Full Text of 2023 Semi-annual Report FAW JIEFANG GROUP CO., LTD.
FAW JIEFANG GROUP CO., LTD.
Semi-annual Report 2023
August 2023
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Full Text of 2023 Semi-annual Report FAW JIEFANG GROUP CO., LTD.
Section I Important Notes, Contents and Definitions
The Board of Directors and Board of Supervisors, as well as directors,
supervisors and senior executives of the Company guarantee that the contents
of the semi-annual report are true, accurate and complete, there is no false
record, misleading statement or major omission, and shall bear individual and
joint legal responsibilities.
Hu Hanjie, the person in charge of the Company, Ji Yizhi, the person in
charge of accounting, and Si Yuzhuo, the person in charge of the accounting
organization (chief accountant) declare that they guarantee the authenticity,
accuracy and completeness of the financial report in this semi-annual report.
Except for the following directors, others attended the board meeting to
review the semi-annual report in person
Names of Positions of
Reasons for not Name of the
Directors not Directors not
Present in Person Trustee
Present in Person Present in Person
Bi Wenquan Director Work Liu Yanchang
Independent
Han Fangming Work Mao Zhihong
director
This semi-annual report involves prospective statements such as future
plans, and does not constitute a substantial commitment of the Company to
investors. Investors and relevant individuals should maintain sufficient risk
awareness and understand the differences between plans, forecasts, and
commitments.
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The Company has described in detail the possible risks and
countermeasures for its future development in the section of Management
Discussion and Analysis. Investors are kindly requested to pay attention to
relevant contents. China Securities Journal, Securities Times and CNINFO
(http://www.cninfo.com.cn) are the information disclosure media selected by
the Company. All information of the Company is subject to that published in
the above selected media. Investors are kindly requested to pay attention to
investment risks.
The Company does not plan to pay cash dividends or bonus shares, or
convert reserves into share capital.
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Table of Contents
Section I Important Notes, Contents and Definitions ..................................... 2
SectionIICompany Profile and Main Financial Indicators ..................................... 7
Section III Management Discussion and Analysis ............................................ 11
Section IV Corporate Governance ..................................................................... 29
Section V Environmental and Social Responsibilities .................................... 33
Section VI Important Matters ............................................................................ 45
Section VII Changes in Shares and Shareholders .............................................. 56
Section VIII Preferred Shares................................................................................ 66
Section IX Bonds .................................................................................................. 67
Section X Financial Report................................................................................ 68
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List of Documents for Future Reference
(I) Financial statements were signed and sealed by the person in charge of the
Company, the person in charge of accounting and the person in charge of the
accounting organization (chief accountant).
(II) Originals of all company documents and announcements publicly disclosed on
the website designated by China Securities Regulatory Commission in the reporting
period.
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Interpretation
Item Refers to Definition
Company, the Company, FAW Jiefang Refers to FAW JIEFANG GROUP CO., LTD.
Jiefang Limited Refers to FAW Jiefang Automotive Co., Ltd.
FAW, FAW Group Refers to CHINA FAW GROUP CO., LTD.
FAW Refers to China FAW Co., Ltd.
FAW Car Refers to FAW Car Co., Ltd.
FAW Bestune Refers to FAW Bestune Car Co., Ltd.
Finance company Refers to First Automobile Finance Co., Ltd.
Board of Directors Refers to Board of Directors of FAW JIEFANG GROUP CO., LTD.
Shareholders’ Meeting of FAW JIEFANG GROUP CO.,
Shareholders’ meeting Refers to
LTD.
Board of Supervisors Refers to Board of Supervisors of FAW JIEFANG GROUP CO., LTD.
State-owned Assets Supervision and Administration
SASAC Refers to
Commission of the State Council
CSRC Refers to China Securities Regulatory Commission
China Securities Depository and Shenzhen Branch, China Securities Depository and Clearing
Refers to
Clearing Corporation Limited (CSDC) Corporation Limited
Company Law Refers to Company Law of the People’s Republic of China
Securities Law Refers to Securities Law of the People's Republic of China
Articles of Association of FAW JIEFANG GROUP CO.,
Articles of Association Refers to
LTD.
Reporting Period Refers to January 1, 2023 - June 30, 2023
CNY, CNY 10,000, CNY 100 million Refers to CNY, CNY 10,000, CNY 100 million
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Section II Company Profile and Main Financial Indicators
I. Company Profile
Stock abbreviation FAW Jiefang Stock code 000800
Stock exchanges on which shares are
Shenzhen Stock Exchange
listed
Chinese name of the Company FAW JIEFANG GROUP CO., LTD.
Chinese abbreviation of the Company FAW Jiefang
English name of the Company FAW JIEFANG GROUP CO.,LTD
English abbreviation of the Company FAW Jiefang
Legal representative of the Company Hu Hanjie
II. Contact Person and Contact Information
Secretary of the Board of Directors Securities Affairs Representative
Name Wang Jianxun Yang Yuxin
No. 2259, Dongfeng Street, Changchun
No. 2259, Dongfeng Street, Changchun
Address Automobile Development Zone, Jilin
Automobile Development Zone, Jilin Province
Province
Tel. 0431-80918881 0431-80918882 0431-80918881 0431-80918882
Fax 0431-80918883 0431-80918883
E-mail faw0800@fawjiefang.com.cn faw0800@fawjiefang.com.cn
III. Other Information
1. Company Contact Information
Whether the registered address, office address and postal code, website and e-mail address of the
Company have changed in the reporting period
□ Applicable Not applicable
The registered address, office address and postal code, website and e-mail address of the
Company have not changed in the reporting period, please refer to the Annual Report 2022 for
details.
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2. Information Disclosure and Preparation Location
Whether the information disclosure and preparation location have changed in the reporting period
□ Applicable Not applicable
There are no changes in the name and website of the stock exchange and media where the
Company discloses its semi-annual report, as well as the preparation location of the Company's
semi-annual report during the reporting period. For details, please refer to the 2022 Annual Report.
3. Other Relevant Data
Whether other relevant data has changed in the reporting period
□ Applicable Not applicable
IV. Main Accounting Data and Financial Indicators
Whether the Company needs to retroactively adjust or restate the accounting data of previous
years
□ Yes No
Increase/Decrease in
This Reporting Same Period of Last This Reporting Period
Period Year over the Same Period of
Last Year
Operating income (CNY) 33,014,661,914.13 22,871,535,261.56 44.35%
Net profit attributable to shareholders of
401,336,302.35 170,153,887.32 135.87%
the listed company (CNY)
Net profit attributable to shareholders of
the listed company after deducting non- 151,966,331.79 -106,246,804.18 243.03%
recurring profits and losses (CNY)
Net cash flows from operating activities
6,714,159,377.47 1,443,137,726.63 365.25%
(CNY)
Basic earnings per share (CNY/share) 0.0872 0.0366 138.25%
Diluted earnings per share (CNY/share) 0.0872 0.0366 138.25%
Weighted average return on equity 1.68% 0.65% Increased by 1.03%
Increase/Decrease at the
At the End of This At the End of Last End of This Reporting
Reporting Period Year Period over the End of
Last Year
Total assets (CNY) 72,001,981,826.53 56,772,860,616.12 26.82%
Net assets attributable to shareholders of
24,127,040,019.35 23,719,427,082.48 1.72%
the listed company (CNY)
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V. Differences in Accounting Data under Domestic and Foreign Accounting Standards
1. Differences in net profits and net assets in the financial report disclosed simultaneously
according to the international accounting standards and China accounting standards
□ Applicable Not applicable
In the reporting period of the Company, there is no difference in net profits and net assets in the
financial report disclosed according to the international accounting standards and China
accounting standards.
2. Differences in net profits and net assets in the financial report disclosed simultaneously
according to foreign accounting standards and China accounting standards
□ Applicable Not applicable
In the reporting period of the Company, there is no difference in net profits and net assets in the
financial report disclosed according to foreign accounting standards and China accounting
standards.
VI. Items and Amounts of Non-recurring Profit and Loss
Applicable □ Not applicable
Unit: CNY
Item Amount Description
Profits or losses on disposal of non-current assets
It refers to the net profit on disposal
(including the write-off part of the impairment 98,132,494.11
of non-current assets.
provision of assets withdrawn)
Government subsidies included in the current profit and
loss (except those closely related to the Company
normal operations, conforming to the State policies and 193,604,585.44
regulations and enjoyed persistently in line with certain
standard quotas or quantities)
It mainly refers to the reversal of
Reversal of impairment provision for receivables
59,131.00 impairment provision for receivables
subject to separate impairment test
subject to separate impairment test.
Non-operating income and expenses other than the They mainly refer to the net non-
5,740,722.98
above items operating income and expenses
Less: amount affected by income tax 48,166,962.97
Total 249,369,970.56
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Specific conditions of other profit and loss items meeting the definition of non-recurring profit
and loss:
□ Applicable Not applicable
There are no specific conditions of profit and loss items meeting definition of non-recurring profit
and loss for the Company.
Explanation on defining the non-recurring profit and loss items listed in the Explanatory
Announcement No. 1 on Information Disclosure by Companies Issuing Securities Publicly - Non-
recurring Profit and Loss as recurring profit and loss items
□ Applicable Not applicable
The Company does not define the non-recurring profit and loss items listed in the Explanatory
Announcement No. 1 on Information Disclosure by Companies Issuing Securities Publicly - Non-
recurring Profit and Loss as recurring profit and loss items.
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Section III Management Discussion and Analysis
I. Main Businesses of the Company in the Reporting Period
(I) Main business
The Company is a commercial vehicle manufacturer integrating R&D, production, sales and
service. It produces heavy-duty, medium-duty and light-duty trucks, buses, as well as core
components such as engines, transmissions and axles, and has a complete manufacturing system
covering raw materials, core components, key large assemblies and vehicles. The products of the
Company are mainly used in market segments such as traction, cargo carrying, dumping, special
purposes, highway passenger transport, bus passenger transport, etc., and the Company also
provides standardized and customized commercial vehicle products. The Company is committed
to becoming a "China's first and world-class" provider of green and intelligent transportation
solutions, focusing on the main product lines and insisting on innovation-driven and reform-
driven, and leading the industry trend. Main business, products, and business model of the
Company are not changed significantly in the reporting period.
(II) Industry situation
In the first half of 2023, according to the statistics of the China Association of Automobile
Manufacturers, the production and sales of commercial vehicles reached 1,967,000 units and
1,971,000 units respectively, with a year-on-year increase of 16.9% and 15.8% respectively. The
market has recovered overall but to a limited extent. Consumption-related industries recovered
rapidly, and highway vehicles recovered relatively well. The growth rate of infrastructure
decreased, the real estate industry was in recession, and the overall demand for engineering
vehicles was sluggish. In addition, the overall excess capacity of the freight industry is still
obvious and is also the main reason for the current downturn in the commercial vehicle industry.
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(10,000 vehicles) Monthly Sales Volume of Commercial Vehicles
70
60
50
40
30
20
10
0
Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.
Year 2021 Year 2022 Year 2023
Data source: China Association of Automobile Manufacturers
(III) Operation
In the first half of 2023, the Company resolutely studied and implemented the spirit of the
20th National Congress of the Communist Party of China, continuously implemented the
instructions given by General Secretary Xi Jinping's important speech during his visit to FAW,
actively focused on the strategic deployment and annual requirements of the Company, closely
focused on key tasks, aimed at objectives of being at the forefront in the industry, and solidly and
effectively promoted various work. As of June 30, 2023, the total assets of the Company
amounted to CNY 72.002 billion, with a year-on-year increase of 26.82%, and the net assets
attributable to shareholders of listed companies were CNY 24.127 billion, with a year-on-year
increase of 1.72%; During the reporting period, the operating income was CNY 33.015 billion,
with a year-on-year increase of 44.35%.; The net profit attributable to the parent company was
CNY 401 million, with a year-on-year increase of 135.87%. A total of 131,500 vehicles were sold,
up 31.23% year on year, including 112,300 medium- and heavy-duty trucks, up 31.75% year on
year, and 18,400 light-duty vehicles, up 22.90% year on year. The sales volume of new energy
vehicles was 3,600, up 184.6% year-on-year, showing a leap. Overseas exports reached 27,100
units, up 130.0% year-on-year, hitting a record high with a high growth trend.
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Unit: CNY 100 million
In the first half of 2023, the Company was rated as a "World-class Professional, Refined,
Distinctive and Innovative Demonstration Enterprise" by the SASAC, and successfully selected
into the list of "China ESG (Corporate Social Responsibility) Listed Company Pioneers 100". The
Anting Innovation Index has ranked first in the industry for six consecutive years, and its brand
value has remained first in the industry for 12 consecutive years.
In the first half of 2023, the Company's key work is as follows:
1. Strategic leadership role played effectively. The insight, strategy and brand
management capabilities continued to improve, the strategic direction was further clarified, and
key topics were promoted in an orderly manner. Effective progress has been made in the
implementation of solutions. With the definition and connotation further clarified, a systematic
solution business and brand architecture have been formed.
2. Market-leading strategy as a guiding principle implemented effectively. Guided by
the goal of becoming a market leader, the Company has implemented the strategy of "Two Firsts
and Two Increments", strengthened the advantages and complemented the weaknesses, focused
on the balanced development of each market segment, effectively reshaped the marketing ability,
and achieved a substantial increase in overall sales volume. Leading in product development and
aiming at advantage building, the Company launched a batch of more competitive products,
providing stronger support for market development.
3. Fruitful innovation-driven results. The Company has made breakthroughs in more than
30 key core technologies, applied for more than 800 patents (including more than 600 invention
patents), and launched a number of technologies for the first time. The ammonia-hydrogen fusion
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direct injection zero-carbon internal combustion engine was successfully ignited in the world for
the first time, showing strong technological innovation strength. The revenue scale of the "four
major sectors" of business innovation has steadily expanded, and the trend of building a new
growth pole is improving.
4. Drive for reforms consolidated solidly. IPD and integrated reforms were promoted in
an orderly manner, with the depth and coverage of reforms continuously expanded; project-based
management was strengthened, and initial results in operation and management were achieved.
Adhering to the principle of strengthening the company with talent, the Company introduced 600
talents from various fields. Layered and categorized training empowerment, as well as the
implementation of incentive constraints such as performance-based agreements and competitive
bidding effectively motivates the enthusiasm of all employees.
5. Five major fields tackled orderly. Ultimate cost reduction and expense reduction have
been achieved, and steady improvement has been made in operational outcomes. The four-pillar
design of digital intelligence transformation has been further clarified and the dual-effect support
capability has been upgraded. The maturity of the quality system has been further improved in the
background of creating first-class quality competitiveness. Supply chain security has been
strengthened, and lean production has been implemented. The layout of manufacturing resources
has been optimized, the implementation of new bases in Guanghan and Foshan has been
accelerated, and intelligent manufacturing and process technology capabilities continue to
improve.
6. Business operations supported by capital operation. The Company actively planned
and carried out the issuance of A-shares to specific objects, with a proposed total fundraising
amount of CNY 3.713 billion to provide strong support for R&D and investment in the new four
modernization fields. It has completed the unlocking, listing, repurchase and cancellation of
shares related to more than 300 individuals in the equity incentive plan in a timely and compliant
manner; strengthened the management of 11 joint-stock enterprises, and achieved a total
investment income of CNY 233 million in the first half of the year; actively promoted equity
investment projects to provide strong support for the rapid implementation of strategies such as
new energy, Internet of Vehicles, autonomous driving and aftermarket.
In the second half of the year, the Company will unwaveringly adhere to and strengthen the
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leadership of the Communist Party, consistently implement the important instructions given by
General Secretary Xi Jinping during his visit to the Company, solidly promote the various tasks of
thematic education, firmly implement the Company's strategic deployment and the requirements
of the mid-year work conference. It will solidly work around the annual plan, focus on the key
stage, firmly adhere to the leading development, accelerate strategic transformation, inherit the
spirit of 70 years of struggle, promote the FAW Jiefang's culture of being at the forefront, enhance
a sense of urgency and crisis, as well as enthusiasm and proactiveness. It will strive to complete
all the tasks of party building and management for the year, compete vigorously, take on
responsibilities, and make every effort to lay a solid foundation for winning in the 14 th Five-Year
Plan.
II. Analysis of Core Competitiveness
The Company adheres to the corporate vision of "being the most proud commercial
vehicle enterprise and the most trustworthy commercial vehicle brand", the mission of "becoming
the China's first and world-class provider of green and intelligent transportation solutions and
building a more prosperous society"; takes products and services as the main task, customers and
employees as the foundation, innovation and reform as the driving force; focuses on industry
trends and customer needs, and rapidly enhances product competitiveness and service levels.
1. Product R&D: The Company has seven product series, namely tractors, load carriers,
dump trucks, special-purpose vehicles, new energy vehicles, light trucks and buses. The six
product platforms of FAW Jiefang J7, Yingtu, J6V, JH6, J6P and Hummer V cover four major
fields: heavy, medium and light trucks, and buses. The field of heavy trucks includes seven
product platforms: FAW Jiefang J7, Yingtu, JH6, J6V, J6P, JH5 and Han V. The field of medium
trucks includes FAW Jiefang J6G, J6L, JK6 and Long V product platforms. The field of light
trucks includes five product platforms: LINKTOUR, Tiger 6G, J6F, Tiger V and pure electric
mini-truck. The field of buses includes conventional road vehicles, new energy road vehicles, new
energy buses and off-road motor homes. Facing the future, FAW Jiefang is also accelerating the
overall layout of new energy and intelligent vehicles. In terms of new energy, it has launched J6P
pure electric dump trucks, JH6 pure electric tractors, J6L fuel cell carrier trucks, J6P hybrid
tractors and other new energy products to strive to create a clean and efficient portfolio of pure
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electric, hybrid and hydrogen fuel cell vehicles. In terms of intelligent vehicles, it has launched
mass-produced J6V_L2+ and J6V supertrucks for high-speed trunk line scenarios, and created a
number of L4 intelligent special products for ports, sanitation, border crossings and other
scenarios, leading the world. With its technological performance and excellent quality of "safety,
reliability, energy efficiency, comfort, and efficiency," Jiefang trucks have gained the trust of a
vast number of users and are praised as "money-making machines".
2. Technology R&D: It boasts the most powerful independent R&D system. Guided by
"leading technology, pioneering experience, integrated innovation, enhanced application,
collaboration and efficiency", the Company has built a strong and complete independent R&D
system in China from foresight technology, engine, transmission and axle to vehicle, and formed
an efficient and collaborative R&D team of nearly 3000 people. With the five core capabilities,
including scientific and technological innovation, lean design, performance development, trial
production verification and experimental verification, the Company has created five technical
platforms with low carbonization, informatization, intelligence, electrification and high quality,
and has become one of the commercial vehicle enterprises mastering the core technologies of
world-class vehicles and three power assemblies, and passed ISO9001, IATF16949 and GB9001B
quality system certifications. It is also a national-level independent automobile product R&D and
test certification base. In recent years, by accurately understanding the demand in segmented
markets, the Company has successfully developed ten core product technology advantages
including fuel efficiency, extended oil change intervals, lightweight design, independent major
components, autonomous electronic control, autonomous after-treatment, new energy, intelligent
driving, long-term durability, and maintenance-free features. These achievements have enabled
the Company to maintain a leading position in the highly competitive market.
3. Production and manufacturing: The Company has a complete manufacturing system
from raw materials to core components, from key assemblies to vehicles, and its processing and
manufacturing depth ranks among the industry leaders. The Company has five vehicle bases in
Changchun, Qingdao, Chengdu/Guanghan, Liuzhou and Foshan, three assembly bases in
Changchun, Wuxi and Dalian, and five new business companies, including FOR.J, SmartLink,
Zhito, Jiefang Shidai, and Diyi Yuansu. In 2022, FAW Jiefang J7 Intelligent Factory was selected
by the Ministry of Industry and Information Technology as a pilot and demonstration project for
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the development of big data industry.
4. Marketing and procurement: Adhering to the customer value orientation, the Company
has taken the lead in establishing a marketing service system with complete functions. The
marketing service network composed of more than 900 dealers, more than 1,000 service providers,
more than 60 spare parts centers and more than 100 spare parts dealers covers more than 260
prefecture-level cities in China, with a coverage rate of 99% in cities with a capacity of more than
1,000 vehicles. With a national average service radius of 48 kilometers, it is at the leading level in
the industry and provides users with 24-hour efficient and high-quality services. The Company is
committed to integrating global high-quality resources to provide a strong guarantee for the high
reliability of Jiefang trucks. In recent years, the Company has signed contracts with top
enterprises at home and abroad successively, including Huawei, Knorr-Bremse, ZF, Shell, VOSS,
China Unicom, JD and PlusAI, to become strategic partners and establish joint ventures with
them.
5. Overseas: The Company has actively accelerated the pace of internationalization and
expanded overseas markets. It exports its products to 80 countries and regions such as Southeast
Asia, Middle East, Latin America, Africa and Eastern Europe; it has nearly 80 first-tier dealers
and nearly 300 distributors in nearly 40 countries and regions around the world. Its export
products include J6, JH6, Tiger V and other models.
III. Analysis of Main Business
General
See relevant contents of "I. Main Businesses of the Company in the Reporting Period".
Year-on-year Changes of Main Financial Data
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Unit: CNY
Year-on-year
This Reporting Same Period of
Increase and Reason for Change
Period Last Year
Decrease
Mainly due to the increase
Operating income 33,014,661,914.13 22,871,535,261.56 44.35% in sales volume in the
current period.
Mainly due to the increase
Operating costs 30,590,523,778.02 21,115,050,469.61 44.88% in sales volume in the
current period.
Mainly due to the increase
Sales expenses 774,822,818.33 566,490,728.82 36.78% in sales volume in the
current period.
Administrative
871,161,062.92 887,020,116.52 -1.79%
expenses
Financial expenses -415,663,432.06 -571,153,971.08 -27.22%
Income tax Mainly due to the decrease
-203,065,319.73 -171,674.50 -118,185.08%
expenses in income tax.
R&D investment 1,248,047,703.54 1,016,316,222.64 22.80%
Mainly due to the increase
in cash received from sales
Net cash flows from
6,714,159,377.47 1,443,137,726.63 365.25% of goods and rendering of
operating activities
services in the current
period.
Net cash flows from Mainly due to an increase in
investment -961,691,276.91 -674,634,455.38 -42.55% cash paid on investments
activities during the period
Mainly due to the unpaid
Net cash flows from
-19,709,605.31 -3,041,097,420.19 99.35% cash dividends in the current
financing activities
period.
Mainly due to the increase
Net increase in cash in cash received from sales
and cash 5,732,768,748.83 -2,272,594,148.94 352.26% of goods and rendering of
equivalents services in the current
period.
Mainly due to the increase
Accounts receivable 2,834,227,703.58 867,090,338.42 226.87% in accounts receivable in the
current period.
Mainly due to the increase
Accounts receivable
8,679,460,881.09 3,461,653,473.66 150.73% in bank acceptance bills
financing
held at the end of the period.
Long-term deferred Mainly due to the decrease
expenses 42,793.98 130,439.66 -67.19% of long-term deferred
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expenses in the current
period.
Mainly due to the increase
Notes payable 9,198,593,038.03 79.23% in notes payable in the
16,487,079,559.64 current period.
Mainly due to the increase
Accounts payable 10,033,608,668.06 75.73% in accounts payable in the
17,632,426,555.29 current period.
Mainly due to the decrease
Advance receipts 785,227.42 1,861,865.37 -57.83% of rent received in advance
in the current period.
Mainly due to the increase
Employee
in employee compensation
compensation 608,021,510.57 436,648,178.76 39.25% payable in the current
payable
period.
Mainly due to the
repurchase and cancellation
Treasury shares 175,297,320.84 267,837,184.11 -34.55% of equity incentive shares in
the current period.
Mainly due to the decrease
of investment income
Investment income 133,617,879.87 203,908,916.41 -34.47% recognized in the current
period.
Mainly due to the increase
Credit impairment in impairment provision of
loss -35,480,726.08 -21,826,743.35 -62.56% receivables in the current
period.
Mainly due to the decrease
Asset impairment in impairment provision of
loss -35,324,171.95 -85,344,746.96 58.61% inventories in the current
period.
Mainly due to the increase
Income from assets
98,132,494.11 42,431.19 231174.43% in income from disposal of
disposal
assets in the current period.
Mainly due to the decrease
Non-operating
9,542,486.79 104,058,106.26 -90.83% in non-operating income in
income
the current period.
Mainly due to the decrease
Non-operating
3,801,763.81 12,214,234.59 -68.87% of donation expenditure in
expenses
the current period.
Net after-tax Mainly due to the increase
amount of other in other comprehensive
comprehensive 250,455.89 -44,893.81 657.89% income in the current
income period.
Significant changes in the Company's profit composition or source during the reporting period
□ Applicable Not applicable
No significant changes in the Company's profit composition or source during the reporting period.
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Composition of operating income
Unit: CNY
This Reporting Period Same Period of Last Year Year-on-
Proportion in Proportion in year
Amount Operating Amount Operating Increase and
Income Income Decrease
Total operating
33,014,661,914.13 100% 22,871,535,261.56 100% 44.35%
income
By industries
Automobile
33,014,661,914.13 100.00% 22,871,535,261.56 100.00% 44.35%
industry
By products
Commercial
30,708,282,078.93 93.01% 20,573,298,027.59 89.95% 49.26%
vehicles
Spare parts and
2,306,379,835.20 6.99% 2,298,237,233.97 10.05% 0.35%
others
By regions
Northeast China,
North China,
Northwest China 17,861,002,372.03 54.10% 11,576,136,202.31 50.61% 54.29%
and Southwest
China
East China,
South China and 15,153,659,542.10 45.90% 11,295,399,059.25 49.39% 34.16%
Central China
Information on industries, products or regions accounting for more than 10% of the Company's
operating income or operating profit
Applicable □ Not applicable
20
Full Text of 2023 Semi-annual Report FAW JIEFANG GROUP CO.,LTD.
Unit: CNY
Increase/Decrea
Increase/Decrea Increase/Decrea
se of Gross
Gross se of Operating se of Operating
Operating Operating Profit Rate over
Profit Income over the Cost over the
Income Costs the Same
Rate Same Period of Same Period of
Period of Last
Last Year Last Year
Year
By industries
Automobile 32,139,093, 29,929,907,291 Decreased by
6.87% 47.39% 48.02%
industry 286.21 .11 0.40%
By products
30,708,282, 28,599,271,268 Reduced by
Vehicle 6.87% 49.26% 49.83%
078.93 .32 0.35%
Spare parts and 1,430,811,2 1,330,636,022. Reduced by
7.00% 16.14% 17.43%
others 07.28 79 1.02%
By regions
Northeast
China, North
China,
17,387,317, 16,194,263,678 Increased by
Southwest 6.86% 57.54% 57.44%
880.55 .95 0.06%
China and
Northwest
China
East China,
South China 14,751,775, 13,735,643,612 Reduced by
6.89% 36.99% 38.27%
and Central 405.66 .16 0.86%
China
The main business data of the Company adjusted at the end of the latest reporting period if the
statistical caliber of the Company's main business data is adjusted in the reporting period
□ Applicable Not applicable
IV. Analysis of Non-main Business
□ Applicable Not applicable
V. Analysis of Assets and Liabilities
1. Major changes in asset composition
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Full Text of 2023 Semi-annual Report FAW JIEFANG GROUP CO.,LTD.
Unit: CNY
At the End of This Reporting
End of Last Year
Period Description
Increase/Decrease
Proportion of Major
Proportion in in Proportion
Amount Amount in Total Changes
Total Assets
Assets
26,737,335,99
Monetary capital 37.13% 21,041,473,417.71 37.06% 0.07%
9.70
Accounts 2,834,227,703
3.94% 867,090,338.42 1.53% 2.41%
receivable .58
Contract assets 19,838,584.22 0.03% 11,129,624.75 0.02% 0.01%
7,831,442,068
Inventories 10.88% 6,382,739,897.83 11.24% -0.36%
.22
Investment
75,871,489.04 0.11% 80,647,597.48 0.14% -0.03%
properties
Long-term equity 5,639,466,464
7.83% 4,692,648,635.84 8.27% -0.44%
investments .29
9,728,773,885
Fixed assets 13.51% 9,612,922,810.28 16.93% -3.42%
.88
Project under 1,680,851,141
2.33% 1,902,143,354.11 3.35% -1.02%
construction .66
Right-of-use 167,591,959.3
0.23% 198,220,342.59 0.35% -0.12%
assets 8
1,618,103,749
Contract liabilities 2.25% 1,629,524,704.35 2.87% -0.62%
.23
Lease liabilities 48,808,071.74 0.07% 54,814,603.06 0.10% -0.03%
2. Main overseas assets
□ Applicable Not applicable
3. Assets and liabilities measured at fair value
□ Applicable Not applicable
4. Restrictions on asset rights as of the end of the reporting period
For details, please refer to Note 61 "Assets with restricted ownership or use right" in part VII
"Notes to Items in Consolidated Financial Statements" of Section X - Financial Report.
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VI. Investment Analysis
1. Overall situation
Applicable □ Not applicable
Investment Amount in the Investment Amount in the Same
Variation range
Reporting Period (CNY) Period of Previous Year (CNY)
725,139,697.94 0.00 100.00%
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2. Major equity investments acquired in the reporting period
Applicable □ Not applicable
Unit: CNY
Profit and Loss
Name of Progress as of Involved in
Main Investment Investment Share Capital Investment Product Estimated of Investment Date of
Investee Partners Balance Sheet Litigation or Disclosure Index
business method amount proportion source horizon type Revenue in the Current Disclosure
Company Date not
Period
http://www.cninfo.com
Changchun CHINA .cn/new/disclosure/deta
Automobile
Automotive Capital 670,872,89 FAW Testing Delivery December il?orgId=gssz0000800
testing 14.63% Own Funds Long-term — 6,235,810.40 No
Test Center increase 7.94 GROUP services completed 16, 2022 &announcementId=12
services, etc.
Co., Ltd. CO., LTD. 15367764&announcem
entTime
670,872,89
Total -- -- -- -- -- -- -- -- — 6,235,810.40 -- -- --
7.94
3. Major non-equity investments in progress in the reporting period
□ Applicable Not applicable
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4. Financial assets investment
(1) Securities investment
□ Applicable Not applicable
The Company has no securities investment in the reporting period.
(2) Derivatives investment
□ Applicable Not applicable
The Company has no derivative investment in the reporting period.
5. Use of raised funds
□ Applicable Not applicable
The Company does not use raised funds in the reporting period.
VII. Sales of Major Assets and Equity
1. Sale of major assets
□ Applicable Not applicable
The Company does not sell major assets in the reporting period.
2. Sale of major equity
□ Applicable Not applicable
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VIII. Analysis on Principal Holding and Joint-stock Companies
Applicable □ Not applicable
Major subsidiaries and joint-stock companies affecting over 10% net profit of the Company
Unit: CNY
Company Company
Main business Registered Capital Total Assets Net Assets Operating income Operating Profit Net Profit
Name Type
Development,
FAW
manufacturing
Jiefang Subsidiarie CNY
and sales of 67,414,636,416.24 19,720,204,035.96 33,014,661,914.13 -39,373,044.91 169,432,997.80
Automotive s 10,803,012,500
vehicles and
Co., Ltd.
parts
Handling of
financial
business within
First
the Group and
Automobile Joint-stock CNY
other financial 143,985,892,114.85 21,773,133,729.59 3,209,535,678.73 1,548,095,240.57 1,165,863,071.10
Finance companies 10,000,000,000
businesses
Co., Ltd.
approved by
the People's
Bank of China
Acquisition and disposal of subsidiaries in the reporting period
□ Applicable Not applicable
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IX. Structured Entities Controlled by the Company
□ Applicable Not applicable
X. Risks Faced by the Company and Countermeasures
(I) Market change risk
Description: The international situation is becoming increasingly complex, and the
competition situation in the commercial vehicle market remains unchanged. Foreign automobile
enterprises have stepped up their layout in the domestic market, and the wait-and-see mood of
domestic commercial vehicle consumption has increased. At the same time, leading domestic
truck enterprises are making efforts to compete in the export market, and the overseas competition
for commercial vehicles is becoming increasingly fierce. Under the mutual influence of many
conditions, the Company faces certain market change risks.
Countermeasures: Take a customer-oriented approach, actively go deep into terminals,
identify market opportunities, and seize terminal needs. Introduce new products in line with
market changes in due course, actively upgrade products, explore market segments, formulate
more competitive policies at the same time, and seek domestic market increment. Fully deploy
overseas markets, accelerate product introduction, create "high-end, medium-end and low-end"
product portfolios, and enhance the competitiveness of overseas commodities; based on the
principle of brand promotion, cooperate with key markets to carry out a series of activities to
continuously improve the overseas influence of Jiefang brand; consolidate existing overseas
advantages and basic capabilities such as channels, services, and finance, comprehensively build
an overseas marketing system, and promote the achievement of overseas strategic objectives.
(II) Industry competition risk
Description: The overall output and sales volume of the new energy vehicle market are
growing rapidly, albeit at a pace slower than before, but still much higher than the overall growth
rate of the automobile market. Affected by the overall market environment, the competition in the
commercial vehicle industry is becoming increasingly severe. The penetration rate of new energy
commercial vehicles continues to rise, intensifying competition among competitors. Additionally,
with the continuous improvement of research and development capabilities in the new energy
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Full Text of 2023 Semi-annual Report FAW JIEFANG GROUP CO., LTD.
field, the Company needs to take measures to address the impact of industry competition in this
environment.
Countermeasures: Explore market demand, focus on the advantages of energy conservation
and reliability, develop key products, and build product competitiveness; deeply study new energy
core technologies, improve the layout of new energy assembly products, and enhance the
competitiveness of new energy core assemblies; continuously improve the new energy industrial
chain through industry insight and accelerate the development of new energy ecosystem.
(III) Risk of raw material price fluctuation
Description: Affected by geographical conflicts, global inflation, repeated expectations of the
Federal Reserve for interest rate hikes and other factors, the commodity market is constantly
disturbed; sluggish domestic demand for raw materials such as steel, coupled with high
production costs and compressed profit margins for some raw material producers, causes
continuous fluctuations in raw material prices, which will have a certain impact on the Company.
Countermeasures: Strengthen the collection of market and policy information, study and
judge the scope and degree of impact of price fluctuations of key raw materials, and adjust
procurement strategies in a timely manner; optimize raw material procurement costs by improving
management mechanisms; continuously improve supply resources to ensure that the number of
suppliers meets supply requirements.
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Section IV Corporate Governance
I. Information on Annual Shareholders' Meeting and Extraordinary Shareholders'
Meeting Held in the Reporting Period
1. Shareholders' meeting in the reporting period
Participation
Date of Date of
Session Meeting Type Ratio of Meeting Resolution
Meeting Disclosure
Investors
The Proposal on Repurchase and
Cancellation of Partial Restricted
Shares in the Phase I Restricted
Share Incentive Plan, the Proposal
on Change of Registered Capital
of the Company, the Proposal on
Amending the Articles of
First
Association, the Proposal on
extraordinary Extraordinary
March 2, March 3, Estimated Daily Related
shareholders' shareholders' 84.91%
2023 2023 Transaction Amount in 2023, the
meeting of meeting
Proposal on Signing a Financial
2023
Service Framework Agreement
with First Automobile Finance
Co., Ltd., and the Proposal on
Estimated Financial Business
Amount with First Automobile
Finance Co., Ltd. in 2023 were
deliberated and approved.
The 2022 Work Report of the
Board of Directors, the 2022 Work
Report of the Board of
Supervisors, the 2022 Financial
Statements, the 2022 Annual
Report and Summary Thereof, the
2022 Annual Annual
April 24, April 25, 2022 Profit Distribution Plan, the
shareholders' shareholders' 83.95%
2023 2023 Proposal on Unsuccessful Lifting
meeting meeting
of Conditions of the Second
Release Period First Granted by
the Phase I Restricted Share
Incentive Plan for Releasing the
Restricted Sales and of Conditions
of the First Release Period
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Reserved by the Phase I Restricted
Share Incentive Plan for Releasing
the Restricted Sales and
Repurchase and Cancellation of
Some Restricted Shares, the
Proposal on Change of Registered
Capital of the Company, the
Proposal on Amending the Articles
of Association, the Proposal on
Election of Non-employee
Representative Supervisors of the
10th Board of Supervisors at the
General Meeting of the Board of
Supervisors, the Proposal on
Election of Non-independent
Directors of the 10th Board of
Directors at the General Meeting
of the Board of Directors, and the
Proposal on Election of
Independent Directors of the 10th
Board of Directors at the General
Meeting of the Board of Directors
were deliberated and approved.
2. Preferred shareholders with resumed voting rights request to convene an extraordinary
shareholders' meeting
□ Applicable Not applicable
II. Changes in Directors, Supervisors and Senior Executives of the Company
□ Applicable Not applicable
The directors, supervisors and senior executives of the Company have not changed during the
reporting period. Please refer to the 2022 Annual Report for details.
III. Profit Distribution and Transfer from Capital Reserve to Share Capital in the Reporting
Period
□ Applicable Not applicable
The Company does not plan to pay cash dividends or bonus shares, or convert reserves into share
capital in the first half of the year.
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IV. Implementation of the Company's Equity Incentive Plan, Employee Stock Ownership
Plan or Other Employee Incentive Measures
Applicable □ Not applicable
1. Equity incentive
(1) On October 28, 2022, the Company held the 28th Meeting of the 9th Board of Directors
and the 24th Meeting of the 9th Board of Supervisors respectively to deliberate and approve the
Proposal on Repurchase and Cancellation of Partial Restricted Shares in the Phase I Restricted
Share Incentive Plan. The Proposal was subsequently deliberated and approved at the 3rd
Extraordinary Shareholders’ Meeting of the Company in 2022. It was agreed to repurchase and
cancel a total of 1,359,247 restricted stocks, either in full or in part, that were granted but not yet
released from restrictions to the original 11 incentive recipients; on January 17, 2023, The
Company issued the Announcement on Completion of Repurchase and Cancellation of Some
Restricted Shares on CNINFO (http://www.cninfo.com.cn).
(2) On December 15, 2022, the Company held the 30th meeting of the 9th Board of Directors
and the 26th meeting of the 9th Board of Supervisors respectively to deliberate and approve the
Proposal on the Achievement of Unlocking Conditions in the First Release Period of the
Restricted Shares Firstly Granted in the Phase I Restricted Incentive Plan, agreeing that the
Company handled the unlocking of 13,042,347 shares of 311 incentive objects meeting the
unlocking conditions during the first release period of restricted shares granted for the first time in
accordance with the relevant provisions of the restricted share incentive plan. On February 3,
2023, the Company disclosed the Indicative Announcement on Listing and Circulation of
Unlocked Shares in the First Release Period of the Restricted Shares Firstly Granted in the Phase
I Restricted Share Incentive Plan on CNINFO (http://www.cninfo.com.cn), and the unlocked
restricted shares will be listed and circulated on February 6, 2023. On April 28, 2023, the
Company issued the Announcement on Completion of Repurchase and Cancellation of Some
Restricted Shares on CNINFO (http://www.cninfo.com.cn)).
(3) On March 31, 2023, the Company held the 32nd meeting of the 9th Board of Directors and
the 28th meeting of the 9th Board of Supervisors respectively, deliberated and approved the
Proposal on Unsuccessful Lifting of Conditions of the Second Release Period First Granted by
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the Phase I Restricted Share Incentive Plan for Releasing the Restricted Sales and of Conditions
of the First Release Period Reserved by the Phase I Restricted Share Incentive Plan for Releasing
the Restricted Sales and Repurchase and Cancellation of Some Restricted Shares, agreeing to
repurchase and cancel 327 restricted shares of incentive objects that do not meet the release
conditions. The total number of shares repurchased was 13,909,890. The Proposal was deliberated
and approved at the Company's 2022 Annual Shareholders’ Meeting held on April 24, 2023. On
June 30, 2023, the Company issued the Announcement on Completion of Repurchase and
Cancellation of Some Restricted Shares on CNINFO (http://www.cninfo.com.cn).
(4) On April 27, 2023, the Company held the 2nd meeting of the 10th Board of Directors and
the 2nd meeting of the 10th Board of Supervisors respectively to deliberate and approve the
Proposal on Lifting the Trading Restrictions of Partial Restricted Shares. A total of 4 incentive
objects met the conditions for lifting the trading restrictions this time, and 64,954 shares were
lifted. On May 15, 2023, the Company issued the Prompt Announcement on Lifting Sales
Restrictions and Listing Circulation of Partial Restricted Shares on CNINFO
(http://www.cninfo.com.cn), and the unlocked restricted shares were listed and circulated on May
16, 2023.
For details of the above proposals, please refer to the relevant announcements published by the Company in
Securities Times, China Securities Journal and CNINFO (http://www.cninfo.com.cn).
2. Implementation of employee stock ownership plan
□ Applicable Not applicable
3. Other employee incentives
□ Applicable Not applicable
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Section V Environmental and Social Responsibilities
I. Major Environmental Protection Issues
Whether the listed company and its subsidiaries are key pollutant discharging entities announced
by the environmental protection authority
Yes □ No
Environmental protection related policies and industry standards
The Company strictly abides by the Environmental Protection Law of the People's Republic
of China, the Law of the People's Republic of China on Prevention and Control of Atmospheric
Pollution, the Law of the People's Republic of China on Prevention and Control of Noise
Pollution, the Law of the People's Republic of China on Prevention and Control of Soil Pollution,
the Law of the People's Republic of China on Prevention and Control of Water Pollution,
the Law of the People's Republic of China on the Prevention and Control of Atmospheric
Pollution, the Environmental Protection Tax Law of the People's Republic of China, the Measures
for the Administration of the List of Key Units of Environmental Supervision, the Measures for the
Administration of Legal Disclosure of Environmental Information of Enterprises, the Measures
for the Administration of Hazardous Waste Transfer and other relevant laws and regulations, as
well as national and industrial standards such as the Integrated Wastewater Discharge Standard
(GB8978-1996), the Integrated Emission Standard of Air Pollutants (GB16297-1996), the
Standard for Pollution Control on Hazardous Waste Storage (GB 18597-2023), the Technical
Guidelines for Environmental Impact Assessment - Acoustic Environment, the Technical
Guideline for Deriving Hazardous Waste Management Plans and Records (HJ 1259-2022), the
Technical Specification for Pollution Control of Waste Plastics and the Technical Specifications
for Acceptance of Environmental Protection Facilities for Completed Construction Projects -
Automotive Industry (HJ 407-2021).
Administrative licensing for environmental protection
The Company strictly implemented the "Environmental Impact Assessment" and "Three
Simultaneities" systems for all projects. All key pollutant discharging entities shall apply for
33
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pollutant discharge permits according to legal provisions, and strictly implement the pollutant
discharge permit system.
Application
(Renewal) Date Pollutant Validity
S/N Name of Unit of Pollutant Discharge Permit Period
Discharge No. (Year)
Permit
1 December 30, 9122010174302872
Truck Factory of FAW Jiefang Automotive Co., Ltd 5
2022 5R
2 Chengdu Branch of FAW Jiefang Automotive Co., 9151011474640772
July 14, 2022 5
Ltd. 0B001V
3 Transmission Branch (Transformation Factory) of December 31, 9122010157113166
5
FAW Jiefang Automotive Co., Ltd. 2021 1N001Q
4 Transmission Branch (Axle Factory) of FAW December 31, 9122010157113166
5
Jiefang Automotive Co., Ltd. 2021 1N002V
5 Changchun Intelligent Bus Branch of FAW Jiefang 91220108MA170M
January 8, 2023 5
Automotive Co., Ltd. RB74001V
6 December 31, 9137020016356734
FAW Jiefang (Qingdao) Automotive Co., Ltd. 5
2019 3M
7 Engine Branch of FAW Jiefang Automotive Co., 9122010175616357
December 8, 2022 5
Ltd. 19001Q
8 Wuxi Diesel Engine Works of FAW Jiefang December 10, 9132020633096901
5
Automotive Co., Ltd. 2021 7N001C
9 Wuxi Diesel Engine Huishan Factory of FAW 9132020074815922
June 19, 2023 5
Jiefang Automotive Co., Ltd. 2H001C
10 9121021371788030
FAW Jiefang Dalian Diesel Engine Co., Ltd. October 9, 2022 5
8K001U
Industry Emission Standards and Specific Conditions of Pollutant Discharge Involved in
Production and Operation Activities
Types of
Names of
Main Number Distribution Enforced
Name of Main Total
Pollutants Discharge of of Discharge pollutant Total Excessive
Company or Pollutants Approved
and Mode Discharge Discharge concentration/intensity discharge Discharge Discharge
Subsidiary and Specific Discharge
Specific Outlets Outlets standard
Pollutants
Pollutants
Continuous One for
Truck Factory
or frame, cab No
of FAW Jiefang
Wastewater COD intermittent 4 and non- 137.6mg/L 800mg/L 12.7465 t 630.104 t excessive
Automotive
discharge metal discharge
Co., Ltd
of coating
34
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wastewater respectively,
and one for
general
domestic
sewage
outlet
Continuous Frame, cab,
discharge roof of non- No
Exhaust Non-methane
during 71 metallic 2.59mg/m 120mg/m 43.3168 t 335.4 t excessive
gas hydrocarbon
waste gas coating discharge
production workshop
Southeast of No
Intermittent
Wastewater COD 1 the 48.33mg/L 500mg/L 0.2033 t 21.3 t excessive
Chengdu discharge
Company discharge
Branch of FAW
Continuous
Jiefang
discharge Roof of No
Automotive Exhaust Non-methane
during 1 coating 7.27mg/m 60mg/m 11.6249 t 75.91 t excessive
Co., Ltd. gas hydrocarbon
waste gas workshop discharge
production
One in the
northwest
corner of
substation
one
Intermittent
workshop No
discharge
Wastewater COD 2 and one in 19mg/L 500mg/L 0.8456 t 10 t excessive
of
Transmission the discharge
wastewater
Branch southwest
(Transformation corner of
Factory) of substation
FAW Jiefang two
Automotive workshop
Co., Ltd. Four for
No. 1
Continuous
workshop
discharge No
Exhaust Non-methane and one for
during 5 8.4mg/m 120mg/m 1.2359 t - excessive
gas hydrocarbon the south
waste gas discharge
side outside
production
No. 1
workshop
Transmission Two for No.
Branch (Axle 1, No. 2 and No
Intermittent
Factory) of Wastewater COD 6 No. 3 21mg/L 500mg/L 1.2801 t - excessive
discharge
FAW Jiefang workshops discharge
Automotive respectively
Co., Ltd. Exhaust Non-methane Continuous 20 Eight for 0.7mg/ m 120mg/m 7.0542 t - No
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gas hydrocarbon discharge No. 1 excessive
during workshop, discharge
waste gas seven for
production No. 2
workshop,
and five for
No. 3
workshop
Intermittent South gate
No
discharge of sewage
Wastewater COD 1 66.68mg/L 500mg/L 0.6959 t 4.575 t excessive
Changchun of treatment
discharge
Intelligent Bus wastewater station
Branch of FAW Roof of
Continuous
Jiefang coating and
discharge No
Automotive Exhaust Non-methane welding
during 12 4.18mg/m 120mg/m 4.6084 t 49.5 t excessive
Co., Ltd. gas hydrocarbon workshop
waste gas discharge
of the
production
Company
Engine Branch Intermittent
No
of FAW Jiefang Exhaust Non-methane discharge Workshop
3 1.44mg/m 120 mg/m 0.0206 t - excessive
Automotive gas hydrocarbon of waste roof
discharge
Co., Ltd. gas
One for
No
Continuous west gate
Wastewater COD 3 44mg/L 500mg/L 18.3 t 243 t excessive
discharge and two for
discharge
south gate
Three for
assembly
workshop,
Wuxi Diesel five for the
Engine Works R&D
200 mg/m
of FAW Jiefang Nitrogen Department,
Continuous 95.2 mg/mfor for nitrogen 12.29 t for 27.2 t for
Automotive oxides, two for QA No
Exhaust discharge nitrogen oxide, 2.8 oxide, 60 nitrogen nitrogen
Co., Ltd. smoke and 12 Department, excessive
gas during mg/mfor non- mg/mfor oxide, 0.15 t oxide, 1.77 t
non-methane two for discharge
production methane hydrocarbon non-methane for VOCs for VOCs
hydrocarbons processing
hydrocarbon
workshop
and one for
hazardous
waste
warehouse
Wuxi Diesel No
Continuous One for
Engine Huishan Wastewater COD 1 60mg/m 500mg/m 3.1 t 53.58 t excessive
discharge north gate
Factory of FAW discharge
Jiefang Exhaust Nitrogen Continuous Joint 111 mg/mfor 200 mg/m 1.91 t for 8.48 t for No
6
Automotive gas oxide, non- discharge workshop nitrogen oxide, 6.76 for nitrogen nitrogen nitrogen excessive
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Co., Ltd. methane during mg/mfor non- oxide, 60 oxide, 0.13 t oxide, 1.62 t discharge
hydrocarbon production methane hydrocarbon mg/mfor for VOCs for VOCs
non-methane
hydrocarbon
Continuous Outside the
COD: 500 COD: 11.62 COD: 88.79
or sewage
COD, COD: 79.7 mg/L mg/L; t; t; No
intermittent treatment
Wastewater ammonia 6 Ammonia nitrogen: ammonia Ammonia Ammonia excessive
discharge station of
FAW Jiefang nitrogen 7.72 mg/L nitrogen: 45 nitrogen: nitrogen: discharge
of the
(Qingdao) mg/L 0.9914 t 5.11 t
wastewater Company
Automotive
Continuous Roof of
Co., Ltd.
discharge each No
Exhaust Non-methane
during 81 workshop 2.87 g/m 30mg/m 27.13 t 164.98 t excessive
gas hydrocarbon
waste gas of the discharge
production Company
Continuous Outside the
COD: 300
or sewage COD: 1.796 COD: 88.79
COD, COD:41 mg/L mg/L; No
intermittent treatment t; ammonia t; ammonia
Wastewater ammonia 1 Ammonia nitrogen: ammonia excessive
discharge station of nitrogen: nitrogen:
nitrogen 4.8 mg/L nitrogen: 30 discharge
of the 0.3534 t 5.11 t
FAW Jiefang mg/L
wastewater Company
Dalian Diesel
Non- Non- Non-
Engine Co.,
Continuous methane methane methane
Ltd. Non-methane Non-methane
discharge Roof of the hydrocarbon: hydrocarbon: hydrocarbon: No
Exhaust hydrocarbon hydrocarbon: 0.33
during 5 Company's 120 mg/m 2.246 t, 14.2 t; excessive
gas and nitrogen mg/m nitrogen
waste gas workshop nitrogen nitrogen nitrogen discharge
oxide oxide: 88 mg/m
production oxide: 240 oxide: 1.163 oxide:
mg/m t 11.967 t
Disposal of pollutants
(I) Wastewater treatment:
(1) The Truck Factory of FAW Jiefang Automotive Co., Ltd. has three sewage treatment
stations currently, namely, frame workshop sewage treatment station, coating workshop sewage
treatment station and non-metallic coating sewage treatment station. ① The frame sewage
treatment station has a treatment capacity of 300 tons/day, and mainly treats the electrophoresis
process wastewater before it enters the frame workshop. ② The cab coating workshop sewage
treatment station has a treatment capacity of 400 tons/day, and mainly treats the wastewater and
painting wastewater before they enter the workshop. ③ The non-metallic line sewage treatment
station has a treatment capacity of 240 tons/day, and mainly treats the painting wastewater before
it enters the production line. The wastewater and domestic sewage pretreated by the above three
37
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sewage stations are discharged into the FAW Integrated Sewage Treatment Plant, and then
discharged into the Changchun Western Suburbs Sewage Treatment Plant after being treated to
meet the Class III standard in the Integrated Wastewater Discharge Standard (GB8978-1996).
(2) One sewage treatment station has been built in Chengdu Branch of FAW Jiefang
Automotive Co., Ltd. for the treatment of production and domestic wastewater of the Company,
with a total treatment capacity of 300 tons/day. The main treatment method is SBR process. All
sewage stations can operate continuously and stably, and the sewage discharged up to standard
enters the urban sewage treatment plant through the municipal pipe network for further treatment.
(3) The Transmission Branch (Transformation Factory) of FAW Jiefang Automotive Co.,
Ltd. uses the sewage treatment station in the Shaft Gear Park to treat the Company's production
wastewater. The wastewater treatment plant has a total processing capacity of 5 tons per hour and
operates stably. After being treated by the sewage station, the industrial wastewater that meets the
standards is discharged into the Changchun Xijiao Sewage Treatment Plant for further treatment.
(4) There is an industrial sewage storage tank in each of the three workshops in the
Transmission Branch (Axle Factory) of FAW Jiefang Automotive Co., Ltd., which signs a
disposal contract with FAW to transfer the sewage by FAW tanks to the comprehensive treatment
workshop for compliance disposal every day.
(5) One sewage treatment station is built in Changchun Intelligent Bus Branch of FAW
Jiefang Automotive Co., Ltd. for the treatment of production and domestic wastewater of the
Company, with a treatment capacity of 120 tons/day. The physicochemical + biochemical
treatment process is adopted, which can operate continuously and stably and discharge up to
standard in real time. The sewage discharged up to standard enters the urban sewage treatment
plant through the municipal pipe network for further treatment.
(6) The industrial wastewater generated by the Engine Branch of FAW Jiefang Automotive
Co., Ltd. is entrusted to FAW with disposal qualification for disposal.
(7) One sewage treatment station is built in Wuxi Diesel Engine Works of FAW Jiefang
Automotive Co., Ltd. for the treatment of production and domestic wastewater of the Company,
with a total treatment capacity of 3,000 tons/day and 24-hour operation. The main treatment
process is physicochemical + biochemical treatment. The sewage station can operate continuously
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and stably, and realize real-time up-to-standard discharge. The up-to-standard discharged sewage
enters the urban sewage treatment plant through the municipal pipe network for further treatment.
(8) One sewage treatment station is built in the Wuxi Diesel Engine Huishan Factory of
FAW Jiefang Automotive Co., Ltd. for the treatment of production and domestic wastewater of
the Company, with a total treatment capacity of 1,000 tons/day and 24-hour operation. The main
treatment process is physicochemical + biochemical treatment. The sewage station can operate
continuously and stably, and realize real-time up-to-standard discharge. The up-to-standard
discharged sewage enters the urban sewage treatment plant through the municipal pipe network
for further treatment.
(9) Two sewage treatment stations are built in FAW Jiefang Qingdao Automotive Co., Ltd.
They combine physicochemical process with biochemical process and are mainly used to treat the
phosphating wastewater, electrophoresis wastewater and degreasing wastewater discharged from
daily production of the coating workshop, as well as the daily domestic sewage of the Company.
The designed maximum daily treatment capacity of the station is 2160 tons/day. The treated
wastewater meets the index requirements of the Wastewater Quality Standards for Discharge to
Municipal Sewers (GB/T 31962-2015), and reaches the Water Quality Standard for Domestic
Miscellaneous Water (GB/T18290-2002) after advanced treatment by MBR equipment, which
greatly reduces the sewage concentration, increases the reuse amount of reclaimed water and
saves water. The up-to-standard treated wastewater is discharged to Jimo North Sewage
Treatment Plant for advanced treatment through the sewage outlet.
(10) One sewage treatment station is built in FAW Jiefang Dalian Diesel Engine Co., Ltd.
for the treatment of production and domestic wastewater, with a total treatment capacity of 816
tons/day and 24-hour operation. The main treatment processes are distillation pretreatment of
production wastewater and biochemical treatment of comprehensive wastewater. The sewage
station can operate continuously and stably, and realize real-time up-to-standard discharge. The
up-to-standard discharged sewage enters the urban sewage treatment plant through the municipal
pipe network for further treatment.
(II) Waste gas treatment:
(1) All waste gas treatment facilities in the Truck Factory of FAW Jiefang Automotive Co.,
Ltd. can operate continuously and stably. The dust generated by the plasma cutting machine in the
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stamping workshop is collected and filtered and then discharged through a 15m exhaust pipe. The
CO2 welding machine adopts a single-machine dust removal system, and the waste gas is
discharged locally in the workshop after being treated by a single-machine dust collector. The
waste gas generated by the treatment and drying process before entering the frame workshop is
discharged through a 15m exhaust pipe after being treated by a direct combustion device. The
exhaust gas of VOCs from cab coating and non-metallic coating is discharged after reaching the
standard through hydrocyclone + zeolite runner adsorption concentration + RTO (regenerative
incineration).
(2) All waste gas treatment facilities of Chengdu Branch of FAW Jiefang Automotive Co.,
Ltd. can operate continuously and stably. The painting waste gas of the coated body is discharged
after reaching the standard through hydrocyclone + dry filtration + zeolite runner adsorption and
concentration + RTO (regenerative incineration). All welding fumes are discharged after being
treated by centralized and mobile dust removal systems and reaching the standard.
(3) All waste gas treatment facilities of the Transmission Branch (Transformation Factory)
of FAW Jiefang Automotive Co., Ltd. can operate continuously and stably. The painting waste
gas generated from the coating line is discharged after reaching the standard and being treated by
activated carbon adsorption and desorption catalytic combustion devices. All welding fumes are
discharged after reaching the standard and being treated by centralized and mobile dust removal
systems.
(4) All waste gas treatment facilities of the Transmission Branch (Axle Factory) of FAW
Jiefang Automotive Co., Ltd. can operate continuously and stably, and all welding fumes are
discharged after reaching the standard and being treated by centralized and mobile dust removal
systems. In December 2022, the VOC treatment facilities for the coating line of Workshop 3 were
installed and put into operation.
(5) Changchun Intelligent Bus Branch of FAW Jiefang Automotive Co., Ltd. plans to
implement various centralized dust removal projects for welding fumes in 2023. The fumes were
discharged up to standard after treatment. This project is being carried out. The waste gas from
the painting process is treated by the pretreatment filtration system + zeolite concentration runner
+ RTO incineration treatment system and then discharged after reaching the standard.
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(6) The Engine Branch of FAW Jiefang Automotive Co., Ltd. has three quenching machines
generating waste gas and equipped with adsorption purification devices. After treatment, the
waste gas is discharged up to standard.
(7) All waste gas treatment facilities of Wuxi Diesel Engine Works of FAW Jiefang
Automotive Co., Ltd. can operate continuously and stably. The painting waste gas generated from
coating is discharged after reaching the standard and receiving activated carbon adsorption and
desorption + catalysis, and the waste gas generated from test run is discharged after reaching the
standard and being treated by SCR treatment device.
(8) All waste gas treatment facilities of Wuxi Diesel Engine Huishan Factory of FAW
Jiefang Automotive Co., Ltd. can operate continuously and stably. The painting waste gas
generated from coating is discharged after reaching the standard and receiving activated carbon
adsorption and desorption + catalysis, and the waste gas generated from test run is discharged
after reaching the standard and being treated by SCR treatment device.
(9) All waste gas treatment facilities of FAW Jiefang (Qingdao) Automotive Co., Ltd. can
operate continuously and stably. The painting waste gas generated by the plastic parts coating
workshop, the cab coating workshop and the general assembly workshop is discharged after
reaching the standard and being purified by paint mist, adsorbed by zeolite concentration runner
and treated by RTO incineration device in the three workshops. The drying waste gas generated
by the general assembly workshop is burned with low nitrogen, and discharged after reaching the
standard and being treated by the quaternary combustion device. The drying waste gas generated
by the coating workshop is burned with low nitrogen and discharged after reaching the standard
and receiving TNV thermal incineration. All welding fumes are discharged after being treated by
filter cartridge dust collector and reaching the standard.
(10) All waste gas treatment facilities of FAW Jiefang Dalian Diesel Engine Co., Ltd. can
operate continuously and stably. The painting waste gas generated from coating is discharged
after reaching the standard and being treated by water curtain paint mist treatment device +
activated carbon adsorption, and the waste gas generated from test run is discharged after being
treated by SCR post-treatment + alkali liquor washing exhaust gas treatment device and reaching
the standard.
(III) Noise control:
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All noise reduction and shock absorption measures of the branches and subsidiaries of the
Company can meet the requirements of national laws and regulations, and the noise within the
plant boundary meets the requirements of national emission regulations.
(IV) Hazardous waste disposal:
All branches and subsidiaries of the Company deliver 100% of hazardous wastes to
organizations with hazardous waste transportation and disposal qualification for compliance
transfer and disposal in strict accordance with the requirements of national laws, regulations and
standards.
Emergency plan for environmental emergencies
All branches and subsidiaries of the Company prepare their own emergency plans for
environmental emergencies as required, which are approved and filed by the local ecological
environment bureau. All organizations organize drills and further revise them every year
according to the requirements of the emergency plan, and have good emergency response
capabilities for environmental emergencies.
Investment in environmental governance and protection and payment of environmental protection
taxes
In the first half of the year, the Company paid more than CNY 20 million for various
environmental protection management fees, investment in environmental protection facilities and
environmental protection taxes.
Environmental self-monitoring plan
All branches and subsidiaries of the Company have prepared their own monitoring plans
according to the requirements of pollutant discharge permits and regulations, and organized
qualified monitoring organizations to monitor wastewater, waste gas, noise and soil in accordance
with the requirements of the plans. The test report for the first half of the year shows that all
monitoring indicators meet the requirements of all national emission regulations and standards.
Administrative penalties due to environmental problems in the Reporting Period
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Name of Impact on Production Rectification
Results of
Company or Cause for Penalties Violations and Operation of the Measures of
Penalties
Subsidiary Listed Company the Company
N/A N/A N/A N/A N/A N/A
Other environmental information that shall be disclosed
All branches and subsidiaries of the Company have been certified by the environmental
management system (GB/T24001-2020), and carried out cleaner production audits in strict
accordance with the requirements. As a responsible central enterprise, FAW Jiefang Automotive
Co., Ltd. strictly abides by the national requirements, has been practicing the concept of scientific
development and is committed to building an ecological civilization benchmark environment-
friendly enterprise of "energy conservation, consumption reduction, emission reduction and
efficiency improvement".
Measures taken to reduce carbon emissions in the reporting period and their effects
Applicable □ Not applicable
FAW Jiefang Automotive Co., Ltd. focuses on energy conservation and carbon reduction,
takes the initiative to align with the government's preferential energy policies, and completes the
market-oriented transaction of green electricity. The photovoltaic clean energy projects
implemented by Changchun Special Vehicle, Axle Branch, Wuxi Diesel Engine, Qingdao
Automobile Co., Ltd., and other subsidiaries in 2022 have been connected to the grid for power
generation in 2023, further reducing carbon emissions. In addition, all units were organized for
energy conservation and carbon reduction activities. A total of 133 improvement measures for
energy saving and consumption reduction were implemented in the first half of the year, reducing
23,200 tons of carbon emissions.
Other information related to environmental protection
In the first half of the year, the Company organized environmental protection publicity
activities. All units shot 81 environmental protection publicity videos, produced 60 publicity
posters, selected 61 excellent improvement cases of environmental protection, and carried out
activities such as environmental protection knowledge competitions.
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II. Social Responsibility
Guided by the spirit of the 20th CPC National Congress, FAW Jiefang is firmly committed to
fulfilling its social responsibilities and comprehensively advancing rural revitalization. The
Company focuses on key areas such as sending temporary officials to work in rural areas,
promoting industry assistance, talent support, and consumption poverty alleviation. It has paired
up with Xinli Village in Zhenlai County, Jilin Province, to promote the improvement of village
appearance, ecological animal husbandry development, and other initiatives. FAW Jiefang has
also partnered with Zhongting Village in Fengshan County, Guangxi, to provide employment
opportunities for local graduates, fostering talent employment and regional economic
development. The Company consistently engages in consumption support by purchasing
agricultural and sideline products from poverty-stricken areas, consolidates and expands the
achievements of poverty alleviation efforts, and continuously contributes to rural revitalization
with the strength of FAW Jiefang.
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Section VI Important Matters
I. Commitments Made by the Company's Actual Controllers, Shareholders, Related
Parties, Purchasers and the Company to Interested Parties that will be Fulfilled in the
Reporting Period, and Commitments not Fulfilled by the End of the Reporting Period
Applicable □ Not applicable
Reasons for Committe Commitment Commitment
Commitments Date: Performance
Commitment d by Type Period
To safeguard the interests of
investors, FAW promises that
after this acquisition is
completed, the Company will The locked
Commitments continue to fulfill the shares were
made in the commitments made by FAW listed and
Acquisition China Shareholder Group during the equity circulated on
August Long-term
Report or FAW Co., Lock-up division reform and strictly April 10,
8, 2011 validity
Equity Ltd. Commitment abide by the relevant 2023, and this
Change regulations of China Securities commitment
Report Regulatory Commission and has been
Shenzhen Stock Exchange on fulfilled.
share transfer, equity changes
and information disclosure of
listed companies.
1. The non-publicly issued The new Among them,
shares of the listed company shares in this the new shares
acquired by asset subscription restructuring in this
in the restructuring will not be will not be restructuring
transferred in any way within transferred in were listed
36 months from the date of any way and circulated
issuance, including but not within 36 on April 10,
Commitments
China Commitment limited to public transfer months from 2023; the
made during April 8,
FAW Co., on restricted through the securities market or the date of shares before
asset 2020
Ltd. shares transfer by agreement. issuance; the the
restructuring
However, the transfer permitted shares restructuring
under applicable laws is already held expired on
exempt from the restrictions before the October 9,
(including but not limited to restructuring 2021. This
share repurchase due to shall not be commitment
performance compensation). transferred has been
2. If the closing price of the within 18 fulfilled.
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listed company's shares is months from
lower than the issue price for the date of
20 consecutive trading days completion
within 6 months after the of the
restructuring, or the closing restructuring.
price at the end of 6 months
after the restructuring is lower
than the issue price, the shares
of the listed company acquired
by FAW Car Co., Ltd. through
asset subscription in this
restructuring will be
automatically extended for 6
months on the basis of the
above lock-up period.
3. The shares of the listed
company already held before
the restructuring shall not be
transferred within 18 months
from the date of completion of
the restructuring, but the
transfer permitted under
applicable laws is exempt from
the restrictions.
4. After the restructuring, if
the shares of the listed
company enjoyed based on the
restructuring are newly
increased due to issuance of
bonus shares, conversion to
share capital, etc., the
aforementioned agreement on
the restricted period shall also
be observed. If the commitment
on the restricted period of the
shares obtained based on the
restructuring is inconsistent
with the latest regulatory
opinions of the securities
regulatory authorities, FAW
Car Co., Ltd. will make
corresponding adjustments
based on the regulatory
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opinions of the relevant
securities regulatory
authorities.
5. After the expiration of the
above restricted period, the
shares of the listed company
obtained shall be transferred
according to the relevant
provisions of the China
Securities Regulatory
Commission and Shenzhen
Stock Exchange.
6. FAW guarantees that it is
willing to assume
corresponding legal
responsibilities in case of
violation of the above
commitments.
For some patents and
proprietary technologies From 2020 to
(hereinafter referred to as 2022, the
"performance commitment share of the
assets") in the purchased assets accumulative
evaluated by the income realized
approach, the income income of the
commitments of the audited Company's
performance compensation performance
assets in the three accounting commitment
Performance years (i.e. 2020, 2021 and assets was
Commitments
China commitment 2022) after the transaction are CNY
made during April 8, April 30,
FAW Co., and as follows: CNY 655,889,000 1,949,149,600
asset 2020 2023
Ltd. compensation in 2020, CNY 688,155,200 in , exceeding
restructuring
arrangement 2021 and CNY 109,386,400 in the
2022. During the performance commitment
commitment period, if as of the amount of
end of the current year, the CNY
accumulated realized income of 495,719,000,
the performance commitment and the
assets is lower than the performance
accumulated committed commitment
income, FAW will compensate was
the listed company year by year completed.
by share-based payment.
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Commitment
made upon
initial public N/A N/A
offering or
refinancing
Equity
incentive N/A N/A
commitment
Other
commitments
to minority
N/A N/A
shareholders
of the
Company
Other
N/A N/A
commitments
Whether the
commitment
Yes
is fulfilled on
time
If the
commitment
is not fulfilled
within the
time limit, the
specific
reasons for N/A
the failure
and the next
work plan
shall be
explained in
detail
II. Non-operating Occupation of Funds by Controlling Shareholders and Other Related
Parties to the Listed Company
□ Applicable Not applicable
During the reporting period, there was no non-operating occupation of funds by controlling
shareholders and other related parties.
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III. Illegal External Guarantee
□ Applicable Not applicable
The Company has no illegal external guarantee in the reporting period.
IV. Appointment and Dismissal of Accounting Firm
Has the semi-annual financial report been audited?
□ Yes No
The semi-annual report of the Company is not audited.
V. Description of the Board of Directors and the Board of Supervisors on the "Non-
standard Audit Report" of the Accounting Firm in the Reporting Period
□ Applicable Not applicable
VI. Description of the Board of Directors on the "Non-standard Audit Report" of the Last
Year
□ Applicable Not applicable
VII. Matters Related to Bankruptcy Reorganization
□ Applicable Not applicable
The Company has no matter related to bankruptcy reorganization in the reporting period.
VIII. Litigation Matters
Major litigation and arbitration matters
□ Applicable Not applicable
The Company has no major litigation or arbitration matter in the reporting period.
Other litigation matters
Applicable □ Not applicable
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Amount Litigation Implementation of
Basic Information Estimated Progress of
Involved (Arbitration) Litigation Date of Disclosure
about Litigation liabilities Litigation
(CNY Results and (Arbitration) Disclosure Index
(Arbitration) formed or not (Arbitration)
10,000) Impact Judgment
Including
estimated Case not closed by
Summary of other Case not No significant
13,002.01 liabilities of the end of the
litigation not closed impact
CNY reporting period
reaching the major
10,045,200
disclosure standard
No significant
3,360.52 No Case closed Completed
impact
IX. Punishment and Rectification
□ Applicable Not applicable
X. Integrity of the Company and Its Controlling Shareholders and Actual Controllers
□ Applicable Not applicable
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XI. Major Related Transactions
1. Related transactions related to daily operations
Applicable □ Not applicable
Pricing Proportion to Approved Whether it Available
Type of Content of Price of Amount of Related Settlement
Related Principle of the Amount Transaction Exceeds the Market Value of Date of
Correlation Related Related Related Transaction (CNY Method of Related Disclosure Index
Transaction Party Related of Similar Amount (CNY Approved Similar Disclosure
Transaction Transaction Transaction 10,000) Transaction
Transaction Transactions 10,000) Amount Transactions
The same
China FAW Group http://www.cninfo.com.c
ultimate Sales of Sales of Market Cash + bill
Import & Export Market price 672,826.42 20.38% 1,096,179 No 672,826.42 n/new/disclosure/detail?
controlling goods goods price settlement
Co., Ltd. plate=szse&orgId=gssz0
party February
000800&stockCode=000
FAW Jiefang Fujie 11, 2023
Associated 800&announcementId=1
(Tianjin) Sales of Sales of Market Cash + bill
enterprise of Market price 121,345.79 3.68% 251,200 No 121,345.79 215827521&announcem
Technology goods goods price settlement
the Company entTime
Industry Co., Ltd.
Total -- -- 794,172.21 -- 1,347,379 -- -- -- -- --
Details of large sales returns N/A
Actual performance in the reporting period, if the total
amount of daily related transactions to be incurred in the For details about the actual performance of related transactions in the reporting period, please see Item XI "Related Parties and Related Transactions" in Section X of this report.
current period is estimated by category
Reasons for large difference between transaction price and
N/A
market reference price
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2. Related transactions arising from the acquisition and sale of assets or equity
□ Applicable Not applicable
The Company has no related transaction arising from the acquisition and sale of assets or equity
in the reporting period.
3. Related transactions of joint foreign investment
Applicable □ Not applicable
Main Total Assets of Net Assets of Net Profit of
Name of the Registered
Business of the Invested the Invested the Invested
Co-investor Correlation Invested Capital of
the Invested Enterprise Enterprise Enterprise
Enterprise the Investee
Enterprise (CNY 10,000) (CNY 10,000) (CNY 10,000)
CHINA Ultimate Changchun
Automobile
FAW controller of Automotive CNY
testing 361,342.41 345,416.02 7,070
GROUP the Test Center 11,714,400
service
CO., LTD. Company Co., Ltd.
Progress of major projects
under construction of the N/A
investee
4. Related credit and debt transactions
Applicable □ Not applicable
Whether there are non-operating related credit and debt transactions
□ Yes No
The Company has no non-operating related credit and debt transactions in the reporting period.
5. Transaction with related finance companies
Applicable □ Not applicable
Deposit Business
Amount Incurred in Current Period
Maximum Deposit Ending
Opening Total Deposit Total Withdrawal
Related Daily Deposit Interest Balance
Correlation Balance (CNY Amount in the Amount in the
Parties Limit (CNY Rate (CNY
10,000) Current Period Current Period
10,000) Range 10,000)
(CNY 10,000) (CNY 10,000)
Associated
First enterprise
Automo of the
bile Company, 0.35%-
3,000,000 1,383,293.43 12,763,495.04 13,298,542.32 848,246.15
Finance the same 2.85%
Co., ultimate
Ltd. controlling
party
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Credit Granting or Other Financial Businesses
Actual Amount
Total Amount
Related Parties Correlation Business Type Incurred
(CNY 10,000)
(CNY 10,000)
Associated enterprise of
First Automobile the Company, the same Other financial
920,000 60,305.65
Finance Co., Ltd. ultimate controlling businesses
party
6. Transactions between finance companies controlled by the Company and related parties
□ Applicable Not applicable
There is no deposit, loan, credit granting or other financial businesses between the finance
companies controlled by the Company and related parties.
7. Other major related transactions
Applicable □ Not applicable
On February 10, 2023, the 31st meeting of the 9th Board of Directors of the Company
reviewed and approved the Proposal on Estimated Amount of Daily Related Transactions in 2023
and the Proposal on Signing a Financial Service Framework Agreement with First Automobile
Finance Co., Ltd., and the Proposal on Estimated Amount of Financial Business with First
Automobile Finance Co., Ltd. in 2023, which were reviewed and approved by the first
extraordinary shareholders' meeting of the Company in 2023.
Relevant Inquiries on Disclosure Website of Interim Report of Major Related Transactions
Disclosure Date of
Name of Temporary Announcement
Name of Temporary Announcement Temporary
Disclosure Website
Announcement
Announcement on estimated amount of daily
February 11, 2023 CNINFO (http://www.cninfo.com.cn)
related transactions in 2023
Announcement on Signing Financial Service
Framework Agreement and Related Party
February 11, 2023 CNINFO (http://www.cninfo.com.cn)
Transactions with First Automobile Finance
Co., Ltd.
Announcement on estimated amount of
financial business with First Automobile February 11, 2023 CNINFO (http://www.cninfo.com.cn)
Finance Co., Ltd. in 2023
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XII. Major Contracts and Their Performance
1. Trusteeship, contracting and lease
(1) Trusteeship
□ Applicable Not applicable
There is no trusteeship made by the Company in the reporting period.
(2) Contracting
□ Applicable Not applicable
There is no contracting made by the Company in the reporting period.
(3) Lease
Applicable □ Not applicable
Description of lease
For details of the Company's operating lease, please refer to Note 14 "Investment Real estate",
Note 15 "Fixed Assets", and Note 19 "Right-of-use Assets" in Notes to Items in Consolidated
Financial Statements (VII) of Section X, and Note 5 "Related Parties and Related Transactions" in
Section XI "Related Parties and Related Transactions".
Projects that bring about profits and losses exceeding 10% of the total profit of the Company in
the reporting period
□ Applicable Not applicable
The Company has no leasing project that brings about profits and losses exceeding 10% of the
total profit of the Company in the reporting period.
2. Major guarantees
□ Applicable Not applicable
The Company has no major guarantee in the reporting period.
3. Entrusted financial management
□ Applicable Not applicable
The Company has no entrusted financial management in the reporting period.
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4. Other major contracts
□ Applicable Not applicable
The Company has no other major contracts in the reporting period.
XIII. Other Major Matters to be Explained
Applicable □ Not applicable
On June 19, 2023, the Company held the 4th Meeting of the 10th Board of Directors and the
3rd Meeting of the 10th Board of Supervisors respectively to deliberate and approve relevant
proposals such as the Proposal on the Company's Eligibility for Issuing A-shares to Specific
Objects and the Proposal on the Company's Plan for Issuing A-shares to Specific Objects in 2023.
These Proposals were deliberated and approved at the 2nd Extraordinary Shareholders’ Meeting of
the Company held on July 18, 2023. The Company disclosed the Announcement of Approval from
China FAW Group Co., Ltd. Regarding the Matters of Issuing A-Share Stocks to Specific Objects
in the Company in 2023. On August 3, 2023, the Company disclosed the Announcement on the
Application for the Issuance of A-shares to Specific Objects in 2023 Accepted by the Shenzhen
Stock Exchange. For details of the above proposals, please refer to the relevant announcements
published by the Company in Securities Times, China Securities Journal and CNINFO
(http://www.cninfo.com.cn).
XIV. Major Events of Subsidiaries
□ Applicable Not applicable
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Section VII Changes in Shares and Shareholders
I. Changes in Shares
1. Changes in shares
Unit: share
Before the Change Increase/Decrease Made by the Change (+, -) After the Change
Issue of Bonus Share Transferred from
Qty. Scale Others Subtotal Qty. Scale
New Shares shares Accumulation Fund
I. Restricted shares 3,241,570,824 69.66% -3,226,753,496 -3,226,753,496 14,817,328 0.32%
1. Shares held by the state
2. Shares held by the state-
3,197,912,134 68.72% -3,197,912,134 -3,197,912,134
owned legal person
3. Shares held by other domestic
43,658,690 0.94% -28,841,362 -28,841,362 14,817,328 0.32%
enterprises
Including: shares held by
domestic legal person
Shares held by domestic
43,658,690 0.94% -28,841,362 -28,841,362 14,817,328 0.32%
natural person
4. Shares held by foreign
enterprises
Including: shares held by
overseas legal person
Shares held by overseas
natural person
4,622,515,0
II. Unrestricted shares 1,411,754,078 30.34% 3,210,760,924 3,210,760,924 99.68%
02
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4,622,515,0
1. CNY ordinary shares 1,411,754,078 30.34% 3,210,760,924 3,210,760,924 99.68%
02
2. Foreign shares listed in China
3. Foreign shares listed overseas
4. Others
4,637,332,3 100.00
III. Total number of shares 4,653,324,902 100.00% -15,992,572 -15,992,572
30 %
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Reasons for changes in shares
Applicable □ Not applicable
During the reporting period, the Company failed to achieve the performance assessment
objectives set for the second release period first granted and the first release period reserved by
the Company's Phase I restricted share incentive plan, and a total of 15,992,572 shares were
repurchased and canceled due to organizational transfer, statutory retirement and personal reasons.
After the aforesaid repurchase and cancellation, the total share capital of the Company was
changed to 4,637,332,330 shares.
Approval of share changes
Applicable □ Not applicable
(1) On October 28, 2022, the Proposal on Repurchase and Cancellation of Partial Restricted
Shares in the Phase I Restricted Share Incentive Plan was reviewed and approved at the 28th
Meeting of the 9th Board of Directors and the 24th Meeting of the 9th Board of Supervisors
respectively, with a total number of 1,359,247 restricted shares repurchased and cancelled. On
November 18, 2022, the Proposal was deliberated and approved at the Company's third
Extraordinary Shareholders' Meeting in 2022.
(2) On December 15, 2022, the Proposal on Repurchase and Cancellation of Partial Restricted
Shares in the Phase I Restricted Share Incentive Plan was reviewed and approved at the 30th
Meeting of the 9th Board of Directors and the 26th Meeting of the 9th Board of Supervisors
respectively, with a total number of 723,435 restricted shares repurchased and cancelled. On
March 2, 2023, the Proposal was deliberated and approved at the Company's first Extraordinary
Shareholders' Meeting in 2023.
(3) On March 31, 2023, the 32nd Meeting of the 9th Board of Directors and the 28th Meeting of
the 9th Board of Supervisors of the Company deliberated and approved the Proposal on
Unsuccessful Lifting of Conditions of the Second Release Period First Granted by the Phase I
Restricted Share Incentive Plan for Releasing the Restricted Sales and of Conditions of the First
Release Period Reserved by the Phase I Restricted Share Incentive Plan for Releasing the
Restricted Sales and Repurchase and Cancellation of Some Restricted Shares, with a total number
of 13,909,890 restricted shares repurchased and canceled. On April 24, 2023, the proposal was
reviewed and approved at the Company's 2022 Annual Shareholders’ Meeting.
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Transfer of share changes
Applicable □ Not applicable
(1) On January 6, 2023, the Company submitted relevant registration materials to CSDC for
1,359,247 shares involved in equity incentive repurchase and cancellation. On January 16, 2023,
CSDC issued the Confirmation of Securities Transfer Registration to the Company, and the total
share capital of the Company was reduced to 4,651,965,655 shares.
(2) On April 20, 2023, the Company submitted relevant registration materials to CSDC for
723,435 shares involved in equity incentive repurchase and cancellation. On April 27, 2023,
CSDC issued the Confirmation of Securities Transfer Registration to the Company, and the total
share capital of the Company was reduced to 4,651,242,220 shares.
(3) On June 20, 2023, the Company submitted relevant registration materials to CDSC for
13,909,890 shares involved in equity incentive repurchase and cancellation. On June 29, 2023,
CSDC issued the Confirmation of Securities Transfer Registration to the Company, and the total
share capital of the Company was reduced to 4,637,332,330 shares.
Implementation progress of share repurchase
□ Applicable Not applicable
Implementation progress of reducing repurchased shares by centralized bidding
□ Applicable Not applicable
Impact of changes in shares on financial indicators such as basic earnings per share and diluted
earnings per share in the latest year and the latest period, and net assets per share attributable to
shareholders with ordinary shares of the Company
Applicable □ Not applicable
In the reporting period, the share capital of the Company decreased by 15,992,572 shares, which
had little impact on the Company's financial indicators such as basic earnings per share, diluted
earnings per share, and net assets per share attributable to shareholders with ordinary shares of the
Company.
Other information disclosed as deemed necessary by the Company or required by the securities
regulatory authority
□ Applicable Not applicable
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2. Changes in restricted shares
Applicable □ Not applicable
Unit: share
Number
of
Number of
Number of Number of Restricted
Restricted
Name of Restricted Shares at Restricted Shares Shares Reason for
Shares at the Release Date
Shareholder the Beginning of the Released in the Increased Restriction
End of the
Period Current Period in the
Period
Current
Period
China FAW Major asset
2,413,412,134 2,413,412,134 April 10, 2023
Co., Ltd. restructuring
FAW Bestune Major asset
784,500,000 784,500,000 April 10, 2023
Car Co., Ltd. restructuring
Equity 25% of the total
Hu Hanjie 334,331 193,912 140,419
incentive number of
Equity shares held are
Wu Bilei 228,552 132,560 95,992
incentive lifted every
Zhang Equity year, and the
228,493 132,526 95,967
Guohua incentive restrictions on
Equity sales are lifted
Ji Yizhi 192,778 111,812 80,966
incentive in phases
Equity according to the
Tian Haifeng 192,778 111,812 80,966
incentive assessment
Equity objectives and
Li Sheng 192,778 111,812 80,966
incentive the restricted
Wang Equity share incentive
192,778 111,812 80,966
Jianxun incentive plan.
The restrictions
on sales are
Other core lifted in phases
employees of according to the
Equity
senior 42,096,202 27,935,116 14,161,086 assessment
incentive
director and objectives and
above the restricted
share incentive
plan.
Total 3,241,570,824 3,226,753,496 0 14,817,328 -- --
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II. Issuance and Listing of Securities
□ Applicable Not applicable
III. Number of Shareholders and Shareholdings of the Company
Unit: share
Total Number of Shareholders with Total Number of Shareholders with Preferred
Ordinary Shares at the End of the 73,409 Share with Restored Voting Rights at the End of 0
Reporting Period the Reporting Period
Shareholding of Shareholders with Ordinary Shares Holding More Than 5% of the Shares or Top 10 Shareholders with Ordinary Shares
Pledge,
Number of
Number of Ordinary Increase and Marking or
Name of Nature of Share Restricted Number of Unrestricted
Shares Held at the End of Decrease in the Freezing
Shareholder Shareholders Proportion Ordinary Ordinary Shares Held
the Reporting Period Reporting Period Status of
Shares Held Qty.
Shares
China FAW State-owned
66.00% 3,060,649,901 3,060,649,901
Co., Ltd. legal person
FAW Bestune State-owned
16.92% 784,500,000 784,500,000
Car Co., Ltd. legal person
Hong Kong
Securities Overseas
1.65% 76,522,001 21,681,689 76,522,001
Clearing legal person
Company Ltd.
Domestic
Lu Min natural 0.78% 36,096,590 36,096,590
person
Jilin Province
State-owned
State-owned 0.30% 13,712,916 13,712,916
legal person
Capital
Domestic
Chao Guo natural 0.17% 8,064,758 205,400 8,064,758
person
Domestic
Li Yan natural 0.17% 7,660,000 7,660,000
person
China
Construction
Others 0.14% 6,534,395 1,073,600 6,534,395
Bank
Corporation -
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GF China
Securities
Auto Index-
based
Securities
Investment
Fund
Zhong Ou
AMC -
Agricultural
Bank of
China -
Zhong Ou &
Others 0.12% 5,549,500 5,549,500
CITIC
Securities
Financial
Asset
Management
Plan
Bosera Asset
Management
Co., Ltd. -
Agricultural
Bank of
China -
Bosera & Others 0.12% 5,549,500 5,549,500
CITIC
Securities
Financial
Asset
Management
Plan
Strategic investors or general legal persons
who become the top 10 shareholders with
N/A
ordinary shares due to the issuance of new
shares
Among the above shareholders, FAW Bestune is a wholly-owned subsidiary of FAW, and is a person acting in
Description of correlation or concerted concert as specified in the Regulations for the Takeover of Listed Companies. The public disclosure data
action of the above shareholders indicates that the Company does not know whether there is a correlation between other shareholders of
outstanding shares, nor whether other shareholders of outstanding shares are persons acting in concert as
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specified in the Regulations for the Takeover of Listed Companies.
Description of involvement of the above
shareholders in entrusting/entrusted voting N/A
rights and waiving voting rights
Special description of the existence of
repurchase special accounts among the top N/A
10 shareholders
Shareholding of Top 10 Shareholders with Unrestricted Ordinary Shares
Number of Unrestricted Ordinary Shares Held at the End of the Type of Shares
Name of Shareholder
Reporting Period Type of Shares Qty.
China FAW Co., Ltd. 3,060,649,901 CNY ordinary shares 3,060,649,901
FAW Bestune Car Co., Ltd. 784,500,000 CNY ordinary shares 784,500,000
Hong Kong Securities Clearing Company Ltd. 76,522,001 CNY ordinary shares 76,522,001
Lu Min 36,096,590 CNY ordinary shares 36,096,590
Jilin Province State-owned Capital 13,712,916 CNY ordinary shares 13,712,916
Chao Guo 8,064,758 CNY ordinary shares 8,064,758
Li Yan 7,660,000 CNY ordinary shares 7,660,000
China Construction Bank Corporation - GF China Securities
6,534,395 CNY ordinary shares 6,534,395
Auto Index-based Securities Investment Fund
Zhong Ou AMC - Agricultural Bank of China - Zhong Ou
5,549,500 CNY ordinary shares 5,549,500
& CITIC Securities Financial Asset Management Plan
Bosera Asset Management Co., Ltd. - Agricultural Bank of
China - Bosera & CITIC Securities Financial Asset 5,549,500 CNY ordinary shares 5,549,500
Management Plan
Among the above shareholders, FAW Bestune is a wholly-owned subsidiary of FAW, and is a
Description of correlation or concerted action between the person acting in concert as specified in the Regulations for the Takeover of Listed Companies.
top 10 shareholders with unrestricted ordinary shares, and The public disclosure data indicates that the Company does not know whether there is a
between the top 10 shareholders with unrestricted ordinary correlation between other shareholders of outstanding shares, nor whether other shareholders of
shares and the top 10 shareholders with ordinary shares
outstanding shares are persons acting in concert as specified in the Regulations for the Takeover
of Listed Companies.
Lu Min, a domestic natural person, holds 36,096,590 shares of the Company through the
guaranteed securities account for customer credit trading of CITIC Securities; Chao Guo, a
Description of participation in financing bonds business of domestic natural person, holds 8,045,600 shares of the Company through the guaranteed
top 10 shareholders with ordinary shares securities account for customer credit trading of Minsheng Securities; Li Yan, a domestic
natural person, holds 7,660,000 shares of the Company through the guaranteed securities
account for customer credit trading of Dongguan Securities.
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Do the top 10 shareholders with ordinary shares and the top 10 shareholders with unrestricted
ordinary shares of the Company conduct agreed repurchase transactions in the reporting period
□ Yes No
The top 10 shareholders with ordinary shares and the top 10 shareholders with unrestricted
ordinary shares of the Company do not conduct agreed repurchase transactions in the reporting
period
IV. Changes in Shareholding of Directors, Supervisors and Senior Management
Applicable □ Not applicable
Number Number Number of Number Of Number of
Number of of Shares of Shares Restricted Restricted Restricted
Number of
Shares Held at Increased Reduced Shares Shares Shares
Employment Shares Held at
Name Position the Beginning in the in the Granted at the Granted In Granted at the
Status the End of the
of the Period Current Current Beginning of The Current End of the
Period (share)
(share) Period Period the Period Period Period
(share) (share) (shares) (shares) (shares)
Hu Chairman of
In-service 334,331 110,329 224,002 334,331 -110,329 224,002
Hanjie the Board
Wu Bilei Director In-service 228,552 75,422 153,130 228,552 -75,422 153,130
Zhang
Director In-service 228,493 75,403 153,090 228,493 -75,403 153,090
Guohua
Deputy
Ji Yizhi General In-service 192,778 63,617 129,161 192,778 -63,617 129,161
Manager
Deputy
Tian
General In-service 192,778 63,617 129,161 192,778 -63,617 129,161
Haifeng
Manager
Deputy
Li Sheng General In-service 192,778 63,617 129,161 192,778 -63,617 129,161
Manager
Secretary of
Wang
the Board of In-service 192,778 63,617 129,161 192,778 -63,617 129,161
Jianxun
Directors
Total -- -- 1,562,488 515,622 1,046,866 1,562,488 -515,622 1,046,866
Changes in controlling shareholders or actual controllers
Changes in controlling shareholders in the reporting period
□ Applicable Not applicable
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There is no change in the controlling shareholders of the Company in the reporting period.
Change of actual controller in the reporting period
□ Applicable Not applicable
There is no change in the actual controller of the Company in the reporting period.
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Section VIII Preferred Shares
□ Applicable Not applicable
The Company has no preferred shares in the reporting period.
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Section IX Bonds
□ Applicable Not applicable
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Section X Financial Report
I. Audit Report
Is the semi-annual report audited
□ Yes No
The semi-annual financial report of the Company is not audited.
II. Financial Statements
The unit in the notes to the financial statement is CNY
1. Consolidated Balance sheet
Prepared by: FAW JIEFANG GROUP CO., LTD.
June 30, 2023
Unit: CNY
Item June 30, 2023 January 1, 2023
Current assets:
Monetary capital 26,737,335,999.70 21,041,473,417.71
Settlement reserve fund
Loans to banks and other financial institutions
Financial assets held for trading
Derivative financial assets
Notes receivable 199,257,997.67 186,748,716.22
Accounts receivable 2,834,227,703.58 867,090,338.42
Accounts receivable financing 8,679,460,881.09 3,461,653,473.66
Advance payment 938,225,679.34 897,834,864.08
Premiums receivable
Reinsurance accounts receivable
Reinsurance contract reserves receivable
Other receivables 1,116,025,414.02 1,068,454,162.91
Including: interests receivable
Dividends receivable 2,608,000.00 2,608,000.00
Financial assets purchased under agreements to resell
Inventories 7,831,442,068.22 6,382,739,897.83
Contract assets 19,838,584.22 11,129,624.75
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Held-for-sale assets
Current portion of non-current assets 202,027,832.48 191,262,030.30
Other current assets 677,109,911.29 894,927,499.59
Total current assets 49,234,952,071.61 35,003,314,025.47
Non-current assets:
Loans and advances
Debt investment
Other debt investments
Long-term receivables 121,735,209.12 121,606,587.43
Long-term equity investments 5,639,466,464.29 4,692,648,635.84
Other equity instruments investments 480,780,000.00 480,780,000.00
Other non-current financial assets
Investment properties 75,871,489.04 80,647,597.48
Fixed assets 9,728,773,885.88 9,612,922,810.28
Project under construction 1,680,851,141.66 1,902,143,354.11
Productive biological assets
Oil and gas assets
Right-of-use assets 167,591,959.38 198,220,342.59
Intangible assets 2,492,220,427.43 2,549,096,918.05
Development expenditures
Goodwill
Long-term deferred expenses 42,793.98 130,439.66
Deferred income tax assets 2,379,696,384.14 2,131,349,905.21
Other non-current assets
Total non-current assets 22,767,029,754.92 21,769,546,590.65
Total assets 72,001,981,826.53 56,772,860,616.12
Current liabilities:
Short-term loans
Borrowing from the central bank
Placements from banks and other financial institutions
Financial liabilities held for trading
Derivative financial liabilities
Notes payable 16,487,079,559.64 9,198,593,038.03
Accounts payable 17,632,426,555.29 10,033,608,668.06
Advance receipts 785,227.42 1,861,865.37
Contract liabilities 1,618,103,749.23 1,629,524,704.35
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Financial assets sold under agreement to repurchase
Deposits taking and interbank deposits
Acting trading securities
Acting underwriting securities
Employee compensation payable 608,021,510.57 436,648,178.76
Taxes payable 306,157,466.06 301,211,845.51
Other payables 5,882,695,835.17 6,095,452,748.17
Including: interests payable
Dividends payable 171,500.02 171,500.02
Handling charges and commissions payable
Reinsurance accounts payable
Held-for-sale liabilities
Current portion of non-current liabilities 30,986,742.12 32,998,374.87
Other current liabilities 144,682,448.10 133,584,259.07
Total current liabilities 42,710,939,093.60 27,863,483,682.19
Non-current liabilities:
Insurance contract reserve
Long-term loans
Bonds payable
Including: preferred shares
Perpetual bond
Lease liabilities 48,808,071.74 54,814,603.06
Long-term payables
Long-term employee compensation payable 715,447,579.98 707,310,890.43
Estimated liabilities 949,975,699.48 875,468,804.10
Deferred income 3,018,395,694.23 3,121,985,685.93
Deferred income tax liabilities 431,375,668.15 430,369,867.93
Other non-current liabilities
Total non-current liabilities 5,164,002,713.58 5,189,949,851.45
Total liabilities 47,874,941,807.18 33,053,433,533.64
Owner's equities:
Share capital 4,637,332,330.00 4,651,965,655.00
Other equity instruments
Including: preferred shares
Perpetual bond
Capital reserves 10,380,658,208.81 10,451,088,236.74
Less: treasury shares 175,297,320.84 267,837,184.11
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Other comprehensive incomes -5,148,664.92 -5,399,120.81
Special reserves 368,969,960.15 370,420,291.86
Surplus reserves 3,058,249,602.44 3,058,249,602.44
General risk provision
Undistributed profits 5,862,275,903.71 5,460,939,601.36
Total equity attributable to owners of the parent company 24,127,040,019.35 23,719,427,082.48
Minority equity
Total owners' equity 24,127,040,019.35 23,719,427,082.48
Total liabilities and owner's equities 72,001,981,826.53 56,772,860,616.12
Legal representative: Hu Hanjie Person in charge of accounting: Ji Yizhi
Person in charge of the accounting organization: Si Yuzhuo
2. Balance sheet of parent company
Unit: CNY
Item June 30, 2023 January 1, 2023
Current assets:
Monetary capital 11,101,392.62 5,776,955.29
Financial assets held for trading
Derivative financial assets
Notes receivable
Accounts receivable
Accounts receivable financing
Advance payment
Other receivables 224,132.76 224,132.76
Including: interests receivable
Dividends receivable
Inventories
Contract assets
Held-for-sale assets
Current portion of non-current assets
Other current assets 232,371.93 141,004.41
Total current assets 11,557,897.31 6,142,092.46
Non-current assets:
Debt investment
Other debt investments
Long-term receivables
Long-term equity investments 25,808,262,158.37 25,580,280,570.19
Other equity instruments investments
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Other non-current financial assets
Investment properties
Fixed assets
Project under construction
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditures
Goodwill
Long-term deferred expenses
Deferred income tax assets
Other non-current assets
Total non-current assets 25,808,262,158.37 25,580,280,570.19
Total assets 25,819,820,055.68 25,586,422,662.65
Current liabilities:
Short-term loans
Financial liabilities held for trading
Derivative financial liabilities
Notes payable
Accounts payable 128,702.00 964,364.48
Advance receipts
Contract liabilities
Employee compensation payable
Taxes payable 3,336,769.58 3,264,343.98
Other payables 300,297,162.35 298,294,257.75
Including: interests payable
Dividends payable 171,500.02 171,500.02
Held-for-sale liabilities
Current portion of non-current liabilities
Other current liabilities
Total current liabilities 303,762,633.93 302,522,966.21
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred shares
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Perpetual bond
Lease liabilities
Long-term payables
Long-term employee compensation payable
Estimated liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 303,762,633.93 302,522,966.21
Owner's equities:
Share capital 4,637,332,330.00 4,651,965,655.00
Other equity instruments
Including: preferred shares
Perpetual bond
Capital reserves 12,201,032,675.61 12,278,939,213.88
Less: treasury shares 175,297,320.84 267,837,184.11
Other comprehensive incomes -226,374.01 -480,794.77
Special reserves
Surplus reserves 1,827,531,841.54 1,827,531,841.54
Undistributed profits 7,025,684,269.45 6,793,780,964.90
Total owners' equity 25,516,057,421.75 25,283,899,696.44
Total liabilities and owner's equities 25,819,820,055.68 25,586,422,662.65
3. Consolidated profit statement
Unit: CNY
Item Semi-annual 2023 Semi-annual 2022
I. Total operating income 33,014,661,914.13 22,871,535,261.56
Including: operating income 33,014,661,914.13 22,871,535,261.56
Interest income
Premium earned
Handling charges and commission income
II. Total operating cost 33,178,733,500.55 23,120,223,828.02
Including: operating cost 30,590,523,778.02 21,115,050,469.61
Interest expense
Handling charges and commission expense
Surrender value
Net payments for insurance claims
Net allotment of reserves for insurance liabilities
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Policy dividend expenditure
Reinsurance expenses
Taxes and surcharges 109,841,569.80 106,500,261.51
Sales expenses 774,822,818.33 566,490,728.82
Administrative expenses 871,161,062.92 887,020,116.52
R&D expenses 1,248,047,703.54 1,016,316,222.64
Financial expenses -415,663,432.06 -571,153,971.08
Including: interest expenses 2,201,462.83 2,361,612.41
Interest income 332,873,373.32 502,087,676.33
Add: Other incomes 195,656,370.11 230,047,050.32
Investment income (loss to be listed with “-”) 133,617,879.87 203,908,916.41
Including: income from investment in associates
234,054,148.54 281,180,159.71
and joint ventures
Gains on derecognition of financial assets at
amortized cost
Foreign exchange gains (loss to be listed with "-")
Net exposure hedging income (loss to be listed with "-")
Profit arising from changes in fair value (loss to be listed
with "-")
Credit impairment loss (loss to be listed with “-”) -35,480,726.08 -21,826,743.35
Asset impairment loss (loss to be listed with “-”) -35,324,171.95 -85,344,746.96
Income from assets disposal (loss to be listed with “-”) 98,132,494.11 42,431.19
III. Operating profit (loss to be listed with "-") 192,530,259.64 78,138,341.15
Add: non-operating income 9,542,486.79 104,058,106.26
Less: non-operating expenses 3,801,763.81 12,214,234.59
IV. Total profit (loss to be listed with "-") 198,270,982.62 169,982,212.82
Less: Income tax expenses -203,065,319.73 -171,674.50
V. Net profit (net loss to be listed with "-") 401,336,302.35 170,153,887.32
(I) Classified by continuity of operation
1. Net profit from continuing operations (net loss to be
401,336,302.35 170,153,887.32
listed with "-")
2. Net profit from discontinuing operations (net loss to be
listed with "-")
(II) Classified by attribution of the ownership
1. Net profit attributable to shareholders of the parent
401,336,302.35 170,153,887.32
company (net loss to be listed with "-")
2. Minority profit and loss (net loss to be listed with “-”)
VI. Net after-tax amount of other comprehensive income 250,455.89 -44,893.81
Net after-tax amount of other comprehensive income 250,455.89 -44,893.81
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attributable to the owners of the parent company
(I) Other comprehensive incomes that cannot be
reclassified into profits or losses
1. Changes arising from re-measurement of the defined
benefit plan
2. Other comprehensive incomes that cannot be
transferred to profits or losses under the equity method
3. Changes in fair value of investment in other equity
instruments
4. Changes in fair value of the Company’s credit risk
5. Others
(II) Other comprehensive incomes that will be reclassified
250,455.89 -44,893.81
into profits or losses
1. Other comprehensive incomes that can be transferred
254,420.76 -46,736.62
to profits or losses under the equity method
2. Changes in the fair value of other debt investments
3. Amount of financial assets reclassified into other
comprehensive incomes
4. Other debt investment credit impairment provisions
5. Cash flow hedging reserve
6. Translation difference in foreign currency financial
-3,964.87 1,842.81
statements
7. Others
Net after-tax amount of other comprehensive income
attributable to minority shareholders
VII. Total comprehensive income 401,586,758.24 170,108,993.51
Total comprehensive income attributable to the owners of
401,586,758.24 170,108,993.51
parent company
Total comprehensive income attributable to minority
shareholders
VIII. Earnings per share:
(I) Basic income per share 0.0872 0.0366
(II) Diluted income per share 0.0872 0.0366
In case of business merger under common control in the current period, the net profit realized by the combined
party before the merger and that in the previous period are CNY 0.00.
Legal representative: Hu Hanjie Person in charge of accounting:
Ji Yizhi Person in charge of the accounting organization: Si Yuzhuo
4. Profit Statement of parent company
Unit: CNY
Item Semi-annual 2023 Semi-annual 2022
I. Operating income
Less: operating costs 1,004,509.14 871,274.65
Taxes and surcharges 92,539.45 96,668.40
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Sales expenses
Administrative expenses 609,861.32 793,096.66
R&D expenses
Financial expenses 302,108.37 -18,490.41
Including: interest expenses 369,423.14
Interest income 67,334.77 19,230.41
Add: Other incomes 344,768.40 294,909.01
Investment income (loss to be listed with “-”) 232,563,045.29 292,234,106.00
Including: income from investment in associates and
232,563,045.29 292,234,106.00
joint ventures
Gains on derecognition of financial assets at
amortized cost (loss to be listed with "-")
Net exposure hedging income (loss to be listed with "-")
Profit arising from changes in fair value (loss to be listed
with "-")
Credit impairment loss (loss to be listed with “-”)
Asset impairment loss (loss to be listed with “-”)
Income from assets disposal (loss to be listed with “-”)
II. Operating profit (loss to be listed with "-") 231,903,304.55 291,657,740.36
Add: non-operating income
Less: non-operating expenses
III. Total profit (total (loss to be listed with "-") 231,903,304.55 291,657,740.36
Less: Income tax expenses
IV. Net profit (net loss to be listed with "-") 231,903,304.55 291,657,740.36
(I) Net profit from continuing operations (net loss to be listed
231,903,304.55 291,657,740.36
with "-")
(II) Net profit from discontinuing operations (net loss to be
listed with "-")
V. Net after-tax amount of other comprehensive incomes 254,420.76 -46,736.62
(I) Other comprehensive incomes that cannot be
reclassified into profits or losses
1. Changes arising from re-measurement of the defined
benefit plan
2. Other comprehensive incomes that cannot be
transferred to profits or losses under the equity method
3. Changes in fair value of investment in other equity
instruments
4. Changes in fair value of the Company’s credit risk
5. Others
(II) Other comprehensive incomes that will be reclassified 254,420.76 -46,736.62
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into profits or losses
1. Other comprehensive incomes that can be transferred
254,420.76 -46,736.62
to profits or losses under the equity method
2. Changes in the fair value of other debt investments
3. Amount of financial assets reclassified into other
comprehensive incomes
4. Other debt investment credit impairment provisions
5. Cash flow hedging reserve
6. Translation difference in foreign currency financial
statements
7. Others
VI. Total comprehensive income 232,157,725.31 291,611,003.74
VII. Earnings per share:
(I) Basic income per share
(II) Diluted income per share
5. Consolidated cash flow statement
Unit: CNY
Item Semi-annual 2023 Semi-annual 2022
I. Cash flows from operating activities:
Cash received from sales of goods and provision of services 26,509,677,303.11 22,972,631,458.07
Net increase in customer bank deposits and due to banks and
other financial institutions
Net increase in borrowings from the central bank
Net increase in placements from other financial institutions
Cash from premium of original insurance contract
Net cash received from reinsurance business
Net increase in deposits and investments from policyholders
Cash received from interests, handling charges and
commissions
Net increase in placements from banks and other financial
institutions
Net increase in repurchase business capital
Net cash received from securities brokerage
Tax refunds received 324,144,774.70 1,010,974,954.15
Other cash received relating to operating activities 641,647,622.93 845,166,247.90
Subtotal of cash inflows from operating activities 27,475,469,700.74 24,828,772,660.12
Cash paid for goods and services 16,681,742,834.34 20,189,789,863.19
Net increase in loans and advances to customers
Net increase in deposits with central bank and other financial
institutions
Cash paid for original insurance contract claims
Net increase in loans to banks and other financial institutions
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Cash paid for interests, handling charges and commissions
Cash paid for policyholder dividend
Cash paid to and on behalf of employees 2,351,935,403.71 2,288,542,182.41
Taxes paid 775,864,015.70 70,848,814.67
Cash paid for other operating activities 951,768,069.52 836,454,073.22
Subtotal of cash outflows from operating activities 20,761,310,323.27 23,385,634,933.49
Net cash flows from operating activities 6,714,159,377.47 1,443,137,726.63
II. Cash flows from investment activities:
Cash received from the return of investment
Cash received from acquirement of investment income 11,728,790.64 6,300,012.21
Net cash received from disposal of fixed assets, intangible
3,224,430.67 3,519,331.24
assets and other long-term assets
Net cash received from the disposal of subsidiaries and other
business entities
Cash received from other investment activities 368,529,711.02 441,265,670.20
Subtotal of cash inflows from investment activities 383,482,932.33 451,085,013.65
Cash paid to acquire fixed assets, intangible assets and other
798,231,104.91 1,125,719,469.03
long-term assets
Cash paid to acquire investments 546,943,104.33 0.00
Net increase in pledged loans
Net cash paid to acquire subsidiaries and other business units
Other cash paid relating to investment activities
Subtotal of cash outflows from investment activities 1,345,174,209.24 1,125,719,469.03
Net cash flows from investment activities -961,691,276.91 -674,634,455.38
III. Cash flows from financing activities:
Cash received from absorbing investment
Including: cash received by subsidiaries absorbing minority
shareholders' investments
Cash received from borrowings
Cash received relating to other financing activities
Subtotal of cash inflows from financing activities
Cash paid for repayment of debts
Cash paid for distribution of dividends, profits or interest
3,025,174,498.45
repayment
Including: dividends and profits paid to minority shareholders
by subsidiaries
Other cash paid relating to financing activities 19,709,605.31 15,922,921.74
Subtotal of cash outflows from financing activities 19,709,605.31 3,041,097,420.19
Net cash flows from financing activities -19,709,605.31 -3,041,097,420.19
IV. Effects from change of exchange rate on cash and cash
10,253.58 0.00
equivalents
V. Net increase in cash and cash equivalents 5,732,768,748.83 -2,272,594,148.94
Add: opening balance of cash and cash equivalents 20,697,669,726.18 30,542,676,891.89
VI. Ending Balance of cash and cash equivalents 26,430,438,475.01 28,270,082,742.95
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6. Cash flow statement of parent company
Unit: CNY
Item Semi-annual 2023 Semi-annual 2022
I. Cash flows from operating activities:
Cash received from sales of goods and provision of services
Tax refunds received 735,000.75
Other cash received relating to operating activities 98,280,887.47 3,032,128,468.42
Subtotal of cash inflows from operating activities 98,280,887.47 3,032,863,469.17
Cash paid for goods and services
Cash paid to and on behalf of employees 189,000.00 207,000.00
Taxes paid 96,728.40 96,728.40
Cash paid for other operating activities 97,575,865.50 834,581.41
Subtotal of cash outflows from operating activities 97,861,593.90 1,138,309.81
Net cash flows from operating activities 419,293.57 3,031,725,159.36
II. Cash flows from investment activities:
Cash received from the return of investment
Cash received from acquirement of investment income 4,835,877.87
Net cash received from disposal of fixed assets, intangible assets
and other long-term assets
Net cash received from the disposal of subsidiaries and other
business entities
Cash received from other investment activities 67,334.77 19,230.41
Subtotal of cash inflows from investment activities 4,903,212.64 19,230.41
Cash paid to acquire fixed assets, intangible assets and other long-
term assets
Cash paid to acquire investments
Net cash paid to acquire subsidiaries and other business units
Other cash paid relating to investment activities
Subtotal of cash outflows from investment activities
Net cash flows from investment activities 4,903,212.64 19,230.41
III. Cash flows from financing activities:
Cash received from absorbing investment
Cash received from borrowings
Cash received relating to other financing activities
Subtotal of cash inflows from financing activities
Cash paid for repayment of debts
Cash paid for distribution of dividends, profits or interest repayment 3,025,174,498.45
Other cash paid relating to financing activities
Subtotal of cash outflows from financing activities 3,025,174,498.45
Net cash flows from financing activities -3,025,174,498.45
IV. Effects from change of exchange rate on cash and cash equivalents
V. Net increase in cash and cash equivalents 5,322,506.21 6,569,891.32
Add: opening balance of cash and cash equivalents 4,235,008.50 8,109,077.01
VI. Ending Balance of cash and cash equivalents 9,557,514.71 14,678,968.33
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7. Consolidated statement of changes in owners' equity
Amount in the current period Unit: CNY
Semi-annual 2023
Equity Attributable To Owners Of The Parent Company
Item Other equity Instruments Minority Total Owners'
Other General
Capital Less: Treasury Special Surplus Undistributed Equity Equity
Share Capital Preferred Perpetual Comprehensive Risk Others Subtotal
Others Reserves Shares Reserves Reserves Profits
Shares Bond Incomes Provision
I. Ending
4,651,965,655. 10,451,088,236 267,837,184.1 370,420,291. 3,058,249,60 5,460,939,601.3 23,719,427,08 23,719,427,082.4
Balance of the -5,399,120.81
00 .74 1 86 2.44 6 2.48 8
previous year
Add:
changes in
accounting
policies
Correcti
on of prior
period errors
Business
merger under
common control
Others
II. Opening
4,651,965,655. 10,451,088,236 267,837,184.1 370,420,291. 3,058,249,60 5,460,939,601.3 23,719,427,08 23,719,427,082.4
Balance of the -5,399,120.81
00 .74 1 86 2.44 6 2.48 8
current year
III.
Increase/decreas
e in amount of
- - 407,612,936.8
the current -14,633,325.00 -70,430,027.93 250,455.89 401,336,302.35 407,612,936.87
92,539,863.27 1,450,331.71 7
period (decrease
to be listed with
"-")
(I) Total
401,586,758.2
comprehensive 250,455.89 401,336,302.35 401,586,758.24
4
income
(II) Invested and
decreased -
-14,633,325.00 -70,430,027.93 7,476,510.34 7,476,510.34
capital of 92,539,863.27
owners
1. Ordinary -14,633,325.00 -77,906,538.27 -92,539,863.27 -92,539,863.27
shares invested
80
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by owners
2. Capital
contributed by
holders of other
equity
instruments
3. Amounts of
share-based
payments 7,500,283.02 7,500,283.02 7,500,283.02
recorded in
owner's equity
-
4. Others -23,772.68 92,516,090.59 92,516,090.59
92,539,863.27
(III) Profit
distribution
1. Appropriation
to surplus
reserves
2. Appropriation
to general risk
reserves
3. Distribution
to owners (or
shareholders)
4. Others
(IV) Internal
carryover of
owners' equity
1. Transfer from
capital reserve
to paid-in
capital (or share
capital)
2. Transfer from
surplus reserves
to paid-in
capital (or share
capital)
3. Recovery of
losses by
surplus reserves
4. Retained
earnings carried
81
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forward from
changes in
defined benefit
plans
5. Retained
earnings carried
forward from
other
comprehensive
income
6. Others
(V) Special -
-1,450,331.71 -1,450,331.71
reserves 1,450,331.71
1. Appropriation
15,046,812.4
in the current 15,046,812.40 15,046,812.40
0
period
-
2. Use in the
16,497,144.1 -16,497,144.11 -16,497,144.11
current period
1
(VI) Others
IV. Ending
4,637,332,330. 10,380,658,208 175,297,320.8 368,969,960. 3,058,249,60 5,862,275,903.7 24,127,040,01 24,127,040,019.3
Balance of the -5,148,664.92
00 .81 4 15 2.44 1 9.35 5
current period
Amount of the previous year Unit: CNY
Semi-annual 2022
Equity Attributable To Owners of the Parent Company
Item Other Equity Instruments Minority Total Owners'
Other General
Capital Less: Treasury Special Surplus Undistributed Equity Equity
Share Capital Preferred Perpetual Comprehensive Risk Others Subtotal
Others Reserves Shares Reserves Reserves Profits
Shares Bond Incomes Provision
I. Ending 10,439,3
4,654,114,613.0 310,460,486.3 315,398,148. 2,742,214,904.8 8,434,403,35 26,242,240,723. 26,242,240,723.
Balance of the 65,093.1 -32,794,902.20
0 8 75 3 2.08 26 26
previous year 8
Add:
changes in
accounting
policies
82
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Correc
tion of prior
period errors
Business
merger under
common control
Others
II. Opening 10,439,3
4,654,114,613.0 310,460,486.3 315,398,148. 2,742,214,904.8 8,434,403,35 26,242,240,723. 26,242,240,723.
Balance of the 65,093.1 -32,794,902.20
0 8 75 3 2.08 26 26
current year 8
III.
Increase/decreas
e in amount of - - -
30,324,0 - 41,930,677.8
the current -44,893.81 2,855,020,61 2,753,919,335.2 2,753,919,335.2
31.20 28,891,460.65 6
period (decrease 1.13 3 3
to be listed with
"-")
(I) Total
170,153,887.
comprehensive -44,893.81 170,108,993.51 170,108,993.51
32
income
(II) Invested and
decreased 30,324,0 -
59,215,491.85 59,215,491.85
capital of 31.20 28,891,460.65
owners
1. Ordinary
shares invested
by owners
2. Capital
contributed by
holders of other
equity
instruments
3. Amounts of
83
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share-based
payments
recorded in
owner's equity
30,324,0 -
4. Others 59,215,491.85 59,215,491.85
31.20 28,891,460.65
- - -
(III) Profit
3,025,174,49 3,025,174,498.4 3,025,174,498.4
distribution
8.45 5 5
1. Appropriation
to surplus
reserves
2. Appropriation
to general risk
reserves
3. Distribution - - -
to owners (or 3,025,174,49 3,025,174,498.4 3,025,174,498.4
shareholders) 8.45 5 5
4. Others
(IV) Internal
carryover of
owners' equity
1. Transfer from
capital reserve
to paid-in
capital (or share
capital)
2. Transfer from
surplus reserves
to paid-in
capital (or share
capital)
84
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3. Recovery of
losses by
surplus reserves
4. Retained
earnings carried
forward from
changes in
defined benefit
plans
5. Retained
earnings carried
forward from
other
comprehensive
income
6. Others
(V) Special 41,930,677.8
41,930,677.86 41,930,677.86
reserves 6
1. Appropriation
53,753,366.4
in the current 53,753,366.46 53,753,366.46
6
period
2. Use in the 11,822,688.6
11,822,688.60 11,822,688.60
current period 0
(VI) Others
IV. Ending 10,469,6
4,654,114,613.0 281,569,025.7 357,328,826. 2,742,214,904.8 5,579,382,74 23,488,321,388. 23,488,321,388.
Balance of the 89,124.3 -32,839,796.01
0 3 61 3 0.95 03 03
current period 8
85
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8. Statement of Changes in Owners' Equity of Parent Company
Amount in the current period
Unit: CNY
Semi-annual 2023
Other Equity Instruments Other
Item Less: Treasury Special Undistributed
Share Capital Preferred Perpetual Capital Reserves Comprehensive Surplus Reserves Others Total Owners' Equity
Others Shares Reserves Profits
Shares Bond Incomes
I. Ending
Balance of the 4,651,965,655.00 12,278,939,213.88 267,837,184.11 -480,794.77 1,827,531,841.54 6,793,780,964.90 25,283,899,696.44
previous year
Add:
changes in
accounting
policies
Correctio
n of prior period
errors
Others
II. Opening
Balance of the 4,651,965,655.00 12,278,939,213.88 267,837,184.11 -480,794.77 1,827,531,841.54 6,793,780,964.90 25,283,899,696.44
current year
III.
Increase/decrease
in amount of the
-14,633,325.00 -77,906,538.27 -92,539,863.27 254,420.76 231,903,304.55 232,157,725.31
current period
(decrease to be
listed with "-")
(I) Total
comprehensive 254,420.76 231,903,304.55 232,157,725.31
income
(II) Invested and
-14,633,325.00 -77,906,538.27 -92,539,863.27 0.00
decreased capital
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of owners
1. Ordinary
shares invested -14,633,325.00 -77,906,538.27 -92,539,863.27
by owners
2. Capital
contributed by
holders of other
equity
instruments
3. Amounts of
share-based
payments
recorded in
owner's equity
4. Others -92,539,863.27 92,539,863.27
(III) Profit
distribution
1. Appropriation
to surplus
reserves
2. Distribution to
owners (or
shareholders)
3. Others
(IV) Internal
carryover of
owners' equity
1. Transfer from
capital reserve to
paid-in capital
(or share capital)
2. Transfer from
surplus reserves
to paid-in capital
(or share capital)
87
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3. Recovery of
losses by surplus
reserves
4. Retained
earnings carried
forward from
changes in
defined benefit
plans
5. Retained
earnings carried
forward from
other
comprehensive
income
6. Others
(V) Special
reserves
1. Appropriation
in the current
period
2. Use in the
current period
(VI) Others
IV. Ending
Balance of the 4,637,332,330.00 12,201,032,675.61 175,297,320.84 -226,374.01 1,827,531,841.54 7,025,684,269.45 25,516,057,421.75
current period
88
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Amount of the previous year
Unit: CNY
Semi-annual 2022
Other Equity Instruments Other
Item Less: Treasury Special Undistributed
Share Capital Preferred Perpetual Capital Reserves Comprehensive Surplus Reserves Others Total Owners' Equity
Others Shares Reserves Profits
Shares Bond Incomes
I. Ending
Balance of the 4,654,114,613.00 12,267,337,664.44 310,460,486.38 304,113.31 1,511,497,143.93 6,974,643,184.91 25,097,436,233.21
previous year
Add:
changes in
accounting
policies
Correct
ion of prior
period errors
Others
II. Opening
Balance of the 4,654,114,613.00 12,267,337,664.44 310,460,486.38 304,113.31 1,511,497,143.93 6,974,643,184.91 25,097,436,233.21
current year
III.
Increase/decrease
in amount of the
-28,891,460.65 -46,736.62 -2,733,516,758.09 -2,704,672,034.06
current period
(decrease to be
listed with "-")
(I) Total
comprehensive -46,736.62 291,657,740.36 291,611,003.74
income
(II) Invested and
decreased capital -28,891,460.65 28,891,460.65
of owners
1. Ordinary
shares invested
89
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by owners
2. Capital
contributed by
holders of other
equity
instruments
3. Amounts of
share-based
payments
recorded in
owner's equity
4. Others -28,891,460.65 28,891,460.65
(III) Profit
-3,025,174,498.45 -3,025,174,498.45
distribution
1. Appropriation
to surplus
reserves
2. Distribution to
owners (or -3,025,174,498.45 -3,025,174,498.45
shareholders)
3. Others
(IV) Internal
carryover of
owners' equity
1. Transfer from
capital reserve to
paid-in capital
(or share capital)
2. Transfer from
surplus reserves
to paid-in capital
(or share capital)
3. Recovery of
losses by surplus
reserves
90
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4. Retained
earnings carried
forward from
changes in
defined benefit
plans
5. Retained
earnings carried
forward from
other
comprehensive
income
6. Others
(V) Special
reserves
1. Appropriation
in the current
period
2. Use in the
current period
(VI) Others
IV. Ending
Balance of the 4,654,114,613.00 12,267,337,664.44 281,569,025.73 257,376.69 1,511,497,143.93 4,241,126,426.82 22,392,764,199.15
current period
91
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III. Company Profile
1. Overview
FAW JIEFANG GROUP CO., LTD., formerly known as FAW Car Co., Ltd., is a limited liability company
registered in Changchun City, Jilin Province.
FAW Car was approved by TGS [1997] No. 55 Document of the State Commission for Restructuring the
Economic Systems in 1997 and established exclusively by CHINA FAW GROUP CO., LTD. On June 18, 1997,
FAW Car was approved by the China Securities Regulatory Commission to issue shares publicly and listed on
the Shenzhen Stock Exchange for circulation.
On April 9, 2012, FAW Group invested 862,983,689 shares of FAW Car into FAW as its capital contribution,
and received the Confirmation of Securities Transfer Registration issued by China Securities Depository &
Clearing Co., Ltd. Shenzhen Branch on the same day.
On November 28, 2019, FAW Car held the 10th meeting of the 8th Board of Directors, and reviewed and
approved the adjustment plan for major asset restructuring. After the adjustment, FAW Car transferred all its
assets and liabilities except the equity and some reserved assets of First Automobile Finance Co., Ltd. and
Sanguard Automobile Insurance Co., Ltd. to FAW Bestune, and then replaced 100% equity of FAW Bestune
Car Co., Ltd. with the equivalent part of 100% equity of FAW Jiefang Automotive Co., Ltd. held by FAW. At
the same time, FAW Car purchased the difference between the purchased assets and the sold assets from FAW
by issuing shares and paying cash.
On March 12, 2020, FAW Car received the Reply on Approving the Major Asset Restructuring of FAW Car Co.,
Ltd. and Issuing Shares to China FAW Co., Ltd. for Asset Purchase (ZJXK [2020] No. 352) issued by the China
Securities Regulatory Commission, and China Securities Regulatory Commission reviewed and approved the
major asset replacement, share issuance and cash payment for assets purchase and related transactions of FAW
Car.
The Capital Verification Report (XYZH/2020BJA100417) issued by ShineWing Accounting Firm (special
general partnership) indicates that, as of March 19, 2020, all proposed purchased assets, i.e., 100% equity of
Jiefang Limited, to be replaced by FAW Car to FAW by issuing shares had been transferred to FAW Car. The
industrial and commercial change registration procedures of Jiefang Limited had been completed, all proposed
assets, i.e., 100% equity of FAW Bestune, had been transferred to FAW, and the industrial and commercial
change registration procedures of FAW Bestune had been completed. The registered capital of FAW Car is
CNY 4,609,666,212.00 after this change.
92
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In May 2020, the name of FAW Car was changed to "FAW JIEFANG GROUP CO., LTD." and the stock
abbreviation was changed to "FAW Jiefang".
On January 11, 2021, the Company held the first 2021 extraordinary shareholders' meeting, and reviewed and
approved the Proposal on the Restricted Share Incentive Plan of FAW Jiefang Group Co., Ltd. (Draft) and Its
Abstract, the Proposal on the Regulations for the Implementation Assessment of Restricted Share Incentive Plan
of FAW Jiefang Group Co., Ltd., the Proposal on the Regulations for Restricted Share Incentive of FAW
Jiefang Group Co., Ltd., and the Proposal on Requesting the Shareholders Meeting to Authorize the Board of
Directors to Handle Matters Related to the Company's Restricted Share Incentive Plan. On January 15, 2021,
the Company held the 12th meeting of the 9th Board of Directors, and reviewed and approved the Proposal on
Adjusting the List of the First Batch of Incentive Objects and the Number of Grants in the Phase I Restricted
Share Incentive Plan and the Proposal on Granting Restricted Shares to the Incentive Objects of the Phase I
Restricted Share Incentive Plan for the First Time. Nine directors and senior executives, including Hu Hanjie,
Zhu Qixin, Zhang Guohua, Wang Ruijian, Shang Xingwu, Ou Aimin, Kong Dejun, Wu Bilei and Wang Jianxun,
and 310 other core employees with the title of senior director and above were granted to subscribe for
40,987,657 new shares of the Company at an issue price of CNY 7.54 per share, and the registered capital of the
Company was changed to CNY 4,650,653,869.00. This change was verified by the Capital Verification Report
(ZTYZ (2021) No. 110C000033) issued by Grant Thornton Accounting Firm (special general partnership). On
February 1, 2021, the Company disclosed the Announcement on the Completion of the First Grant Registration
of Phase I Restricted Share Incentive Plan.
On December 9, 2021, the Company held the 20th meeting of the 9th Board of Directors and the 19th meeting of
the 9th Board of Supervisors, and reviewed and approved the Proposal on Granting Reserved Part of Restricted
Shares in the Phase I Restricted Share Incentive Plan to Incentive Objects and the Proposal on Repurchase and
Cancellation of Partial Restricted Shares in the Phase I Restricted Share Incentive Plan respectively. Thirty-
three core technicians and management backbones, including Wang Manhong, Zhang Yu and Qu Yi, subscribed
for 3,721,601 new shares at an issue price of CNY 6.38/share, and 260,857 shares were repurchased at a price
of CNY 7.04/share from 2 employees who were no longer eligible for incentive objects. The registered capital
of the Company was changed to CNY 4,654,114,613.00. This change was verified by the Capital Verification
Report (ZTYZ (2021) No. 110C000927) issued by Grant Thornton Accounting Firm (special general
partnership). On January 6, 2022, the Company disclosed the Announcement on the Completion of Registration
of the Grant of Reserved Part of Restricted Shares in the Phase I Restricted Share Incentive Plan. On January
17, 2022, the Company disclosed the Announcement on the Completion of Repurchase and Cancellation of
Some Restricted Shares.
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On August 29, 2022, the Company held the 26th meeting of the 9th Board of Directors and the 23rd meeting of
the 9th Board of Supervisors, and reviewed and approved the Proposal on Repurchase and Cancellation of
Partial Restricted Shares in the Phase I Restricted Share Incentive Plan. It was agreed to repurchase 789,711
shares at a price of CNY 6.39/share from 6 employees who are no longer qualified as incentive objects, and the
registered capital of the Company was changed to CNY 4,653,324,902.00. This change was verified according
to the Capital Verification Report (XYZH/2022CCAA2B0016) issued by ShineWing Accounting Firm (special
general partnership). On November 14, 2022, the Company disclosed the Announcement on Completion of
Repurchase and Cancellation of Some Restricted Shares.
On October 28, 2022, the Company held the 28th meeting of the 9th Board of Directors and the 24th meeting of
the 9th Board of Supervisors, and reviewed and approved the Proposal on Repurchase and Cancellation of
Partial Restricted Shares in the Phase I Restricted Share Incentive Plan, and agreed to repurchase 1,359,247
shares at a price of CNY 6.39/share from 11 employees who are no longer qualified as incentive objects. The
registered capital of the Company was changed to CNY 4,651,965,655.00. This change was verified according
to the Capital Verification Report (XYZH/2023CCAA2B0001) issued by ShineWing Accounting Firm (special
general partnership). On January 17, 2023, the Company disclosed the Announcement on Completion of
Repurchase and Cancellation of Some Restricted Shares.
On December 15, 2022, the Company held the 30th meeting of the 9th Board of Directors and the 26th meeting of
the 9th Board of Supervisors, and reviewed and approved the Proposal on Repurchase and Cancellation of
Partial Restricted Shares in the Phase I Restricted Share Incentive Plan, and agreed to repurchase 723,435
shares at a price of CNY 6.39/share or 5.73/share from 6 employees who are no longer qualified as incentive
objects. The registered capital of the Company was changed to CNY 4,651,242,220. This change was verified
according to the Capital Verification Report (XYZH/2023CCAA2B0103) issued by ShineWing Accounting
Firm (special general partnership). On April 28, 2023, the Company disclosed the Announcement on
Completion of Repurchase and Cancellation of Some Restricted Shares.
On March 31, 2023, the Company held the 32nd Meeting of the 9th Board of Directors and the 28th Meeting of
the 9th Board of Supervisors to deliberate and approve the Proposal on Unsuccessful Lifting of Conditions of the
Second Release Period First Granted by the Phase I Restricted Share Incentive Plan for Releasing the
Restricted Sales and of Conditions of the First Release Period Reserved by the Phase I Restricted Share
Incentive Plan for Releasing the Restricted Sales and Repurchase and Write-off of Some Restricted Shares,
agreeing to repurchase 13,909,890 shares from 327 employees no longer qualified as incentive objects at a price
of CNY 6.39/share or CNY 5.73/share respectively. The registered capital of the Company is changed to CNY
4,637,332,330. This change was verified according to the Capital Verification Report
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(XYZH/2023CCAA2B0175) issued by ShineWing Accounting Firm (special general partnership). On June 30,
2023, the Company disclosed the Announcement on Completion of Repurchase and Cancellation of Some
Restricted Shares.
The Company establishes a corporate governance structure consisting of the Shareholders' Meeting, the Board
of Directors and the Board of Supervisors, and has one wholly-owned subsidiary, Jiefang Limited. Jiefang
Limited has five wholly-owned subsidiaries, including FAW Jiefang (Qingdao) Automotive Co., Ltd., Wuxi
Dahao Power Co., Ltd., FAW Jiefang Dalian Diesel Engine Co., Ltd., FAW Jiefang Austria R&D Co., Ltd., and
FAW Jiefang New Energy Automotive Sales Co., Ltd. It also has 11 associated companies, including First
Automobile Finance Co., Ltd., Sanguard Automobile Insurance Co., Ltd., Changchun Baoyou Jiefang Steel
Processing and Distribution Co., Ltd., FAW Changchun Ansteel Steel Processing and Distribution Co., Ltd.,
Changchun Wabco Automotive Control System Co., Ltd., Suzhou Zhito Technology Co., Ltd., Jiefang Fujie
(Tianjin) Science and Technology Industry Co., Ltd., Yukuai Chuangling Intelligent Technology (Nanjing) Co.,
Ltd., Foshan Diyi Element New Energy Technology Co., Ltd., Jiefang Times New Energy Technology Co., Ltd.,
and Changchun Automotive Test Center Co., Ltd.
Business scope of the Company: R&D, production and sales of medium and heavy trucks, vehicles, buses, bus
chassis, medium truck deformation vehicles, automobile assemblies and parts, machining, diesel engines and
accessories (non-vehicle), mechanical equipment and accessories, instruments, technical services, technical
consultation, installation and maintenance of mechanical equipment, lease of mechanical equipment and
facilities, lease of houses and workshops, labor services (excluding foreign labor cooperation and domestic
labor dispatch), sales of steel, automobile trunks, hardware & electrical equipment and electronic products,
testing of internal combustion engine, engineering technology research and testing, advertising design,
production and release, import and export of goods and technologies (excluding publication import business and
commodities and technologies restricted or prohibited for import and export by the state); (the following items
are operated by the branch company) Chinese food production and sales, warehousing and logistics (excluding
flammable, explosive and precursor dangerous chemicals), automobile repair, tank manufacturing of chemical
liquid tanker, automobile trunk manufacturing (items subject to approval according to law can be operated only
after being approved by relevant authorities).
Registered address of the Company: No. 2259, Dongfeng Street, Changchun Automobile Development Zone,
Jilin Province.
The legal representative of the Company is Hu Hanjie.
The financial statements and notes to the financial statements were approved for issue by the Board of Directors
of the Company on August 29, 2023.
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2. Scope of Consolidated Financial Statements
During the reporting period, the Company has 1 secondary subsidiary and 6 tertiary subsidiaries included in the
scope of consolidation. For details, please refer to VIII "Changes in Consolidation Scope" and IX "Equity in
Other Entities" of Section X - Financial Report.
IV. Basis of Preparation for Financial Statements
1. Preparation basis
The financial statements are prepared according to the Accounting Standards for Business Enterprises issued by
the Ministry of Finance and its application guidelines, interpretations and other relevant provisions (hereinafter
collectively referred to as "ASBE"). In addition, the Company also discloses relevant financial information
according to the Disclosure of Company Information Disclosure Rules No. 15. - General Provisions on
Financial Reporting (revised in 2014) issued by China Securities Regulatory Commission.
2. Continuing operations
The financial statements are presented on continuing operations.
The financial accounting of the Company is based on the accrual basis. The financial statements are prepared on
a historical cost basis except for certain financial instruments. If the assets are impaired, the corresponding
impairment provision shall be made as specified.
V. Significant Accounting Policies and Accounting Estimates
Tips for specific accounting policies and accounting estimates:
The Company determines the depreciation of fixed assets, amortization of intangible assets, capitalization
conditions of R&D expenses and income recognition policies according to its own production and operation
characteristics. For specific accounting policies, please see 22, 25 and 33 in V "Significant Accounting Policies
and Accounting Estimates" in Section X - Financial Report.
1. Statement of compliance with accounting standards for business enterprises
The financial statements prepared by the Company met the requirements of ASBE and truly and fully reflected
the consolidated and company’s financial position of the Company as of June 30, 2023, and information such as
consolidated and company’s operating results and consolidated and company’s cash flow for 2023 H1.
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2. Accounting period
The accounting period of the Company is a calendar year, namely, from January 1 to December 31 every year.
3. Operating cycle
The operating cycle of the Company is 12 months.
4. Recording currency
The Company and its domestic subsidiaries use CNY as their recording currency. The overseas subsidiaries of
the Company determine EUR as the recording currency according to the currency in the main economic
environment in which they operate. The Company uses CNY to prepare the financial statements.
5. Accounting treatment method for business merger under common control and different control
(1) Business merger under common control
As to the business merger under common control, the assets and liabilities of the combined party obtained by
the combining party are calculated in the book value in the consolidated financial statements of the ultimate
controller by the combined party on the combination date. The capital reserve (stock premium) is adjusted
based on the difference between the book value of the combination consideration and the book value of the net
assets obtained in the combination. The retained earnings are adjusted if the capital reserve (stock premium) is
insufficient for offset.
Business merger under common control realized step-by-step through multiple transactions
In individual financial statements, the share of book value of the combined party's net assets in the consolidated
financial statements of the ultimate controlling party on the combination date calculated based on the
shareholding proportion on the combination date is taken as the initial cost of the investment. The capital
reserve (stock premium) is adjusted based on the difference between the initial investment cost and the sum of
the book value of the pre-combination investment and the book value of the newly paid consideration on the
combination date, and the retained earnings are adjusted if the capital reserve is insufficient for offset.
In the consolidated financial statements, the assets and liabilities of the combined party obtained by the
combining party in the combination are measured based on the book value of the ultimate controlling party in
the consolidated financial statements on the combination date. The capital reserve (stock premium) is adjusted
based on the difference between the sum of the book value of the pre-combination investment and the book
value of the newly paid consideration on the combination date and the book value of the net assets obtained in
the combination. The retained earnings are adjusted if the capital reserve is insufficient for offset. The long-term
equity investment held before the acquisition of the combined party’s control by the combining party and the
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profit or loss, other comprehensive incomes and changes in other owners’ equities that have been recognized
during the period from the date of acquisition of the original equity, or the date of common control of the
combining party and the combined entity (which is later) to the combination date shall offset against the
retained opening earnings or current profit or loss respectively during the period of comparative statement.
(2) Business merger under different control
In case of business merger under different control, the combination cost is the fair value of assets paid,
liabilities incurred or assumed and equity securities issued on the acquisition date for acquiring the control over
the acquiree. The assets, liabilities and contingent liabilities of the acquiree obtained are recognized as per the
fair value on the acquisition date.
Where the combination cost is greater than the fair value of identifiable net assets obtained from the acquiree,
the difference shall be recognized as goodwill and subsequently measured by deducting the accumulated
depreciation provision by cost; Where the combination cost is less than the fair value of identifiable net assets
obtained from the acquiree, the difference shall be included in current profits and losses after review.
Business merger not under common control realized step-by-step through multiple transactions
In the separate financial statement, the sum of the book value of the equity investment of the acquiree held
before the acquisition date and the new investment cost on the acquisition date shall be recognized as the initial
investment cost for this investment. For other comprehensive incomes from original equity investments
recognized by the equity method before the purchase date, they are not disposed of. This investment is disposed
of on the same basis as the investee directly disposing of related assets and liabilities. The owners’ equity
recognized due to changes in other owners’ equities of the investee other than net profit or loss, other
comprehensive incomes and profit distribution, are transferred into the current profits or losses when this
investment is disposed of. If the equity investment held before the acquisition date is measured at fair value, the
accumulated changes in fair value originally included in other comprehensive income are transferred to retained
earnings when the cost method is adopted for calculation.
In the consolidated financial statements, the combination cost is the sum of the consideration paid on the
acquisition date and the fair value of the acquiree's equity has already held before the acquisition date on the
acquisition date. The acquiree's equity held before the acquisition date shall be remeasured at fair value of the
equity on the acquisition date. The difference between the fair value and its book value shall be included in
investment income for the current period. If the acquiree's equity held before the acquisition date involves other
comprehensive income, changes in other owner's equities shall be transformed into the current profit on the
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acquisition date, except for other comprehensive incomes generated due to remeasuring the change in net
liabilities or new assets of defined benefit plan by the investee.
(3) Disposal of related handling charges for business merger
The overhead for the business merger of the combining party, including the expenses for audit, legal services,
assessment, and other administrative expenses, shall be recorded in current profits and losses when they occur.
The transaction expenses of the equity securities or liability securities issued as the consideration for the
combination shall be recorded as the initial recognition amount of the equity securities or liability securities.
6. Preparation methods of consolidated financial statements
(1) Consolidation scope
The scope of consolidated financial statements is determined on the basis of control. Control refers to the power
of the Company over the investee, with which the Company enjoys variable returns through participating in
related activities of the investee and is able to influence its amount of return with the power over the investee.
Subsidiaries refer to entities controlled by the Company (including enterprises, separable parts of investees,
structured entities, etc.)
(2) Preparation methods of consolidated financial statements
The consolidated financial statements are prepared by the Company based on the financial statements of the
Company and its subsidiaries and with other relevant data. The major accounting policies and accounting
periods adopted by the subsidiaries are defined as the same as those of the Company during the preparation of
the consolidated financial statements. The significant transactions and balances between companies are offset.
Where a subsidiary or business has been acquired through a business merger involving enterprises under
common control in the reporting period, the subsidiary or business is deemed to be included in the consolidated
financial statements from the date they are controlled by the ultimate controlling party. Their operating results
and cash flows are respectively included in the consolidated income statement and consolidated cash flow
statement from the date they are controlled by the ultimate controlling party.
For the subsidiaries and businesses increased in the reporting period due to business merger under different
control, their earnings, expenses and profits from the acquisition date to the end of the reporting period are
included in the consolidated profit statement, and their cash flows are included in the consolidated cash flow
statement.
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The portion of shareholders’ equity of subsidiaries not belonging to the Company shall be listed separately
under the item “Shareholders’ Equity” in consolidated balance sheet as minority shareholders’ equity. The
portion of net profit or loss of subsidiaries in current period belonging to minority shareholders’ equity shall be
listed separately under the item “Minority Shareholders’ Profit or Loss” in the consolidated income statement. If
the loss of a subsidiary borne by minority shareholders exceeds the amount of their shares of owners' equity in
the subsidiary at the beginning, the balance shall offset the minority equity.
(3) Purchase of minority shareholders' equity in subsidiaries
The capital reserve (stock premium) in the consolidated balance sheet is adjusted based on the difference
between the newly acquired long-term equity investment cost from the purchase of minority equity and the
share of net assets in the subsidiary calculated constantly from the purchase date or combination date as per the
newly increased shareholding proportion, and the difference between the disposal price obtained from the
partial disposal of equity investment in the subsidiary without losing the right of control and the share of net
assets in the subsidiary calculated continuously from the purchase date or combination date corresponding to
the disposed long-term equity investment. The retained earnings are adjusted if the capital reserve is insufficient
for offset.
(4) Disposal of the loss of control over subsidiaries
If the control power on the original subsidiaries is lost due to the disposal of part of equity investment or other
reasons, the remaining equity shall be recalculated at fair value on the day when the control power is lost. The
balance from the sum of consideration obtained from the disposal of equity and the fair value of the remaining
equity minus the sum of the share of net assets book value and the goodwill of original subsidiaries calculated
continuously starting from the purchase date as per the original shareholding ratio shall be included in current
investment income at the loss of control.
Other comprehensive income in connection with the equity investment of the original subsidiaries shall be
transferred into current profit or loss at the time of loss of control, except for other comprehensive incomes
generated due to remeasuring the change in net liabilities or new assets of defined benefit plan by the investee.
7. Classification of Joint Venture Arrangement and Accounting Treatment Methods for Joint
Operations
Joint arrangement refers to an arrangement jointly controlled by two or more participants. Joint arrangements of
the Company include joint operations and joint ventures.
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(1) Joint operation
Joint operation refers to the joint arrangement in which the Company enjoys related assets and bears related
liabilities.
The Company recognizes the following items related to the interest share in the joint operation and carries out
accounting according to the ASBE:
A. Recognizing the assets held separately and the assets held jointly as per its shares;
B. Recognizing the liabilities borne separately and the liabilities borne jointly according to its shares;
C. Recognizing the income generated from the sale of shares enjoyed in the joint operation;
D. Recognizing the income generated from the sale of shares enjoyed in the joint operation as per its shares;
E. Recognizing the expenses incurred separately and the expenses arising from joint operation as per its
shares.
(2) Joint ventures
Joint venture refers to a joint arrangement in which the Company only has power over the net assets of the
arrangement.
The Company conducts accounting for the investment of joint ventures according to provisions of the equity
method accounting for long-term equity investments.
8. Standards for recognition of cash and cash equivalents
Cash refers to the cash on hand and the deposits that are readily available for payment. Cash equivalents refer to
the short-term and highly liquid investments held by the Company that are readily convertible into known
amounts of cash and with low risk in value change.
9. Foreign currency transaction and foreign currency statement translation
(1) Foreign currency transaction
Foreign currency transactions of the Company are converted into the amount in recording currency at the
exchange rate determined by systematic and reasonable methods.
On the balance sheet date, the foreign currency monetary items are converted at the spot exchange rate on the
balance sheet date. The exchange difference arising from the difference between the spot exchange rate on the
balance sheet date and the spot exchange rate at the time of initial recognition or on the previous balance sheet
date is included in current profits and losses. Foreign currency non-monetary items measured at historical cost
are still converted at the spot exchange rate on the transaction date. Foreign currency non-monetary items
measured at fair value are converted at the spot exchange rate on the date when the fair value is determined. The
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difference between the converted recording currency amount and the original recording currency amount is
included in current profits and losses or other comprehensive income according to the nature of the non-
monetary items.
(2) Translation of foreign currency financial statements
At the balance sheet date, when the foreign currency financial statements of overseas subsidiaries are translated,
the assets and liabilities of the balance sheet are translated to CNY using the spot exchange rate at the balance
sheet date. Items of the shareholders’ equity, except for “undistributed profits”, are translated at the spot
exchange rate at the dates on which such items arose.
The income and expense items in the profit statement are translated at the exchange rate determined by
systematic and reasonable methods.
All items in the cash flow statement are translated at the exchange rate determined by systematic and reasonable
methods. As an adjustment item for influence amount of cash, exchange rate movement is independently
presented as "Influence of exchange rate movement to cash and cash equivalent" in cash flow statement.
Differences arising from the translation of financial statements are separately presented as “Other
comprehensive income” in the shareholders’ equity of the balance sheet.
During the disposal of overseas operation and upon the loss of the right of control, the conversion difference of
foreign currency statements listed under the shareholders' equity items in the balance sheet and related to the
overseas operation is transferred to the current profits and losses of disposal in full or as per the disposal
proportion of the overseas operation.
10. Financial instruments
Financial instruments refer to contracts that form the financial assets of a party, and form financial liabilities or
equity instruments of other parties.
(1) Recognition and derecognition of the financial instruments
The Company recognizes a financial asset or financial liability when it becomes a party to the contract of the
financial instrument.
If one of the following conditions is met, the financial assets are terminated:
① The contractual right to receive the cash flow of the financial asset is terminated.
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② The financial asset has been transferred and is in accordance with the following conditions for
derecognition.
If the current obligations of financial liability have been discharged in total or in part, derecognize all or part of
it. The Company (the Debtor) signs an agreement with the Creditor to replace the existing financial liabilities
with new financial liabilities; the existing financial liabilities are derecognized and the new financial liabilities
are recognized when the contractual terms of the new financial liabilities and those of the existing financial
liabilities are different in essence.
Financial assets transacted in a conventional way are subject to accounting recognition and derecognition on the
transaction date.
(2) Classification and measurement of financial assets
The Company classifies financial assets into the following three categories according to the business mode of
financial assets management and the contractual cash flow characteristics of financial assets at the time of initial
recognition: financial assets measured at amortized cost, financial assets measured at fair value with their
changes included in other comprehensive income, and financial assets measured at fair value with their changes
included in the current profits or losses.
Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions but are not designated to be
measured at fair value and with the changes included in current profits or losses as the financial assets measured
at amortized cost:
The Company manages the financial assets in order to collect contractual cash flows;
The contract terms of the financial assets stipulate that the cash flow generated on a specific date is
only the payment of the principal and the interest based on the outstanding principal amount.
After initial recognition, such financial assets are measured at amortized cost using the effective interest method.
Any gains or losses on financial assets at amortized cost that are not part of the hedging relationship are charged
to the current profit or loss at derecognition, amortization using the effective interest method, or recognition of
impairment.
Financial assets measured at fair value with their changes included in other comprehensive income
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The Company classifies financial assets that meet the following conditions and are not designated to be
financial assets at fair value with their changes included in current profit or loss as financial assets at fair value
with their changes included in other comprehensive incomes:
The Company manages the financial assets in order not only to collect contractual cash flows but also
to sell the financial assets;
The contract terms of the financial assets stipulate that the cash flow generated on a specific date is
only the payment of the principal and the interest based on the outstanding principal amount.
After initial recognition, such financial assets are subsequently measured at fair value. Interests, impairment
losses or gains and exchange gains and losses calculated with the effective interest method are included in the
current profits and losses, and other gains or losses are included in other comprehensive income. When the
financial assets are derecognized, the accumulated profits or losses previously included in other comprehensive
income are transferred out and included in the current profits and losses.
Financial assets at fair value through profit or loss
Except for the above-mentioned financial assets measured at amortized cost and fair value through other
comprehensive income, the Company classifies all remaining financial assets as financial assets measured at
fair value through profit or loss. At the time of initial recognition, in order to eliminate or significantly reduce
accounting mismatch, the Company irrevocably designates some financial assets that should be measured at
amortized cost or fair value through other comprehensive income as financial assets measured at fair value
through current profits and losses.
After initial recognition, such financial assets are subsequently measured at fair value, and the gains or losses
(including interest and dividend income) incurred are included in current profits and losses unless they are part
of a hedging relationship.
The business model of managing financial assets refers to how the Company manages financial assets to
generate cash flows. The business model determines whether the cash flow of financial assets managed by the
Company comes from collecting contractual cash flows, selling financial assets, or both. The Company
determines the business model for managing financial assets on the basis of objective facts and specific business
objectives for managing financial assets decided by key management personnel.
The Company evaluates the contractual cash flow characteristics of financial assets to determine whether the
contractual cash flow generated by relevant financial assets on a specific date is only the payment of principal
and interest based on the outstanding principal amount. Principal refers to the fair value of financial assets at
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initial recognition; interest includes consideration for the time value of money, credit risk associated with the
amount of principal outstanding over a specific period, and other underlying borrowing risks, costs and profits.
In addition, the Company evaluates the contract terms that may cause changes in the time distribution or amount
of contractual cash flows of financial assets to determine whether they meet the requirements for the above-
mentioned contractual cash flow characteristics.
Only when the Company changes its business model for managing financial assets, can all affected related
financial assets be reclassified on the first day of the first reporting period after the change in business model;
otherwise, financial assets shall not be reclassified after initial recognition.
Financial assets are measured at fair value upon initial recognition. For financial assets at fair value through
profit or loss, relevant transaction costs are directly included in current profits and losses; for other types of
financial assets, relevant transaction costs are included in the initially recognized amount. For accounts
receivable arising from sales of products or provision of labor services that do not include or consider
significant financing components, the consideration amount that the Company is expected to be entitled to
receive will be taken as the initially recognized amount.
(3) Classification and measurement of financial liabilities
Financial liabilities of the Company are classified into financial liabilities at fair value through profit or loss and
financial liabilities measured at amortized cost upon initial recognition. For financial liabilities not classified as
those measured at fair value through profit or loss, relevant transaction costs are included in their initially
recognized amounts.
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and those
designated upon initial recognition to be measured at fair value through profit or loss. Such financial liabilities
are subsequently measured at fair value, and the gains or losses arising from changes in fair value as well as
dividends and interest expenses related to such financial liabilities are included in current profits and losses.
Financial liabilities measured at amortized cost
Other financial liabilities are subsequently measured at amortized cost using the effective interest method, and
gains or losses arising from derecognition or amortization are included in current profits and losses.
Distinction between financial liabilities and equity instruments
Financial liabilities refer to those that meet one of the following conditions:
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① Contractual obligations to deliver cash or other financial assets to other parties.
② Contractual obligations to exchange financial assets or financial liabilities with other parties under
potentially adverse conditions.
③ A non-derivative instrument contract that must or can be settled with the enterprise's own equity
instruments in the future, and according to which the enterprise will deliver a variable number of its own equity
instruments.
④ A derivative contract that must or can be settled with the enterprise's own equity instruments in the future,
except for derivative contracts where a fixed amount of its own equity instruments is exchanged for a fixed
amount of cash or other financial assets.
An equity instrument refers to a contract that can prove the residual equity in the assets of an enterprise after all
liabilities are deducted.
If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash or other
financial assets, the contractual obligation meets the definition of financial liabilities.
If a financial instrument must or can be settled with the Company's own equity instruments, it is necessary to
consider whether the Company's own equity instruments used for settlement of such instruments are used as
substitutes for cash or other financial assets or to enable the instrument holder to enjoy residual equity in the
assets of the issuer after deduction of all liabilities. If meets the former condition, the financial instrument
should be recognized as financial liabilities; If meets the latter condition, the financial instrument is recognized
as an equity instrument.
(4) Fair value of financial instruments
For the determination methods for the fair value of financial assets and liabilities, refer to 38 "Others" in V
"Significant Accounting Policies and Accounting Estimates" of Section X - Financial Report.
(5) Impairment of financial assets
The Company accounts for impairment and recognizes the loss provision for the following items on the basis of
expected credit losses:
Financial assets measured at amortized cost;
Receivables and debt investments at fair value through other comprehensive income;
Contract assets as defined in ASBE NO. 14 - Revenue;
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Lease receivables;
Financial guarantee contracts (except for those measured at fair value through profit and loss, where the
transfer of financial assets does not meet derecognition conditions or is continuously involved in the
transferred financial assets).
Measurement of expected credit losses
Expected credit loss refers to the weighted average of the credit losses of financial instruments that are weighted
by the risk of default. Credit loss refers to the difference between all contractual cash flows receivable
according to the contract and discounted by the Company at the original effective interest rate and all cash flows
expected to be collected, that is, the present value of all cash shortages.
The Company considers reasonable and reliable information about past events, current situation and forecast of
the future economic situation, weighs the risk of default, calculates the probability weighted amount of the
present value of the difference between the cash flow receivable from the contract and the cash flow expected to
be received, and recognizes the expected credit loss.
The Company measures the expected credit losses of financial instruments at different stages respectively. For
financial instruments for which the credit risk has not significantly increased since initial recognition, they are
classified in Stage 1. The company measures the loss provision based on expected credit losses over the next 12
months. For financial instruments in which the credit risk has significantly increased since initial recognition
but no credit impairment has occurred, they are classified in Stage 2. The company measures the loss provision
based on the expected credit losses over the entire remaining lifetime of the instrument. For financial
instruments in which a credit impairment has occurred since initial recognition, they are classified in Stage 3.
The company measures the loss provision based on the expected credit losses over the entire remaining lifetime
of the instrument.
For financial instruments with low credit risk on the balance sheet date, the Company assumes that their credit
risks have not increased significantly since initial recognition and measures the loss provision according to the
expected credit losses in the next 12 months.
The expected credit loss during the whole duration refers to the expected credit loss caused by all default events
that may occur during the whole expected duration of financial instruments. The expected credit loss in the next
12 months refers to the expected credit loss caused by default events of financial instruments that may occur
within 12 months after the balance sheet date (if the expected duration of financial instruments is less than 12
months, it is considered as the expected duration), which is part of the expected credit loss for the whole
duration.
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During the measurement of expected credit losses, the maximum term to be considered by the Company is the
maximum contract term of the enterprise facing credit risk (including the option to renew the contract).
For financial instruments in the first and second stages and with low credit risk, the Company calculates interest
income according to the book balance before deducting impairment provision and the actual interest rate. For
financial instruments in the third stage, interest income is calculated according to their book balance minus the
amortized cost after impairment provision and the effective interest rate.
Notes receivable, accounts receivable and contract assets
For notes receivable, accounts receivable and contract assets, the Company always measures their loss provision
according to the amount equivalent to the expected credit loss in the whole duration no matter whether there is
any significant financing component.
If the expected credit loss of a single financial asset cannot be evaluated at a reasonable cost, the Company
divides the notes receivable and accounts receivable into portfolios according to the credit risk characteristics
based on the following, and calculates the expected credit loss on the basis of the portfolios:
A. Notes receivable
Notes receivable portfolio 1: bank acceptance bills
Notes receivable portfolio 2: commercial acceptance bills
B. Accounts receivable
Aging portfolio
C. Contract assets
Aging portfolio
The Company calculates the expected credit loss of the notes receivable and contract assets divided into
portfolios by referring to the historical credit loss experience, combining the current situation and the forecast of
the future economic situation, and based on the default risk exposure and the expected credit loss rate for the
whole duration.
For accounts receivable divided into portfolios, the Company prepares a comparison table of account receivable
aging/overdue days and expected credit loss rate for the whole duration with a reference to historical credit loss
experience and in combination with the current situation and forecast of the future economic situation, so as to
calculate the expected credit loss.
Other receivables
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The Company divides other receivables into several portfolios according to the credit risk characteristics based
on the following, and calculates the expected credit loss according to the portfolios:
Portfolio 1 of other receivables: portfolio of margin, deposit and reserve fund
Portfolio 2 of other receivables: aging portfolio
For other receivables divided into portfolios, the Company calculates the expected credit loss through default
risk exposure and expected credit loss rate in the next 12 months or the whole duration.
Long-term receivables
The Company's long-term receivables include the receivables from sales of goods by installments.
The Company divides the receivables from sales of goods by installments into several portfolios according to
the credit risk characteristics based on the following, and calculates the expected credit loss on the basis of the
portfolios:
Long-term receivables portfolio 1: receivables from sales of goods by installments
Long-term receivables portfolio 2: other receivables
The Company calculates the expected credit loss of the receivables from sales of goods by installments based
on the default risk exposure and the expected credit loss rate for the whole duration with a reference to the
historical credit loss experience, the current situation and the forecast of the future economic situation.
Debt investment and other debt investments
For debt investments and other debt investments, the Company calculates expected credit losses according to
the nature of the investment, various types of counterparties and risk exposures, default risk exposures and
expected credit loss rates in the next 12 months or throughout the duration.
Assessment of significant increase in credit risk
The Company compares the risk of default of financial instruments on the balance sheet date with the risk of
default on the initial recognition date so as to determine the relative change in the default risk of financial
instruments in the expected duration and evaluate whether the credit risk of financial instruments has increased
significantly since the initial recognition.
In determining whether the credit risk has increased significantly since initial recognition, the Company
considers reasonable and well-founded information (including forward-looking information) that can be
obtained without unnecessary additional costs or efforts. The information to be considered by the Company is
as follows:
Failure of the debtor to pay the principal and interest on the due date of the contract;
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Serious deterioration in the external or internal credit rating (if any) of the financial instrument that has
occurred or is expected;
Serious deterioration of the debtor's operating results that has occurred or is expected;
Changes in the technical, market, economic or legal environment that has occurred or is expected and
their potential material adverse effect on the repayment ability of the debtor to the Company.
According to the nature of financial instruments, the Company evaluates whether the credit risk has increased
significantly on the basis of individual financial instruments or portfolios of financial instruments. When
evaluating on the basis of portfolios of financial instruments, the Company may classify the financial
instruments based on common credit risk characteristics, such as overdue information and credit risk rating.
If it is overdue for more than 30 days, the Company determines that the credit risk of financial instruments has
increased significantly.
Credit-impaired financial assets
The Company evaluates on the balance sheet date whether credit impairment has occurred on the financial
assets measured at amortized cost and on the creditor's debt investment measured at fair value through other
comprehensive income. A financial asset becomes credit-impaired when one or more events that have an
adverse impact on its expected future cash flows occur. Evidence of credit impairment of financial assets
includes the following observable information:
The issuer or the debtor is involved in serious financial difficulties;
The debtor breaches the contract, such as default on or overdue repayment of interest or principal;
The Company, for economic or contractual reasons relating to the debtor’s financial difficulty, grants
the debtor concessions that would not have been made in any other circumstances.
There is a great possibility of bankruptcy or other financial restructuring of the debtor;
The financial difficulties of the issuer or debtor result in the disappearance of the active market of such
financial assets.
Presentation of provision for expected credit loss
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the
Company remeasures the expected credit loss on each balance sheet date; the increased or reversed amount of
the loss provision arising therefrom shall be included in the current profits and losses as impairment losses or
gains. The loss provision of the financial assets measured at amortized cost is used to offset their book value
presented in the balance sheet. For the debt investment measured at fair value with its changes included in other
comprehensive income, the Company recognizes its loss provision in other comprehensive income, which will
not offset the book value of the financial assets.
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Write-off
The Company writes down the book balance of the financial assets when it no longer reasonably expects that
the contractual cash flow of the financial asset can be recovered in whole or in part. Such write-down
constitutes the derecognition of related financial assets. This usually occurs when the Company determines that
the debtor has no assets or sources of income that can generate sufficient cash flows to repay the amount to be
written down. However, the written-down financial assets may still be affected by the execution activities
according to the Company's procedures for recovering due amounts.
Any financial assets that have been previously written off and subsequently recovered are recognized as a
reversal of impairment loss and recorded in the current period's income statement.
(6) Transfer of financial assets
Transfer of financial assets refers to the assignment or delivery of financial assets to the party (transferee) other
than the issuer of such financial assets.
The financial asset is derecognized if the Company has transferred substantially all the risks and rewards of
ownership of a financial asset to the transferee. The financial asset is not derecognized if the Company has
retained substantially all the risks and rewards of ownership of a financial asset.
If the Company neither transfers nor retains almost all risks and rewards of ownership of a financial asset, it
shall deal with them as follows: if the control over the financial asset is waived, the financial asset shall be
derecognized and the assets and liabilities incurred shall be recognized; if the control over the financial asset is
not waived, the relevant financial asset shall be recognized to the extent that it continues to be involved in the
transferred financial asset, and the relevant liabilities shall be recognized accordingly.
(7) Offset of financial assets and financial liabilities
Financial assets and financial liabilities are presented in the balance sheet with the amount after offsetting each
other when the Company has a legal right to offset the recognized financial assets and financial liabilities and
the legal right can be exercised currently, and when the Company intends either to settle on a net basis, or to
realize the financial assets and pay off the financial liabilities simultaneously. In other cases, financial assets
and financial liabilities are presented separately in the balance sheet and are not offset against each other.
11 Notes receivable
Refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
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12 Accounts receivable
Refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
13 Receivables financing
Refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
14 Other receivables
For determination methods and accounting methods of expected credit losses of other receivables,
Refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
15 Inventories
(1) Classification of inventories
The inventories of the Company are divided into raw materials, self-made semi-finished products and goods in
process, goods in stock, revolving materials, etc.
(2) Valuation method for inventories sent out
The Company's inventories are accounted for at the planned cost when acquired. The difference between the
planned cost and the actual cost is accounted for through the cost variance account, and the cost variance that
should be borne by the inventories sent out is carried forward on schedule to adjust the planned cost to the
actual cost.
(3) Basis for determining the inventory’s net realizable value and method for provision for decline in the value
of inventories
The net realizable value of inventories is the amount obtained by deducting the estimated costs to be incurred
until completion, estimated sales expenses and relevant taxes from the estimated selling price of inventories.
The net realizable value of inventories is determined based on the unambiguous evidence obtained as well as
the consideration of the purpose of holding inventories and the impact of events after the balance sheet date.
If the inventory cost is higher than its net realizable value on the balance sheet date, provision for inventory
falling price shall be made. The Company usually makes the provision for inventory falling price based on an
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individual inventory item. On the balance sheet date, if the factors affecting the previous write-down of
inventory value have disappeared, the inventory falling price reserves shall be reversed within the amount
originally provided for.
(4) Inventory system
The Company adopts the perpetual inventory system.
(5) Amortization method for low-value consumables and packaging materials
Low-value consumables and packaging materials of the Company are amortized by one-off write-off method
when acquired.
16 Contract assets
The Company presents the contract assets or contract liabilities in the balance sheet according to the
relationship between the performance obligations and the customer's payment. The Company presents the
contract assets and liabilities under the same contract on a net basis after offsetting each other.
A contractual asset refers to a right to receive consideration for goods or services that have been transferred to a
customer, and the right depends on factors other than the passage of time.
For the determination method and accounting method of the Company for the expected credit loss of the
contract assets, refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting
Estimates" of Section X - Financial Report.
17 Contract cost
The contract cost includes the incremental cost incurred for obtaining a contract and the contract performance
cost.
Incremental costs incurred for obtaining a contract refer to the costs (such as sales commissions) that would not
have occurred if the Company had not obtained the contract. If the cost is expected to be recovered, the
Company recognizes it as a contract acquisition cost and an asset. Other expenditures incurred by the Company
for obtaining contracts other than incremental costs that are expected to be recovered are included in current
profits and losses when incurred.
If the cost incurred for contract performance is not within the scope of other accounting standards for business
enterprises such as inventories and meets the following conditions at the same time, the Company recognizes it
as an asset for the contract performance cost:
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① This cost is directly related to a current or expected contract, including direct labor, direct materials,
manufacturing expenses (or similar expenses), costs explicitly borne by the customer and other costs incurred
only by the Contract;
② This cost increases the Company’s resources for performing the performance obligations in the future;
③ This cost is expected to be recovered.
Assets recognized as contract acquisition costs and that recognized as contract performance costs (hereinafter
referred to as "assets related to contract costs") are amortized on the same basis as revenue recognition of goods
or services related to the assets and are included in current profits and losses.
When the book value of the assets related to the contract cost is higher than the difference between the
following two items, the Company will make provision for the impairment of the excess and recognize it as the
asset impairment loss:
① The residual consideration expected to be obtained by the Company from the transfer of goods or services
related to the asset;
② The estimated costs to be incurred for the transfer of relevant goods or services.
The contract performance cost recognized as an asset shall be listed in the "inventory" item if its amortization
period does not exceed one year or a normal operating cycle at initial recognition, and shall be listed in the
"other non-current assets" item if its amortization period exceeds one year or a normal operating cycle at initial
recognition.
The contract acquisition cost recognized as an asset shall be listed in the item "Other current assets" if the
amortization period at the time of initial recognition is not more than one year or one normal operating cycle,
and listed in the item "Other non-current assets" if the amortization period at the time of initial recognition is
more than one year or one normal operating cycle.
18 Held-for-sale assets
(1) Classification and measurement of held-for-sale non-current assets or disposal groups
The non-current asset or disposal group is classified as the held-for-sale asset if the Company recovers its book
value mainly by selling (including the exchange of non-monetary assets of commercial nature) rather than
continuously using the non-current asset or disposal group.
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The above non-current assets do not include investment properties subsequently measured at fair value,
biological assets measured at the net amount of fair value minus selling expenses, assets formed by employee
compensation, financial assets, deferred income tax assets and rights arising from insurance contracts.
Disposal group refers to a group of assets that are disposed together by sale or other means as a whole in a
transaction, and liabilities directly related to these assets transferred in the transaction. Under specific
circumstances, the disposal group includes goodwill acquired in business combination.
Non-current assets or disposal groups that meet all the following conditions are classified as the held-for-sale
assets: The non-current assets or disposal groups can be sold immediately under current conditions according to
the practice of selling such assets or disposal groups in similar transactions; they are extremely likely to be sold,
i.e. a resolution has been made on a sales plan and a certain purchase commitment has been obtained, and the
sales are expected to be completed within one year. The overall investment to subsidiaries is classified as held-
for-sale assets in individual financial statements, and all assets and liabilities of subsidiaries are classified as the
held-for-sale assets in consolidated financial statements when the investment to subsidiaries meets the
conditions for the held-for-sale assets if the Company loses control over its subsidiaries due to reasons such as
the sales of investment to subsidiaries, whether the Company reserves some of its equity investments after the
sales or not.
The difference between the book value and the net amount obtained by deducting the selling expenses from the
fair value is recognized as the asset impairment loss when the held-for-sale non-current assets or disposal
groups are measured initially or re-measured on the balance sheet date. The asset impairment loss recognized by
the held-for-sale disposal group deducts the book value of the goodwill in the disposal group, and then deducts
the book value of each non-current asset in the disposal group based on its proportion.
The previous write-down amount is recovered and reversed from the asset impairment losses recognized after
being classified as the held-for-sale assets, and the reversed amount is included in the current profits and losses
if the net amount obtained by deducting the selling expenses from the fair value of held-for-sale non-current
assets or disposal groups on the subsequent balance sheet date increases. The book value of goodwill that has
been deducted shall not be reversed.
Held-for-sale non-current assets and assets in the held-for-sale disposal group are not depreciated or amortized.
The interest on liabilities and other expenses in the held-for-sale disposal group are recognized continuously.
For all or part of the investments of held-for-sale associated enterprises or joint ventures, the held-for-sale part
will not be accounted for with equity method, and the retained part (not classified as the held-for-sale asset) will
be accounted for continuously with the equity method. The equity method will not be used any more when the
Company has no significant influence on associated enterprises and joint ventures due to sales.
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For a non-current asset or disposal group that is classified as the held-for-sale asset but later no longer meets the
conditions for the held-for-sale asset, the Company will cease to classify it as the held-for-sale asset and
measure it based on the lower of the following two amounts:
① The amount of the book value of the asset or disposal group before being classified as the held-for-sale
asset after adjustment based on depreciation, amortization or impairment that should have been recognized had
it not been classified as the held-for-sale asset;
② Recoverable amount.
(2) Presentation
In the balance sheet, the Company presents the held-for-sale non-current assets or the assets in the held-for-sale
disposal group as the "held-for-sale assets", and presents the liabilities in the held-for-sale disposal group as the
"held-for-sale liabilities".
The Company presents the profits and losses from continuing operations and discontinued operations separately
in the profit statement. For non-current assets or disposal groups held for sale that do not meet the definition of
discontinued operation, their impairment losses, reversed amounts and disposal gains and losses are presented
as profits and losses from continuing operations. Operating profits and losses such as impairment losses and
reversed amounts of discontinued operations and disposal gains and losses are presented as profits and losses
from discontinued operations.
Disposal groups that are intended to be discontinued rather than sold and meet the conditions of relevant
components in the definition of discontinued operation are presented as discontinued operations from the date
of discontinuance.
For discontinued operations presented in the current period, the information originally presented as profits or
losses from continuing operations in the current financial statements is re-presented as profits or losses from
discontinued operations in comparable accounting period. If the discontinued operation no longer meets the
conditions for the classification of held-for-sale assets, the information originally presented as profits or losses
from discontinued operations in the current financial statements is re-presented as profits or losses from
continuing operations in comparable accounting period.
19 Long-term receivables
Refer to 10 "Financial instruments" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
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20 Long-term equity investments
Long-term equity investments include equity investments to subsidiaries, joint ventures and associated
enterprises. The investee which may be subject to significant influence of the Company is an associated
enterprise of the Company.
(1) Recognition of initial investment cost
Long-term equity investments acquired from the business combination: For the long-term equity investment
acquired from the business combination under common control, the investment cost refers to the share of the
book value of the owner's equity of the combined party in the consolidated financial statements of the ultimate
controlling party on the combination date; for the long-term equity investment acquired from the business
combination under different control, the investment cost refers to the combination cost.
For long-term equity investments acquired by other methods: For those acquired with cash payment, the actual
purchase price shall be recognized as the initial investment cost; for those acquired through the issuance of
equity securities, the fair value of issued equity securities shall be recognized as the initial investment cost.
(2) Subsequent measurement and recognition of profit or loss
Investments to subsidiaries are accounted for with the cost method unless the investment meets the conditions
for held-for-sale; investments to associated enterprises and joint ventures are accounted for with the equity
method.
For long-term equity investments calculated by cost method, except for the declared but not yet released cash
dividends or profits included in the actual price or consideration paid when the investment is acquired, the
distributed cash dividends or profits declared by the investee shall be recognized as investment income and
included in current profits and losses.
For the long-term equity investments accounted for with the equity method, the investment cost is not adjusted
if the initial investment cost exceeds the share of the fair value of the investee's identifiable net assets at the time
of the investment; the book value of the long-term equity investment is adjusted and the difference is included
in the current profits and losses if the initial investment cost is less than the share of fair value of the investee's
identifiable net assets at the time of the investment.
For accounting with the equity method, the investment income and other comprehensive income shall be
recognized respectively according to the share of the net profits and losses and other comprehensive income
realized by the investee that shall be enjoyed or shared. Meanwhile, the book value of the long-term equity
investments shall be adjusted. The part of due share shall be calculated according to the distributed profit or
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cash dividend declared by the investee, and the book value of the long-term equity investment shall be reduced
accordingly. For other changes in owners' equity of the investee except net profit and loss, other comprehensive
income and profit distribution, the book value of long-term equity investment shall be adjusted and included in
capital reserve (other capital reserve). The Company recognizes its share of the investee's net profits or losses
based on the fair values of the investee's individual separately identifiable assets at the time of acquisition, after
making appropriate adjustments thereto in conformity with the accounting policies and accounting periods of
the Company.
The sum of the fair value of the original equity and the new investment cost is taken as the initial investment
cost calculated with the equity method on the date of conversion if it is possible to exert significant influence on
or implement joint control but not constitute control over the investee due to additional investment or other
reasons. The cumulative changes in fair value originally included in other comprehensive income related to the
original equity are transferred to retained earnings when the equity method is adopted if the original equity is
classified as a non-trading equity instrument measured at fair value through other comprehensive income.
In case that the Company loses joint control of or the significant influence on the investee due to the disposal of
part of the equity investment, the residual equity after the disposal is accounted for in accordance with the
Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial
Instruments on the date of losing the joint control or significant influence, and the difference between the fair
value and the book value is included in the current profits and losses. Other comprehensive income recognized
from the original equity investment accounted with the equity method shall be accounted for on the same basis
as the direct disposal of relevant assets or liabilities of the investee when the equity method is terminated. Other
changes in owner’s equity related to the original equity investment shall be transferred into current profit and
loss.
In case that the Company loses the right of control over the investee due to disposal of partial equity investment
or other reasons, the equity method is applied, and it is deemed that the residual equity is adjusted with equity
method from the time of acquisition if the residual equity after disposal can exert joint control over or
significant influence on the investee; the accounting is carried out according to the Accounting Standards for
Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments, and the difference
between the fair value and the book value on the date of losing control is included in the current profits and
losses if the residual equity after disposal cannot exert joint control over or significant influence on the investee.
If the shareholding ratio of the Company decreases due to capital increase by other investors, resulting in loss of
control but joint control over or significant influence on the investee, the Company's share of net assets
increased due to capital increase and share expansion of the investee shall be recognized according to the new
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shareholding ratio, and the difference from the original book value of long-term equity investment
corresponding to the decrease in shareholding ratio that shall be carried forward shall be included in current
profits and losses. Then, adjustments are made based on the new shareholding ratio with the equity method as if
it had been used since the acquisition of the investment.
Unrealized gains and losses from internal transactions between the Company and its associated enterprises and
joint ventures that are attributable to the Company are calculated based on the shareholding ratio, and
investment profits and losses are recognized based on the offsetting of that portion. However, the unrealized
loss from internal transactions incurred between the Company and its investee is not offset if it belongs to
impairment loss from assets transferred.
(3) Basis for determining joint control and significant influence on the investee
Joint control refers to the control over certain arrangement under related agreements, and related activities of
the arrangement can only be determined with the unanimous consent of the parties sharing the control. During
the judgment of joint control, it is required to determine whether the arrangement is controlled collectively by
all participants or combinations of participants, and then determine whether decisions on activities related to the
arrangement must be made with the unanimous consent of those participants who collectively control the
arrangement. It is deemed that all participants or a group of participants collectively control the arrangement if
related activities of an arrangement can be decided only with the concerted action of all participants or a group
of participants. If there are two or more combinations of parties that can collectively control an
arrangement, this situation does not constitute joint control. For the determination of whether there is joint
control, protective rights are not taken into account.
Significant influence refers to the power of the investor to participate in making decisions on the financial and
operating policies of the investee, but cannot control or jointly control with other parties over the preparation of
these policies. The possibility of exerting significant influence on the investee is determined by considering the
influence of the voting shares of the investee directly or indirectly held by the investor and the influence when it
is assumed that the potential voting rights executable for the current period held by the investor and other
parties are converted into the equity of the investee, including the influence of the warrants, stock options and
corporate bonds which can be converted in the current period issued by the investee.
It is generally considered that the Company has a significant influence on the investee when the Company owns
more than 20% (including 20%) but less than 50% of the voting shares of the investee directly or indirectly
through subsidiaries unless there is clear evidence that it cannot participate in the production and operation
decisions of the investee under such circumstances, in which case it has no significant influence. It is generally
not considered that the Company has a significant influence on the investee when the Company owns less than
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20% (exclusive) of the voting shares of the investee unless there is clear evidence that it can participate in the
production and operation decisions of the investee under such circumstances, in which case it has significant
influence.
(4) Impairment test method and impairment provision methods
For investments to subsidiaries, associated enterprises and joint ventures, the method of provision for asset
impairment is described in 38 "Others" in V "Significant Accounting Policies and Accounting Estimates" of
Section X - Financial Report.
21 Investment properties
Measurement mode of investment properties: cost method
Depreciation or amortization method
Investment properties refer to the properties held for earning rent or capital appreciation, or both. Investment
properties of the Company include the land use rights that have already been rented, the land use rights held for
transfer after appreciation, and the buildings that have been rented.
Investment properties of the Company are initially measured as per the price upon acquisition and depreciated
or amortized on schedule as per relevant provisions on fixed assets or intangible assets.
For the investment properties subsequently measured at the cost mode, refer to 38 "Others" in V "Significant
Accounting Policies and Accounting Estimates" of Section X - Financial Report for the method of provision for
asset impairment.
The disposal income from the sale, transfer, retirement or damage of investment properties shall be included in
current profits and losses after deducting its book value and relevant taxes.
22 Fixed assets
(1) Recognition conditions
Fixed assets of the Company refer to the tangible assets held for the production of goods, rendering of services,
the renting or operation and management, with a service life exceeding one accounting year.
The fixed assets can be recognized only when the economic benefits related to such fixed assets are likely to
flow into the enterprise and the cost of such fixed assets can be measured reliably.
Fixed assets of the Company are initially measured at the actual cost upon acquisition.
Subsequent expenditures related to fixed assets are included in the cost of fixed assets when the related
economic benefits are likely to flow into the Company and the costs can be reliably measured. The daily repair
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costs of fixed assets that do not meet the conditions for the subsequent expenditure of fixed assets capitalization
are included in the current profits and losses or the costs of relevant assets based on the beneficiaries at the time
of occurrence. For the replaced part, its book value is derecognized.
(2) Depreciation method
Depreciation Residual
Category Depreciation Method Annual Depreciation Rate
Period Rate
Houses and buildings Straight-line method 20 years 3-5 4.85-4.75
Machinery equipment Straight-line method 10 years 0-3 10.00-9.70
Transportation
Straight-line method 4-10 years 0-5 25.00-9.50
equipment
Electronic equipment Straight-line method 3 years 0-5 33.33-31.67
Office equipment Straight-line method 3-5 years 3-5 32.33-19.00
Others Straight-line method 4-10 years 0-5 24.25-9.50
The Company uses the straight-line method for depreciation. The depreciation of fixed assets starts when they
reach the expected serviceable condition and stops when they are derecognized or classified as non-current
assets held for sale. Without considering the impairment provision, the Company determines the annual
depreciation rate of various fixed assets according to their categories, expected service life and estimated
residual value. For fixed assets with impairment provision, the accumulated amount of impairment provision of
fixed assets shall also be deducted to calculate and determine the depreciation rate.
① For the impairment test methods and impairment provision methods of fixed assets, refer to 38 "Others" in
V "Significant Accounting Policies and Accounting Estimates" of Section X - Financial Report.
② The Company reviews the service life, expected net residual value, and depreciation method of fixed assets
at the end of each year.
The service life of fixed assets shall be adjusted if the expected service life is different from the original
estimate, and the estimated net residual value shall be adjusted if the estimated net residual value is different
from the original estimate.
③ Disposal of fixed assets
Fixed assets are derecognized when they are disposed of or no economic benefits can be expected from their use
or disposal. The disposal income from the sale, transfer, retirement or damage of fixed assets shall be included
in current profits and losses after deducting its book value and relevant taxes.
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23 Construction in progress
The cost of construction in progress of the Company is recognized according to the actual construction
expenditures, including various necessary construction expenditures incurred during the construction period,
borrowing costs that shall be capitalized before the construction reaches the expected condition for its intended
use, and other relevant expenses.
Construction in progress is transferred to fixed assets when it is ready for its intended use.
For the method of provision for asset impairment of construction in progress, refer to 38 "Others" in V
"Significant Accounting Policies and Accounting Estimates" of Section X - Financial Report.
24 Right-of-use assets
(1) Recognition conditions for right-of-use assets
Right-of-use assets refer to the right of the Company, as the lessee, to use the leasing assets within the lease
term.
At the commencement date of the lease term, the right-of-use assets are initially measured at cost. This cost
includes the initial measurement amount of lease liabilities, lease payments made on or before the lease
commencement date, from which any lease incentives enjoyed (if any) needed to be deducted, initial direct
costs incurred by the Company as a lessee, and the estimated costs expected to be incurred by the Company as a
lessee for dismantling and removing the leased asset, restoring the leased asset's site, or restoring the leased
asset to the contractual conditions as stipulated in the lease agreement. The Company, as the lessee, recognizes
and measures the cost of demolition and restoration in accordance with the Accounting Standards for Business
Enterprises No. 13 - Contingencies. Subsequent adjustments are made for any remeasurement of the lease
liabilities.
(2) Depreciation method of right-of-use assets
The Company uses the straight-line method for depreciation. If the Company, as the lessee, can reasonably
confirm that it obtains the ownership of the leasing assets at the expiration of the lease term, the depreciation
shall be drawn within the remaining service life of the leasing assets. In case of a failure to determine the
ownership of the leased assets reasonably at the end of the lease period, the depreciation shall be drawn within
the lease term or the remaining service life of leasing assets, whichever is shorter.
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(3) The impairment test method and drawing method for impairment provision of right-of-use assets are
described in 38 "Others" in V "Significant Accounting Policies and Accounting Estimates" of Section X -
Financial Report.
25. Intangible assets
(1) Valuation method, service life and impairment test
Intangible assets of the Company include land use rights, software, non-patented technologies, etc.
Intangible assets are initially measured at cost and their service life is analyzed and judged at the time of
acquisition. Where the service life is limited, the intangible asset is amortized over its expected service life,
from the time it is available, with an amortization method that reflects the expected realization of the economic
benefits associated with the asset. The straight-line method is adopted for amortization if the expected
realization mode cannot be determined reliably. Intangible assets with uncertain service life are not amortized.
The amortization method for intangible assets with limited service life is as follows:
Category Service Life Amortization Method Remarks
Land use right 50 years Straight-line method
Software 2-10 years Straight-line method
Non-patented
5-10 years Straight-line method
technology
The Company reviews the service life and amortization method of intangible assets with limited service life at
the end of each year. If it is different from the previous estimate, the original estimate shall be adjusted and
treated as a change in accounting estimates.
The book value of an intangible asset is transferred into the current profits and losses in full if it is expected that
the asset cannot bring economic benefits to the enterprise in the future on the balance sheet date.
For the method of provision for asset impairment of the intangible assets, refer to 38 "Others" in V "Significant
Accounting Policies and Accounting Estimates" of Section X - Financial Report.
(2) Accounting policies for expenditures on internal research and development
The Company divides the expenditures of internal research and development projects into expenditures at the
research stage and expenditures at the development stage.
The expenditures at the research stage are included in current profits and losses when incurred.
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Expenditures at the development stage can be capitalized only when the following conditions are met
simultaneously, namely, it is technically feasible to complete the intangible assets so that they can be used or
sold; there is an intention to complete the intangible assets and use or sell them; the ways for intangible assets to
generate economic benefits include proving that there is a market for the products produced by using the
intangible assets or the intangible assets themselves, and proving their usefulness if they are to be used
internally; there are sufficient technical, financial and other resources to support the development of the
intangible assets and the ability to use or sell the intangible assets; the expenditure at the development stage of
the intangible assets can be measured reliably. The development expenditures failing to meet the above
conditions are included in current profits and losses when they occur.
The R&D projects of the Company enter the development stage after project approval by meeting the above
conditions and passing the technical feasibility and economic feasibility study.
The capitalized expenditures at the development stage are presented as development expenditures on the
balance sheet and are transferred into intangible assets from the date when the project realizes its intended use.
26. Impairment of long-term assets
The asset impairment of long-term equity investment to subsidiaries, associated enterprises and joint ventures,
investment real estates subsequently measured by cost model, fixed assets, project under construction, right-of-
use assets, intangible assets, etc. (except for inventories, deferred income tax assets and financial assets) is
determined with the following methods:
The Company judges whether there is a sign of impairment to assets on the balance sheet date. If such a sign
exists, the Company estimates the recoverable amount and conducts the impairment test. Impairment tests shall
be carried out every year on goodwill resulting from business mergers, intangible assets with uncertain service
life and intangible assets that are not available no matter whether there is any sign of impairment.
The recoverable amount is the net amount of the fair value of the assets after deducting the disposal expenses or
the present value of the expected future cash flow of the assets, whichever is higher. The Company estimates
the recoverable amount based on a single asset. If it is difficult to estimate the recoverable amount of a single
asset, the recoverable amount of the asset group shall be determined based on the asset group to which the asset
belongs. An asset group is determined based on the fact that the main cash inflows generated by the asset group
are independent of the cash inflows of other assets or asset groups.
When the recoverable amount of an asset or asset group is lower than its book value, the Company writes down
its book value to the recoverable amount, and the write-down amount is included in current profits and losses,
and the corresponding impairment provision of assets is made at the same time.
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For the impairment test of goodwill, the book value of goodwill resulting from business merger is amortized to
relevant asset groups with reasonable methods from the acquisition date, or amortized to relevant asset group
portfolio if it is difficult to amortize it to relevant asset groups. Relevant asset groups or portfolios of asset
groups are those that can benefit from the synergies of business merger and are not greater than the reporting
segment determined by the Company.
If there is any sign of impairment in the asset group or portfolio of asset groups related to goodwill during the
impairment test, the impairment test shall be carried out on the asset group or portfolio of asset groups not
including goodwill, and the recoverable amount shall be calculated to determine the corresponding impairment
loss. Then, an impairment test is carried out on the asset group or portfolio of asset groups including goodwill to
compare its book value and recoverable amount, and determine the impairment loss of goodwill if the
recoverable amount is lower than the book value.
Once the impairment loss of assets is determined, it will never be reversed in subsequent accounting periods.
27. Long-term deferred expenses
Long-term unamortized expenses of the Company shall be valued as per actual cost and averagely amortized as
per the expected benefit period. The amortized value of the long-term deferred expenses that cannot benefit the
future accounting period is included in the current profits and losses.
28. Contract liabilities
The Company presents the contract assets or contract liabilities in the balance sheet according to the
relationship between the performance obligations and the customer's payment. The Company presents the
contract assets and liabilities under the same contract on a net basis after offsetting each other.
Contractual liability refers to an obligation to transfer goods or services to a customer for which customer
consideration has been received or receivable, such as payments received by an enterprise prior to the transfer
of promised goods or services.
29. Employee compensation
(1) Accounting method of short-term compensation
Employee compensation refers to various forms of remuneration or compensation given by enterprises to obtain
services provided by employees or to terminate labor relations. Employee compensation includes short-term
compensation, post-employment benefits, dismissal benefits and other long-term employee benefits. The
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benefits provided by the enterprise to employees' spouses, children, dependents, survivors of deceased
employees and other beneficiaries also belong to employee compensation.
According to liquidity, employee compensation is listed in the "employee compensation payable" and "long-
term employee compensation payable" items of the balance sheet.
Short-term compensation
In the accounting period when employees provide services, the Company recognizes the employee wages,
bonuses, social security contributions according to regulations such as medical insurance, work injury insurance
and maternity insurance as well as housing funds as liability, and includes them in current profits and losses or
relevant asset costs.
(2) Accounting method of post-employment benefits
The post-employment benefit plan includes defined contribution plan and defined benefit plan. The defined
contribution plan refers to the post-employment benefit plan that the enterprise will no longer bear the payment
obligation after paying fixed fees to independent funds. The defined benefit plan refers to the post-employment
benefit plan other than the defined contribution plan.
Defined contribution plan
The defined contribution plan includes basic pension insurance, unemployment insurance and enterprise annuity
plan.
In the accounting period when employees provide services, the Company recognizes the amount payable to a
defined contribution plan as a liability, and includes it in the current profit or loss or relevant asset cost.
Defined benefit plan
The defined benefit plan shows that an actuarial valuation is performed by an independent actuary on the annual
balance sheet date, and the benefit cost is determined with the expected cumulative benefit unit method. The
Company recognizes the following components of employee benefits cost arising from defined benefit plans:
① Service costs include current service costs, past service costs and settlement gains or losses. Among them,
the current service cost refers to the increase in the present value of the defined benefit plan obligations due to
the provision of services by employees in the current period; the past service cost refers to the increase or
decrease in the present value of the defined benefit plan obligations related to the employee services in the
previous period due to the modification of the defined benefit plan.
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② Net interest on net liabilities or assets of defined benefit plans, including interest income of plan assets,
interest expense of defined benefit plan obligations and interest affected by asset ceiling.
③ Changes arising from remeasurement of net liabilities or net assets of defined benefit plans.
The Company includes the above items ① and ② in the current profits and losses, unless other accounting
standards require or allow the cost of employee benefits to be included in the cost of assets; item ③ is included
in other comprehensive income and will not be reversed back to profit or loss in subsequent accounting periods,
and the part originally included in other comprehensive income within the equity scope is carried forward to
undistributed profit when the original defined benefit plan terminates.
(3) Accounting method of dismissal welfare
When the Company provides dismissal welfare to employees, the liabilities of the employee compensation
arising from dismissal welfare are recognized at the earlier of the following two dates and included in the
current profit or loss: the Company cannot unilaterally provide the dismissal welfare provided due to the labor
relation termination plan or the layoff suggestions; the Company recognizes the costs or expenses related to the
restructuring of termination benefits payment.
If the early retirement plan is implemented, the economic compensation before the official retirement date
belongs to dismissal welfare. The wages proposed to be paid to the early retired employee and the social
insurance premiums to be paid are included in the current profits and losses in a lump sum from the date when
the employee stops providing services to the normal retirement date. Economic compensation after the official
retirement date (such as normal pension) belongs to post-employment benefits.
(4) Accounting method of other long-term employee benefits
Other long-term employee benefits provided by the Company to the employees satisfying the conditions for
classifying as a defined contributions plan are accounted for in accordance with the above requirements relating
to defined contribution plan. The benefits that meet the requirements of the defined benefit plan are treated in
accordance with the provisions of the plan. However, the "changes caused by remeasurement of net liabilities or
net assets of the defined benefit plan" in relevant employee compensation costs are included in current profits
and losses or relevant asset costs.
30. Lease liabilities
Refer to 24 "Right-of-use Assets" in V "Significant Accounting Policies and Accounting Estimates" of Section
X - Financial Report.
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31. Estimated liabilities
The Company recognizes the obligations related to contingencies as estimated liabilities if they meet all of the
following conditions:
(1) The obligation is the current obligation of the Company;
(2) Performance of this obligation will probably cause an outflow of economic interest of the Company;
(3) The amount of such obligation can be measured reliably.
Expected liabilities are initially measured at the optimal estimate required to perform the relevant current
obligation, in comprehensive consideration of the risks, uncertainty, time value of money, and other factors
pertinent to the Contingencies. The best estimate is determined by discounting the relevant future cash outflow
if the time value of money has a significant impact. At the balance sheet date, the book value of the estimated
liabilities is reviewed and adjusted by the Company to reflect the current best estimate.
If all or part of the expenditures necessary for clearing off the recognized provisions are expected to be
compensated by a third party or any other party, the amount of compensation shall be recognized as assets
separately only when it is basically sure that the amount can be obtained. The recognized amount of
compensation shall not exceed the book value of recognized liabilities.
32. Share-based payment
(1) Types of share-based payment
The share-based payments of the Company are divided into equity-settled share-based payment and cash-settled
share-based payment.
(2) Determination methods for fair value of equity instruments
The Company recognizes the fair value of equity instruments such as granted options with an active market
according to the quotation of the active market. The Company recognizes the fair value of equity instruments
such as granted options without active market by using the option pricing model. The following factors are
considered in the selected option pricing model: A. exercise price of options; B. validity period of options; C.
current price of underlying shares; D. expected fluctuation ratio of stock price; E. expected dividends of shares;
F. risk-free interest rate within the validity period of options.
(3) Basis for determining the optimal estimate of vested equity instruments
The Company makes the optimal estimate based on the latest follow-up information such as changes in the
number of vesting employees and corrects the expected number of vested equity instruments on each balance
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sheet date within the vesting period. On the vesting date, the final estimated number of vested equity
instruments shall be consistent with the number of actual vested equity instruments.
(4) Accounting treatment related to implementation, modification and termination of share-based payment
plan
Share-based payments settled by equity are measured at the fair value of the equity instruments granted to
employees. Where the equity instrument can be vested immediately upon being granted, the share-based
payment is included in relevant costs or expenses at the fair value of equity instrument on the granting date and
the capital reserve shall be increased accordingly. Where the equity instrument can not be vested until the
vesting period comes to an end or until the specified performance conditions are met, at each balance sheet date
within the vesting period, the services obtained in the current period are, based on the optimal estimate of the
number of vested equity instruments, included in relevant costs or expenses and capital reserve at the fair value
specified on the granting date of equity instruments. After the vesting date, it shall make no adjustment to the
relevant costs or expenses as well as the total amount of the owner's equities which have been confirmed.
Share-based payments settled by cash are measured at the fair value of liabilities recognized based on shares or
other equity instruments assumed by the Company. Where the equity instrument can be vested immediately
upon being granted, the payment shall be included in the relevant costs or expenses at the fair value of the
liabilities assumed by the Company on the granting date, and the liabilities shall be increased accordingly.
Where the share-based payment settled by cash cannot be vested until the vesting period comes to an end or
until the specified performance conditions are met, on each balance sheet date within the vesting period, the
services acquired in current period are, based on the optimal estimation of the vesting right, included in costs or
expenses and corresponding liabilities at the fair value of the liabilities assumed by the Company. On each
balance sheet date and the settlement date prior to the settlement of the relevant liabilities, the fair value of the
liabilities shall be re-measured, with its changes included in the current profits and losses.
When the Company modifies the share-based payment plan, the increase in services obtained shall be
recognized based on the increase (if any) in the fair value of equity instruments; if the quantity of granted equity
instruments is increased, the fair value of the increased equity instruments shall be recognized accordingly as
the increase in the services obtained. The increase in the fair value of equity instruments refers to the difference
between the fair values of equity instruments before and after modification on the modification date. If the total
fair value of share-based payment is reduced in the modification or the terms and conditions of the share-based
payment plan are modified in other ways unfavorable to employees, the accounting treatment on acquired
services shall continue as if the change has never occurred, unless the Company has canceled part or all of the
granted equity instruments.
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If, during the vesting period, the granted instruments are canceled (except for those canceled because of failure
to meet the non-market conditions of the vesting conditions), the Company shall accelerate the vesting of the
granted equity instruments, and immediately include the amount to be recognized in the remaining vesting
period in the current profit and loss, and determine the capital reserve in the meantime. In the event that the
employees or other parties can choose to meet the non-vesting conditions but fail to meet such conditions
during the vesting period, the Company shall treat it as the cancellation of granted equity instruments.
33. Income
Accounting policies adopted for income recognition and measurement
(1) General principles
The Company recognizes its income when it has fulfilled its performance obligations of the contract, i.e., the
customer has obtained the control rights of the relevant goods or services.
If the contract contains two or more performance obligations, the Company shall, at the beginning date of the
contract, apportion the transaction price to each performance obligation according to the relative proportion of
the individual selling price of the goods or services promised by each performance obligation, and measure the
income according to the transaction price apportioned to each performance obligation.
In case one of the following conditions is met, the Company will perform the performance obligations within a
period of time. Otherwise, it will perform the performance obligations at a time point:
① The customer obtains and consumes the economic benefits brought by the performance of the contract by
the Company at the same time.
② The customer can control the goods under construction during the Company's performance;
③ The goods produced during the performance of the Company are irreplaceable, and the Company has been
entitled to receive payment for the performance accumulated so far throughout the term of the contract.
For the performance obligations performed within a certain period of time, the Company shall determine the
income within that period according to the performance progress. If the performance progress cannot be
reasonably confirmed, and the costs incurred by the Company can be expected to be compensated, the incomes
shall be recognized according to the amount of costs incurred until the performance progress can be reasonably
confirmed.
For performance obligations performed at a certain time point, the Company shall confirm the income at the
time point when the customer gains control rights of the relevant goods or services. In determining whether a
customer has obtained the control rights of the goods or services, the Company shall take the following signs
into consideration:
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① The Company enjoys the right to the current collection, i.e., the customer has the obligation to pay
immediately with respect to the goods;
② The Company has transferred the legal ownership of the goods to the customer, i.e., the customer owns the
legal ownership of the goods;
③ The Company has transferred the goods to the customer in kind, i.e., the customer has possessed the goods;
④ The Company has transferred the major risks and remuneration on the ownership of the goods to the
customer, i.e., the customer has obtained the major risks and remuneration on the ownership of the goods.
⑤ The customer has accepted such goods or services.
⑥ Other signs indicate that the customer has obtained the right to control the goods.
The right of the Company to receive the consideration due to the transfer of goods or services to the customer
(and the right depends on other factors than the passage of time) is taken as a contractual asset, and the
contractual assets are impaired based on the expected credit losses (please refer to 10 "Financial Instruments" in
V "Significant Accounting Policies and Accounting Estimates" of Section X "Financial Report"). The
Company’s unconditional (subject only to the passage of time) right to collect consideration from customers
shall be presented as receivables. The Company's obligations to transfer goods or services to the customer due
to customer consideration received or receivable shall be defined as contract liabilities.
Contract assets and contract liabilities under the same contract shall be presented in net amount. If the net
amount is the debit balance, it shall be presented in the item of "contract assets" or "other non-current assets"
according to its liquidity; if the net amount is the credit balance, it shall be presented in the item of "contract
liabilities" or "other non-current liabilities" according to its liquidity.
(2) Specific methods
The specific method for recognizing the sales income of the Company's vehicles and their accessories is as
follows: When the vehicles and their accessories and other goods are transported to the customer and the
customer has accepted the goods, the customer obtains the right to control over them, and the Company
recognizes the income.
Differences in accounting policies for income recognition due to different business models for similar
businesses: none
34. Government subsidies
The government subsidies shall be recognized when all the attached conditions can be satisfied and the
government subsidies can be received.
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The government subsidies considered as monetary assets are measured at the amount received or receivable.
The government subsidies considered as non-monetary assets are measured based on the fair value, or the
nominal amount of CNY 1 if the fair value cannot be acquired reliably.
Asset-related government subsidies refer to those obtained by the Company and used for acquiring or forming
long-term assets in other ways; otherwise, they are regarded as income-related government subsidies.
For the government subsidies with the grant objects not expressly stipulated in the government documents, if
they can be used to form long-term assets, the government subsidies corresponding to the asset value are
deemed as the government subsidies related to assets while the rest is deemed as the one related to income; for
the government subsidies that are difficult to differentiate, the government subsidies as a whole are deemed as
income-related government subsidies.
Asset-related government subsidies are recognized as deferred income and included in profits or losses by
stages with a reasonable and systematic method within the service life of related assets. For the income-related
government subsidies, they shall be included in the current profit and loss if used to compensate for the incurred
related costs or losses; if used to compensate for the related costs or losses during future periods, they shall be
included in the deferred income, and included in the current profit and loss during the period when the related
costs or losses are recognized. Government subsidies measured at the nominal amount are directly included in
the current profit and loss. The Company adopts the same treatment for those transactions of similar
government subsidies.
The government subsidies related to daily activities shall be included in other incomes based on the substance
of business transactions. Government subsidies irrelevant to daily activities are included in non-business income.
If it is necessary to refund the government subsidies that have been recognized, the book value of the assets
which has been offset at the time of initial recognition is adjusted; the book balance of the deferred income
concerned (if any) is offset, and the excess is included in the current profits and losses; others are directly
included in the current profits and losses.
35. Deferred income tax assets and deferred income tax liabilities
Income tax includes current income tax and deferred income tax. The income tax shall be included in the
current profit and loss as income tax expenses, except that the deferred income taxes related to the adjustment
of goodwill due to business merger or the transactions or matters directly included in the owner's equity are
included in the owner's equity.
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The Company recognizes deferred income tax by the balance sheet liability method according to the temporary
difference between the book value of assets and liabilities on the balance sheet date and the tax base.
Relevant deferred tax liabilities shall be recognized for each taxable temporary difference, unless the taxable
temporary difference arises from the following transactions:
(1) The initial recognition of goodwill or the initial recognition of assets or liabilities incurred in a transaction
that is not a business merger and affects neither the accounting profit nor taxable income at the time of the
transaction;
(2) Concerning the taxable temporary difference related to the investment of subsidiaries, joint ventures and
associated enterprises, the time of reversal of the temporary difference can be controlled and the temporary
difference is unlikely to be reversed in the foreseeable future.
The Company recognizes a deferred tax asset for the carry-forward of deductible temporary differences,
deductible losses and tax credits to subsequent periods, to the extent that it is probable that future taxable profits
will be available against which the deductible temporary differences, deductible losses and tax credits can be
utilized, except for those incurred in the following transactions:
(1) The transaction is not a business merger and affects neither the accounting profit nor taxable income at the
time of the transaction;
(2) Corresponding deferred tax assets are recognized if the deductible temporary difference associated with
investments in subsidiaries, associated enterprises and joint ventures meets all of the following conditions: The
temporary difference is likely to be reversed in the foreseeable future, and the taxable income which is used to
deduct the deductible temporary difference is likely to be obtained in the future.
The Company measures the deferred tax assets and deferred income tax liabilities at the applicable tax rate
during the expected period for recovering the assets or paying off the liabilities on the balance sheet date, and
reflects the impact on income tax from assets recovery or liability settlement on the balance sheet date.
At the balance sheet date, the Company reviews the book value of a deferred tax asset. If it is likely that
sufficient taxable profits will not be available in future periods to deduct the benefit of the deferred tax assets,
the book value of the deferred tax assets is reduced. Any such write-down shall be subsequently reversed where
it becomes probable that sufficient taxable income will be available.
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36. Lease
(1) Accounting method of operating leases
1) Identification of lease
On the commencement date of the contract, the Company, as the lessee or lessor, evaluates whether the
customer in the contract is entitled to obtain almost all economic benefits arising from the use of the identified
assets during the use period, and is entitled to dominate the use of the identified assets during the use period. If
one party to the contract abalienates the right to control the use of one or more identified assets within a certain
period of time in exchange for consideration, the Company determines that the contract is a lease or includes a
lease.
2) The Company as the lessee
At the commencement of the lease term, the Company recognizes right-of-use assets and lease liabilities for all
leases, except for simplified short-term leases and low-value asset leases.
For the accounting policies of the right-of-use assets, see 24 "Right-of-use Assets" in V "Significant Accounting
Policies and Accounting Estimates" of Section X "Financial Report".
Lease liabilities shall be initially measured at the present value calculated by the interest rate implicit in lease
according to the unpaid lease payment on the commencement date of the lease term. If the interest rate implicit
in lease cannot be determined, the incremental borrowing rate shall be used as the discount rate. The lease
payment includes: fixed payment and substantial fixed payment. If there is a lease incentive, the amount related
to the lease incentive shall be deducted; variable lease payments depending on index or ratio; the exercise price
of the purchase option, provided that the lessee reasonably determines that the option will be exercised;
payments for exercising the option to terminate the lease, provided that the lease term reflects that the lessee
will exercise the option to terminate the lease; and the amount expected to be paid according to the guaranteed
residual value provided by the lessee. The interest expenses of the lease liabilities within each lease term shall
be calculated subsequently according to the fixed periodic rate, and included in the current profits and losses.
Variable lease payments not included in the measurement of lease liabilities are included in the current profits
and losses when they actually occur.
Short-term lease
Short-term lease refers to the lease with a lease term of not more than 12 months on the commencement date of
the lease term, except for the lease containing the purchase option.
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The Company includes the lease payment for short-term lease into relevant asset costs or current profits and
losses by the straight-line method at each period within the lease term.
For short-term lease, the Company selects the above simplified treatment method for the items meeting the
short-term lease conditions in the following asset types according to the category of leased assets.
Low-value asset lease
Low-value asset lease refers to the lease in which the value of a single new leased asset is less than CNY 40,000.
The Company includes the payment of low-value asset lease into relevant asset costs or current profits and
losses with the straight-line method in each period within the lease term.
For low-value asset leases, the Company selects the above simplified treatment method according to the specific
conditions of each lease.
Lease change
If the lease changes and meets the following conditions at the same time, the Company takes the lease change as
a separate lease for the accounting treatment: ① The lease change expands the lease scope by increasing the
right to use one or more leased assets; and ② the increased consideration is equivalent to the amount by
adjusting the separate price of the expanded lease scope according to the contract.
If the lease change is not taken as a separate lease for accounting treatment, the Company will, on the effective
date of the lease change, reallocate the consideration of the changed contract, redetermine the lease term, and
remeasure the lease liabilities according to the changed lease payment and the present value calculated by the
revised discount rate.
If the lease scope is reduced or the lease term is shortened due to the lease change, the Company will
correspondingly reduce the book value of right-of-use assets, and include relevant profits or losses of partial or
complete termination of leasing in current profits and losses.
If the lease liabilities are remeasured due to the other lease changes, the Company shall adjust the book value of
the right-of-use asset accordingly.
3) The Company as the leaser
When the Company is the lessor, the lease that substantially transfers all risks and rewards related to the
ownership of the assets is recognized as a finance lease, and other leases than finance leases are recognized as
operating leases.
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Operating lease
Lease income from operating leases is included in current profits or losses by the Company as per the straight-
line method over the lease term. The occurred initial direct cost related to the operating lease shall be
capitalized, amortized within the lease term according to the same base with the recognition of rental income,
and included in the current profits and losses by stages. The variable lease receipts obtained by the Company
related to operating leases and not charged to the lease receipts shall be charged to the current profit and loss
when they actually occur.
Lease change
In case of any change in an operating lease, the Company carries out accounting treatment as it is a new lease
since the effective date of the change, and the advance receipts and receivables related to the lease before the
change are deemed as the receipts of the new lease.
If the financial lease changes and meets the following conditions, the Company takes the change as a separate
lease for accounting treatment: ① The change expands the lease scope by increasing the right to use one or
more leased assets; and ② the increased consideration is equivalent to the amount by adjusting the separate
price of the expanded lease scope according to the contract.
If the change of finance lease is not taken as a separate lease for accounting treatment, the Company treats the
changed lease under the following circumstances respectively: ① If the change takes effect on the
commencement date of the lease and the lease is classified as an operating lease, the Company takes it as a new
lease for accounting treatment from the effective date of the lease change, and takes the net investment in the
lease before the effective date of the lease change as the book value of the leased asset; ② if the change takes
effect on the commencement date of the lease and the lease is classified as a finance lease, the Company carries
out accounting treatment in accordance with the provisions of the ASBE No. 22 - Recognition and Measurement
of Financial Instruments on modifying or renegotiating the contract.
(2) Accounting method of finance leases
In financial lease, at the commencement of the lease term, the Company takes the net investment in a lease as
the entry value of the finance lease receivables, and the net investment in a lease is the sum of the unguaranteed
residual value and the present value of the lease receipts not yet received at the commencement of the lease
term discounted at the interest rate implicit in lease. The Company, as the lessor, calculates and recognizes
interest income in each lease term at a fixed periodic rate. The variable lease payment obtained by the Company
as the lessor and not included in the measurement of net lease investment is included in the current profits and
losses when it actually occurs.
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Derecognition and impairment of finance lease receivables are accounted for according to the ASBE No. 22 -
Recognition and Measurement of Financial Instruments and the ASBE No. 23 - Transfer of Financial Assets.
37. Changes in significant accounting policies and accounting estimates
(1) Change in significant accounting policies
□ Applicable Not applicable
(2) Change in significant accounting estimates
□ Applicable Not applicable
(3) Adjustment of relevant items in the financial statements at the beginning of the year after the first
implementation of the new accounting standards since 2023
□ Applicable Not applicable
38. Others
(1) Fair value measurement
Fair value refers to the price to be received for sale of an asset or to be paid for the transfer of liability by
market participants in the orderly transaction on the measurement date.
The Company measures related assets or liabilities at fair value, assuming that the sale of an asset or the transfer
of liability is conducted in major markets for relevant assets or liabilities in an orderly transaction. If the major
market is not provided, the transaction shall be assumed to be performed in the most favorable market for
relevant assets or liabilities. Major markets (or most favorable markets) are the markets where the Company can
enter on the measurement date. The Company uses the assumptions used by market participants to maximize
their economic benefits when they price the asset or liability.
Fair value of financial assets or financial liabilities with the active market is determined based on quotations in
the active market by the Company. Fair value of financial instrument without an active market is determined
through valuation techniques.
When non-financial assets are measured at fair value, it is required to consider the ability of market participants
to use the asset for optimal purposes to produce economic benefits, or to sell the asset to other market
participants that can use such assets for optimal purposes to produce economic benefits.
The Company shall adopt the estimation technique that is applicable in the current conditions and is supported
sufficiently by available data and other information. The relevant observable input values shall be used in
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priority during the application of estimation technique. Only when relevant observable value cannot be obtained
or can be obtained but is not feasible, the unobservable input value can be used.
For assets and liabilities measured or disclosed at fair value in the financial statements, the level to which the
fair value belongs is determined according to the lowest level input value that is of significance for the whole
fair value measurement: The input value for the first level refers to the unadjusted quotation of the same assets
or liabilities in the active market that can be obtained on the measurement date; the input value for the second
level refers to the input value that can be directly or indirectly observed for relevant assets or liabilities other
than that for the first level; and the input value for the third level refers to the input value that cannot be
observed for relevant assets or liabilities.
The Company reassesses the assets and liabilities successively measured at fair value recognized in financial
statements on each balance sheet date to determine the transition among fair value measurement levels.
(2) Contract cost
The contract cost includes the incremental cost incurred for obtaining a contract and the contract performance
cost.
Incremental costs incurred for obtaining a contract refer to the costs (such as sales commissions) that would not
have occurred if the Company had not obtained the contract. If the cost is expected to be recovered, the
Company recognizes it as a contract acquisition cost and an asset. Other expenditures incurred by the Company
for obtaining contracts other than incremental costs that are expected to be recovered are included in current
profits and losses when incurred.
If the cost incurred for contract performance is not within the scope of other accounting standards for business
enterprises such as inventories and meets the following conditions at the same time, the Company recognizes it
as an asset for the contract performance cost:
① The cost is directly related to a current or expected contract, including direct labor, direct materials,
manufacturing costs (or similar costs), the costs clearly borne by the customer, and other costs incurred only by
the Contract;
② This cost increases the Company’s resources for performing the performance obligations in the future;
③ This cost is expected to be recovered.
Assets recognized as contract acquisition costs and that recognized as contract performance costs (hereinafter
referred to as "assets related to contract costs") are amortized on the same basis as revenue recognition of goods
or services related to the assets and are included in current profits and losses. If the amortization period does not
exceed one year, it shall be included in the current profits and losses when it occurs.
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When the book value of the assets related to the contract cost is higher than the difference between the
following two items, the Company will make provision for the impairment of the excess and recognize it as the
asset impairment loss:
① The residual consideration expected to be obtained by the Company from the transfer of goods or services
related to the asset;
② The estimated costs to be incurred for the transfer of relevant goods or services.
The contract performance cost recognized as an asset shall be listed in the "inventory" item if its amortization
period does not exceed one year or a normal operating cycle at initial recognition, and shall be listed in the
"other non-current assets" item if its amortization period exceeds one year or a normal operating cycle at initial
recognition.
The contract acquisition cost recognized as an asset shall be listed in the item "Other current assets" if the
amortization period at the time of initial recognition is not more than one year or one normal operating cycle,
and listed in the item "Other non-current assets" if the amortization period at the time of initial recognition is
more than one year or one normal operating cycle.
(3) Work safety cost and maintenance & renovation cost
The Company withdraws the work safety cost month by month in an average manner by taking the method of
excess regression based on the actual operating income of the previous year according to the provisions of CZ
[2022] No. 136 document. The specific standards are as follows:
For the machinery manufacturing enterprises with an operating income of not exceeding CNY 10 million, 2.35%
of work safety cost will be withdrawn; for the part of operating income between CNY 10 million and CNY 100
million, 1.25% will be withdrawn; for the part of the operating income between CNY 100 million and CNY 1
billion, 0.25% will be withdrawn; for the part of the operating income between CNY 1 billion and CNY 5
billion, 0.1% will be withdrawn; for the part of the operating income over CNY 5 billion, 0.05% will be
withdrawn.
For transportation enterprises, the work safety cost is withdrawn month by month in an average manner
according to the following standards based on the actual operating income in the previous year: 1% for ordinary
freight business; 1.5% for passenger transportation, pipeline transportation, dangerous goods transportation and
other special freight businesses.
Work safety cost and maintenance & renovation cost are included in the cost of relevant products or the current
profit and loss when withdrawn, and are also included in the "special reserve" account.
For the withdrawn work safety cost and maintenance & renovation cost used within the specified scope, those
belong to expense expenditures are directly offset by specific reserves; those cost incurred via collection under
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the item of “construction in progress” is recognized when the safety project completes and is ready for intended
use. At the same time, the Company will offset the specific reserves according to the cost that formed fixed
assets and determine the accumulated depreciation of the same amount. The fixed assets will no longer be
depreciated in subsequent periods.
(4) Repurchase of shares
Shares repurchased by the Company are managed as treasury shares before being canceled or transferred, and
all expenditures on repurchased shares are transferred to treasury share costs. Considerations in the payment for
shares repurchase and reduced owner’s equity in transaction expenses are not recognized as profits or losses
during repurchase, assignment and write-off of the Company's shares.
The transferred treasury shares are included in the capital reserve based on the difference between the amount
actually received and the book value of the treasury shares. The surplus reserve and undistributed profits shall
be offset if the capital reserve is insufficient to offset. The canceled treasury shares are used to offset the capital
reserve based on the difference between the book balance and the face value of the canceled treasury shares by
reducing the share capital according to the face value of the shares and the number of canceled shares. The
surplus reserve and undistributed profits shall be offset if the capital reserve is insufficient to offset.
(5) Restricted shares
The Company grants restricted shares to the incentive objects in the equity incentive plan, and the incentive
objects subscribe for the shares preferentially. If the unlocking conditions stipulated in the equity incentive plan
are not met subsequently, the Company will repurchase the shares at the price agreed in advance. If the
restricted shares issued to employees have completed capital increase procedures such as registration as
specified, the Company shall determine the share capital and capital reserve (share premium) according to the
share subscription money received from employees on the granting date, and determine the treasury shares and
other payables in terms of the repurchase obligation.
(6) Asset impairment
The asset impairment of long-term equity investment to subsidiaries and associated enterprises, investment real
estates subsequently measured by cost model, fixed assets, project under construction, right-of-use assets,
intangible assets, etc. (except for inventories, deferred income tax assets and financial assets) is recognized with
the following methods:
The Company judges whether there is a sign of impairment to assets on the balance sheet date. If such a sign
exists, the Company estimates the recoverable amount and conducts the impairment test. Impairment tests shall
be carried out every year on goodwill resulting from business mergers, intangible assets with uncertain service
life and intangible assets that are not available no matter whether there is any sign of impairment.
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The recoverable amount is the net amount of the fair value of the assets after deducting the disposal expenses or
the present value of the expected future cash flow of the assets, whichever is higher. The Company estimates
the recoverable amount based on a single asset. If it is difficult to estimate the recoverable amount of a single
asset, the recoverable amount of the asset group shall be determined based on the asset group to which the asset
belongs. An asset group is determined based on the fact that the main cash inflows generated by the asset group
are independent of the cash inflows of other assets or asset groups.
When the recoverable amount of an asset or asset group is lower than its book value, the Company writes down
its book value to the recoverable amount, and the write-down amount is included in current profits and losses,
and the corresponding impairment provision of assets is made at the same time.
For the impairment test of goodwill, the book value of goodwill resulting from business merger is amortized to
relevant asset groups with reasonable methods from the acquisition date, or amortized to relevant asset group
portfolio if it is difficult to amortize it to relevant asset groups. Relevant asset groups or portfolios of asset
groups are those that can benefit from the synergies of business merger and are not greater than the reporting
segment determined by the Company.
If there is any sign of impairment in the asset group or portfolio of asset groups related to goodwill during the
impairment test, the impairment test shall be carried out on the asset group or portfolio of asset groups not
including goodwill, and the recoverable amount shall be calculated to determine the corresponding impairment
loss. Then, an impairment test is carried out on the asset group or portfolio of asset groups including goodwill to
compare its book value and recoverable amount, and determine the impairment loss of goodwill if the
recoverable amount is lower than the book value.
Once the impairment loss of assets is determined, it will never be reversed in subsequent accounting periods.
(7) Significant accounting judgment and estimate
The Company continuously evaluates the significant accounting estimates and key assumptions adopted based
on historical experience and other factors, including reasonable expectations for future events. Significant
accounting estimates and key assumptions that may lead to significant adjustment risk to the book value of
assets and liabilities in the next accounting year are presented as follows:
Classification of financial assets
Major judgments involved in determining the classification of financial assets include the analysis of business
models and contractual cash flow characteristics.
The Company determines the business model of managing financial assets at the level of financial asset
portfolio, considering the way of evaluating and reporting financial asset performance to key management
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personnel, the risks affecting the financial asset performance and their management methods, and the way for
the relevant business management personnel to obtain the remuneration.
When evaluating whether the contractual cash flow of financial assets is consistent with the basic loan
arrangement, the Company has the following main judgments: May the principal change in the time distribution
or amount in the duration due to prepayment and other reasons? Does the interest include only the time value of
money, credit risk, other basic borrowing risks, and consideration for costs and profits? For example, does the
amount of prepayment only reflect the unpaid principal and interest based on the outstanding principal, as well
as reasonable compensation paid due to early termination of the contract?
Measurement of expected credit losses on accounts receivable
The Company calculates the expected credit loss of accounts receivable through default risk exposure and
expected credit loss rate of accounts receivable, and determines the expected credit loss rate based on default
probability and loss given default. In determining the expected credit loss rate, the Company uses the internal
historical credit loss experience and other data, and adjusts the historical data according to the current situation
and forward-looking information. When the forward-looking information is considered, the indicators used by
the Company include risks of economic downturn, changes in external market environment, technological
environment and customer conditions. The Company regularly monitors and reviews the assumptions related to
the calculation of expected credit losses.
Development expenditures
In determining the capitalization amounts, the management must make assumptions on the expected future cash
flow generation of assets, discount rate to be adopted and expected benefit period.
Deferred income tax assets
The deferred tax assets shall be recognized in respect of all unused tax losses to the extent it is highly probable
that there will be sufficient taxable profits available for offsetting the losses. This requires the management to
estimate the timing and amount of future taxable profit using large amounts of judgment and to determine the
recognized amount of deferred tax assets by referring to the tax planning strategy.
Estimated liabilities
Expected liabilities are initially measured at the optimal estimate required to perform the relevant current
obligation, in comprehensive consideration of the risks, uncertainty, time value of money, and other factors
pertinent to the Contingencies. The best estimate is determined by discounting the relevant future cash outflow
if the time value of money has a significant impact. At the balance sheet date, the book value of the estimated
liabilities is reviewed and adjusted by the Company to reflect the current best estimate.
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If all or part of the expenditures necessary for clearing off the recognized provisions are expected to be
compensated by a third party or any other party, the amount of compensation shall be recognized as assets
separately only when it is basically sure that the amount can be obtained. The recognized amount of
compensation shall not exceed the book value of recognized liabilities.
VI. Taxes
1. Main taxes and tax rates
Tax Category Tax Basis Tax Rate
Taxable value-added tax (the tax payable is calculated by
multiplying taxable sales by the applicable tax rate and
VAT 13%, 9%, 6%, 5%
then deducting input tax allowed to be deducted for the
current period)
Urban
maintenance and Turnover tax actually paid 7%, 5%
construction tax
Corporate income
Taxable income 25%
tax
Local educational
Turnover tax actually paid 2%
surcharges
Education
Turnover tax actually paid 3%
surcharges
CNY 9/㎡, CNY 14/㎡,
Land use tax Land use area
etc.
Property tax Property residual value and rental income 1.2%, 12%
Disclosure of different corporate income tax rates for taxable entities
Name of Taxpayer Income Tax Rate
The Company 25%
Jiefang Limited 15%
Wuxi Dahao Power Co., Ltd. 25%
FAW Jiefang (Qingdao) Automotive Co., Ltd. 25%
FAW Jiefang Dalian Diesel Engine Co., Ltd. 15%
FAW Jiefang Austria R&D Co., Ltd. 25%
FAW Jiefang New Energy Automotive Sales Co., Ltd. 25%
FAW Jiefang Uni-D (Tianjin) Technology Industry
25%
Co., Ltd.
2. Tax preference
Jiefang Limited, a subsidiary of the Company, is recognized as a high-tech enterprise according to the High-
tech Enterprise Certificate (issued on September 10, 2020, with a certificate number of GR202022000336)
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jointly issued by the Science and Technology Department of Jilin Province, the Department of Finance of Jilin
Province and the Jilin Provincial Tax Service of State Taxation Administration. The certificate is valid for three
years, during which the corporate income tax will be at a rate of 15%.
FAW Jiefang Dalian Diesel Engine Co., Ltd., a subsidiary of the Company, is recognized as a high-tech
enterprise according to the list of the third batch of high-tech enterprises (with a certificate number of
GR202121200892) in 2021 issued by Dalian on December 15, 2021. The certificate is valid for three years,
during which the corporate income tax will be at a rate of 15%.
VII. Notes to Items in Consolidated Financial Statements
1. Monetary capital
Unit: CNY
Item Ending Balance Opening Balance
Bank deposit 26,687,673,489.67 20,992,347,381.12
Other monetary capital 49,662,510.03 49,126,036.59
Total 26,737,335,999.70 21,041,473,417.71
Including: total amount deposited abroad 13,647,096.14 13,903,726.95
Total amount with limited use due to
51,206,388.53 50,667,983.38
mortgage, pledge or freezing
Other description
Details of restricted monetary capital are as follows:
Unit: CNY
Item Ending Balance Beginning Balance
Security deposit for three types of personnel 27,565,092.10 27,077,797.58
Housing maintenance fund 22,097,418.52 22,048,239.01
Court freezing 1,543,877.91 1,541,946.79
Total 51,206,388.53 50,667,983.38
2. Notes receivable
(1) Classified presentation of notes receivable
Unit: CNY
Item Ending Balance Opening Balance
Commercial acceptance notes 199,257,997.67 186,748,716.22
Total 199,257,997.67 186,748,716.22
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Unit: CNY
Ending Balance Opening Balance
Book Balance Provision for Bad Debts Book balance Provision for Bad Debts
Category
Provision Book value Provision Book Value
Amount Scale Amount Amount Scale Amount
Proportion Proportion
Notes receivable
with provision
200,128,605.00 100.00% 870,607.33 0.44% 199,257,997.67 187,550,142.00 100.00% 801,425.78 0.43% 186,748,716.22
for bad debts by
portfolio
Including:
Commercial
200,128,605.00 100.00% 870,607.33 0.44% 199,257,997.67 187,550,142.00 100.00% 801,425.78 0.43% 186,748,716.22
acceptance bill
Total 200,128,605.00 100.00% 870,607.33 0.44% 199,257,997.67 187,550,142.00 100.00% 801,425.78 0.43% 186,748,716.22
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Provision for bad debts by portfolio: commercial acceptance bill
Unit: CNY
Ending Balance
Name
Book Balance Provision for Bad Debts Provision Proportion
Less than one year 200,128,605.00 870,607.33 0.44%
Total 200,128,605.00 870,607.33
Description of the basis for determining this portfolio:
Information about the provision for bad debts shall be disclosed in the same way as that of other receivables if
the provision for bad debts of notes receivable is based on the general model of expected credit losses:
Applicable □ Not applicable
Unit: CNY
Ending Balance Ending Balance of the Previous Year
Aging Expected Provision Expected
Notes Provision for Notes
Credit Loss for Bad credit Loss
Receivable Bad Debts Receivable
Rate (%) Debts RATE (%)
Less than 1
year 200,128,605 .00 870,607.33 0.44 187,550,142.00 801,425.78 0.43
(2) Provision, recovery, or reversal of bad debts in the current period
Provision for bad debts in the current period:
Unit: CNY
Change In The Current Period Ending
Category Opening Balance
Provision Recovery or Reversal Write-off Others Balance
Commercial
801,425.78 69,181.55 870,607.33
acceptance bill
Total 801,425.78 69,181.55 870,607.33
Important provision for bad debts recovered or reversed in the current period:
□ Applicable Not applicable
(3) Notes receivable endorsed or discounted by the Company at the end of the period but not yet due on
the balance sheet date
Unit: CNY
Derecognized Amount at the End Amount not Derecognized at the
Item
of the Period End of the Period
Bank acceptance bill 7,693,661,864.75
Total 7,693,661,864.75
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3. Accounts receivable
(1) Disclosure of accounts receivable by category
Unit: CNY
Ending Balance Opening Balance
Book Balance Provision for Bad Debts Book Balance Provision for Bad Debts
Category
Provision Book value Provision Book Value
Amount Scale Amount Amount Scale Amount
Proportion Proportion
Accounts
receivable
with provision
for bad debts 82,004,650.69 2.72% 82,004,650.69 100.00% 82,039,650.69 8.10% 82,039,650.69 100.00%
on an
individual
basis
Including:
Accounts
receivable
with provision 2,929,802,288.92 97.28% 95,574,585.34 3.26% 2,834,227,703.58 930,458,334.81 91.90% 63,367,996.39 6.81% 867,090,338.42
for bad debts
by portfolio
Including:
Aging
2,929,802,288.92 97.28% 95,574,585.34 3.26% 2,834,227,703.58 930,458,334.81 91.90% 63,367,996.39 6.81% 867,090,338.42
portfolio
Total 3,011,806,939.61 100.00% 177,579,236.03 5.90% 2,834,227,703.58 1,012,497,985.50 100.00% 145,407,647.08 14.36% 867,090,338.42
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Provision for bad debts on an individual basis
Unit: CNY
Ending Balance
Name Provision for Provision
Book Balance Reasons for Provision
Bad Debts Proportion
It is highly probable that
Jiangsu Xinrui New Energy Vehicle
37,612,001.70 37,612,001.70 100.00% the amounts will not be
Technology Co., Ltd.
recovered
It is highly probable that
Zhejiang Hanglun Ligang Trading Co.,
8,581,536.83 8,581,536.83 100.00% the amounts will not be
Ltd.
recovered
It is highly probable that
Dalian Qingfeng Bus Co., Ltd. 8,043,264.87 8,043,264.87 100.00% the amounts will not be
recovered
It is highly probable that
Beijing Hotan Automobile Modification
7,436,520.00 7,436,520.00 100.00% the amounts will not be
Co., Ltd.
recovered
It is highly probable that
Changchun Xiongtu New Energy
6,230,500.00 6,230,500.00 100.00% the amounts will not be
Vehicle Co., Ltd.
recovered
It is highly probable that
Zhonghe Shunyang Supply Chain
5,643,600.00 5,643,600.00 100.00% the amounts will not be
Management Co., Ltd.
recovered
Lawsuits have been filed
Shuozhou Jinsheng Automobile Trading and it is highly probable
1,822,961.43 1,822,961.43 100.00%
Co., Ltd. that the amounts will not
be recovered
It is highly probable that
FAW Jingye Engine Co., Ltd. 1,820,957.23 1,820,957.23 100.00% the amounts will not be
recovered
Lawsuits have been filed
Xinjiang Jingyang Optoelectronic Co., and it is highly probable
1,179,590.41 1,179,590.41 100.00%
Ltd. that the amounts will not
be recovered
Lawsuits have been filed
Yulin Jiayu Jiefang Automobile Sales and it is highly probable
971,012.59 971,012.59 100.00%
Co., Ltd. that the amounts will not
be recovered
Lawsuits have been filed
Shenyang Jinbei Vehicle Manufacturing and it is highly probable
889,279.05 889,279.05 100.00%
Co., Ltd. that the amounts will not
be recovered
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It is highly probable that
Jilin Zhuzhan Automobile Trading Co.,
813,566.00 813,566.00 100.00% the amounts will not be
Ltd.
recovered
It is highly probable that
Dalian Baofeng Automobile Sales Co.,
496,200.00 496,200.00 100.00% the amounts will not be
Ltd.
recovered
It is highly probable that
Liangshan Huatai Trading Co., Ltd. 349,190.00 349,190.00 100.00% the amounts will not be
recovered
It is highly probable that
Zhejiang Baoding Automobile Sales
80,035.12 80,035.12 100.00% the amounts will not be
Co., Ltd.
recovered
Transportation Group (Qingdao) It is highly probable that
Sunshine Automobile Sales and Service 20,835.47 20,835.47 100.00% the amounts will not be
Co., Ltd. recovered
It is highly probable that
Yancheng Zhongwei Bus Co., Ltd. 13,599.99 13,599.99 100.00% the amounts will not be
recovered
Total 82,004,650.69 82,004,650.69
Provision for bad debts by portfolio: aging portfolio
Unit: CNY
Ending Balance
Name
Book Balance Provision for Bad Debts Provision Proportion
Aging portfolio 2,929,802,288.92 95,574,585.34 3.26%
Total 2,929,802,288.92 95,574,585.34
Description of the basis for determining this portfolio:
Information about the provision for bad debts shall be disclosed in the same way as that of other receivables if
the provision for bad debts of accounts receivable is based on the general model of expected credit losses:
□ Applicable Not applicable
Disclosure by aging
Unit: CNY
Aging Ending Balance
Within 1 year (including 1 year) 2,708,181,856.35
Including: 0-6 months 2,587,976,078.45
7-12 months 120,205,777.90
1-2 years 113,283,606.25
2-3 years 88,363,727.05
Over 3 years 101,977,749.96
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3-4 years 10,332,160.65
4-5 years 57,808,221.70
Over 5 years 33,837,367.61
Total 3,011,806,939.61
(2) Provision, recovery, or reversal of bad debts in the current period
Provision for bad debts in the current period:
Unit: CNY
Change in the Current Period
Category Opening Balance Recovery or Write- Ending Balance
Provision Others
Reversal off
Accounts
145,407,647.08 32,229,937.26 -35,000.00 -23,348.31 177,579,236.03
receivable
Total 145,407,647.08 32,229,937.26 -35,000.00 -23,348.31 177,579,236.03
Important provision for bad debts recovered or reversed in the current period:
Unit: CNY
Name of Unit Amount Recovered or Reversed Recovery Method
Jilin Zhuzhan Automobile Trading Co., Ltd. 35,000.00 Recovery of bank deposits
Total 35,000.00
(3) Top five ending balances of accounts receivables classified by debtors
Unit: CNY
Ending Balance of Proportion in Total Ending Ending Balance of
Name of Unit
Accounts Receivable Balance of Accounts Receivable Provision for Bad Debts
China FAW Group Import
1,465,254,854.26 48.65% 4,069,205.50
& Export Co., Ltd.
Customer 1 104,405,019.49 3.47% 104,405.02
Customer 2 89,891,796.82 2.98% 494,404.88
Customer 3 74,631,860.98 2.48% 410,475.23
SmartLink 73,770,000.00 2.45% 73,770.00
Total 1,807,953,531.55 60.03%
4. Receivables financing
Unit: CNY
Item Ending Balance Opening Balance
Notes receivable 8,679,460,881.09 3,461,653,473.66
Total 8,679,460,881.09 3,461,653,473.66
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Increase/decrease in receivables financing in the current period and changes in fair value
□ Applicable Not applicable
Information about the impairment provision shall be disclosed in the same way as that of other receivables if the
impairment provision of receivables financing is based on the general model of expected credit losses:
□ Applicable Not applicable
Other description:
5. Advance payment
(1) Presentation of advance payment by aging
Unit: CNY
Ending Balance Opening Balance
Aging
Amount Scale Amount Scale
Within 1 year 613,755,653.26 65.41% 683,392,293.37 76.12%
1-2 years 224,579,144.53 23.94% 179,765,899.07 20.02%
2-3 years 81,816,802.05 8.72% 17,802,947.31 1.98%
Over 3 years 18,074,079.50 1.93% 16,873,724.33 1.88%
Total 938,225,679.34 897,834,864.08
Reasons for delay in settlement of advance payment with important amounts and aging over 1 year:
Unit: CNY
Proportion in Total Advance
Name of Debtor Book Balance Reasons for Non-settlement
Payment (%)
Supplier 1 51,521,752.55 5.49% Undue settlement period
Supplier 2 24,390,033.00 2.60% Undue settlement period
China FAW Group Import &
14,068,905.82 1.50% Undue settlement period
Export Co., Ltd.
Total 89,980,691.37 9.59% --
(2) Top five ending balances of advance payments classified by advance payment objects
The total amount of the top five ending balances of advance payments classified by advance payment objects in
the current period is CNY 508,101,980.83, accounting for 54.16% of the total ending balance of advance
payments.
Other description: none
6. Other receivables
Unit: CNY
Item Ending Balance Opening Balance
Dividends receivable 2,608,000.00 2,608,000.00
Other receivables 1,113,417,414.02 1,065,846,162.91
Total 1,116,025,414.02 1,068,454,162.91
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(1) Dividends receivable
1) Classification of dividends receivable
Unit: CNY
Item (or Investee) Ending Balance Opening Balance
FAW Changchun Ansteel Steel
2,608,000.00 2,608,000.00
Processing and Distribution Co., Ltd.
Total 2,608,000.00 2,608,000.00
(2) Other receivables
1) Classification of other receivables by nature
Unit: CNY
Nature Ending Book Balance Beginning Book Balance
Current account 849,945,010.62 915,518,158.63
Claim payment 192,234,059.14 197,953,339.79
Margin, deposit 156,005,961.05 38,988,831.99
Reserve fund 12,277,298.01 10,164,463.79
Total 1,210,462,328.82 1,162,624,794.20
2) Provision for bad debts
Unit: CNY
Stage I Stage II Stage III
Expected Credit
Expected Credit Expected Credit
Loss over the
Provision for Bad Debts Losses for the Losses over the Total
Entire Duration
Next 12 Entire Duration (no
(Credit Impairment
Months Credit Impairment)
Occurred)
Balance on January 1, 2023 3,002,964.74 25,052,575.21 68,723,091.34 96,778,631.29
Balance on January 1, 2023 in
the current period
一 Transfer to stage III -18,017.98 18,017.98
Provision in the current period 128,149.83 150,420.77 34,373.91 312,944.51
Reversal in the current period -46,661.00 -46,661.00
Balance on June 30, 2023 3,113,096.59 25,221,013.96 68,710,804.25 97,044,914.80
Significant book balance changes occurred in the provision for losses in the current period
□ Applicable Not applicable
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Disclosure by aging
Unit: CNY
Aging Ending Balance
Within 1 year (including 1 year) 1,110,680,286.67
Including: 0-6 months 328,564,342.04
7-12 months 782,115,944.63
1-2 years 1,394,251.04
2-3 years 4,744,941.00
Over 3 years 93,642,850.11
3-4 years 234,122.89
4-5 years 42,254,223.90
Over 5 years 51,154,503.32
Total 1,210,462,328.82
3) Provision, recovery, or reversal of bad debts in the current period
Provision for bad debts in the current period:
Unit: CNY
Change in the Current Period
Category Opening Balance Recovery or Ending Balance
Provision Write-off Others
reversal
Other
96,778,631.29 312,944.51 -24,131.00 -22,530.00 97,044,914.80
receivables
Total 96,778,631.29 312,944.51 -24,131.00 -22,530.00 97,044,914.80
Important provision for bad debts reversed or recovered in the current period:
Unit: CNY
Name of Unit Amount reversed or Recovered Recovery Method
Triangle Tyre Co,. Ltd. 24,131.00 Offset of intercourse funds
Total 24,131.00
(4) Other receivables written off in the current period
Unit: CNY
Item Amount Written off
Other accounts receivables actually written off 22,530.00
153
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Write-off of other important receivables:
Unit: CNY
Whether the
Nature of Write-off
Amount Written Payment Arises
Name of Unit Other Reason for Write-off Procedures
off from Related
receivables Performed
transactions
This company General
Huai'an
Payment for declares bankruptcy manager's
Yongfeng Tire 22,530.00 No
goods and has no meeting for
Co., Ltd.
enforceable property decisions
Total 22,530.00
Notes on write-off of other receivables:
5) Top five ending balances of other receivables classified by debtors
Unit: CNY
Proportion in
Ending Balance
Name of Total Ending
Nature of Payment Ending Balance Aging of Provision for
Unit Balance of Other
Bad Debts
Receivables
Customer Funds for land
660,862,800.00 Within 1 year 54.60% 660,862.80
1 purchase and reserve
Customer New energy vehicle
50,230,088.50 Within 1 year 4.15% 462,116.81
2 sales subsidies
Customer New energy vehicle
49,557,522.13 Within 1 year 4.09% 455,929.20
3 sales subsidies
Customer New energy vehicle
48,155,960.00 4-5 years 3.98% 48,155,960.00
4 sales subsidies
Customer New energy vehicle
37,899,115.04 Within 1 year 3.13% 348,671.86
5 sales subsidies
Total 846,705,485.67 69.95% 50,083,540.67
7. Inventories
Does the Company need to comply with the disclosure requirements of the real estate industry: No
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(1) Classification of inventories
Unit: CNY
Ending Balance Opening Balance
Item Impairment Provision of Impairment Provision of
Book Balance Inventories or Contract Book Value Book Balance Inventories or Contract Book Value
Performance Costs Performance Costs
Raw material 342,773,084.37 33,976,539.91 308,796,544.46 351,801,254.38 34,595,186.53 317,206,067.85
Goods in process 768,115,132.21 4,068,162.22 764,046,969.99 564,240,295.08 3,741,307.32 560,498,987.76
Goods in stock 4,114,689,772.13 102,394,726.26 4,012,295,045.87 3,281,304,875.32 183,152,615.52 3,098,152,259.80
Revolving material 93,898,085.73 2,415,110.66 91,482,975.07 92,939,661.90 2,463,306.64 90,476,355.26
Others 2,836,319,710.97 181,499,178.14 2,654,820,532.83 2,509,560,166.91 193,153,939.75 2,316,406,227.16
Total 8,155,795,785.41 324,353,717.19 7,831,442,068.22 6,799,846,253.59 417,106,355.76 6,382,739,897.83
(2) Impairment provision of inventories and contract performance costs
Unit: CNY
Increase in the Current Period Decrease in the Current Period
Item Opening Balance Reverse or Charge- Ending Balance
Provision Others Others
off
Raw material 34,595,186.53 618,646.62 33,976,539.91
Goods in process 3,741,307.32 612,662.79 285,807.89 4,068,162.22
Goods in stock 183,152,615.52 34,263,632.69 115,021,521.95 102,394,726.26
Revolving material 2,463,306.64 48,195.98 2,415,110.66
Others 193,153,939.75 305,863.22 11,960,624.83 181,499,178.14
Total 417,106,355.76 35,182,158.70 127,934,797.27 324,353,717.19
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8. Contract assets
Unit: CNY
Ending Balance Opening Balance
Item Impairment Impairment
Book Balance Book Value Book Balance Book Value
Provision Provision
Contract
20,192,395.26 353,811.04 19,838,584.22 11,341,422.54 211,797.79 11,129,624.75
assets
Total 20,192,395.26 353,811.04 19,838,584.22 11,341,422.54 211,797.79 11,129,624.75
Information about the impairment provision shall be disclosed in the same way as that of other receivables if the
impairment provision of contract assets is based on the general model of expected credit losses:
Applicable □ Not applicable
Provision for bad debts by portfolio: aging portfolio
Unit: CNY
Expected Credit Loss Rate
Category Contract Assets Provision for Bad Debts
(%)
Within 1 year 17,191,667.90 65,751.33 0.38
1-2 years 3,000,727.36 288,059.71 9.60
Total 20,192,395.26 353,811.04 1.75
Impairment provision of contract assets in the current period:
Unit: CNY
Charge-off/Write-off
Provision in the Reversal in the
Item in the Current Reason
Current Period Current Period
Period
Impairment provision Risks in payment
142,013.25
of contract assets collection
Total 142,013.25
Other description
9. Non-current assets due within one year
Unit: CNY
Item Ending Balance Opening Balance
Long-term receivables due within 1 year 202,027,832.48 191,262,030.30
Total 202,027,832.48 191,262,030.30
10. Other current assets
Unit: CNY
Item Ending Balance Opening Balance
Input VAT 436,429,149.81 510,325,627.83
Input VAT to be certified 240,680,761.48 384,601,871.76
Total 677,109,911.29 894,927,499.59
Other description:
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11 Long-term receivables
(1) Long-term receivables
Unit: CNY
Ending Balance Opening Balance Discount
Item Provision for Provision for Rate
Book Balance Book Value Book Balance Book Value
Bad Debts Bad Debts Range
Sales of goods by
329,561,172.00 5,798,130.40 323,763,041.60 315,738,954.37 2,870,336.64 312,868,617.73
installment
Long-term receivables due
-207,270,278.41 -5,242,445.93 -202,027,832.48 -193,577,418.87 -2,315,388.57 -191,262,030.30
within 1 year
Total 122,290,893.59 555,684.47 121,735,209.12 122,161,535.50 554,948.07 121,606,587.43
Impairment of provision for bad debts
Unit: CNY
Stage I Stage II Stage III
Expected credit Losses over Expected credit Loss over
Provision for Bad Debts Expected credit Losses for Total
the entire Duration (no Credit the entire Duration (Credit
the next 12 Months
Impairment) Impairment Occurred)
Balance on January 1, 2023 2,870,336.64 2,870,336.64
Balance on January 1, 2023 in the
current period
Provision in the current period 2,927,793.76 2,927,793.76
Balance on June 30, 2023 5,798,130.40 5,798,130.40
Significant book balance changes occurred in the provision for losses in the current period
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□ Applicable Not applicable
12 Long-term equity investments
Unit: CNY
Increase/Decrease in the Current Period
Investment Ending
Cash
Opening Balance Gains or Adjustment to Ending Balance Balance of
Investee Changes Dividends
(Book Value) Additional Reduced Losses other Impairment (Book Value) Impairment
in Other and Profits Others
Investment Investment Recognized Comprehensive Provision Provision
Equity Declared to
under the Income
Pay
Equity Method
I. Joint ventures
II. Associated enterprises
First
Automobile
4,270,037,969.59 228,656,115.49 258,953.96 4,498,953,039.04
Finance
Co., Ltd.
Sanguard
Automobile
201,021,162.24 3,906,929.80 -4,533.20 4,835,877.87 200,087,680.97
Insurance
Co., Ltd.
FAW
Changchun
Ansteel
Steel -
87,066,229.18 1,698,509.34 88,740,965.84
Processing 23,772.68
and
Distribution
Co., Ltd.
Changchun 17,288,166.13 -368,632.80 16,919,533.33
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Wabco
Automotive
Control
System
Co., Ltd.
Suzhou
Zhito
Technology
Co., Ltd.
FAW
Changchun
Baoyou
Jiefang
Steel 43,856,468.58 3,203,595.58 6,892,912.77 40,167,151.39
Processing
and
Distribution
Co., Ltd.
FAW
Jiefang
Fujie
(Tianjin) 37,092,567.41 -118,756.81 36,973,810.60
Technology
Industry
Co., Ltd.
SmartLink 286,072.71 9,266,800.00 -9,552,872.71
Foshan
Diyiyuan 36,000,000.00 -302,925.22 35,697,074.78
New
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Energy
Technology
Co., Ltd.
Jiefang
Times New
Energy 45,000,000.00 -181,500.00 44,818,500.00
Technology
Co., Ltd.
Changchun
Automotive
670,872,897.94 6,235,810.40 677,108,708.34
Test Center
Co., Ltd.
-
Subtotal 4,692,648,635.84 725,139,697.94 233,176,273.07 254,420.76 11,728,790.64 5,639,466,464.29
23,772.68
-
Total 4,692,648,635.84 725,139,697.94 233,176,273.07 254,420.76 11,728,790.64 5,639,466,464.29
23,772.68
Other description
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13 Investment in other equity instruments
Unit: CNY
Item Ending Balance Opening Balance
REFIRE 480,780,000.00 480,780,000.00
Total 480,780,000.00 480,780,000.00
14. Investment properties
(1) Investment properties measured at cost
Applicable □ Not applicable
Unit: CNY
Houses and Project under
Item Land Use Right Total
Buildings Construction
I. Original book value
1. Opening Balance 145,745,882.84 7,364,400.94 153,110,283.78
2. Increase in the Current
1,836,578.74 1,836,578.74
Period
(1) Purchase
(2) Transfer from
inventories/fixed 1,836,578.74 1,836,578.74
assets/construction in progress
(3) Increase due to
business combination
3. Decrease in the Current
2,927,421.41 2,927,421.41
Period
(1) Disposal
(2) Other transfer-out 2,927,421.41 2,927,421.41
4. Ending Balance 144,655,040.17 7,364,400.94 152,019,441.11
II. Accumulated depreciation and
accumulated amortization
1. Opening Balance 71,218,610.71 1,244,075.59 72,462,686.30
2. Increase in the Current
5,040,873.89 74,947.92 5,115,821.81
Period
(1) Provision or
3,487,312.86 74,947.92 3,562,260.78
amortization
(2) Other increases 1,553,561.03 1,553,561.03
3. Decrease in the Current
1,430,556.04 1,430,556.04
Period
161
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(1) Disposal
(2) Other transfer-out 1,430,556.04 1,430,556.04
4. Ending Balance 74,828,928.56 1,319,023.51 76,147,952.07
III. Impairment provision
1. Opening Balance
2. Increase in the Current
Period
(1) Provision
3. Decrease in the Current
Period
(1) Disposal
(2) Other transfer-out
4. Ending Balance
IV. Book value
1. Ending book value 69,826,111.61 6,045,377.43 75,871,489.04
2. Beginning book value 74,527,272.13 6,120,325.35 80,647,597.48
(2) Investment properties measured at fair value
□ Applicable Not applicable
15 Fixed assets
Unit: CNY
Item Ending Balance Opening Balance
Fixed assets 9,722,689,355.68 9,604,636,127.53
Disposal of fixed assets 6,084,530.20 8,286,682.75
Total 9,728,773,885.88 9,612,922,810.28
162
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(1) Details of fixed assets
Unit: CNY
Houses and Machinery Transportation Electronic Office
Item Others Total
Buildings Equipment Equipment Equipment Equipment
I. Original book value:
1. Opening Balance 5,725,009,716.16 15,656,156,281.82 163,214,691.23 662,116,184.02 60,661,288.33 1,331,905,071.36 23,599,063,232.92
2. Increase in the
108,671,482.61 906,448,079.26 16,338,028.90 29,574,306.89 1,616,140.53 4,427,908.05 1,067,075,946.24
Current Period
(1) Purchase 13,771.81 15,046,441.18 560,724.98 10,920,472.84 19,512.17 1,427,091.85 27,988,014.83
(2) Transfer from
84,998,544.20 835,134,183.48 13,862,727.14 17,062,332.04 832,998.51 2,196,658.79 954,087,444.16
construction in progress
(3) Increase due to
business combination
(4) Other increases 23,659,166.60 56,267,454.60 1,914,576.78 1,591,502.01 763,629.85 804,157.41 85,000,487.25
3. Decrease in the
177,421,665.73 227,747,840.72 3,783,183.84 8,440,837.29 1,095,750.11 5,031,659.11 423,520,936.80
Current Period
(1) Disposal or
157,464,159.65 683,585.61 4,107,063.76 255,612.81 4,004,419.43 166,514,841.26
retirement
(2) Other decreases 177,421,665.73 70,283,681.07 3,099,598.23 4,333,773.53 840,137.30 1,027,239.68 257,006,095.54
4. Ending Balance 5,656,259,533.04 16,334,856,520.36 175,769,536.29 683,249,653.62 61,181,678.75 1,331,301,320.30 24,242,618,242.36
II. Accumulated
depreciation
1. Opening Balance 2,311,008,528.82 9,948,863,333.22 116,715,194.87 483,841,486.87 44,160,940.50 1,059,255,698.93 13,963,845,183.21
2. Increase in the
159,113,593.58 550,399,553.37 11,719,891.26 51,764,806.73 3,371,123.49 50,294,679.70 826,663,648.13
Current Period
(1) Provision 137,415,189.16 527,920,288.72 9,857,032.09 50,314,948.47 2,779,364.02 49,712,493.03 777,999,315.49
(2) Other increases 21,698,404.42 22,479,264.65 1,862,859.17 1,449,858.26 591,759.47 582,186.67 48,664,332.64
3. Decrease in the
96,240,207.22 176,649,700.34 3,338,803.51 8,293,234.05 926,551.83 4,511,341.74 289,959,838.69
Current Period
(1) Disposal or
130,682,184.40 659,396.63 4,105,963.76 247,668.45 3,785,480.45 139,480,693.69
retirement
(2) Other decreases 96,240,207.22 45,967,515.94 2,679,406.88 4,187,270.29 678,883.38 725,861.29 150,479,145.00
4. Ending Balance 2,373,881,915.18 10,322,613,186.25 125,096,282.62 527,313,059.55 46,605,512.16 1,105,039,036.89 14,500,548,992.65
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III. Impairment
provision
1. Opening Balance 12,344.37 28,361,635.01 2,207,942.80 30,581,922.18
2. Increase in the
Current Period
(1) Provision
3. Decrease in the
11,202,028.15 11,202,028.15
Current Period
(1) Disposal or
11,202,028.15 11,202,028.15
retirement
4. Ending Balance 12,344.37 17,159,606.86 2,207,942.80 19,379,894.03
IV. Book value
1. Ending book
3,282,365,273.49 5,995,083,727.25 50,673,253.67 155,936,594.07 14,576,166.59 224,054,340.61 9,722,689,355.68
value
2. Beginning book
3,413,988,842.97 5,678,931,313.59 46,499,496.36 178,274,697.15 16,500,347.83 270,441,429.63 9,604,636,127.53
value
164
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(2) Temporary idle fixed assets
Unit: CNY
Original Book Accumulated Impairment
Item Book Value Remarks
Value Depreciation Provision
Machinery 43,234,813.34 24,826,861.88 16,639,992.21 1,767,959.25
equipment
Others 72,226,913.83 68,718,132.23 2,207,942.80 1,300,838.80
Total 115,461,727.17 93,544,994.11 18,847,935.01 3,068,798.05
(3) Fixed assets leased out under operating leases
Unit: CNY
Item Ending Book Value
Means of transport 9,059.84
Total 9,059.84
(4) Disposal of fixed assets
Unit: CNY
Item Ending Balance Opening Balance
Houses and buildings 37,264.20 283,806.99
Machinery equipment 5,567,925.76 7,759,672.33
Means of transport 44,554.50 113,084.68
Electronic equipment 76,503.87 77,126.05
Office equipment 50,976.33 45,702.70
Others 307,305.54 7,290.00
Total 6,084,530.20 8,286,682.75
Other description:
16 Construction in progress
Unit: CNY
Item Ending Balance Opening Balance
Project under construction 1,680,851,141.66 1,902,143,354.11
Total 1,680,851,141.66 1,902,143,354.11
165
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(1) Construction in progress
Unit: CNY
Ending Balance Opening Balance
Item Impairment Impairment
Book balance Book Value Book Balance Book Value
Provision Provision
New and reconstructed
339,485,187.80 1,945,416.12 337,539,771.68 230,889,214.48 1,945,416.12 228,943,798.36
investment project
Technical transformation
1,343,366,867.17 55,497.19 1,343,311,369.98 1,673,255,052.94 55,497.19 1,673,199,555.75
investment project
Total 1,682,852,054.97 2,000,913.31 1,680,851,141.66 1,904,144,267.42 2,000,913.31 1,902,143,354.11
(2) Changes in important construction in progress in the current period
Unit: CNY
Including:
Amount Other Proportion of Capitalized Capitalization
Cumulative
Transferred to Decreases Accumulated Interest Rate of
Increase in the Project Amount of Capital
Project name Budget Opening Balance Fixed Assets in in the Ending Balance Investment in Amount Interest in
Current Period Progress Capitalized Source
the Current Current Constructions during the Current
Interest
Period Period to Budget Current Period
Period
FAW Jiefang
commercial
vehicle 999,970,000.00 620,489,096.96 -56,572,385.55 563,916,711.41 56.39% 62.05% Others
Guanghan base
project
Axle base
construction
project and
989,859,950.93 421,427,528.84 58,505,153.94 13,957,510.62 465,975,172.16 46.48% 66.00% Others
heavy
replacement axle
technology
166
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upgrade (phase I)
Collinear project
of 50,000 sets of
667,780,000.00 102,315,208.39 10,662,676.76 112,977,885.15 16.92% 17.00% Others
new 13L and M
series engines
R&D capacity
improvement
project of FAW 693,162,000.00 49,273,323.85 80,664,888.14 129,938,211.99 18.75% 22.86% Others
Jiefang Qingdao
Base
FAW Jiefang
south new energy 413,800,000.00 41,677,157.08 342,293.20 42,019,450.28 45.95% 76.68% Others
base project
Technical
transformation
project of
898,000,000.00 7,939,826.14 22,422,379.56 2,813,008.86 27,549,196.84 3.38% 4.37% Others
integrated heavy
duty AMT
gearbox
New energy
product
introduction and 79,820,000.00 20,357,026.83 181,981.13 20,539,007.96 25.73% 26.63% Others
smart logistics
upgrade project
M engine
crankshaft
capacity
30,500,000.00 19,768,205.86 19,768,205.86 64.81% 64.81% Others
improvement
project
(W31000000111)
Project of exiting
the city and
936,068,800.00 19,204,724.39 53,094.34 19,257,818.73 94.22% 99.80% Others
entering the
industrial park
Drivetrain
assembly NVH
bench laboratory 34,940,000.00 616,250.44 15,378,077.60 15,994,328.04 45.78% 45.78% Others
AC motor
dynamometer
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Motor assembly
22,300,000.00 15,221,238.88 15,221,238.88 68.26% 68.26% Others
line
16L Engine
construction and
natural gas test
1,227,429,000.00 302,528,245.34 179,880,930.95 470,425,539.61 11,983,636.68 66.96% 86.42% Others
capacity
improvement
project (16L)
Total 6,993,629,750.93 1,620,817,833.00 311,519,090.07 487,196,059.09 1,445,140,863.98
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17 Productive biological assets
(1) Productive biological assets measured at cost
□ Applicable Not applicable
(2) Productive biological assets measured at fair value
□ Applicable Not applicable
18 Oil and gas assets
□ Applicable Not applicable
19 Right-of-use assets
Unit: CNY
Houses and Machinery
Item Land Total
Buildings Equipment
I. Original book value
1. Opening Balance 203,880,616.59 54,778,761.06 23,719,044.14 282,378,421.79
2. Increase in the
Current Period
3. Decrease in the
6,458,400.84 6,458,400.84
Current Period
4. Ending Balance 197,422,215.75 54,778,761.06 23,719,044.14 275,920,020.95
II. Accumulated
depreciation
1. Opening Balance 71,135,818.41 13,022,260.79 84,158,079.20
2. Increase in the
22,563,052.42 5,477,876.11 1,919,344.32 29,960,272.85
Current Period
(1) Provision 22,563,052.42 5,477,876.11 1,919,344.32 29,960,272.85
3. Decrease in the
5,790,290.48 5,790,290.48
Current Period
(1) Disposal 5,790,290.48 5,790,290.48
4. Ending Balance 87,908,580.35 5,477,876.11 14,941,605.11 108,328,061.57
III. Impairment
provision
1. Opening Balance
2. Increase in the
Current Period
(1) Provision
3. Decrease in the
Current Period
(1) Disposal
4. Ending Balance
IV. Book value
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1. Ending book
109,513,635.40 49,300,884.95 8,777,439.03 167,591,959.38
value
2. Beginning book
132,744,798.18 54,778,761.06 10,696,783.35 198,220,342.59
value
Other description:
20 Intangible Assets
(1) Details of Intangible Assets
Unit: CNY
Patent Non-patented
Item Land Use Right Software Total
Rights Technology
I. Original book
value
1. Opening
2,638,198,126.04 367,511,725.92 607,046,360.09 3,612,756,212.05
Balance
2. Increase in
42,710,875.82 36,090,410.17 78,801,285.99
the Current Period
(1) Purchase 35,053,806.40 35,053,806.40
(2) Internal
R&D
(3) Increase due
to business
combination
(4) Other
42,710,875.82 1,036,603.77 43,747,479.59
increases
3. Decrease in
42,710,875.82 3,606,009.01 46,316,884.83
the Current Period
(1) Disposal 2,569,405.24 2,569,405.24
(2) Other
42,710,875.82 1,036,603.77 43,747,479.59
decreases
4. Ending
2,638,198,126.04 367,511,725.92 639,530,761.25 3,645,240,613.21
Balance
II. Accumulated
amortization
1. Opening
553,533,325.53 303,361,007.48 206,764,960.99 1,063,659,294.00
Balance
2. Increase in
39,444,569.03 22,975,605.59 41,640,225.43 104,060,400.05
the Current Period
(1) Provision 28,018,476.71 22,975,605.59 40,752,092.27 91,746,174.57
(2) Other
11,426,092.32 888,133.16 12,314,225.48
increases
3. Decrease in
11,282,888.01 3,416,620.26 14,699,508.27
the Current Period
(1) Disposal
(2) Others 11,282,888.01 3,416,620.26 14,699,508.27
4. Ending
581,695,006.55 326,336,613.07 244,988,566.16 1,153,020,185.78
Balance
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III. Impairment
provision
1. Opening
Balance
2. Increase in
the Current Period
(1) Provision
3. Decrease in
the Current Period
(1) Disposal
4. Ending
Balance
IV. Book value
1. Ending book
2,056,503,119.49 41,175,112.85 394,542,195.09 2,492,220,427.43
value
2. Beginning
2,084,664,800.51 64,150,718.44 400,281,399.10 2,549,096,918.05
book value
The proportion of intangible assets formed through internal R&D to the balance of intangible assets at the end
of current period is 0.00%.
21 Development expenditures
Unit: CNY
Increase in the Current Period Decrease in the Current Period
Opening Internal Recognized Transferred to Ending
Item
Balance Development Others as Intangible Current Profits and Balance
Expenditures Assets Losses
Expenses
and 1,248,047,703.54 1,248,047,703.54
expenditures
Total 1,248,047,703.54 1,248,047,703.54
Other description
22 Long-term deferred expenses
Unit: CNY
Opening Increase in the Amortization Amount Other
Item Ending Balance
Balance Current Period in the Current Period Decreases
Maintenance, fire
protection
130,439.66 87,645.68 42,793.98
transformation and
supporting expenses
Total 130,439.66 87,645.68 42,793.98
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Other description
23 Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets not offset
Unit: CNY
Ending Balance Opening Balance
Deductible
Item Deductible Temporary Deferred Income Deferred Income
Temporary
Difference Tax Assets Tax Assets
Difference
Impairment provision
587,634,020.62 100,784,037.71 633,651,664.00 111,898,550.65
of assets
Unrealized profits of
11,827,733.38 2,956,933.35 11,827,733.38 2,956,933.35
internal transactions
Deductible losses 7,305,636,510.55 1,317,196,265.41 5,145,166,718.01 927,446,279.03
Estimated liabilities 849,704,115.08 143,268,850.04 794,067,908.68 132,797,620.71
Employee
86,496,945.92 14,710,089.44 118,991,183.21 20,016,363.56
compensation payable
Accrued expenses 2,736,473,941.65 613,455,010.40 3,175,125,774.27 742,710,859.21
Deferred income 492,142,773.14 101,034,898.37 538,046,593.82 108,889,119.49
Contract liabilities 559,876,008.52 86,290,299.42 539,407,507.24 84,634,179.21
Total 12,629,792,048.86 2,379,696,384.14 10,956,285,082.61 2,131,349,905.21
(2) Deferred income tax liabilities not offset
Unit: CNY
Ending Balance Opening Balance
Item Taxable temporary Deferred income tax Taxable temporary Deferred income tax
difference liabilities difference liabilities
Depreciation of
fixed assets with
amortization period 2,204,198,890.42 393,846,150.73 2,206,140,811.13 386,257,051.99
longer than tax
preference period
Accrued interest
249,764,180.74 37,529,517.42 293,135,708.15 44,112,815.94
income
Total 2,453,963,071.16 431,375,668.15 2,499,276,519.28 430,369,867.93
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(3) Details of unrecognized deferred tax assets
Unit: CNY
Item Ending Balance Opening Balance
Deductible temporary difference 647,468,913.68 619,818,965.27
Deductible losses 577,896,375.06 499,742,487.05
Total 1,225,365,288.74 1,119,561,452.32
(4) Deductible losses of unrecognized deferred tax assets will be due in the following years
Unit: CNY
Year Ending amount Beginning balance Remarks
2023
2024
2025
2026 1,441,940.00 1,441,940.00
2027 3,524,136.57 3,524,136.57
2028 260,797,353.60 259,853,735.45
2029 41,881,736.88 41,881,736.88
2030
2031
2032 193,040,938.15 193,040,938.15
2033 77,210,269.86
Total 577,896,375.06 499,742,487.05
Other description
24 Notes payable
Unit: CNY
Category Ending Balance Opening Balance
Bank acceptance bill 16,487,079,559.64 9,198,593,038.03
Total 16,487,079,559.64 9,198,593,038.03
The total amount of notes payable due but unpaid at the end of the current period is CNY 0.00.
25. Accounts payable
(1) Presentation of accounts payable
Unit: CNY
Item Ending Balance Opening Balance
Payment for goods 13,636,307,086.24 9,297,168,020.86
Project and equipment payment 65,905,466.41 11,953,792.66
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Expenses and others 3,930,214,002.64 724,486,854.54
Total 17,632,426,555.29 10,033,608,668.06
(2) Important accounts payable with the aging over 1 year
Unit: CNY
Reasons for not being repaid or
Item Ending Balance
carried over
At the legal adjudication stage,
Supplier 1 5,243,361.11 accounts are frozen and payments
are stopped
Both parties have not reached an
agreement on the contents of the
Supplier 2 4,244,960.23
contract, and no payment will be
made temporarily.
Total 9,488,321.34
Other description:
26. Advance receipts
(1) Presentation of advance receipts
Unit: CNY
Item Ending Balance Opening Balance
Rental fee 785,227.42 1,861,865.37
Total 785,227.42 1,861,865.37
27. Contract liabilities
Unit: CNY
Item Ending Balance Opening Balance
Payment for goods 1,087,367,759.69 1,155,321,169.46
Others 675,418,437.64 607,787,793.96
Contract liabilities included in other
-144,682,448.10 -133,584,259.07
current liabilities
Total 1,618,103,749.23 1,629,524,704.35
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28. Employee compensation payable
(1) Presentation of employee compensation payable
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance
Current Period Current Period
I. Short-term
273,674,313.00 2,141,121,428.54 1,897,103,856.28 517,691,885.26
compensation
II. Post-employment
benefits - defined 62,829,341.18 288,412,817.25 326,052,856.77 25,189,301.66
contribution plan
III. Dismissal
46,184,524.58 18,995,021.09 47,168,991.38 18,010,554.29
welfare
IV. Other benefits
53,960,000.00 160,405.24 6,990,635.88 47,129,769.36
due within one year
Total 436,648,178.76 2,448,689,672.12 2,277,316,340.31 608,021,510.57
(2) Presentation of short-term compensation
Unit: CNY
Opening Increase in the Decrease in the
Item Ending Balance
Balance Current Period Current Period
1. Wages, bonuses,
1,481,961,418.24 1,253,201,160.61 228,760,257.63
allowances and subsidies
2. Employee welfare
92,959,748.07 92,959,748.07
expenses
3. Social insurance
5,214,934.60 167,143,567.30 171,183,183.65 1,175,318.25
premiums
Including: medical
3,961,154.86 158,929,919.32 161,715,755.93 1,175,318.25
insurance premiums
Work-related
1,253,779.74 8,213,647.98 9,467,427.72
injury insurance premiums
4. Housing provident fund 884.00 236,848,227.72 236,849,111.72
5. Labor union funds and
268,458,494.40 61,019,086.59 41,721,271.61 287,756,309.38
employee education funds
6. Others 101,189,380.62 101,189,380.62
Total 273,674,313.00 2,141,121,428.54 1,897,103,856.28 517,691,885.26
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(3) Presentation of defined contribution plan
Unit: CNY
Opening Increase in the Decrease in the Ending
Item
Balance Current Period Current Period Balance
1. Basic endowment insurance 49,474,178.04 208,330,075.82 243,894,641.67 13,909,612.19
2. Unemployment insurance premiums 3,838,010.94 8,599,860.43 10,062,934.16 2,374,937.21
3. Payment of enterprise annuity 9,517,152.20 71,482,881.00 72,095,280.94 8,904,752.26
Total 62,829,341.18 288,412,817.25 326,052,856.77 25,189,301.66
Other description
29. Taxes payable
Unit: CNY
Item Ending Balance Opening Balance
VAT 238,326,743.85 142,544,438.56
Corporate income tax 16,513,037.84 73,697,911.27
Individual income tax 7,369,381.08 45,190,640.96
Urban maintenance and construction tax 6,846,612.55 8,789,299.91
Property tax 8,122,726.73 7,910,979.72
Land use tax 4,108,703.30 4,512,474.49
Education surcharges 7,361,923.20 8,830,240.70
Other taxes 17,508,337.51 9,735,859.90
Total 306,157,466.06 301,211,845.51
Other description
30. Other payables
Unit: CNY
Item Ending Balance Opening Balance
Dividends payable 171,500.02 171,500.02
Other payables 5,882,524,335.15 6,095,281,248.15
Total 5,882,695,835.17 6,095,452,748.17
(1) Dividends payable
Unit: CNY
Item Ending Balance Opening Balance
Ordinary stock dividends 171,500.02 171,500.02
Total 171,500.02 171,500.02
Other description, including the disclosure of the reasons for not paying the important dividends payable for
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more than 1 year:
(2) Other payables
1) Presentation of other payables by payment nature
Unit: CNY
Item Ending Balance Opening Balance
Expenses payable 3,040,928,449.50 3,371,722,694.19
Margin, deposit 339,963,742.57 311,219,645.69
Project funds payable 1,648,482,837.70 1,524,956,021.50
Current accounts payable and others 677,851,984.54 619,545,702.66
Repurchase obligations of restricted
175,297,320.84 267,837,184.11
shares
Total 5,882,524,335.15 6,095,281,248.15
2) Other important payables with the aging over 1 year
Unit: CNY
Reasons for not Being
Item Ending Balance
Repaid or Carried over
The Ninth Institute of Project Planning &
71,442,466.85 Project not completed
Research of China Machinery Industry (FIPPR)
Supplier 1 28,211,998.96 Project not completed
Supplier 2 13,560,000.00 Project not completed
Supplier 3 12,349,284.40 Project not completed
Qiming Information Technology Co., Ltd. 10,699,545.55 Project not completed
Total 136,263,295.76
Other description
31. Non-current liabilities due within one year
Unit: CNY
Item Ending Balance Opening Balance
Lease liabilities due within one year 30,986,742.12 32,998,374.87
Total 30,986,742.12 32,998,374.87
Other description:
32. Other current liabilities
Unit: CNY
Item Ending Balance Opening Balance
Taxes to be written off 144,682,448.10 133,584,259.07
Total 144,682,448.10 133,584,259.07
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33. Lease liabilities
Unit: CNY
Item Ending Balance Opening Balance
Lease payment 85,049,957.20 94,353,447.57
Unrecognized financing charges -5,255,143.34 -6,540,469.64
Lease liabilities due within one year -30,986,742.12 -32,998,374.87
Total 48,808,071.74 54,814,603.06
Other description:
34. Long-term employee compensation payable
(1) Long-term employee compensation payable
Unit: CNY
Item Ending Balance Opening Balance
I. Post-employment welfare - net
687,489,769.36 694,320,000.00
liabilities of defined benefit plan
II. Dismissal welfare 93,098,134.27 112,469,743.86
Long-term employee compensation
-65,140,323.65 -99,478,853.43
payable due within one year
Total 715,447,579.98 707,310,890.43
35. Estimated liabilities
Unit: CNY
Item Ending Balance Opening Balance Reason
Pending litigation 10,045,157.32 32,195,157.32
Product quality assurance 922,703,546.87 826,046,651.49
Others 17,226,995.29 17,226,995.29
Total 949,975,699.48 875,468,804.10
Other description, including important assumptions and estimation descriptions related to important estimated
liabilities:
36. Deferred income
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance Reason
Current Period Current Period
Government
3,121,985,685.93 55,826,903.12 159,416,894.82 3,018,395,694.23
subsidies
Total 3,121,985,685.93 55,826,903.12 159,416,894.82 3,018,395,694.23
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Items involving government subsidies: For details of government subsidies included in deferred income, please
refer to 63 "Government Subsidies" in VII of Section X - Financial Report.
37. Share capital
Unit: CNY
Increase/Decrease (+/-)
Share Transferred
Issue of
Opening Balance Bonus from Ending Balance
New Others Subtotal
shares Accumulation
Shares
Fund
Total
4,651,965,655.00 -14,633,325.00 -14,633,325.00 4,637,332,330.00
shares
Other description:
38. Capital reserves
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance
Current Period Current Period
Capital premium (stock
9,373,398,263.61 77,906,538.27 9,295,491,725.34
premium)
Other capital reserves 1,077,689,973.13 7,500,283.02 23,772.68 1,085,166,483.47
Total 10,451,088,236.74 7,500,283.02 77,930,310.95 10,380,658,208.81
Other description, including increase/decrease in the current period and reasons for change:
(1) The capital reserve (share premium) decreased by CNY 77,906,538.27 in the current period due to the
repurchase and cancellation of equity incentive shares of the Company.
(2) The capital reserve (other capital reserves) increased by CNY 7,500,283.02 in the current period due to the
recognition of share-based payment expenses during the vesting period of the Company's equity incentive plan.
(3) The capital reserve (other capital reserves) decreased by CNY 23,772.68 in the current period due to the
Company's recognition of changes in other owner's equity of the investee, in proportion to its equity, than net
profit or loss, other comprehensive income and profit distribution.
39 Treasury shares
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance
Current Period Current Period
Treasury shares 267,837,184.11 92,539,863.27 175,297,320.84
Total 267,837,184.11 92,539,863.27 175,297,320.84
Other explanations, including the increase/decrease and reasons for changes in the current period: The decrease
of CNY 92,539,863.27 in treasury share capital in the current period was caused by the repurchase and
cancellation of equity incentive shares recognized by the Company.
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40 Other comprehensive incomes
Unit: CNY
Amount Incurred in Current Period
Less: Current Less: Current
Profits or Retained
Amount
Losses Earnings
Incurred After-tax After-tax
Transferred Transferred
before Less: Amount Amount
Item Opening Balance from Other from Other Ending Balance
Income Tax Income Tax Attributable to Attributable
Comprehensive Comprehensive
in the Expenses Parent to Minority
Income Income
Current Company Shareholders
Recorded in Recorded in
Period
the Previous the Previous
Period Period
I. Other
comprehensive
incomes that
cannot be -4,024,777.80 -4,024,777.80
reclassified
into profits or
losses
Including:
changes
arising from
re- -4,040,000.00 -4,040,000.00
measurement
of the defined
benefit plan
Other
comprehensive
incomes that
cannot be
15,222.20 15,222.20
reclassified
into profit or
loss under the
equity method
II. Other
comprehensive
incomes that
will be -1,374,343.01 250,455.89 -1,123,887.12
reclassified
into profits or
losses
Including:
other
comprehensive
-496,016.97 254,420.76 -241,596.21
incomes that
can be
reclassified
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into profits or
losses under
the equity
method
Translation
difference in
foreign
-878,326.04 -3,964.87 -882,290.91
currency
financial
statements
Total other
comprehensive -5,399,120.81 250,455.89 -5,148,664.92
incomes
Other description, including the adjustment of the effective part of cash flow hedging profit or loss transferred
to the initially recognized amount of the hedged item:
41 Special reserves
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance
Current Period Current Period
Work safety cost 370,420,291.86 15,046,812.40 16,497,144.11 368,969,960.15
Total 370,420,291.86 15,046,812.40 16,497,144.11 368,969,960.15
Other description, including increase/decrease in the current period and reasons for change:
42 Surplus reserves
Unit: CNY
Increase in the Decrease in the
Item Opening Balance Ending Balance
Current Period Current Period
Statutory surplus reserve 2,760,723,110.73 2,760,723,110.73
Discretionary surplus reserves 297,526,491.71 297,526,491.71
Total 3,058,249,602.44 3,058,249,602.44
Description of surplus reserve, including increase/decrease and reasons for change in the current period:
43 Undistributed profits
Unit: CNY
Item Current Period Previous Period
Undistributed profits at the end of the previous period before
5,460,939,601.36 8,434,403,352.08
adjustment
Undistributed profits at the beginning of the current period after
5,460,939,601.36 8,434,403,352.08
adjustment
Add: net profit attributable to owners of parent company in the current 401,336,302.35 170,153,887.32
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period
Less: ordinary stock dividends payable 3,025,174,498.45
Undistributed profits at the end of the period 5,862,275,903.71 5,579,382,740.95
Details of adjustment to undistributed profits at the beginning of period:
1) The undistributed profit at the beginning of the period affected by the retroactive adjustment of Accounting
Standards for Business Enterprises and its relevant new regulations is CNY 0.00.
2) The undistributed profit at the beginning of the period affected by changes in accounting policies is CNY
0.00.
3) The undistributed profit at the beginning of the period affected by correction of significant accounting errors
is CNY 0.00.
4) The undistributed profit at the beginning of the period affected by the changes in consolidation scope due to
same control is CNY 0.00.
5) The undistributed profit at the beginning of the period affected by other adjustments totals CNY 0.00.
44 Operating income and operating cost
Unit: CNY
Amount Incurred in Current Period Amount Incurred in the Previous Period
Item
Income Cost Income Cost
Main business 32,139,093,286.21 29,929,907,291.11 21,805,259,709.38 20,220,312,403.72
Other business 875,568,627.92 660,616,486.91 1,066,275,552.18 894,738,065.89
Total 33,014,661,914.13 30,590,523,778.02 22,871,535,261.56 21,115,050,469.61
Information related to performance obligations: none
Information related to the transaction price allocated to the remaining performance obligations: The income
corresponding to the performance obligations that have been signed but not yet fulfilled or completed at the end
of the reporting period is CNY 675,418,437.64, of which CNY 337,709,218.82 is expected to be recognized in
2023 and CNY 337,709,218.82 is expected to be recognized in 2024.
Other description
45 Taxes and surcharges
Unit: CNY
Amount Incurred in Current
Item Amount Incurred in the Previous Period
Period
Urban maintenance and
19,546,313.81 21,670,465.02
construction tax
Education surcharges 14,049,726.20 15,501,287.61
Property tax 27,465,239.54 25,351,529.04
Land use tax 17,742,508.40 19,556,934.07
Vehicle and vessel use tax 51,933.49 54,706.28
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Stamp duty 30,606,438.19 23,538,154.45
Environmental protection tax 427,254.80 191,419.33
Others -47,844.63 635,765.71
Total 109,841,569.80 106,500,261.51
Other description:
46 Sales expenses
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Product quality assurance fee 372,020,904.40 176,597,991.74
Employee compensation 230,992,397.31 196,348,174.29
Storage fee 49,482,396.12 56,206,844.19
Promotion fee 5,652,694.61 26,616,044.88
Packing cost 36,501,913.05 32,009,966.23
Business publicity fee 5,491,042.24 13,770,613.76
Travel expense 32,468,745.00 15,775,038.28
Sales service fee 7,172,990.92 11,115,081.89
Rental fee 23,305,950.67 26,468,705.36
Insurance premium 2,116,210.71 3,179,938.52
Others 9,617,573.30 8,402,329.68
Total 774,822,818.33 566,490,728.82
Other description:
47 Administrative expenses
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Employee compensation 554,575,877.44 598,558,389.99
Repair cost of fixed assets 86,296,341.73 69,924,624.89
Depreciation cost 62,859,036.45 59,078,687.98
Amortization of intangible assets 45,228,775.75 44,522,259.21
Labor outsourcing fee 20,600,631.57 24,977,327.54
Information system service fee 18,919,334.81 20,402,954.88
Sewage charge 9,479,418.73 8,702,172.92
Kinetic energy and workshop
15,614,154.67 12,918,192.98
heating cost
Publicity fee 2,792,288.47 1,367,051.26
Test and inspection fee 5,943,937.13 3,884,917.30
Others 48,851,266.17 42,683,537.57
Total 871,161,062.92 887,020,116.52
Other description
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48 R&D expenses
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Employee compensation 781,461,814.17 682,745,813.55
Test fee 161,697,116.15 106,067,297.14
Trial production cost 72,342,454.50 61,977,054.15
Depreciation cost 121,938,716.42 125,686,161.11
Joint R&D expenses 53,939,832.01 3,323,914.67
Design fee 3,092,727.26 26,118,317.60
Others 53,575,043.03 10,397,664.42
Total 1,248,047,703.54 1,016,316,222.64
Other description
49 Financial expenses
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Interest income -332,873,373.32 -502,087,676.33
Bill discount interest
Net actuarial interest 463,219.03 166,532.74
Handling charge of financial
62,645.64 81,595.17
institutions
Interest expense 2,201,462.83 2,361,612.41
Exchange gain or loss -134,786.41 -186,398.61
Others -85,382,599.83 -71,489,636.46
Total -415,663,432.06 -571,153,971.08
Other description
50 Other income
Unit: CNY
Amount Incurred in the Previous
Sources of other income Amount Incurred in Current Period
Period
Subsidies 193,604,585.44 227,954,740.41
Others 2,051,784.67 2,092,309.91
Total 195,656,370.11 230,047,050.32
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51. Investment income
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Income from long-term equity
investments accounted for using the 234,054,148.54 281,180,159.71
equity method
Others -100,436,268.67 -77,271,243.30
Total 133,617,879.87 203,908,916.41
Other description:
52 Credit impairment loss
Unit: CNY
Amount Incurred in Current Amount Incurred in
Item
Period the Previous Period
Bad debt losses of other receivables -288,813.51 2,682,455.55
Bad debt losses of long-term receivables -2,927,793.76 -4,660,539.00
Bad debt losses of notes receivable -69,181.55 33,965.46
Bad debt losses of accounts receivable -32,194,937.26 -19,882,625.36
Total -35,480,726.08 -21,826,743.35
Other description
53 Asset impairment loss
Unit: CNY
Amount Incurred in Current Amount Incurred in
Item
Period the Previous Period
I. Inventory falling price loss and contract performance
-35,182,158.70 -85,486,353.05
cost impairment loss
II. Impairment loss of contract assets -142,013.25 141,606.09
Total -35,324,171.95 -85,344,746.96
Other description:
54 Income from assets disposal
Unit: CNY
Sources of Income from Assets Amount Incurred in the Previous
Amount Incurred in Current Period
Disposal Period
Gains from disposal of fixed assets 98,132,494.11 42,431.19
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55. Non-operating income
Unit: CNY
Amount Included in
Amount Incurred in Amount Incurred in the
Item Current Non-recurring
Current Period Previous Period
Profits and Losses
Unpayable amount
581,828.00 581,828.00
recognized
Income from compensation,
liquidated damages and 7,871,739.74 5,797,555.07 7,871,739.74
penalties
Gains from damage and
retirement of non-current 695,112.91 695,112.91
assets
Others 393,806.14 98,260,551.19 393,806.14
Total 9,542,486.79 104,058,106.26 9,542,486.79
56. Non-operating expenses
Unit: CNY
Amount Included in
Amount Incurred in Amount Incurred in the Current Non-
Item
Current Period Previous Period recurring Profits and
Losses
Donation 2,000,000.00 10,000,000.00 2,000,000.00
Expenditure on compensation,
435,083.63 1,303,569.25 435,083.63
liquidated damages and fines
Losses from damage and
retirement of non-current 1,297,109.63 897,265.34 1,297,109.63
assets
Others 69,570.55 13,400.00 69,570.55
Total 3,801,763.81 12,214,234.59 3,801,763.81
Other description:
57 Income tax expenses
(1) Statement of income tax expenses
Unit: CNY
Item Amount Incurred in Current Period Amount Incurred in the Previous Period
Current income tax expenses 42,401,718.66 323,637,275.45
Deferred income tax expense -245,467,038.39 -323,808,949.95
Total -203,065,319.73 -171,674.50
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(2) Adjustment process of accounting profits and income tax expenses
Unit: CNY
Item Amount Incurred in Current Period
Total profits 198,270,982.62
Income tax expense calculated at statutory/applicable tax rate 49,567,745.66
Effect of different tax rates applied to subsidiaries 7,621,554.68
Effect of adjustment to income tax of previous periods -22,095,779.87
Effect of non-deductible costs, expenses and losses 422,258.49
Effects of deductible temporary differences or deductible losses
-9,472,260.95
of deferred income tax assets unrecognized in the current period
Profit or loss of joint ventures and associated enterprises
-58,364,426.81
calculated by equity method
Tax effect of R&D expenses plus deduction (to be listed with "-
-170,744,410.92
")
Income tax expenses -203,065,319.73
Other description
58 Other comprehensive incomes
For details, please refer to 40 "Other comprehensive income" in VII "Notes to Items in Consolidated Financial
Statements" of Section X - Financial Report.
59 Items of cash flow statement
(1) Other cash received related to operating activities
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Government subsidies received 89,195,336.75 541,049,227.17
Collection and payment 9,286,574.17 1,811,788.44
Rental fee received 2,874,590.58 8,480,131.06
Fines and indemnities received 4,419,145.87 2,410,227.73
Refund of handling fees 803,868.95 942,826.72
Recovery of reserve funds 538,760.42 286,468.08
Other current accounts 534,529,346.19 290,185,578.70
Total 641,647,622.93 845,166,247.90
Description of other cash received related to operating activities:
(2) Other cash payments related to operating activities
Unit: CNY
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Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Out-of-pocket expenses 494,020,512.30 212,022,745.78
Current account 455,747,557.22 624,431,327.44
Donations 2,000,000.00
Total 951,768,069.52 836,454,073.22
Description of other cash payments related to operating activities:
(3) Other cash received related to financing activities
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Interest received 368,529,711.02 441,265,670.20
Total 368,529,711.02 441,265,670.20
Description of other cash received related to investing activities:
(4) Other cash payments related to financing activities
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Donations 10,000,000.00
Principal and interest on lease
19,709,605.31 5,922,921.74
liabilities
Total 19,709,605.31 15,922,921.74
Description of other cash payments related to financing activities:
60 Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
Unit: CNY
Amount in the Amount of the
Supplementary information
Current Period Previous Period
1. Reconciliation of net profit to cash flows from operating
activities:
Net Profit 401,336,302.35 170,153,887.32
Add: impairment provision of assets 70,804,898.03 107,171,490.31
Depreciation of fixed assets, depletion of oil and gas
806,546,681.57 802,424,319.33
assets and productive biological assets
Depreciation of right-of-use asset 5,115,821.82 36,125,831.02
Amortization of intangible assets 52,772,614.33 52,038,602.60
Amortization of long-term deferred expenses
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Losses from disposal of fixed assets, intangible assets and
-98,132,494.11 -42,431.19
other long-term assets (incomes to be listed with "-")
Loss from retirement of fixed assets (incomes to be listed
1,297,109.63 897,265.34
with “-”)
Loss from changes in fair value (incomes to be listed with
“-”)
Financial expenses (incomes to be listed with “-”) -330,682,164.07 -499,726,063.92
Investment losses (incomes to be listed with “-”) -133,617,879.87 -203,908,916.41
Decrease of deferred income tax assets (increase to be
-248,346,478.93 -258,660,870.66
listed with "-")
Increases of deferred income tax liabilities (decrease to be
1,005,800.22 -65,148,079.29
listed with “-”)
Decrease in inventories (increase to be listed with "-") -1,448,702,170.39 232,662,937.16
Decrease in operating receivables (increase to be listed
-9,607,002,028.80 -1,476,787,647.94
with "-")
Increase in operating items payable (decrease to be listed
17,346,803,689.10 2,314,756,621.70
with “-”)
Others -105,040,323.41 231,180,781.26
Net cash flows from operating activities 6,714,159,377.47 1,443,137,726.63
2. Significant investment and financing activities not involving
cash deposit and withdrawal:
Conversion of debt into capital
Convertible corporate bonds within one year
Fixed assets acquired under financial lease
3. Net changes in cash and cash equivalents:
Ending Balance of cash 26,430,438,475.01 28,270,082,742.95
Less: opening balance of cash 20,697,669,726.18 30,542,676,891.89
Add: ending balance of cash equivalents
Less: opening balance of cash equivalents
Net increase in cash and cash equivalents 5,732,768,748.83 -2,272,594,148.94
(2) Composition of cash and cash equivalents
Unit: CNY
Item Ending Balance Opening Balance
I. Cash 26,430,438,475.01 20,697,669,726.18
Bank deposits readily
26,430,438,475.01 28,270,082,742.95
available for payment
II. Ending Balance of cash and cash
26,430,438,475.01 20,697,669,726.18
equivalents
Other description:
61 Assets with restricted ownership or use right
Unit: CNY
Item Ending Book Value Reason for Restriction
189
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Housing maintenance fund, security deposit for
Monetary capital 51,204,457.41
three types of personnel and frozen funds
Total 51,204,457.41
Other description:
62 Foreign currency monetary items
(1) Foreign currency monetary items
Unit: CNY
Foreign Currency Balance Ending Balance
Item EXCHANGE RATE
at the End of the Period Converted into CNY
Monetary capital
Including: USD
EUR 1,838,512.73 7.4229 13,647,096.14
HKD
Accounts receivable
Including: USD
EUR
HKD
Long-term loans
Including: USD
EUR
HKD
Other description:
63 Government subsidies
(1) Basic information on government subsidies
Unit: CNY
Amount Included in
Category Amount Presented Items
Current Profits and Losses
Government subsidies 3,018,395,694.23 Deferred income 193,604,585.44
VIII. Changes in Consolidation Scope
1. Changes in consolidation scope for other reasons
Description of the changes in consolidation scope caused by other reasons (such as new subsidiaries, liquidation
subsidiaries, etc.) and relevant information: The Company established a new subsidiary, FAW Jiefang Uni-D
(Tianjin) Technology Co., Ltd., on April 14, 2023.
190
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IX. Equity in Other Entities
1. Equity in subsidiaries
(1) Composition of the enterprise group
Principal Share proportion
Registration Nature of Way of
Name of subsidiary business
place business Direct Indirect acquisition
place
Business
FAW Jiefang Automotive Vehicle merger under
Changchun Changchun 100.00%
Co., Ltd. manufacturing common
control
Business
Vehicle
FAW Jiefang (Qingdao) merger under
Qingdao Qingdao manufacturing 100.00%
Automotive Co., Ltd. common
and sales
control
Business
Automotive
FAW Jiefang Dalian Diesel merger under
Dalian Dalian engine 100.00%
Engine Co., Ltd. common
manufacturing
control
Manufacturing
Business
of automotive
merger under
Wuxi Dahao Power Co., Ltd. Wuxi Wuxi components 100.00%
common
and
control
accessories
Business
Technology
FAW Jiefang Austria R&D merger under
Austria Austria research and 100.00%
Co., Ltd. common
development
control
FAW Jiefang New Energy Establishment
Changchun Changchun Vehicle sales 100.00%
Automotive Sales Co., Ltd. by investment
FAW Jiefang Uni-D (Tianjin) Science and
Establishment
Technology Industry Co., Tianjin Tianjin technology 100.00%
by investment
Ltd. promotion
Description of the fact that the shareholding proportion in subsidiaries is different from the proportion of voting
rights: none
Basis for holding half or less of the voting rights but still controlling the investee, and for holding more than
half of the voting rights but not controlling the investee: none
Basis for control of important structured entities included in the consolidation scope: none
Basis for determining whether the Company is an agent or a principal: none
Other description: none
191
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2. Equities in joint ventures or associated enterprise
(1) Important joint ventures or associated enterprises
Share Proportion Accounting
Treatment
Method for
Principal
Name of Joint Ventures or Associated Registration Nature of Investment
Business
Enterprises Place Business Direct Indirect in Joint
Place
Ventures or
Associated
Enterprises
Financial Equity
First Automobile Finance Co., Ltd. Changchun Changchun 21.84%
services method
Sanguard Automobile Insurance Co., Financial Equity
Changchun Changchun 17.50%
Ltd. insurance method
FAW Changchun Ansteel Steel Industrial Equity
Changchun Changchun 40.00%
Processing and Distribution Co., Ltd. manufacturing method
FAW Changchun Baoyou Jiefang
Industrial Equity
Steel Processing and Distribution Co., Changchun Changchun 21.81%
manufacturing method
Ltd.
Manufacturing
Changchun Wabco Automotive of automotive Equity
Changchun Changchun 40.00%
Control System Co., Ltd. components and method
accessories
Application
software Equity
Suzhou Zhito Technology Co., Ltd. Suzhou Suzhou 26.92%
research and test method
development
Software and
FAW Jiefang Fujie (Tianjin) information Equity
Tianjin Tianjin 10.00%
Technology Industry Co., Ltd. technology method
services
Software and
information Equity
SmartLink Nanjing Nanjing 35.00%
technology method
services
Manufacturing
Foshan Diyiyuan New Energy Equity
Foshan Foshan and technical 45.00%
Technology Co., Ltd. method
services
Research and
Jiefang Times New Energy Shijiazhua Equity
Shijiazhuang experimental 50.00%
Technology Co., Ltd. ng method
development
Manufacturing
Changchun Automotive Test Center Equity
Changchun Changchun and technical 14.63%
Co., Ltd. method
services
192
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Explanation of the fact that the shareholding proportion in joint ventures or associated enterprises is different
from the proportion of voting rights: there is no difference between the shareholding proportion and the
proportion of voting rights.
Basis for holding less than 20% of voting rights but with significant influence, or holding 20% or more of
voting rights but without significant influence: The Company holds 17.50% of the shares of Sanguard
Automobile Insurance Co., Ltd., but it sends one director to the later according to the Articles of Association of
the later, so the Company can exert significant influence on Sanguard Automobile Insurance Co., Ltd. The
Company holds 10.00% of the shares of FAW Jiefang Fujie (Tianjin) Technology Industry Co., Ltd., but it sends
three directors to the later according to the Articles of Association of the later, so the Company can exert
significant influence on FAW Jiefang Fujie (Tianjin) Technology Industry Co., Ltd.
193
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(2) Main financial information on important associated enterprises
Unit: CNY
Ending Balance/Amount Incurred in Current Period
FAW
FAW Changchun
Changchun FAW Jiefang Foshan
Sanguard Changchun Wabco Jiefang Times
Baoyou Suzhou Zhito Fujie (Tianjin) Diyiyuan Changchun
First Automobile Automobile Ansteel Steel Automotive New Energy
Jiefang Steel Technology Technology SmartLink New Energy Automotive Test
Finance Co., Ltd. Insurance Co., Processing and Control Technology
Processing and Co., Ltd. Industry Co., Technology Center Co., Ltd.
Ltd. Distribution System Co., Co., Ltd.
Distribution Ltd. Co., Ltd.
Co., Ltd. Ltd.
Co., Ltd.
2,088,248,362.0 313,632,486.5 39,338,385.8 327,408,201.0 456,237,342.4 1,818,932,231.2 148,176,612.8 79,560,864.9
Current assets 41,270,226,585.06 79,948,115.57 2,069,411,355.80
1 4 7 2 5 7 2 6
Non-current 102,715,665,529.7 25,757,823.4 1,544,012,715.4
805,822,534.53 64,262,885.54 55,680,302.93 95,437,195.16 622,636,646.84 10,572,521.38 9,527,157.95
assets 9 7 9
2,894,070,896.5 377,895,372.0 65,096,209.3 383,088,503.9 551,674,537.6 158,749,134.2 89,088,022.9 3,613,424,071.2
Total assets 143,985,892,114.85 2,441,568,878.11 79,948,115.57
4 8 4 5 1 0 1 9
Current 121,982,755,342.9 156,042,957.4 22,797,376.0 196,925,540.7 199,352,646.4 1,835,150,832.9 184,961,560.1
449,997,819.23 621,282.73 -548,977.09 60,724,993.38
liabilities 5 8 1 8 6 1 5
Non-current 1,300,714,900.3 723,687,055.9
230,003,042.31 1,960,673.02 227,901,184.50 98,538,831.04
liabilities 4 0
122,212,758,385.2 1,750,712,719.5 156,042,957.4 22,797,376.0 198,886,213.8 923,039,702.3 2,063,052,017.4 184,961,560.1
Total liabilities 621,282.73 -548,977.09 159,263,824.42
6 7 8 1 0 6 1 5
-
1,143,358,176.9 221,852,414.6 42,298,833.3 184,202,290.1 79,326,832.8 89,637,000.0 3,454,160,246.8
Net Assets 21,773,133,729.59 371,365,164.7 378,516,860.70 -26,212,425.95
7 0 3 5 4 0 7
5
Minority
1,151,694,488.43 -85,907.77 448,675,662.70
equity
Equity
attributable to -
1,143,358,176.9 221,852,414.6 42,298,833.3 184,202,290.1 79,326,832.8 89,637,000.0 3,005,484,584.1
shareholders 20,621,439,241.16 371,365,164.7 378,516,860.70 -26,126,518.18
7 0 3 5 4 0 7
of the parent 5
company
Shares of net
16,919,533.3 35,697,074.7 44,818,500.0
assets 4,503,577,980.19 200,087,680.97 88,740,965.84 40,167,151.39 -99,971,502.35 37,851,686.07 -9,144,281.36 439,702,394.66
3 8 0
calculated as
194
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per the
shareholding
proportion
Adjustments -4,624,941.15 99,971,502.35 -877,875.47 9,144,281.36 237,406,313.68
--Goodwill
--Unrealized
profits from
internal
transactions
--Others
Book value of
equity
16,919,533.3 35,697,074.7 44,818,500.0
investment in 4,498,953,039.04 200,087,680.97 88,740,965.84 40,167,151.39 36,973,810.60 677,108,708.34
3 8 0
associated
enterprises
Fair value of
equity
investment in
associated
enterprises
with public
offer
Operating 290,397,008.9 29,994,307.7 688,788,120.1 1,389,765,322.9 159,572,163.4
3,209,535,678.73 436,757,499.61 35,847,499.57 264,424.78 240,465,225.12
income 0 4 7 6 2
Net Profit 1,165,863,071.10 22,325,313.14 4,167,069.20 -916,143.61 14,884,160.46 -94,145,183.33 18,284,853.78 -36,269,129.74 -233,646.64 -299,048.52 70,700,030.55
Net profit
from
discontinued
operations
Other
comprehensiv 1,185,724.65 15,630,049.55
e incomes
Total
comprehensiv 1,167,048,795.75 37,955,362.69 4,167,069.20 -916,143.61 14,884,160.46 -94,145,183.33 18,284,853.78 -36,269,129.74 -233,646.64 -299,048.52 70,700,030.55
e income
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Dividends
received from
associated
4,835,877.87 6,892,912.77
enterprises in
the current
year
Opening Balance/Amount Incurred in Previous Period
FAW Changchun
FAW Changchun
Sanguard Changchun Wabco FAW Jiefang Fujie
Baoyou Jiefang Suzhou Zhito
First Automobile Automobile Ansteel Steel Automotive (Tianjin)
Steel Processing Technology Co., SmartLink
Finance Co., Ltd. Insurance Co., Processing and Control Technology
and Distribution Ltd.
Ltd. Distribution Co., System Co., Industry Co., Ltd.
Co., Ltd.
Ltd. Ltd.
Current assets 34,615,907,095.53 2,172,822,754.87 231,520,871.50 19,053,367.45 427,768,781.91 638,977,641.34 931,332,176.60 157,591,221.86
Non-current assets 107,957,446,335.83 732,633,048.50 66,900,185.87 27,097,843.55 62,831,909.92 64,737,895.14 293,708,044.88 7,744,508.63
Total assets 142,573,353,431.36 2,905,455,803.37 298,421,057.37 46,151,211.00 490,600,691.83 703,715,536.48 1,225,040,221.48 165,335,730.49
Current liabilities 120,256,125,824.02 510,326,378.57 80,755,484.41 2,930,795.76 286,304,062.71 346,619,144.05 672,380,337.39 164,518,379.90
Non-current liabilities 1,561,324,948.51 1,246,437,069.12 3,175,522.27 633,398,618.35 181,734,209.97
Total liabilities 121,817,450,772.53 1,756,763,447.69 80,755,484.41 2,930,795.76 289,479,584.98 980,017,762.40 854,114,547.36 164,518,379.90
Net Assets 20,755,902,658.83 1,148,692,355.68 217,665,572.96 43,220,415.24 201,121,106.85 -276,302,225.92 370,925,674.12 817,350.59
Minority equity 1,182,641,203.70
Equity attributable to
shareholders of the 19,573,261,455.13 1,148,692,355.68 217,665,572.96 43,220,415.24 201,121,106.85 -276,302,225.92 370,925,674.12 817,350.59
parent company
Shares of net assets
calculated as per the 4,274,663,288.97 201,021,162.24 87,066,229.18 17,288,166.13 43,856,468.58 -74,380,559.22 37,092,567.41 286,072.71
shareholding proportion
Adjustments -4,625,319.38 74,380,559.22
--Goodwill
--Unrealized profits
from internal
transactions
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--Others
Book value of equity
investment in 4,270,037,969.59 201,021,162.24 87,066,229.18 17,288,166.13 43,856,468.58 37,092,567.41 286,072.71
associated enterprises
Fair value of equity
investment in
associated enterprises
with public offer
Operating income 3,422,338,661.73 296,473,754.70 193,852,315.00 1,615,734.44 713,063,817.33 9,159,426.31 518,166,168.85 77,641,765.61
Net Profit 1,405,479,645.81 66,252,998.15 4,513,671.66 -3,913,632.35 15,266,188.29 -101,848,190.93 5,424,761.72 -40,090,487.17
Net profit from
discontinued operations
Other comprehensive
-39,469.03 -217,810.65
incomes
Total comprehensive
1,405,440,176.78 66,035,187.50 4,513,671.66 -3,913,632.35 15,266,188.29 -101,848,190.93 5,424,761.72 -40,090,487.17
income
Dividends received
from associated
6,300,012.21
enterprises in the
current year
Other description
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(3) Excess losses incurred by joint ventures or associated enterprises
Unit: CNY
Unrecognized Losses in Accumulated
Unrecognized Losses
Name of Joint Ventures or the Current Period (or Net Unrecognized Losses
Accumulated in Prior
Associated Enterprises Profit Shared in the at the End of the
Periods
Current Period) Current Period
Suzhou Zhito Technology Co., Ltd. 74,380,559.22 25,590,943.13 99,971,502.35
SmartLink 9,144,281.36 9,144,281.36
Other description
X. Risk Related to Financial Instruments
The main financial instruments of the Company include monetary capital, notes receivable, accounts receivable, receivables
financing, other receivables, non-current assets due within one year, other current assets, long-term receivables, notes payable,
accounts payable, other payables, non-current liabilities due within one year, and lease liabilities. Details of each financial
instrument have been disclosed in relevant notes. The risks related to these financial instruments and the risk
management policies adopted by the Company to reduce these risks are described below. The management of
the Company manages and monitors these risk exposures to ensure that the above risks are controlled within a
limited range.
1. Risk management objectives and policies
The Company carries out risk management to achieve an appropriate balance between risks and benefits,
minimize the negative impact of risks on the Company's business performance, and maximize the interests of
shareholders and other equity investors. The Company, based on the risk management objectives, adopts the
basic risk management strategy of determining and analyzing various risks faced by the Company, establishing
an appropriate baseline for risk tolerance and carrying out risk management, and supervising various risks in a
timely and reliable manner to control the risks within a limited range.
Main risks caused by financial instruments of the Company include credit risk, liquidity risk and market risk
(including exchange rate risk and interest rate risk).
(1) Credit risk
Credit risk refers to the risk of financial loss to the Company caused by the counterparty's failure to perform its
contractual obligations.
The Company manages credit risks by portfolio classification. Credit risk mainly arises from bank deposits,
notes receivable, accounts receivable, other receivables, long-term receivables, etc.
The Company's deposits are mainly deposited in state-owned banks and other large and medium-sized listed
banks, and the Company does not expect significant credit risks in its bank deposits.
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The Company makes relevant policies to control the credit risk exposure for notes receivable, accounts
receivable, other receivables and long-term receivables. The Company evaluates the credit qualification of
customers and sets the credit period based on their financial conditions, credit records and other factors such as
current market situations. The Company monitors the credit records of customers regularly, and take measures
such as written reminders, shortening of credit period or cancellation of credit period for customers with poor
credit records, so as to ensure that the overall credit risk is within a controllable range.
The debtors of the Company's accounts receivable are customers distributed in different industries and regions.
The Company carries out continuous credit assessment on the financial condition of accounts receivable and
purchases credit guarantee insurance when appropriate.
The maximum credit risk exposure borne by the Company is the book value of each financial asset in the
balance sheet. The Company does not provide any other guarantee that may expose the Company to credit risk.
The accounts receivable of the top five customers account for 60.03% of the total accounts receivable of the
Company. Other receivables of the top five companies with debts account for 69.95% of the total other
receivables of the Company.
(2) Liquidity risk
Liquidity risk refers to the risk of capital shortage when the Company performs its obligations of settlement by
delivering cash or other financial assets.
The Company maintains and monitors cash and cash equivalents deemed adequate by the management during
liquidity risk management to meet the Company's operating needs and reduce the impact of fluctuations in cash
flows. The management of the Company monitors the use of bank loans and ensures compliance with the loan
agreements. Meanwhile, the Company obtains commitments from major financial institutions to provide
sufficient reserve funds to meet short-term and long-term funding needs.
The sources of the Company's working capital include funds generated from operating activities, bank loans and
other loans. As of June 30, 2023, the Company's unused bank loan limit is CNY 8 billion.
(3) Market risk
Market risk of financial instruments refers to the risk of fluctuation in fair value or future cash flow of financial
instruments due to the changes in market price, including interest rate risk, exchange rate risk and other price
risks.
Interest rate risk
The risk of changes in cash flow of financial instruments caused by changes in interest rates of the Company is
mainly related to bank loans with floating interest rates. It is the policy of the Company to maintain floating
interest rates on these loans.
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Sensitivity analysis on interest rate risk:
The sensitivity analysis on interest rate risk is based on the assumption that changes in market interest rates
affect interest income or expenses on variable rate financial instruments.
The Company had no interest-bearing debts such as bank loans as of June 30, 2023.
Exchange rate risk
Exchange rate risk refers to the risk of fluctuation in fair value or future cash flow of financial instruments due
to change in foreign exchange rate. Exchange rate risk may come from financial instruments denominated in a
foreign currency other than the recording currency.
The foreign exchange risk borne by the Company is mainly related to euros. Main business activities of the
Company are settled in CNY, except that the subsidiary established in Austria holds assets settled in EUR. The
balance of Company's assets and liabilities were all in CNY as of June 30, 2023, except a small amount of
monetary capitals including the balance in EUR. Therefore, the Company does not believe that the exchange
rate risk faced is significant.
2. Capital management
The Company prepares capital management policy to ensure continuous operation of the Company, thus
providing returns to shareholders, benefiting other stakeholders, and maintaining the best capital structure to
reduce capital costs.
In order to maintain or adjust the capital structure, the Company may adjust the financing method, adjust the
amount of dividends paid to shareholders, return capital to shareholders, issue new shares and other equity
instruments, or sell assets to reduce debt.
The Company monitors the capital structure based on the asset-liability ratio (i.e. total liabilities divided by total
assets). As of June 30, 2023, the Company's asset-liability ratio is 66.49%.
XI. Related Parties and Related Transactions
1. Parent company of the Company
Shareholding Proportion of
Proportion of Voting Rights of
Name of Parent Registration
Nature of Business Registered Capital the Parent the Parent
Company Place
Company in the Company in the
Company Company
Production and
CNY
FAW Changchun sales of automobiles 66.00% 66.00%
78,000,000,000.00
and parts
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Description of the parent company of the Company: The ultimate controlling party of the Company is China
FAW Group Co., Ltd..
Other description: The registered capital of the parent company has not changed during the reporting period.
2. Subsidiaries of the Company
For details of subsidiaries of the Company, please refer to 1 in IX "Equity in Other Entities" of Section X -
Financial Report.
3. Information on joint ventures and associated enterprises of the Company
For details of important joint ventures or associated enterprises of the Company, please refer to 2 in IX "Equity
in Other Entities" of Section X - Financial Report.
Other joint ventures or associated enterprises that have related party transactions with the Company in the
current period or in the previous period, resulting in balance, are as follows:
Name of Joint Ventures or Associated Enterprises Relationship with the Company
Associated enterprise of the Company, the same
First Automobile Finance Co., Ltd.
ultimate controlling party
Associated enterprise of the Company, the same
Sanguard Automobile Insurance Co., Ltd.
ultimate controlling party
Associated enterprise of the Company, the same
Changchun Automotive Test Center Co., Ltd.
ultimate controlling party
FAW Changchun Ansteel Steel Processing and
Associated enterprise of the Company
Distribution Co., Ltd.
Changchun Wabco Automotive Control System Co.,
Associated enterprise of the Company
Ltd.
Suzhou Zhito Technology Co., Ltd. Associated enterprise of the Company
FAW Changchun Baoyou Jiefang Steel Processing and
Associated enterprise of the Company
Distribution Co., Ltd.
FAW Jiefang Fujie (Tianjin) Technology Industry Co.,
Associated enterprise of the Company
Ltd.
SmartLink Associated enterprise of the Company
Foshan Diyiyuan New Energy Technology Co., Ltd. Associated enterprise of the Company
Jiefang Times New Energy Technology Co., Ltd. Associated enterprise of the Company
Other description
4. Information on other related parties
Relationship between Other Related Parties and the
Names Of Other Related Parties
Company
China FAW Group Import & Export Co., Ltd. The same ultimate controlling party
Changchun FAW Automobile Culture Communication
The same ultimate controlling party
Co., Ltd.
FAW Changchun Automobile Trading Service Co., Ltd. The same ultimate controlling party
201
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FAW Asset Management Co., Ltd. The same ultimate controlling party
FAW Foundry Co., Ltd. The same ultimate controlling party
FAW Zhixing Technology (Nanjing) Co., Ltd. The same ultimate controlling party
FAW New Energy Vehicle Sales (Shenzhen) Co., Ltd. The same ultimate controlling party
FAW Logistics Co., Ltd. The same ultimate controlling party
FAW Logistics (Changchun Lushun) Storage and
The same ultimate controlling party
Transportation Co., Ltd.
FAW Logistics (Qingdao) Co., Ltd. The same ultimate controlling party
FAW Mold Manufacturing Co., Ltd. The same ultimate controlling party
FAW Harbin Light Automobile Co., Ltd. The same ultimate controlling party
Changchun Faw Service Trade Co., Ltd. The same ultimate controlling party
FAW Forging (Jilin) Co., Ltd. The same ultimate controlling party
FAW-Volkswagen Automotive Co., Ltd. The same ultimate controlling party
FAW Bestune Car Co., Ltd. The same ultimate controlling party
FAW (Dalian) International Logistics Co., Ltd. The same ultimate controlling party
Wuxi Sawane Spring Co., Ltd. The same ultimate controlling party
Qiming Information Technology Co., Ltd. The same ultimate controlling party
Jilin Qiming Anxin Information Security Technology
The same ultimate controlling party
Co., Ltd.
Hainan Tropical Automobile Test Co., Ltd. The same ultimate controlling party
Dalian Qiming Haitong Information Technology Co.,
The same ultimate controlling party
Ltd.
FAW Changchun Comprehensive Utilization Co., Ltd. Other related parties
FAW Changchun Yanfeng Visteon Electronics Co., Ltd. Other related parties
FAW Changchun Communication Technology Co., Ltd. Other related parties
FAW Changchun Tianqi Process Equipment
Other related parties
Engineering Co., Ltd.
FAW Changchun Industrial Sodis Management Service
Other related parties
Co., Ltd.
FAW Changchun Industrial Shuixing Rubber and
Other related parties
Plastic Products Co., Ltd.
Changchun FAW Pratt Technology Co., Ltd. Other related parties
Changchun FAW United Casting Company Other related parties
Changchun FAWAY Automobile Components Co., Ltd. Other related parties
Changchun FAWSN Group Co., Ltd. Other related parties
Changchun Yidong Clutch Co., Ltd. Other related parties
Changchun Automotive Economic and Technological
Development Zone Environmental Sanitation and Other related parties
Cleaning Co., Ltd.
FAW Jingye Engine Co., Ltd. Other related parties
FAW Jilin Automobile Co., Ltd. Other related parties
FAW Hongta Yunnan Automobile Manufacturing Co.,
Other related parties
Ltd.
Cinda FAW Commercial Factoring Co., Ltd. Other related parties
Wuxi CRRC New Energy Automobile Co., Ltd. Other related parties
202
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Shandong Pengxiang Automobile Co., Ltd. Other related parties
China Unicom Intelligent Network Technology Co.,
Other related parties
Ltd.
United Fuel Cell System R&D (Beijing) Co., Ltd. Other related parties
The Ninth Institute of Project Planning & Research of
Other related parties
China Machinery Industry (FIPPR)
Hongqi Intelligent Mobility Technology (Beijing) Co.,
Other related parties
Ltd.
Harbin FAW Transmission Co., Ltd. Other related parties
Grammer Vehicle Parts (Qingdao) Co., Ltd. Other related parties
Grammer Vehicle Parts (Harbin) Co., Ltd. Other related parties
Fawer Auto Parts Co., Ltd. Other related parties
Volkswagen FAW Engine (Dalian) Co., Ltd. Other related parties
Other description
5. Related transactions
(1) Related transactions of purchasing or selling goods and providing or receiving labor services
Statement of goods purchase/reception of labor services
Unit: CNY
Is the
Content of Approved Amount Incurred
Amount Incurred Transaction
Related Parties Related Transaction in the Previous
in Current Period Amount
Transaction Amount Period
Exceeded
Goods
Fawer Auto Parts purchase and
751,551,871.30 1,684,360,000.00 No 581,666,983.45
Co., Ltd. reception of
labor services
Shandong Goods
Pengxiang purchase and
321,749,405.78 481,090,000.00 No 136,864,850.80
Automobile Co., reception of
Ltd. labor services
Goods
Changchun
purchase and
FAWSN Group 280,903,728.09 678,380,000.00 No 166,091,546.54
reception of
Co., Ltd.
labor services
Goods
FAW Foundry purchase and
413,071,742.20 847,650,000.00 No 264,317,382.66
Co., Ltd. reception of
labor services
Goods
FAW Logistics purchase and
195,120,017.33 400,000,000.00 No 155,444,625.15
Co., Ltd. reception of
labor services
203
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Changchun
Goods
FAWAY
purchase and
Automobile 181,104,399.46 850,690,000.00 No 125,298,339.31
reception of
Components Co.,
labor services
Ltd.
FAW Changchun
Goods
Ansteel Steel
purchase and
Processing and 156,577,508.70 229,220,000.00 No 115,077,342.40
reception of
Distribution Co.,
labor services
Ltd.
Goods
FAW Forging purchase and
191,850,549.63 509,050,000.00 No 195,192,720.59
(Jilin) Co., Ltd. reception of
labor services
Goods
FAW Logistics
purchase and
(Qingdao) Co., 119,111,915.14 426,000,000.00 No 132,447,632.30
reception of
Ltd.
labor services
Goods
Changchun
purchase and
Yidong Clutch 103,546,734.02 193,030,000.00 No 111,271,220.54
reception of
Co., Ltd.
labor services
Goods
purchase and
SmartLink 89,982,268.22 141,240,000.00 No 56,377,549.17
reception of
labor services
Qiming Goods
Information purchase and
72,665,910.12 143,800,000.00 No 31,889,903.88
Technology Co., reception of
Ltd. labor services
Goods
China FAW
purchase and
Group Import & 62,900,925.02 156,060,000.00 No 45,346,979.72
reception of
Export Co., Ltd.
labor services
Goods
Grammer Vehicle
purchase and
Parts (Harbin) 45,950,885.93 150,000,000.00 No
reception of
Co., Ltd.
labor services
The Ninth
Institute of Goods
Project Planning purchase and
35,812,164.45 348,760,000.00 No 99,069,799.94
& Research of reception of
China Machinery labor services
Industry (FIPPR)
Changchun Goods
22,796,281.44 134,240,000.00 No
Automotive Test purchase and
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Center Co., Ltd. reception of
labor services
Goods
FAW Jilin
purchase and
Automobile Co., 2,367,964.59 195,530,000.00 No
reception of
Ltd.
labor services
China FAW Goods
Group Co., Ltd. purchase and
484,341,667.60 1,022,340,000.00 No 368,678,042.08
and other related reception of
parties labor services
Statement of goods sales/rendering of services
Unit: CNY
Content of
Amount Incurred in Amount Incurred in the
Related Parties Related
Current Period Previous Period
Transaction
China FAW Group Import & Export Co.,
Sales of goods 6,728,264,167.89 2,292,647,625.45
Ltd.
FAW Jiefang Fujie (Tianjin) Technology
Sales of goods 1,213,457,947.93 342,974,356.23
Industry Co., Ltd.
FAW Changchun Comprehensive
Sales of goods 100,636,434.81 83,819,550.59
Utilization Co., Ltd.
SmartLink Sales of goods 66,851,895.14
Changchun Faw Service Trade Co., Ltd. Sales of goods 27,873,745.56 115,783,309.46
China FAW Group Co., Ltd. and other
Sales of goods 39,501,124.08 86,537,319.33
related parties
Description of related transactions of purchasing or selling goods and providing or receiving labor services:
(2) Related lease
The Company, as the lessor:
Unit: CNY
Lease Income Lease Income
Name of Lessee Type of Leased Assets Recognized in the Recognized in the
Current Period Previous Period
Changchun Automotive Test Center
Houses and buildings 1,288,392.99 2,678,255.50
Co., Ltd.
FAW Houses and buildings 1,017,306.92 3,022,825.56
Fawer Auto Parts Co., Ltd. Houses and buildings 197,702.76 197,702.76
FAW Changchun Communication
Land 109,541.28
Technology Co., Ltd.
Shandong Pengxiang Automobile
Houses and buildings 377,350.46 377,350.46
Co., Ltd.
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The Company, as the lessee:
Unit: CNY
Rental Expenses Variable Lease
for Simplified Payments not
Interest Expense on
Short-term leases Included in the Increased Right-of-
Rent Paid Lease Liabilities
and Low-value Measurement of Use Assets
Incurred
Type of asset Leases (If Lease Liabilities (If
Name of lessor Leased Applicable) Applicable)
Assets Amount Amount Amount Amount Amount Amount Amount Amount
Amount Amount
Incurred Incurred Incurred Incurred Incurred Incurred in Incurred Incurred
Incurred in Incurred in
in in the in in the in the in in the
Current the Previous
Current Previous Current Previous Current Previous Current Previous
Period Period
Period Period Period Period Period Period Period Period
House and
FAW Group 2,132,938.00 2,132,938.00 262,865.98
land
Houses and
FAW 4,427,832.76 22,096.94 773,218.73
buildings
FAW Asset Management Houses and
157,096.00 5,750.02
Co., Ltd. buildings
Changchun Automotive Houses and
2,335,846.88 55,363.78
Test Center Co., Ltd. buildings
Description of related leases
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(3) Remuneration of key management personnel
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Remuneration of key management
10,890,749.06 15,228,996.18
personnel
(4) Other related transactions
Interest income Unit: CNY 10,000
Content of
Amount Incurred in the
Related Parties Related Amount Incurred in Current Period
Previous Period
Transaction
First Automobile Finance Co.,
Interest income 5,986.34 17,744.08
Ltd.
6. Receivables and payables of related parties
(1) Receivables
Unit: CNY
Ending Balance Opening Balance
Project
Related Parties Provision for Provision for
Name Book Balance Book Balance
Bad Debts Bad Debts
China FAW Group
Accounts
Import & Export 1,465,254,854.26 4,069,205.50 320,294,820.43 410,938.55
receivable
Co., Ltd.
Accounts
SmartLink 73,770,000.00 73,770.00
receivable
FAW Hongta
Yunnan
Accounts
Automobile 61,173,492.53 15,728,877.75 61,683,343.69 7,544,307.53
receivable
Manufacturing
Co., Ltd.
Jiefang Times
Accounts New Energy
18,000,000.00 18,000.00
receivable Technology Co.,
Ltd.
Changchun Faw
Accounts
Service Trade Co., 8,097,726.39 44,537.50
receivable
Ltd.
Accounts China FAW Co.,
3,006,132.39 12,607.08 880,188.52 3,696.78
receivable Ltd.
Accounts Changchun
2,360,610.02 9,914.56
receivable Yidong Clutch
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Co., Ltd.
Accounts FAW Jingye
1,820,957.23 1,820,957.23 1,820,957.23 1,820,957.23
receivable Engine Co., Ltd.
Qiming
Accounts Information
1,413,823.28 5,938.06
receivable Technology Co.,
Ltd.
FAW Asset
Accounts
Management Co., 617,143.28 455,680.94 469,957.39 455,062.76
receivable
Ltd.
FAW Changchun
Accounts Communication
60,000.00 252.00
receivable Technology Co.,
Ltd.
Accounts Fawer Auto Parts
18,140.87 76.19
receivable Co., Ltd.
Changchun
FAWAY
Accounts
Automobile 8,670.94
receivable
Components Co.,
Ltd.
FAW Logistics
Accounts
(Qingdao) Co., 3,233,572.00 13,581.00
receivable
Ltd.
Changchun
Accounts
Automotive Test 2,919,274.52 12,260.95
receivable
Center Co., Ltd.
United Fuel Cell
Accounts
System R&D 200,233.26 840.98
receivable
(Beijing) Co., Ltd.
FAW-Volkswagen
Accounts
Automotive Co., 110,880.00 465.70
receivable
Ltd.
FAW Changchun
Accounts Yanfeng Visteon
105,367.99 11,453.28
receivable Electronics Co.,
Ltd.
FAW Harbin Light
Accounts
Automobile Co., 3,787.60 15.91
receivable
Ltd.
Other China FAW Co.,
8,825,241.85 8,232,613.09 8,453,593.02 8,229,193.92
receivables Ltd.
China FAW Group
Other
Import & Export 246,006.55 836.42 50,623.62 172.12
receivables
Co., Ltd.
Other CHINA FAW 189,533.68 1,743.71 189,533.68 1,743.71
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receivables GROUP CO.,
LTD.
FAW Asset
Other
Management Co., 135,550.51 787.06 135,550.51 787.06
receivables
Ltd.
Other FAW Logistics
146,367.32 1,346.58
receivables Co., Ltd.
Other FAW Forging
55,563.56 511.19
receivables (Jilin) Co., Ltd.
FAW Mold
Other
Manufacturing 49,165.85 452.33
receivables
Co., Ltd.
Changchun
FAWAY
Other
Automobile 16,388.62 68.83
receivables
Components Co.,
Ltd.
FAW Logistics
(Changchun
Other Lushun) Storage
5,086.11 46.79
receivables and
Transportation
Co., Ltd.
Changchun
Other
Automotive Test 231.00 0.23
receivables
Center Co., Ltd.
China FAW Group
Accounts
Import & Export 345,979,162.62 287,527,616.69
prepayment
Co., Ltd.
FAW Hongta
Yunnan
Accounts
Automobile 20,604,798.36 20,604,798.36
prepayment
Manufacturing
Co., Ltd.
FAW Jilin
Accounts
Automobile Co., 18,511,380.48 646,730.48
prepayment
Ltd.
The Ninth
Institute of Project
Accounts Planning &
12,786,400.00 12,786,400.00
prepayment Research of China
Machinery
Industry (FIPPR)
FAW Mold
Accounts
Manufacturing 12,535,501.16 13,751,495.26
prepayment
Co., Ltd.
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Accounts
SmartLink 3,919,914.00 2,283,555.30
prepayment
Qiming
Accounts Information
3,127,370.18 6,853,106.60
prepayment Technology Co.,
Ltd.
Accounts
FAW 9,862,836.98
prepayment
FAW Changchun
Accounts Communication
639,459.98
prepayment Technology Co.,
Ltd.
FAW Changchun
Tianqi Process
Accounts
Equipment 537,315.00
prepayment
Engineering Co.,
Ltd.
(2) Payables
Unit: CNY
Beginning Book
Project Name Related Parties Ending Book Balance
Balance
Accounts payable Fawer Auto Parts Co., Ltd. 400,777,386.93 144,154,473.17
Changchun FAWAY Automobile
Accounts payable 320,851,984.26 79,486,373.63
Components Co., Ltd.
China FAW Group Import & Export Co.,
Accounts payable 303,147,549.00
Ltd.
Accounts payable FAW Logistics (Qingdao) Co., Ltd. 119,128,692.42 91,101,620.88
Accounts payable Changchun Yidong Clutch Co., Ltd. 104,908,119.76 21,092,492.24
Accounts payable FAW Logistics Co., Ltd. 98,357,972.15 32,265,403.36
Accounts payable Changchun FAWSN Group Co., Ltd. 93,595,327.31 14,386,006.95
Shandong Pengxiang Automobile Co.,
Accounts payable 93,385,870.66 34,193,762.56
Ltd.
Accounts payable FAW Foundry Co., Ltd. 81,977,130.66 51,984,437.61
Accounts payable FAW Forging (Jilin) Co., Ltd. 74,071,760.93 18,898,210.68
Accounts payable Qiming Information Technology Co., Ltd. 33,290,239.25 20,174,791.43
Accounts payable SmartLink 29,447,850.45 14,489,906.15
FAW Changchun Ansteel Steel Processing
Accounts payable 27,575,970.27 15,646,652.24
and Distribution Co., Ltd.
FAW Changchun Baoyou Jiefang Steel
Accounts payable 26,990,521.85 4,937,649.97
Processing and Distribution Co., Ltd.
Accounts payable FAW Jilin Automobile Co., Ltd. 23,770,525.59 13.33
Accounts payable FAW Harbin Light Automobile Co., Ltd. 23,371,308.87 16,170,855.51
Accounts payable FAW Logistics (Changchun Lushun) 18,446,223.44 11,426,277.60
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Storage and Transportation Co., Ltd.
Accounts payable Grammer Vehicle Parts (Harbin) Co., Ltd. 17,243,318.77 701,342.31
Accounts payable China FAW Co., Ltd. 13,678,830.05
Changchun Wabco Automotive Control
Accounts payable 11,768,889.95 272,712.00
System Co., Ltd.
Grammer Vehicle Parts (Qingdao) Co.,
Accounts payable 9,886,971.54 3,402,836.35
Ltd.
Changchun Automotive Test Center Co.,
Accounts payable 7,900,717.76 316,400.00
Ltd.
FAW (Dalian) International Logistics Co.,
Accounts payable 4,544,914.59 3,851,730.60
Ltd.
FAW Changchun Comprehensive
Accounts payable 2,230,531.36 2,905,411.90
Utilization Co., Ltd.
Changchun FAW United Casting
Accounts payable 1,614,772.37 521,726.80
Company
FAW Changchun Automobile Trading
Accounts payable 1,326,364.99 1,479,550.69
Service Co., Ltd.
Accounts payable Wuxi Sawane Spring Co., Ltd. 1,093,878.66 233,647.89
Wuxi CRRC New Energy Automobile
Accounts payable 776,959.03 757,023.75
Co., Ltd.
Accounts payable Hainan Tropical Automobile Test Co., Ltd. 505,877.00 31,977.00
FAW Changchun Tianqi Process
Accounts payable 257,729.43 8,891.97
Equipment Engineering Co., Ltd.
Dalian Qiming Haitong Information
Accounts payable 240,000.00 248,852.00
Technology Co., Ltd.
FAW Changchun Industrial Shuixing
Accounts payable 232,190.22 184,682.20
Rubber and Plastic Products Co., Ltd.
FAW Changchun Yanfeng Visteon
Accounts payable 161,498.64 715,521.31
Electronics Co., Ltd.
Accounts payable Harbin FAW Transmission Co., Ltd. 93,627.49
Accounts payable FAW Mold Manufacturing Co., Ltd. 64,800.00 1,121,206.34
The Ninth Institute of Project Planning &
Accounts payable Research of China Machinery Industry 41,999.48 1,751,774.48
(FIPPR)
China Unicom Intelligent Network
Accounts payable 32,893.00 54,880.00
Technology Co., Ltd.
Changchun FAW Pratt Technology Co.,
Accounts payable 17,315.37 17,236.96
Ltd.
FAW Zhixing Technology (Nanjing) Co.,
Accounts payable 16,200.00
Ltd.
FAW Jiefang Fujie (Tianjin) Technology
Accounts payable 15,851.74 111,795.54
Industry Co., Ltd.
FAW Changchun Communication
Accounts payable 13,562.20 233,570.95
Technology Co., Ltd.
Accounts payable Suzhou Zhito Technology Co., Ltd. 8,113.93 1,011,118.95
Accounts payable FAW Bestune Car Co., Ltd. 5,100.00 5,100.00
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Hongqi Intelligent Mobility Technology
Accounts payable 1,068.67 121,039.88
(Beijing) Co., Ltd.
Accounts payable FAW 34,214,102.32
FAW Hongta Yunnan Automobile
Accounts payable 4,551,929.99
Manufacturing Co., Ltd.
FAW Changchun Industrial Sodis
Accounts payable 2,149,473.72
Management Service Co., Ltd.
Accounts payable Sanguard Automobile Insurance Co., Ltd. 1,074,463.94
Accounts payable Changchun Faw Service Trade Co., Ltd. 849,829.54
Changchun Automotive Economic and
Technological Development Zone
Accounts payable 630,751.44
Environmental Sanitation and Cleaning
Co., Ltd.
Changchun FAW Automobile Culture
Accounts payable 82,778.99
Communication Co., Ltd.
Accounts payable FAW Group 14,133.00
The Ninth Institute of Project Planning &
Other payables Research of China Machinery Industry 118,986,888.63 170,438,828.71
(FIPPR)
Other payables FAW Mold Manufacturing Co., Ltd. 24,402,495.87 32,192,507.66
China FAW Group Import & Export Co.,
Other payables 21,732,546.71 2,264,521.88
Ltd.
Other payables Qiming Information Technology Co., Ltd. 14,228,113.56 31,377,721.05
FAW Jiefang Fujie (Tianjin) Technology
Other payables 10,100,000.00 20,050,000.00
Industry Co., Ltd.
Shandong Pengxiang Automobile Co.,
Other payables 1,040,000.00 1,040,000.00
Ltd.
FAW Changchun Communication
Other payables 924,511.59 3,483,543.17
Technology Co., Ltd.
FAW Hongta Yunnan Automobile
Other payables 831,560.00 831,560.00
Manufacturing Co., Ltd.
Other payables China FAW Co., Ltd. 500,231.25 2,792,527.37
Other payables Fawer Auto Parts Co., Ltd. 425,586.91 429,040.30
Other payables Suzhou Zhito Technology Co., Ltd. 10,000.00 10,000.00
Other payables FAW Asset Management Co., Ltd. 6,775.62 3,925.62
Changchun FAWAY Automobile
Other payables 5,756.35
Components Co., Ltd.
Other payables CHINA FAW GROUP CO., LTD. 1,693.00 371,435.96
FAW Changchun Tianqi Process
Other payables 4,361,315.10
Equipment Engineering Co., Ltd.
Other payables Changchun Faw Service Trade Co., Ltd. 629,405.00
Other payables SmartLink 182,000.00
Other payables Hainan Tropical Automobile Test Co., Ltd. 97,185.18
Changchun Automotive Test Center Co.,
Other payables 42,616.35
Ltd.
Accounts received China FAW Co., Ltd. 387,437.85
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in advance
Accounts received
Fawer Auto Parts Co., Ltd. 107,748.00 107,748.00
in advance
Accounts received FAW Changchun Communication
6,422.03 17,431.19
in advance Technology Co., Ltd.
Accounts received FAW Changchun Comprehensive
2,810.38 38,791.52
in advance Utilization Co., Ltd.
Accounts received Changchun Automotive Test Center Co.,
1,530,824.16
in advance Ltd.
FAW Jiefang Fujie (Tianjin) Technology
Contract liabilities 31,717,676.04 68,040,782.38
Industry Co., Ltd.
Contract liabilities Changchun Faw Service Trade Co., Ltd. 4,605,308.63 15,663,935.13
FAW Changchun Comprehensive
Contract liabilities 1,094,946.24 547,549.31
Utilization Co., Ltd.
Shandong Pengxiang Automobile Co.,
Contract liabilities 436,036.83 436,111.40
Ltd.
Contract liabilities Suzhou Zhito Technology Co., Ltd. 251,681.42 1,181,411.98
China FAW Group Import & Export Co.,
Contract liabilities 67,028.26 2,676,797.47
Ltd.
Contract liabilities FAW Asset Management Co., Ltd. 20,698.19 20,698.19
FAW New Energy Vehicle Sales
Contract liabilities 8,060.00 7,132.74
(Shenzhen) Co., Ltd.
Contract liabilities FAW Logistics Co., Ltd. 9.88 9.88
FAW Hongta Yunnan Automobile
Contract liabilities 36,704.04
Manufacturing Co., Ltd.
Contract liabilities Harbin FAW Transmission Co., Ltd. 119.16
7. Others
Deposit and interest of finance company Unit: CNY
Ending Balance of
Project name Related Parties Contents Ending Balance
the previous year
Deposits and
First Automobile interests of finance 8,482,461,533.79 13,832,934,255.95
Monetary capital
Finance Co., Ltd. company included
in bank deposits
XII. Share-based Payment
1. General conditions of share-based payments
□ Applicable Not applicable
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2. Equity-settled share-based payment
□ Applicable Not applicable
3. Cash-settled share-based payment
□ Applicable Not applicable
XIII. Commitments and Contingencies
1. Important commitments
Important commitments existing on the balance sheet date: As of June 30, 2023, the Company has no
commitments to be disclosed.
2. Contingencies
(1) Important contingencies existing on the balance sheet date
Contingent liabilities arising from pending litigation and arbitration and their financial impact
Court of Amount Involved Case
Plaintiff Defendant Cause of Action
Acceptance (CNY) Progress
Heilongjiang FAW Jiefang
People's Court of
Xinjinshan Automotive
Changchun
Environmental Co., Ltd. and
Automobile
Protection Engineering Transmission Disputes over sales
Economic & 5,920,000.00 First instance
Co., Ltd. Branch of FAW contract
Technological
Jiefang
Development
Automotive
Zone
Co., Ltd.
FAW Jiefang People's Court of
Automotive Changchun
Co., Ltd., Jilin Disputes over Automobile
Zheng Siyou, Wang
Huaang construction Economic and 1,494,402.70 First instance
Yanqin
Construction contract Technological
Engineering Development
Co., Ltd., Li Jie Zone
Ma'anshan
Dingding
Automobile Anhui Ma'anshan
Product quality Second
Chen Yun Trading Co., Intermediate 1,265,022.78
disputes instance
Ltd. and China People's Court
FAW Group
Co., Ltd.
Other 23 items 5,911,770.65
As of June 30, 2023, the Company has no contingencies other than those mentioned above that
should be disclosed.
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(2) Explanation is also required when the Company has no important contingencies to be disclosed
The Company has no important contingencies to be disclosed.
XIV. Other important matters:
1. Annuity plan
The Company decided to participate in the enterprise annuity plan implemented by FAW Group from January 1,
2010, and 5 other companies implemented self-defined enterprise annuity plans according to the Labor Law of
the People's Republic of China, the Trust Law of the People's Republic of China, the Trial Measures for
Enterprise Annuity (Order No. 20 of the Ministry of Labor and Social Security) and other laws and regulations,
and in combination with actual situation of the Company.
Main contents of annuity plan are as follows:
(1) "Enterprise annuity" mentioned in this plan refers to the enterprise supplementary endowment insurance
system voluntarily established by the enterprise and its employees according to national policies and regulations
on the basis of purchasing the basic endowment insurance and fulfilling the payment obligation according to
law, and is an integral part of the enterprise employee compensation and welfare system.
(2) Organization, management and supervision: Enterprise representatives and employee representatives
establish the FAW Enterprise Annuity Council (hereinafter referred to as the Annuity Council) through
collective negotiation. The Annuity Council is composed of enterprise and employee representatives, of which
not less than one third are employee representatives. The Annuity Council, as the trustee of this plan, is
responsible for the operation and management of FAW Group's enterprise annuity fund.
(3) Fund raising and payment methods: The expenses required for enterprise annuity are jointly paid by the
enterprise and employees.
(4) Account management: The enterprise annuity fund implements a full accumulation system and is managed
by personal accounts. At the same time, enterprise accounts are established to collect unvested rights and
interests.
(5) Fund management: The enterprise annuity fund consists of the following items: ① Enterprise's payment;
② Employees' payment; ③ Investment and operation income. The enterprise annuity fund is entrusted to the
Annuity Council for management. The enterprise and employee representatives entrust the Company to sign the
enterprise annuity fund entrusted management contract with the Annuity Council through collective negotiation,
and entrust the Annuity Council for management and market-oriented operation of the enterprise annuity fund
collected by this plan.
(6) Benefit planning and distribution: The employee's payment and its investment income belong to the
employee; the part of enterprise's payment distributed to the individual account and its investment income
belong to the employee as specified, and the part not belonging to the individual is transferred to the enterprise
account.
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(7) Payment method of enterprise annuity: ① For the retired employee and the employee completing the
retirement procedures, the balance of the annuity personal account can be received at one time (or monthly, in
several times or at one time based the balance of the individual account, the individual income tax burden, etc.);
② For the dead, the balance of the individual account of the enterprise annuity can be collected by the legal
successor at one time; ③ For the overseas residents, the balance of the personal account of the enterprise
annuity may be paid to them at one time according to their requirements.
2. Others
Lease: as lessee
The Company simplifies the short-term lease and low-value asset lease, and does not recognize the right-of-use
assets and lease liabilities. The short-term lease, low-value assets and variable lease payments not included in
the lease liabilities measurement are included in the expenses in the current period as follows:
Unit: CNY
Item Amount Incurred in Current Period
Short-term lease 20,118,245.66
Low-value lease
Variable lease payments not included in the measurement of lease
liabilities
Total 20,118,245.66
XV. Notes to Main Items of Parent Company's Financial Statements
1. Other receivables
Unit: CNY
Item Ending Balance Opening Balance
Other receivables 224,132.76 224,132.76
Total 224,132.76 224,132.76
(1) Other receivables
1) Classification of other receivables by nature
Unit: CNY
Nature Ending Book Balance Beginning Book Balance
Current account 459,006.26 459,006.26
Total 459,006.26 459,006.26
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2) Provision for bad debts
Unit: CNY
Stage I Stage II Stage III
Expected Credit
Provision For bad Expected Credit
Expected Credit Loss over the Entire Total
Debts Losses over the
Losses for the Next Duration (Credit
Entire Duration (no
12 Months Impairment
Credit Impairment)
Occurred)
Balance on January
234,873.50 234,873.50
1, 2023
Balance on January
1, 2023 in the
current period
Balance on June 30,
234,873.50 234,873.50
2023
Significant book balance changes occurred in the provision for losses in the current period
□ Applicable Not applicable
Disclosed by aging Unit: CNY
Aging Ending Balance
1-2 years 459,006.26
Total 459,006.26
3) Top five ending balances of other receivables classified by debtors
Unit: CNY
Proportion in
Total Ending Ending Balance
Nature of
Name of Unit Ending Balance Aging Balance of of Provision for
Payment
Other Bad Debts
Receivables
Changchun
Committee of
Municipal and Current account 459,006.26 1-2 years 100.00% 234,873.50
Rural
Construction
Total 459,006.26 100.00% 234,873.50
2. Long-term equity investment
Unit: CNY
Ending Balance Opening Balance
Item Impairment Impairment
Book Balance Book Value Book Balance Book Value
Provision Provision
Investment in 21,109,221,438. 21,109,221,438.3 21,109,221,438.3
21,109,221,438.36
subsidiaries 36 6 6
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Investment in
associated
4,699,040,720.0
enterprises 4,699,040,720.01 4,471,059,131.83 4,471,059,131.83
1
and joint
ventures
25,808,262,158. 25,808,262,158.3 25,580,280,570.1
Total 25,580,280,570.19
37 7 9
(1) Investment in subsidiaries
Unit: CNY
Increase/Decrease in the Current Period Ending
Opening Balance Ending Balance (Book Balance of
Investee Additional Reduced Impairment
(Book Value) Others Value) Impairment
Investment Investment Provision
Provision
FAW Jiefang
Automotive 21,109,221,438.36 21,109,221,438.36
Co., Ltd.
Total 21,109,221,438.36 21,109,221,438.36
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(2) Investment in associated enterprises and joint ventures
Unit: CNY
Increase/Decrease in the Current Period
Ending
Investment Gains or Adjustment to
Opening Balance Changes Cash Dividends Ending Balance (Book Balance of
Investor Additional Reduced Losses Recognized Other Impairment
(Book Value) in Other and Profits Others Value) Impairment
Investment Investment under the Equity Comprehensive Provision
Equity Declared to Pay Provision
Method Income
I. Joint ventures
II. Associated enterprises
First
Automobile 4,270,037,969.59 228,656,115.49 258,953.96 4,498,953,039.04
Finance Co., Ltd.
Sanguard
Automobile
201,021,162.24 3,906,929.80 -4,533.20 4,835,877.87 200,087,680.97
Insurance Co.,
Ltd.
Subtotal 4,471,059,131.83 232,563,045.29 254,420.76 4,835,877.87 4,699,040,720.01
Total 4,471,059,131.83 232,563,045.29 254,420.76 4,835,877.87 4,699,040,720.01
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3. Investment income
Unit: CNY
Amount Incurred in the Previous
Item Amount Incurred in Current Period
Period
Income from long-term equity
investments accounted for using the 232,563,045.29 292,234,106.00
equity method
Total 232,563,045.29 292,234,106.00
XVI. Supplementary Information
1. Breakdown of non-recurring profit or loss of current period
Applicable □ Not applicable
Unit: CNY
Item Amount Description
Profits or losses on disposal of non-current assets It refers to the net
(including the write-off part of the impairment provision 98,132,494.11 profit on disposal of
of assets withdrawn) non-current assets.
Government subsidies included in the current profit and
loss (except those closely related to the Company normal
operations, conforming to the State policies and 193,604,585.44
regulations and enjoyed persistently in line with certain
standard quotas or quantities)
It mainly refers to the
reversal of impairment
Reversal of impairment provision for receivables subject provision for
59,131.00
to separate impairment test receivables subject to
separate impairment
test.
They mainly refer to
Non-operating income and expenses other than the above
5,740,722.98 the net non-operating
items
income and expenses
Less: amount affected by income tax 48,166,962.97
Total 249,369,970.56 --
Specific conditions of other profit and loss items meeting the definition of non-recurring profit and loss:
□ Applicable Not applicable
There are no specific conditions of profit and loss items meeting definition of non-recurring profit and loss for
the Company.
Explanation on defining the non-recurring profit and loss items listed in the Explanatory Announcement No. 1
on Information Disclosure by Companies Issuing Securities Publicly - Non-recurring Profit and Loss as
recurring profit and loss items
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□ Applicable Not applicable
2. Return on net assets and earnings per share
Earnings per Share
Profit for the Reporting Weighted Average Return
Basic Earnings per Share Diluted Earnings per
Period on Equity
(CNY/share) Share (CNY/share)
Net profit attributable to 0.0872 0.0872
ordinary shareholders of 1.68%
the Company
Net profit attributable to 0.0330 0.0330
ordinary shareholders of
the Company after 0.64%
deduction of non-
recurring profit and loss
3. Differences in accounting data under domestic and foreign accounting standards
(1) Differences in net profits and net assets in the financial report disclosed simultaneously according to
the international accounting standards and China accounting standards
□ Applicable Not applicable
(2) Differences in net profits and net assets in the financial report disclosed simultaneously according to
foreign accounting standards and China accounting standards
□ Applicable Not applicable
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