading Co.,
Deposit-taking Interest expenses 7,700.16 5,393.77
Ltd.
Zhejiang Tongcheng Gree Electric
Appliances Co., Ltd. and its holding Deposit-taking Interest expenses 85.02 105.88
companies
Shandong Zhirun Electric Appliances Co.,
Deposit-taking Interest expenses 0.65
Ltd.
Shandong Meili Property Co., Ltd. Deposit-taking Interest expenses 0.17 8.75
Shanghai Highly (Group) Co., Ltd. and its Material
Raw material 2,527,902,885.40 2,057,922,093.99
subsidiaries and holding subsidiaries Procurement
Wuhu Green Renewable Resources Material
Raw material 509,270.48
Recycling Co., Ltd. Procurement
Hunan Green Renewable Resources Material
Raw material 7,895,587.14 4,281,006.00
Recycling Co., Ltd. Procurement
295
Related Content of related Amount for the Amount for the
Related party
transaction types transactions current period previous period
Material
Beijing Gree Technology Co., Ltd. Accessories 58,532,547.11 46,875,937.46
Procurement
Material
Shenzhen Royole Technology Co. Ltd. Accessories 175,706.84
Procurement
Accessories and
Zhuhai Gree Group Co., Ltd. and its holding Material
infrastructure 38,209,208.33 5,563,078.35
companies Procurement
projects
Batteries, energy
storage
Purchase of fixed
Gree Altairnano New Energy Inc. and its components, new
assets and 114,441,306.42 456,527,871.20
subsidiaries and holding subsidiaries energy vehicles
materials
and accessories,
etc.
Procurement of
Chongqing Pargo Mechanical Equipment Accessories,
materials and 246,203.54 15,961,014.17
Co., Ltd. cleaning services
services
Liaowang All Media Communication Co., Service Publicity and
1,849,056.61 4,150,943.41
Ltd. procurement advertising fee
Service
Henan Yuze Finance Leasing Co., Ltd. Interest expenses 1,387,542.20
procurement
Total 2,750,648,014.04 2,591,966,422.66
2) Schedule of goods sold/services provided
Related Content of related Amount incurred in current Amount for the previous
Related party
transaction types transactions period period
Henan Shengshi
Xinxing Gree Loan Interest revenue 42,501,985.05
Trading Co., Ltd.
Shandong Jierui
Loan Interest revenue 10,440,199.17
Logistics Co., Ltd.
Zhejiang Shengshi
Xinxing Gree Loan Interest revenue 17,299,672.42
Trading Co., Ltd.
Shandong Zhirun
Electric Appliances Loan Interest revenue 141,115.31
Co., Ltd.
Beijing Gree
Technology Co., Loan Interest revenue 1,055,231.60
Ltd.
Shanghai Highly
(Group) Co., Ltd.
and its subsidiaries Loan Interest revenue 8,055.86
and holding
subsidiaries
Shandong Jierui
Loan Handling charge income 194.34
Logistics Co., Ltd.
Henan Shengshi
Xinxing Gree Loan Handling charge income 14.62 189.15
Trading Co., Ltd.
Zhejiang Shengshi
Xinxing Gree Loan Handling charge income 378.30
Trading Co., Ltd.
Shandong Zhirun
Electric Appliances Loan Handling charge income 5.19
Co., Ltd.
296
Related Content of related Amount incurred in current Amount for the previous
Related party
transaction types transactions period period
Shandong Meili
Loan Handling charge income 5.19
Property Co., Ltd.
Zhejiang
Tongcheng Gree
Electric Appliances Loan Handling charge income 9.91
Co., Ltd. and its
holding companies
Henan Shengshi
Xinxing Gree Sale of goods Sales revenue 2,817,582,876.54 4,285,955,595.20
Trading Co., Ltd.
Zhejiang Shengshi
Xinxing Gree Sale of goods Sales revenue 6,174,062,804.40 4,509,434,341.94
Trading Co., Ltd.
Shanghai Highly
(Group) Co., Ltd.
and its subsidiaries Sale of goods Sales revenue 1,066,814,988.67 1,135,301,130.49
and holding
subsidiaries
Gree Altairnano
New Energy Inc.
and its subsidiaries Sale of goods Sales revenue 709,032,680.61 123,800,930.62
and holding
subsidiaries
Beijing Gree
Technology Co., Sale of goods Sales revenue 154,826.18 21,750,223.87
Ltd.
Zhuhai Gree Group
Co., Ltd. and its Sale of goods Sales revenue 1,051,467.87 26,204,546.50
holding companies
Shandong Red
April Holdings
Sale of goods Sales revenue 152,586.11 18,008,378.79
Group Co., Ltd. and
its subsidiaries
Henan Huizhong
Yifeng Electronic
Sale of goods Sales revenue 86,581,480.47 79,088,623.28
Commerce Co.,
Ltd.
Chongqing Pargo
Mechanical
Sale of goods Sales revenue 474,477.90
Equipment Co.,
Ltd.
Wuhan Digital
Design and
Manufacturing Sale of goods Sales revenue 2,856,000.00
Innovation Center
Co., Ltd.
Henan Province
Hongli Electric Sale of goods Sales revenue 14,158.41
Sales Co., Ltd.
Henan Yuze
Finance Leasing Sale of goods Sales revenue 10,662.83
Co., Ltd.
Zibo Qiaopeng
Sale of goods Sales revenue 452.83
Trade Co., Ltd.
Guangdong
Guangxin Junda Sale of goods Sales revenue 29,989.22
Law Firm
297
Related Content of related Amount incurred in current Amount for the previous
Related party
transaction types transactions period period
Shenzhen Royole
Technology Co. Sale of goods Sales revenue 3,892.30
Ltd.
Total 10,856,556,183.62 10,273,257,987.52
[Note] Songwon Grain Group Co., Ltd. and its subsidiaries, Zhuhai Vantone Special Engineering Plastics Co.,
Ltd. and Shandong Shengshi Xinxing Gree Trading Co., Ltd. are not other related parties of the Company in the
current period.
(2) Associated trusteeship management/contracting or entrusted management/outsourcing
No.
(3) Associated lease
1) The Company as the lessor:
Confirmed income earned on leases
Name of the lessee Type of leased assets
Amount for the Amount for the
current period previous period
Shanghai Highly (Group) Co., Ltd. and its holding
Lease of fixed assets 884.96
subsidiaries
Total 884.96
2) The Company as the lessee:
Confirmed rental expenditure
Name of the lessor Type of leased assets
Amount for the Amount for the
current period previous period
Zhuhai Gree Group Co., Ltd. and its holding companies Lease of fixed assets 524,859.52
Gree Altairnano New Energy Inc. and its subsidiaries and
Lease of fixed assets 22,101,319.15 8,361,254.31
holding subsidiaries
Total 22,101,319.15 8,886,113.83
(4) Associated guarantee
No.
(5) Fund borrowing of related party
No.
(6) Asset transfer and debt restructuring of the related party
No.
(7) Remunerations for key management personnel
Item Amount for the current period Amount for the previous period
Remunerations for key management
28,776,688.73 21,711,900.94
personnel
298
(8) Other related transactions
No.
6. Accounts receivable and payable by related parties
(1) Receivable items
Balance at the end of the period Beginning balance
Item Related party
Bad debt Bad debt
Book balance Book balance
provision provision
Shanghai Highly (Group) Co.,
Accounts
Ltd. and its subsidiaries and 275,974,949.72 13,798,747.48 252,078,651.19 12,603,932.56
receivable
holding subsidiaries
Accounts Wuhu Green Renewable
6,053,077.41 1,210,615.48 6,053,168.30 302,658.42
receivable Resources Recycling Co., Ltd.
Shanghai Highly (Group) Co.,
Other
Ltd. and its subsidiaries and 300.00 15.00
receivables
holding subsidiaries
Other Henan Yuze Finance Leasing
2,000,000.00 100,000.00
receivables Co., Ltd.
Receivable Henan Shengshi Xinxing Gree
1,682,308,050.00 1,060,266,463.33
financing Trading Co., Ltd.
Receivable Shandong Jierui Logistics Co.,
807,003.00 250,000.00
financing Ltd.
Receivable Zhejiang Shengshi Xinxing Gree
563,643,910.00 51,154,515.78
financing Trading Co., Ltd.
Shanghai Highly (Group) Co.,
Receivable
Ltd. and its subsidiaries and 209,459,790.34 250,468,129.83
financing
holding subsidiaries
Zhejiang Tongcheng Gree
Receivable
Electric Appliances Co., Ltd. and 7,212,720.20 54,790,620.60
financing
its holding companies
Receivable Henan Province Hongli Electric
254,056,500.00
financing Sales Co., Ltd.
Advance Beijing Gree Technology Co.,
4,525,924.98
payments Ltd.
Shanghai Highly (Group) Co.,
Advance
Ltd. and its subsidiaries and 159,295.76 18,388,182.09
payments
holding subsidiaries
Wuhan Digital Design and
Contract
Manufacturing Innovation Center 230,520.00 11,526.00 461,040.00 23,052.00
assets
Co., Ltd.
Total 3,001,905,816.43 15,120,888.96 1,698,436,996.10 12,929,657.98
(2) Accounts payable
Balance at the end of Beginning
Item Related party
the period balance
Shanghai Highly (Group) Co., Ltd. and its subsidiaries
Contract liabilities 82,274.34
and holding subsidiaries
892,271,917
Contract liabilities Henan Shengshi Xinxing Gree Trading Co., Ltd. 1,467,255,376.86
.85
299
Balance at the end of Beginning
Item Related party
the period balance
195,303,464
Contract liabilities Zhejiang Shengshi Xinxing Gree Trading Co., Ltd. 711,732,407.73
.04
Contract liabilities Nanyang Lida Optic-electronics Co., Ltd. 90,000.00
Other current liabilities - Output Shanghai Highly (Group) Co., Ltd. and its subsidiaries
10,695.66
tax to be wrote-off and holding subsidiaries
Other current liabilities - Output 115,995,349.
Henan Shengshi Xinxing Gree Trading Co., Ltd. 190,743,199.00
tax to be wrote-off 32
Other current liabilities - Output 25,389,450.
Zhejiang Shengshi Xinxing Gree Trading Co., Ltd. 92,525,213.00
tax to be wrote-off 32
Deposit-taking Zhejiang Shengshi Xinxing Gree Trading Co., Ltd. 21,518.97
Deposit-taking Shandong Jierui Logistics Co., Ltd. 0.26
Zhejiang Tongcheng Gree Electric Appliances Co., Ltd.
Deposit-taking 16,031.72 29,820.55
and its holding companies
Deposit-taking Henan Shengshi Xinxing Gree Trading Co., Ltd. 10,963.99 273,262.06
Deposit-taking Shandong Meili Property Co., Ltd. 2,464.18
Deposit taking - Accrued interest Zhejiang Shengshi Xinxing Gree Trading Co., Ltd. 2.30
Deposit taking - Accrued interest Shandong Meili Property Co., Ltd. 0.26
Zhejiang Tongcheng Gree Electric Appliances Co., Ltd.
Deposit taking - Accrued interest 2.70 3.19
and its holding companies
Deposit taking - Accrued interest Henan Shengshi Xinxing Gree Trading Co., Ltd. 1.84 19.11
Shanghai Highly (Group) Co., Ltd. and its subsidiaries 205,355,411.
Accounts payable 315,231,596.28
and holding subsidiaries 45
17,669,736.
Accounts payable Beijing Gree Technology Co., Ltd. 7,746,578.74
14
3,341,338.5
Accounts payable Hunan Green Renewable Resources Recycling Co., Ltd. 2,455,852.10
2
3,789,547.7
Accounts payable Wuhu Green Renewable Resources Recycling Co., Ltd. 3,789,547.79
9
Accounts payable Henan Shengshi Xinxing Gree Trading Co., Ltd. 249,988.68
Accounts payable Shenzhen Royole Technology Co. Ltd. 29,815.13
Other payables Shenzhen Royole Technology Co. Ltd. 2,462.10
Shanghai Highly (Group) Co., Ltd. and its subsidiaries 1,013,050.0
Other payables 12,200.00
and holding subsidiaries 0
Other payables Beijing Gree Technology Co., Ltd. 205,402.42
Zhejiang Tongcheng Gree Electric Appliances Co., Ltd.
Other payables 204.24 204.24
and its holding companies
Other payables Shandong Jierui Logistics Co., Ltd. 0.26
Other payables Zhejiang Shengshi Xinxing Gree Trading Co., Ltd. 371,617.37
Long-term payables Henan Yuze Finance Leasing Co., Ltd. 47,732,374.61
1,460,661,9
Total 2,840,088,404.14
62.97
7. Commitment of related parties
No.
300
8. The related transactions between the Company and GREE Altairnano New Energy Inc. and its subsidiaries and holding subsidiaries
(1) Purchase of commodities/receiving of services and payables and prepayments
Beginning balance
Amount incurred in Amount incurred in
Related party Related transaction types Content of related transaction
current period previous period Other non-current assets
(+)/accounts payable (-)
Zhuhai Guangtong Purchase of fixed assets and Batteries, energy storage components, new
5,788,013.23 32,534,842.93 -76,780,334.68
Automobile Co., Ltd. materials energy vehicles and accessories, etc.
Zhuhai Gree Altairnano Purchase of fixed assets and Batteries, energy storage components, new
102,223.77 -218,273.50
Electric Appliances, Co., Ltd materials energy vehicles and accessories, etc.
Gree Altairnano New Energy Purchase of fixed assets and Batteries, energy storage components, new
396,110.22 16,381,555.97 -2,464,269.09
Inc. materials energy vehicles and accessories, etc.
Shijiazhuang Zhongbo Purchase of fixed assets and Batteries, energy storage components, new
80,744.91 384,706.96 320,894.16
Automobile Co., Ltd. materials energy vehicles and accessories, etc.
Tianjin Guangtong Purchase of fixed assets and Batteries, energy storage components, new
34,513.27 156,878.28 8,805.08
Automobile Co., Ltd. materials energy vehicles and accessories, etc.
Tianjin Gree Altairnano New Purchase of fixed assets and Batteries, energy storage components, new
166,914.96 2,106,414.29 -243,255.40
Energy Co., Ltd. materials energy vehicles and accessories, etc.
Purchase of fixed assets and
Chengdu Gree Titanium New Batteries, energy storage components, new
materials and lease of fixed 3,852,804.97 385,045.87 -419,700.00
Energy Co., Ltd. energy vehicles and accessories, etc.
assets
Hebei Gree Titanium New Purchase of fixed assets and Batteries, energy storage components, new
447,955.02 90,311.20 50,000.00
Energy Co., Ltd. materials energy vehicles and accessories, etc.
Purchase of fixed assets and
Chengdu Guangtong Batteries, energy storage components, new
materials and lease of fixed 98,479,702.80 404,164,773.10 9,198,296.24
Automobile Co., Ltd. energy vehicles and accessories, etc.
assets
Northern Aotai Purchase of fixed assets and Batteries, energy storage components, new
8,805,956.71 6,317.88 50,000.00
Nanotechnology Co., Ltd. materials energy vehicles and accessories, etc.
Luoyang Guangtong Purchase of fixed assets and Batteries, energy storage components, new
141,592.92 701,769.91
Automobile Co., Ltd. materials energy vehicles and accessories, etc.
Purchase of fixed assets and
Luoyang Gree Altairnano Batteries, energy storage components, new
materials and lease of fixed 18,246,092.79 7,976,509.12
New Energy Co., Ltd. energy vehicles and accessories, etc.
assets
301
Beginning balance
Amount incurred in Amount incurred in
Related party Related transaction types Content of related transaction
current period previous period Other non-current assets
(+)/accounts payable (-)
Total Total 136,542,625.57 464,889,125.51 -70,497,837.19
[Note] The above-mentioned related transactions included RMB 114,441,306.42 for purchase of fixed assets and materials and RMB 22,101,319.15 for lease of fixed
assets, totaling RMB 136,542,625.57.
302
(2) Sales of commodities/rendering of services and receivables and account collected in advance
Beginning balance
Related
Amount incurred in Amount incurred in Accounts receivable
Related party transaction Content of related transaction
current period previous period (+)/contract liabilities Receivables financing /
types
(-)/other current liabilities other current assets
(-)
Sales of intelligent equipment,
Hebei Gree Titanium New Energy Co., Ltd. Sale of goods molds, vehicle air conditioners, 30,418,872.26 11,484,769.87 3,533,733.09
power systems, etc.
Sales of intelligent equipment,
Northern Aotai Nanotechnology Co., Ltd. Sale of goods molds, vehicle air conditioners, 1,336,159.29
power systems, etc.
Sales of intelligent equipment,
Chengdu Guangtong Automobile Co., Ltd. Sale of goods molds, vehicle air conditioners, 171,315,666.03 4,189,479.65 4,734,112.00
power systems, etc.
Sales of intelligent equipment,
Tianjin Guangtong Automobile Co., Ltd. Sale of goods molds, vehicle air conditioners, 217,607,143.70 3,982,247.77 4,499,940.00
power systems, etc.
Sales of intelligent equipment,
Chengdu Gree Titanium New Energy Co.,
Sale of goods molds, vehicle air conditioners, 16,192,621.18 52,625,416.72
Ltd.
power systems, etc.
Sales of intelligent equipment,
Gree Altairnano New Energy Inc. Sale of goods molds, vehicle air conditioners, 162,039,130.29 25,795,708.14 2,460,901.13 24,186,193.10
power systems, etc.
Sales of intelligent equipment,
Tianjin Gree Altairnano New Energy Co.,
Sale of goods molds, vehicle air conditioners, 665,000.00
Ltd.
power systems, etc.
Sales of intelligent equipment,
Zhuhai Guangtong Automobile Co., Ltd. Sale of goods molds, vehicle air conditioners, 46,673,904.58 4,034,509.62 6,608,210.07 391,183.31
power systems, etc.
Sales of intelligent equipment,
Zhuhai Gree Altairnano Electric
Sale of goods molds, vehicle air conditioners, 63,383,608.04 18,096,962.94 20,133,788.34 10,000,000.00
Appliances, Co., Ltd
power systems, etc.
Sales of intelligent equipment,
Shijiazhuang Zhongbo Automobile Co.,
Sale of goods molds, vehicle air conditioners, 3,591,835.91 4,055,582.60 586,774.97
Ltd.
power systems, etc.
303
Beginning balance
Related
Amount incurred in Amount incurred in Accounts receivable
Related party transaction Content of related transaction
current period previous period (+)/contract liabilities Receivables financing /
types
(-)/other current liabilities other current assets
(-)
Sales of intelligent equipment,
Luoyang Gree Altairnano New Energy Co.,
Sale of goods molds, vehicle air conditioners, 42,470.80
Ltd.
power systems, etc.
Sales of intelligent equipment,
Luoyang Guangtong Automobile Co., Ltd. Sale of goods molds, vehicle air conditioners, 12,487.63
power systems, etc.
Sales of intelligent equipment,
Nanjing Guangtong Automobile Co., Ltd. Sale of goods molds, vehicle air conditioners, 10,616.81
power systems, etc.
Total 709,032,680.61 123,800,930.62 46,026,267.23 35,829,151.38
304
Ⅺ Commitments and contingencies
1. Important commitment
The Company had no significant commitments to be disclosed.
2. Contingencies
In December 2015, Sunshine Life Insurance Co., Ltd. (hereinafter referred to as "Sunshine Insurance") and
GREE Altairnano New Energy Inc.(hereinafter referred to as "GREE Altairnano New Energy") and the original
major shareholder Zhuhai Yinlong Investment Holding Group Co., Ltd (hereinafter referred to as "Yinlong Group")
and the actual controller Wei Yincang signed a capital increase agreement and a supplementary agreement. It was
agreed that Sunshine Insurance would increase its capital by RMB 1 billion to GREE Altairnano New Energy, and
agreed on a "performance bet". After that, Sunshine Insurance filed an arbitration at Shenzhen International
Arbitration Court for the company's performance did not meet the standards, requiring that GREE Altairnano New
Energy, Yinlong Group, and Wei Yincang to make performance compensation, with a specific appeal of RMB 1
billion in principal and more than RMB 150 million in interest, totaling RMB 1.15 billion. According to the capital
increase agreement and supplementary agreement, Yinlong Group and Wei Yincang bear the direct responsibility for
performance compensation, and GREE Altairnano New Energy bears indirect responsibility for the debt when the
performance does not reach the agreed standard. This case is currently in the stage of waiting for the arbitral tribunal
to investigate and obtain evidence and ruling after two hearings and several written exchanges of views with each
other. The amount of litigation cost required to be borne by GREE Altairnano can hardly be estimated yet.
A capital increase agreement similar to "performance bet" with Sunshine Insurance involves a total of 7
shareholders (excluding Sunshine Insurance), with an investment principal of RMB 1.11 billion.
3. Others
No.
Ⅻ Events after the balance sheet date
1. Important non-adjustment events
Gree Electric Appliances, Inc. of Zhuhai announced on November 17, 2021 that it intends to acquire
270,360,000 shares (representing 29.48% of the total share capital of the subject company as at the date of
announcement) of Zhejiang Dunan Artificial Environment Co., Ltd. (hereinafter referred to as "Dunan Environment")
held by Zhejiang Dunan Precision Machinery Group Co., Ltd. (hereinafter referred to as "Dunan Precision")
(hereinafter referred to as "Transfer of Shares " ). The price of the transfer is approximately 2.19 billion yuan. At the
same time, the Company intends to subscribe for 139,414,802 shares of Dunan Environment's non-public offering to
certain parties in cash (collectively as "Transaction") for a subscription price of approximately RMB810 million
(hereinafter referred to as the "Non-Public Offering"). Dunan Environment will be a controlling subsidiary of the
company after this transfer of shares. Upon completion of the transaction, Gree Electric Appliances will hold
409,774,802 shares of Dunan Environment, representing 38.78% of the total share capital of Shield Environment
after the issuance.
Up to the date of this report, Dunan Environment has provided a related guarantee for Dunan Holdings. On
305
March 31, 2022, as considered and approved at the second meeting of the twelfth session of the Board of Directors of
the Company, Gree Electric Appliances signed a "Special Agreement on Settlement of Related Guarantees" with
Dunan Precision, Dunan Holdings and Hangzhou Branch of Zhejiang Commercial Bank Co., Ltd. and reached the
following arrangements in respect of the related guarantees:
(1) Dunan Holdings and Gree Electric Appliances shall each bear 50% of the related guaranteed debts as of the
maturity date of the financing (loan), and any additional debts (if any) arising from the related guaranteed debts from
the maturity date of the financing (loan), including but not limited to interest and penalty interest, shall be settled by
Dunan Holdings itself.
(2) All parties should do their best to ensure that the related guarantee debts should be repaid no later than May
15, 2022, and the guarantee obligations borne by Dunan Environment shall be released.
306
2. Distribution of profits
According to the resolution at the third meeting of the twelfth session of the board of directors, the Company's
profit distribution plan of 2021: Temporarily based on the total 5,536,677,733 shares entitled to profit distribution
rights on April 29, 2022 (namely the total stock capital of the Company equivalent to 5,914,469,040 shares minus
377,791,307 shares held by the Company's repurchase account), all shareholders will be distributed a cash of RMB
20 (tax included) per 10 shares, with the total amount of cash dividends to be distributed in such a way up to RMB
11,073,355,466.00. This distribution plan still needs to be approved by the general meeting of shareholders.
3. Sales return
No important sales return occurred after the balance sheet date.
4. Other events after the balance sheet date
No.
ⅫⅠ Other important events
1. Correction of early errors in accounting
No.
2. Debt restructuring
No.
3. Asset replacement
(1) Exchange of non-monetary assets
No.
(2) Replacement of other assets
No.
4. Pension plan
No.
5. Discontinued operation
Profit from
discontinued
Income tax operation
Item Revenue Expense Total profits Net profit
expenses attributable to
owners of
parent company
Gree (USA) Sales Co.,
211,825.22 -211,825.22 -210,134.79 -1,690.43 -1,690.43
Ltd.
(Continued)
307
Net cash flows from Net cash flows from Net cash flows from financing
Item
operating activities investment activities activities
Gree (USA) Sales Co., Ltd. -1,690.43
6. Other important transactions and events affecting investor decisions
(1) Share repurchase
The Company held the tenth and sixteenth meetings of the eleventh session of board of directors on April 10,
2020 and October 13, 2020, respectively, which deliberated and approved the Proposal on the Partial Repurchase of
Public Shares and agreed to the Company's use of self-owned funds to repurchase the Company's A shares by means
of centralized bidding transactions (hereinafter referred to as "Phase-1 Repurchase" and "Phase-2 Repurchase"), and
the total amount of repurchase funds of each phase shall not be lower than RMB 3 billion (inclusive) and shall not
exceed RMB 6 billion (inclusive); The Company held the twenty-first meetings of the eleventh session of board of
directors on May 26, 2021, which deliberated and approved the Proposal on the Partial Repurchase of Public Shares
and agreed to the Company's use of self-owned funds to repurchase the Company's A shares by means of centralized
bidding transactions (hereinafter referred to as "Phase-3 Repurchase"), and the total amount of repurchase funds of
each phase shall not be lower than RMB 7.5 billion (inclusive) and shall not exceed RMB 15 billion (inclusive).
As of February 24, 2021, the phase-1 repurchase plan of the Company had been implemented. The Company
accumulatively bought 108,365,753 shares of the Company by means of centralized bidding transactions through the
special security repurchase account. The highest transaction price was RMB 60.18/share, the lowest transaction price
was RMB 53.01/share, and the total transaction amount was RMB 5,999,591,034.74 (excluding transaction costs).
On June 27, 2021, the twenty-third meeting of the eleventh Board of Directors and the seventeenth Meeting of
the eleventh Supervisory Board approved the Proposal on the Change of Use of Repurchased Shares and
Cancellation. It is proposed to adjust the Proposal on the Repurchase of Part of the Public Shares (hereinafter
referred to as "the second phase of the repurchase") adopted at the 16th meeting of the 11th Board of Directors on
October 13, 2020: "The repurchased shares will be used for employee stock ownership plan or equity incentive" was
changed to "Repurchased shares will be used for cancellation to reduce registered capital". The Company repurchased
a total of 101,261,838 shares in the second phase, and this resolution is subject to the approval of the shareholders'
meeting.
(2) Issuance of ultra-short-term financing bills
The Company's first interim general meeting of shareholders in 2020 considered and approved the Proposal on
Debt Financing Instruments to be Registered and Issued, and agreed that the Company registers debt financing
instruments with a total amount not exceeding RMB 18 billion (inclusive), of which the ultra-short-term financing
bonds to be registered did not exceed RMB 10 billion (inclusive), the short-term financing bonds to be registered did
not exceed RMB 3 billion (inclusive), and the medium-term notes to be registered did not exceed RMB 5 billion
(inclusive).
The China Interbank Market Dealers Association held the 37th registration meeting on April 7, 2020, and agreed
to accept the registration of the Company's ultra-short-term financing bonds, short-term financing bonds and
medium-term bills, and issued the Registration Acceptance Notice for them respectively.
308
According to the Company's capital plan arrangement and the interbank market situation, during January 21 -
July 7, 2021, the Company issued the first-ninth phases of ultra-short-term financing bonds for 2021, and the total
actual issuance amount was RMB 25 billion. The first-ninth phases of ultra-short-term financing bills were cashed on
February 26, April 9, June 26, July 6, June 2, August 5, October 7, October 9, 2021 and January 6, 2022 respectively.
(3) Company Guarantee
As of December 31, 2021, the total amount of guarantees provided by the company's holding subsidiary, GREE
Altairnano New Energy, was RMB 7,602,673,700, of which the total amount of guarantees provided by GREE
Altairnano New Energy's subsidiaries for short-term loans, long-term loans, accounts payable (EICT), bank
acceptance bills issued, long-term payables and other funds was RMB 4,296,357,600; the total amount of guarantees
provided to companies outside the consolidated statements The total amount of guarantees provided to companies
outside the consolidated statements was RMB 3,306,316,100 (representing the stock guarantees provided by GREE
Altairnano New Energy for its bus company and other clients' finance lease purchase business).
(4) Financial support
GREE Altairnano New Energy Inc., the subsidiary of the Company, provided financial loans of RMB 94,200,
RMB 681,400, RMB 23,019,800 and RMB 17,200 respectively to the original shareholder and its related parties Wei
Yincang, Sun Guohua, Zhuhai Yinlong Investment Holding Group Co. As of the date of this report, the
above-mentioned borrowings have not been recovered.
XIV Notes to main items of financial statements of the parent company
1. Accounts receivable
(1) Receivables are disclosed by account age
Account age Balance at the end of the period
Within 1 year 3,786,981,476.31
1 ~ 2 years 54,216,014.16
2 to 3 years 15,247,206.47
Over 3 years 15,902,264.48
Subtotal 3,872,346,961.42
Less: Bad debt provisions 186,727,012.13
Total 3,685,619,949.29
(2) Disclosure of accounts receivable classification
Balance at the end of the period
Category Book balance Bad debt provision
Book value
Percentage Credit loss rate
Amount Amount
(%) (%)
309
Balance at the end of the period
Category Book balance Bad debt provision
Book value
Percentage Credit loss rate
Amount Amount
(%) (%)
Accounts receivable with bad debt
4,715,115.32 0.12 4,715,115.32 100.00
provisions accrued separately
Accounts receivable with bad debt
provisions accrued according to the 3,867,631,846.10 99.88 182,011,896.81 4.71 3,685,619,949.29
combination
Including: account age
3,127,809,201.36 80.77 182,011,896.81 5.82 2,945,797,304.55
combination
Risk-free combination 739,822,644.74 19.11 739,822,644.74
Total 3,872,346,961.42 100.00 186,727,012.13 4.82 3,685,619,949.29
(Continued)
310
Beginning balance
Category Book balance Bad debt provision
Book value
Percentage Credit loss rate
Amount Amount
(%) (%)
Accounts receivable with bad debt
4,715,115.32 0.12 4,715,115.32 100.00
provisions accrued separately
Accounts receivable with bad debt
provisions accrued according to the 3,779,130,839.10 99.88 230,339,143.83 6.10 3,548,791,695.27
combination
Including: account age
3,019,555,812.57 79.81 230,339,143.83 7.63 2,789,216,668.74
combination
Risk-free
759,575,026.53 20.07 759,575,026.53
combination
Total 3,783,845,954.42 100.00 235,054,259.15 6.21 3,548,791,695.27
1) Accounts receivable for which bad debt reserves are accrued individually:
Balance at the end of the period
Name
Book balance Bad debt provision Credit loss rate (%) Reason for appropriation
It is expected to be difficult
Unit 1 4,715,115.32 4,715,115.32 100.00
to recover in full
Total 4,715,115.32 4,715,115.32 100.00
2) In the combination, the accounts receivable with bad debt provisions accrued by account age combination:
Account age Book balance Bad debt provision Credit loss rate (%)
Within 1 year 3,047,158,831.57 152,357,941.57 5.00
1 ~ 2 years 54,216,014.16 10,843,202.84 20.00
2 to 3 years 15,247,206.47 7,623,603.24 50.00
Over 3 years 11,187,149.16 11,187,149.16 100.00
Total 3,127,809,201.36 182,011,896.81 5.82
(3) Provision for bad debt accrued, recovered or reversed in the current period
Balance at the end of the
Category Beginning balance Recovery or reversal in the current period
period
Single accrual 4,715,115.32 4,715,115.32
Account age
230,339,143.83 48,327,247.02 182,011,896.81
combination
Total 235,054,259.15 48,327,247.02 186,727,012.13
[Note] There was no significant recovery or reversal of bad debt provisions during the current period.
(4) Accounts receivable actually written off in current period:
No.
(5) Accounts receivable of top 5 debtors in the balance at the end of the period collected by the debtor
311
Balance of provision for
Balance at the end of the period of Percentage (%) in the total balance at the
Name of entity bad debts at the end of the
accounts receivable end of the period of accounts receivable
period
First 1,099,224,286.67 28.39 54,961,214.15
Second 669,717,406.78 17.29
Third 322,068,295.62 8.32 16,103,414.78
Fourth 281,752,770.21 7.28 14,087,638.51
Fifth 138,438,223.70 3.58 6,921,911.19
Total 2,511,200,982.98 64.86 92,074,178.63
(6) Accounts receivable derecognized due to the transfer of financial assets
No.
(7) Assets and liabilities formed due to the transfer and continuous involvement of accounts receivable
No.
2. Other receivables
Item Balance at the end of the period Beginning balance
Dividends receivable 2,932,373.42
Other receivables [Note 1] 2,076,879,180.43 2,304,222,611.24
Total 2,076,879,180.43 2,307,154,984.66
[Note 1] Other receivables in the table above refer to other receivables after deduction of interest receivables and
dividends receivable;
[Note 2] The Company has no interest receivable balance at the end and the beginning of the period.
(1) Dividends receivable
1) Classification of dividends receivable
Item Balance at the end of the period Beginning balance
Dividends receivable 2,932,373.42
Total 2,932,373.42
2) Significant dividends receivable aged over 1 year
No.
(2) Other receivables
1) Other receivables classified by nature
Nature of money Ending book balance Beginning book balance
Current and free-risk payments 2,083,804,977.50 2,310,790,456.35
312
Nature of money Ending book balance Beginning book balance
Less: Bad debt provisions 6,925,797.07 6,567,845.11
Total 2,076,879,180.43 2,304,222,611.24
2) Accrual of bad debt reserves
Phase I Phase 2 Phase 3
Bad debt provision The entire duration The entire duration Total
Next 12 months
Expected credit losses Expected credit losses
Expected credit losses
(no credit impairment) (credit impairment occurred)
Balance as at January 1,
4,173,300.51 2,394,544.60 6,567,845.11
2021
Appropriation for the
2,612,830.06 2,612,830.06
current period
Reserved in the current
2,218,485.72 2,218,485.72
period
Wrote-off in the current
36,392.38 36,392.38
period
Balance on December 31,
1,918,422.41 5,007,374.66 6,925,797.07
2021
3) Disclosure by aging
Account age Book balance
Within 1 year 2,064,254,626.85
1 ~ 2 years 18,140,539.35
2 to 3 years 61,089.01
Over 3 years 1,348,722.29
Subtotal 2,083,804,977.50
Less: Bad debt provisions 6,925,797.07
Total 2,076,879,180.43
4) Bad debt reserves accrued, recovered or reversed in the current period
Change of the current period Balance at the
Category Beginning balance end of the
Appropriation Recovered or reversed Wrote-off period
Account
age 6,567,845.11 2,612,830.06 2,218,485.72 36,392.38 6,925,797.07
combination
Total 6,567,845.11 2,612,830.06 2,218,485.72 36,392.38 6,925,797.07
5) Other receivables actually wrote off in the current period
Item Wrote-off amount
Unit 1 36,392.38
[Note] There was no significant writing-off of other receivables during the current period.
313
6) Other receivables of top 5 debtors in the balance at the end of the period collected by the debtor
Balance of
Proportion in total closing provision for
Balance at the end of
Name of entity Nature of money Account age balance of other receivables bad debts at
the period
(%) the end of the
period
First Risk-free fund 1,250,437,686.09 Within 1 year 60.01
Second Risk-free fund 255,969,551.84 Within 1 year 12.28
Third Risk-free fund 185,641,672.21 Within 1 year 8.91
Fourth Risk-free fund 173,610,000.00 Within 1 year 8.33
Fifth Risk-free fund 104,136,437.19 Within 1 year 5.00
Total 1,969,795,347.33 94.53
7) Receivables involving government subsidies
No.
8) Other receivables derecognized due to the transfer of financial assets
No.
9) Assets and liabilities formed due to the transfer and continuous involvement of other receivables
No.
314
3. Long-term equity investments
Balance at the end of the period Beginning balance
Item
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Investments to subsidiaries 20,871,011,854.66 20,871,011,854.66 17,421,936,741.10 17,421,936,741.10
Investments to associated enterprises
9,019,517,140.98 1,940,009.35 9,017,577,131.63 7,199,360,635.26 1,940,009.35 7,197,420,625.91
and joint ventures
Total 29,890,528,995.64 1,940,009.35 29,888,588,986.29 24,621,297,376.36 1,940,009.35 24,619,357,367.01
(1) Investments to subsidiaries
Increase/Decrease in the current period
Ending balance of
Beginning balance Ending balance (book
Name of invested entities Accrual of provision for
(book value) Additional Decreased value)
provision for Others impairment
Investment Investment
impairment
Gree (Brazil) Electric Appliances Co., Ltd. 659,342,914.36 659,342,914.36
Gree (Chongqing) Electric Appliances Co., Ltd. 223,100,000.00 223,100,000.00
GREE Shanghai Air Conditioners Sales Co., Ltd. 1,800,000.00 1,800,000.00
Zhuhai Gree Group Finance Company Limited 4,040,371,239.99 4,040,371,239.99
Zhuhai Gree Electrical Co., Ltd. 1,684,680,359.95 1,684,680,359.95
Zhuhai Landa Compressor Co., Ltd. 968,225,519.93 968,225,519.93
Zhuhai Gree Xinyuan Electronics Co., Ltd. 154,290,096.61 154,290,096.61
Zhuhai Gree TOSOT Home Appliances Co., Ltd. 30,000,000.00 30,000,000.00
Zhuhai Kaibang Motor Manufacturing Co., Ltd. 83,860,929.67 83,860,929.67
Gree (Hefei) Electric Appliances Co., Ltd. 505,370,626.10 505,370,626.10
315
Increase/Decrease in the current period
Ending balance of
Beginning balance Ending balance (book
Name of invested entities Accrual of provision for
(book value) Additional Decreased value)
provision for Others impairment
Investment Investment
impairment
Gree Hong Kong Electric Appliances Sales Co.,
472,879.08 472,879.08
Ltd.
Zhuhai Gree Dakin Device Co., Ltd. 283,117,574.47 283,117,574.47
Zhuhai Gree Daikin Precision Mold Co., Ltd. 201,911,186.86 201,911,186.86
Gree (ZhongShan) Small Home Appliances Co., Ltd 30,000,000.00 30,000,000.00
Gree (Zhuhai) Green Refrigeration Technology
676,040,000.00 676,040,000.00
Center Co., Ltd.
Zhuhai HVAC Equipment Co., Ltd. 100,000,000.00 100,000,000.00
Fortune Electric (Wuhan) Co., Ltd. 600,000,000.00 600,000,000.00
Gree (Zhengzhou) Electric Appliances Co., Ltd. 720,000,000.00 720,000,000.00
Gree Green Renewable Resources (Zhengzhou)
5,000,000.00 5,000,000.00
Co., Ltd.
Hunan Green Renewable Resources Co., Ltd. 5,000,000.00 5,000,000.00
Wuhu Green Renewable Resources Co., Ltd. 2,000,000.00 2,000,000.00
Gree (Shijiazhuang) Small Home Appliances Co.,
10,000,000.00 10,000,000.00
Ltd.
Gree (Wuhu) Electric Appliances Co., Ltd. 20,000,000.00 20,000,000.00
Shijiazhuang Green Renewable Resources Co.,
5,000,000.00 5,000,000.00
Ltd.
Gree (Shijiazhuang) Electric Appliances Co., Ltd. 98,940,059.97 98,940,059.97
Tianjin Green Renewable Resources Co., Ltd. 5,000,000.00 5,000,000.00
Zhuhai Ligao Precision Manufacturing Co., Ltd. 30,000,000.00 30,000,000.00
Changsha Gree HVAC Equipment Co., Ltd. 50,000,000.00 50,000,000.00
316
Increase/Decrease in the current period
Ending balance of
Beginning balance Ending balance (book
Name of invested entities Accrual of provision for
(book value) Additional Decreased value)
provision for Others impairment
Investment Investment
impairment
Zhuhai IVP Information Technology Co., Ltd. 100,000,000.00 100,000,000.00
Gree TOSOT (Suqian) Home Appliances Co., Ltd. 140,000,000.00 140,000,000.00
Wuhu Green Precision Manufacturing Co., Ltd. 30,000,000.00 30,000,000.00
Zhuhai Gree New Material Co., Ltd. 30,000,000.00 30,000,000.00
Zhuhai GREE Intelligent Equipment Co., Ltd. 100,000,000.00 100,000,000.00
Zhuhai Hengqin GREE Business Factoring Co.,
100,000,000.00 100,000,000.00
Ltd.
Zhuhai Gree Precision Mold Co., Ltd. 100,000,000.00 100,000,000.00
Gree (Wuhan) Precision Mold Co., Ltd. 80,000,000.00 20,000,000.00 100,000,000.00
Zhuhai GREE Intelligent Equipment Technology
50,000,000.00 50,000,000.00
Research Institute Co., Ltd.
Zhuhai Gree Energy Environment Technology Co.,
200,000,000.00 200,000,000.00
Ltd.
Gree (Wuhan) HVAC Equipment Co., Ltd. 40,000,000.00 60,000,000.00 100,000,000.00
Gree (Hangzhou) Electric Appliances Co., Ltd. 550,000,000.00 550,000,000.00
Zhuhai Gree Info Technology Co., Ltd. 510,000.00 510,000.00
Gree (Wu'an) Precision Equipment Manufacturing
210,000,000.00 210,000,000.00
Co., Ltd.
Zhuhai Gree Transportation Co., Ltd. 50,000,000.00 50,000,000.00
Gree (Luoyang) Electric Appliances Co., Ltd. 50,000,000.00 50,000,000.00
Gree (Nanjing) Electric Appliances Co., Ltd. 504,000,000.00 196,000,000.00 700,000,000.00
Zhuhai Gree Material Supply Co., Ltd. 150,000,000.00 150,000,000.00
317
Increase/Decrease in the current period
Ending balance of
Beginning balance Ending balance (book
Name of invested entities Accrual of provision for
(book value) Additional Decreased value)
provision for Others impairment
Investment Investment
impairment
Gree (Chengdu) Electric Appliances Co., Ltd. 400,000,000.00 400,000,000.00
Hefei Kinghome Electrics Co., Ltd. 1,247,087,108.76 1,247,087,108.76
Zhuhai Zero Boundary Integrated Circuit Co., Ltd. 50,000,000.00 50,000,000.00
Zhuhai Lianyun Technology Co., Ltd. 40,000,000.00 40,000,000.00
Zhuhai Gree Electormechanical Engineering Co.,
149,092,300.30 149,092,300.30
Ltd
Zhuhai Green Renewable Resources Co., Ltd 50,000,000.00 50,000,000.00
Zhuhai Gree Lvkong Technology Co., Ltd. 270,000,000.00 270,000,000.00
Gree (Luoyang) Washing Machine Co., Ltd. 50,000,000.00 50,000,000.00
Guochuang Energy Internet Innovation Center
22,500,000.00 22,500,000.00
(Guangdong) Co., Ltd.
Gree (Anji) Precision Mold Co., Ltd. 60,000,000.00 18,800,000.00 78,800,000.00
Songyuan Grain Group Co., Ltd. 230,223,945.05 230,223,945.05
Gree Electric (Zhuhai Gaolan Port) Co., Ltd. 1,000,000,000.00 1,000,000,000.00
Zhuhai Gejian Medical Technology Co., Ltd. 20,000,000.00 20,000,000.00
Chengdu Gree Xinhui Medical Equipment Co.,
75,000,000.00 75,000,000.00
Ltd.
Gree (Ganzhou) Electric Appliances Co., Ltd. 80,000,000.00 20,000,000.00 100,000,000.00
Gree E-commerce Co., Ltd. 100,000,000.00 100,000,000.00
Changsha Kinghome Electrics Co., Ltd. 6,000,000.00 6,000,000.00
Gree Electric (Linyi) Co., Ltd. 200,000,000.00 200,000,000.00
318
Increase/Decrease in the current period
Ending balance of
Beginning balance Ending balance (book
Name of invested entities Accrual of provision for
(book value) Additional Decreased value)
provision for Others impairment
Investment Investment
impairment
Gree Altairnano New Energy Inc. 1,828,275,113.56 1,828,275,113.56
Gree (Zhuhai Hengqin) GREE Development Co.,
1,000,000,000.00 1,000,000,000.00
Ltd.
Total 17,421,936,741.10 3,449,075,113.56 20,871,011,854.66
(2) Investments to associated enterprises and joint ventures
Beginning balance Increase/Decrease in the current period Balance at the end of the period
Declaration
Profit and
Adjustment of and
Name of invested entities losses on Other
Provision for Increase/decrease Other distribution Other Provision for
Original value investment equity Original value
impairment investment Comprehensive of cash deductions impairment
recognized by changes
Incomes dividends or
equity method
profits
I. Associated enterprises
Gree (Vietnam) Electric
1,940,009.35 1,940,009.35 1,940,009.35 1,940,009.35
Appliances, Inc.
Liaowang All Media
36,052,960.09 1,332,591.91 37,385,552.00
Communication Co., Ltd.
Beijing Gree Technology
2,294,251.09 -237,069.32 2,057,181.77
Co., Ltd.
Chongqing Pargo
Mechanical Equipment 11,249,230.03 -13,498,800.00 2,249,569.97
Co., Ltd.
Wuhan Digital Design and
Manufacturing Innovation 14,729,087.92 212,951.68 14,942,039.60
Center Co., Ltd.
Hunan Guoxin
Semiconductor Technology 20,099,845.47 13,817.45 108,922.33 20,004,740.59
Co., Ltd.
319
Beginning balance Increase/Decrease in the current period Balance at the end of the period
Declaration
Profit and
Adjustment of and
Name of invested entities losses on Other
Provision for Increase/decrease Other distribution Other Provision for
Original value investment equity Original value
impairment investment Comprehensive of cash deductions impairment
recognized by changes
Incomes dividends or
equity method
profits
Zhuhai Ronglin Equity
Investment Partnership 7,061,709,059.56 -18,046,764.90 1,849,833,156.32 8,893,495,450.98
(Limited Partnership)
Henan Yuze Finance
51,286,191.75 1,569,732.71 1,106,576.00 51,749,348.46
Leasing Co., Ltd.
Total 7,199,360,635.26 1,940,009.35 -13,498,800.00 -12,905,170.50 1,849,833,156.32 3,272,680.10 9,019,517,140.98 1,940,009.35
320
4. Operating revenues and operating costs
Amount for the current period Amount for the previous period
Item
Revenue Cost Revenue Cost
Main business 111,783,657,570.87 79,364,424,299.73 101,918,116,676.30 70,442,870,159.78
Other business 5,718,557,388.28 5,212,016,098.84 5,923,673,498.19 5,565,482,185.50
Total 117,502,214,959.15 84,576,440,398.57 107,841,790,174.49 76,008,352,345.28
5. Income from investment
Amount for the current Amount for the previous
Item
period period
Long-term equity investment income calculated by the equity method -12,905,170.50 -12,168,894.57
Investment income from conforming of trading financial assets 35,444,353.04 213,050,762.46
Dividend shares confirmed in long-term equity investment audited by cost
2,526,350,566.25 12,177,372,543.12
method
Others 411,276,921.75 24,372,625.28
Total 2,960,166,670.54 12,402,627,036.29
ⅩⅤ Supplementary information
1. Detailed list of non-recurring profit and loss
Item Amount Description
For details, see Note (V) 63,
Gains from disposal of non-current assets -7,498,891.48 Note (V) 64, and Note (V)
65
Government subsidies included in the current profit and loss (closely related
For details, see Note (V) 58
to the business of the enterprise, except the government subsidies entitled 875,778,734.20
and Note (V) 64
according to the unified national standard quota or quantity)
Capital occupation fee collected from the non-financial institution and
6,234,097.19
recorded into the current gains and losses
In addition to the effective hedging business related to the Company's normal
business operations, the gains and losses from fair value changes generated by
holding trading financial assets, derivative financial assets, trading financial
liabilities and derivative financial liabilities, and investment incomes obtained 369,460,356.97
from the disposal of trading financial assets, derivative financial assets,
trading financial liabilities, derivative financial liabilities and other debt
investment
Reversal of impairment provision for the accounts receivable for which an
16,844,984.00
independent impairment test is conducted
For details, see Note (V) 64
Non-operating incomes and expenditures other than the above items 58,510,843.19
and Note (V) 65
Other profit and loss items that conform to the definition of non-recurring
13,691,263.12
profit and loss
Subtotal 1,333,021,387.19
Less: Influence amount of income tax 82,923,289.84
Affected amount of minority shareholders' equity 36,416,620.04
321
Item Amount Description
Total 1,213,681,477.31 --
322
2. Rate of return on net assets and earnings per share
Earnings per share
Weighted
Diluted earnings per
Profit in the reporting period average return Basic earnings per share
share
on net assets (RMB/share)
(RMB/share)
Net profit attributable to shareholders of the parent
21.34% 4.04 4.04
company
Net profit attributable to common shareholders after
20.21% 3.82 3.82
deducting non-recurring profits and losses
GREE ELECTRIC APPLIANCES, INC. OF ZHUHAI
April 30, 2022
323
